44:0162(16)CA - - VA Medical Center, Veterans Canteen Service, Lexington, KY and NAGE Local R5-184 - - 1992 FLRAdec CA - - v44 p162

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[ v44 p162 ]
The decision of the Authority follows:

44 FLRA No. 16










LOCAL R5-184

(Charging Party)



February 28, 1992

Before Chairman McKee and Members Talkin and Armendariz.

I. Statement of the Case

The Administrative Law Judge issued the attached decision in the above-entitled proceeding finding that the Respondent violated section 7116(a)(1) and (5) of the Federal Service Labor-Management Relations Statute (the Statute) by unilaterally instituting changes in the working conditions of unit employees when it raised the prices charged to those employees for food served in its cafeteria without providing notice to the Union and affording it the opportunity to bargain concerning the changes. The Respondent filed exceptions to the Administrative Law Judge's decision and the General Counsel filed an opposition to the Respondent's exceptions.

Pursuant to section 2423.29 of the Authority's Rules and Regulations and section 7118 of the Statute, we have reviewed the rulings of the Judge made at the hearing. We affirm those rulings. Upon consideration of the Judge's decision and the entire record, we adopt, for reasons set forth more fully below, the Judge's findings, conclusions and recommended Order.(1)

The Respondent contends that the Secretary of the Department of Veterans Affairs (VA), the head of the Respondent Agency, has exclusive statutory authority to establish prices for goods or services provided by the Veterans' Canteen Service (VCS) in the Respondent's canteens, including its cafeterias, and that, therefore, it had no obligation under section 7114(a)(1) to bargain with the Union over the changes in cafeteria prices that affected the unit employees. We disagree with this contention, as did the Judge.

When an agency claims that a matter is not negotiable because it possesses statutory authority to take certain actions concerning that matter, the Authority examines whether the authority granted to the agency is exclusive and unfettered or whether the agency may lawfully exercise its authority through collective bargaining. Thus, where law or applicable regulation vest an agency with unfettered discretion over a matter, the agency's discretion will not be subject to negotiation. See, for example, Illinois National Guard v. FLRA, 854 F.2d 1396, 1402 (D.C. Cir. 1988) (Illinois National Guard) (National Guard Technician Act, which allows the agency head to prescribe the hours of duty for technicians notwithstanding any other provision of law, commits decisions regarding technicians' work schedules to the agency head's unfettered discretion); Colorado Nurses Association v. FLRA, 851 F.2d 1486 (D.C. Cir. 1988) (Colorado Nurses) (because 38 U.S.C. §§ 4108 grants the Veterans Administration unfettered discretion to prescribe the working conditions of the employees in the Department of Medicine and Surgery, the agency was not obligated to bargain over the union's proposals); Police Association of the District of Columbia and Department of the Interior, National Park Service, U.S. Park Police, 18 FLRA 348 (1985) (Park Police) (statute provided exclusive procedure for minor disciplinary actions for bargaining unit members and, therefore, proposal that permitted appeals of disciplinary actions through the negotiated grievance procedure was nonnegotiable).

In contrast, the Authority has consistently held that matters concerning conditions of employment over which an agency has discretion are negotiable if the agency's discretion is not exclusive and the matters to be negotiated are not otherwise inconsistent with law or applicable rule or regulation. See, for example, U.S. Department of Defense, Office of Dependents Schools and Overseas Education Association, 40 FLRA 425, 441-43 (1991) and cases cited therein; National Treasury Employees Union and Family Support Administration, Department of Health and Human Services, 30 FLRA 677, 682 (1987) (Family Support Administration) (where statute authorized the head of the agency "to establish or provide for the establishment of appropriate fees and charges" the Authority found that the "statute leaves the [a]gency with discretion to determine the appropriate fees").

In this case, the Respondent argues that the statute establishing the VCS (2) grants exclusive discretion to the Secretary of the Department of Veterans Affairs to establish prices in its canteens and cafeterias because it states:

The Secretary shall--

. . . . . . .

(7) fix the prices of merchandise and services in canteens so as to carry out the purposes of this chapter;

38 U.S.C. § 7802.

We find nothing in the statute establishing the VCS or its legislative history that prohibits the Respondent from setting those prices through negotiation with the Union. Rather, the statute simply grants the Secretary of the Agency the discretion to fix the prices. Under established Authority law, that discretion may be exercised through negotiations. Family Support Administration, 30 FLRA at 682. Significantly, the statute contains no language excluding or limiting the application of other laws. Compare Colorado Nurses, 851 F.2d at 1490-91 (where amendment to statute stated that "[n]otwithstanding any other provision of law, no provision of title 5 or any other law pertaining to the civil service system which is inconsistent with any provision of [the applicable statute] shall be considered to supersede, override, or otherwise modify such provision of this subchapter[,]" court held that the agency's authority to determine conditions of employment was not subject to bargaining under the Statute); New Jersey Air National Guard v. FLRA, 677 F.2d 276, 283 (3d Cir. 1982) (New Jersey Air National Guard) (where statute contains the language "notwithstanding any other provision of law . . . . [T]he preemptive language is powerful evidence that Congress did not intend any other, more general, legislation, whenever enacted, to qualify the authority of the [agency head] as set out in the [statute]"); Park Police, 18 FLRA at 354-56 (where statute provides that it takes effect notwithstanding any other law, the appeals procedures of that statute constitute an exception to the negotiated grievance procedures mandated by the Statute). We consider the absence of such preemptive language in this case to be a strong indication that Congress did not intend the Secretary of the VA to have unfettered discretion to set prices.

The Respondent also claims that the exclusive authority of the Secretary of the VA derives from 38 U.S.C.A. § 7808, which is entitled "Service to be independent unit" and which states:

It is the purpose of this chapter that, under control and supervision of the Secretary, the [VCS] shall function as an independent unit in the [VA] and shall have exclusive control over all its activities including sales, procurement and supply, finance, including disbursements, and personnel management, except as otherwise provided in this chapter.

As we read this provision and its legislative history, its purpose was to ensure that the VCS would be operated as an independent entity within the VA, and not to dictate how the Secretary of the VA would exercise its delegated discretion regarding those operations. Thus, in the "Explanatory Statements" contained in both the Senate and House reports accompanying the original legislation, this provision is described as declaring

the purpose of the act to be that the [VCS] shall function as an independent unit within the [VA] and have exclusive control over all of its operations. The [VA] now operates 107 hospitals and homes at each of which there is need for canteen service. When the current hospital program is complete the number will be substantially increased. The [VCS] as a whole is to function as a unit and each sales store and service outlet will be an integral part thereof. Since the [VCS] is to function as a unit and its operations are of a commercial nature, it is considered essential that it have maximum direct control over its activities.

S. Rep. No. 1701, 79th Cong., 2d Sess. 5 (1946); H.R. Rep. No. 2432, 79th Cong., 2d Sess (1946).

In view of the wording of 38 U.S.C.A. § 7808, read in its entirety, and the explanatory material in the legislative history, we are not persuaded that the requirement that the VCS have "maximum direct control over its activities" is meant in any way to limit the scope of