United States, Department of Veterans Affairs, Consolidated Mail , Outpatient Pharmacy, Leavenworth, Kansas (Respondent) and American Federation of Government Employees, AFL-CIO, Local 85 (Charging Party)

[ v60 p844 ]

60 FLRA No. 159

UNITED STATES
DEPARTMENT OF VETERANS AFFAIRS
CONSOLIDATED MAIL
OUTPATIENT PHARMACY
LEAVENWORTH, KANSAS
(Respondent)

and

AMERICAN FEDERATION
OF GOVERNMENT EMPLOYEES
AFL-CIO, LOCAL 85
(Charging Party)

DE-CA-02-0321

_____

DECISION AND ORDER

April 15, 2005

_____

Before the Authority: Dale Cabaniss, Chairman, and
Carol Waller Pope and Tony Armendariz, Members [n1] 

I.      Statement of the Case

      This unfair labor practice case is before the Authority on exceptions to the attached decision of the Administrative Law Judge (Judge) filed by the Respondent. The General Counsel (GC) filed an opposition to the Respondent's exceptions.

      The complaint alleges that the Respondent violated § 7116(a)(1) and (5) of the Federal Service Labor-Management Relations Statute (the Statute) by repudiating two Memoranda of Understanding (MOUs) when it reinstated a tour of duty that included Saturdays as part of the regular workweek. The Judge found that the Respondent violated the Statute, as alleged.

      Upon consideration of the Judge's decision and the entire record, we conclude, for the reasons set forth below, that the Respondent did not violate the Statute. Accordingly, we dismiss the complaint.

II.      Background and Judge's Decision

A.     Background

      The American Federation of Government Employees, AFL-CIO, National Veterans Affairs Council of Locals (AFGE) and the Department of Veterans Affairs (VA) have a master nationwide agreement that took effect in 1997 for a period of 3 years and was thereafter automatically renewed. At the time of the events giving rise to this case, AFGE and the VA were renegotiating the master agreement. Article 44 of the master agreement concerns midterm negotiations, and addresses, among other things, negotiations over matters covered under § 7106(b)(1) of the Statute. [n2] 

      The Respondent in this case, the Consolidated Mail Outpatient Pharmacy (CMOP), Leavenworth, Kansas, is one of seven pharmacies within the VA. The Respondent provides pharmaceutical care to veterans and healthcare providers. The Respondent's goal is to fill and send prescriptions within 48 hours of receiving them. AFGE Local 85 (the Union) is AFGE's agent at the Respondent's facility, and represents pharmacy technicians and housekeepers.

      Before November 2000, the Respondent scheduled employees to work one shift, with two different starting and quitting times. The shift was a six-day, 40-hour workweek that included Saturday as part of the employees' regular tour of duty. About that time, the Respondent sought to add a second shift because it had assumed responsibility for filling prescriptions from additional VA facilities.

      On October 16, 2000, the Respondent and the Union entered into a local MOU that established two separate work shifts at the Respondent's facility. In relevant part, paragraph 7 of this MOU states that "[a]fter implementation of the two separate shifts, Saturday will be eliminated from the regular tour of duty." Joint Ex. 2. Subsequently, on November 3, 2000, the Respondent [ v60 p845 ] and the Union entered into another local MOU, which contains procedures for assigning overtime work on weekends at the facility. See Joint Ex. 3. Among other things, paragraph 3 of the November MOU provides "that in the event CMOP must be operated on Saturday or Sunday and where there were insufficient volunteers, management could mandate either day or evening shifts to work on the weekend." Judge's Decision at 14. Neither MOU contains an expiration date or refers to the Master Agreement.

      After the MOUs were implemented, the Respondent began operating two shifts -- 6:30 a.m. to 3:00 p.m. and 3:00 p.m. to midnight. The regular tour of duty for both shifts was Monday through Friday.

      Beginning in February 2001, the Respondent determined that it was necessary to schedule employees to work overtime on Saturdays because of increased workload. During 2001, the Respondent scheduled employees to work overtime on 44 weekends, 10 of which were mandatory assignments because insufficient volunteers were available.

      By memorandum of January 24, 2002, the Respondent notified the Union that its workload had continued to increase over the previous six months and was projected to continue to increase. The memo further stated:

The existing schedule has not met the needs and increasing demands of the current work requirements. In order to expedite the medications to our veterans in a timely manner, we continue to schedule Saturday production, on an overtime basis. We have met with the union representative weekly to discuss any possible alternatives. These alternatives have been very limited and unable to meet the continuing demands. Therefore, we intend to return to the six-day workweek schedule, to include holiday scheduling on a fair and equitable basis.
We will have an informational meeting . . . and we encourage you to attend so we can hear and respond to your questions and concerns. In accordance with the Master Agreement, if you believe there are matters that you wish to negotiate prior to implementation of this decision, you may request to negotiate in accordance with the Labor Agreement. If no such request is received, the proposal will be implemented. If negotiations are requested, we want to schedule them as soon as possible.

Joint Ex. 4.

      The Union responded on the same day, stating that it "has no intentions [sic] of reopening these negotiations. We have a signed MOU which does not have a reopening clause." Joint Ex. 5. The Union requested that the Respondent "[c]ease and desist the implementation of the proposed tour change." Id.

      By memorandum dated March 5, 2002, the Respondent again advised the Union of the planned return to the six-day workweek and stated that "[i]f you plan to negotiate prior to implementation of this scheduling, please notify me as to your availability. If negotiations are requested, we want to schedule them as soon as possible." Joint Ex. 6. In response, and referring to its prior statement, the Union maintained that it "was not reopening the negotiations over these issues. [The Union] stands firm with that decision. . . . At this time we are once again denying your request to reopen these negotiations, and are demanding you cease and desist the implementation of your proposed scheduling changes." Joint Ex. 7.

      By memorandum to the Union dated March 12, 2002, the Respondent stated:

This is in response to your memorandum . . . declaring that [the Union] `stands firm' on its decision to not negotiate CMOP management's proposal to return to a 6-day workweek schedule. Your memorandum clearly indicates that you believe previously negotiated MOUs should remain in force and that management does not have the right to present new proposals without approval of [the Union.]
Management asserts that determination of the operational workweek is its protected right under the Labor Statute. It is an inherent part of determining the mission and number of employees necessary to accomplish the mission. This includes making changes from established workweek schedules when the mission requires, and the MOUs currently in effect do not restrict management from making such changes. Management has not and will not `bargain away' that right. At the same time, management recognizes its obligation to provide opportunity to [the Union] to bargain over the procedures and arrangements/impact and implementation of work schedules. CMOP management has consistently provided that opportunity whenever it has identified the need for a change in work schedules, as evidenced by the MOUs currently in effect. You received notice on January 24, 2002, that CMOP was proposing to return to the [ v60 p846 ] 6-day workweek schedule, and you were given the opportunity to bargain. You responded in writing on January 24, 2002, and again on March 8, 2002, that you would not negotiate.
Management believes that it has met its obligation under the Labor Statute to provide opportunity to negotiate. Therefore, the proposed 6-day workweek schedule will be implemented.

Joint Ex. 8 (emphasis added).

B.      Judge's Decision

      The Judge found that the Respondent's conduct violated the Statute.

      As to the October MOU, the Judge found that the Respondent's implementation of a six-day workweek was inconsistent with the portion of the MOU which provides that "after implementation of two separate shifts, Saturday will be eliminated from the regular tour of duty." Judge's Decision at 14. The Judge found that "[i]n exchange for adding the second shift at the CMOP, [the] Respondent agreed to eliminate Saturday from the regular tour of duty-which was the quid pro quo for the agreement." Id. Applying Dep't of the Air Force, 375th Mission Support Squadron, Scott Air Force Base, Ill., 51 FLRA 858 (1996) (Scott), the Judge also concluded that the Respondent's clear and patent breach of this MOU "goes to the heart of the agreement[,]" finding that "[t]he record fully supports a finding that the Union and the employees viewed the elimination of Saturdays from the regular tour of duty as the essential ingredient of the agreement." Judge's Decision at 15.

      As to the November MOU, the Judge concluded that the Respondent's failure to meet with the Union before determining that it would operate on Saturdays and to seek volunteers for weekend work constituted a clear and patent breach of that agreement. Further, the Judge found that the Respondent's actions went to the heart of the agreement, stating that "how employees would be selected to work on the weekend and procedures to be followed indeed were of paramount concern to employees." Id.

      In reaching these results, the Judge determined that the MOUs are "tied to the [master agreement] and they remain in effect during the effective term of the [a]greement unless changes are negotiated." Id. at 16. The Judge stated that the MOUs were negotiated in accordance with Article 44 of the master agreement and that Article 44 governs midterm bargaining. More specifically, as to the October MOU, the Judge explained that it

was negotiated in accordance with E.O. 12871 as provided in Article 44, Section 1 B, which provision states that if E.O. 12871 is rescinded, nevertheless, ". . . agreements reached during the effective term of this Master Agreement will remain in effect unless changes are negotiated . . . ." This language, I interpret to mean, that agreements reached (i.e. MOUs) during the effective term of the [Master] Agreement, remain in effect for the duration of the [Master] Agreement unless changes are negotiated.

Id. (emphasis in original; citations omitted).

      The Judge found that when workload problems arose in late 2001, the "Respondent could have terminated the [Master] [A]greement." [n3] Id. at 17. The Judge found that the "Respondent did not [do so] and the Agreement thus automatically renewed itself with the renegotiation of the Agreement." Id. Noting that the MOUs did not contain duration clauses, the Judge found that Article 44 gave the MOUs a duration -- namely, "for the term of the Agreement, unless changes are negotiated." Id. (emphasis in original). [n4] The Judge determined that the Union was not obligated to negotiate changes in the MOUs because those agreements remained in effect for the duration of the Master Agreement. See id.

      Based on these findings, the Judge concluded that the Respondent violated § 7116(a)(1) and (5) of the Statute by repudiating the October and November MOUs. As a remedy, the Judge ordered the Respondent to comply with the MOUs.

III.     Positions of the Parties

A.      Respondent's Exceptions

      The Respondent excepts to certain factual findings made by the Judge and to other factual findings that he failed to make. It also excepts to his legal conclusion that the Respondent repudiated the MOUs, and to the remedy.

      The Respondent asserts that the October MOU "was not the result of 7106(b)(1) negotiations[,]" and [ v60 p847 ] that the parties have differing views as to the meaning of paragraph 7. Exceptions at 8 (emphasis omitted). Citing Scott, the Respondent contends that where an agency acts in accordance with a reasonable interpretation of an agreement provision, the agency's breach of the provision is not a clear and patent breach. According to the Respondent, it included paragraph 7 "as a clarification of what the scheduled workweek would be after implementation of the second shift." Id. at 9. The Respondent argues that it was reasonable "to interpret the MOU as allowing it to . . . return to a schedule that incorporated Saturday into the regular workweek, in response to production needs and the welfare of employees." Id.

      The Respondent further argues that its witnesses testified that "by entering into the MOU, management was not forfeiting its right to assign work." Id. at 10. The Respondent contends that it has the "ability to adjust to the workload demands of the VA medical centers[,]" and that in the MOUs it "desired to reserve its right to assign work on Saturdays if that became necessary, which in fact happened." Id. at 12. Citing 5 C.F.R. § 610.121(b)(1), the Respondent asserts that it has "the authority to schedule the work of [its] employees to accomplish the Respondent's mission." [n5] Id. In this regard, the Respondent maintains that to construe the MOUs as "a determination that they removed management's established right to schedule Saturday work[] would be contrary to federal regulations." Id. at 12-13. The Respondent additionally contends:

[T]he intent of the MOUs was only to clarify that the creation of a second shift adequately addressed production needs, such that Saturday would not be scheduled as part of the regular workweek. When production needs changed, the Respondent had the reserved right to return Saturday as a regularly scheduled work day.
The Respondent exercised its right to establish a second shift of work to accommodate a workload increase. To provide clarification to the [Union] that it did not foresee a need to continue operations on Saturday, it expressed its foreseeability in the MOU. The [Judge's] interpretation of the MOU is contrary to federal regulations, such that it strictly limits the Respondent's ability to schedule work on Saturdays. The November 3 MOU admittedly allows the Respondent to schedule work on Saturdays, but only on an overtime basis. Such a condition is not in compliance with the regulation that reserves the scheduling of the regular workweek to management.

Id. at 13.

      The Respondent also maintains that the MOUs were terminable at will because the MOUs do not contain expiration dates and are not directly tied to the master agreement. The Respondent asserts that construing the MOUs as eliminating Saturday from the regular workweek "is impracticable and potentially dangerous" at this time. Id. at 16. The Respondent states that when it implemented a two-shift schedule, management concluded that such a schedule would sufficiently address workload needs. However, when the workload increased because of production demands, the Respondent essentially maintained that it would be seriously handicapped in carrying out its mission of providing pharmaceutical care for veterans. In this regard, the Respondent specifically excepts to the Judge's failure to find that: (1) "the overtime work that resulted from scheduling Saturdays and Sundays caused an increase in prescription errors and employee sick leave usage[;]" (2) "the total number of hours the Respondent's employees worked per week was much greater when Saturday was treated as an overtime day[;]" and (3) the veteran population "has gone from 2.6 million to 6 million, resulting in a twenty-eight percent increase in prescription workload for the Respondent." Id. at 8. The Respondent contends that these findings, which are supported in the record but were not found as facts by the Judge, "all support that the Respondent's production needs were significantly disrupted by adhering to the MOUs." Id.

      Moreover, even assuming, as the Judge found, that the MOUs were negotiated pursuant to Executive Order 12871, the Respondent asserts that after the recission of that Order by Executive Order 13203, it had the authority "to propose changes to the MOUs[.]" Id. at 17. In this connection, the Respondent states that it attempted to negotiate changes to the MOUs and that the Union "emphatically refused to negotiate." Id. According to the Respondent, "[i]f one party is allowed to refuse negotiation of a prior agreement that the other party is allowed to reopen, the reopening will never occur." Id. at 18.

      The Respondent also specifically excepts to the Judge's conclusion that when the Respondent found that overtime scheduled pursuant to the November MOU increased, "it could have terminated the Master Agreement, but because it did not, both MOUs remained in effect after the Master Agreement renewed itself automatically." [ v60 p848 ] Id. at 17. According to the Respondent, the Judge's conclusion is "unreasonable" because "[t]he Respondent, by itself, did not have the authority to terminate the Master Agreement." Id.

      Finally, the Respondent excepts to the remedy ordered by the Judge. The Respondent reiterates that it "made the decision to reschedule Saturdays because production needs required it. In order to meet the demands placed on it by the VA medical centers it serves, and timely mail prescription drugs to veterans, the Respondent had to reincorporate Saturday as part of the regular workweek." Id. at 18. The Respondent asserts that, if a violation is found, any remedy that would preclude the Respondent from scheduling Saturday as part of the regular workweek unless the Charging Party consents "would substantially disrupt the Respondent's mission to timely and safely provide prescription medications to veterans." Id. at 19.

B.      General Counsel's Opposition

      The General Counsel contends that the Judge's conclusion that the Respondent repudiated both MOUs is consistent with Authority precedent and is supported by record evidence.

      As to the October MOU, the General Counsel asserts that the wording of paragraph 7 is "unambiguous" in that it provides for the elimination of Saturday as part of the regular tour of duty. Opposition at 6. With respect to the Respondent's contention that the MOUs conflict with 5 C.F.R. § 610.121(b)(1), the General Counsel argues that the Respondent has presented no evidence that it would be "`seriously handicapped in carrying out its functions or that costs would be substantially increased' if it were unable to schedule employees to work on Saturdays as part of the regular tour of duty." Id. at 9. The General Counsel adds that "because the November 3 MOU contemplates the Respondent's assignment of weekend overtime work, the Respondent cannot seriously contend that the October 16 MOU undermined its ability to `carry out its functions.'" Id.

      The General Counsel also disputes the Respondent's contention that the MOUs were terminable at will. The General Counsel maintains that the Judge correctly found that the MOUs were tied to the master agreement and remained in effect for the duration of the master agreement. See id. at 6-7. The General Counsel rejects the Respondent's claim that Executive Order 13203 permitted the Respondent to unilaterally reopen negotiation on the MOUs. The General Counsel asserts that, under the terms of Executive Order 13203, as well as Article 44 of the master agreement, the revocation of Executive Order 12871 did not affect agreements that were already in place.

      Finally, the General Counsel contends that the Judge's status quo ante remedy is appropriate and is consistent with Authority precedent.

IV.      Analysis and Conclusions

      The complaint alleges that the Respondent impermissibly repudiated the MOUs when it reinstated a tour of duty that includes Saturdays as part of the regular workweek. For the following reasons, we conclude that the Respondent's action of reinstating the tour of duty did not constitute an impermissible repudiation of the MOUs because such action was: 1) authorized by Article 44 of the VA-AFGE Master Agreement; and 2) authorized by applicable government-wide regulations. Accordingly, we will dismiss the complaint.

A.      The Respondent's Action was Authorized by
Article 44 of the Master Agreement

      In Scott, 51 FLRA 858, the Authority set forth the analytical framework it follows for determining whether a party's failure or refusal to honor an agreement constitutes a repudiation of a collective bargaining agreement. The Authority held that it will examine two elements in analyzing an allegation of repudiation: (1) the nature and scope of the alleged breach of the agreement (i.e., was the breach clear and patent?); and (2) the nature of the agreement provision allegedly breached (i.e., did the provision go to the heart of the parties' agreement?). The examination of either element may require an inquiry into the meaning of the agreement provision allegedly breached.

      With regard to the first element, it is necessary to show that a respondent's action constituted "a clear and patent breach of the terms of the agreement[.]" Scott, id. at 862, quoting Cornelius v. Nutt, 472 U.S. 648, 664 (1985) (citation omitted). If the meaning of a particular agreement term is unclear and a party acts in accordance with a reasonable interpretation of that term, that action will not constitute a clear and patent breach of the terms of the agreement. See id. In such a case it is not necessary to examine the second element. See id. at 863-64. Where the second element is analyzed, however, if a provision is not of a nature that goes to the heart of the parties' collective bargaining agreement, a breach of the provision could not amount to a repudiation and, therefore, would not constitute an unfair labor practice. See id. at 863.

      As an initial matter, we find that the Respondent has failed to establish that the Judge erred in determining [ v60 p849 ] that the MOUs were part of, or "tied to," the collective bargaining agreement. The record demonstrates that the index to the master agreement between AFGE and the VA contains one entry for "Memorandums of Understanding." This entry refers to the page on which Article 44, entitled "Mid-Term Bargaining" appears. It is apparent, therefore, that the parties intended to negotiate MOUs consistent with the parties' mid-term bargaining obligations and that such MOUs were to become a part of the parties' agreement. Under these circumstances, we find that the Judge's determinations that the MOUs were negotiated in accordance with Article 44 and were to remain in effect during the term of the agreement are correct and we reject the Respondent's contention that the MOUs were terminable at will.

      Nonetheless, we find that the Judge incorrectly concluded that the Respondent repudiated the MOUs.

      As noted, Article 44 pertains to mid-term bargaining and authorizes negotiations on the "numbers, types, grades of employees, and positions assigned to any organizational subdivision, work project, [or] tour of duty . . ." under § 7106(b)(1) of the Statute and Executive Order 12871. Although the Respondent asserts that the MOUs were not negotiated consistent with Executive Order 12871, the Respondent further asserts that, even if that were the case, "[a] reasonable interpretation of Article 44 of the Master Agreement is that the rescission of Executive Order 12871 allowed either party in this case to propose changes to § 7106(b)(1) issues that were negotiated prior to the rescission date." Exceptions at 17.

      When a defense to an unfair labor practice complaint is governed by the interpretation and application of specific terms of a collective bargaining agreement, as the Respondent asserts with respect to Article 44 in this case, the meaning of the provision must be ascertained. As the Judge's interpretation of the agreement is challenged on exceptions, the Authority must decide whether the Judge's determination is supported by the record and by the standards and principles of interpreting collective bargaining agreements applied by arbitrators and the federal courts. See, e.g., United States Dep't of Veterans Affairs, 57 FLRA 515, 519 (2001); United States Dep't of Justice, INS, Wash., D.C., 52 FLRA 256, 261 (1996); IRS, Wash., D.C., 47 FLRA 1091, 1111 (1993). Therefore, the issue to be resolved in this case is whether the Judge's interpretation of Article 44 of the parties' agreement is supported by the record and by the standards and principles of interpreting collective bargaining agreements applied by arbitrators and the federal courts.

      As relevant here, Article 44, Section 1.B provides that "[i]n the event Executive Order 12871 is rescinded and the Department chooses not to bargain 5 U.S.C. Section 7106(b)(1), either party may reopen this Article to address the 7106(b) issues." That section also provides that "agreements reached during the effective term of this Master Agreement will remain in effect unless changes are negotiated." The Judge concluded that the Union was not obligated to negotiate over the Respondent's proposed changes in the MOUs because those agreements remained in effect for the duration of the master agreement. In reaching this result, the Judge noted that neither MOU had a reopener provision and that Executive Order 13203 provided that "nothing therein shall abrogate any collective bargaining agreement in effect on the date of E.O. 13203 [February 17, 2001]." Judge's Decision at 17. We find that the Judge erred by failing to find that the Respondent had the right, under the terms of Article 44, to negotiate changes to the MOUs.

      The Authority has held that, absent a reopener clause, parties are not permitted to demand mid-term bargaining over matters that are covered by an agreement. See, e.g., United States Dep't of Labor, Wash., D.C., 60 FLRA 68, 72 (2004) (citing United States Dep't of Health & Human Servs., SSA, Balt., Md., 47 FLRA 1004, 1013 (1993)). In this case, Article 44 clearly permitted the reopening of the MOUs in the following respect. [n6] 

      By its terms, Article 44 states that in the event Executive Order 12871 is rescinded and the Respondent chooses not to bargain over § 7106(b)(1) matters, "either party may reopen this Article to address the 7106(b) issues." Article 44 further states that agreements reached during the term of the agreement remain in effect "unless changes are negotiated" and provides that both parties retain their statutory rights.

      E.O. 12871 was rescinded by the promulgation of E.O. 13203. As such, under Article 44, either party was free at that time to reopen Article 44 itself to address "7106(b) issues." [n7] As for agreements that had been reached during the term of the master agreement, such as the October and November 2000 MOUs, the parties [ v60 p850 ] agreed that they would remain in effect unless changes to such agreements were negotiated.

      In interpreting Article 44, the Judge referred to the phrase "unless changes are negotiated" on several occasions but he did not address the meaning of the phrase. As noted above, determining whether there has been a breach of an agreement may require an inquiry into the meaning of the agreement provision allegedly breached. Where the meaning of a particular agreement term is unclear and a party acts in accordance with a reasonable interpretation of that term, that action will not constitute a clear and patent breach of the terms of the agreement.

      A plain reading of Article 44 demonstrates that, by including the phrase "unless changes are negotiated," the parties clearly contemplated that existing agreements covering matters under § 7106(b)(1) of the Statute could be modified during the term of the master agreement. What is less clear, however, is whether mutual assent of the parties is required in order to initiate negotiations or whether one party may invoke the negotiation process. Nothing in Article 44 either expressly requires mutual assent or expressly permits one party to refuse to negotiate when the other party seeks to make scheduling changes. Accordingly, and consistent with the Respondent's rights under § 7106(b)(1) to determine the numbers, types and grades of employees assigned to tours of duty, we find that the Respondent reasonably interpreted Article 44 as allowing it to initiate the bargaining process with respect to the matters contained in the MOUs.

      In this case, the record reflects that, on two occasions, in January and again in March, 2002, the Respondent advised the Union of severe workload problems and the need to return to a six-day work schedule. The Respondent also invited the Union to negotiate and submit proposals. There is no dispute that the Union expressly refused to bargain on both occasions.

      Where, as here, the Respondent acted reasonably in reopening negotiations under Article 44 of the parties' agreement, and the Union refused to bargain, there can be no clear and patent breach of the MOUs. See, e.g., Scott, 51 FLRA 858 (Authority found no repudiation of parties' smoking agreements where respondent was allowed to implement changes without bargaining in various situations). See also Dep't of the Air Force, Air Force Materiel Command, Wright-Patterson Air Force Base, Ohio, 51 FLRA 1532, 1536 (1996) (once adequate notice is given, a union must act to submit proposals, request additional information, or request additional time; a failure to take such action may result in finding that the union waived its right to bargain).

      Accordingly, we find that the Judge erred in concluding that the Respondent could not negotiate changes to the MOUs. [n8] 

B.     The Respondent's Action was Authorized by Applicable Government-wide Regulations

      In addition to the standard set forth above, we note that in order to constitute a repudiation of a collective bargaining agreement provision, the provision at issue must be a lawful one. An agency's failure to follow an illegal agreement provision does not constitute a repudiation of the parties' agreement. See, e.g., Office of the Adjutant Gen., Ga. Dep't of Defense, Atlanta, Ga., 54 FLRA 654 (1998) (respondent's refusal to honor portion of agreement that authorized the use of official time in order to lobby Congress in a support or opposition to pending or desired legislation held not to be unlawful because the use of such time for such purposes was inconsistent with section 8015 of the 1996 DOD Appropriations Act); Gen. Servs. Admin., Wash., D.C., 50 FLRA 136 (1995) (respondent's refusal to honor portion of agreement that authorized combination of work schedules held not to constitute an unlawful repudiation because agreement portion was contrary to the Work Schedules Act); Dep't of the Navy, United States Marine Corps, 34 FLRA 635 (1990) (respondent's repudiation of memorandum of understanding that required it to pay for reflective safety vests that were not used in the performance of work held not unlawful as payment for vests was inconsistent with law).

      In order to be lawful, the MOUs in this case must be read in a manner that allows the Respondent to act in accordance with 5 C.F.R. § 610.121. The Authority has found previously that 5 C.F.R. § 610.121 is a Government-wide regulation. See AFGE, Local 1815, 53 FLRA 606, 619 (1997). As set forth therein, 5 C.F.R. § 610.121(b)(1) requires that agencies: (1) schedule employees' work so as to accomplish the agency's mission, and (2) schedule administrative workweeks to correspond with actual work requirements. [ v60 p851 ] The Authority has held that 5 C.F.R. § 610.121(b) is qualified by 5 C.F.R. § 610.121(a). See United States Dep't of the Navy, Phila. Naval Shipyard, 39 FLRA 590, 604 (1991); NAGE, Local R7-23, 23 FLRA 753, 755-56 (1986).

      5 C.F.R. § 610.121(a) explicitly permits an agency to change employees' work schedules without limitation "when the head of an agency determines that the agency would be seriously handicapped in carrying out its functions or that costs would be substantially increased[.]" 5 C.F.R. § 610.121(a). 5 C.F.R. § 610.121(a) also provides that the basic workweek should be scheduled on Monday through Friday, when possible. However, it is well established that agencies have discretion to deviate from the basic workweek, as the Respondent sought to do by reinstating Saturday as part of the workweek. See Acuna v. United States, 479 F.2d 1356 (Cl. Ct. 1973), cert. denied, 416 U.S. 905 (1974). Furthermore, as we stated in United States Dep't of Commerce, NOAA, Nat'l Weather Serv., 49 FLRA 1563, 1565 (1994) (NOAA), 5 C.F.R. §_610.102 provides that the authority to establish employee work schedules may be delegated by agency heads to lower-level officials. We find here, as the Authority did in NOAA, that it is reasonable to conclude that agency officials who have been delegated authority to establish work schedules for a particular organizational segment also have authority to make changes in those schedules based on consideration of the effects of schedules on that segment. [n9] 

      A proposal or provision that does not allow an agency to change employees' work schedules without limitation pursuant to the situations set forth in § 610.121 is contrary to that regulation. See IAM&AW, 59 FLRA 830, 831-32 (2004) (proposal nonnegotiable that required the agency to schedule, without exception, the third shift basic workweek for five consecutive eight-hour work days, Sunday-Thursday); Haw. Fed. Employees Metal Trades Council, 57 FLRA 450, 452 (2001) (proposal nonnegotiable that required the agency to schedule, without exception, certain employees on the fourth day of a five-day process in which it occasionally drydocked nuclear submarines to either begin work at their normal start times or work fourteen hours); AFGE, Local 1815, 53 FLRA at 619-20 (provision contrary to law that permitted agency to change work schedules with less than seven days notice only when "there is an emergency that would hamper accomplishment of the mission" because it precluded changes when costs would be substantially increased). Thus, to the extent the MOUs were interpreted as not allowing the exercise of this authority, the MOUs would be contrary to the regulation and unenforceable.

      The Respondent argues before the Authority, as it did before the Judge, that it decided to reinstate Saturday as part of the regular workweek because its ability to carry out its function of providing pharmaceutical care to veterans and healthcare providers was being seriously circumscribed. The Respondent states that when it implemented a two-shift schedule following negotiation of the MOUs in 2000, management concluded that such a schedule would sufficiently address workload needs. However, that situation changed and, in 2002, the Respondent advised the Union that changes in the workweek were required and invited the Union to bargain.

      As noted earlier, the Respondent specifically excepts to the Judge's failure to find that: (1) "the overtime work that resulted from scheduling Saturdays and Sundays caused an increase in prescription errors and employee sick leave usage[;]" (2) "the total number of hours the Respondent's employees worked per week was much greater when Saturday was treated as an overtime day[;]" and (3) the veteran population "has gone from 2.6 million to 6 million, resulting in a twenty-eight percent increase in prescription workload for the Respondent." Exceptions at 8. See also Respondent's Posthearing Brief at 10, 13.

      We find that the record supports the Respondent's claims. In this regard, the record shows that, by memorandum of January 24, 2002, the Respondent notified the Union that its workload had continued to increase over the previous six months and was projected to continue to increase. The memo further stated: "The existing schedule has not met the needs and increasing demands of the current work requirements." Joint Ex. 4. The record further shows that a Respondent witness testified, without contravention, that the Respondent decided that the scheduling of employees to perform overtime on Saturdays became excessive and resulted in "more errors occurring" and "sick leave usage." See Tr. at 142-43. In the absence of any assertion or evidence to the contrary, we find that the Judge erred by failing to make findings on these points.

      Because the Respondent's actions were consistent with and satisfied the standards of 5 C.F.R. § 610.121, it did not repudiate the MOUs. Consequently, the [ v60 p852 ] Respondent did not commit an unfair labor practice, as alleged in the complaint.

C.      Conclusion

      For the reasons expressed above, we find that the Respondent did not violate the Statute. Accordingly, we dismiss the complaint.

V.      Order

      The complaint is dismissed.


APPENDIX

5 C.F.R. § 610.121 provides, in relevant part:

(a) Except when the head of an agency determines that the agency would be seriously handicapped in carrying out its functions or that costs would be substantially increased, he or she shall provide that--
(1) Assignments to tours of duty are scheduled in advance of the administrative workweek over periods of not less than 1 week;
(2) The basic 40-hour workweek is scheduled on 5 days, Monday through Friday when possible, and the 2 days outside the basic workweek are consecutive;
. . . .
(b)(1) The head of an agency shall schedule the work of his or her employees to accomplish the mission of the agency. The head of an agency shall schedule an employee's regularly scheduled administrative workweek so that it corresponds with the employee's actual work requirements.
(2) When the head of an agency knows in advance of an administrative workweek that the specific days and/or hours of a day actually required of an employee in that administrative workweek will differ from those required in the current administrative workweek, he or she shall reschedule the employee's regularly scheduled administrative workweek to correspond with those specific days and hours. . . 


File 1: Authority's Decision in 60 FLRA No. 159
File 2: Opinion of Member Pope
File 3: ALJ's Decision


Footnote # 1 for 60 FLRA No. 159 - Authority's Decision

   Member Pope's dissenting opinion appears at the end of this decision.


Footnote # 2 for 60 FLRA No. 159 - Authority's Decision

   Article 44, entitled "Mid-term Bargaining" provides, as relevant here:

Section 1 - General
A. The purpose of this Article is to establish a complete and orderly process to govern midterm negotiations at all levels. . . .
B. In accordance with Executive Order 12871, the Department will bargain on the numbers, types, grades of employees, and positions assigned to any organizational subdivision, work project, tour of duty, and the technology, methods, and means of performing work. . . . In the event Executive Order 12871 is rescinded and the Department chooses not to bargain 5 U.S.C. Section 7106(b), either party may reopen this Article to address the 7106(b) issues. However, agreements reached during the effective term of this Master Agreement will remain in effect unless changes are negotiated. Both parties continue to retain their statutory rights.

Joint Ex. 9 at 171.


Footnote # 3 for 60 FLRA No. 159 - Authority's Decision

   The Judge did not explain how the Respondent (the CMOP in Leavenworth) could have terminated the nationwide Master Agreement, which was entered into at the level of exclusive recognition between the VA and AFGE. The VA is not a respondent in this case.


Footnote # 4 for 60 FLRA No. 159 - Authority's Decision

   The Judge also concluded that the MOUs were not "terminable at will," a matter the Judge raised at the hearing. Judge's Decision at 15; Tr. at 126.


Footnote # 5 for 60 FLRA No. 159 - Authority's Decision

   The relevant provisions of 5 C.F.R. § 610.121 are set forth in the attached appendix.


Footnote # 6 for 60 FLRA No. 159 - Authority's Decision

   The General Counsel disputes the Respondent's claim that Executive Order 13203 permitted the reopening of the MOUs. The GC asserts that, under the terms of that Order, as well as the master agreement, the rescission of Executive Order 12871 had no effect on agreements already in place, such as the MOUs. However, the General Counsel does not address the portion of Article 44 providing that agreements will remain in effect "unless changes are negotiated."


Footnote # 7 for 60 FLRA No. 159 - Authority's Decision

   The fact that E.O. 13203 itself does not abrogate existing agreements does not address any other provisions that parties may have negotiated that authorize the reopening and renegotiation of existing agreements.


Footnote # 8 for 60 FLRA No. 159 - Authority's Decision

   We also disagree with the Judge's finding that the Respondent could have terminated the collective bargaining agreement, and presumably the MOUs, "[w]hen the workload showed evidence of a problem[.]" Judge's Decision at 17. The VA, not the Respondent in this case, is a party to the collective bargaining agreement. The Judge cited no authority by which the Respondent could have taken such an action.


Footnote # 9 for 60 FLRA No. 159 - Authority's Decision

   Although the Gener