12:0019(7)CA - IRS and Brookhaven Service Center and NTEU and NTEU Chapter 99 -- 1983 FLRAdec CA
[ v12 p19 ]
The decision of the Authority follows:
12 FLRA No. 7 INTERNAL REVENUE SERVICE AND BROOKHAVEN SERVICE CENTER Respondent and NATIONAL TREASURY EMPLOYEES UNION AND NATIONAL TREASURY EMPLOYEES UNION CHAPTER 99 Charging Party Case No. 2-CA-606 DECISION AND ORDER The Administrative Law Judge issued the attached Decision in the above-entitled proceeding, finding that the Respondent had engaged in certain unfair labor practices alleged in the complaint and recommending that it be ordered to cease and desist therefrom and take certain affirmative action. Thereafter, the Respondent filed exceptions to the Judge's Decision with a supporting brief. Pursuant to section 2423.29 of the Authority's Rules and Regulations and section 7118 of the Federal Service Labor-Management Relations Statute (the Statute), the Authority has reviewed the rulings of the Judge made at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. Upon consideration of the Judge's Decision and the entire record, the Authority hereby adopts the Judge's findings, conclusions and recommendations only to the extent consistent herewith. The Judge concluded that the Internal Revenue Service and Brookhaven Service Center (the Respondent) violated section 7116(a)(1) and (5) of the Statute by failing to bargain with the Charging Party, National Treasury Employees Union (NTEU) and NTEU Chapter 99 concerning the procedures to be utilized in implementing, and appropriate arrangements for employees adversely affected by, the Respondent's "unmeasured" system of evaluation to a "measured" system. In this regard, the Judge found that the Respondent announced its intention to implement such conversion; that NTEU requested negotiations over the substance, impact and implementation thereof; that the Respondent asked NTEU to submit specific proposals concerning the change; that NTEU submitted twelve proposals as requested; that the Respondent declared all twelve proposals nonnegotiable in a response to NTEU approximately two months later; and that the Respondent effectuated the conversion several weeks thereafter. The Judge further found, contrary to the Respondent's contentions, that three of NTEU's twelve proposals /1/ "all relate to the equal distribution of work and are negotiable because they concern the quantity of work to be assigned to each employee and . . . that impacts directly on each employee's potential output. Those proposals do not conflict with management's right to assign a particular type of work to an employee." /2/ Accordingly, he concluded that the Respondent's refusal to bargain concerning these three proposals, thereby instituting a conversion to a measured system of evaluation without giving NTEU an opportunity to bargain with respect to the implementation and impact of the conversion, constituted a violation of section 7116(a)(1) and (5) of the Statute. To remedy the violation found, the Judge concluded that a status quo ante remedy would be appropriate. While the Authority agrees with the Judge's findings that the Respondent was required to notify NTEU of the decision to change from an unmeasured to a measured system of performance evaluation for the employees in its "Dishonored Check" unit and to bargain with NTEU upon request concerning the procedures which management will observe in implementing the change and concerning appropriate arrangements for employees adversely affected, the Authority disagrees with the Judge's conclusion that the Respondent violated section 7116(a)(1) and (5) of the Statute in the circumstances of this case. Thus, as found by the Judge, NTEU in fact received adequate notice of the Respondent's intended change and an opportunity to submit specific proposals concerning the impact and implementation thereof. NTEU then submitted twelve proposals, all of which were considered and declared nonnegotiable by the Respondent before the change was implemented. As stated above, the Judge's finding of an unlawful refusal to bargain was based on his conclusion that three of the disputed proposals are within the Respondent's duty to bargain. However, the Authority concludes that the three proposals at issue (supra n. 1) directly interfere with management's right to assign work within the meaning of section 7106(a)(2)(B) of the Statute, /3/ and therefore are not within the Respondent's duty to bargain. Thus, contrary to the Judge's conclusion that the disputed proposals "do not conflict with management's right to assign a particular type of work to an employee," the Authority finds that the literal language of the proposals would require the Respondent to distribute an equal amount of all types of work to all employees in the unit. In National Treasury Employees Union and Department of the Treasury, Bureau of the Public Debt, 3 FLRA 769 (1980), at 775, affirmed sub nom. National Treasury Employees Union v. Federal Labor Relations Authority, No. 80-1895 (D.C. Cir. Oct. 12, 1982), the Authority stated: The right to assign work to employees or positions under section 7106(a), subject to the provisions of section 7106(b), is composed of two discretionary elements: (1) the particular duties and work to be assigned, and (2) the particular employees to whom or positions to which it will be assigned. (Footnote omitted) All of the disputed proposals would directly interfere with both discretionary elements by requiring management to assign all types of work to all employees in the organizational unit and in an equal amount. See also National Treasury Employees Union and Department of the Treasury, Internal Revenue Service, 7 FLRA No. 35 (1981). /4/ Accordingly, the Authority concludes that the Respondent did not violate its duty to bargain in good faith with NTEU, /5/ and that the complaint alleging a violation of section 7116(a)(1) and (5) of the Statute must be dismissed. ORDER IT IS ORDERED that the complaint in Case No. 2-CA-606 be, and it hereby is, dismissed. Issued, Washington, D.C., April 22, 1983 Barbara J. Mahone, Chairman Ronald W. Haughton, Member Henry B. Frazier III, Member FEDERAL LABOR RELATIONS AUTHORITY -------------------- ALJ$ DECISION FOLLOWS -------------------- Elliot M. Carlin, Esq. For the Respondent Allan W. Stadtmauer, Esq. For the General Counsel David H. Lipton For the Charging Party Before: ALAN W. HEIFETZ Administrative Law Judge DECISION Statement of the Case This proceeding arose pursuant to the Federal Service Labor-Management Relations Statute, 5 U.S.C. 7101 et seq., as a result of an unfair labor practice charge filed on September 19, 1980, with the Federal Labor Relations Authority. Consequently, on November 28, 1980, the Acting Regional Director, Region II, of the Authority issued a complaint alleging that Respondent violated Sections 7116(a)(1) and (5) of the Statute by refusing to negotiate in good faith with the Charging Party concerning "the impact of and procedure for implementing its decision to measure the output of employees in its dishonored check unit." Respondent denies that allegation and moves to dismiss the complaint for failure to make a prima facie. A hearing was held on February 3, 1981, in Holtsville, New York. All parties are afforded full opportunity to be heard, to examine witnesses and to introduce evidence. Post hearing briefs have been filed /6/ and considered. /7/ Upon the entire record, including my observation of the witnesses and their demeanor, I make the following findings, conclusions and recommendations. Findings of Fact At all times material to this case, Respondent and the Charging Party have been parties to a collective bargaining agreement covering unit employees at the Brookhaven Service Center (BSC). Chapter 99 has acted for and on behalf of NTEU at BSC and has been recognized as the exclusive bargaining agent consistent with the parties' adherence to the Multi-Center agreement known as MCA-II. Unit employees of the Dishonored Check Function process debit vouchers issued by IRS' depository banks when they dishonor certain taxpayers' checks. The banks may return checks to the IRS for a variety of reasons, e.g. insufficient funds, encoding errors, and missing checks. A debit is entered against the corresponding credit given to the taxpayer when the remittance in question was originally received. Basic dishonored checks are worked by all employees in the Dishonored Check Function although certain employees additionally work encoding errors, missing checks, correspondence and adjustments. There are now five permanently assigned employees in this unit although there are hired seasonable or WAE (when actually employed) tax examiners during peak work periods. The Dishonored Check Function has been merged with the Unidentified Check Unit which determines the source and application of funds derived from checks of unknown origin. That unit has four permanently assigned employees as well as an indeterminate number of seasonal and WAE employees. In the Unidentified Check Unit each check is considered to be a single case file to be investigated and, therefore, the work is easily distributed on an even basis. However, in the Dishonored Check Unit, banks send in packages of twenty to fifty checks each which cannot be split up and are, therefore, assigned to individual employees by the package, regardless of the total number of checks in each package. By memorandum dated April 25, 1980, management at BSC announced its intention to convert the Dishonored Check Unit from an "unmeasured" (not subject to numerical evaluation) system of evaluation to a "measured" (numerically evaluated) system. The terms of "unmeasured" and "measured" are described in the collective bargaining agreement under Article 6 (Promotions) and Article 26 (Furlough and Recall, Seasonal Employees). By memorandum dated May 1, 1980, the Charging Party requested negotiations over the substance, impact and implementation of the intended conversion. On May 9, 1980, Respondent requested that the Charging Party submit its proposals concerning the change by May 23 and it announced its intention to implement the procedure on June 2, 1980. The Charging Party submitted twelve proposals on May 22, 1980. Respondent declared all twelve proposals non-negotiable by a response dated August 1, 1980, and the conversion was effectuated on or about August 25, 1980. Both before and after the conversion, tax examiners reported their time and volume on weekly Employee Time Reports as well as a weekly inventory sheet. Data from the Employee Time Reports were compiled into Individual Performance Reports (IPR's) which were available to employees both before and after the conversion. However, before the conversion, the IPR's had little significance, if any, to those employees. The data was also kept by a former supervisor in the form of a "blotter record" which she used in the process of her evaluation of employees to be furloughed or recalled, although there was no evidence that this "blotter record" was used to evaluate permanent employees. The conversion resulted in no change of job function, assigned tasks or method of reporting output. However, employees at a Union meeting expressed a number of concerns over the significance of the change from an "unmeasured" to a "measured" method of evaluation. They were most concerned that equitable distribution of work was impossible in the Dishonored Check Unit since batches of checks were not numerically uniform. They were concerned that not all employees in the unit knew how to perform the full range of functions which were to be placed into the various production codes. They were concerned that those who knew how to type could use the computers faster than those who could not type and that therefore, the former would be able to work faster than the latter. They were concerned about the quality and proximity of research material necessary to the completion of individual examinations. /8/ They were concerned that any emphasis on quantity would have a detrimental effect on both the quality of the work and the cooperative attitude among fellow employees. They were concerned that some functions were easier than others and that the easier the function to which one might be assigned, the greater the production coefficient that might be achieved. And finally, they were concerned that "nullifieds", cases in which errors were made, would be distributed unequally and to those who had not caused the error, all to the disadvantage of an employee who was attempting to keep his or her production at a high level. Discussion and Conclusions The General Counsel argues that the conversion from an unmeasured to a measured system of evaluation is a change in personnel policies and practices, that the change had a significant impact which required negotiation over that impact and the implementation of the change, and that the Union's proposals were negotiable. Respondent, on the other hand, argues that neither a change in working conditions, personnel policies or practices, nor impact or any such change, has been proven; that the Union failed to submit any negotiable proposals; and that any obligation to bargain over impact and implementation has been satisfied by the provisions of the parties' collective bargaining agreement. There is no question that on April 25, 1980, Respondent announced its intention to "convert" the Dishonored Check Function to a measured evaluation. There is also no doubt that the term "conversion" is not a metaphysical abstraction; it is, simply put, a synonym for the word "change." And a conversion from one system of evaluation to another is a change from one to the other. The fact that there is no physical change in the work to be done by employees or in the method of reporting their output does not belie that a change has taken place. Although the differences between subjective and objective evaluation might be subtle, their ramifications are not. Consider, by way of analogy, the conversion at a university from a pass-fail system to a numerically graded system. There is no question that students must take the same courses to fulfill their major requirements. There is no question that they must attend classes at the appointed hour, read the required texts, devote the same amount of time to homework assignments, and take final examinations. In short, the students must perform exactly the same tasks under either system. It is only after the student performs, after the examination is turned in for a grade, that the system of evaluation becomes significant. U under the pass-fail system, the student is concerned only whether he or she has passed the various courses. A student who passes is one of a large, otherwise undifferentiated class of persons who have demonstrated only that they have met the minimum qualifications set by the institution. The system of evaluation does not permit a ranking of students solely by which selection to an honorary society or to a graduate school might be made. On the other hand, under a numerically graded system, each student is ranked in a manner by which his or her individual standing in the class may be determined. A numerical grade not only indicates whether the student has passed or failed, but it also indicates whether the student is a candidate for the dean's list or is in danger of being placed on probationary status. There is no less change in the case at bar. Under the unmeasured system, employees are rated on the merits of their individual performance; under the measured system, they are rated on the basis of their performance as it relates to the performance of their peers. /9/ Clearly, under the measured system numerical output becomes significant and anything which affects the "numbers" an employee is able to show, affects that employee's relative ranking for purposes of promotion or, in the case of seasonal or WAE employees, for furlough and recall. Thus, the numerical output of an employee is directly dependent upon the number of cases assigned to that employee; an unequal distribution of work must correspond to an unequal production coefficient, all other things being equal. Similarly, where numerical production is dependent upon computer operational skill, the employee who knows how to type will be able to outperform one who must "hunt" and "peck" at the console. Finally, where there is pressure to produce numbers, the competitive atmosphere, while it may spur many to higher productivity, also tends to decrease cooperative attitudes among the competitors where helping a colleague to a promotion is viewed as helping yourself out of one. Respondent argues that there is no evidence of any difference in training or in collection of data, of actual rating of employees under the new system, of any detailing or adverse or disciplinary action taken against any employee, or of any seasonal adjustment in the composition of the unit. Although the evidence is so limited, there is no requirement under the Statute that actual impact must be demonstrated. In the temporal world of labor relations, the Union need not offer up a paschal lamb in order to put the covenant on the table. All that is required is a demonstration of a reasonable likelihood that the change would result in a substantial impact adversely affecting employees, either immediately or in the future. /10/ Such a standard is consistent with the legislative history of the Statute which indicates that in exchange for a strong management rights clause, Congress intended to broaden the scope of collective bargaining, including the specific area of adverse effects resulting from the exercise of those management rights. /11/ The Authority has recognized this relationship between management rights and the duty to bargain over impact and implementation where performance standards have been set by management and the union seeks negotiations to assure that those standards are fair and equitable. /12/ Under those circumstances, the Authority found a duty to bargain. I conclude that under the circumstances of this case, the duty to bargain in good faith must also obtain since there is a reasonable likelihood that employee's prospects for promotion, furlough and recall will be substantially impacted by the application of a changed method of performance evaluation. Turning to the specific proposals for negotiation, Respondent argues that none is negotiable and the General Counsel concedes that certain unspecified proposals arguably go to the substance of the decision to measure employee output. Clearly proposal number 1, that the Dishonored Check work remain unmeasured, goes solely to the substance of the decision and is not negotiable. Proposal 2, that all employees be cross-trained, has not been shown to be negotiable because by terms of the collective bargaining agreement, employees may be measured only against those who perform the same function /13/ and therefore, there would be no reason to train an employee in a function to which the employee would not be assigned. Proposals 3, 5 and 6 all relate to the equal distribution of work and are negotiable because they concern the quantity of work to be assigned to each employee and, as previously discussed, that impacts directly to each employee's potential output. Those proposals do not conflict with management's right to assign a particular type of work to an employee. Proposal 4, that "nullifieds" not be measured, is similar to proposal 1 and goes to the substance of the decision to measure. As proposed, it is not negotiable. Proposals 7 through 10 seek separate reporting of several functions. There is insufficient record evidence upon which I could base a conclusion as to the negotiability of those proposals; /14/ the impact is not obvious on their face. Finally, proposals 11 and 12, concerning the easy accessibility and proper indexation of research materials, do not relate directly to, nor impact on the decision to convert to a measured evaluation. The change in the location of the research tools was unrelated to the decision to convert and, in any event, their location and indexation affects all users equally. Under the circumstances, those two proposals have not been shown to be negotiable. By instituting the conversion to a measured system of evaluation without giving the union an opportunity to bargain with respect to the implementation and impact of the conversion, I conclude that Respondent has violated Sections 7116(a)(1) and (5) of the Statute. Further, I conclude that a status quo ante remedy is appropriate since it is the only meaningful and effective way to remedy the violation and the record fails to establish that such a remedy would create a serious disruption of Respondent's operations. /15/ Accordingly, I recommend that the Authority issue the following order: ORDER Pursuant to Section 2423.29 of the Rules and Regulations of the Federal Labor Relations Authority and Section 7118(a)(7)(A) of the Federal Service Labor-Management Relations Statute, the Authority orders that the Internal Revenue Service and its Brookhaven Service Center shall: 1. Cease and desist from: (a) Instituting any conversion of the Dishonored Check Unit from an unmeasured to a measured system of evaluation without first affording the National Treasury Employees Union Chapter 99 a reasonable opportunity to negotiate, to the extent consonant with law and regulations, on the impact and implementation of such conversion. (b) In any like or related manner, interfering with, restraining or coercing employees in the exercise of rights assured by the Federal Service Labor-Management Relations Statute. 2. Take the following affirmative action in order to effectuate the purposes and policies of the Statute: (a) Rescind and withdraw all evaluations of employees in the Dishonored Check Unit represented by the National Treasury Employees Union Chapter 99, which were made under the measured system of evaluation instituted on or about August 25, 1980, reevaluating employees where necessary. (b) Notify the National Treasury Employees Union Chapter 99 of any intention to institute a conversion of the Dishonored Check Unit to a measured system of evaluation and, upon request, consult and negotiate with such representative, to the extent consonant with law and regulations, concerning the impact and implementation of such action. (c) Post at its facilities copies of the attached notice marked "Appendix" on forms to be furnished by the Federal Labor Relations Authority. Upon receipt of such forms they shall be signed by the Director, Brookhaven Service Center, and shall be posted and maintained for 60 consecutive days thereafter in conspicuous places, including all bulletin boards and other places where notices are customarily posted. Reasonable steps shall be taken to ensure that the notices are not altered, defaced or covered by any other material. (d) Notify the Federal Labor Relations Authority in writing within 30 days from the date of this Order as to what steps have been taken to comply with the Order. ALAN W. HEIFETZ Administrative Law Judge Dated: April 21, 1981 Washington, DC APPENDIX NOTICE TO ALL EMPLOYEES PURSUANT TO A DECISION AND ORDER OF THE FEDERAL LABOR RELATIONS AUTHORITY AND IN ORDER TO EFFECTUATE THE POLICIES OF CHAPTER 71 OF THE TITLE 5 OF THE UNITED STATES CODE FEDERAL SERVICE LABOR-MANAGEMENT RELATIONS WE HEREBY NOTIFY OUR EMPLOYEES THAT: WE WILL NOT institute any conversion of the Dishonored Check Unit from an unmeasured to a measured system of evaluation without first notifying the National Treasury Employees Union Chapter 99 and affording it the opportunity to consult and negotiate, to the extent consonant with law and regulations, concerning the impact and implementation of such change. WE WILL NOT in any like or related manner interview with, restrain or coerce our employees in the exercise of their rights assured by the Federal Service Labor-Management Relations Statute. WE will rescind and withdraw all evaluations of employees in the Dishonored Check Unit represented by the National Treasury Employees Union Chapter 99, which were made under the measured system of evaluation instituted on or about August 25, 1980, and will issue reevaluations where necessary. WE WILL notify the National Treasury Employees Union Chapter 99 of any intention to institute a conversion of the Dishonored Check Unit to a measured system of evaluation and, upon request, consult and negotiate with such representative, to the extent consonant with law and regulations, concerning the impact and implementation of such action. (Agency or Activity) Dated: By: (Signature) This Notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced or covered by any other material. If employees have any questions concerning this Notice or compliance with any of its provisions, they may communicate directly with the Regional Director of the Federal Labor Relations Authority, Region II, 26 Federal Plaza, New York, New York 10278. --------------- FOOTNOTES$ --------------- /1/ NTEU proposals 3, 5 and 6, referred to by the Judge, state as follows: 3. The supervisor will insure an equal distribution of work according to the dates and types of work to all employees in the unit. 5. Return mail will be equally distributed among all employees in the unit. 6. Foreign checks will be equally distributed among all employees in the unit. /2/ The Judge found that the other nine proposals were nonnegotiable or were not shown to be negotiable. Neither NTEU nor the General Counsel filed exceptions to such findings, and especially noting the absence of exceptions, the Authority adopts the Judge's decision in this respect. /3/ Section 7106(a)(2)(B) provides: Sec. 7106. Management rights (a) Subject to subsection (b) of this section, nothing in this chapter shall affect the authority of any management officials of any agency-- * * * * (2) in accordance with applicable laws-- * * * * (B) to assign work, to make determinations with respect to contracting out, and to determine the personnel by which agency operations shall be conducted(.) /4/ Cf. Association of Civilian Technicians and State of Georgia National Guard, 2 FLRA 581 (1980), wherein the Authority found negotiable a portion of a proposal which required assignment of cleanup duties on a fair and equitable basis. There, the Authority stated, " . . . the second paragraph of the proposal merely provides that, once management has decided to require a general cleanup and has determined which employees will perform such duties, management will distribute specific assignments to such duties on a fair and equitable basis. Since there is no showing that a procedure to distribute cleanup assignments equitably will prevent management from acting at all in assigning general cleanup duties to technicians, the procedure in question is within the duty to bargain under section 7106(b)(2) of the Statute . . . ." Here, as previously stated, NTEU's proposals, by requiring assignment of work "equally," would remove the Respondent's discretion to decide which employees will perform which type of work. /5/ The ALJ's finding of an unfair labor practice was based solely on his conclusions regarding the three proposals determined here to be outside the duty to bargain. There is no evidence that the Respondent otherwise refused to negotiate concerning procedures to be utilized in implementing, and/or appropriate arrangements for employees adversely affected by the change. /6/ Good cause not having been shown, Respondent's motion to file a reply brief was denied on April 1, 1981. /7/ Respondent's motion to correct the hearing transcript is hereby granted. /8/ These research tools, the RPS and encoding books, were physically moved away from the employees in the Dishonored Check Unit some months after, and without any connection to, the conversion. They remain equally accessible to all employees in that unit although it will take them all more time to do their research because of the change in proximity. /9/ For example, Article 6, Section 6(B), of the collective bargaining agreement makes the following contrast: 1. Quantity of Work Produced/Utilization of Time (a) Measured Work - Quantity of units produced. Compare output with average production of other employees at the same grade in the same Branch for each program and function worked. (b) Unmeasured Work - A measure of the employee's effectiveness in using his/her time to accomplish assigned duties. 2. Quality of Work Produced (a) Measured Work - A measure of how accurately employees at the same grade level in the same Branch working the same program and function perform their duties. (b) Unmeasured Work - A measure of how accurately and thoroughly an employee performs his/her duties. /10/ The "reasonable likelihood" test was enunciated by Administrative Law Judge Francis E. Dowd in U.S. Government Printing Office and Joint Council of Unions, GPO. Case No. 3-CA-549 (April 9, 1981). Although the Dowd doctrine has not yet been reviewed by the Authority and, therefore, is not binding, I adopt it for purposes of this decision for the cogent reasoning expressed by Judge Dowd in that case. /11/ Legislative History of the Federal Service Labor-Management Relations Statute, Title VII of the Civil Service Reform Act of 1978, Committee Print No. 96-97, Committee on Post Office and Civil Service, House of Representatives 96th Cong., 1st Sess., Nov. 19, 1979; pp. 826, 932, 933.