U.S. Federal Labor Relations Authority

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16:0992(130)NG - NAGE Local R4-17 and VA Medical Center, Hampton, Virginia -- 1984 FLRAdec NG

[ v16 p992 ]
The decision of the Authority follows:

 16 FLRA No. 130
 LOCAL R4-17
                                            Case No. 0-NG-856
    The petition for review in this case comes before the Authority
 pursuant to section 7105(a)(2)(E) of the Federal Service
 Labor-Management Relations Statute (the Statute), and raises an issue
 concerning the negotiability of the following Union proposal.
                              Union Proposal
          Cash awards will be granted on a fair and equitable basis.
    Upon careful consideration of the entire record, including the
 parties' contentions, the Authority makes the following determination.
 While the proposal, on its fact, appears unobjectionable, the Union's
 explanation of its meaning and intent raises a negotiability question.
 Specifically, in response to an Authority request for a statement of the
 meaning of its proposal, the Union stated:
          "(T)he key to the meaning and intent of the language, "cash
       awards will be granted on a fair and equitable basis," is that all
       employees in a higher performance category will receive a cash
       award, a cash award based on a percentage of basic per annum
       salary greater than the highest percentage of basic per annum
       salary paid to an employee in a lower performance category.
    It is well established that the right to determine standards which
 employees must meet in order to be rewarded for superior performance is
 subsumed in the right to direct employees and to assign work pursuant to
 section 7106(a)(2)(A) and (B) of the Statute.  See, e.g., National
 Treasury Employees Union and Internal Revenue Service, 14 FLRA No. 77
 (1984) (Proposals 1 and 2), appeal docketed sub nom. NTEU v. FLRA, No.
 84-1292 (D.C. Cir. July 9, 1984).  Thus, in American Federation of
 Government Employees, AFL-CIO, Locals 112, 3269, 3383 and 3831 and
 Department of Health and Human Services, Food and Drug Administration,
 Region V, 15 FLRA No. 171 (1984), the Authority held that Union Proposal
 2, requiring, inter alia8 that "(a)n employee who achieves an
 Outstanding overall performance appraisal . . . shall be granted a
 Quality Step Increase," was nonnegotiable because it interfered with the
 management rights to direct employees and to assign work.  In like
 manner, the instant proposal, as described by the Union, would mandate,
 should management elect to exercise its reserved right to reward an
 employee for performance accomplishments, that all other employees with
 higher levels of performance be accorded a higher degree of recognition.
  Thus the proposal, in effect, prescribes both levels of performance to
 be rewarded and in certain respects the monetary amounts those levels
 will receive.  Hence, based on Internal Revenue Service and Food and
 Drug Administration, Region V, and the reasons and cases cited therein,
 the disputed proposal is outside the Agency's duty to bargain.
    Furthermore, it is also well established that management must
 exercise its right to reward performance within the boundaries of
 applicable laws and Government-wide regulations.  American Federation of
 Government Employees, AFL-CIO, Local 3477 and Consumer Product Safety
 Commission, 14 FLRA No. 67 (1984) (Union Proposal 1 contains a
 discussion of that principle).  In this regard, pursuant to 5 U.S.C.
 4302(b)(4), the Office of Personnel Management (OPM) has issued
 regulations governing the Performance Awards Programs to be established
 in each Executive agency.  /1/ With respect to such programs, Federal
 Personnel Manual Chapter 451, Subchapter 4-2a(8) provides, concerning
 use of an agency's performance appraisal system as a basis for granting
 sustained superior performance awards as follows:
          Because other factors affect award decisions, there should be
       no automatic awards based solely on performance appraisals.  The
       employee's immediate supervisor is in the best position to judge
       which type of recognition most appropriately recognizes the
       contribution and will best motivate the employee.  And supervisors
       have considerable flexibility in matching recognition and
       compensation to performance, for example:  promotion, granting or
       withholding a within-grade increase, and granting a lumpsum cash
       award for past superior performance or a quality increase for
       superior performance that is expected to continue.
 Further, with regard to performance awards, OPM regulations, published
 at 5 CFR 531.606(b) require that performance awards not be mandatory
 except in circumstances not wholly relevant to the instant dispute.  In
 light of these regulatory requirements, the Authority concludes that the
 disputed proposal, as explained by the Union, would require management
 to exercise reserved rights in a manner inconsistent with
 Government-wide regulations.  That is, if the Agency decided to reward a
 single employee, it would be required to reward other employees
 exclusively on the basis of their performance appraisals and,
 additionally, the proposal would mandate the bestowal of performance
 awards on all other employees identified in the proposal.  Consequently,
 the proposal is also outside the Agency's obligation to bargain pursuant
 to section 7117(a)(1) of the Statute, since it is contrary to
 Government-wide regulations.
    Accordingly, pursuant to section 2424.10 of the Authority's Rules and
 Regulations, IT IT ORDERED that the petition for review be, and it
 hereby is, dismissed.
    Issued, Washington, D.C., December 20, 1984
                                       /s/ HENRY B. FRAZIER III
                                       Henry B. Frazier III, Acting
                                       /s/ RONALD W. HAUGHTON
                                       Ronald W. Haughton, Member
                                       FEDERAL LABOR RELATIONS AUTHORITY
 --------------- FOOTNOTES$ ---------------
    /1/ It is concluded that OPM regulations issued pursuant to its
 authority under 5 U.S.C. 4302(b)(4) are Government-wide regulations
 because, under the terms of the statutory grant, they are generally
 applicable to the Federal civilian workforce.  See, e.g., National
 Federation of Federal Employees, Local 1497 and Department of the Air
 Force, Lowry Air Force Base, Colo., 9 FLRA 151 (1982).