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The decision of the Authority follows:
24 FLRA No. 94 NATIONAL FEDERATION OF FEDERAL EMPLOYEES, LOCAL 1374 Union and PACIFIC MISSILE TEST CENTER DEPARTMENT OF THE NAVY Agency Case No. O-NG-1271 DECISION AND ORDER ON NEGOTIABILITY ISSUE I. Statement of the Case This case is before the Authority because of a negotiability appeal filed under section 7105(a)(2)(E) of the Federal Service Labor-Management Relations Statute (the Statute) and concerns the negotiability of the underscored sentence of the following Union proposal: Each affected employee shall be notified of the proposed change in his or her FLSA status. The employee will be given an opportunity to contest the accuracy of this change prior to the effective date of any change. Because the presumption contained at 5 C.F.R. Section 551.203(c) is an easily rebuttable administrative presumption, once an employee has provided any argument that his or her position should be considered nonexempt, the agency must make an independent determination of the employee's status. II. Background This proposal arose in the context of impact and implementation bargaining in connection with Fair Labor Standards Act (FLSA) regulations 5 C.F.R. Part 551, promulgated by the Office of Personnel Management (OPM) at 48 Fed. Reg. 49,494 (1983). These regulations modified and clarified criteria for determining a Federal Employee's exemption status under the FLSA; that is, an employee's entitlement to overtime payment under the FLSA. An "exempt" employee is not entitled to overtime payment under the FLSA; such an employee is entitled, however, to overtime compensation under the provisions of the applicable Federal pay systems. The regulations also were intended to facilitate FLSA administration in the Federal sector and to alleviate the discrepancy between OPM's exemption criteria and the criteria applicable to employees in the private sector. These regulations were involved in judicial and Congressional action which delayed implementation. See generally National Treasury Employees Union v. Devine, 733 F.2d 114 (D.C. Cir. 1984); see also American Federation of Government Employees v. Office of Personnel Management, 618 F. Supp. 1254 (D.D.C. 1985), affirmed, 782 F.2d 278 (D.C. Cir. 1986). They were later republished as proposed regulations at 50 Fed. Reg. 35,529 on August 30, 1985, and were adopted by OPM as final rules without change at 51 Fed. Reg. 7,425 (1986). III. Positions of the Parties The Agency contends that the underscored portion of the Union's proposal is nonnegotiable under section 7117(a)(1) of the Statute because it conflicts with a Government-wide regulation, 5 C.F.R. Section 551.207, /1/ which requires OPM to provide advisory opinions on agency-proposed exceptions to the presumption of exemption for specific occupations at GS-11 or above, set forth in 5 C.F.R. Section 551.203(c), before such exceptions can be made by an agency. /2/ The Union disputes the Agency's position. It contends that the Agency's position ignores the difference between the "exemption for specific occupations" and the rebuttal of the presumption with respect to a specific individual's position. According to the Union, the wording of the regulations, basic statutory FLSA principles, and OPM's past administration of the FLSA support its position that the presumption my be rebutted in individual cases without OPM's approval. Union reply brief at 2-3. IV. Analysis We find that the Union's proposal is outside the duty to bargain. The proposal would require "local agency officials (to) determine (without OPM approval) whether an employee has rebutted the presumption of exemption." Attachment 2 to Union's petition for review at 3. The proposal would require the Agency to make an independent determination of an employee's status under the FLSA, contrary to the requirement of 5 C.F.R. Section 551.207 that such determinations be made, not unilaterally, but in consideration of and subsequent to an advisory opinion of OPM. The regulation requires that OPM "provide advisory opinions on agency proposed exceptions to the presumption of exemption for specific occupations at GS-11 or above . . . which is specified in 5 C.F.R. Section 551.203(c)," and that . . . "(e)xceptions may not be made before OPM consideration," 5 C.F.R. Section 551.207 (emphasis supplied). Section 551.203(c) provides that "(e)xcept as provided in Section 551.207 . . ., any employee properly classified at GS-11 or above . . . shall be presumed to be exempt under this subpart." (Emphasis supplied). These regulations are Government-wide regulations. See Radio Officers Union and National Oceanic and Atmospheric Administration, 19 FLRA No. 80 (1985), slip op. at 7. Considering these sections together, it is our view that any employee properly classified at GS-11 or above is presumed to be exempt unless an exception has been made pursuant to 5 C.F.R. Section 551.207. This interpretation comports with OPM's explanation of how the regulations should operate. For instance, in 50 Fed. Reg. 35,529 (1985), OPM stated: Under these new regulations, it is assumed that if a position is properly classified at the GS-11 or above level . . ., the position would properly be exempt under the provisions of the FLSA. However, we do recognize that there could exist rare occasions when there might be an exception to the presumption. For those unusual situations when an agency feel that an exception might exist, we propose a regulatory procedure for requesting a waiver (see Section 551.207). * * * * * * * After the regulations become effective, all GS-11 and above employees will be presumed to be exempt unless a waiver is granted by OPM. (Emphasis in original). Beyond this explanation, OPM in an earlier issuance of the Federal Register, 48 Fed. Reg. 49,494, 49,495, in responding to a comment concerning 5 C.F.R. Section 551.207, stated: One agency disagreed with the requirement in Section 551.207 that agencies not make exceptions to the presumption of exemption without prior OPM approval. We believe that this requirement for prior approval is necessary in order to assure consistency among agencies and to avoid pay and classification discrepancies. Additionally, in the same issuance of the Federal Register at 49,494 and 49,495, OPM in responding to objections to the presumption of exemption stated: (T)he presumption of exemption can be appealed by either the employee or the employing agency. * * * * * * * Although OPM does not rule out the possibility that certain positions at these grade levels (GS-11 and above) are properly nonexempt, we believe that the combination of the system for waiver requests by agencies and the FLSA administrative appeals system, will allow for the identification of these anomalies. Based upon a reading of the regulations as a whole and noting OPM's explanatory language concerning these regulations, we conclude, contrary to the Union, that 5 C.F.R. Section 551.207 is intended to govern exceptions from the presumption of exemption for all GS-11 employees and above, including individual cases, "in order to assure consistency among agencies and to avoid pay and classification discrepancies." 48 Fed. Reg. 49,495. Because the proposal would require the Agency to make an independent determination of an employee's status under the FLSA without OPM's approval pursuant to 5 C.F.R. Section 551.207, it is inconsistent with the regulations. The proposal therefore is not within the duty to bargain. V. Order The Unions's petition for review is dismissed. Issued, Washington, D.C., December 31, 1986. /s/ Jerry L. Calhoun, Chairman /s/ Henry B. Frazier III, Member /s/ Jean McKee, Member FEDERAL LABOR RELATIONS AUTHORITY --------------- FOOTNOTES$ --------------- (1) 5 C.F.R. Section 551.207 provides in pertinent part: Section 551.207 Exceptions by OPM. The Office of Personnel Management will provide advisory opinions on agency-proposed exceptions to the presumption of exemption for specific occupations at GS-11 or above (or the equivalent level in other white collar pay systems) which is specified in Secion 551.203(c) of this subpart. Exceptions may not be made before OPM consideration. (2) 5 C.F.R. Section 551.203(c) provides: Section 551.203 Exceptions of General Schedule employees. * * * * * * * (c) Except as provided in Section 551.207 of this subpart, any employee properly classified at GS-11 or above (or the equivalent level in other white collar pay systems) shall be presumed to be exempt under this subpart. An agency that properly classifies an employee at GS-11 or above shall be deemed to have satisfied the burden of proof for asserting exemption.