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The decision of the Authority follows:

29 FLRA No. 124






Case No. O-NG-736


I. Statement of the Case

This case is before the Authority because of a negotiability appeal filed under section 7105(a)(2)(D) and (E) of the Federal Service labor-Management Relations Statute (the Statute) and concerns the negotiability of seven Union proposals for Nonappropriated Fund (NAF) employees . 1

For the reasons discussed below, the Union's petition for review of Proposals 4, 5, 6, 7 and 8 is dismissed. The Authority Members have reached different conclusions concerning Proposals 2 and 3. The decision and order on these proposals and Chairman Calhoun's dissenting opinion immediately follow this decision.

II. Preliminary Matters

First, the Agency's request to consolidate this case with Case No. O-NG-750 was denied in Service Employees' International Union, Local 556 AFL-CIO and Department of the Army, U.S. Army Support Command, Hawaii, Fort Schafter Hawaii, 26 FLRA 380 (1987) (Fort Schafter) (Chairman Calhoun dissenting on other matters), petition for review filed sub non. Department of the Navy, Marine Corps Exchange, Pearl Harbor v. FLRA, Nos. 87-7220/87-7276 (9th Cir. May 21, 1987).

Second, the Union argues that the Agency's statement of position is not properly before us because it was not signed by the Agency's designated representative of record. The Authority rejected this argument in Fort Schafter, 26 FLRA at 385, based on the reasoning in service Employees International Union, Local 556, AFL-CIO and Department of the Navy Exchange Pearl Harbor, Hawaii, 25 FLRA 796 (1987) (Chairman Calhoun dissenting on other matters) petition for review filed sub nom. Department of the Navy, Marine Corps Exchange, Pearl Harbor v. FLRA, Nos. 87-7161/ 7226 (9th Cir. April 17, 1987). It is rejected here for the same reasons.

Finally, the Union contends that the Agency failed to provide the Union with relevant and pertinent information needed to fully present its position. The Union had requested statistical data as to the number of hours worked by intermittent employees and the length of time (in months) that these employees worked for 2 past years. However, as the Authority determined in Fort Schafter, 26 FLRA at 385, issues as to an Agency's alleged failure to provide information should be raised in an unfair labor practice proceeding, not a negotiability appeal.

III. Proposals 2 and 3

The Authority Members have reached differing conclusions concerning Proposals 2 and 3. The decision and order on these proposals and Chairman Calhoun's dissenting opinion immediately follow this decision.

IV. Proposal 4


Intermittent employees will not be required to serve a probationary period upon conversion to a regular part-time or regular full-time position if the employee has been employed for a period of six (6) months or more. If the employee has been employed for less than six (6) months, such time will be credited towards the six (6) month probationary period.

A. Positions of the Parties

The Agency's position is that the proposal is inconsistent with Agency regulations for which there is a compelling need. The Union disputes this contention.

B. Analysis and Conclusions

Proposal 4 concerns the 6-month probationary period applicable to employees appointed to regular full-time and regular part-time positions. The proposal provides that the probationary period will (1) not apply to employees who served at least 6 months in an intermittent position prior to their conversion; and (2) be offset by the amount of time actually served by an intermittent who served fewer than 6 months. We conclude that the provision is not negotiable because the Agency has shown that the proposal conflicts with an Agency regulation for which there is a compelling need.

The Agency regulation (AR 230-2 (June 1978) at 2-15) provides that an employee receiving an "initial appointment" to a regular full-time or regular part-time position must serve a probationary period. Applicable Department of Defense regulations (DOD Instruction 1401.1-M (January 1981) at chapter II.B.2.f.(l)) set the length of the probationary period at 6 months for NAF employees who are not at the management or executive level. Proposal 4, on the other hand, eliminates or reduces the probationary period for employees who served as intermittents prior to receiving their initial appointments as "regular" employees. As such, the proposal clearly conflicts with the Agency's regulations.

The Agency maintains that a compelling need exists for its regulations because the probationary period is an essential part of the hiring process. We agree.

In the competitive service, the importance of the 1-year probationary period has been recognized by the courts. In Department of Justice v. FLRA, 709 F.2d 704, 730 (D.C. Cir. 1983), the court stated the following:

Congress has long recognized both that federal employees are due certain procedural protections and that federal agencies must be able to terminate employees for unacceptable work performance or conduct. In accommodating these competing concerns, Congress created the concept of the probationary term and authorized agencies to terminate employees summarily during this period. It saw summary terminations as essential to an effective and efficient service, and it has repeatedly acted to preserve agencies' discretion summarily to remove probationary employees.

For competitive service employees, the probationary period is established by law and Government-wide regulation. See 5 U.S.C. 3321; 5 C.F.R. 315.801. The fact that the probationary period for NAF employees is established by Agency regulation does not affect the vital role that the probationary period plays with respect to new appointees, in our view. Indeed, we stated in Service Employees' International Union, Local 556, AFL-CIO and Department of the Navy, Marine Corps Exchange, Kaneohe Bay, Hawaii, 26 FLRA 801, 804-05 (1987):

(T)he probationary period serves the same purpose in NAF employment that it does in the competitive service. It is a trial employment period for the purpose of assessing a newly-hired individual's conduct, reliability, and actual ability to function in a position. It is part of the process by which management determines whether a newly-hired employee should be retained permanently. It provides the Agency with an opportunity to make such judgment prior to-affording employees procedural protections established under Agency regulations or collective bargaining agreements in the event of termination for unacceptable work performance. As in the competitive service, the probationary period is inextricably linked, in our view, with summary termination.

In view of the court's finding that the probationary period in the competitive service is essential to an effective and efficient service, and the Authority's previous finding that the probationary period in the NAF system serves the same purpose as it does in the competitive service, we find that there is a compelling need for the Agency's regulations. Accordingly, we find Proposal 4 to be nonnegotiable on this basis.

In addition, we find that our decision in Marine Corps Exchange, Kaneohe Bay, Hawaii, is applicable to the circumstances of this case. In Kaneohe Bay, we found nonnegotiable a proposal which would have limited the agency's right to summarily terminate a regular NAF employee to the first 90-150 day segment of the 6-month probationary period. We determined that the probationary period including summary termination constituted an essential element of the agency's right to hire under section 7106(a)(2)(A) of the Statute.

In this case, Proposal 4 eliminates that probationary period for new appointees who previously served as intermittents for 6 months or more. The fact that at the time of their conversion to "regular" status these employees are not newly hired into the Agency but rather are newly hired into regular employment is not dispositive, especially since intermittent NAF employees do not serve a probationary period. Rather, the important Agency interests previously identified by the Authority as linked to the probationary period apply whether the employees has been "hired" from outside the Government, or "selected" from the intermittent category.

V. Proposals 5, 6 and 7

Proposal 5


Retention register is defined as the list of employees, except those employees with unsatisfactory ratings, who are serving in the same competitive area and level. The groupings are in descending order with respect to the employee's retention score. Individuals in Groups I and II will not be separated from their competitive level due to reduction in force until all temporary employees and employees with unsatisfactory performance ratings who are serving in the same competitive area and level have been separated from their positions. The retention register shall consist of the following groups of employees:

GROUP I. Regular full-time, regular part-time and regularly scheduled intermittent employees who have completed their probationary period.

GROUP II. Regular full-time, regular part-time, and regulary scheduled intermittent employees serving their probationary period.

Proposal 6


Retention score is the number which reflects all the employee's DOD NAFI service. The score shall be determined in the following manner:

1. The employee will receive 1 point for each full year of creditable service with each additional month of service being represented by decimals. (i.e. three (3) years, eleven (11) months of creditable service is represented by a retention score of 3.11)

Proposal 7

2. An employee will have four (.4) months added to their retention score for any outstanding performance rating received within the last three (3) years.

3. No other consideration will be used in determining employee retention scores.

(The underscored portions of these proposals are in dispute.)

A. Positions of the Parties

The Agency asserts that the Proposal 5 is outside the duty to bargain because it directly concerns nonunit employees and implementation of the requirements of the disputed language, regarding the order of separation of types of employees in a RIF, would affect their employment circumstances.

The Agency also argues that these proposals conflict with its rights under section 7106(a)(2)(A) to assign, layoff and retain employees. The Union contends that the proposals do not impinge on management's rights. It asserts that Proposal 5 is intended to apply only *to employees in the bargaining unit., Union Response at 18-19.

B. Analysis

First, the Agency has not established that Proposal 5 would prescribe conditions of employment for nonunit employees, or that its implementation would affect the conditions of employment of such employees. Based on the Union's explanation of the proposal, the disputed language is intended to cover only employees who are members of the Union's bargaining unit. Since the Union's explanation of its proposal is consistent with the proposed language, we adopt the Union's interpretation for purposes of this decision. We find that the proposal does not apply to nonunit employees simply because, as contended by the Agency, an Agency regulation provides that unit and nonunit employees shall be included in the same competitive areas for RIF purposes. See American Federation of Government Employees, Local 32, AFL-CIO and Office of Personnel Management, 22 FLRA 478 (1986), petition for review filed sub nom. AFGE. Local 32 v. FLRA, No. 86-1447 (D.C. Cir. August 11, 1986).

The Agency does not claim that the regulation upon which it relies is either a Government-wide regulation or an Agency regulation for which a compelling need exists under section 7117(a)(2) of the Statute and section 2424.11 of our regulations.. Consequently, the Agency has not provided any basis under the Statute for finding that the regulation can bar negotiation of Proposal 5.

Second, these proposals are to the same effect as Proposal 3 in Congressional Research Employees Association and Library of Congress. Congressional Research Service, 25 FLRA 306 (1987). In that case Proposal 3 provided that an employee's retention preference would be determined by "type of appointment" ranked in the order specified in the proposal. We found that the proposal would have established criteria for determining the order by which employees would be retained in those positions not eliminated in a RIF. We therefore found that, based on reasoning set forth in the Authority's decision in National Treasury Employees Union and Internal Revenue Service, 7 FLRA 275 (1981), the proposal directly interfered with the agency's discretion to determine which employees should be laid off in violation of management's right under section 7106 (a) (2) (A) to layoff employees. For the reasons set forth in Library of Congress and Internal Revenue Service, we find that these proposals likewise would directly interfere with the Agency's right to layoff employees.

The Union in this case makes no assertion that these proposals are negotiable as appropriate arrangements under section 7106(b) (3) and the record in this case does not provide a basis for such a finding.

We note, however, that subsequent to the filings in this case the Authority issued National Association of Government Employees, Local R14-87 and Kansas Army National Guard, 21 FLRA 24 (1986). In that case, we adopted the "excessive interference" test for determining whether a proposal is negotiable under section 7106(b)(3) and set forth the factors we will consider in applying that test and determining whether a proposed arrangement is appropriate for negotiation or whether it is inappropriate because it excessively interferes with the exercise of management's rights. In this connection, we direct the attention of the parties to our decision in Library of Congress concerning Proposals 1-8. Those proposals, like the present ones, were concerned with RIF situations for employees who are not covered by the regulations issued by the Office of Personnel Management set forth at 5 C.F.R. Part 351. Instead, any RIF affecting them would be governed only by internal regulations issued by the employing agency and the parties' agreement. The decision on whether those proposals constitute appropriate arrangements provides instructive examples of our consideration of relevant factors to determine whether a particular proposal is an appropriate arrangement.

C. Conclusion

Proposals 5, 6, and 7 directly interfere with the right to layoff and are not within the duty to bargain. In view of this finding it is unnecessary to address the Agency's other contentions as to their nonnegotiability.

VI. Proposal 8


When it becomes necessary to reduce the hours of work for employees within the same employment category, the following procedure will be utilized:

Employee(s) hours will be reduced starting with the employee with the least seniority by service date and continuing in an ascending order. The employee with the least seniority will be reduced to the minimum hours allowed for his job category before another employee will be affected. The competitive area for a reduction in hours will be a given shift within the work location.

A. Positions of the Parties

The Agency asserts that this proposal requires that hours of work for employees will be reduced solely on the basis of employees' seniority rankings. Therefore, it argues that the proposal conflicts with management's right to assign work, under section 7106(a) (2) (B) of the Statute, because the proposal would preclude management from assigning work to employees based on their qualifications.

The union argues that the proposal does not affect management's right to assign work because it applies to employees who are in the same job category, working the same shift at the same location.

B. Analysis and Conclusion

This proposal is nonnegotiable. As we explained in National Treasury Employees Union and U.S. Customs Service, Northeast Region, 25 FLRA 731 (1987), union proposals which restrict management's discretion to assign work to individual employees are nonnegotiable unless the record shows that management retains the discretion to determine whether the employees to whom the work may be assigned are equally capable of performing the duties.

The record in this case does not satisfy this requirement. The proposal does not state or imply that Agency management will retain its discretion to determine the qualifications of employees to perform necessary work when it contemplates the reduction of hours of work. Further, the record does not show that Agency management has consistently assigned the same work to each of the employees who would be covered by the proposal. Accordingly, we conclude that this proposal directly interferes with management's right, under section 7106 (a)(2)(B), to assign work. See Independent Letterman Hospital Workers' Union and Department of the Army, Nutrition Care, Letterman Army Medical Center, 29 FLRA No. 43 (1987) (Proposal 1).

VII. Order

The petition for review insofar as it relates to Proposals 4, 5, 6, 7 and 8 is dismissed.

Issued, Washington, D.C., November 6, 1987

Jerry L. Calhoun, Chairman

Henry B. Frazier III, Member

Jean McKee, Member



I. Proposal 2


Full-time, part-time, and regularly scheduled intermittent employees shall observe the following holidays:

First day of January (New Year's Day)
Third Monday of February (Presidents Day)
Last Monday of May (Memorial Day)
Fourth day of July (Independence Day)
First Monday of September (Labor Day)
Second Monday of October (Discoverer's Day)
Eleventh day of November (Veterans Day)
Fourth Thursday of November (Thanksgiving Day)
Twenty-fifth day of December (Christmas Day)
The Employee's Birthday (If an employee's birthday
falls on February 29th, it will be celebrated on
February 28th.

Any other day designated as a holiday by Federal statute or Executive Order.

A. Positions of the Parties

The Agency states that (1) the entire proposal is outside the duty to bargain because it does not pertain to conditions of employment of bargaining unit employees; and (2) the underscored portion is inconsistent with Agency regulations for which there is a compelling need. The Union disputes these contentions.

B. Analysis and Conclusions

1. The Proposal Concerns a Condition of Employment

In American Federation of Government Employees AFL-CIO, Local 1897 and Department of the Air Force, Eglin Air Force Base, Florida, 24 FLRA 377 (1986) the Authority held that nothing in the Statute, or its legislative history, bars negotiation of proposals relating to pay and fringe benefits insofar as (1) the matters proposed are not specifically provided for by law and are within the discretion of the agency and (2) the proposals are not otherwise inconsistent with law, Government-wide rule or regulation or an agency regulation for which a compelling need exists. Based on that analytical framework, we held the proposal in that case, which required the agency to pay up to 75 percent of the premium cost of health insurance for NAF employees, to be within the duty to bargain.

The present case involves leave benefits for NAF employees, which are matters not governed by law, but by agency regulations. Since leave benefits for these employees are not a matter specifically provided for by Federal statute, this matter is not excepted from the definition of conditions of employment under section 7103(a)(14)(C) of the Statute.

2. The Agency Has Not Establish a Compelling Need for Its Regulations to Bar Negotiations

To establish that a proposal is nonnegotiable on the basis of compelling need, an agency must (1) identify a specific agency-wide regulation; (2) show that there is a conflict between its regulation and the proposal; and (3) demonstrate that its regulations are supported by a compelling need with reference to the Authority's illustrative standards set forth in section 2424.11 of the Authority's Rules and Regulations (5 C.F.R. 2424.11). Generalized and conclusionary reasoning does not support a finding of compelling need. American Federation of Government Employees, AFL-CIO Local 3804 and Federal Deposit Insurance Corporation, Madison Region, 21 FLRA 870 (1986) (Proposal 7).

The Agency asserts that, because the proposal would grant employees' birthdays as a holiday and more generally would provide leave benefits to intermittent employees, it conflicts with the Department of Defense Personnel Policy Manual for Nonappropriated Fund Instrumentalities and other Agency regulations authorizing leave benefits only to regular full-time and regular part-time employees. The Agency contends that the regulatory provisions meet the Authority's criterion for determining compelling need set forth in 5 C.F.R. 2424.11(a). That is, It claims that the regulations are essential, as distinguished from helpful or desirable, to the accomplishment of their missions in a manner which is consistent with the requirements of an effective and efficient government. In support, the Agency states that the regulations are necessary to maintain a viable NAF system. The Agency does not demonstrate why this is so or provide any, basis for finding that this goal could not be achieved through means other than the regulations at issue. It also fails to show that the proposals would result in significant and unavoidable costs not offset by compensating benefits. See Lexington-Blue Grass Army Depot, Lexington, Kentucky and American Federation of Government Employees, AFL-CIO, Local 894, 24 FLRA 50 (1986), in which