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The decision of the Authority follows:
30 FLRA NO. 129 30 FLRA 1170 28 JAN 1988 ASSIGN WORK APPLICATION OF MGT'S RIGHT AWARD PROGRAM NATIONAL TREASURY EMPLOYEES UNION Union and INTERNAL REVENUE SERVICE, INDIANAPOLIS DISTRICT Agency Case No. O-NG-1412 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). It concerns the negotiability of a proposal submitted in response to the Agency's notification that it intended to implement a "Supervisor's Appreciation Award" in the amount of $100 to recognize and reward employees for special contributions to quality service and quality work products. For the reasons which follow, we find that the Union's proposal does not conflict with the Agency's rights to direct employees and assign work and is within the duty to bargain. II. Union Proposal The accomplishment of the following shall automatically entitle a bargaining-unit employee to a Supervisor's Appreciation Award: A. Any bargaining-unit employee who receives an overall-average rating of four (4) or more on any one (1) evaluation. B. Any bargaining-unit employee who has served as many as thirty days on special assignments or details during a fiscal year and has been rated as having satisfactorily performed the assignments or details. III. Positions of the Parties The Agency contends that this proposal conflicts with management's rights to direct employees and assign work under section 7106(a)(2)(A) and (B) of the Statute because it would "establish performance standards and require the issuance of a Supervisor's Achievement Award if those standards are met." Agency Statement of Position at 3. The Union contends that its proposal does not interfere with the Agency's rights to direct employees and assign work. It denies that the proposal prescribes the content of performance standards. Union Petition for Review at 1. it claims that the proposal concerns the application of "standards established unilaterally by the Agency." Union Response at 4. IV. Analysis and Conclusion The proposal sets forth circumstances when an employee will be entitled to receive the Supervisor's Appreciation Award of $100 established by the Agency. An employee automatically receives an award under the proposal if that employee (1) receives "an overall average rating of four (4) or more on any one (1) evaluation" and/or (2) has served an aggregate of at least 30 days on special assignments or details during a fiscal year and was "rated as having satisfactorily performed the assignments or details." The Agency argues that in American Federation of State, County, and Municipal Employees, AFL - CIO, Locals, 2477 and 2910 and Library of Congress, 17 FLRA 786, 788-89 (1985) (Union Proposals 2 and 3), the Authority held proposals like the one at issue here to be nonnegotiable. Those proposals prescribed the levels of achievement under the Agency's performance appraisal system which would entitle an employee to an award. The Authority held that the proposals were nonnegotiable because they interfered with management's rights to direct employees and assign work through the establishment of rewards for employee performance. The Authority relied on its previous decision in National Treasury Employees Union and Internal Revenue Service, 14 FLRA 463 (1984) (Proposals 5 and 6). We find, as explained below, that the basis for the Authority's decision in Library of Congress has been overruled, and the Agency has not supported its claim that the proposal interferes with management's rights to assign work and direct employees. In NTEU v. FLRA, 793 F.2d 371, 374 (D.C. Cir. 1986), the court ruled that the management right to assign work does not include a right to reward superior performance of work which has been assigned and remanded the case for further proceedings. Subsequently, based on its decision in NTEU v. FLRA, the court, in an unpublished memorandum decision, reversed and remanded the Authority's decision in Department of the Navy, Northern Division, Naval Facilities Engineering Command and National Federation of Federal Employees, Local 1430, 19 FLRA 705 (1985). NFFE, Local 1430 v. FLRA, No. 85-1648 (D.C. Cir. Nov. 6, 1986). In Naval Facilities Engineering Command, the Authority had determined that the agency did not commit an unfair labor practice by unilaterally changing the functions of the incentive awards committee on which the union had a role as an observer. In reaching that outcome, the Authority had found that the determination of "whether certain performance warranted an incentive award" is within management's authority to assign work and direct employees. Id. at 707. The court reversed the Authority's decision, stating that the basis for it had been rejected by the court in its decision in NTEU v. FLRA. Based on these two decisions of the D.C. Circuit Court of Appeals, in American Federation of Government employees, AFL - CIO, Local 1815 and Army Aviation Center, Fort Rucker, Alabama, 28 FLRA 1172, 1180-81 (1987), we decided that Provision 9, which required the Agency to select an employee to serve as the union's representative on the Incentive Awards Committee, was within the duty to bargain. We rejected the agency's argument that management's rights to direct employees and assign work under section 7106(a)(2)(A) and (B) of the Statute encompass determinations as to whether the performance of particular employees warrants granting an award. In this case, the Agency established an award program and the amount of the award. The continuation of this program is solely at the discretion of the Agency and, as the Union notes, its proposal does not require that this program be continued indefinitely. Union Response at 1. Moreover, as indicated by the record, the Agency sets the performance standards used to determine eligibility for an award and also evaluates employee performance in light of these standards. Consequently, the proposal constitutes a procedure by which the awards are granted. Based on the foregoing, we conclude that (1) the decision concerning union Proposals 2 and 3 in Library of Congress, relied on by the Agency, is not consistent with present case law and will no longer be followed; (2) the Agency has not established that the Union's proposal involves management's rights to direct employees and assign work; and (3) the proposal is within the duty to bargain. V. Order The Agency must negotiate upon request or as otherwise agreed to by the parties concerning the disputed proposal. 1 Issued, Washington, D.C., January 28, 1988. Jerry L. Calhoun, Chairman Jean McKee, Member FEDERAL LABOR RELATIONS AUTHORITY FOOTNOTES Footnote 1 In deciding that the proposal in dispute is within the duty to bargain, we make no judgment as to its merits.