[ v31 p1203 ]
The decision of the Authority follows:
31 FLRA NO. 107 NATIONAL FEDERATION OF FEDERAL EMPLOYEES, Local 1256 Union and DEPARTMENT OF THE AIR FORCE K.I. SAWYER AIR FORCE BASE MICHIGAN Agency Case No. 0-NG-1469 DECISION AND ORDER ON NEGOTIABILITY ISSUES I. Statement of the Case This case is before the Authority because of a negotiability petition filed by the Union under section 7105(a)(2)(E) of the Federal Service Labor - Management Relations Statute (the Statute). The case concerns the negotiability of a union proposal relating to employees' eligibility to be considered for quality step increases (QSIs) --awards of pay step increases--which agencies may grant employees under 5 U.S.C. 5336 in recognition of "high quality performance." As explained below, we find that the petition was not filed untimely as contended by the Agency. We also find that the proposal concerns a condition of employment, is consistent with management's rights, and is negotiable. II. Background Prior to June 1987, Department of the Air Force regulations permitted managers to grant QSIs to employees at all steps within the grades of the General Schedule, at 52-week intervals. In June 1987, the Department modified its regulations (AFR 40-452, para. 7-5) to restrict eligibility for QSIs to employees at steps 4 and above and to increase the required intervals for QSIs to 3 years. The local parties jointly requested a partial exception to the new restriction from the Department of the Air Force. They asked to be allowed to consider QSIs for employees at step 3 and above. The request for an exception was denied by letter dated August 17, 1987. The parties subsequently renewed their negotiations. The Union then proposed that there be no change in the prior policy for quality step increases and, on September 24, 1987, requested an allegation as to the negotiability of its proposal. The Agency alleged that this Union proposal is nonnegotiable on September 30, 1987. III. The Timeliness Issue The Agency contends that the denial of the local parties' request for an exception from the Air Force Regulation in August 1987, constituted an Agency allegation that a substantively identical provision was nonnegotiable. Therefore, it claims that the petition for review filed on October 15, 1987, was untimely. This contention cannot be sustained. The record shows that when the local parties requested the Agency to grant an exception to the modified Departmental regulation, the Union did not request an allegation of nonnegotiability. Union Response at 1; Agency Statement of Position, Attachment 3. The Agency's response in August 1987, was captioned "Request for Exception" and stated that the "request for a waiver is denied." Agency Statement of Position, Attachment 5. The response also directed local management to "restrict its discussions to the impact of the Air Force policy" and stated that the issue was "not subject to negotiation." Since the record does not show that the Union had requested an agency allegation within the meaning of section 2424.3 of the Authority's Regulations, the Union was not obligated to file a petition within 15 days of the Agency's August response in order to preserve its right to appeal. The petition is timely in relation to the requested allegation of nonnegotiability, which was served on the Union on October 1, 1987. IV. The Proposal The Union proposes that unit employees at steps 1 and above may be considered for QSIs and that the minimum interval for QSI consideration should be 52 weeks. A. Positions of the Parties The Agency contends that under 5 U.S.C. 5536, a QSI is defined as a part of basic pay, which is a matter specifically provided by Federal statute. Therefore, it claims that the proposal concerns a matter which is excluded from the definition of conditions of employment under section 7103(a)(14)(C) of the Statute. The Agency also contends that the proposal is nonnegotiable because it conflicts with management's rights to direct employees and assign work under section 7106(a)(2)(A) and (B). The Union disputes the Agency's contentions and asserts that the proposal is negotiable because it "merely requires the agency to continue to give employees at steps 1 through 3 the same consideration for QSIs as employees at steps 4 and above receive." Petition for Review at 4. B. Analysis 1. The Proposal Is Not Outside the Duty to Bargain Because It Concerns a Matter Provided for by Statute Under 5 U.S.C. 5336, an agency may grant a QSI to an employee "in recognition of high quality performance above that found in the type of position concerned." Under the Office of Personnel Management's implementing regulations, "(t)he purpose of quality step increases is to recognize outstanding performance." 5 C.F.R. 531.503. In our view, these provisions show that although QSIs are provided for in the "basic pay" provisions of 5 U.S.C. 5331-5338, in substance QSIs are intended to be forms of incentive pay, rather than pay for the performance of the essential duties of a position. Accordingly, we find that QSIs, which provide incentive pay for employees for superior performance, are substantively equivalent to incentive awards. Therefore, we conclude that the Union's proposal concerning QSIs is not excluded from bargaining under section 7103(a)(14)(C), as contended by the Agency, simply because QSIs are covered by the provisions of 5 U.S.C. 5331-5338. The proposal does not conflict with matters specifically provided for by statute in other respects. The proposal is wholly procedural in nature, in that it is only concerned with the pool of employees who may be considered for QSIs and the frequency at which QSIs may be granted. It is not concerned with and does not set the amount of a QSI. Instead, it contemplates that the step increases which are awarded to employees-as QSIs will be the step increases which are set by law. Insofar as the proposal provides that QSIs may be granted at 52-week intervals, the proposal tracks the interval requirement in the applicable statute. 5 U.S.C. 5336. Finally, the proposal does not establish the performance criteria for granting a QSI, and it does not mandate that a QSI be granted to any employee. Compare National Treasury Employees Union, Chapter 245 and Department of Commerce, Patent and Trademark Office, 30 FLRA 1219, 1226 (1988) (a proposal which would mandate a QSI award conflicts with Government-wide regulation--5 C.F.R. 531.504). 2. The Proposal Does Not Interfere with Management's Rights to Direct and Assign Work The Agency argues that this proposal is nonnegotiable under the rationale used by the Authority 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) (Library of Congress) and National Treasury Employees Union and Internal Revenue Service, 14 FLRA 463 (1984) (IRS I). These decisions have been overruled. In NTEU v. FLRA, 793 F.2d 371, 375 (D.C. Cir. 1986), the court reversed the Authority's conclusion in IRS I that a union proposal concerning incentive awards conflicted with management's rights to direct employees and assign work. The court held that management decisions relating to rewarding superior performance did not affect the rights to direct and assign work under section 7106(a)(2)(A) and (B). In National Treasury Employees Union and Internal Revenue Service, 27 FLRA 132, 135 (1987) (IRS II), we adopted the court's holding regarding the rights to direct and assign work and held that a union proposal concerning incentive awards did not affect these rights. In later decisions--for example, National Treasury Employees Union and Internal Revenue Service, Indianapolis District, 30 FLRA 1170 (1988), in which we overruled the Authority's prior decision in Library of Congress--we continued this approach, concluding that other union proposals concerning incentive awards did not affect the right to direct employees or the right to assign work. See also American Federation of Government Employees, AFL - CIO, Local 1815 and Army Aviation Center, Fort Rucker, Alabama, 28 FLRA 1172, 1180-81 (1987). As explained in connection with the Agency's contentions under section 7103(a)(14)(C), we conclude that QSIs are equivalent to incentive awards. Based on the above-cited decisions, which overruled the reasoning and conclusions in IRS I and Library of Congress, we further conclude that the Union's proposal, which concerns employee eligibility for QSIs, does not conflict with management's rights to direct employees or assign work under section 7106(a)(2)(A) and (B). C. Conclusion The proposal is negotiable. The Agency has not established either that the proposal (1) encompasses matters established by law so as to be outside the duty to bargain under section 7103(a)(14)(C), or (2) interferes with the exercise of management's rights under section 7106(a)(2)(A) and (B) to direct employees and assign work to employees. It is not apparent that the proposal is outside the duty to bargain on other grounds. V. Order The Agency must negotiate upon request, or as otherwise agreed to by the parties, concerning the proposal. */ Issued, Washington, D.C., April 22, 1988. Jerry L. Calhoun, Chairman Jean McKee, Member FEDERAL LABOR RELATIONS AUTHORITY FOOTNOTES Footnote */ In finding this proposal to be within the duty to bargain, the Authority makes no judgment as to its merits.