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The decision of the Authority follows:
33 FLRA No. 84
FEDERAL LABOR RELATIONS AUTHORITY
AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES
DEPARTMENT OF THE AIR FORCE
HILL AIR FORCE BASE
DECISION AND ORDER ON NEGOTIABILITY ISSUE
October 31, 1988
Before Chairman Calhoun and Member McKee.
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 provision of a locally negotiated agreement which was disapproved by the agency head in the course of review under section 7114(c) of the Statute.
The provision concerns the procedures to be followed when the Department of the Air Force, Hill Air Force Base, Ogden, Utah (the Activity) plans to collect debts involving overpayments of pay and allowances allegedly owed by bargaining unit employees to the Department of the Air Force (the Agency). Under the provision, employees would have the option of using the appeal procedures set forth in the Debt Collection Act of 1982, 5 U.S.C. § 5514 (the Act), or the grievance and arbitration procedures under the parties' negotiated grievance procedure. If an employee chose to use the negotiated grievance procedure, collection of a debt allegedly owed to the Agency would be delayed pending the arbitrator's decision.
The Agency contends that the provision is outside the duty to bargain under section 7117(a)(1) of the Statute because it is inconsistent with applicable law and Government-wide regulation. For the reasons stated below, we reject the Agency's contentions and conclude that the provision is within the duty to bargain.
The American Federation of Government Employees, AFL-CIO, Local 1592 (the Union) represents a bargaining unit of employees at the Activity. The Activity and the Union negotiated a provision in a local agreement concerning the payment of employee financial obligations. Under section 7114(a) of the Statute, the agency head reviewed the local agreement and disapproved the provision here in issue on the basis that it was not negotiable.
The Union then filed a petition for review of the negotiability issue and also filed a related unfair labor practice charge. The Union chose to proceed with the unfair labor practice charge first. Therefore, processing of this negotiability appeal was suspended. After being advised that the General Counsel declined to issue an unfair labor practice complaint, the Authority resumed processing of the Union's petition for review.
After the parties filed their submissions in this case, the Authority issued its decision in National Federation of Federal Employees, Local 29 and U.S. Army Corps of Engineers, Kansas City District, Kansas City, Missouri, 32 FLRA 721 (1988) (Kansas City District), petition for review filed sub nom. United States Army Corps of Engineers, Kansas City District v. FLRA, No. 88-2403 (8th Cir. Sept. 19, 1988). In Kansas City District, the Authority addressed in detail the effect of the Debt Collection Act on a collective bargaining proposal relating to the collection of debts owed to the Government by employees of an agency.
On August 31, 1988, we directed the parties to file supplemental briefs addressing the application of Kansas City District to the resolution of the negotiability appeal before us. Both parties filed briefs. Additionally, on September 29, 1988, we granted the request of the Office of Personnel Management (OPM) to submit written arguments as an amicus curiae in this case. OPM submitted its brief on October 12, 1988.
Article 13(s). Employee Financial Obligations
Whenever management plans to collect any debt involving overpayment of pay and allowances allegedly owed by an employee to the government, the procedures outlined in 5 USC 5514(a)(2) will be followed. Should an employee choose to follow the appeal procedures outlined in 5 USC 5514, the collection will be processed in accordance with the procedures outlined in 5 USC 5514. Should the matter be grieved under the negotiated grievance procedure the collection will be delayed pending the decision of the arbitrator or withdrawal of the grievance prior to arbitration. If the grievance does not proceed to arbitration, then the collection is no longer stayed.
[Only the underlined portion is in dispute.]
IV. Positions of the Parties
A. Agency's Contentions
The Agency contends that the disputed portion of the provision impermissibly gives employees the option to use the negotiated grievance procedure to resolve disputes under the Debt Collection Act. According to the Agency, the provision is inconsistent with: (1) the Act; (2) section 7121 of the Statute; and (3) 5 C.F.R. § 550.1104.
The Agency states that section 5514(a)(2)(D) of the Act grants employees the right to a hearing by a neutral third party. According to the Agency, the use of the negotiated grievance procedure to resolve disputes under the Act conflicts with that section because, under section 7121(b)(3)(C) of the Statute, only a union or an agency--not an employee--has the right to invoke arbitration. The Agency also argues that the use of the negotiated grievance procedure in debt collection proceedings conflicts with the requirement in the Act that the hearing officer's decision be "final." The Agency contends that an arbitration award is not "final" because it is subject to review by the Authority. The Agency asserts that in enacting the Debt Collection Act, Congress intended to establish an exclusive procedure for the collection of employee debts owed to the Federal Government. According to the Agency, allowing questions about employees' debts to be submitted to arbitration would lead to an unreasonable delay in debt collection, contrary to Congressional intent.
The Agency also asserts that 5 C.F.R. § 550.1104 requires an agency to uniformly and consistently apply internal debt collection procedures to all of its employees. The Agency contends that it "would be prevented from complying with [that] Government-wide regulation" if this provision is implemented because non-unit employees of the Activity would be required to use a different procedure from the one established in the agreement for unit employees. See Agency's Statement at 9. The Agency also argues that the provision is inconsistent with the requirement of 5 U.S.C. § 5514(b)(1) "that regulations prescribed by the Secretaries of the military departments to carry out subsection (a)(3) of the Act shall be uniform insofar as practical." Id. at 10.
In its supplemental brief, the Agency states that "[t]he difference between Kansas City District and the instant proposal is the provision of an option between the negotiated grievance procedure and the procedures required by 5 U.S.C. § 5514." Agency's Supplemental Brief at 1. The Agency contends that although the Act provides employees with an opportunity to challenge the validity of a debt in a hearing with full due process rights, it does not provide for an alternative procedure like the negotiated grievance procedure.
B. Union's Contentions
The Union states that the provision requires "the Agency to stay collection of overpayment of pay and/or allowances to employees until the conclusion of the grievance procedure if an employee should elect to challenge those overpayments through the grievance procedure instead of utilizing the Agency's internal procedure developed pursuant to 5 USC 5514." Union's Response to Agency's Statement of Position at 1. The Union notes that "[t]he Agency does not challenge the negotiability of the stay concept" of the provision. Id. The Union argues that the Act's appeals procedure does not preclude coverage of the subject matter under a negotiated grievance procedure. The Union also argues that: (1) the provision does not require employees to use the negotiated grievance procedure because they can still elect to use the Agency's internal appeals procedure; and (2) the fact that an arbitrator's award is subject to Authority review does not render the award less than "final."
In its supplemental statement, the Union states its agreement with the Authority's decision in Kansas City District. The Union also notes that both parties to this case understand that the provision at issue refers "exclusively to debts owed by employees to the Air Force." Union's Supplemental Statement at 2.
C. Amicus Curiae
The Office of Personnel Management contends that by giving employees an option to use the statutory negotiated grievance procedure, the provision "affords a remedy outside the exclusive remedy set forth in the Debt Collection Act and trenches upon the finality of the independent hearing examiner's determination." OPM's Brief at 2. OPM argues that the requirement of finality "is a crucial element of the definition of a 'hearing' within the meaning of the [Act] and cannot be reconciled with the procedures laid out in [section 7121 of the Statute]." Id. at 3.
OPM contends that the Authority erred in Kansas City District because that decision "does not provide for or permit the finality required by the [Act] and does not provide for a 'hearing' within the meaning of the Act." OPM's Brief at 6. OPM maintains that an essential feature of the negotiated grievance procedure is a party's right to appeal an arbitrator's award. It asserts that the right of appeal is inconsistent with the requirement of the Act that "the decision of the independent hearing examiner be 'final' and not subject to challenge in any forum." Id. at 4.
OPM also contends that the provision violates section 7117 of the Statute because it is contrary to OPM's regulations implementing the Act, which are Government-wide regulations. OPM argues that the provision and the Authority's decision in Kansas City District are inconsistent with the regulations, which provide that debt collection regulations must be uniformly and consistently applied to all employees of an agency regardless of their bargaining unit status.
We find that the provision is not inconsistent with applicable law and regulation and is, therefore, within the duty to bargain.
The Authority has discussed the effect of the procedures set forth in the Debt Collection Act on the scope and coverage of negotiated grievance procedures in two earlier cases. Since the arguments in this case are similar to those previously addressed by the Authority, a review of those cases is pertinent here.
A. Department of Defense Dependents Schools and Overseas Education Association
In Department of Defense Dependents Schools and Overseas Education Association, 22 FLRA 142 (1986) (OEA), an agency filed an exception to an arbitration award in which an arbitrator resolved a grievance concerning a debt allegedly owed by an employee to the agency. The agency argued that permitting resolution of the question of the indebtedness through the grievance and arbitration process was inconsistent with the Debt Collection Act and the requirement of 5 C.F.R. § 550.1104 that debt collection regulations be uniformly and consistently applied to all employees of an agency.
The Authority found that the Debt Collection Act does not preclude an arbitrator "from ruling on and overturning an assessment of administratively determined indebtedness against an employee." 22 FLRA at 144. After analyzing relevant statutory provisions and judicial and Authority precedent, the Authority determined that "none of the [a]gency's arguments provide a basis for concluding that the grievance in this case protesting the [a]ctivity's determination of indebtedness is excluded by law from the coverage of the negotiated grievance procedure." Id. at 146.
The Authority also rejected the agency's arguments that the award was contrary to 5 C.F.R. § 550.1104. The Authority stated:
The Agency has argued in its exception that permitting the use of the negotiated grievance procedure in these matters, which is available only to bargaining-unit employees under a collective bargaining agreement, necessarily precludes uniformity and consistency of application of agency regulations to all employees as required by 5 CFR § 550.1104. However, the means of dispute resolution that may be available to individual employees has not been shown to preclude the uniform and consistent application to all employees of the substantive terms of agency regulations governing the collection of debts. Furthermore, the [a]gency's argument that there cannot be uniformity and consistency because grievance and arbitration is not available to nonbargaining-unit employees is without merit and provides no basis for finding the award deficient. Such an effect is precisely the result contemplated by the terms and provisions of the Statute.
22 FLRA at 146.
Accordingly, the Authority denied the exception to the award.
B. National Federation of Federal Employees, Local 29 and U.S. Army Corps of Engineers, Kansas City District, Kansas City, Missouri
In Kansas City District, we noted that the Act "entitles an individual from whom an agency proposes to collect a debt to certain procedures, including written notice of the nature and amount of the indebtedness, an opportunity to inspect records, and an opportunity for a hearing and decision on the agency's determination on the existence and amount of the debt." 32 FLRA at 725. The proposal in that case established the procedures available to unit employees who are initially determined to be indebted.
We found negotiable those portions of the union's proposal which: (1) preserved the scope of the parties' existing negotiated grievance procedure for employees who are initially determined to be indebted to the agency; and (2) provided employees with an explanation of their rights under the grievance procedure. 32 FLRA at 726-28 (1988). We rejected the agency's arguments, similar to those made by the Agency and OPM in the case before us, that the disputed sections of the proposal were inconsistent with the Act, section 7121 of the Statute, and 5 C.F.R. § 550.1104. We stated that:
The purpose of the procedures in the Debt Collection Act is to validate the existence and amount of indebtedness proposed to be collected by salary offset. See 5 U.S.C. § 5514(a)(2)(D). That process culminates in a review of the initial determination of indebtedness by a hearing officer, who issues a "final decision." 5 U.S.C. § 5514(a)(2). The "final decision" determines that a debt is owed in a specified amount and authorizes the commencement of collection proceedings. 5 U.S.C. § 5514(a)(2).
Until the proceedings required by section 5514(a)(2) have resulted in a final decision on the alleged debt or until the proceedings have been waived by the employee, the employee has no "complaint" concerning the employee's employment. Consequently, until the proceedings required by section 5514 are completed or waived, there is no grievance under section 7103(a)(9) of the Statute.
If the proposed procedures resulted in a finding that a unit employee was indebted and led to authorization of collection proceedings, a complaint by the employee about the indebtedness would constitute a "grievance." The grievance would be covered by the negotiated grievance procedure, unless excluded by the parties. Nothing in the Act, including the provision for a final decision by a hearing officer, precludes a grievance over a determination of indebtedness or limits the authority of an arbitrator to review such a determination.
32 FLRA at 727-28 (case citations omitted).
We also rejected the agency's contention that the proposal was inconsistent with the requirement of 5 U.S.C. § 5514(b)(1) that regulations prescribed by the Secretaries of the military departments be uniform insofar as practicable. We concluded the "section 5514(b)(1) does not require the [a]gency to establish uniform procedures applicable to civil service employees and members of the Armed Forces." Id. at 730. We stated that:
[S]ection 5514(b)(1) requires uniformity only "insofar as practicable." The Act and its legislative history are silent as to the meaning of that phrase. At a minimum, however, the phrase "insofar as practicable" indicates Congressional intent that absolute uniformity is not required. If Congress had intended to mandate uniformity, it would not have expressly authorized agencies to exercise their discretion with regard to considerations of practicability. Consequently, in the absence of any expression of
Congressional intent to the contrary, we find that the phrase, "insofar as practicable," provides agencies with sufficient flexibility to carry out their duties to bargain under the Statute.
32 FLRA at 730.
C. The Provision in this Case is Within the Duty to Bargain
The Union states that the provision in this case refers exclusively to debts owed by bargaining unit employees to the Agency by which they are employed, and not to debts owed to any other agency. See Union's Supplemental Statement at 1-2. The Agency does not dispute the Union's interpretation of the proposal. Therefore, we interpret this provision as applying only to debts owed to the Agency by the bargaining unit employees in this case. Compare Kansas City District, 32 FLRA at 724-25 (concerning the negotiability of proposals pertaining to debts owed by bargaining unit employees to agencies other than the employing agency). For the reasons stated below, we conclude that the disputed portion of the Union's provision is not inconsistent with applicable law and regulation.
The provision establishes the negotiated grievance procedure as an alternative to the hearing procedure required by the Debt Collection Act. The practical effect of the provision is to allow an employee either to: (1) appeal the Activity's initial determination of indebtedness before an impartial hearing officer in accordance with 5 U.S.C. § 5514(a)(2)(D); or (2) forego the opportunity of a hearing under section 5514(a)(2)(D) and file a grievance challenging the Activity's determination of indebtedness and the terms of the repayment schedule. The second option--to invoke the grievance procedure--operates as a waiver of the employee's right to a hearing under section 5514(a)(2)(D). Once an employee has waived the right to a hearing, either by failing to request a hearing within the time required by the Act or by electing to file a grievance under the negotiated grievance procedure, the initial determination concerning the existence and amount of the indebtedness becomes a final agency determination.
As we held in Kansas City District, the Act does not preclude access to the grievance procedure to contest a final determination that the employee is indebted to the agency. In the absence of any clear, specific indication that Congress intended the procedures in the Debt Collection Act to be the exclusive procedures for resolving disputes concerning a final determination of indebtedness, we reaffirm our conclusion in Kansas City District that a complaint by an employee concerning a final determination of indebtedness constitutes a "grievance" within the meaning of section 7103(a)(9) of the Statute. The grievance would be covered by the negotiated grievance, unless excluded by the parties. Id., at 728. See also National Treasury Employees Union, Chapter 15 and Internal Revenue Service (Los Angeles District), 33 FLRA No. 26 (1988) (the statutory procedures for resolving questions of responsibility of accountable officers for loss of public funds did not constitute the exclusive administrative relief in accountable officer cases; such cases may be submitted to a negotiated grievance procedure).
We also find, for the reasons stated in OEA and Kansas City District, that the provision in this case does not violate the requirement in 5 C.F.R. § 550.1104 that regulations governing the collection of internal debts be uniformly and consistently applied to all employees. See also 48 Fed. Reg. 43687 (Sept. 26, 1983) (5 C.F.R. Part 550 "is intended to provide a minimum level of uniformity on basic procedures."). Additionally, section 5514(a)(3) provides that the collection procedures of the Act shall be in accordance with the Federal Claims Collection Standards, (promulgated under 31 U.S.C. §§ 3711 and 3716-18 [section 10 of the Debt Collection Act of 1982]). In implementing the Standards, the Department of Justice and the General Accounting Office stated that:
Each Federal agency is required to develop its own implementing regulations, based on and consistent with these Standards, and it is there that we believe the detailed procedures belong. While uniformity of policy is desirable throughout the Federal Government, we have never been convinced that uniformity of operating procedures is either necessary or beneficial.
49 Fed. Reg. 8889 (Mar. 9, 1984) (emphasis in original). As we found in Kansas City District, 5 U.S.C. § 5514(b)(1) does not require absolute uniformity in the application of regulations promulgated under the Act and provides agencies with sufficient discretion to carry out their duty to bargain under the Statute. 32 FLRA at 731-32.
In their briefs addressing the applicability of Kansas City District to the provision in this case, neither the Agency nor OPM has presented arguments warranting a departure from our rulings in that case. The arguments are similar to those which the Authority addressed previously. Therefore, consistent with Kansas City District and OEA, we conclude that the disputed portion of the provision in this case does not violate applicable law or regulation. Accordingly, the provision is within the duty to bargain.
The Agency must rescind its disapproval of the provision.(*)
(If blank, the decision does not have footnotes.)
*/ In finding this provision negotiable, we make no judgment as to its merits.