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The decision of the Authority follows:
41 FLRA No. 104
Before Chairman McKee and Members Talkin and Armendariz.
I. Statement of the Case
This case is before the Authority on a negotiability appeal filed under section 7105(a)(2)(E) of the Federal Service Labor-Management Relations Statute (the Statute). It involves three provisions that were disapproved by the Agency head pursuant to section 7114(c) of the Statute.(1)
For the reasons that follow we conclude that Provision 1, which would prohibit the use of certain information about bargaining unit employees unless specified conditions are met, is nonnegotiable because it excessively interferes with management's right to take disciplinary action. Provision 2, which concerns the point at which declarations of nongrievability and nonarbitrability must be made in the context of the parties' grievance and arbitration procedures, does not conflict with sections 7106 and 7121(c), (d) and (e) of the Statute, as claimed by the Agency, and is negotiable. Provision 3, which concerns the granting of incentive awards based on performance ratings, is inconsistent with a Government-wide regulation and is nonnegotiable.
II. Provision 1
Article 7 Section 4A- When someone from outside the TMEO(2) communicates with the Office about a Unit employee, no part of the communication will be used against the employee unless:
1. it is reduced to writing, which includes a notation of the dates;
2. the employee is given a copy of the complaint and is given the opportunity to make a written response to the complaint, which shall be attached to the complaint wherever it is filed; and
3. the employee gets copies of other investigatory reports management develops from the communication which are used in an action against an employee.
A. Positions of the Parties
The Agency asserts that this provision is not limited to providing employees with access to information, but prohibits the Agency from using the information against an employee unless the conditions specified in the provision are met. The Agency argues that because the provision effectively could immunize an employee from discipline it is inconsistent with management's right to take disciplinary actions under section 7106(a)(2) of the Statute.
Citing the Authority's decision in American Federation of Government Employees, AFL-CIO, Local 1458 and U.S. Department of Justice, Office of the U.S. Attorney, Southern District of Florida, 29 FLRA 3 (1987) (Provision 7) (Department of Justice), the Agency asserts that this provision is nonnegotiable for the additional reason that it is contrary to Government-wide rule and regulation. Specifically, it contends that 5 C.F.R. §§ 297.205 and 752.404(b)(1) provide agencies with the right to withhold certain medical information from an employee.
Additionally, the Agency claims that this provision interferes with management's right to determine its internal security practices under section 7106(a)(1) of the Statute. More specifically, the Agency contends that there are circumstances under which the requirement to release information to an employee before actions involving the employee, such as reassignment, detail, surveillance, or relocation, can be effected could compromise the Agency's internal security. The Agency asserts, in this regard, that a "'communication' received from outside TMEO" could encompass information from the "Department's Security Officer, or the PTO Personnel Officer, outlining a security breach and directing corrective action[.]" Agency-head disapproval at 2.
The Union describes this provision as intended to provide procedural safeguards for employees who are subjected to complaints from outside the Agency. The Union states that the primary effect of the provision is to provide employees access to information that may cause them harm and give them an opportunity to rebut and monitor the use of the information.
In rebutting the Agency's assertion that this provision would, under some circumstances, immunize employees from disciplinary action, the Union contends that this provision must be read in conjunction with Article 3, section 1, of the parties' agreement. Article 3, section 1, essentially provides that the agreement is governed by, among other things, laws and Government-wide regulations. The Union contends that when read in conjunction with Article 3, section 1, this provision would not require the release of information that is prohibited by law or an applicable Government-wide regulation. Consequently, the Union claims that this provision would not prevent the Agency from either withholding information when required by law or Government-wide regulation or initiating discipline when information has been withheld for legitimate reasons.
In response to the Agency's assertion that the provision interferes with its management right to determine its internal security practices, the Union contends that the proposal is intended to apply to "communications from members of the public" and not to internal agency information. Union reply brief at 3. Based on this meaning, the Union contends that subsections 1 and 2 of the provision do not require that internal agency information be divulged. The Union acknowledges that subsection 3 would require the disclosure of investigatory reports developed from such communications. However, relying on a decision by an Authority Administrative Law Judge,(3) the Union contends that such disclosure is required under section 7114(b) of the Statute. The Union asserts that the Agency has not demonstrated that this provision would jeopardize its internal security. According to the Union, the provision would not require the release of information in violation of the Privacy Act and would permit information to be provided in sanitized form.
B. Analysis and Conclusions
We first address the Union's statements concerning the intent of the proposal. The Union's claim that subsections 1 and 2 are limited to communications received from the public and do not encompass internal agency communications does not correspond with the provision as written. That is, the provision as written applies to communications from "someone outside the TMEO." As we noted earlier, the only definition of "TMEO" that is contained in the record is Trademark Examining Operation. Based on this definition, we must conclude that under the provision as written, subsections 1 and 2 are not limited to communication from the public and would include internal Agency communications emanating from those parts of the Agency that are outside the TMEO. See, for example, American Federation of Government Employees, AFL-CIO, Council of Marine Corps Locals, Council 240 and U.S. Department of the Navy, Headquarters, U.S. Marine Corps, Washington, D.C., 39 FLRA 839, 846 (1991) (Where a union's construction is inconsistent with the plain wording of a proposal or provision, we will base our decision on the interpretation of the proposal or provision that is consistent with the plain wording.).
We do not agree with the Union that reading the provision in conjunction with Article 3, section 1, negates the Agency's contention that the provision interferes with its management right to take disciplinary action. Construing the provision in conjunction with Article 3, section 1, would operate to overcome any requirement to provide information where such is prohibited by law or Government-wide regulation. Thus, the Agency's contentions cannot be sustained insofar as they are based on an interpretation of the provision that requires information to be divulged where disclosure is inconsistent with a Government-wide regulation. However, the provision is not limited to requiring that information be provided to employees; it also prohibits the use of information that is not provided. As we are unaware of any law or Government-wide regulation that would require agencies to use specific information, and the Union cites none, simply giving controlling force to law and Government-wide regulation would not overcome the provision's prohibition on the Agency's use of information. As we will explain further, because the provision would prohibit the Agency's use of information, it interferes with management's right to take disciplinary action.
The Authority has previously held that management's right to take disciplinary actions under section 7106(a)(2)(A) encompasses the right to obtain and use evidence to support actions. For example, National Association of Government Employees and U.S. Department of Veterans Affairs, Medical Center, Brockton and West Roxbury, Massachusetts, 41 FLRA 529, 533 (1991) (VAMC, Brockton). In addressing proposals that would restrict an agency's use of various materials and documentation as evidence, we have concluded that those proposals directly interfere with management's rights to discipline employees under section 7106(a)(2)(A) of the Statute.
As written, this provision does not allow the Agency to use information against an employee unless, among other things, a copy has been given to the employee. The Agency asserts that this provision would apply to the use of adverse medical information in the context of disciplinary actions. In addressing the Agency's argument, the Union does not dispute this assertion. Under Office of Personnel Management (OPM) regulations, certain medical or psychological records may be given only to a physician who has been designated by the subject of the records, and who in turn has "full authority to disclose those records to the [employee] when appropriate." 5 C.F.R. § 297.205. This regulatory requirement can be a factor in adverse action proceedings. Department of Justice, 29 FLRA at 15. More specifically, OPM regulations that govern adverse actions, such as removals, suspensions for more than 14 days, and reductions in grade or pay, prohibit agencies from using "material that cannot be disclosed to the employee of [sic] his or her representative or designated physician under § 297.204(c)(4) of this chapter to support the reasons" in a notice of proposed action. 5 C.F.R. § 752.404(b). Thus, 5 C.F.R. § 752.404(b) also contemplates that an agency may be required to disclose certain information to a designated physician in lieu of the employee.
Under Provision 1 as written, the Agency could be prohibited from using medical or psychological records that under 5 C.F.R. § 297.205 it may provide only to a physician to support a disciplinary action. Consequently, this provision directly interferes with management's right to take disciplinary action by restricting the Agency's use of materials and documentation to support disciplinary and adverse actions. See, for example, VAMC, Brockton, 41 FLRA 529. Compare Overseas Education Association, Inc. v. FLRA, 827 F.2d 814, 818 (D.C. Cir. 1987) (an agency is not obligated to bargain over a proposal that includes, along with matters that are negotiable, matters that the agency cannot lawfully agree to), affirming Overseas Education Association, Inc. and Department of Defense, Office of Dependents Schools, 22 FLRA 351 (1986).
A provision that directly interferes with management's rights is nonnegotiable unless it constitutes an appropriate arrangement under section 7106(b)(3) of the Statute. Here, the Union describes the provision as providing a procedural safeguard for employees because it is intended to allow employees to defend themselves against allegations that may result in negative consequences. We view these arguments as an assertion that the provision constitutes an appropriate arrangement. In previous cases, the Authority has concluded that although proposals and provisions that would limit an agency's use of materials in supporting disciplinary and adverse actions may constitute arrangements, they are not appropriate because they excessively interfere with management's rights to discipline employees. See American Federation of Government Employees, AFL-CIO, Local 3732 and U.S. Department of Transportation, United States Merchant Marine Academy, Kings Point, New York, 39 FLRA 187, 223-24 (1991); Portsmouth Federal Employees Metal Trades Council and Portsmouth Naval Shipyard, 34 FLRA 1150, 1156-57 (1990); American Federation of Government Employees, AFL-CIO, Local 1931 and Department of the Navy, Naval Weapons Station, Concord, California, 32 FLRA 1023, 1047-50 (1988), rev'd as to other matters sub nom. Department of the Navy, Naval Weapons Station, Concord, California v. FLRA, No. 88-7408 (9th Cir. Feb. 7, 1989).
Here, the Union offers nothing to support a conclusion that a disposition different from that reached in the cases just cited is warranted. It is well established that parties bear the burden of creating a record upon which the Authority can make a negotiability determination. For example, National Federation of Federal Employees, Local 2050 and U.S. Environmental Protection Agency, 35 FLRA 706, 711-12 (1990); National Federation of Federal Employees, Local 1167 v. FLRA, 681 F.2d 886 (D.C. Cir. 1982), aff'g National Federation of Federal Employees, Local 1167 and Department of the Air Force, Headquarters, 31st Combat Support Group (TAC), Homestead Air Force Base, Florida, 6 FLRA 574 (1981). A party failing to meet this burden acts at its peril. For example, National Association of Government Employees, Local R1-134 and U.S. Department of the Navy, Naval Underwater Systems Center, Newport, Rhode Island, 38 FLRA 589, 596 (1990). Accordingly, based on the record in this case, we conclude that this provision does not constitute an appropriate arrangement under section 7106(b)(3) of the Statute and that it is nonnegotiable.
In view of our conclusion that this provision excessively interferes with management's right to discipline employees, it is unnecessary to address the Agency's contention that this provision also interferes with management's right to determine its internal security practices.
III. Provision 2
Article 11 Section 7- In the event either party should declare a grievance non-grievable or non-arbitrable, the original grievance shall be considered amended to include this issue. The earlier this declaration is made, the better. However, in no event can such a declaration be made after the issuance of a second step answer. All disputes of grievability or arbitrability shall be referred to arbitration as a threshold issue in connection with the related grievance. [Only the underlined portion is in dispute.]
A. Positions of the Parties
The Agency contends that the disputed portion of this provision is inconsistent with sections 7106 and 7121(c), (d) and (e) of the Statute and is nonnegotiable. More specifically, the Agency maintains that if, as a matter of law, a matter is barred from grievance and arbitration procedures, jurisdictional issues are raised that cannot be waived. The Agency argues that this provision would produce the anomalous and wasteful result of precluding the Agency from presenting its claims concerning jurisdiction to an arbitrator while permitting a post-decisional attack on the arbitrator's jurisdiction under section 7121(f) or section 7122 of the Statute.
The Union describes this provision as intended to mandate the exploration of threshold issues of grievability and arbitrability early in the grievance process so that one party may not surprise the other at arbitration with a nonarbitrability claim. According to the Union, this provision simply complies with the requirement of section 7121(a)(1) of the Statute that collective bargaining agreements provide procedures for the settlement of questions of arbitrability by providing that such questions be raised no later than issuance of the second (final) step grievance answer. The Union argues that this provision encourages the resolution of differences of opinion early in the grievance process and prevents delays in arbitration proceedings. The Union maintains that under this provision the Agency retains the ability to raise objections to the arbitrability of a grievance any time until the matter is ready for arbitration as well as subsequently in seeking review of arbitration awards under section 7121(f) or section 7122 of the Statute.
B. Analysis and Conclusions
In our view, the disputed portion of this provision does not preclude the Agency from asserting that a matter is not grievable or arbitrable based on sections 7106 and 7121(c), (d), and (e) of the Statute. Under this provision both parties agree that the Agency retains the ability to raise questions of nonarbitrability and nongrievability for the first time at any stage of the negotiated grievance procedure as well as after the issuance of an arbitration award. The provision limits only the Agency's ability to raise such questions for the first time before an arbitrator. Thus, the provision does not foreclose resolution of grievability/arbitrability questions in the context of the negotiated grievance and arbitration procedures.
Because this provision does not preclude the parties from raising questions of grievability and arbitrability and because the parties retain the right to raise those issues before the Authority on exceptions to an award, we reject the Agency's contention that the provision is inconsistent with the Statute. In particular, we note that nothing in sections 7106 and 7121(c), (d) and (e), on which the Agency relies, addresses the resolution of questions of grievability and arbitrability or the point in grievance and arbitration procedures where such questions may be raised. Rather, the relevant portion of the Statute is section 7121(a), which states that "any collective bargaining agreement shall provide procedures for the settlement of grievances, including questions of arbitrability." In our view, Provision 2 is consistent with section 7121(a). See also Interpretation and Guidance, 2 FLRA 274, 278-79 n.7 (1979) ("Unless the parties, consistent with law, mutually agree otherwise, such procedures must be read as providing that all questions of arbitrability not otherwise resolved shall be submitted to arbitration." Emphasis supplied). Based on the foregoing, we conclude that the disputed portion of Provision 2 is negotiable.
IV. Provision 3
Article 31 Section 3A- For Trademark Examining Attorneys receiving a rating of "5" in the Critical Element of Production and at least a rating of "3" in every other Critical Element, the following awards scale based on Quantity of production shall be used to determine the amount of an individual's award:
Percentage of Quantity Percentage of Salary
of Production Given as Award
141% + 6%
B. Any Trademark Examining Attorney who receives a rating of "4" in the Critical Element of Production and at least a rating of "3" in every other Critical Element shall receive an award of 1% of salary if he/she attains a 105%-109% quantity of production.
C. Any Trademark Examining attorney who receives an average of "5" on the three Critical Elements of Quality and at least a rating of "3" on every other Critical Element may receive an award of 3% of salary.
A. Positions of the Parties
The Agency contends that this provision is nonnegotiable because it is inconsistent with law and Government-wide regulations. Specifically, the Agency contends that this provision "creates an inseparable link between ratings and awards and causes consideration of a nonmerit factor (the award) when assigning a performance rating[.]" Agency-head disapproval at 4. Relying on Department of the Air Force, Langley Air Force Base v. FLRA, 878 F.2d 1430 (4th Cir. 1989) (per curiam) (unpublished order) (Langley Air Force Base),(6) the Agency argues that such an effect renders the provision inconsistent with 5 U.S.C. § 4302 and 5 C.F.R. §§ 430.203, 403.204 and 430.206(b). Although the Agency acknowledges that Langley Air Force Base is an unpublished order, it asserts that it should be given precedential effect in this case. The Agency also contends that this provision is inconsistent with the requirement in 5 U.S.C. § 430.503(c) for review of awards by agency officials.
The Union describes this provision as setting forth the method of calculating an employee's performance award. The Union contends that the contract article in which this provision is included specifically subjects the awards program to budgetary limitations(7)/ and makes allowances for a shortage of funds.(8)
The Union argues that the court's decision in Langley Air Force Base has no precedential value and need not be followed by the Authority and that the Authority has repeatedly held that mandatory awards programs are negotiable. The Union contends that this provision does not prohibit the review that is contemplated by 5 C.F.R. § 430.503(c) and does not interfere with management's right to determine its budget. The Union denies the Agency's claim that the provision would cause rating officials to consider a nonmerit factor in determining ratings. In this regard, the Union asserts that the provision is intended to operate in accordance with law and that under 5 U.S.C. § 2301 rating officials are obligated to consider only merit factors in assigning ratings.
B. Analysis and Conclusions
This provision has essentially the same effect as the provision that the Authority found was nonnegotiable in National Treasury Employees Union and U.S. Department of Commerce, Patent and Trademark Office, Arlington, Virginia, 40 FLRA 3 (1991) (PTO), petition for review filed sub nom. National Treasury Employees Union v. FLRA, No. 91-1262 (D.C. Cir. May 30, 1991). Among other things, this provision, like the provision in PTO, mandates that monetary awards be given based on performance ratings.(9) Although the Union states that the agreement negotiated by the parties does not prohibit management from reviewing the award in accordance with 5 C.F.R. § 430.503(c), other statements by the Union establish that budgetary constraints are the only limitation on the requirement that an award be granted that is acknowledged by the provision.
In PTO we relied on our decision in Tidewater Virginia Federal Employees Metal Trades Council and U.S. Department of the Navy, Norfolk Naval Shipyard, Portsmouth, Virginia, 37 FLRA 938 (1990) (Proposal 2) (Norfolk Naval Shipyard), to conclude that performance awards proposals that mandate the granting of awards are inconsistent with 5 C.F.R. § 430.503(c) because they prevent the agency from reviewing and approving such awards as is required by that regulation.(10) As we explained in Norfolk Naval Shipyard, "the expressed authority to review and approve inherently encompasses the authority to review and disapprove." Id. at 950.
While this case was pending, 5 C.F.R. § 430.503(c) was removed by OPM in revising 5 C.F.R. part 430. 56 Fed. Reg. 20331, 20332 (1991). However, a new section, 430.504(d), that was added to part 430 contains a requirement for review and approval of decisions to grant awards that is similar to that formerly contained in section 430.503(c)(1).(11) In our view, the rationale that we applied in Norfolk Naval Shipyard to a proposal that mandated the granting of an award in the context of former section 430.503(c) applies equally to this provision in the context of section 430.504(d). Because Provision 3 mandates the granting of awards without regard to such review and approval and restricts the Agency's ability to disapprove awards, it is inconsistent with 5 C.F.R. § 430.504(d). The regulations governing performance awards, promulgated by OPM at 5 C.F.R. part 430, are Government-wide regulations. For example, PTO, 40 FLRA at 7 and Norfolk Naval Shipyard, 37 FLRA at 950-51. Provisions that are inconsistent with Government-wide regulations are outside the duty to bargain under section 7117 of the Statute. For example, id. Consequently, Provision 3 is nonnegotiable.
In view of our conclusion that Provision 3 is nonnegotiable based on its inconsistency with 5 C.F.R. § 430.504(d), it is unnecessary to address the Agency's contention that the provision is also inconsistent with 5 U.S.C. § 4302 and 5 C.F.R. §§ 430.203, 430.204 and 430.206(b). Also, it is unnecessary to address the parties' contentions as to the applicability of the court's decision in Langley Air Force Base.
The petition for review is dismissed insofar as it concerns Provisions 1 and 3. The Agency will rescind its disapproval of Provision 2.(12)
(If blank, the decision does not have footnotes.)
1. The Union has withdrawn two other provisions, Article 6, section 7 and Article 13, section 3, from its Petition for Review to the extent that they create an "arbitral appeal right" for excepted service employees who are not preference eligibles. Union reply brief at 2, 5. The Agency head had approved those two provisions except to the extent that they created an arbitral appeal right for excepted service employees who are not preference eligibles. Memorandum dated February 9, 1990, attachment to Union petition for review at 1 (Agency-head disapproval). Thus, the Union's withdrawal encompasses the only aspect of those two provisions that was disapproved and, consequently, the remaining aspects are not in dispute. The Union also has withdrawn a third provision, Article 13, section 3E. Union reply brief at 6. These three provisions will not be considered further in this decision.
2. The only definition of "TMEO" that is present in the record is "Trademark Examining Operation." Agency-head disapproval at 1.
3. U.S. Customs Service (Washington, D.C.) and U.S. Customs Service, Northeast Region (Boston, Massachusetts) and National Treasury Employees Union, Case No. 1-CA-70204 (1988), ALJ Decision Reports, No. 72 (July 15, 1988).
4. There is no such subsection as 5 C.F.R. § 297.204(c). We can only conclude that this reference is an error and that what is meant is 5 C.F.R. § 297.205.
6. In Langley Air Force Base, the court reversed the Authority's decision in National Association of Government Employees, Locals R4-26 and R4-106 and Department of the Air Force, Langley Air Force Base, Virginia, 32 FLRA 607 (1988), which found negotiable three proposals requiring that monetary awards be given to employees based on their performance ratings.
7. Specifically, the Union cites Article 31, section 1, which provides:
There is no entitlement to a performance award or other type of incentive award. All awards are subject to budgetary limitations and are paid at the discretion of the Office. The award plan in this article will be in effect beginning in FY 89 and will continue for FY 90, FY 91, and FY 92, unless amended by the new Agreement.
8. The Union cites Article 31, section 4, which provides:
If, due to a shortage of funds for awards, employees do not receive the full award for which they may be eligible, they will receive a pro rata share of the awards pool in accordance with the scale set forth in Section 3 as applicable.
9. We note that subsection B of the provision states that employees "shall" receive an award of a specified amount while subsection C states that employees "may" receive an award of a specified amount. While these terms could be taken to signify quite different meanings, the Union's statements do not indicate that subsection C is to be treated any differently than the rest of section 3 insofar as the Agency's obligation to give awards is concerned. Therefore, we make no distinctions among the various subsections as to the mandatory nature of the awards.
10. 5 C.F.R. § 430.503(c)(1) provided:
Agency procedures for making performance awards determinations must include a requirement for review and approval of each determination by
an official of the agency who is at a higher level than the official who made the initial decision, unless there is no official at a higher level in the agency, and also by the official(s) with responsibility for managing the performance awards budget within the agency.
11. Section 430.504(d) provides:
(d) The decision to grant a performance award, including the amount of such award, shall be reviewed and approved by an official of the agency who is at a higher level than the official who made the initial decision, unless there is no official at a higher level in the agency.
56 Fed. Reg. at 20333.
12. In finding that this provision is within the duty to bargain, we make no judgment as to its merits.