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The decision of the Authority follows:
52 FLRA No. 133
FEDERAL LABOR RELATIONS AUTHORITY
AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES
U.S. DEPARTMENT OF VETERANS AFFAIRS
April 30, 1997
Before the Authority: Phyllis N. Segal, Chair; and Donald S. Wasserman, Member.
I. Statement of the Case
This case is before the Authority on exceptions to an award of Arbitrator Shyam Das filed by the Union under section 7122(a) of the Federal Service Labor-Management Relations Statute (the Statute) and part 2425 of the Authority's Regulations. The Agency did not file an opposition.
The Arbitrator denied a grievance alleging that the Agency violated the parties' Memorandum of Understanding (MOU) and the Statute by: (1) refusing to participate in impasse-resolution procedures with respect to Union proposals alleged to be outside the duty to bargain; (2) applying a new weighting procedure to its performance standards without first bargaining with the Union; and (3) unilaterally implementing new performance standards while the matter was pending before the Federal Mediation and Conciliation Service (FMCS).
For the following reasons, we set aside the portion of the award concluding that the Agency's failure to bargain over the new weighting procedure did not violate the Statute and remand the case to the parties for resubmission to the Arbitrator, absent settlement, for a decision consistent with this opinion. We deny the Union's remaining exceptions.
II. Background and Arbitrator's Award
After the Agency announced plans to establish new performance standards, the Union submitted more than 200 proposals. The Agency responded in writing to each, alleging that some were outside the duty to bargain. The parties negotiated and reached agreement over the proposals the Agency believed to be within the duty to bargain. Subsequently, the Agency notified the Union that it planned to implement the new standards in their entirety on a specified future date. At this point, the Union requested a mediator from the FMCS, the first step in the MOU's impasse-resolution procedures, but did not take further action to secure the FMCS' services.(1) The FMCS did not provide mediation services by the specified date, and the Agency implemented the new standards as planned.
The Union filed a grievance alleging that implementation of the new standards violated the MOU. According to the Union, the Agency's allegation that some of the proposals were outside the duty to bargain did not relieve the Agency of its obligation to follow the MOU's impasse-resolution procedures with respect to those proposals. According to the Agency, the Union's reliance on the impasse-resolution procedures was misplaced. In the Agency's view, the controlling provision of the MOU was Article 4, Section B(5), which directed the parties to resolve "[n]egotiation disputes" in a manner consistent with the Statute and its implementing regulations. Award at 3. The Agency asserted that the Statute does not require bargaining over proposals alleged to be nonnegotiable. The Statute, the Agency claimed, gives unions the option of either instituting a negotiability appeal or, if unilateral changes in conditions of employment have been made, filing an unfair labor practice charge.
At Step 3 of the grievance procedure, the Union learned that the Agency, while negotiations were under way, rated at least one employee as "exceptional," a performance level unavailable under the existing performance standards. Id. at 7. Consequently, the Union amended the grievance to allege that the Agency committed an unfair labor practice (ULP) by retroactively applying the proposed standards "prior to completion of [its] bargaining obligations." Id. at 5-6. The amended grievance also alleged that the Agency committed a ULP by unilaterally implementing the proposed standards "while under the auspices of the FMCS[.]" Id. at 6.
The Agency responded to the first ULP allegation by asserting that it did not retroactively apply the proposed standards. According to the Agency, it merely "weighted" the existing standards differently to account for unusual circumstances. Id. at 8. The record does not indicate whether the Agency responded to the second ULP allegation.
The grievance proceeded to arbitration and was denied in its entirety.(2) With respect to the MOU, the Arbitrator stated:
The [MOU] did not preclude [the Agency] from asserting that a particular proposal presented in negotiations by the Union was non-negotiable . . . nor did the [MOU] require that [the Agency] utilize the impasse procedure set forth in [Article 3, Section E] to resolve disputes over negotiability. On the contrary, [Article 4, Section B(5)] reflects the parties' understanding that such disputes were to be handled in accordance with the appropriate statutory and regulatory procedures. If the Union disagreed with [the Agency's] determination of non-negotiability, it had those procedures available to it.
Id. at 9.
The Arbitrator rejected the first ULP allegation--that the Agency retroactively applied the proposed standards prior to completion of bargaining--on the ground that the Agency merely "weight[ed]" the existing standards to account for "changed circumstances." Id. at 10. In this respect, the Arbitrator stated:
Without that weighting, none of the employees could have satisfied the requirements of the old standards, for reasons beyond their control. No employee was hurt by this weighting, and, under the circumstances, I see no legitimate basis on which to conclude that it violated any employee's statutory or contractual rights.
Id. The Arbitrator rejected the second ULP allegation--that the Agency unlawfully implemented the proposed standards after the Union contacted the FMCS--without providing specific reasons for his decision. In this regard, the Arbitrator stated only:
[T]he record before me does not establish that Management violated . . . [the] cited legal authority by not proceeding to utilize the impasse procedures set forth in the [MOU].
Id. at 11.(3)
III. Union's Exceptions
The Union challenges the award on five grounds. First, the Union contends that the Agency's action was "a violation of the [MOU]." Exceptions at 6. The Union argues that the Arbitrator misconstrued the MOU by applying Article 4, Section B(5) instead of Article 3, Section E.
Second, the Union contends that the award "failed to comply with the laws, rules and regulations on the subject of unilateral implementation during mediation/impasse." Id. Specifically, the Union argues that "implementation of any new or changed performance factors while negotiations are under a mediator's jurisdiction is a violation" of the Statute. Id.
Third, the Union contends that the award "failed to comply with 5 USC 7117(c), 5 CFR 2424.3, and prevailing case law." Id. at 4. In the Union's view, after the Agency alleged that certain proposals were outside the duty to bargain, the Union had the option of either initiating a negotiability appeal or "continu[ing] its attempts to reach agreement with the [A]gency[.]" Id. Because it chose to contact the FMCS in an attempt to reach agreement with the Agency, the Union asserts, the Agency was obligated to participate in the impasse procedures that were to ensue.
Fourth, the Union contends that the award "was deficient . . . under 5 CFR 430[.]" Id. at 6. According to the Union, 5 C.F.R. § 430 states that "among matters that are bargainable, the Authority specifically noted that agencies have a duty to bargain with exclusive representatives on such aspects of appraisal systems" and that "[a]ny changes in the standards or critical elements also need to be communicated and discussed with the employee." Id. at 5.
Finally, the Union contends that the award "failed to comply with existing laws, rules and regulations on changes to conditions of employment." Id. Specifically, the Union argues that "[the] modified old standards were, in effect, new standards" and, therefore, the Agency had a duty to bargain over them under section 7116(a)(1) and (5) of the Statute. Id.
IV. Analysis and Conclusions
A. The Award Does Not Fail to Draw Its Essence From the MOU
We construe the Union's first exception as a claim that the award fails to draw its essence from the MOU because the Arbitrator applied Article 4, Section B(5) instead of Article 3, Section E. Article 4, Section B(5) addresses "[n]egotiation disputes," and directs how the parties should proceed "[i]f any proposal is claimed to be non-negotiable[.]" Award at 3. As the grievance concerned what action, if any, the Agency was obligated to take after alleging that some of the Union's proposals were nonnegotiable, the Arbitrator's decision to apply Article 4, Section B(5) was not implausible, irrational, or unconnected to the wording of the MOU. Accordingly, we conclude that the award does not fail to draw its essence from the MOU, and we deny the exception. See United States Department of Labor (OSHA) and National Council of Field Labor Locals, 34 FLRA 573, 575-77 (1990).
B. The Award Is Not Deficient Under Section 7116(a)(1), (5), and (6) of the Statute
We construe the Union's second exception as a claim that the award is contrary to section 7116(a)(1), (5), and (6) of the Statute because the Agency unilaterally implemented the proposed standards after the Union contacted the FMCS. As this exception involves the award's consistency with law and regulation, we review the questions of law and regulation raised by the exception and the Arbitrator's award de novo. See National Treasury Employees Union, Chapter 24 and U.S. Department of the Treasury, Internal Revenue Service, 50 FLRA 330, 332 (1995) (citing U.S. Customs Service v. FLRA, 43 F.3d 682, 686-87 (D.C. Cir. 1994)).(4)
The Authority has held that an agency's failure to maintain the status quo to the extent consistent with the necessary functioning of the agency while impasse proceedings are under way constitutes a violation of section 7116(a)(1), (5) and (6). See, e.g., Department of Veterans Affairs, Veterans Administration Medical Center, Decatur, Georgia, 46 FLRA 339, 345-46 (1992). But see U.S. Department of Justice, Immigration and Naturalization Service v. FLRA, 995 F.2d 46, 48 (5th Cir. 1993) (Department of Justice) (holding that unilateral implementation during impasse proceedings of a proposal later determined to be nonnegotiable does not violate the Statute). Here, there is no evidence in the record that impasse proceedings were under way following the Union's letter to the FMCS. Accordingly, we deny the exception.(5) See Department of the Air Force, Scott Air Force Base, Illinois, 33 FLRA 532, 547 (1988) (Scott) (holding that union's letter to FMCS, without more, did not require agency to maintain status quo), aff'd sub nom. National Association of Government Employees, Local R7-23 v. FLRA, 893 F.2d 380 (1990).
C. The Award Is Not Deficient Under Section 7117(c) of the Statute and Its Implementing Regulations
We construe the Union's third exception as a claim that the award is contrary to section 7117(c) of the Statute, section 2424.3 of the Authority's Regulations, and Authority case law interpreting these sections.
Under section 7117(c) of the Statute, an "exclusive representative may, on or before the 15th day after the date on which the agency first [alleges that the duty to bargain in good faith does not extend to any matter], institute an appeal under this subsection[.]" Under section 2424.3 of the Authority's Regulations, "[t]he exclusive representative shall request such allegation in writing[.]" As the Union points out, the Authority, in interpreting these sections, has held that "if a Union receives an unsolicited allegation of nonnegotiability . . . the Union has two options for filing a timely petition for review: (1) respond to the unsolicited allegation of nonnegotiability and timely file a petition for review with the Authority; or (2) ignore the unsolicited allegation of nonnegotiability . . ., make a written request for a written allegation of nonnegotiability from the agency, and [then] timely file its petition for review of the solicited allegation with the Authority." E.g., National Federation of Federal Employees, Local 422 and U.S. Department of the Interior, Bureau of Indian Affairs, Colorado River Agency, Parker, Arizona, 50 FLRA 541, 543 (1995).
The record in this case shows that the Union, after submitting proposals to the Agency, received unsolicited allegations that some of the proposals were outside the duty to bargain. At this point, the Union opted to ignore the unsolicited allegations. The Union cites no authority, and none is apparent to us, supporting the contention that, by doing so, the Union obligated the Agency to participate in negotiations under the MOU. Accordingly, we conclude that the award is not contrary to section 7117(c) of the Statute, section 2424.3 of the Authority's Regulations, or Authority case law interpreting these sections, and we deny the exception.
D. The Award Is Not Deficient As Contrary to 5 C.F.R. § 430
Although 5 C.F.R. § 430 states that agencies "shall . . . [c]ommunicat[e] performance plans to employees," this language was not intended to create bargaining obligations over and above those required by the Statute. See OPM Final Rule on 5 C.F.R. Parts 430 et al., 60 Fed. Reg. 43,935, 43,936 (1995) (clarifying that regulation does not require bargaining over performance standards); id. at 43,937 (explaining that agencies must involve employees in the design and implementation of performance standards only to the extent required by the Statute). Accordingly, we conclude that 5 C.F.R. § 430 is not a basis on which to find the award deficient, and we deny the exception.
E. The Record Is Insufficient for a Determination as to Whether the Award Is Deficient Under Section 7116(a)(1) and (5) of the Statute
We construe the Union's fifth exception as a claim that the award is contrary to section 7116(a)(1) and (5) of the Statute because the Agency did not give the Union an opportunity to bargain over the new weighting procedure applied to the existing performance standards.
Under section 7116(a)(1) and (5), an agency must give the exclusive representative of its employees an opportunity to bargain over the substance of any change in conditions of employment that is within the duty to bargain. U.S. Department of Veterans Affairs, Veterans Administration Medical Center, Memphis, Tennessee, 42 FLRA 712, 713 (1991). Even where the substance of a change is outside the duty to bargain, an agency must give the exclusive representative an opportunity to bargain over the impact and implementation of the change, provided that the change has more than a de minimis effect on unit employees' conditions of employment. Id. The Authority has established the following framework for determining whether the effect of a change is de minimis:
[P]rincipal emphasis [should be placed] on such general areas of consideration as the nature and extent of the effect or reasonably foreseeable effect of the change on conditions of employment of bargaining unit employees. Equitable considerations will also be taken into account in balancing the various interests involved.
As to the number of employees involved, this factor will not be a controlling consideration. It will be applied primarily to expand rather than limit the number of situations where bargaining will be required. For example, [the Authority] may find that a change does not require bargaining. However, a similar change involving hundreds of employees could, in appropriate circumstances, give rise to a bargaining obligation. The parties' bargaining history will be subject to similar limited application.
Department of Health and Human Services, Social Security Administration, 24 FLRA 403, 407-08 (1986) (SSA). See also General Services Administration, National Capital Region, Federal Protective Service Division, Washington, D.C., 52 FLRA 563, 566-68 (1996) (applying SSA).
Changing the weighting of performance standards is an action that is within management's rights and, therefore, the Agency's decision to apply a new weighting procedure to the existing performance standards was outside the duty to bargain. Cf. American Federation of Government Employees, Local 1164 and U.S. Department of Health and Human Services, Social Security Administration, District Office, Worcester, Massachusetts, 49 FLRA 1408, 1414-16 (1994) (holding that proposal to weight existing performance standards affected management's rights to assign work and direct employees). Accordingly, the Agency had no duty to bargain over the substance of the new weighting procedure. If, however, the weighting procedure had more than a de minimis effect on conditions of employment of unit employees, then the Agency had a duty to bargain over its impact and implementation.
The award under review does not contain a determination as to whether the effect of the new weighting procedure on unit employees' conditions of employment was more than de minimis, and the Arbitrator did not make findings of fact on which the Authority could base that determination. For instance, there are no findings as to how the weighting procedure affects promotions, compensation, discipline, scheduling, work assignments, and the like. In addition, there are no findings as to the number of employees affected by the weighting procedure or the parties' bargaining history. Although the Arbitrator did find that "[n]o employee was hurt by [the] weighting," the Authority has stated that "the equity, hardship, or burdens involved" do not, without more, provide a basis for resolving the de minimis issue. U.S. Department of the Treasury, Customs Service, Washington, D.C., 38 FLRA 770, 783 (1990).
Absent these findings by the Arbitrator, we have no basis on which to review the award for legal sufficiency. Accordingly, we set aside the portion of the award concluding that the Agency's failure to bargain over the new weighting procedure did not violate the Statute and remand the case to the parties for resubmission to the Arbitrator, absent settlement, for a decision consistent with this opinion. E.g., U.S. Department of Commerce, Patent and Trademark Office and National Treasury Employees Union, Chapter 243, 52 FLRA 358, 372-74 (1996) (PTO).
The de minimis finding central to determining the statutory claim at issue must be made in accordance with the law applicable to such claims. In this regard, under Authority precedent, standards and burdens of proof set forth in law, rule, or regulation extend to arbitrations. E.g., American Federation of Government Employees, Local 2250 and U.S. Department of Veterans Affairs, Medical Center, Muskogee, Oklahoma, 52 FLRA 320, 323-24 (1996). For ULPs litigated under section 7118 of the Statute, both the standard and burden of proof are clearly established. See 5 U.S.C. § 7118(a)(7) and (8) (requiring ULP allegation to be proved by a preponderance of the evidence); 5 C.F.R. § 2423.18 (placing burden of proof on proponent of allegation).(6) Applying these requirements that govern a ULP proceeding in this arbitration would place the burden on the Union to prove the elements of the alleged ULP by a preponderance of the evidence.
Requiring arbitrators to apply the same standards and burdens as administrative law judges is consistent with the Authority's decision in National Treasury Employees Union and Federal Deposit Insurance Corporation, Washington, D.C., 48 FLRA 566 (1993), which cited with approval the following statement of the U.S. Court of Appeals for the D.C. Circuit:
By providing for a choice of forum, section 7116(d) [of the Statute] assumes that a similar analytical approach would be followed--if not the same result reached--by both the arbitrator and the Authority with respect to matters over which there is concurrent jurisdiction.(7)
. . . [Otherwise,] section 7116(d)'s promise of a choice of forum is illusory . . . .
Id., 48 FLRA at 570 (quoting IRS v. FLRA, 963 F.2d 429, 438 (D.C. Cir. 1992)). The stated assumption that arbitrators will follow "a similar analytical approach" and reach "the same results" as administrative law judges accords with the expectation that arbitrators will apply the same standards and burdens of proof as administrative law judges. Requiring arbitrators to apply the same standards and burdens also is consistent with section 7123(a)(1) of the Statute, which permits judicial review of Authority orders in arbitration cases that "involve an unfair labor practice under section 711 of this title[.]" In connection with the latter point, such a requirement would both facilitate judicial review and promote the development of a uniform body of ULP law.
The Authority, in reviewing arbitration awards addressing questions of law in other contexts, has required arbitrators to apply the same standards and burdens that would have attached if the questions had been adjudicated in their traditional fora. E.g., U.S. Department of the Treasury, U.S. Customs Service, El Paso, Texas and National Treasury Employees Union, Chapter 143, 52 FLRA 622, 626-28 (1996) (Rehabilitation Act of 1973); PTO, 52 FLRA at 361-62 (Title VII); National Association of Government Employees, Local R1-109 and Department of Veterans Affairs, Medical Center, Newington, Connecticut, 51 FLRA 1720, 1722-24 (1996) (5 C.F.R. § 630.401(a)(2)); U.S. Department of the Navy, Naval Surface Warfare Center, Crane Division, Crane, Indiana and American Federation of Government Employees, Local 1415, 49 FLRA 27, 29-30 (1994) (Fair Labor Standards Act). We see no reason to require arbitrators to follow a different approach in addressing ULP allegations. In addition, treating statutory burdens of proof as substantive requirements that apply to arbitrations also is consistent with U.S. Supreme Court precedent. See, e.g., Rodriguez de Quijas v. Shearson/American Express, Inc., 490 U.S. 477, 481-82 (1989) (addressing the arbitration of statutory claims under the Federal Arbitration Act, 9 U.S.C.A. §§ 9-16, 201-208, 301-307 (1970 & Supp. 1997)). Cf. Palmer v. Hoffman, 318 U.S. 109, 116-17 (1943) (affirming federal court's decision in diversity case to apply burden of proof established by state law).
Based on the foregoing, we conclude that the Union, on remand, has the burden of establishing, by a preponderance of the evidence, the elements necessary for a conclusion that the Agency violated the Statute as alleged.
The Union's first four exceptions are denied. The portion of the award concluding that the Agency's failure to bargain over the new weighting procedure did not violate the Statute is set aside. The case is remanded to the parties for resubmission to the Arbitrator, absent settlement, for further proceedings consistent with this decision.
Article 3, Section E of the MOU provides in pertinent part:
Impasse - Should the parties reach an impasse the following procedures will apply:
a. The Federal Mediation and Conciliation Service (FMCS) will be notified to provide a federal mediator to assist the parties in resolving the dispute.
b. Should the assistance of the FMCS fail, the party rejecting the other party's last proposals shall contact the Federal Service Impasse Panel (FSIP) for final resolution of all outstanding proposals.
c. Both parties agree that every effort should be made to reach an agreement while issues are pending before the FSIP.
Award at 2-3.
Article 4, Section B(5) of the MOU provides:
The agreement shall not be finalized until all proposals have been disposed of by mutual consent. Negotiation disputes, including questions of negotiability and impasse items, will be processed in a manner consistent with 5 USC 71 and implementing regulations. This will not serve as a bar to the parties concluding by mutual consent a general agreement on those items which have been or remain to be negotiated. If any proposal is claimed to be non-negotiable by either party and subsequently determined to be negotiable or the declaring party withdraws its allegations of non-negotiability, the proposal will, upon request, be reopened within a reasonable period of time. Such a request will be made within 30 calendar days.
Id. at 3.
(If blank, the decision does not have footnotes.)
1. The MOU's impasse-resolution procedures appear in Article 3, Section E. The pertinent text of Article 3, Section E, and other relevant provisions of the MOU, are set forth in the Appendix.
2. The parties did not stipulate the issues, and the Arbitrator did not formulate issue statements. However, the record shows that the hearing on the Union's first ULP allegation--that the Agency prematurely implemented new performance standards under the guise of "weighting"--included arguments that the Agency should have bargained over the new weighting procedure even if the procedure merely modified the existing standards. Exceptions, Attachment E at 5.
3. The award also addressed whether the Agency violated an agreement to use interest-based bargaining. That portion of the award is not relevant to the Union's exceptions and, therefore, we do not discuss it.
4. The Union's remaining exceptions also involve the award's consistency with law and regulation. Therefore, we will also review them under a de novo standard.
5. We note that the facts of the case now before us are distinguishable from those in Department of Justice because Department of Justice addresses an agency's obligations after impasse procedures are under way. Moreover, there is no basis on which to apply the court's holding in Department of Justice to the record in this case because there is no evidence or argument as to the outcome of the parties' negotiability dispute. In particular, the proposals at issue do not appear in the record, and a review of Authority case law indicates that they were not the subject of a separate Authority decision.
6. 5 U.S.C. § 7118(a)(7) provides in pertinent part:
If the Authority . . . determines after any hearing on a complaint . . . that the preponderance of the evidence received [supports] an unfair labor practice [finding], then the [Authority] shall issue . . . an order [specifying the remedial action to be taken].
5 U.S.C. § 7118(a)(8) provides in pertinent part:
If the [Authority] determine[s] that the preponderance of the evidence received fails to [support] an unfair labor practice [finding], the [Authority] . . . shall issue an order dismissing the complaint.
5 C.F.R. § 2423.18 provides:
The General Counsel shall have the responsibility of presenting the evidence in support of the complaint and shall have the burden of proving the allegations of the complaint by a preponderance of the evidence.
This section is consistent with the Administrative Procedure Act, 60 Stat. 237 (1946), which provides in pertinent part: "Except as otherwise provided by statute, the proponent of a rule or order has the burden of proof." 5 U.S.C. § 556(d).
7. Section 7116(d) of the Statute provides, in effect, that ULP allegations may be submitted to either an arbitrator or an administrative law judge.