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U.S. Federal Labor Relations Authority

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54:0471(47)RP - - VA, Hunter Holmes McGuire Medical Center & AFGE Local 2145 - - 1998 FLRAdec RP - - v54 p471

[ v54 p471 ]
The decision of the Authority follows:

54 FLRA No. 47









LOCAL 2145





June 19, 1998


Before the Authority: Phyllis N. Segal, Chair; Donald S.

Wasserman and Dale Cabaniss, Members.

I. Statement of the Case

This case is before the Authority on the Union's application for review of the Regional Director's (RD's) denial of the Union's petition to represent individuals participating in a Compensated Work Therapy (CWT) program at the Agency. The RD concluded that these individuals are not employees under section 7103(a)(2) of the Federal Service Labor-Management Relations Statute (the Statute). The Union asserts that the petition involves an issue of first impression warranting review pursuant to section 2422.31(c)(1) of the Authority's regulations. The Union also argues that the RD erred with respect to a substantial factual issue, warranting review pursuant to section 2422.31(c)(3)(iii) of the regulations. The Agency filed an opposition.

For the following reasons, we grant review under section 2422.31(c)(1). We conclude that the RD did not err in denying the Union's petition, and we dismiss the petition.

II. Background and Regional Director's Decision

In 1994, in response to a budget shortfall, the Agency reduced its staff of temporary employees. The Agency hired some of these former temporary employees as permanent employees and placed others, who were veterans and determined to be eligible for such placement, in its local CWT Program (the Agency CWT Program). Generally, the CWT Program is a Department of Veterans Affairs (VA) "rehabilitative program," established pursuant to 38 U.S.C. § 1718(a), in which eligible veterans work for a variety of organizations, including VA itself.(1) Agency Ex. H, I; VA Manual 4.04(b). The RD found that the Agency CWT Program "was initiated at the VAMC to provide supervised work therapy for veterans prior to resuming gainful employment in the community." RD's Decision at 2.

With regard to whether CWT participants are "employees," the RD noted that section 7103(a)(2) of the Statute defines employees as individuals who are employed in an agency.(2) In determining whether Agency CWT participants fall within this definition, the RD relied on the statutory language and legislative history of 38 U.S.C. § 1718(a). The RD found that Congress amended section 1718(a) in 1962 with the specific purpose of making clear that those who work for therapeutic and rehabilitative purposes are not federal employees. Id. at 8-9 (citing S. Rep. No. 1693 (1962), reprinted in 1962 U.S.C.C.A.N. 2101, 2102-03). The RD concluded that the fact that CWT participants perform work similar to that performed by federal employees is not dispositive of their status as federal employees. The RD also reasoned that the fact that a budget shortfall may have led to the creation of the CWT Program did not operate to grant participants federal employee status. Id. at 10.

The RD considered private sector case law concerning work with a claimed rehabilitative purpose. He stated that, in the private sector, whether an individual performing such work is considered an employee is determined by whether the relationship between the worker and employer is characterized by business or therapeutic considerations. Id. at 10-11 (citing Davis Memorial Goodwill Industries, 318 NLRB 1044 (1995); Goodwill Industries of Tidewater, Inc., 304 NLRB 767 (1991) (Goodwill Industries); and Lighthouse for the Blind of Houston, 244 NLRB 1144 (1979)). The RD found that "the factual scenario here is one where the sustaining relationship between an individual in the CWT Program and the VAMC is therapeutic, not pecuniary." Id. at 12. Accordingly, he concluded that the participants are not employees under the Statute, and that they are not eligible to be represented by an exclusive representative.

III. Positions of the Parties

A. The Union

First, the Union argues that 38 U.S.C. § 1718(a) does not govern the Agency CWT Program. In this regard, the Union asserts that, for many veterans, section 1718(a) does not govern the providing of vocational rehabilitative services. Application for Review at 4-5. According to the Union, because section 1718(a) does not apply to the Agency CWT participants, the RD wrongly concluded that this section limited the applicability of the Statute.

Second, the Union maintains that the Agency has not followed the VA's regulatory requirements for CWT Programs generally. Id. at 6. The Union asserts that the "diagnosis" used to refer Agency CWT participants to the program often did not reflect "rehabilitation needs" and that other elements of rehabilitation are missing in the program. Id. at 7-8.

Third, the Union argues that National Labor Relations Board (NLRB) precedent supports its position. Id. at 13 (citing Arkansas Lighthouse for the Blind and Chauffeurs, Teamsters and Helpers Local Union 878, 284 NLRB 1214, 1216 (1987)). The Union asserts that in the case of Agency CWT participants, business considerations are predominant because they do not receive professional counseling, training, or outside job placement, and because the CWT participants work under conditions essentially identical to the conditions under which permanent employees work.

Finally, the Union asserts that failure to recognize the participants as employees under 5 U.S.C. § 7103(a)(2) results in a deprivation of the participants' First Amendment right to freedom of association because the participants are deprived of the right to join a union.

B. The Agency

The Agency maintains that the Union has not demonstrated that 38 U.S.C. § 1718(a) is inapplicable to CWT participants, and that the Union has not provided any basis for concluding that the Statute supersedes title 38. Agency Response at 1, 2.

The Agency asserts further that the Union has not addressed relevant case law concerning the authority of the Agency to determine "conditions of employment of VA medical personnel[.]" Id. at 1 (citing National Federation of Federal Employees, Local 589 v. FLRA, 73 F.3d 390 (D.C. Cir. 1996) (NFFE)). According to the Agency, "unless and until Congress decides to extend Chapter 71 of Title 5 . . . the presumption [is ] that the Secretary [of the Department of Veterans Affairs] has complete discretion over conditions of employment of VA medical personnel." Id. (quoting NFFE, 73 F.3d at 395).

Additionally, the Agency asserts that similarities in the working conditions of participants and federal employees are not determinative of whether the participants are employees. The Agency maintains that such similarities in working conditions simply help CWT participants learn to function in a normal work environment. The Agency also argues that Goodwill Industries, which concerns participation in a rehabilitative work program, supports the conclusion that CWT participants are not federal employees. Id. at 2.

IV. Analysis

A. The Case Presents an Issue of First Impression

The central issue in this case is whether the RD correctly determined that CWT participants who work at the Agency are not "employed in" the Agency as defined in section 7103(a)(2) of the Statute. The Union requests review on the ground that this is an issue for which there is no precedent. 5 C.F.R. 2422.31(c)(1). The Authority has not previously examined the employment status of individuals in the title 38 CWT rehabilitative work program. Thus, we grant the application for review under section 2422.31(c)(1) to consider this issue.(3)

B. Participants in the CWT Program are not Employees under the Statute

1. Section 1718(a) applies to these individuals

Section 7103(a)(2) of the Statute provides that an "employee" is an individual "employed in an agency[.]" However, under Authority precedent, specific provisions outside the Statute that dictate whether a particular class of individuals encompasses federal employees have been found conclusive in assessing the individuals' status.(4) This is consistent with the general rule of statutory construction that specific provisions targeting a particular issue control provisions more generally covering the issue. See Radzanower v. Touche Ross & Co., 426 U.S. 148, 153 (1976) (quoting Morton v. Mancari, 417 U.S. 535, 550-51 (1974)).

Section 1718(a) of title 38 states that participants in rehabilitative work programs under that section "shall not . . . be held or considered as employees of the United States for any purpose." 38 U.S.C. § 1718(a) (emphasis added). The specific terms of section 1718(a), indicating that participants who fall under this program are not employees of the Agency for any purpose, thus provide a clarification or limitation on section 7103(a)(2)'s general proposition that individuals "employed in an agency" are covered by the Statute.(5) As the Union acknowledges, section 1718 operates as a "statutory exclusion" from the Statute. Application for Review at 12.

The Union asserts, however, that this exclusion does not apply to the individuals it seeks to represent. The Union argues that CWT Program services may also be provided under Chapter 31 of title 38, as well as Chapter 17 of that title, which contains section 1718(a). The Union asserts that section 1701(8) acknowledges that Chapter 31 vocational rehabilitative services are distinct from Chapter 17 services. In effect, the Union argues that the Agency CWT Program should be considered to be a Chapter 31 program, rather than a Chapter 17 program. According to the Union, the exclusion of section 1718(a) would not apply to individuals participating in the CWT Program pursuant to Chapter 31.

We conclude that the Union's statutory analysis is flawed. As an initial matter, it is not apparent that the definition of "rehabilitative services," relied on by the Union, is relevant to determining the status of the individual participants in the CWT Program. Reading the term "rehabilitative services" in context, section 1718(a) can be construed as describing services provided by CWT participants, not provided to these individuals.

However, even if, as the Union claims, the definition of services under Chapter 31 for all veterans excludes services provided to CWT participants under Chapter 17, this would not turn the Agency's CWT Program, which was established under Chapter 17, into a program under Chapter 31. Every indication in the record confirms that CWT Programs generally are authorized by, and operated under, Chapter 17 as rehabilitative programs for physically and mentally disabled veterans. See Agency Exhibit H, VA Manual 4.04 (establishing Agency-wide CWT Program). As an evaluative report contained in the record explains, the "CWT program is a therapeutic work-for-pay program authorized nearly 20 years ago by Public Law 94-581 [§ 105, now codified as 38 U.S.C. § 1718]." Agency Exh. I at I. That Chapter 31 programs may exist does not establish that the Agency CWT Program, or CWT Programs generally, are Chapter 31 programs.

In addition, while the Union asserts that the individuals it seeks to represent are non-disabled veterans who are entitled to utilize programs under Chapter 31, but not Chapter 17, it has offered no evidence to that effect. The facts presented by the Union support its view that the particular documentation used by certain participants to enter the Agency CWT Program were inadequate. They do not establish that these individuals are not entitled to utilize programs created under Chapter 17.

The Union's second general argument is that section 1718(a) does not govern the Agency CWT participants because the Agency is not complying with VA's own regulations concerning CWT Programs, and is not observing the regulations' requirements concerning the rehabilitation of participants. Id. at 6, 8, 11. In this regard, the Union has not supplied the regulations to which it refers, and does not point to record evidence to support its factual assertions. Moreover, even if the Union established that the CWT participants are not bona fide Chapter 17 participants, this would not establish that they are federal employees. There is no allegation by the Union that the Agency did not, in fact, abolish the prior temporary positions of these employees. Thus, proof that these individuals are not Chapter 17 participants would appear to leave them with no employment at all, rather than establish that they are federal employees.(6)

2. NLRB Precedent is not relevant to determine whether CWT Participants are Federal Employees

The Union asserts that under NLRB precedent, status as an employee is determined by whether the relationship between the individual and employer is a "business" or "rehabilitative" relationship. Application for Review at 13. The RD applied the NLRB precedent cited by the Union and determined that the relationship between the CWT participants and the Agency was rehabilitative.

We conclude that the NLRB precedent is not relevant in this context. As a general rule, "the degree of relevance of private sector case law to public sector labor relations will vary greatly depending upon the particular statutory provisions and legal concepts at issue." Library of Congress v. FLRA, 699 F.2d 1280, 1287 (D.C. Cir. 1983). Here, the dictate of section 1718(a) provides specific guidance on the issue of whether Agency CWT participants are employees under the Statute and reference to analogous private sector principles is not appropriate.

3. The First Amendment Does not Require that these Individuals be Considered Employees under the Statute

The Union asserts that if the CWT participants are not given the opportunity to certify the Union as their exclusive representative, the participants' right to free association will be violated.

The Supreme Court has directly addressed this point:

the public employee surely can associate and speak freely and petition openly, and he is protected by the First Amendment from retaliation for doing so. But the First Amendment does not impose any affirmative obligation on the government to listen, to respond or, in [the employment] context, to recognize the association and bargain with it.

Smith v. Arkansas State Highway Employees, Local 1315, 441 U.S. 463, 465 (1979) (citations omitted). Thus, while the First Amendment protects the right of CWT participants to associate with one another, it does not dictate that they be considered "employees" entitled to recognition under the Statute.

V. Decision

The application for review is granted with respect to the Union's request that the Authority determine whether CWT participants are employees for purposes of section 7103(a)(2). On review, we determine that such individuals are not employees and the representation petition is dismissed.

The application is denied with respect to the allegation that the RD committed factual error.

(If blank, the decision does not have footnotes.)

1. 38 U.S.C. § 1718(a) provides that:

In providing rehabilitative services under this chapter, the Secretary, upon the recommendation of the Chief Medical Director may use the services of patients and members in Department health care facilities for therapeutic and rehabilitative purposes. Such patients and members shall not under these circumstances be held or considered as employees of the United States for any purpose. The Secretary shall prescribe the conditions for the use of such services. (Emphasis added).

2. Section 7103(a)(2) defines "employee," with exceptions not relevant here, as an individual:

(A) employed in an agency; or

(B) whose employment in an agency has ceased because of any unfair labor practice under section 7116 of this title and who has not obtained any other regular and substantially equivalent employment, as determined under regulations prescribed by

the Federal Labor Relations Authority

. . . .

3. The Union also alleges that this case warrants review pursuant to section 2422.31(c)(3) of our regulations because the RD made prejudicial errors concerning a substantial factual matter in describing the level of rehabilitation provided by the Agency. The facts in question are relevant to the Union's argument that CWT participants would be considered employees under NLRB precedent. See supra Part II. As we find in this decision that the NLRB's standard is not relevant to the employment status of individuals participating in the Agency's CWT Program, see, infra Part V.B.2, the alleged errors do not concern a substantial factual matter, and we deny review on this ground.

4. See Phoenix Area Indian Health Service, Sacaton Service Unit, Hu Hu Kam Memorial Hospital, Sacaton, Arizona and Southwest Native American Health Care Employees, Local 1386, LIUNA, AFL-CIO and Southwest Native American Health Care Employees, Local 1386, LIUNA, AFL-CIO and Phoenix Area Indian Health Service, Sacaton Service Unit, Hu Hu Kam Memorial Hospital, Sacaton, Arizona, 53 FLRA 1200 (1998), reconsideration denied, 54 FLRA No. 34 (1998), (Hu Hu Kam) (individuals detailed to work at an Indian health care facility remain section 7103(a)(2) employees, because 5 U.S.C. § 3373 dictates that they remain employees of agency); Panama Canal Commission and International Organization of Masters, Mates and Pilots Marine Division ILA, AFL-CIO, Panama Canal Pilots Branch, 33 FLRA 15, 21 (1988) (Commission employees who are noncitizen of the United States employed outside the United States are federal employees, despite section 7103(a)(2)(B)(I)'s exclusion of such employees from the definition of federal employee, because 22 U.S.C. § 3701(a) states that they are considered to be employees). See also Volunteers in Service to America (VISTA) and National Vista Alliance, 1 A/SLMR 445 (1971) (VISTA volunteers are not federal employees because the Economic Opportunity Act explicitly states that they are not federal employees).

5. We reject the Agency's assertion that the result in this case is controlled by title 38's specific directive stating that the Secretary controls the working conditions of VA's Department of Medicine and Surgery. See generally NFFE, 73 F.3d at 392, 395. That directive does, however, demonstrate that specific exclusions from the Statute are a recognized feature of title 38. In this case, Congress specifically provided that individuals working in rehabilitative programs pursuant to 38 U.S.C. § 1718(a) do not have federal employee status "for any purpose," and this specific directive has a similar limiting effect on rights set out in the Statute.

6. The Union asserts that the Agency's action was motivated by a budget shortfall and not rehabilitative aims, and that the Agency is using the CWT Program as a subterfuge to avoid budget restrictions. We note that an Agency's motivation in terminating a former employee may relate to a claim that a former employee should be considered an employee pursuant to section 7103(a)(2)(B) of the Statute, which concerns employees who have established that they lost their status as federal employees through an unfair labor practice. This is not, however, an unfair labor practice case in which the Union has alleged that the Agency committed an unfair labor practice.