American Federation of Government Employees, Local 3240 (Union) and United States, Department of the Air Force, 325TH Support Group, Air Education and Training Command, Tyndall Air Force Base, Florida (Agency)

[ v58 p696 ]

58 FLRA No. 168

AMERICAN FEDERATION
OF GOVERNMENT EMPLOYEES
LOCAL 3240
(Union)

and

UNITED STATES
DEPARTMENT OF THE AIR FORCE
325TH SUPPORT GROUP
AIR EDUCATION AND TRAINING COMMAND
TYNDALL AIR FORCE BASE, FLORIDA
(Agency)

0-NG-2665

_____

DECISION AND ORDER ON NEGOTIABILITY ISSUES

July 15, 2003

_____

Before the Authority: Dale Cabaniss, Chairman, and
Carol Waller Pope and Tony Armendariz, Members

I.      Statement of the Case

      This case is before the Authority on a negotiability appeal filed by the Union under section 7105(a)(2)(D) and (E) of the Federal Service Labor-Management Relations Statute (the Statute), and concerns the negotiability of two proposals. For the reasons which follow, we find that the proposals are outside the duty to bargain.

II.      Proposals  [n1] 

      Proposal 1

      Beginning in 2003, the Agency's share of the premium for health insurance for nonappropriated fund employees will be set at an amount equal to 100% of the cost of coverage.

      Proposal 2

      Beginning in 2003, the Agency will offer to nonappropriated fund employees the option to participate in the Blue Choice Health Benefit Plan. Also beginning in 2003, the Agency will pay premiums for the plan equal to 100% of the premium for nonappropriated fund employees' coverage.

III.     Positions of the Parties

A.     Agency

      The Agency maintains that Proposal 1 is outside the duty to bargain because it conflicts with § 349 of the National Defense Authorization Act for Fiscal Year 1995, Public Law 103-337, 108 Stat. 2727 (Oct. 5, 1994) (Authorization Act). Section 349 required DoD, no later than October 1, 1995, to take such steps as may be necessary to provide a "uniform" health benefit program for all DoD nonappropriated fund (NAF) employees. [n2] The Agency states that in § 349's legislative history, Congress "note[d] that there were `major differences in provisions and premium contributions rates' and that those differences were `inconsistent with the national effort toward universal health care coverage.'" Statement of Position (SOP) at 2-3 (quoting House Report of the Committee on Armed Services 103-499 (May 10, 1994) (House Report)).

      The Agency argues that Proposal 1 "would make it impossible to provide a `single uniform health benefit program' for all DoD [NAF] employees." SOP at 5. According to the Agency, "[i]f one local union could negotiate a different percentage of premiums to be paid by the Agency, then other unions could also do so." Id. The Agency contends that such bargaining would reinstate the disparities that triggered the Congressional mandate, and the Agency would be violating the law by allowing a variety of differing premium contribution rates to proliferate.

      The Agency also asserts that Proposal 1 conflicts with Department of Defense (DoD) 1400.25-M, Sub-chapter 1408, Appendix 1, an Agency-wide regulation for which there is a compelling need. In this respect, the Agency notes that the proposal would require the Agency to pay 100% of the premiums, while the regulation requires the Agency to pay 70% of premiums for all NAF enrollees beginning in 2003.

      With respect to Proposal 2, the Agency maintains that it does not have authority to offer an additional health benefit plan to its NAF employees that differs from that provided under the DoD-wide uniform NAF Health Benefits Program. In this respect, the Agency notes that the addition of the Preferred Provider (PPO) Blue Choice Health Benefit Plan required by Proposal 2 [ v58 p697 ] would fall outside DoD's current arrangement with Aetna's PPO network coverage on a worldwide basis. The Agency maintains that if this proposal were found negotiable, then the uniformity mandated by § 349 would be compromised as collective bargaining with unions and DoD components could result in the addition of different non-Aetna PPO plans. SOP at 8. Further, with respect to the portion of Proposal 2 requiring the Agency to pay 100% of the premiums, the Agency asserts that this portion is contrary to law and regulation for the reasons stated as to Proposal 1.

B.     Union

      The Union maintains that the proposals are not contrary to law. The Union acknowledges that the Authorization Act mandates the "creation of a health benefits program that the Department of Defense must make available to all its NAF employees." Union's Response at 1. However, the Union argues that the Authorization Act "neither sets any premium formula nor prohibits the establishment of any additional health insurance programs to cover NAF employees." Id. In addition, the Union maintains that there is no compelling need for DoD 1400.25M, Sub-chapter 1408, Appendix 1. Id. at 2. Finally, the Union requests the Authority to sever the two portions of Proposal 2 if one is found to be nonnegotiable.

IV.     Meaning of the Proposals

      With respect to Proposal 1, the parties agree that the proposal would require the Agency to pay the entire amount of its nonappropriated fund (NAF) employees' health insurance premiums.

      With respect to Proposal 2, the parties agree that the proposal would require the Agency to offer NAF employees the option to enroll in the Blue Choice Health Benefit Plan, which is not currently offered by the Agency, and to pay the entire cost of the premiums for its NAF employees who choose to participate in that plan.

V.     Analysis and Conclusions

      We find that the proposals are contrary to law because they are inconsistent with the statutory mandate for uniformity under § 349 of the Authorization Act, and are therefore nonnegotiable.

      Section 349 of the Authorization Act required DoD, no later than October 1, 1995, to take such steps as may be necessary to provide "a uniform health benefits program for employees of the Department of Defense assigned to a nonappropriated fund instrumentality of the Department." In the legislative history of the Act, Congress emphasized that this provision would require DoD "to provide for a single uniform program" for NAF employees. House Rpt. 103-499. The House Report also noted that DoD components had offered comprehensive health insurance coverage to NAF employees in the past and that such plans have had "major differences in provisions and premium contribution rates . . . [which are] inconsistent with the national effort toward universal health care coverage." Id.

      The Authorization Act and its legislative history demonstrate that Congress intended DoD to establish one health benefits program with uniform provisions, including premium contribution rates, for all DoD NAF entities. Section 349 does not provide discretion to the heads of any of the six DoD components and their subordinate agencies to establish separate health benefit programs.

      We agree with the Agency that Proposal 1 "would make it impossible to provide a `single uniform health benefit program' for all DoD [NAF] employees[]" because "[i]f one local union could negotiate a different percentage of premiums to be paid by the Agency, then other unions could also do so." SOP at 5. Such bargaining would be inconsistent with the clear Congressional mandate of uniformity that was intended to address the differences in premium contribution rates throughout DoD for NAF employees. Similarly, if Proposal 2 were found negotiable, the uniformity mandated by § 349 would be negated because other unions could propose the addition of different plans.

      This case differs from NFFE, Local 29, 32 FLRA 721, 729-731 (1988). In that case, the Authority found that a different statute that required uniformity "insofar as practicable" for regulations issued by the Secretaries of military departments did not require the establishment of uniform procedures for civil service employees and members of the Armed Services. In so finding, the Authority noted that had Congress intended to mandate uniformity, it would not have expressly authorized agencies to exercise their discretion with regard to considerations of practicability. In contrast, in the legislation applicable to the instant case, Congress has expressed its intent to mandate uniformity.

      Similarly, this case differs from Dep't of the Navy v. FLRA, 952 F.2d 1434, 1443 (D.C. Cir. 1992). There, the court held that proposals that sought to regulate conditions of employment of employees in other bargaining units were nonnegotiable. In so holding, the court noted that, generally, the fact that two or more different bargaining units seek to negotiate over a matter that falls [ v58 p698 ] within a mandatory subject of bargaining does not render the matter non-negotiable. The court noted that "multi-unit (or "coordinated") bargaining may well be the appropriate solution on those rare occasions . . . when more than one bargaining unit legitimately can claim bargaining rights over a particular subject." Id. at 1443. However, the court found that "in the absence of such coordinated bargaining, however, each union may lay claim to a right to negotiate over matters within the compass of mandatory subjects of bargaining for employees within its designated bargaining unit." Id.

      That case did not involve a Congressional mandate that required uniformity on a department-wide basis. As noted above, if the proposals in the case before us were found to be negotiable, other proposals by other unions setting different employer contribution levels and PPO coverage would necessarily be negotiable, contrary to the Congressional mandate for uniformity. While it may be possible to formulate proposals that would be consistent with the department-wide uniformity in NAF health benefits programs mandated by Congress, the proposals before us do not achieve that goal.

      Consequently, we agree with the Agency that to sanction collective bargaining on these proposals would run counter to the nondiscretionary mandate for DoD-wide uniformity that the Authorization Act requires because it could lead to different agreements among the six DoD components and their subordinate agencies on premium contribution rates and PPO coverage.

      Accordingly, we find that the proposals are contrary to the Authorization Act and are, therefore, outside the duty to bargain. [n3] 


APPENDIX

1.     Section 349 of the National Defense Authorization Act for Fiscal Year 1995, Public Law 103-337, 108 Stat. 2727 (Oct. 5, 1994), provides that -

(a) IN GENERAL - Not later than October 1, 1995, the Secretary of Defense shall take such steps as may be necessary to provide a uniform health benefits program for employees of the Department of Defense assigned to a nonappropriated fund instrumentality of the Department.

2.     House Report of the Committee on Armed Services H. Rept. 103-499 (May 10, 1994) stated the following with regard to Nonappropriated Fund Health Benefits:

There are approximately 180,000 nonappropriated fund (NAF) employees in the Department of Defense who work in NAF instrumentalities (NAFI) in support of the military morale, welfare and recreation (MWR) program. In accordance with section 2105(c), title 5, United States Code, NAF employees are not Federal employees for purposes of most laws administered by the U.S. Office of Personnel Management. Consequently, they are excluded from civil service employee benefit programs, including the Federal Employee Health Benefit Program.

From 1942 to 1972, each NAFI established a health plan for its employees. The Army, Navy (Navy Exchange Service Command, Bureau of Naval Personnel and Marine Corps), Air Force, and the Army and Air Force Exchange Service each offer comprehensive health insurance coverage, including health maintenance organizations and preferred provider options. These plans have major differences in provisions and premium contribution rates and this is inconsistent with the national effort toward universal health care coverage. Accordingly, section 376 would require the Secretary of Defense to provide for a single, uniform program for nonappropriated fund employees.



Footnote # 1 for 58 FLRA No. 168 - Authority's Decision

   Both proposals were modified as set forth above during the post-petition conference.


Footnote # 2 for 58 FLRA No. 168 - Authority's Decision

   The text of this provision and other cited references is included in an Appendix at the end of this decision.


Footnote # 3 for 58 FLRA No. 168 - Authority's Decision

   Because both portions of Proposal 2 would be nonnegotiable, there is no need to address the Union's request to sever Proposal 2. In addition, because the proposals are inconsistent with law, we find it unnecessary to address th