[ v63 p42 ]
63 FLRA No. 15
INTERNATIONAL BROADCASTING BUREAU
BROADCASTING BOARD OF GOVERNORS
WASHINGTON, D.C.
(Agency)
and
AMERICAN FEDERATION
OF GOVERNMENT EMPLOYEES
LOCAL 1812, AFL-CIO
(Union/Petitioner)
WA-RP-08-0019
_____
ORDER DENYING
APPLICATION FOR REVIEW
December 12, 2008
_____
Before the Authority: Thomas M. Beck, Chairman and
Carol Waller Pope, Member [n1]
I. Statement of the Case
This case is before the Authority on an application for review filed by the Union under § 2422.31 of the Authority's Regulations. [n2] The Agency did not file an opposition to the Union's application for review.
The Union filed a petition seeking to represent, for purposes of collective bargaining, all of the Purchase Order Vendors (POVs) who contract with the Agency to provide video editing services. The Regional Director (RD) dismissed the petition, finding that the POVs are independent private contractors, and not federal employees covered by the Federal Service Labor-Management Relations Statute (the Statute).
For the reasons that follow, we deny the application for review.
II. Background and RD's Decision
A. Background
The Union, which represents an existing unit of general schedule and wage grade employees employed by the Agency, filed a petition seeking to represent a separate unit of all POVs. At the time the petition was filed, there were forty-nine POVs working for the Agency.
The POVs provide video editing services to the Agency as a "private sector source," pursuant to the Federal Activities Inventory Reform Act of 1998 (FAIR Act) and Office of Management and Budget Circular A-76. RD's Decision at 2. Specifically, each POV executes a contract with the Agency, which specifies that the POV performs the video editing services "as an independent contractor, not as an agent or employee of the Government[.]" Agency's Statement of Position to RD, Ex. D (Contract), Article I, § B(1). The POVs are responsible for the management and administration of the video editing services they provide, and, as such, are free from the direction or control of any federal employee. RD's Decision at 2. Their work is subject to the general direction of the Agency's Office of Contracts, which has authority to inspect, accept, or reject the work performed. Id. The POVs are not paid under any federal civil service pay system and, instead, are required to submit a detailed invoice for all work completed and accepted by the Agency. Id. The Agency does not withhold any taxes, Social Security, or Medicare from the invoice payments made to the POVs. The POVs do not take an oath of office or receive any standard forms, such as an SF-50 or SF-52, signifying appointment in the federal service. Further, the POVs do not receive or participate in any of the benefits offered to federal employees, such as health insurance, flexible spending accounts, leave, life insurance, long-term care insurance, retirement programs, training, or transit subsidies. Id. at 3.
[ v63 p43 ] Before the RD, the Agency claimed that the POVs are not federal employees within the meaning of § 7103(a)(2)(A) of the Statute and 5 U.S.C. § 2105(a). [n3] Although the Union conceded that the POVs are not federal employees within the meaning of § 2105(a), it claimed that § 2105(a) is not dispositive of federal employee status under the Statute. Id. In this regard, the Union claimed that § 7103(a)(2)(A) only requires that employees be "employed in an agency," and does not require that employees be appointed in the civil service in order to be covered by the Statute. Id. Accordingly, the Union argued that, as the POVs are "employed by an agency," they are covered by the Statute and an election should be directed. Id.
B. RD's Decision
Initially, the RD recognized that the Statute sets forth certain rights and obligations of "employees of the Federal Government," including the right of federal employees "in the civil service" to organize and bargain collectively under §§ 7101 and 7102 of the Statute. RD's Decision at 3 (quoting 5 U.S.C. § 7101). As a threshold requirement, the RD stated that a proposed unit for exclusive recognition must consist of federal employees covered by the Statute. According to the RD, if the proposed unit is comprised of individuals who are not considered employees under the Statute, then there is no basis for further proceedings and the petition must be dismissed. Id. (citing United States Dep't of Labor, 32 FLRA 622, 625 (1988) (Labor)).
In determining whether the POVs are employees covered by the Statute, the RD stated that an "employee" within the meaning of the Statute is an individual "employed in an agency[.]" Id. (quoting 5 U.S.C. § 7103(a)(2)(A)). The RD stated that "employee" is further defined by 5 U.S.C. § 2105(a), which provides that, "[f]or the purpose of this title," an "employee" is defined as "an individual" who is: (1) appointed in the civil service; (2) engaged in the performance of a federal function; and (3) subject to the supervision of a Government employee. Id. (quoting 5 U.S.C. § 2105(a)). According to the RD, an individual must satisfy all three elements in order to be considered a federal employee. Id. (citing Horner v. Acosta, 803 F.2d 687 (Fed. Cir. 1986); Costner v. United States, 665 F.2d 1016 (Ct. Cl. 1981); Labor, 32 FLRA at 623)).
Applying the foregoing, and noting that the Union conceded that the POVs are not federal employees within the meaning of § 2105(a), the RD determined that the POVs are not federal employees within the meaning of § 7103 and § 2105(a) because they are independent private contractors. Id. at 4. In so finding, the RD specifically rejected the Union's argument that that the requirements of § 2105(a) are not applicable to a determination of federal employee status under the Statute. In this regard, the RD found that the Authority has specifically held that the definition of "employee" under the Statute includes the requirements set forth in 5 U.S.C. § 2105(a). Id. (citing Labor, 32 FLRA at 626-27). The RD also acknowledged, and rejected, the Union's argument that § 2105(a) does not apply when the definition of "employee" has been "specifically modified," as well as the Union's assertion that the Statute presents such a modification. In this respect, the RD found that "there is nothing in the Statute that modifies or eliminates the requirements of [§] 2105 for [f]ederal employee status under the Statute." Id. (citations omitted).
In sum, the RD found that the Statute "only applies to employees of the [f]ederal government in the civil service as defined by [§] 7103(a)(2)(A) of the Statute and 5 U.S.C. § 2105(a) and does not apply to independent private contractors such as the POVs." Id.
III. Union's Application for Review
The Union requests review of the RD's decision on the grounds that the RD failed to apply established law, the decision raises an issue for which there is an absence of precedent, and the RD failed to perform a [ v63 p44 ] factual inquiry or hearing regarding representation issues. Application for Review at 2.
With respect to its claim that the RD failed to apply established law, the Union contends that the RD improperly applied both 5 U.S.C. §§ 2105 and 7103 in determining whether the POVs are "employees" under the Statute. In this regard, the Union argues that § 7103(a)(2)(A) is the only requirement that must be satisfied in order for an individual to be considered an employee under the Statute. With respect to § 2105(a), the Union claims that, although that provision applies when determining whether employees should receive benefits or credit for civil service, it does not apply when determining whether an individual has the right to form, join, or assist any labor organization under the Statute. Id. at 2-3. The Union further contends that, because § 7103 could have explicitly provided that the definition in § 2105 be used to define "employee," but did not, the term should be defined by the language in § 7103 only. In this regard, the Union reasons that the omission of any language requiring that the definition in § 2105 be used to define "employee," triggers the exception in § 2105, which provides that the § 2105 definition of "employee" applies, "except . . . when specifically modified." Id. at 4-5 (citing 5 U.S.C. § 2105). Claiming that § 7103(a) constitutes such a modification, the Union asserts that "the definition provided in § 7103 should alone be utilized." Id. at 5.
In addition, the Union contends that a contract employee of an agency can be found to be an employee of that agency. See id. at 4 (citing Watts v. OPM, 814 F.2d 1576 (Fed. Cir. 1987) (Watts)). According to the Union, under Watts, the POVs' status as contract employees does not necessarily indicate that they are not "employees" under the Statute.
Further, the Union argues that the RD misapplied Labor, 32 FLRA 622, in finding that the POVs in this case are not federal employees. In this regard, the Union asserts that Labor is inapplicable because the employer in Labor was not an "agency" within the meaning of § 7103(a)(3) of the Statute, but was a separate employer responsible for controlling the contract employees' work and compensation. By contrast, the Union asserts that, here, the Agency pays the POVs directly, assigns work to the POVs, sets deadlines, monitors and inspects the POVS' work, and requires that the work be performed at the Agency's headquarters. Application for Review at 5. According to the Union, "[t]he present situation has not been properly addressed, and there is no direct precedent[.]" Id. at 5-6. As such, the Union requests that a hearing be held to determine whether the POVs are "employees" under the Statute.
IV. Discussion
As stated by the RD, the Statute prescribes "certain rights and obligations" to "employees of the Federal Government" including the right "to form, join, or assist [a] labor organization[.]" 5 U.S.C. §§ 7101, 7102. As relevant here, § 7103(a)(2) of the Statute provides that, "[f]or the purpose of this chapter . . . `employee' means an individual . . . employed in an agency[.]"
As set forth below, there is Authority precedent to support the Union's contention that § 7103(a)(2)(A) alone should be used to determine whether the POVs are employees under the Statute. See, e.g., Long Beach Veterans Admin. Med. Ctr., Long Beach, Cal., 7 FLRA 434, 441 (1981) (VA Long Beach); Fort Knox Dependent Schools, 5 FLRA 33, 37 (1981) (Fort Knox); see also Fort Bragg Schools System, Fort Bragg, N.C., 3 FLRA 619 (1980) (Fort Bragg). However, for the reasons that follow, even applying only § 7103(a)(2)(A), the Union has not demonstrated that the RD erred in concluding that the POVs are not "employees."
In VA Long Beach, the Authority held that medical interns, residents, and fellows (collectively referred to as "house staff") who were paid stipends by the agency were "employees" within the meaning of § 7103(a)(2). In making this determination, the Authority found that: an employer-employee relationship existed between the activity and the house staff; the house staff were assigned to the activity and paid stipends by the agency; the activity retained final authority to appoint the house staff; the agency compensated the house staff with "salary and fringe benefits of the sort paid to other [f]ederal employees" for the type of direct patient care that they provide; the patient care services provided by the house staff were controlled by the activity's professional services on a day-to-day basis; and the activity retained final authority to evaluate professional performance and educational achievement, and to discipline, advance, and retain these employees. VA Long Beach, 7 FLRA at 441.
In Fort Knox, the Authority held that teachers employed under personal service contracts were "employees" within the meaning of § 7103(a)(2). In making this determination, the Authority found that the contract that each teacher was required to sign specifically stated that the teacher was a federal employee and indicated that deductions would be made from the teacher's pay for contributions to the Civil Service Retirement Fund and for federal group health and life insurance plans. Fort Knox, 5 FLRA at 36-37. In addition, the Authority found that the teachers were "under [ v63 p45 ] the control" of the Army, were directed by a school board that was appointed by the base commander, were paid by the Army, and were eligible for other federal employee benefits, such as the Civil Service Retirement Fund, federal employees' group life insurance, health benefits, and severance pay. Id.
In contrast to VA Long Beach and Fort Knox, the POVs are not compensated with the "salary and fringe benefits of the sort paid to other [f]ederal employees[.]" VA Long Beach, 7 FLRA at 441. In this respect, the POVs are not paid under the federal civil service pay systems and, instead, are required to submit a detailed invoice for all work completed and accepted by the Agency. The Agency does not withhold any taxes, Social Security, or Medicare from the invoice payments made to the POVs. In addition, the POVs do not receive or participate in any of the benefits offered to federal employees, such as health insurance, flexible spending accounts, leave, life insurance, long-term care insurance, retirement programs, training, or transit subsidies. RD's Decision at 2-3.
Further, unlike the individuals in VA Long Beach and Fort Knox, the POVs are not "under the control" of the Agency. Fort Knox, 5 FLRA at 36-37. In this regard, each POV executes a contract with the Agency, which specifies that the POV performs the video editing services as a private contractor, and not as an agent or employee of the Federal Government. RD's Decision at 2. With regard to control, the contract between the Agency and the individual "Contractor[/POV]" states, in pertinent part:
(2) The Contractor[/POV] shall be responsible for its own management and administration of the work required and bears sole responsibility for complying with any and all technical, schedule or financial requirements or constraints attendant to the performance of this contract; (3) The Contractor[/POV] shall be free from direction or control by any Government employee with respect to the manner or method of its performance of the services specified; (4) Except that the Contractor[/POV] shall be obligated to comply only with such general direction of the Contracting officer or the duly Authorized Representative of the Contracting Office (AR/CO) necessary to ensure accomplishment of the contract objectives pursuant to the Government's right and obligation to inspect, accept or reject the work.
Contract, Article I § B(2)-(4). Thus, the manner in which the POVs provide their services is free from the direction or control of any federal employee, and their work is subject only to the general direction of the Agency's Office of Contracts, which has authority to inspect, accept, or reject the work performed. Id. In addition, unlike the teachers in Fort Knox, there is no dispute that the POVs' contracts specifically state that the POVs work as independent contractors and "not as . . . employee[s] of the Government." Contract, Article I § B(1) (emphasis added).
Based on the foregoing, applying only § 7103(a)(2)(A), we find that the POVs are not "employees" under the Statute. Moreover, the Union concedes that the POVs are not employees within the meaning of § 2105. Thus, even assuming that the Union is correct that only § 7103(a)(2)(A) -- and not § 2105(a) -- applies, the Union has not established that the RD erred.
With respect to the Union's reliance on Watts for the proposition that the POVs' status as contract employees does not preclude them from being "employees" of the Agency, Application at 4 (citing Watts, 814 F.2d 1576), we reject this argument. Although the Union is correct in asserting that Watts provides that "[a]n employment contract is not necessarily inconsistent with an appointment" and "the government may . . . employ a person under both forms simultaneously[,]" the court also stated that "[t]he point is that the occurrence of either one does not necessarily imply the other." Watts, 814 F.2d at 1581. As such, our findings above are not inconsistent with Watts. In this regard, as noted above, the Authority has found that individuals working under employment contracts can be found to be federal employees. See, e.g., Fort Knox, 5 FLRA 33. However, for the reasons set forth above, the POVs' are distinguishable from the individuals in Fort Knox. As such, the Union's reliance on Watts does not establish that the POVs are "employees" under § 7103 of the Statute.
With regard to the Union's remaining exceptions, as there is Authority precedent applying solely § 7103 to determine whether an individual is an "employee" within the meaning of the Statute, we deny the Union's claim that the decision raises an issue for which is an absence of precedent. See, e.g., VA Long Beach, 7 FLRA 434; Fort Knox, 5 FLRA 33; see also Fort Bragg, 3 FLRA 619. Further, as the Authority's Regulations require only that the RD "make such investigation of the petition . . . as [he or she] deems necessary[,]" we find that the RD did not err by not holding a hearing. 5 C.F.R. § 2422.30(a).
[ v63 p46 ] Based on the foregoing, we deny the application for review in its entirety.
V. Order
The application for review is denied.
Separate Opinion of Chairman Beck:
I write separately to explain my vote in this case. I agree to deny the application for review in its entirety and find that the Purchase Order Vendors are not employees under § 7103(a)(2)(A). I do so in order to avoid an unnecessary impasse in circumstances where the Authority has only two Members, consistent with other Members' actions under similar circumstances. See AFGE, Local 727, 62 FLRA 372, 374 (2008); United States Dep't of the Treasury, IRS, Small Bus./Self Employed Bus. Div., Compliance Area 6, 61 FLRA 757, 764 (2006); Dep't of Homeland Sec., Bureau of Immigration and Customs Enforcement, 60 FLRA 131, 138 (2004).
Because the Union concedes that the vendors are not employees within the meaning of § 2105(a) and we find that they are not employees under § 7103(a)(2)(A), it is not strictly necessary that we dispose of the Union's argument that § 2105(a) does not apply when determining whether an individual has the right to form, join, or assist any labor organization under the Statute. However, I note separately that the definition of employee under 5 U.S.C. § 2105(a) is an implicit element of, and predicate to, the definition in 5 U.S.C. § 7103(a)(2)(A). United States Dep't of Labor, 32 FLRA 622, 624 (1988) (Labor). That is, in order to be an "employee" who enjoys organizational rights under Title VII of the Civil Service Reform Act of 1978, one must be an employee "appointed in the civil service." 5 U.S.C. § 2105(a)(1). When the statute granting organizational rights is, by its very title, so clearly intended to apply to the civil service, it is difficult to conclude that its entitlements and protections should be extended to those -- such as the vendors in this matter -- who are not part of the civil service. I would find in this regard that Labor is properly decided and that there is no need to reexamine our precedent.
Footnote # 1 for 63 FLRA No. 15 - Authority's Decision
Chairman Beck's separate opinion is set forth at the end of this decision.
Footnote # 2 for 63 FLRA No. 15 - Authority's Decision
Section 2422.31 of the Authority's Regulations provides, in pertinent part:
(c) Review. The Authority may grant an application for review only when the application demonstrates that review is warranted on one or more of the following grounds:
(1) The decision raises an issue for which there is an absence of precedent;
(2) Established law or policy warrants reconsideration; or,
(3) There is a genuine issue over whether the Regional Director has:
(i) Failed to apply established law;
(ii) Committed a prejudicial procedural error;
(iii) Committed a clear and prejudicial error concerning a substantial factual matter.
Footnote # 3 for 63 FLRA No. 15 - Authority's Decision
5 U.S.C. § 7103(a)(2)(A) provides, in pertinent part: "For the purpose of this chapter . . . `employee' means an individual . . . employed in an agency[.]"
5 U.S.C. § 2105(a) provides, in pertinent part:
(a) For the purpose of this title, "employee", except as otherwise provided by this section or when specifically modified, means an officer and an individual who is--
(1) appointed in the civil service by one of the following acting in an official capacity--
(A) the President;
(B) a Member or Members of Congress, or the Congress;
(C) a member of a uniformed service;
(D) an individual who is an employee under this section;
(E) the head of a Government controlled corporation; or
(F) an adjutant general designated by the Secretary concerned under section 709(c) of title 32;
(2) engaged in the performance of a Federal function under authority of law or an Executive act; and
(3) subject to the supervision of an individual named by paragraph (1) of this subsection while engaged in the performance of the duties of his position.