U.S. Federal Labor Relations Authority

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United States Of America




In the Matter of








Case No. 90 FSIP 184


Local 48, American Federation of Government Employees, AFL-CIO (Union), filed a request for assistance with the Federal Service Impasses Panel (Panel) to consider a negotiation impasse under section 7119 of the Federal Service Labor-Management Relations Statute (Statute) between it and the Department of the Navy, Naval Hospital Bremerton, Bremerton, Washington (Employer).

The Panel determined that the impasse should be resolved on the basis of written submissions from the parties with the Panel to take whatever action it deemed appropriate to resolve the impasse. Submissions were made pursuant to these procedures and the Panel has considered the entire record.


The Employer is responsible for providing medical services to active duty and retired military members and their dependents. There are approximately 275 professional and nonprofessional employees in 2 bargaining units at the Naval Hospital Bremerton and its 3 branch clinics, who occupy positions such as registered nurse, social worker, pharmacist, physician, and industrial hygienist.

In 1989, the Employer considered implementing a surcharge in the hospital's dining facility; however, the parties agreed that an a la carte menu would be established in order to avoid a price increase. In April 1990, the Employer notified the Union that the a la carte menu would be discontinued due to the issuance of a ruling by the Navy's Inspector General which held that the commander of a naval hospital lacks authority to waive the surcharge for civilian employees, unless the employees are involved in food preparation or directed to remain on the hospital's premises during meal periods.


The parties dispute whether bargaining-unit employees should pay a surcharge on food purchased in the hospital cafeteria.

1. The Employer's Position

The Employer proposes that all bargaining-unit employees pay such a surcharge, unless the employee is directly involved in food service preparation or directed by the Employer to remain on the hospital premises during meal periods. Subject to negotiations, lunch breaks may be extended for employees who choose not to eat in the cafeteria and would need more than 30 minutes to obtain lunch elsewhere.

The proposed surcharge is in accordance with regulations issued pursuant to 37 U.S.C. § 1011 which authorizes the Secretary of Defense to establish rates for meals sold in Government dining facilities, at a level sufficient to provide reimbursement of operating expenses and food costs.(1) According to the Employer, the hospital's dining facility is operating at a deficit and to continue waiving the surcharge would only add to it. Since the deficit currently is being covered by funds from medical operations and maintenance, a surcharge on meals would help to defray the cost of consumables and restore funds to medical operations that are critical to patient care. The Employer estimates that the average cost to prepare lunch is $4.21. Without a surcharge, the average price for lunch is $1.65; with a surcharge, it would be $3.75, still less than what it costs the Employer to prepare the meal. Moreover, even with a surcharge, the cost of meals would be reasonable when compared with prices at surrounding commercial facilities. Employees who choose not to eat in the dining facility have alternatives available to them including: (1) bringing their lunch to work and eating it in the dining facility which is equipped with microwaves and refrigerators for their use; (2) purchasing lunch from the hospital's vending machines; (3) having meals delivered to the hospital; or (4) calling in orders from outside eating establishments for pick-up.

2. The Union's Position

The Union proposes that bargaining-unit employees be exempt from paying a surcharge on meals purchased while in a duty status. In its view, the Employer has not substantiated that a compelling need exists for the regulations that direct the collection of surcharges, nor has it provided sufficient evidence justifying the extent of the deficit. The previous waiver of the surcharge has become an important condition of employment to bargaining-unit employees, particularly because the cafeteria is the only dining facility in the hospital. Furthermore, employee access to other eating establishments is limited due to their distance from the hospital and the short duration of lunch breaks. Any extension of a lunch break, as the Employer offers to negotiate, would affect patient care during lunch periods, cause conflict among employees in scheduling these breaks, and require lengthening the workday; the latter also would create other problems for employees, such as increased child care costs.


Having considered the evidence and arguments in this case, we conclude that the Employer's proposal should be adopted. In our view, a surcharge is appropriate in order to help defray the increased cost of food and operating expenses. It is reasonable to conclude that such costs have risen and that some of the expenses should be borne by employees who patronize the facility. Imposing a surcharge should help reduce the need to divert funds from patient care and other sources in order to cover the cafeteria's financial losses. On balance, we find that the need for the surcharge outweighs the benefits to employees of being provided with inexpensive food. Moreover, the record reveals that the hospital employees are mainly professionals and semi-professionals who would be able to afford an increase in the cost of food served at the cafeteria.(2)

Furthermore, we note that a number of alternatives exist for employees who choose to avoid the increase in meal prices which would result from a surcharge. Among them are, negotiating longer lunch breaks so employees may have the additional time needed to eat at facilities away from the hospital, and using the microwaves, refrigerators, and vending machines in the cafeteria should employees prefer to bring their lunch to work.


Pursuant to the authority vested in it by section 7119 of the Federal Service Labor-Management Relations Statute and because of the failure of the parties to resolve their dispute during the course of proceedings instituted under section 2471.6(a)(2) of the Panel's regulations, the Federal Service Impasses Panel under section 2471.11(a) of its regulations hereby orders the following:

The parties shall adopt the Employer's proposal.


By direction of the Panel.

Linda A. Lafferty

Executive Director

January 3, 1991

Washington, D.C.

1. Manual for the Department of Defense Food Service Program (November 1978); Naval Medical Command Instructions 10110.2 (December 6, 1988); Naval Supplemental Instruction 4061.9T (March 20, 1987).

2. Cf. Department of the Air Force. Scott Air Force Base Illinois and Local R7-23. National Association of Government Employees, Case No. 89 FSIP 24 (May 3, 1989), Panel Release No. 281, where the Panel rejected a proposal to implement a surcharge on the basis that it was a benefit on which employees relied. It reasoned that the employer's implementation of a surcharge would have affected lower earning employees who could least afford the increase; thus, the benefit to the employees outweighed the costs to the employer.