U.S. Federal Labor Relations Authority

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In the Matter of









Case No. 95 FSIP 120






        Local 3448, 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 between it and the Social Security Administration, Cincinnati District Office and Teleservice Center, Cincinnati, Ohio (Employer) under the Federal Service Labor-Management Relations Statute (Statute), 5 U.S.C. § 7119. After investigation of the request for assistance, the Panel directed the dispute to the undersigned for mediation-arbitration by telephone. Pursuant to this procedural directive, a telephone conference was held with the parties on September 28, 1995. At the outset, mediation was used in an attempt to resolve the outstanding issue which relates to the Employer’s payment of fees for the use of a fitness center. When no resolution occurred during the initial session, the proceeding was continued, and four follow-up telephone conference mediation sessions were held during October and November 1995, in order to provide ample opportunity for the parties to gather information and reach a mediated agreement. The Arbitrator also spoke with the manager of the fitness center in an effort to assist the parties in ascertaining the breakdown of costs which the Employer wanted. When the parties were unable to reach agreement, she had them prepare final arguments with their final offers and the matter was arbitrated as ordered by the Panel. The record is now closed, and she has considered all of the relevant information contained therein.


    The Cincinnati District Office and the Cincinnati Teleservice Center are two separate Social Security Administration(SSA) operations located in the same Federal building in downtown Cincinnati. Local 3448 represents, at the local level, approximately 120 employees of the two offices who are part of a nationwide bargaining unit of approximately 50,000 employees. The parties are covered by the master agreement between SSA and AFGE which is due to expire in November 1996.

    In September 1994, the Cincinnati Administrative Support Unit (CASU) began to accept individual memberships and the Employer told the 20 employees who were participating that it would discontinue its participation as there were individual memberships available. Hence, there was no longer a reason for the exception to SSA national policy (discussed below). Subsequently, participation declined to five employees.(1)


1. Employer’s Position

    The position of the Employer as stated in its argument is:

Unlike the Union’s proposals, Management’s proposal is consistent with the agency’s nationwide funding policy.

There is no justifiable reason for an exception to the funding policy. Employees are able to participate in the fitness center for a reasonable membership fee. The fee is comparable to those paid by employees for fitness center access in locations where SSA funds part of the costs.

Management’s proposal treats all SSA employees in a fair and equitable manner. Where SSA is a participating agency, as in the HHS run fitness center in Chicago and even the SSA run center in Baltimore, employees are still required to pay ongoing membership fees. In Cincinnati, however, if the agency were to become a participating agency, employees would not be required to pay any membership fee.

Sharing the membership fees based on an arbitrary unsubstantiated figure provided by the IRS/CASU is also insupportable. It too is inequitable to those employees nationwide who are paying their appropriate share based on fixed costs.

Management’s proposal is financially responsible. It provides for employee contributions which are essential to ensure employee commitment to regular participation in a fitness program. Without regular participation, any health benefit to employees is negligible. Reasonable employee contributions also increase the likelihood of public support for such programs.

Despite the fact that, as part of a ULP settlement agreement, employees will be reimbursed for the entire cost of membership fees incurred while the issue is before the Panel, only five SSA employees are currently participating.

In the face of an austere budget, threatened cuts to Medicare, etc., Government spending is under a microscope. SSA is subject to additional scrutiny as the manager of SSA trust fund monies. The expenditure of trust fund monies for employee benefits must be done in a fiscally responsible, accountable, and consistent manner. Expanding beyond the funding parameters already provided for based on unsupported guesses, has the potential for portraying the agency and the government in general in a wholly unfavorable light. Negative public exposure could in fact jeopardize what we currently are able to fund.

The current national agreement which expires November 17, 1996 is silent as to fitness center funding. If the union feels the national funding policy is inadequate, the appropriate vehicle for making such changes should be the national contract negotiations, not local bargaining.

2. Union’s Position

    The Union points out that the Cincinnati Health Improvement Center is a fitness center in downtown Cincinnati located in the basement of the U.S. Post Office building in the Federal complex. It is available to Federal employees. The center is administered by the CASU arm of the U.S. Internal Revenue Service (IRS); it contracts with an independent contractor to run the fitness center.

    CASU collects the fees from the Federal agencies that participate in the program. The 17 participating agencies pay a monthly fee to CASU for each employee who used the center the prior month. Once an agency becomes a participating agency and pays for one employee, all employees become eligible for the CASU’s wellness program which offers a variety of classes each month. The Employer would continue to pay fees for participating employees. At this time the Employer has again discontinued fee payment and the Union has filed a ULP.

    The Union stresses that SSA partially funds facilities in other cities and cites Chicago and Baltimore where there is a process for making co-payments. There is no process for co-payment at CASU.

    Further, it argues that the National agreement refers to wellness in Article 10, Sections 16 and 17, and that SSA encourages employee participation in Federal Fitness Day. Moreover, throughout the bargaining, the Employer’s position has been that it would like to fund a portion of the fees but the funding must be in compliance with the SSA’s 1992 policy which provides for the funding of fixed costs but not the funding of nonfixed costs. It asserts that there is no controlling Federal regulation which prevents funding of operations such as CASU, because 17 other Federal agencies including IRS and the U.S. Army Corps of Engineers participate. And, prior to CASU’s establishing individual memberships, the Employer paid for participation in 1993 and 1994 when exact expenses were also unknown. Further, as a result of the ULP settlement, the Employer reimbursed the four employees who had continued individual memberships.

    Finally, it argues the reasonableness of the Employer’s being ordered to pay the monthly costs for 20 percent of the employees because exact fee breakdown numbers remain unavailable from CASU. It supports the fairness of this approach as Cincinnati employees, under the SSA position of no payment, are treated less favorably than employees in Chicago and Boston who participate in the Fitness Program. Further, in Baltimore, the Union suggests the SSA operates the center and is, therefore, essentially paying to itself the employer portion of operations. Additionally, in Chicago, they pay a portion through their GSA rentals.

    It points out that if the Arbitrator directs the Employer to pay a portion of the fees directly to a participating employee and then the employee paid CASU through a Credit Union Account, which is the way CASU collects the individual membership fees, that the fees would likely be late and also taxable income. Therefore, the Union argues strongly that the best solution is for SSA to fully fund only a percentage of the total employees participating at the Cincinnati site. The obligation to fund 20 percent of each employee’s fee or fully to fund up to 20 percent of the total number of employees is the same financial obligation. Further, the Employer would be a participating agency and thereby all employees at the site would be allowed to attend "Wellness" activities. For these reasons, the Union urges the Arbitrator to adopt its proposal.


The Employer’s Proposal

Consistent with SSA’s "Child Care and Fitness Center Funding Policy," the Employer will continue to work with the Cincinnati CASU/Health Improvement Center to determine a breakdown of the costs of the center.

Once these costs and a signed Inter-agency Agreement are received from the Cincinnati IRS/CASU, they will be submitted to Headquarters for reimbursement consistent with SSA’s "Child Care and Fitness Center Funding Policy" and subject to the availability of funds.

The parties acknowledge that certain fitness center costs are not allowable under SSA’s Funding Policy and must be funded from fees paid by individual fitness center participants. These costs include:

1. Salaries of fitness center employees or ongoing consultant fees;

2. Classes such as aerobic exercise, smoking cessation, weight management, stress management, nutrition, and first aid;

3. The purchase of liability insurance coverage for participants, instructors and others.

4. The purchase of consumable goods and supplies after the start up period.

5. Costs not included in the approved fitness center’s annual operating budget.

6. Costs based on agency population rather than actual employee participation.

The Union’s Proposal

SSA will pay monthly fees, by becoming a participating Agency through CASU, for a limited number of bargaining-unit employees of the Cincinnati District Office and the Cincinnati Teleservice Center who wish to participate in the Cincinnati Health Improvement Center. The number of bargaining-unit members eligible to participate at a given time will not be greater than 20 percent of the staff on duty.

The parties, at the local level will meet to determine conditions of rotation if more than 20 percent of the staff wish to participate.


    The Arbitrator has carefully studied all the arguments and evidence submitted by both parties. The Arbitrator adopts the Union’s final offer for the following reasons:

    The Social Security Administration has adopted a national policy which is more restrictive and, in the instant case, creates a "catch twenty-two" where the CASU either cannot or will not give the parties specific enough figures to determine the fixed versus the nonfixed costs, and therefore says since employees can join individually, it won’t pay anything. While this Arbitrator is very conscious of working within policies, she also recognizes that policies can be constructed in order to severely limit their applicability. If she orders the adoption of the Employer’s final offer she would send the parties back to the bargaining table to bargain endlessly until they could convince CASU to provide the numbers which satisfy the SSA.

    This frustration of the bargaining process through restrictive policy is not supportable. The Congress created public policy which encourages employees’ participation in fitness programs. The Union position reaches a compromise which takes into account the SSA concern for not paying full enrollment for every agency employee. This provides a cap to the amount of fiscal commitment in this time of austere budgets and allows for budgeting of a known amount of money.

    Further, if more than 20 percent of the employees choose to participate, the Union proposal provides for the establishment of a rotation, thereby assuring all employees access and also Employer containment of costs.

    Insofar as the issue of employees’ paying their fair share, in this instance, the entire bargaining unit is essentially being used to spread the employees’ share, because at any one time 80 percent of the employees will be required to rotate and pay the full cost of the individual membership.

    Finally, the entire unit benefits from their access to the Wellness Program.


    The parties shall adopt the Union’s proposal.


Bonnie Prouty Castrey


March 2, 1996

Huntington Beach, California


1.The Union filed an unfair labor practice charge in October 1994, when the Employer refused to bargain. A complaint was issued by the FLRA General Counsel, and a hearing was scheduled for May 1995. Prior to the hearing, the parties reached an agreement to bargain, and that the Agency would retroactively pay back fees for the employees who continued to participate.