NATIONAL SCIENCE FOUNDATION ARLINGTON, VIRGINIA and LOCAL 3403, AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO
In the Matter of
NATIONAL SCIENCE FOUNDATION
Case No. 99 FSIP 113
LOCAL 3403, AMERICAN FEDERATION
OF GOVERNMENT EMPLOYEES, AFL-CIO
ARBITRATOR'S OPINION AND DECISION
Local 4303, American Federation of Government Employees, AFL-CIO (hereafter "Union") filed a request for assistance in a dispute arising out of negotiations with the National Science Foundation (hereafter "NSF" or "Employer") over changes to the Employer's transit subsidy program. After due consideration of the request the Federal Service Impasses Panel (hereafter "Panel") determined that the impasse should be resolved through a mediation-arbitration process before the undersigned.
A mediation-arbitration hearing was held on October 5, 1999, at the Panel's offices. Despite substantial efforts made during mediation, the parties were unable to reach agreement on the outstanding issues. As Arbitrator, the undersigned then provided the parties a full opportunity to submit evidence and arguments in support of their proposals. Both parties expressed satisfaction with the state of the record at the end of the hearing and declined to submit post-hearing final proposals or arguments.
The NSF promotes and advances scientific and engineering progress and science education in the United States, primarily by competitively awarding grants to colleges, universities, and other research and/or education organizations, for research and education in the sciences, engineering, and mathematics. The Union represents a bargaining unit of approximately 808 employees, 585 of whom are under the General Schedule (GS) in pay grades GS-4 to -15 and 223 Administratively Determined Status (AD) employees; all of them are affected by the dispute. The parties are covered by a collective-bargaining agreement (CBA) now due to expire in August 2000.
A transit subsidy program was instituted at NSF in 1994 at the time of the Employer's move from downtown Washington, D.C., to the Virginia suburbs, in major part to ease the impact of the move on lower paid employees and to induce support personnel to remain with the agency. Both parties embrace the virtues of the transit subsidy program, sharing a perception that it has enhanced employee morale and served as a retention and hiring incentive.
As to whether the program has achieved the statutory goal of causing a switch to mass transit from private automobile use, there is no data since no studies were done to determine how the program affected commuting behavior. The Union cites general studies, including figures from the Washington Metropolitan Area Transit Authority, to support its argument that the use of public transportation is increased by such programs. It also relies on a Employee Commuting Survey of all NSF employees performed last winter at its request by Arlington Transportation Partners, a private concern, in which a sizable number of those responding indicated they might switch to transit or van pool if a transit subsidy was available.
The dispute here is not over whether to retain a transit subsidy program, but rather how much to increase, and whether to expand, the program. Since 1994 the program has remained the same –-employees at GS-10 and below (and equivalents) who meet program requirements are eligible for $21.00 a month. The approximate number of employees currently participating is 222 unit and 65 non-unit employees. Both parties propose a large increase in the amount of the subsidy; the Union also seeks to increase the scope of the program in several aspects, as discussed below.
ISSUE AT IMPASSE
In total, there are five issues at impasse: (1) the amount of the monthly transit subsidy; (2) the pool of employees eligible to participate in the program; (3) the distribution procedure; (4) the certification statement that all participating employees must sign; and (5) institution of a pre-tax payroll deduction plan authorized under the Transportation Equity Act for the 21st Century, 26 U.S.C. § 132(f)(4)(1998).
1. Transit Subsidy Amount
a. The Union's Position
The Union's proposal calls for a subsidy amount set at the maximum level allowed by law, $65 per month. The Union's proposal calls for phasing in the increase over calendar year 1999, with the maximum (in terms of amount and scope) being reached in January 2000. Given where we are on the calendar, the Union agrees that these phase-in proposals have become irrelevant.
The Union supports its proposals by asserting first, that the NSF is a rich agency that has not suffered budget cutbacks like other elements of the Federal government and has spent large amounts from the Salaries and Expenses portion of its budget on such things as remodeling and Senior Executive Service bonuses. It points to broadly fluctuating amounts in various overhead categories as indicating wide latitude on the part of management to reprogram funds in this account. Also, while acknowledging that money earmarked by Congress for direct program costs (e.g., grants) makes up 95 percent of the NSF budget, it argues that the Employer has flexibility to charge certain expenses like travel to programs and not overhead, thereby freeing up money in the latter account. The Union maintains that there are major areas within NSF where cost savings could be made as reported by the Inspector General, and these would more than pay the cost of a full subsidy program.
The second leg of the Union's argument is that surveys of other Federal agencies reflect that while the Federal agency average for transit subsidies is $39, several agencies in the NSF's immediate locale provide the maximum amount, including the Central Intelligence Agency, with 4,000 employees. The Union's view is that NSF can afford to be, and ought to be, a leader in this area.
b. The Employer's Position
The Employer proposes to raise the transit subsidy from $21.00 to $41.00 per month. This was the amount originally offered and according to the Employer is based on both ability to pay, and on its research of prevailing practices by other Federal agencies, where $39 is the average. It considers its position very generous, being a doubling of the current amount.
The Employer maintains that the Union's proposal is wildly out of line with its ability to pay, that every large expenditure pointed to by the Union was necessary, and that there is very little "give" in the Central Support part of the Salaries and Expenses budget with 90 percent committed to fixed costs like rent (and with rent having increased dramatically). In evaluating the cost of the Union's proposal it has included the cost of providing the increased subsidy to non-bargaining unit employees since, as a matter of policy, it intends to extend to this group whatever subsidy is afforded to the bargaining unit.
At the start of the program, the Employer budgeted $100,000 for transit subsidies, but based on actual expenditures has funded the program at $80,000 - $85,000 per year. Early in these negotiations the Employer indicated that it could allocate an additional $80,000 for the program, reaching a total of $160,000, which it says is just enough to pay for a $41 transit subsidy for currently eligible employees. If one does the calculation using the Employer's figure for current participation offered at the hearing (270), a $41 subsidy will cost the agency only $133,000 but the Employer is making an assumption that more staff will be induced to participate by the higher subsidy amount.
The Arbitrator has considered the Employer's evidence concerning ability to pay and, in particular, its presentation concerning the small proportion of NSF's budget that is allocated to the "Central Support" category. The Arbitrator is nevertheless not persuaded that the Employer cannot afford to double the program it has put on the table. Though this appears to be a very substantial increase, it is important to note the very modest level where the program began and the absence of any increase or expansion of the program in intervening years.
The Arbitrator orders adoption of a transit subsidy amount of $42 which she believes is fair and prudent. Doubling the amount puts the Employer very slightly above the prevailing practice of Federal agencies. The Arbitrator believes that both the current program and the Employer's proposal are below the average when the pool of eligibles is taken into account, and that the record does not justify an award at that level. Since in this Award the Arbitrator is also ordering that the scope of the program be extended to all bargaining-unit employees and that a payroll tax program be implemented on or after January 1, 2001, all economic impacts have been considered together in arriving at this amount.
Adopting the Union's proposal to triple the current level while greatly expanding the eligibility pool gives too little weight to the Employer's budgetary constraints. The Union accepts no real limit on the Employer's ability to pay and asks the Arbitrator to look at expenditures in areas like conference facilities and remuneration for visiting scientists that invoke policy considerations that the Arbitrator cannot competently evaluate.
The language to be adopted is set forth under Issue 2 below.
2. Pool of Eligible Employees
a. The Union's Position
The Union's proposal is to expand the existing restricted pool of eligible employees (employees at grade GS-10 and under) to all eligible employees in the bargaining unit. Its view is that other agencies cover all employees, that expanding the eligible pool will increase transit and van pool use, and that NSF can afford transit subsidies for this larger group.
b. The Employer's Position
The Employer proposes to keep the existing eligibility pool of employees at pay grades GS-10 and below. The Employer approaches this as a cost issue, maintaining that the increase to $41 per month that it proposes is possible only if the eligibility pool remains the same. While the Employer relied on comparability with other Federal agencies to defend its subsidy amount, its comparability data include no evidence that agencies with similar subsidy levels, or any other Federal agencies for that matter, limit the scope of the program to the degree it proposes.
Although the Employer portrays this as a cost issue, the Arbitrator believes that the appropriate starting point is the public policy. The purpose of the legislation authorizing Federal agencies to establish transit subsidy programs, the Federal Employees Clean Air Incentives Act, was to reduce reliance on automobiles because of their deleterious effect on the environment in heavily congested areas. It was not to assist lower income employees with the cost of getting to work.
This legislative purpose places the emphasis on maximizing the potential for changing commuting behavior. Despite this, the Employer has been satisfied to underspend on the program and to keep the eligibility pool limited even though the numbers of jobs at the GS-10 and under level have been declining.
It seems evident that the public policy enacted into the transit subsidy law is best served by a program that is available to a broad pool of employees. A fair inference from the lack of evidence that any other Federal program limits the eligibility pool by grade level or other comparable criteria, is that the norm is to include all employees.
The cost impact of this approach is clear. The Arbitrator has taken into consideration the impact of adding substantially more employees to the program in arriving at a transit subsidy amount. Though it cannot be known with certainty how many employees will come into the program, the Arbitrator took what appears to be the most optimistic estimate-–the Union's projection of a possible 629 participants agency-wide. Applying the bargaining unit/non-bargaining unit ratio of two-thirds to one-third, this would create a total of 420 bargaining-unit employees who might participate under this expanded program (up from the current 222). Though this is a rough estimate, it is a fair upper limit number, the Arbitrator believes.
In making its cost arguments the Employer has insisted that the Arbitrator account for the NSF's policy of extending to non-bargaining-unit employees whatever program results from collective bargaining with the Union. That may be NSF policy, but given that the Union represents only bargaining-unit employees, the terms ordered in this Award will address only the terms and conditions of bargaining-unit employees. In reality, the Employer possesses the discretion to limit the scope of transit subsidy coverage (e.g., to grades GS-10 and below or any other configuration) for staff outside of the bargaining unit in the interests of reducing cost.
Based on the above, the Arbitrator orders adoption of the following language:
Beginning January 1, 2000 NSF will pay a monthly transit subsidy of $42 to all eligible full-time bargaining-unit employees.
3. The Distribution Procedure
Currently the subsidy is disbursed bimonthly over 2 consecutive days and 1 "make up" day at specific times. The Employer has already agreed to moving to monthly distributions in response to the Union's suggestion that this will alleviate delays in people getting into the program. Remaining in dispute is the monthly disbursement schedule.
a. The Union's Position
Under the Union's proposal, employees would pick up the subsidy over 3 non-consecutive days between 8:30 a.m. and 1 p.m. and on a minimum of 1 "make up" day between 9 a.m. and 12 noon, with employees absent on those days able to schedule an appointment for pick up.
The Union argues that the Employer's approach fails to consider employees who are away on week-long agency business trips, or who are out ill or on leave, who could thereby entirely miss a pick-up opportunity. The Union also maintains that the office that administers the program is in practice quite flexible and that this practice is reflected in the Union's proposal.
b. The Employer's Position
The Employer would have employees pick up the subsidy over 2 consecutive days and 1 specific "make up" day between the hours of 8:15 a.m. and 12:30 p.m. and 1:30 and 3 p.m., which is the same schedule currently used for bimonthly distributions. It opposes any provision for absentee pickups. Its concern is reducing the burden on the office that administers the transit subsidy program.
Testimony from the head of the administering office made clear that the Employer has allowed people missing the pick-up days to get their Metrochecks if they come and ask for them. Because this flexibility has never been announced, there is essentially one group of employees that regularly takes advantage of the office's goodwill. Hearing this, the Union observed that the rule-abiding employees have taken the schedule at face value, and waited the lengthy period until the next scheduled distribution days.
The Employer's stated reason for opposing the Union's language about late pick-up appointments is to avoid encouraging more late pickups which will further burden the administrative office.
Inquiries by the Arbitrator revealed that there is little to nothing in the way of instructions or guidance to transit subsidy users. The Employer representatives conceded this.
A persuasive case was not made that non-consecutive days are really more burdensome than consecutive days. Furthermore, the addition of more program participants suggests that another day will be needed. No alternative solutions were offered by the Employer for the dilemma of employees on extended absence for good reason and/or on agency business.
It is apparent to the Arbitrator, based on what was said during the hearing, that there is a great deal the Employer could do, through appropriate guidance, to discourage irresponsibility by the employees it has allowed to abuse the system, and to encourage respect for the needs of the administering office by everyone.
After due consideration the Arbitrator adopts the Union's proposal as follows (slightly edited):
Metrochecks will be distributed monthly on 3 non-consecutive days between 8:30 a.m. and 1 p.m., and on 1 make-up day between 9 a.m. and noon. Employees absent on these days may schedule an appointment to pick up their transit subsidy.
4. Certification Requirement
Employees receiving a transit subsidy sign a statement certifying basic eligibility requirements when they pick up their Metrocheck. This occurs on a distribution day falling in the month prior to the one in which the subsidy will be used. Currently the certification includes this statement:
I am eligible for a fare subsidy for use on participating public transportation systems and have utilized this transportation system for at least 2 weeks this month. I am obtaining this subsidy for my personal commuting use, and will not transfer it to anyone else.
When, at the start of negotiations, the Union proposed to change this portion of the certification, the Employer countered with new language. Both proposals therefore would alter the status quo.
a. The Union's Position
The Union's intent is to make the certification forward-looking by having employees certify as to their future commuting behavior rather than certifying current behavior for eligibility in the next month. The Union asserts that the latter approach, which is embodied in the current language and the Employer's proposal, forces new employees to wait until they have worked a month and used public transportation entirely at their own expense before they can gain eligibility for a subsidy. The Union regards the Employer's proposal as "punitive" and stricter than the current certification. The Union's proposed language, in relevant part, is the following:
I am eligible for a fare subsidy for use on participating public transit systems and will use such a system for commuting this month.
b. The Employer's Position
Out of concern that the Union language allows employees to use the subsidy for purposes other than commuting to work, the Employer formulated this new language for its proposal:
I certify that I am eligible for a fare subsidy for use on participating public transit systems and am using the entire fare subsidy I receive for commuting on such a system this month.
Though expressing concern with misuse of the program, the Employer cited only one such incident that dates to 1993 when a predecessor parking program was in effect.
The parties do not have different purposes here. Both understand that transit subsidies are to be used for the employee's commuting, period.
The Employer's language continues to have the employee swear to conduct in the pick-up month to establish eligibility for a subsidy in the following month. The Arbitrator does not accept that this kind of certification is required for enforceability, which is the Employer's assertion. It is noted that the certification used in the transportation subsidy program of the National Institutes for Health (NIH), included in the record, has the employee certify that "I will be using TRANSHARE fare for my daily commute to and/or from work."
Furthermore, the Employer language is unworkable, as it can be read to deprive eligibility to an employee who legitimately missed work or was on travel and for this reason cannot certify to using the entire amount of the subsidy in the pick-up month.
At the same time, the Union's language as to what the employee is agreeing to do is imprecise. The Arbitrator finds the NIH language quoted above to be a much clearer pledge to use the transit subsidy for commuting, only.
The Arbitrator will therefore order adoption of the language below for the certification statement. Paragraph two is in both parties' proposals. Paragraph three is in the current certification and the Employer's proposal. The Union never addressed its exclusion of this language. The first paragraph combines elements of the Employer proposal, the Union proposal, and the NIH language referred to above. For reasons addressed earlier in this Award, this certification refers only to bargaining-unit members.
I hereby certify that: I am a full-time employee of the National Science Foundation and a member of the bargaining unit represented by the American Federation of Government Employees, Local 3403. I do not drive singly nor walk to work on a regular basis, and am not a member of a car pool. I will be using this transit subsidy for my daily commute to and/or from work. I am obtaining this subsidy for my personal commuting use and will not transfer it to anyone else.
This certification concerns a matter within the jurisdiction of an agency of the United States and making a false, fictitious, or fraudulent certification may render me subject to criminal prosecution under Title 18, United States Code, Section 1001.
By signing this certification, I understand that this information may be released as required by law to other Federal agencies for evaluating the overall effectiveness of the program.
5. Pre-tax Payroll Deduction Plan
In the Transportation Equity Act for the 21st Century (hereafter TEA-21), 26 U.S.C. § 132(f)(4)(1998)), Congress revised the Internal Revenue Code to create an option beginning in 1999 for employers to encourage use of transit for commuting by offering employees the opportunity to direct a portion of their pre-tax salary for use in covering qualified costs of commuting. Up to $65 monthly (rising to $100 in 2002) may be designated for public transportation expenses and up to $175 for qualified parking. Employers may offer a program that contains both this pre-tax payroll plan and a direct transit subsidy, but the combined subsidy/pre-tax deduction cannot exceed the statutory maximum.
a. The Union’s Position
The Union proposes that, as soon as the NSF's new payroll system is implemented, estimated by the Employer to be in the summer of 2000, NSF fully implement the TEA-21 benefit. Its arguments are much the same as for increasing the amount and scope of the existing transit subsidy, that is, that the NSF can afford this program, that public policy supports its implementation, and that NSF ought to be a leader in implementing this legislation. The Union asserts that the only costs to the Employer, that of administration, are not prohibitive and that its understanding from technical staff is that it is feasible.
b. The Employer’s Position
The Employer essentially proposes either that the Union withdraw its proposal or that the pre-tax payroll deduction plan be substituted for the existing transit subsidy program. It argues that it will cost in the neighborhood of $180,000 to institute the new system (to program the computers) and that the administrative burden of administering two transit programs is prohibitive. The Arbitrator did not have the benefit of hearing directly from anyone with responsibility for establishing or administering the new payroll system.
Up until the time of the mediation-arbitration, the focus of the Employer's response to the Union proposal was to argue its illegality, based on its reading that the Union was proposing both a direct subsidy of $65 and a payroll deduction of $65.
It is apparent from a General Services Administration (GSA) document submitted by the Union that Federal agencies are seeking creative ways to implement TEA-21 that will not be unduly burdensome. If the Arbitrator reads it correctly, at GSA the idea is to initially disburse the pre-tax set aside each pay period in the net pay, and down the road to create direct purchase agreements with METRO and other transit organizations through which the payroll deductions will be directed. It is also apparent from a letter from area Members of Congress to the Director of the Office of Management and Budget that there has been something less than eagerness to implement TEA-21 within the Federal government.
The Arbitrator has weighed three primary considerations on this issue. First, the Employer presentation reflected little, if any, actual study having taken place on implementing TEA-21. Second, the legislation creates a strong policy to further encourage use of mass transportation by this tax saving plan and envisions the coexistence of both a direct subsidy and the pre-tax payroll deduction. Third, the pre-tax payroll deduction would offer employees a new benefit that could do more to alter employee commuting behavior by inducing a larger number of employees to use public transportation (the statutory goal). At the same time, there will be employees for whom the direct subsidy will remain a preferable approach.
Given these considerations, the Arbitrator is not receptive to taking the subject off the table by ordering the Union to withdraw its proposal, or making the TEA-21 plan a substitute for the direct subsidy. At the same time, the Arbitrator is convinced that the parties need to communicate fully and apply themselves to jointly studying the substantial implementation issues, hopefully in a non-adversarial approach.
Consequently, the Arbitrator orders adoption of the following language:
NSF will implement a TEA-21 pretax payrol