American Federation of Government Employees, Local 3385, AFL-CIO (Union) and Federal Home Loan Bank Board, District 7, Chicago, Illinois (Agency)
[ v07 p398 ]
07:0398(58)NG
The decision of the Authority follows:
7 FLRA No. 58
AMERICAN FEDERATION OF GOVERNMENT
EMPLOYEES, AFL-CIO, LOCAL 3385
Union
and
FEDERAL HOME LOAN BANK BOARD,
DISTRICT 7, CHICAGO, ILLINOIS
Agency
Case No. 0-NG-108
DECISION AND ORDER ON NEGOTIABILITY ISSUES
THE PETITION FOR REVIEW IN THIS CASE COMES BEFORE THE FEDERAL LABOR
RELATIONS AUTHORITY (THE AUTHORITY) PURSUANT TO SECTION 7105(A)(2)(D)
AND (E) OF THE FEDERAL SERVICE LABOR-MANAGEMENT RELATIONS STATUTE (THE
STATUTE) (5 U.S.C. 7101 ET SEQ.). THE ISSUES INVOLVED ARE THE
TIMELINESS OF THE PETITION AND THE NEGOTIABILITY OF TWO UNION PROPOSALS.
THE AGENCY REQUESTS THAT THE UNION'S PETITION FOR REVIEW BE DISMISSED
AS UNTIMELY FILED, CLAIMING IT WAS FILED MORE THAN FIVE MONTHS AFTER
EXPIRATION OF THE TIME PERMITTED BY THE STATUTE. ACCORDING TO THE
RECORD THE RELEVANT FACTS ARE AS FOLLOWS: IN NEGOTIATIONS, THE AGENCY
TOOK THE POSITION THAT UNION PROPOSALS I AND II, INFRA, WERE
NONNEGOTIABLE AND SO NOTIFIED THE UNION BY LETTERS DATED JANUARY 17,
1979, AND MARCH 30, 1979. SUBSEQUENTLY, BY LETTER TO THE AGENCY DATED
MAY 15, 1979, THE UNION REQUESTED AN AGENCY ALLEGATION CONCERNING THE
DUTY TO BARGAIN ON THE MATTERS ENCOMPASSED IN THE PROPOSALS. THE AGENCY
ALLEGATION RENDERED IN RESPONSE TO THE UNION REQUEST WAS RECEIVED BY THE
UNION ON JUNE 18, 1979, AND THE UNION FILED THE INSTANT PETITION WITH
THE AUTHORITY WITHIN FIFTEEN DAYS, ON JULY 2, 1979. FOR THE FOLLOWING
REASONS, THE AUTHORITY CONCLUDES THAT THE UNION'S APPEAL WAS TIMELY
FILED.
SECTION 7117(C) OF THE STATUTE PROVIDES, IN PERTINENT PART, THAT " .
. . IF AN AGENCY INVOLVED IN COLLECTIVE BARGAINING WITH AN EXCLUSIVE
REPRESENTATIVE ALLEGES THAT THE DUTY TO BARGAIN IN GOOD FAITH DOES NOT
EXTEND TO ANY MATTER, THE EXCLUSIVE REPRESENTATIVE MAY APPEAL THE
ALLEGATION TO THE AUTHORITY . . . ON OR BEFORE THE 15TH DAY AFTER THE
DATE ON WHICH THE AGENCY FIRST MAKES THE ALLEGATION . . . ." THUS, THE
STATUTE PROVIDES THAT A UNION APPEAL IS TO BE FILED WITHIN FIFTEEN DAYS
FROM THE DATE THE AGENCY FIRST MAKES AN ALLEGATION THAT A MATTER
PROPOSED FOR BARGAINING IS NOT WITHIN THE DUTY TO BARGAIN. THE STATUTE
FAILS TO SPECIFY, HOWEVER, HOW AN AGENCY ALLEGATION OF NONNEGOTIABILITY
WHICH WOULD START THE RUNNING OF THE TIME LIMIT FOR AN APPEAL IS TO BE
DISTINGUISHED FROM STATEMENTS DESIGNED TO ELICIT DIALOGUE IN THE CONTEXT
OF ONGOING NEGOTIATIONS WHICH, THEREFORE, WOULD NOT FORECLOSE FURTHER
BARGAINING. FURTHERMORE, IT DOES NOT PROVIDE FOR DOCUMENTING THE DATE
ON WHICH SUCH AN ALLEGATION IS MADE SO AS TO PROVIDE THE MEANS OF
DETERMINING WITH REASONABLE CERTAINTY WHEN THE FIFTEEN DAY PERIOD FOR
FILING AN APPEAL WILL BEGIN TO RUN.
HENCE, PURSUANT TO ITS MANDATE UNDER SECTIONS 7105 AND 7134 OF THE
STATUTE, /1/ THE AUTHORITY ADOPTED THE FOLLOWING CLARIFYING RULE OF
PROCEDURE IN SECTION 2424.3 (5 CFR 2424.3(1981)) WHEREBY ISSUES RELATED
TO THE DUTY TO BARGAIN UNDER SECTION 7117(C) MAY BE PROCESSED AND
RESOLVED:
SEC. 2424.3 TIME LIMITS FOR FILING.
THE TIME LIMIT FOR FILING A PETITION FOR REVIEW IS FIFTEEN (15) DAYS
AFTER THE DATE THE
AGENCY'S ALLEGATION THAT THE DUTY TO BARGAIN IN GOOD FAITH DOES NOT
EXTEND TO THE MATTER
PROPOSED TO BE BARGAINED IS SERVED ON THE EXCLUSIVE REPRESENTATIVE.
THE EXCLUSIVE
REPRESENTATIVE SHALL REQUEST SUCH ALLEGATION IN WRITING AND THE
AGENCY SHALL MAKE THE
ALLEGATION IN WRITING AND SERVE A COPY ON THE EXCLUSIVE
REPRESENTATIVE . . . .
IN ESTABLISHING THE ABOVE-QUOTED RULE OF PROCEDURE TO IMPLEMENT
SECTION 7117(C) OF THE STATUTE, THE AUTHORITY HAS CARRIED OUT THE CLEAR
INTENT OF CONGRESS IN TWO FUNDAMENTAL RESPECTS. FIRST, THE RULE
FACILITATES THE EXPEDITIOUS PROCESSING OF APPEALS UNDER SECTION 7117 TO
THE EXTENT PRACTICABLE AND, FURTHER, IT FOSTERS THE AMICABLE SETTLEMENT
OF DISPUTES THROUGH COLLECTIVE BARGAINING RATHER THAN THROUGH
UTILIZATION OF THE AUTHORITY'S PROCESS.
WITH RESPECT TO THE FORMER, SECTION 7117(C)(6) OF THE STATUTE
REQUIRES THE AUTHORITY TO EXPEDITE PROCEEDINGS FOR THE RESOLUTION OF
NEGOTIABILITY ISSUES TO THE EXTENT PRACTICABLE. SECTION 2424.3 OF THE
RULES, CONSISTENT WITH THIS CONGRESSIONAL INTENT, PROVIDES A SIMPLE AND
OBJECTIVE BASIS UPON WHICH TO DETERMINE WHICH AGENCY STATEMENTS
CONSTITUTE "ALLEGATIONS" WITHIN THE MEANING OF THE STATUTE AND, FURTHER,
WHEN SUCH ALLEGATIONS ARE MADE FOR THE PURPOSE OF COMPUTING THE FIFTEEN
DAY TIME LIMIT WITHIN WHICH A UNION APPEAL MUST BE FILED. IN THIS
MANNER, THE RULE OBVIATES THE POTENTIAL FOR DELAY IN NEARLY EVERY CASE
CAUSED BY DISPUTES BETWEEN PARTIES AS TO WHETHER AND/OR WHEN AN
ALLEGATION HAS BEEN MADE. CORRELATIVELY, IT ENABLES THE AUTHORITY TO
DEVOTE ITS RESOURCES TO RESOLVING SUBSTANTIVE NEGOTIABILITY ISSUES AS TO
WHETHER PROPOSALS ARE INCONSISTENT WITH APPLICABLE LAW, RULE OR
REGULATION, RATHER THAN INVOLVING ITSELF IN RESOLVING ESSENTIALLY
FACTUAL DISPUTES.
MOREOVER, AS TO THE SETTLEMENT OF DISPUTES THROUGH COLLECTIVE
BARGAINING, CONGRESS, IN ENACTING SECTION 7101 OF THE STATUTE, EXPRESSLY
FOUND THAT COLLECTIVE BARGAINING "FACILITATES AND ENCOURAGES THE
AMICABLE SETTLEMENTS OF DISPUTES BETWEEN EMPLOYEES AND THEIR EMPLOYERS
INVOLVING CONDITIONS OF EMPLOYMENT" AND, THUS, IS IN THE PUBLIC
INTEREST. THE RULE IS CONSISTENT WITH THIS FINDING. BY PROVIDING THAT
AN AGENCY'S ALLEGATION THAT A UNION'S PROPOSAL IS NOT WITHIN THE DUTY TO
BARGAIN MUST BE MADE ONLY IN RESPONSE TO THE UNION'S REQUEST FOR AN
ALLEGATION, THE RULE ENSURES THAT A UNION WILL NOT BE DIVERTED FROM
FURTHER NEGOTIATIONS AND FORCED TO FILE AN APPEAL BEFORE IT WISHES TO DO
SO, SIMPLY TO AVOID LOSING ITS RIGHT OF APPEAL BY THE RUNNING OF THE
TIME LIMIT. RATHER, THE RULE PRESERVES THE UNION'S RIGHT UNTIL IT
REQUESTS AN ALLEGATION, THEREBY ENABLING IT FIRST TO PROPOSE
ALTERNATIVES OR TO BARGAIN OVER AGENCY COUNTERPROPOSALS AS A MEANS OF
RESOLVING THE DISPUTE WITHOUT INVOKING THIRD-PARTY INTERVENTION. THUS,
THE RULE PROMOTES THE SETTLEMENT OF DISPUTES THROUGH COLLECTIVE
BARGAINING. /2/
FOR THESE REASONS AND BASED UPON SECTION 2424.3 OF ITS RULES, THE
AUTHORITY CONCLUDES THAT THE UNREQUESTED ALLEGATIONS PROFFERED IN THIS
CASE BY THE AGENCY IN JANUARY DID NOT START THE RUNNING OF THE TIME
LIMIT FOR THE UNOIN'S FILING OF THE INSTANT APPEAL. RATHER, THE TIME
LIMIT BEGAN TO RUN ONLY WHEN THE AGENCY RESPONDED TO THE UNION'S REQUEST
FOR AN ALLEGATION AND, WITH RESPECT TO THAT RESPONSE, THE UNION'S APPEAL
WAS FILED WITHIN THE PRESCRIBED 15-DAY PERIOD. THEREFORE, THE AGENCY'S
REQUEST TO DISMISS THE INSTANT PETITION AS UNTIMELY FILED IS DENIED.
UNION PROPOSAL I
ARTICLE XIV -- OFFICIAL PERSONNEL FOLDERS AND PERFORMANCE STANDARDS
SECTION 5 -- NO UNIT MEMBER WILL BE REQUIRED TO RATE, EVALUATE, OR
GRADE PERFORMANCE
ACHIEVEMENT LEVELS OF ANOTHER UNIT MEMBER.
QUESTION BEFORE THE AUTHORITY
THE QUESTION IS WHETHER UNION PROPOSAL I IS OUTSIDE THE DUTY TO
BARGAIN BECAUSE IT IS INCONSISTENT WITH SECTION 7106 OF THE STATUTE, AS
ALLEGED BY THE AGENCY.
OPINION
CONCLUSION AND ORDER: UNION PROPOSAL I IS OUTSIDE THE DUTY TO
BARGAIN BECAUSE IT IS INCONSISTENT WITH MANAGEMENT'S RIGHT TO ASSIGN
WORK PURSUANT TO SECTION 7106 OF THE STATUTE. ACCORDINGLY, PURSUANT TO
SECTION 2424.10 OF THE AUTHORITY'S RULES AND REGULATIONS (5 CFR 2424.10
(1981)), IT IS ORDERED THAT THE PETITION FOR REVIEW OF THE DISPUTED
PROPOSAL BE, AND IT HEREBY IS, DISMISSED.
REASONS: BASED UPON THE RECORD, THE CIRCUMSTANCES IN WHICH THE
PROPOSAL WOULD APPLY ARE AS FOLLOWS. PROFESSIONAL EMPLOYEES IN FIELD
OFFICES OF THE AGENCY ARE ASSIGNED TO CONDUCT ON-SITE EXAMINATIONS OF
SAVINGS AND LOAN ASSOCIATIONS. THE AGENCY HAS ASSIGNED
"EXAMINERS-IN-CHARGE," WHO MAY BE MEMBERS OF THE BARGAINING UNIT, THE
DUTY OF EVALUATING THE PERFORMANCE OF ASSISTING EXAMINERS WHENEVER AN
ASSIGNMENT EXCEEDS 40 HOURS. UNION PROPOSAL I, ACCORDING TO THE UNION,
SEEKS TO PROHIBIT MANAGEMENT FROM REQUIRING BARGAINING UNIT MEMBERS TO
PERFORM THE DUTIES OF RATING, EVALUATING, OR GRADING THE PERFORMANCE OF
OTHER BARGAINING UNIT MEMBERS.
SECTION 7106(A)(2)(B) OF THE STATUTE, WHICH RESERVES TO MANAGEMENT
THE RIGHT TO ASSIGN WORK, PROVIDES IN RELEVANT PART, AS FOLLOWS:
SEC. 7106. MANAGEMENT RIGHTS
(A) SUBJECT TO SUBSECTION (B) OF THIS SECTION, NOTHING IN THIS
CHAPTER SHALL AFFECT THE
AUTHORITY OF ANY MANAGEMENT OFFICIAL OF ANY AGENCY--
. . . .
(2) IN ACCORDANCE WITH APPLICABLE LAWS--
. . . .
(B) TO ASSIGN WORK, TO MAKE DETERMINATIONS WITH RESPECT TO
CONTRACTING OUT, AND TO
DETERMINE THE PERSONNEL BY WHICH AGENCY OPERATIONS SHALL BE
CONDUCTED(.)
THE EXPRESS LANGUAGE OF THE PROPOSAL HERE IN DISPUTE WOULD PROHIBIT
MANAGEMENT'S ASSIGNING CERTAIN DUTIES TO BARGAINING UNIT MEMBERS, I.E.,
RATING, EVALUATING OR GRADING THE PERFORMANCE OF OTHER UNIT EMPLOYEES.
PROPOSALS WHICH PROHIBIT MANAGEMENT FROM ASSIGNING DUTIES VIOLATE
SECTION 7106(A)(2)(B) OF THE STATUTE AND THUS ARE OUTSIDE THE DUTY TO
BARGAIN UNDER SECTION 7117(A). E.G., ASSOCIATION OF CIVILIAN
TECHNICIANS AND STATE OF GEORGIA NATIONAL GUARD, 2 FLRA 580(1980). IN
THAT CASE, THE AUTHORITY DETERMINED THAT THE UNION'S PROPOSAL, THE
EXPRESS LANGUAGE OF WHICH PROHIBITED MANAGEMENT'S ASSIGNING GROUNDS
MAINTENANCE OR OTHER NON-JOB RELATED DUTIES TO TECHNICIANS WITHOUT THEIR
CONSENT, VIOLATED SECTION 7106(A)(2)(B) OF THE STATUTE. SEE ALSO,
AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO AND AIR FORCE
LOGISTICS COMMAND, WRIGHT-PATTERSON AIR FORCE BASE, OHIO, 2 FLRA 603,
622-623, 630-632(1980) ENFORCED AS TO OTHER MATTERS SUB NOM. DEPARTMENT
OF DEFENSE V. FEDERAL LABOR RELATIONS AUTHORITY, 659 F.2D 1140 (D.C.
CIR. 1981); NATIONAL LABOR RELATIONS BOARD UNION, LOCAL 19 AND NATIONAL
LABOR RELATIONS BOARD, REGION 19, 2 FLRA 774(1980); AND INTERNATIONAL
ASSOCIATION OF FIRE FIGHTERS, LOCAL F-61 AND PHILADELPHIA NAVAL
SHIPYARD, 3 FLRA NO. 66(1980) AT 1-4.
THUS, UNION PROPOSAL I CONFLICTS WITH SECTION 7106(A)(2)(B) AND MUST
BE HELD TO BE OUTSIDE THE DUTY TO BARGAIN UNDER THE STATUTE.
UNION PROPOSAL II
ARTICLE XXIV -- EXAMINER'S RIGHTS
SECTION 2 - A UNIT EMPLOYEE SHALL NOT BE PROHIBITED FROM ACCEPTING
LOANS FROM INSTITUTIONS
WHICH ARE MEMBERS OF THE FEDERAL HOME LOAN BANK SYSTEM SO LONG AS THE
UNIT EMPLOYEE IS GRANTED
TERMS NO MORE FAVORABLE THAN WOULD BE AVAILABLE IN LIKE CIRCUMSTANCES
TO PERSONS WHO ARE NOT
EMPLOYEES OF THE AGENCY. ALL LOANS TO UNIT EMPLOYEES GRANTED BY
MEMBER INSTITUTIONS, WITH THE
EXCEPTION OF SHARE LOANS, SHALL BE FULLY DISCLOSED TO THE DISTRICT
DIRECTOR-EXAMINATIONS OR
HIS DESIGNEE AT THE TIME OF APPLICATION.
QUESTION BEFORE THE AUTHORITY
THE QUESTION IS WHETHER UNION PROPOSAL II IS OUTSIDE THE DUTY TO
BARGAIN BECAUSE, AS ALLEGED BY THE AGENCY, IT IS INCONSISTENT WITH LAW,
GOVERNMENT-WIDE RULE OR REGULATION, OR AGENCY-WIDE REGULATION FOR WHICH
A COMPELLING NEED EXISTS.
OPINION
CONCLUSION AND ORDER: UNION PROPOSAL II IS WITHIN THE DUTY TO
BARGAIN UNDER THE STATUTE SINCE IT IS NOT INCONSISTENT WITH THE STATUTE
OR OTHER FEDERAL LAW OR GOVERNMENT-WIDE RULES OR REGULATIONS, NOR IS IT
INCONSISTENT WITH AN AGENCY-WIDE REGULATION FOR WHICH A COMPELLING NEED
EXISTS. ACCORDINGLY, PURSUANT TO SECTION 2424.10 OF THE AUTHORITY'S
RULES AND REGULATIONS (5 CFR 2424.10(1981)), IT IS ORDERED THAT THE
AGENCY SHALL UPON REQUEST (OR AS OTHERWISE AGREED TO BY THE PARTIES)
BARGAIN CONCERNING UNION PROPOSAL II. /3/
REASONS: THE RECORD SHOWS THAT THE DISPUTE OVER UNION PROPOSAL II
WAS PART OF NEGOTIATIONS TO REACH A NEW AGREEMENT. THE DISPUTED
PROPOSAL IS A CARRYOVER FROM THE EXPIRED AGREEMENT AND REFLECTS THE
AGENCY'S CONFLICT OF INTEREST REGULATIONS IN EFFECT AT THE TIME THAT
AGREEMENT WAS NEGOTIATED. DURING THE COURSE OF THAT AGREEMENT, THE
AGENCY UNILATERALLY ADOPTED REVISED CONFLICT OF INTEREST REGULATIONS
WHICH, INSTEAD OF PERMITTING AN UNLIMITED NUMBER OF LOANS FROM
AGENCY-REGULATED INSTITUTIONS, RESTRICTED THE NUMBER OF SUCH LOANS WHICH
COULD BE OBTAINED BY AGENCY EMPLOYEES. IN RESPONSE TO THE UNION
PROPOSAL THAT THE SECTION FROM THE EXPIRED AGREEMENT BE INCORPORATED
INTO THE NEW AGREEMENT, THE AGENCY ADVANCES THE FOLLOWING REASONS IN
SUPPORT OF ITS CONTENTION THAT THE PROPOSAL IS NOT WITHIN THE DUTY TO
BARGAIN.
THE AGENCY STATES THAT, PURSUANT TO EXECUTIVE ORDER 11222 /4/ AND THE
OFFICE OF PERSONNEL MANAGEMENT GOVERNMENT-WIDE REGULATION WHICH
IMPLEMENTS IT, 5 CFR 735(1981), FEDERAL AGENCIES ARE REQUIRED TO
PROMULGATE REGULATIONS WHICH PRESCRIBE STANDARDS OF CONDUCT AND
RESPONSIBILITIES FOR AGENCY EMPLOYEES. THUS, THE AGENCY CONTENDS IT HAS
A LEGAL MANDATE TO ESTABLISH REGULATIONS WHICH RESTRICT FINANCIAL
TRANSACTIONS OF EMPLOYEES THAT MAY RESULT IN CONFLICT OF INTEREST
SITUATIONS AND TO DISCIPLINE EMPLOYEES WHO VIOLATE SUCH REGULATIONS. IN
FURTHERANCE OF THIS REQUIREMENT, THE AGENCY ADOPTED NEW CONFLICT OF
INTEREST REGULATIONS ON NOVEMBER 8, 1977; THEY WERE APPROVED BY OPM ON
NOVEMBER 22, 1977, AND PUBLISHED AT 12 CFR 511.735-11(1980).
ALTHOUGH 5 CFR 735(1981) REQUIRES AGENCIES TO PREPARE AND SUBMIT TO
OPM FOR APPROVAL APPROPRIATE STANDARDS OF EMPLOYEE CONDUCT, AGENCIES
HAVE DISCRETION UNDER THE REGULATION TO DEFINE AND DELINEATE SPECIFIC
STANDARDS OF CONDUCT BEFORE SUBMITTING THEM TO OPM FOR APPROVAL.
NEITHER THE CITED EXECUTIVE ORDER NOR THE REGULATION PROVIDES THAT AN
IMPLEMENTING AGENCY REGULATION CANNOT BE NEGOTIATED. MOREOVER, NEITHER
CONTAINS SPECIFIC REQUIREMENTS WITH WHICH UNION PROPOSAL II IS
INCONSISTENT. SPECIFICALLY, WHILE BOTH THE EXECUTIVE ORDER AND THE
REGULATION CITED BY THE AGENCY PRECLUDE AN EMPLOYEE FROM SOLICITING OR
ACCEPTING A LOAN FROM A PERSON WHO CONDUCTS OPERATIONS OR ACTIVITIES
THAT ARE REGULATED BY HIS AGENCY, BOTH ALLOW AGENCIES IN THEIR
DISCRETION TO GRANT EXCEPTIONS WHICH WOULD PERMIT ACCEPTANCE OF LOANS
FROM BANKS OR OTHER FINANCIAL INSTITUTIONS FOR PROPER AND USUAL
ACTIVITIES OF EMPLOYEES, SUCH AS HOME MORTGAGE LOANS. TO THE EXTENT
THAT AN AGENCY HAS DISCRETION WITH RESPECT TO A MATTER AFFECTING
CONDITIONS OF EMPLOYMENT OF ITS EMPLOYEES, THAT MATTER IS WITHIN THE
DUTY OF THE AGENCY TO BARGAIN CONSISTENT WITH LAW, RULES AND
REGULATIONS. SEE, E.G., NATIONAL TREASURY EMPLOYEES UNION, CHAPTER 6
AND INTERNAL REVENUE SERVICE, NEW ORLEANS DISTRICT;, 3 FLRA NO.
118(1980) AT 12-13 OF AUTHORITY DECISION. THUS, SINCE EXECUTIVE ORDER
11222 AND 5 CFR 635(1981) LEAVE TO THE DISCRETION OF AGENCIES THE
DEFINING OF STANDARDS INCLUDING PERMISSIBLE EXCEPTIONS AS TO THE
ACCEPTANCE OF LOANS, UNION PROPOSAL II IS NOT INCONSISTENT WITH ANY
FEDERAL LAW OR ANY GOVERNMENT-WIDE RULE OR REGULATION AND, THEREFORE, IS
NOT OUTSIDE THE DUTY TO BARGAIN ON THAT GROUND.
THE AGENCY FURTHER CONTENDS THAT THE DISPUTED PROPOSAL CONFLICTS WITH
MANAGEMENT'S RIGHT TO DISCIPLINE EMPLOYEES PURSUANT TO SECTION
7106(A)(2)(A) /5/ OF THE STATUTE. THE AGENCY STATES THAT ITS CONFLICT
OF INTEREST REGULATIONS INSTRUCT EMPLOYEES AS TO CONDUCT REQUIRED OF
THEM AND, ACCORDINGLY, SPECIFY CONDUCT FOR WHICH EMPLOYEES MAY BE
DISCIPLINED AND REMOVED. AN ESSENTIAL PART OF MANAGEMENT'S RIGHT TO
DISCIPLINE EMPLOYEES, THE AGENCY ARGUES, IS THE RIGHT TO DETERMINE
UNILATERALLY THE CONDUCT FOR WHICH EMPLOYEES WILL BE DISCIPLINED.
IN NATIONAL TREASURY EMPLOYEES UNION AND INTERNAL REVENUE SERVICE, 3
FLRA NO. 112(1980), THE AGENCY SIMILARLY ASSERTED THAT A UNION PROPOSAL
CONCERNING OUTSIDE EMPLOYMENT VIOLATED MANAGEMENT'S RIGHT UNDER SECTION
7106(A)(2)(A) TO DISCIPLINE ITS EMPLOYEES. THE AUTHORITY HELD THE
PROPOSAL WOULD NOT RESTRICT THAT AGENCY'S RIGHT TO DISCIPLINE. THE
AUTHORITY FOUND THAT NEITHER THE LANGUAGE NOR THE STATED INTENT OF THE
PROPOSAL WOULD PREVENT MANAGEMENT FROM DISCIPLINING AN EMPLOYEE WHO
FAILED UPON DIRECTION TO DISCONTINUE OUTSIDE EMPLOYMENT.
LIKEWISE, IN THE INSTANT CASE, NEITHER THE LANGUAGE NOR THE STATED
INTENT OF THE DISPUTED PROPOSAL WOULD PRECLUDE THE AGENCY'S RIGHT TO
DISCIPLINE A UNIT EMPLOYEE WHO TOOK ACTION INCONSISTENT WITH ITS TERMS.
IN THIS CONNECTION, IT SHOULD BE NOTED THAT THE PROPOSED LANGUAGE
APPEARED IN THE AGREEMENT BETWEEN THE PARTIES FROM 1973 THROUGH 1978
WITHOUT, INSOFAR AS APPEARS IN THE RECORD, ANY RESTRICTION OF THE
AGENCY'S RIGHT OR ABILITY TO DISCIPLINE EMPLOYEES. ACCORDINGLY, THE
AGENCY'S CLAIM THAT THE DISPUTED PROPOSAL VIOLATES MANAGEMENT'S RIGHT TO
DISCIPLINE EMPLOYEES CANNOT BE SUSTAINED, AND THE ALLEGATION TO THAT
EFFECT IS SET ASIDE.
THE AGENCY FURTHER CONTENDS THAT UNION PROPOSAL II IS NOT WITHIN THE
DUTY TO BARGAIN BECAUSE IT IS INCONSISTENT WITH AN AGENCY-WIDE
REGULATION FOR WHICH A COMPELLING NEED EXISTS. AS NOTED ABOVE, DURING
THE TERM OF THE PRIOR AGREEMENT THE AGENCY ADOPTED AN AGENCY-WIDE
REGULATION (12 CFR 511.735-11(1980)) WHICH LIMITS EMPLOYEE ACCEPTANCE OF
LOANS FROM AGENCY-REGULATED INSTITUTIONS.
SECTION 2424.11(A) OF THE AUTHORITY'S RULES AND REGULATIONS, THE
CRITERION UPON WHICH THE AGENCY ESSENTIALLY RELIES IN ALLEGING THAT ITS
REGULATION IS SUPPORTED BY A COMPELLING NEED, REQUIRES THE AGENCY TO
SHOW THAT ITS RULE OR REGULATION IS "ESSENTIAL, AS DISTINGUISHED FROM
HELPFUL OR DESIRABLE, TO THE ACCOMPLISHMENT OF THE MISSION . . . OF THE
AGENCY" IN ORDER TO DEMONSTRATE THAT A COMPELLING NEED FOR IT EXISTS.
/6/ AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO, LOCAL 1928 AND
DEPARTMENT OF THE NAVY, NAVAL AIR DEVELOPMENT CENTER, WARMINSTER,
PENNSYLVANIA, 2 FLRA 450(1980).
THE AGENCY ARGUES THAT ITS CONFLICT OF INTEREST REGULATION IS
ESSENTIAL TO THE ACCOMPLISHMENT OF THE AGENCY'S MISSION AND IS AN
ESSENTIAL ADJUNCT TO THE EFFECTUATION OF THE PUBLIC INTEREST. ITS
MISSION, THE AGENCY STATES, IS TO DISCHARGE ITS REGULATORY
RESPONSIBILITIES OVER THE SAVINGS AND LOAN INDUSTRY IN SUCH A WAY THAT
EVERY CITIZEN WILL HAVE COMPLETE CONFIDENCE IN THE INTEGRITY OF THE
AGENCY'S OPERATIONS. THE AGENCY CONTENDS THAT IT IS NECESSARY TO
MAINTAIN UNUSUALLY HIGH STANDARDS OF HONESTY, INTEGRITY, AND
IMPARTIALITY IN ORDER TO MAINTAIN THAT PUBLIC CONFIDENCE IN THE AGENCY'S
OPERATIONS WHICH IS NECESSARY TO THE SUCCESS OF THE AGENCY'S MISSION.
THE UNION ARGUES THAT THE AGENCY HAS NOT MET ITS BURDEN OF DEMONSTRATING
COMPELLING NEED, SINCE THE AGENCY WAS ABLE TO ACCOMPLISH ITS MISSION
UNDER ITS PRIOR REGULATION (THE LANGUAGE OF WHICH IS REFLECTED IN THE
UNION'S PROPOSAL) AND THAT, ACCORDINGLY, THE PRESENT CONFLICT OF
INTEREST REGULATION CANNOT BE DEEMED "ESSENTIAL" TO THE AGENCY'S
MISSION.
THE AGENCY HAS NOT ARGUED, NOR DOES IT APPEAR FROM THE RECORD, THAT
THE AGENCY WAS UNABLE TO ACCOMPLISH ITS MISSION UNDER THE PRIOR
REGULATION WHICH WAS IN EFFECT AT LEAST FROM 1973 UNTIL THE ADOPTION OF
THE NEW REGULATION IN 1977 AND DURING ALL OF WHICH TIME EXECUTIVE ORDER
11222 AND 5 CFR 735(1981) WERE IN EFFECT. THEREFORE, THE AGENCY HAS NOT
MET ITS BURDEN OF DEMONSTRATING THAT THIS REGULATION IS ESSENTIAL, AS
DISTINGUISHED FROM HELPFUL OR DESIRABLE, TO THE ACCOMPLISHMENT OF THE
MISSION OF THE AGENCY. ACCORDINGLY, THE AGENCY HAS NOT DEMONSTRATED
UNDER THE REQUIREMENTS SET FORTH IN THE AUTHORITY'S RULES AND
REGULATIONS THAT A COMPELLING NEED EXISTS FOR ITS CONFLICT OF INTEREST
REGULATION AND ITS CLAIM THAT THE REGULATION IS A BAR TO NEGOTIATIONS ON
UNION PROPOSAL II CANNOT BE SUSTAINED.
ISSUED, WASHINGTON, D.C., DECEMBER 18, 1981
RONALD W. HAUGHTON, CHAIRMAN
HENRY B. FRAZIER III, MEMBER
LEON B. APPLEWHAITE, MEMBER
FEDERAL LABOR RELATIONS AUTHORITY
--------------- FOOTNOTES: ---------------
/1/ SECTION 7105(A)(2)(E) OF THE STATUTE PROVIDES IN RELEVANT PART,
AS FOLLOWS:
SEC. 7105. POWERS AND DUTIES OF THE AUTHORITY
. . . .
(A)(2) THE AUTHORITY SHALL, TO THE EXTENT PROVIDED IN THIS CHAPTER
AND IN ACCORDANCE WITH REGULATIONS PRESCRIBED BY THE AUTHORITY--
. . . .
(E) RESOLVES ISSUES RELATING TO THE DUTY TO BARGAIN IN GOOD FAITH
UNDER SECTION 7117(C) OF
THIS TITLE(.)
AND SECTION 7134 OF THE STATUTE PROVIDES AS FOLLOWS:
SEC. 7134. REGULATIONS
THE AUTHORITY, THE GENERAL COUNSEL, THE FEDERAL MEDIATION AND
CONCILIATION SERVICE, THE
ASSISTANT SECRETARY OF LABOR FOR MANAGEMENT RELATIONS, AND THE PANEL
SHALL EACH PRESCRIBE
RULES AND REGULATIONS TO CARRY OUT THE PROVISIONS OF THIS CHAPTER
APPLICABLE TO EACH OF THEM,
RESPECTIVELY. PROVISIONS OF SUBCHAPTER II OF CHAPTER 5 OF THIS TITLE
SHALL BE APPLICABLE TO
THE ISSUANCE, REVISION, OR REPEAL OF ANY SUCH RULE OR REGULATION.
/2/ ADDITIONAL PRACTICAL BENEFITS ALSO FLOW FROM THE RULE. AS A
CONSEQUENCE OF ALLOWING UNIONS SOME CONTROL OVER WHEN THE TIME LIMIT FOR
FILING AN APPEAL WILL START TO RUN, THE RULE TENDS TO INHIBIT THE
UNNECESSARY ENLARGEMENT OF THE AUTHORITY'S DOCKET WITH CASES FILED ONLY
TENTATIVELY FOR THE PURPOSE OF PRESERVING A RIGHT OF APPEAL.
FURTHERMORE, THE RULE MITIGATES AGAINST THE PROLIFERATION OF APPEALS BY
GIVING A UNION THE OPPORTUNITY TO CONSOLIDATE SOME OR ALL OF THE VARIOUS
DISPUTES ARISING IN THE SAME NEGOTIATIONS INSTEAD OF BEING FORCED TO
FILE A SEPARATE APPEAL WITH RESPECT TO EACH INDIVIDUAL DISPUTE. THUS,
IT FOSTERS MORE ECONOMICAL OPERATIONS BOTH FOR THE GOVERNMENT AND THE
UNIONS SIMPLY BY PROVIDING THE OPPORTUNITY FOR A SUBSTANTIAL REDUCTION
IN THE AMOUNT OF PAPERWORK NECESSARY FOR PARTIES TO PRESERVE THEIR
RIGHTS UNDER THE STATUTE.
/3/ IN SO DECIDING THAT THE DISPUTED PROPOSAL IS WITH THE DUTY TO
BARGAIN, THE AUTHORITY, OF COURSE, MAKES NO JUDGMENT AS TO THE MERITS OF
THE PROPOSAL.
/4/ EXECUTIVE ORDER 11222 PROVIDES IN RELEVANT PART:
SECTION 201. (A) EXCEPT IN ACCORDANCE WITH REGULATIONS ISSUED
PURSUANT TO SUBSECTION (B)
OF THIS SECTION, NO EMPLOYEE SHALL SOLICIT OR ACCEPT, DIRECTLY OR
INDIRECTLY, ANY GIFT,
GRATUITY, FAVOR, ENTERTAINMENT, LOAN, OR ANY OTHER THING OF MONETARY
VALUE, FROM ANY PERSON,
CORPORATION, OR GROUP WHICH--
. . . .
(2) CONDUCTS OPERATIONS OR ACTIVITIES WHICH ARE REGULATED BY HIS
AGENCY(.)
(B) AGENCY HEADS ARE AUTHORIZED TO ISSUE REGULATIONS, COORDINATED AND
APPROVED BY THE CIVIL
SERVICE COMMISSION, IMPLEMENTING THE PROVISIONS OF SUBSECTION (A) OF
THIS SECTION AND TO
PROVIDE FOR SUCH EXCEPTIONS THEREIN AS MAY BE NECESSARY AND
APPROPRIATE IN VIEW OF THE NATURE
OF THIER AGENCY'S WORK AND THE DUTIES AND RESPONSIBILITIES OF THEIR
EMPLOYEES. FOR EXAMPLE,
IT MAY BE APPROPRIATE TO PROVIDE EXCEPTIONS . . .
(3) PERMITTING ACCEPTANCE OF LOANS FROM BANKS OR OTHER FINANCIAL
INSTITUTIONS ON CUSTOMARY
TERMS TO FINANCE PROPER AND USUAL ACTIVITIES OF EMPLOYEES, SUCH AS
HOME MORTGAGE LOANS(.)
THE RELEVANT PORTIONS OF 5 CFR 735(1981) DUPLICATE THE ABOVE PORTIONS
OF EXECUTIVE ORDER 11222.
/5/ SECTION 7106(A)(2)(A) OF THE STATUTE, WHICH RESERVES TO
MANAGEMENT THE RIGHT TO DISCIPLINE EMPLOYEES, PROVIDES IN RELEVANT PART
AS FOLLOWS:
SEC. 7106. MANAGEMENT RIGHTS
(A) SUBJECT TO SUBSECTION (B) OF THIS SECTION, NOTHING IN THIS
CHAPTER SHALL AFFECT THE
AUTHORITY OF ANY MANAGEMENT OFFICIAL OF ANY AGENCY--
. . . .
(2) IN ACCORDANCE WITH APPLICABLE LAWS--
(A) TO HIRE, ASSIGN, DIRECT, LAYOFF, AND RETAIN EMPLOYEES IN THE
AGENCY, OR TO SUSPEND,
REMOVE, REDUCE IN GRADE OR PAY, OR TAKE OTHER DISCIPLINARY ACTION
AGAINST SUCH EMPLOYEES(.)
/6/ THE AGENCY APPEARS TO BASE ITS POSITION ON CRITERIA FOR
COMPELLING NEED (A) AND (E) OF SECTION 2424.11 OF THE AUTHORITY'S
INTERIM RULES (44 FR 44766 (1979)). IN ITS FINAL RULES, HOWEVER, THE
AUTHORITY DETERMINED THAT (E) WAS SUBSUMED IN THE EXPANDED CRITERION
(A). 45 FR 3485. SECTION 2424.11 OF THE AUTHORITY'S RULES AND
REGULATIONS (5 CFR 2424.11(1981)) PROVIDES THE CRITERIA FOR DETERMINING
COMPELLING NEED FOR AGENCY RULES AND REGULATIONS IN PERTINENT PART, AS
FOLLOWS:
SEC. 2424.11 ILLUSTRATIVE CRITERIA.
A COMPELLING NEED EXISTS FOR AN AGENCY RULE OR REGULATION CONCERNING
ANY CONDITION OF
EMPLOYMENT WHEN THE AGENCY DEMONSTRATES THAT THE RULE OR REGULATION
MEETS ONE OR MORE OF THE
FOLLOWING ILLUSTRATIVE CRITERIA:
(A) THE RULE OR REGULATION IS ESSENTIAL, AS DISTINGUISHED FROM
HELPFUL OR DESIRABLE, TO THE
ACCOMPLISHMENT OF THE MISSION OR THE EXECUTION OF FUNCTIONS OF THE
AGENCY OR PRIMARY NATIONAL
SUBDIVISION IN A MANNER WHICH IS CONSISTENT WITH THE REQUIREMENTS OF
AN EFFECTIVE AND
EFFICIENT GOVERNMENT.