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 19 FLRA No. 91
 
 AMERICAN FEDERATION OF GOVERNMENT
 EMPLOYEES, LOCAL 32, AFL-CIO
 Union
 
 and
 
 OFFICE OF PERSONNEL MANAGEMENT
 Agency
 
                                            Case No. O-NG-1054
 
                DECISION AND ORDER ON NEGOTIABILITY ISSUES
 
    The petition for review in this case comes before the Authority
 pursuant to section 7105(a)(2)(E) of the Federal Service
 Labor-Management Relations Statute (the Statute) and raises issues
 concerning the negotiability of two Union proposals.  Upon careful
 consideration of the entire record, including the parties' contentions,
 /1/ the Authority makes the following determinations.
 
                             Union Proposal 1
 
          Article 7, Sections 9a, 9b and 9c, "An employee in steps 1
       through 3 who is outstanding will be given a quality step
       increase;  an employee in steps 4 through 10 who is outstanding
       will be given a quality step increase;  and 'Outstanding' means
       outstanding in any critical element."
 
    Union Proposal 1 prescribes the level of achievement under the
 Agency's performance appraisal system which is sufficient to entitle an
 employee to a quality step increase.  In thus establishing the criteria
 for the Agency's decision to reward employee performance, Proposal 1
 herein is to the same effect as Union Proposals 2 and 3 in American
 Federation of State, County and Municipal Employees, AFL-CIO, Locals
 2477 and 2910 and Library of Congress, 17 FLRA No. 108 (1985), which
 prescribed the levels of achievement under the agency's performance
 appraisal system sufficient to entitle an employee to an incentive award
 and which were found nonnegotiable.  In that case, the Authority,
 relying on National Treasury Employees Union and Internal Revenue
 Service, 14 FLRA 463 (1984) (Member Haughton dissenting) (Union
 Proposals 5 and 6), appeal docketed sub nom. National Treasury Employees
 Union v. Federal Labor Relations Authority, No. 84-1292 (D.C. Cir. July
 9, 1984), concluded that Proposals 2 and 3 were determinative of the
 conditions under which an incentive award was to be granted, that is,
 the attainment of a stated level of achievement or performance rating
 and that the proposals directly interfered with management's rights to
 direct employees and assign work under section 7106(a)(2)(A) and (B) of
 the Statute.  In a similar manner, Union Proposal 1 herein is
 determinative of the requirements under which the Agency will grant a
 quality step increase, that is, the attainment of a particular
 performance rating.  Therefore, for the reasons more fully set forth in
 Library of Congress, Union Proposal 1 herein directly interferes with
 management's rights, under section 7106, to direct employees and assign
 work through the establishment of rewards for employee performance and
 is outside the duty to bargain.  See also American Federation of
 Government Employees, AFL-CIO, Locals 112, 3269, 3383 and 3831 and
 Department of Health and Human Resources, Food and Drug Administration,
 Region V, 15 FLRA No. 171 (1984) (Union Proposal 2).
 
                             Union Proposal 2
 
          Article 11, Section 1, "Any employee meeting the announced
       standard for any award will be given the award.  No awards will be
       given unless objective standards are announced in advance."
 
    Union Proposal 2 would require that the Agency announce in advance
 objective standards for any award and grant any employee meeting the
 announced standard an award.  The Authority held in Internal Revenue
 Service, 14 FLRA at 470, that management's exercise of its rights to
 assign work and direct employees, pursuant to section 7106(a)(2)(A) and
 (B) of the Statute, includes the establishment of an awards system and
 that "the circumstances under which an incentive may be awarded are
 essential components of management's judgment." Inasmuch as both
 requirements in Union Proposal 2, the announcement of standards and the
 obligation to reward all employees meeting that standard, are aspects of
 an award system, the Authority concludes that, based on Internal Revenue
 Service, Union Proposal 2 is outside the duty to bargain.
 
    Accordingly, pursuant to section 2424.10 of the Authority's Rules and
 Regulations, IT IS ORDERED that the Union's petition for review be, and
 it hereby is, dismissed.  Issued, Washington, D.C., August 15, 1985
                                       Henry B. Frazier III, Acting
                                       Chairman
                                       William J. McGinnis, Jr., Member
                                       FEDERAL LABOR RELATIONS AUTHORITY
 
 
 
 
 
 
 --------------- FOOTNOTES$ ---------------
 
 
    /1/ The Union did not file a Reply Brief in this case. 
 
 
 

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