[ v21 p90 ]
21:0090(18)NG
The decision of the Authority follows:
21 FLRA No. 18
AMERICAN FEDERATION OF
GOVERNMENT EMPLOYEES,
AFL-CIO, LOCAL 3477
Union
and
COMMODITY FUTURES
TRADING COMMISSION
Agency
Case No. 0-NG-681
DECISION AND ORDER ON NEGOTIABILITY ISSUES
I. Statement of the Case
This case is before the Authority because of a negotiability appeal
filed under section 7105(a) (2) (E) of the Federal Service
Labor-Management Relations Statute (the Statute) and Presents issues
concerning the negotiability of three Union proposals.
II. Procedural Issue
The Agency contends that the Union's petition for review was untimely
filed. Contrary to the Agency's contention, the Authority finds that
the petition was timely submitted with respect to the Union's written
request for a written allegation of nonnegotiability. Under section
2424.3 of the Authority's Rules and Regulations, a union has the right
to request in writing that an agency serve it with such written
allegation. American Federation of Government Employees, AFL-CIO, Local
3355 and Federal Home Loan Bank Board, District 7, Chicago, Illinois, 7
FLRa 395 (1981).
III. Union Proposal 1
Percentage of award based on the employee's salary shall range as
follows: Annual Performance Rating Range Outstanding 10% to 15%
Superior 5% to 10%
A. Positions of the Parties
The Agency contends that the Proposal is nonnegotiable because it
conflicts with management's right to determine its budget under section
7106(a) (1) of the Statute. The Agency also argues that the proposal is
inconsistent with 5 U.S.C. 4502 and 4503.
The Union contends that the proposal is not inconsistent with
management's right to determine its budget. The Union also contends
that the proposal is not inconsistent with 5 U.S.C. 4502 and 4503.
B. Analysis
1. Management rights
Under existing Authority precedent, we find that the proposal is
nonnegotiable for reasons other than those alleged by the Agency. In
particular, Union Proposal 1 would establish a range of percentages of
salary for the purpose of determining the amount of an award given for
employee performance. Because this proposal would substantively affect
the rate of a performance-related award, it has the same effect as Union
Proposal 5 in National Treasury Employees Union and Internal Revenue
Service, 14 FLRA 463 (19B4), appeal docketed sub nom. National Treasury
Employees Union v. FLRA, No. 84-1292 (D.C. Cir. July 9, 1984). In that
case the Authority found that a Proposal which would establish the rate
of a monetary incentive for performance directly interfered with
management's rights to direct employees and to assign work under section
7106(a) (2) (A) and (B).
Because this proposal concerns awards for employee performance,
however, it is different from Union Proposals? and 3 in this case.
Performance based incentive awards relate to an employee's
accomplishment with respect to his or her job requirements. Performance
awards are, therefore, ultimately based in management's right to
determine those employee job requirements. Incentive awards granted for
suggestions relate to an employee's voluntary participation in an agency
suggestion program. See Federal Personnel Manual, Chapter 451. In
determining whether a proposal prescribing the amount or range of
amounts of incentive awards is negotiable, therefore, the Authority
looks to see whether the award is ultimately based in the exercise of a
management right, as is the case with performance awards. Compare
National Treasury Employees Union, Chapter 207 and Federal Deposit
Insurance Corporation, Washington, D.C., 14 FLRA 598, 6D1-4 (1984)
(Union Proposal 2), appeal docketed as to other matters sub nom.
National Treasury Employees Union v. Federal Labor Relations Authority,
No. 84-1286 (D.C. Cir. july 6, 1984), in which the Authority held a
proposal establishing the amount of a suggestion award to be within the
duty to bargain.
C. Conclusion
For the reasons more fully set forth in our decision in the Internal
Revenue Service case cited above, Union Proposals not within the duty to
bargain. Moreover, for the reasons discussed below in connection with
Union Proposals 2 and 3, we find that Union Proposal 1 does not
interfere with management's right to determine its budget and is not
inconsistent with 5 U.S.C. 4502 and 4503.
IV. Union Proposals and 2 and 3
The minimum cash award will be $37.50 for adopted suggestions
resulting in tangible benefits of $250.00.
. . . . .
Benefits to Government Amount of Award
up to $10,000 15% of benefits
$10 - 100 thousand $1500 plus 5% over
$10 thousand
over $100 thousand $5000 plus 5% over
$100 thousand
A. Positions of the Parties
In addition to the arguments raised in connection with Union Proposal
1, the parties are in dispute as to whether Union Proposals 2 and 3 are
also nonnegotiable because they are inconsistent with management's
right, under section 7106(b) (1), to determine the methods, means and
technology of performing its work.
B. Analysis
1. Management rights
As explained by the Union, Union Proposals 2 and 3 would leave to the
discretion of the Agency the decision as to whether to grant an award;
however, once the decision to grant such an award was made the terms of
the proposal would apply with respect to determining the amount of the
award.
In American Federation of Government Employees, AFL-CIO and Air Force
Logistics Command, Wright-Patterson Air Force Base, Ohio, 2 FLRA 603
(198D), enforced as to other matters sub nom. Department of Defense v.
Federal Labor Relations Authority, 659 F.2d 1140 (D.C. Cir. 1981), cert.
denied sub nom. AFGE v. FLRA, 455 U.S. 945 (1982), the Authority stated
generally that it would find a proposal inconsistent with an agency's
right to determine its budget if the proposal by its terms prescribed a
particular program or an amount of funds to be included in the agency' s
budget or if the agency made a substantial demonstration that the
proposal would result in a significant and unavoidable increase in costs
which would not be offset by compensating benefits. Union proposals 2
and 3 prescribe neither a particular program /1/ nor an amount of funds
to be included in a budget. Assuming, as the Agency contends, that it
would be required by the proposals to budget larger amounts for its
incentive awards program, it has not demonstrated that such increase,
would not be offset by compensating benefits. In fact, the proposals
would specifically link the amount of an award to the amount of benefits
to the government which resulted from the suggestion being rewarded.
Nor can the Agency's assertion that the proposals would interfere
with its right under section 7106(b) (1) to determine the technology,
methods, and means of performing work be sustained. The Agency contends
that if, because of budgetary restraints, it were unable to provide an
award in the amount specified by the proposals, it would be prevented
from implementing a suggestion which could involve worthwhile
improvements to the technology, methods, and means of performing work.
The Agency's assertion that its inability to provide a specified award
would preclude implementation of suggested improvements to technology,
methods, and means is not persuasive. An employee whose suggestion is
adopted has the right to be considered for an award and an agency is not
bound to grant an award upon adoption of a suggestion. Federal
Personnel Manual, Chap. 451, Subchap. 8-5; see also Stephen L.
Kempinski v. The United States, 164 Ct.Cl. 451 (1964), Cert. denied, 377
U.S. 981 (1964).
2. Inconsistent with Federal Law
Finally, the Agency contends that the proposals are contrary to the
provisions of 5 U.S.C. 4502 and 4503, which it describes as reserving to
the head of each agency the right to determine the amount of each
incentive award. Those statutory provisions vest agencies with the
discretion to, among other things, determine the amount to be paid as
awards for suggestions. /2/ The Authority has held that to the extent
that an agency has discretion with respect to a matter affecting the
conditions of employment of its employees, that matter is within the
duty to bargain. National Treasury Employees Union, Chapter 6 and
Internal Revenue Service, New Orleans District, 3 FLRA 748 (1980).
Absent any indication that the discretion provided to agency heads in 5
U.S.C. 4502 and 4503 is intended to be sole and exclusive, the Agency's
position cannot be sustained.
C. Conclusion
For the foregoing reasons we find that Union Proposals 2 and 3 do not
directly interfere with management's rights to determine its budget or
to determine the methods, means, or technology of performing its work.
We also find that Union Proposals 2 and 3 are not inconsistent with 5
U.S.C. 4502 and 4503.
V. Order
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 with respect to Union Proposal 1. IT IS FURTHER
ORDERED that the Agency shall upon request (or as otherwise agreed to by
the parties) bargain on Union Proposals 2 and 3. /3/
Issured, Washington, D.C., March 20, 1986
Jerry L. Calhoun, Chairman
Henry B. Frazier III. Member
Federal Labor Relations Authority
--------------- FOOTNOTES$ ---------------
/1/ Agencies are required pursuant to 5 CFR 451.205(a) (3) (1984
Supp.) to allocate "an adequate budget" to assure prompt action on
incentive awards.
/2/ Those sections provide as follows:
4502. General provisions
(a) Except as provided by subsection (b) of this section, a cash
award under this subchapter may not exceed $10,000.
(b) When the head of an agency certifies to the Office of Personnel
Management that the suggestion, invention, superior accomplishment, or
other meritorious effort for which the award is proposed is highly
exceptional and unusually outstanding, a cash award in excess of $10,000
but not in excess of $25,000 may be granted with the approval of the
Office.
(c) A cash award under this subchapter is in addition to the regular
may of the recipient. Acceptance of a cash award under this subchapter
constitutes an agreement that the use by the Government of an idea,
method, or device for which the award is made does not form the basis of
a further claim of any nature against the Government by the employee,
his heirs, or assigns.
(d) A cash award to, and expense for the honorary recognition of, an
employee may be paid from the fund or appropriation available to the
activity primarily benefiting or the various activities benefiting. The
head of the agency concerned determines the amount to be paid by each
activity for an agency award under section 4503 of this title. The
President determines the amount to be paid by each activity for a
Presidential award under section 4504 of this title.
4503. Agency awards
The head of an agency may pay a cash award to, and incur necessary
expense for the honorary recognition of, an employee who--
(1) by his suggestion, invention, superior accomplishment, or
other personal effort contributes to the efficiency, economy, or
other improvement of Government operations or achieves a
significant reduction in paper work; or
(2) performs a special act or service in the public interest in
connection with or related to his official employment.
/3/ In finding Union Proposals 2 and 3 to be negotiable, the
Authority makes no judgement as to their merits.