Petition for review at 1 (emphasis added).

III.     Background

      Due to a reorganization, six unit positions at the Activity were transferred to a newly established Regional Resources Service Office. The Agency characterized this reorganization as a "transfer of work," rather than as a "transfer of function." Statement of Position (SOP) at 2. The six incumbents were offered a position at the same grade and pay level. They were notified that their current positions would be subject to a future RIF. Employees were told that they would remain physically located at their current duty station but that their permanent duty station could change.

      One employee, James Hudson, declined the offer, in April 1998. At the time, he was informed that "Should you decide not to accept this offer you may be identified as a surplus employee and be subject to future reduction-in-force action." Response at 6, quoting Agency's communication to Hudson. On October 8, 1998, the Agency notified the Union that the position occupied by Hudson was determined to be surplus and subject to a one-person RIF.

      The parties executed a memorandum of understanding (MOU) concerning Hudson's RIF, but the Agency identified one of the unresolved issues as Hudson's eligibility for the Department of Defense [DoD] PPP. The Agency declared the Union's outplacement proposal nonnegotiable based upon the reference to the PPP. In this connection, the Agency's cover letter accompanying the revised MOU states that "the HRSC-East is responsible for this determination based on DoD regulations. Therefore, eligibility for PPP is not within the scope of bargaining." Cover letter to MOU dated November 4, 1998, Tab E submitted with SOP and quoted in SOP at 3-4.

IV.     Positions of the Parties

A.     Agency

      The Agency asserts that the proposal conflicts with the the DoD Priority Placement Program Operations Manual, Chapter 3, Section B1b(2) and section C10 (regulation), for which there is a compelling need. In support of its argument that there is a compelling need for the regulation, the Agency contends that it implements a mandate to the Agency that is essentially nondiscretionary. It also asserts that the regulation is essential to the execution of functions of the agency in a manner consistent with the requirement of an effective and efficient government, and that the regulation is designed to maintain merit principles. [n1] The Agency states that eligibility for the PPP "is premised on the [ v56 p 215 ] employees' being adversely affected through no fault of their own." SOP at 4.

      The Agency states that "On its face," the proposal does not conflict with the Agency regulation. Id. at 5. However, the Agency claims that Hudson became ineligible by declining the position offered. Therefore, according to the Agency, inclusion in the PPP "would mean that Mr. Hudson would be eligible to register for the program contrary to program requirements." Id. The Agency asserts that it has no Authority to change the eligibility criteria of the PPP.

B.     Union

1.     Meaning of the Proposal

      The Union submits the following statement of meaning of the proposal:

     The Union's proposal is intended to ensure that all bargaining unit employees affected by the Reduction in Force (RIF) will be offered outplacement assistance and be allowed to register for placement assistance programs. The Union's proposals [sic] also intend to ensure that placement assistance would begin as soon as the employee is notified of a RIF action.

     The following explanation of uncommon language is provided:

2.     Response to Agency's Statement of Position

      The Union agrees that the DoD Priority Placement Operations Manual, which addresses the Program, is an Agency-wide regulation. However, the Union claims, first, that the PPP is not mandated, or "inflexible," and, second, that the Agency has not shown that there is conflict between the Agency-wide regulation and the proposal. In this regard, the Union asserts that the regulation makes employees ineligible for the PPP if they have declined a transfer of function within the commuting area, but not if they have declined a transfer of work within the commuting area.

      As to the specifics of Hudson's situation, the Union claims, contrary to the Agency, that Hudson neither declined an equivalent offer within the commuting area nor did he decline a valid job offer. The Union states that because he "was not in receipt of a specific RIF notice in April 1998 [when the Agency claims he declined an offer]," he could not "decline a valid offer if there is no valid offer to decline." Response at 6.

      The Union also argues that the proposal is an appropriate arrangement.

V.     Analysis and Conclusions

A.     Meaning of the Proposal

      The Union's explanation comports with the plain meaning of the proposal. We find that the proposal means that employees subject to a reduction in force are entitled to register for and receive outplacement assistance, including the PPP.

B.     There Is No Conflict Between the Proposal and the Agency-wide Regulation

      To demonstrate that a proposal is nonnegotiable under section 7117(a)(2) because it is barred by an agency regulation for which a compelling need exists, an agency must (1) identify a specific agency-wide regulation; (2) show that there is a conflict between its regulation and the proposal; and (3) demonstrate that its regulation is supported by a compelling need with reference to the Authority's standards set forth in section 2424.50 of the Authority's Regulations. American Federation of Government Employees, Local 1786 and U.S. Department of the Navy, Marine Corps Combat Development Command, Marine Corps Base, Quantico, Virginia, 49 FLRA 534, 542 (1994), citing American Federation of State, County and Municipal Employees, Local 3097 and U.S. Department of Justice, Justice Management Division, 42 FLRA 412, 466 (1991).

      There is no dispute that the DoD Priority Placement Operations Manual, which implements the PPP, is an Agency-wide regulation. As to whether the proposal conflicts with the regulation, the Agency concedes that facially the two are not in conflict, stating, "[t]he Union's argument, on its face, supports the purpose of the [Program]; however, . . . at issue in this case is not . . . the proposal itself but the reason the proposal was advanced by the Union[.]" SOP at 10. Thus, the Activity bases its argument that there is a conflict between the proposal and the regulation on the assertion that the Program does not apply to Hudson, the individual whose proposed RIF prompted the negotiations. [ v56 p 216 ]

      On the basis of the record in this case, we find that the Agency concedes that the regulation and the proposal do not conflict. In addition, the parties have no disagreement about the inclusions and exclusions for eligibility set out in the regulation, and the Union's proposal seeks no change in the regulation. The parties simply disagree about the application of the rules to Hudson. Thus, the only dispute is as to how the regulation should apply to Hudson, if, after negotiations, the proposal is agreed upon.

      As we conclude that there is no conflict between the proposal and the Agency-wide regulation, we do not address the Agency's sole argument that there is a compelling need for the regulation. In the circumstances, it also is unnecessary to address the Union's contention that the proposal is an appropriate arrangement.

VI.     Order

      The Agency shall, upon request, negotiate over the proposal.

   The criteria for determining whether there is a compelling need for agency rules and regulations are currently set out at 5 C.F.R. § 2424.50.