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United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued January 9, 2006 Decided February 17, 2006
No. 04-1433
NATIONAL TREASURY EMPLOYEES UNION,
PETITIONER
v.
FEDERAL LABOR RELATIONS AUTHORITY,
RESPONDENT
On Petition for Review of an Order of the
Federal Labor Relations Authority
Timothy B. Hannapel argued the cause for petitioner. With
him on the briefs were Larry J. Adkins and Gregory O’Duden.
David M. Shewchuk, Attorney, Federal Labor Relations
Authority, argued the cause for respondent. With him on the
brief were David M. Smith, Solicitor and William R. Tobey,
Deputy Solicitor.
Before: HENDERSON, ROGERS and BROWN, Circuit Judges.
2
Opinion for the Court filed by Circuit Judge ROGERS.
ROGERS, Circuit Judge: In National Treasury Employees
Union v. Federal Labor Relations Authority, 404 F.3d 454 (D.C.
Cir. 2005) (“NTEU I”), the court granted the Union’s petition
and remanded the case to the Authority because its findings
were unsupported by the record before it. The Union again
contends that a negotiability ruling of the Authority on two
Union proposals is arbitrary and capricious because they are
unsupported by the record and contrary to Authority precedent.
See NTEU v. U.S. Dep’t of Homeland Sec. Customs and Border
Prot. of Wash., D.C., 60 F.L.R.A 367 (Nov. 8, 2004)
(“Opinion”). We agree and grant the Union’s petition for
review.
I.
The Federal Service Labor-Management Relations Statute,
5 U.S.C. §§ 7101-7135 (2000), governs relations between
federal agency employers and federal employees. See NLRB v.
FLRA, 2 F.3d 1190, 1192 (D.C. Cir. 1993). The Statute confers
on federal employees a right to engage in collective bargaining
with respect to conditions of employment through their
representatives. See 5 U.S.C. § 7102(2). To effectuate this
right, the Statute requires each agency to “negotiate in good
faith” with the exclusive representative of the employees “for
the purposes of arriving at a collective bargaining agreement.”
Id. § 7114(a). The Statute sets some limits on the subjects over
which agencies are required to bargain. Certain management
rights are exempt from the duty to bargain, see id. § 7106(a),
including management’s right “to determine the . . . internal
security practices of the agency[,]” id. § 7106(a)(1). However,
section 7106 also provides:
Nothing in this section shall preclude any agency and
3
any labor organization from negotiating . . .
appropriate arrangements for employees adversely
affected by the exercise of any authority under this
section by such management officials.
Id. § 7106(b)(3) (emphasis added). The Statute further provides
that, upon an agency’s refusal to negotiate a proposal submitted
on behalf of its employees, the Authority shall “resolve[] issues
relating to the duty to bargain in good faith,” id. § 7105(a)(2)(E),
and that any person aggrieved by the Authority’s decision may
petition for review by a circuit court of appeals where the person
resides or transacts business or to this court, id. § 7123(a). No
objection not urged before the Authority shall be considered by
the court, unless the failure to object is “excused because of
extraordinary circumstances.” Id. § 7123(c).
The National Treasury Employees Union represents U.S.
Customs Service employees who have been carrying firearms as
part of their duties for many years. According to undisputed
facts recited in the Authority’s Opinion, these employees are
located in approximately 300 locations, only some of which
have facilities for on-site storage of Agency-issued firearms
during non-duty work hours. The Union identified
approximately ten locations currently permitting such storage.
Hence, at most locations Agency employees carrying firearms
must travel directly from work to home and store their firearms
overnight at home under secure conditions with an Agency-
provided safety lock, unless they are covered by the 24-hour
carry policy for Office of Field Operations Personnel
promulgated by the U.S. Treasury Department.1
1
At the time the Union petitioned for review by the
Authority, the U.S. Customs Service was part of the Treasury
Department and the bargaining unit employees were subject to both
Treasury Department and Customs Service policies on firearms use
4
The 24-hour carry policy, dated March 3, 2000, provides
that eligible Agency employees may carry their service-issued
firearms twenty-four hours a day, provided they “significantly
modif[y]” their behavior while armed. Such behavioral
modifications and restrictions include refraining from the
consumption of alcoholic beverages, limiting use of the firearm
and concealing the firearm when the employee is not in uniform.
The policy emphasizes that authority to carry a firearm “presents
a tremendous responsibility and has potential for significant
liabilities to the individual officer, as well as the Customs
Service.” Eligible employees who elect to be covered by the 24-
hour carry policy and to be bound by its terms are not required
to travel directly between home and work while carrying their
Agency-issued firearms. Under the guidelines contained in the
Agency’s handbook on firearms, employees must maintain
current credentials in order to carry a firearm, and the handbook
lists the types of conduct that could result in the loss of
credentials “based on a nexus between these actions and a threat
to the safety of the employee or others.” U.S. Department of the
Treasury, U.S. Customs Service, Firearms and Use of Force
Handbook (July 1996).
By the terms of the 24-hour carry policy dated December
28, 2000, all employees authorized to carry firearms in the
performance of their official duties “are personally responsible
for the security of all firearms to prevent unauthorized use,
unintentional discharge, and theft,” and specific requirements
are set on how firearms not in the employee’s immediate control
are to be secured. The Union sought to bargain over
implementation of the changes in the 24-hour carry policy and
made a number of proposals, two of which are at issue here.
First, the Union proposed that employees who carry their
and storage. See Opinion at **1.
5
weapons to and from their residences be permitted “to make
reasonable diversions and stops between their residence and
work. These diversions and stops will be defined as those that
any ordinary citizen would make before and after work,”
Proposal 11 (emphasis added). Examples of “reasonable
diversions and stops” on which the Union sought to bargain
included shopping at a supermarket, stopping for gas, or
attending a child’s after-school soccer match. The Union
claimed that the proposal would mitigate the burden of the
current policy, which restricts employees’ freedom of movement
without monetary compensation, reduces employees’ non-duty
hours, and increases the effort and expenses associated with the
extra travel necessitated by the policy. The Agency advised the
Authority that Proposal 11 interfered with management’s right
to determine its internal security practices, including the right to
determine those policies and actions that will safeguard its
personnel and physical property, and that employees with 24-
hour carry authority who have completed firearms training are
automatically eligible for that authority and were free to make
reasonable diversions and stops. Because, in the Agency’s view,
the proposal applied only to employees who elected to carry
personally-owned firearms and the Agency no longer permitted
such carriage, the proposal was moot.
The Authority rejected the notion that Proposal 11 was
moot, but concluded that Proposal 11 excessively interfered with
management’s right to determine its internal security practices
under section 7106(a)(1) and thus was not within the Agency’s
duty to bargain under section 7106(b)(2). The Authority stated
that the Agency had determined that, in order to safeguard its
personnel, the public, and physical property, employees not
covered by the 24-hour carry policy should be required to carry
their firearms directly from work to home during non-duty
hours, without stops, until their firearms could be secured. The
Authority found that although Proposal 11 was an “arrangement
6
sufficiently tailored to aid those employees adversely affected
by the exercise of a management right, as it would benefit only
those employees who either fail training or refuse to sign the 24-
hour carry certificate,” Opinion at **11, it was not an
“appropriate arrangement,” id. The Authority reasoned that the
“minimal benefit” to be gained by such employees who cannot
or do not accept the conditions of the 24-hour carry policy “is
more than outweighed by the Agency’s interest in protecting the
public from the danger posed by employees carrying firearms,
especially if those employees are not operating under the
restrictions concerning conduct provided for in the 24-hour carry
policy.” Id.
Second, the Union proposed that internal investigations
upon suspension or rescission of an employee’s authority to
carry a firearm be conducted expeditiously. The Union made
several proposals regarding suspension or rescission, including
prompt notice to the employee of the reasons for the disciplinary
action, with an opportunity to respond promptly and to appeal,
and the Union’s right to file a grievance, but only one is at issue
on appeal. The Union proposed that “[i]n the event that [the
Agency] takes an officer’s firearm pending an internal
investigation, it will conduct an expeditious investigation on a
priority basis.” Proposal 14(f) (first sentence) (emphasis
added). In the absence of such language, the Union told the
Authority, it “cannot show arbitrators any [contract] language
which obligates the Agency to take any action within any time
frames once it has removed firearm carriage authority,” and that
the Agency “has no incentive, and before an arbitrator it will
argue it has no obligation, to conduct its investigations in an
expeditious manner, and as a result its firearms investigations
will continue in the same desultory manner that has been the
case for years.” Union’s Response to Agency’s Statement of
Position, dated Jan. 14, 2002, at 25. The Union explained that
the proposal would not prevent the Agency from taking the time
7
necessary to conduct a thorough investigation, but it would
reduce the amount of time between the initial denial, revocation,
or suspension of firearm carry authority and thus benefit the
employee whose authority is ultimately reinstated. The Agency
advised the Authority that Proposal 14(f) (first sentence) would
require it to make a decision based on set time frames rather
than on investigative facts and thus without full knowledge of
the circumstances. The Agency also claimed that the proposal
would interfere with management’s right to assign work.
The Authority concluded, with one Member dissenting, that
to the extent that Proposal 14(f) (first sentence) would require
the Agency to conduct an expeditious investigation on a priority
basis, the intrusion of the proposal into management’s right to
determine its internal security practices outweighed the benefits
it would provide some employees and therefore was not an
appropriate arrangement under section 7106(b)(3). The
Authority construed the Union’s proposal to “require the
Agency to give investigations related to firearms carriage
authority greater priority than any other investigations it
conducts in the course of accomplishing the Agency’s mission
no matter how much more time-critical or important those other
investigations might be.” Opinion at **22. It rejected the
Agency’s position that the proposal would interfere with its
ability to assign work.
II.
In NTEU I, 404 F.3d at 458, the court remanded the Union’s
proposal concerning the storage of handguns after the Authority
had ruled the proposal excessively interfered with
management’s rights to determine its internal security practices,
because the Authority’s determination was not supported by the
record before it. The Union contends the same defects exist in
the Authority’s decision here, particularly as the Authority failed
8
to abide by its precedent requiring it to balance the practical
effects of a proposal on management and employee interests.
Specifically, the Union contends that the Authority’s finding
that Proposal 11 was of “minimal benefit” to Agency employees
was without explanation or record support; that the Authority’s
finding regarding the Agency’s interest in “protecting the
public” is without record support and was not an interest
asserted by the Agency; and that the Authority’s implicit finding
that employees not covered by the 24-hour carry policy pose a
greater threat to the public than those who elect to be governed
by its restrictions is contradicted by the record. Similarly, the
Union contends that the Authority’s finding that Proposal 14(f)
(first sentence) would require the Agency to make investigations
of suspended certifications to carry firearms the Agency’s top
priority is neither based on record evidence nor a burden that
was asserted by the Agency. Because the Authority’s
determinations are not supported by the record, the Union
maintains that the Authority did not engage in a proper
application of its balancing test.
Our review is deferential, limited to determining whether
the Authority’s decision is arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law. See Bureau
of Alcohol, Tobacco and Firearms v. FLRA, 464 U.S. 89, 97 n.7
(1983); NTEU I, 404 F.3d at 456; Nat’l Ass’n of Gov’t
Employees, Local R5-136 v. FLRA, 363 F.3d 468 (D.C. Cir.
2004); Overseas Educ. Ass’n v. FLRA, 827 F.2d 814, 816 (D.C.
Cir. 1987); 5 U.S.C. § 706(2)(A) (2000).
The Authority applies a two-part test, known as “the KANG
test,” to determine whether proposals impinging upon
management rights under section 7106(a) should nonetheless be
considered negotiable under section 7106(b)(3) as “appropriate
arrangements” for adversely affected employees. See NTEU I,
404 F.3d at 457; NLRB, 2 F.3d at 1192, citing Nat’l Ass’n of
9
Gov’t Employees Local R14-87, 21 F.L.R.A. 24 (1986) (“Kansas
Army National Guard” or “KANG”). Under the KANG test, the
Authority first examines the record to determine whether a
proposal is intended to be an “arrangement” for employees
adversely affected by the exercise of a management right. See
KANG, 21 F.L.R.A. at 31. The burden is on the Union to
explain how employees will be detrimentally affected by
management’s action and how the proposal for bargaining is
intended to address or compensate for such effect. See id.
Under the second step, the Authority must evaluate whether an
“arrangement” “is inappropriate because it excessively
interferes” with the exercise of a management right. Id. This
requires the Authority to “weigh[] the practical needs of
employees and managers,” id. at 31-32, and involves an “open-
ended balancing analysis that may include consideration of such
factors as ‘the nature and extent of the impact experienced by
the adversely affected employees’ and ‘the nature and extent of
the impact on management’s ability to deliberate and act
pursuant to its statutory rights,’” NLRB, 2 F.3d at 1193, citing
KANG, 21 F.L.R.A. at 31-32.
In NTEU I, the court held that the Authority erred in
applying the KANG test to determine that a proposal did not
constitute an “appropriate arrangement” subject to bargaining
under section 7106(b)(3) because the record before the
Authority did not support its description of the Agency’s
security policy. See NTEU I, 404 F.3d at 457-58. The Authority
had concluded that a proposal on the storage of firearms would
preclude the Agency from exercising its right to determine its
internal security practices, notwithstanding the fact that the
record established that in many locations the Agency had
permitted on-site storage of firearms for off-duty employees and
even provided facilities for such storage. Id. at 458. The court
declared:
10
On the record before it and this [c]ourt, the Authority
has not established that the proposal would “negate and
nullify” the [A]gency’s right to implement the practice
it followed at the time the Union made the proposal.
The most the proposal would require is the institution
at other facilities of a method of carrying out [A]gency
internal security policies already in place at some
locations. Whether this constitutes an appropriate
arrangement is a question for the Authority to answer
but it must do so on findings based on the record
before it, and by a process consistent with its own
precedent.
Id. (citations omitted).
Similarly here, the Authority found both Union proposals
were arrangements within the internal security exception of
section 7106(a)(1), but the Authority’s determinations that the
proposals were not appropriate arrangements is not supported by
findings based on the record before it. The Authority reasoned
that:
Proposal 11 would require the Agency to permit
employees who cannot or do not accept the conditions
required for 24-hour carry authority to make stops
between their work site and their residence, while in
possession of their authorized firearm. This minimal
benefit is more than outweighed by the Agency’s
interest in protecting the public from the danger posed
by employees carrying firearms, especially if those
employees are not operating under the restrictions
concerning conduct provided for in the 24-hour carry
policy.
Opinion at **14 (emphasis added). The Authority offers no
explanation or basis in the record for its conclusion that the
11
benefit to the officers in being permitted to make the
“reasonable diversions and stops” would be “minimal.” Neither
does the Authority explain its conclusion that this “minimal
benefit” was “more than outweighed by the Agency’s interest in
protecting the public from the dangers posed by employees
carrying firearms, especially if those employees are not
operating under the restrictions concerning conduct provided for
in the 24-hour carry policy.” In purporting to describe the
Agency’s safety policy, the Authority pointed to nothing in the
record to indicate that the Agency, in fact, has an internal
security policy based on protecting the public from the greater
danger posed by employees carrying firearms who are not bound
by the 24-hour carry restrictions.
The Authority maintains on appeal that the restrictions in
the 24-hour carry policy and the Agency handbook “are
reasonably understood as objective evidence of [the Agency]’s
public safety concern over the carriage of firearms by employees
who are off-duty.” Resp.’s Br. at 24. “Firearms are dangerous,
and extraordinary dangers sometimes justify unusual
precautions.” Florida v. J.L., 529 U.S. 266, 272 (2000). The
question posed by the Union’s proposal, however, is whether
there is any material difference between the conditions under
which employees who volunteer for the 24-hour carry policy
carry firearms and the conditions under which other authorized
employees carry firearms. The Union contends there are no
material differences.2 The Authority also maintains that
2
Contrary to the Authority’s position, 5 U.S.C. § 7123(c)
does not bar consideration of the Union’s challenges to the findings
underlying the Authority’s determination that its proposals were not
appropriate arrangements, for the Union argued before the Authority
that the proposals were appropriate arrangements and set forth its
reasoning. Cf. U.S. Dep’t of Defense, National Guard Bureau, Rhode
Island National Guard v. FLRA, 982 F.2d 577, 580 (D.C. Cir. 1993).
12
Proposal 11 would have nullified certain safety-oriented
restrictions on employee carriage of firearms off duty. Maybe
so, but the Authority did not identify those restrictions in its
Opinion, much less balance the practical effect of any
differences against the employee benefits, which the KANG test
requires. Finally, the Authority maintains that it was reasonable
for it to recognize that the Agency has an interest in
safeguarding the public as part of management’s right to
determine its internal security practices. Even so, this leaves
open the question presented by Proposal 11. The Agency did
not identify any specific safety concern to explain why
employees who did not have 24-hour carry authority could not
be granted some of the leeway in carrying firearms off duty that
the 24-hour policy affords. Moreover, the Agency’s reason for
refusing to bargain over this proposal was that after completion
of training all employees are automatically eligible for 24-hour
carry authority. This lends some support for the Union’s
position that employees who do not have 24-hour carry authority
do not pose any greater danger to public safety and, therefore,
should not be bound by greater firearm carriage restrictions than
those employees covered by the 24-hour carry policy.
The Union expressed concern that the internal security
policy as stated by the Authority in its Opinion, and not
advanced by the Agency, is so broad as to render any Union
proposal involving firearms non-negotiable, rather than
reflecting an actual KANG balancing of competing needs, which
would give meaning to section 7106(b)(3). See Am. Fed of
Gov’t Employees, AFL-CIO, Local 2782 v. FLRA, 702 F.2d
1183, 1186-87 (D.C. Cir. 1983). The problem is not one of
overbreadth but rather the Authority’s dismissal without
explanation of any counter-balancing benefit to employees
under Proposal 11. The Authority may be of the opinion that no
employee interest could outweigh the Agency’s interest in
controlling and restricting the use of firearms. It nonetheless
13
remains incumbent on the Authority in considering Proposal 11
to examine the record to determine the relevant differences, if
any, between restrictions for employees who are and who are
not subject to the 24-hour carry policy, to identify the
significance of any differences, to weigh the practical effects of
such differences on the competing interests under the KANG
test, and to set forth its reasoning and the principles underlying
its ultimate determination. See NTEU I, 404 F.3d at 458. The
Authority has not yet done this.
As for Proposal 14(f) (first sentence), the Authority
reasoned that expedited investigation related to firearm carriage
authority would come at the expense of all other pending
internal security investigations, and that this “intrusion upon the
Agency’s right to decide which investigative work is most
important to the accomplishment of the Agency’s operations
outweighs the benefits.” Opinion at **22. The opinion of the
dissenting Member, who characterized the expeditious
investigation provision of Proposal 14(f) as “a significant benefit
for employees,” id. at **34 (Member Pope, dissenting in part
and concurring in part), highlights the problems with the
Authority’s determination. First, the Agency had failed to
explain how expediting a relatively small number of cases
would intrude on its management right. The dissenting opinion
noted that the Agency had cited a survey showing the proposal
would apply to only 55 out of 8,000 employees who have had
their firearms authority removed for other than medical or
qualifications reasons. Second, the Agency did not dispute the
Union’s claim that employees are unable to perform important
aspects of their job when firearm carry permission is withdrawn.
Third, the Agency never asserted that proposal caused the
burden that the Authority found. Fourth, the Agency’s claim
that the proposal would require it to conclude investigations
prematurely was not only “inconsistent with the wording of the
proposal [but] expressly disavowed by the Union.” Id. at **34.
14
On appeal, the Authority points to the Union’s statement
that its proposal called for firearm-authority investigations to be
given priority in relation to other Agency investigations. This
still is not the same as a proposal calling for top priority over all
other Agency investigations. The Union’s statement, viewed in
context, was that its proposal was designed to provide
employees with an expected time frame for completion of the
internal investigation and some incentive for the Agency to
conduct investigations more expeditiously. The Union
submitted evidence that employees could not find out when their
investigations might be completed and that investigations,
despite Union inquiry, could linger for several years for no
apparent reason, to the detriment of employee loyalty,
motivation, and ability to earn overtime pay. The Union noted
that the situation was exacerbated by the fact that the Agency
was understaffed. Because the Authority’s determination that
Proposal 14(f) (first sentence) is not an appropriate arrangement
is based on findings that are unsupported by the record and, in
fact, appears to be contradicted by it and the Authority failed to
engage in a proper KANG balancing, we reverse the non-
negotiability determination.
Accordingly, we grant the petition, remanding Proposal 11
to the Authority to clarify its rationale and reversing the
Authority’s determination that Proposal 14(f) (first sentence) is
not an appropriate arrangement under 5 U.S.C. § 7106(b)(3).