United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued May 6, 2008 Decided August 5, 2008
No. 07-1422
ASSOCIATION OF CIVILIAN TECHNICIANS, PUERTO RICO ARMY
CHAPTER,
PETITIONER
v.
FEDERAL LABOR RELATIONS AUTHORITY,
RESPONDENT
On Petition for Review of an Order
of the Federal Labor Relations Authority
Daniel M. Schember argued the cause and filed the briefs
for petitioner.
James F. Blandford, Attorney, Federal Labor Relations
Authority, argued the cause for respondent. With him on the
brief was William R. Tobey, Deputy Solicitor.
Before: TATEL, GARLAND, and GRIFFITH, Circuit Judges.
GARLAND, Circuit Judge: The Association of Civilian
Technicians, Puerto Rico Army Chapter (ACT), petitions for
review of a ruling by the Federal Labor Relations Authority
(FLRA) concerning a contract provision that requires
2
reimbursing employees for certain personal expenses. The
Department of Defense (DOD) deemed the provision contrary
to law and thus not negotiable under the federal collective
bargaining statute, 5 U.S.C. §§ 7101 et seq. FLRA agreed,
holding that the provision is contrary to law because it would
require the agency to spend appropriated funds without
congressional authorization.
On its third visit to this court, ACT contends that the
collective bargaining statute itself provides the requisite
authorization, and that the disputed reimbursement provision is
an “appropriate arrangement[]” under § 7106(b)(3) of the
statute. In the proceedings below, FLRA disagreed, finding that
the provision is not an appropriate arrangement within the
meaning of § 7106(b)(3). Because we defer to that reasonable
determination, we deny ACT’s petition without addressing the
broader question of whether the collective bargaining statute
implicitly authorizes expenditures to implement contract
provisions that are negotiable under the statute.
I
ACT and the Puerto Rico National Guard negotiated a
contract provision requiring the Guard to reimburse employees
for lost personal travel and recreational expenses whenever the
agency cancels previously approved leave. The provision states:
Once leave has be[en] approved and the employer has
a compelling need to cancel the previously approved
leave, the employer agrees not to subject the employee
to a loss of funds expended in the planning of the leave
(i.e., hotel reservations, airline tickets, etc.). The
employee will demonstrate the unavoida[bility] of the
loss of funds.
3
Association of Civilian Technicians, Puerto Rico Army Chapter,
60 F.L.R.A. (No. 180) 1000, 1000 (May 31, 2005) (“Order”)
(alteration in original).
Under the Federal Services Labor-Management Relations
Act, 5 U.S.C. §§ 7101 et seq. (hereinafter, the “collective
bargaining statute”), the head of an agency must approve a
collective bargaining agreement between the agency and a union
“if the agreement is in accordance with the provisions of this
chapter and any other applicable law.” 5 U.S.C. § 7114(c)(2).
The Secretary of Defense disapproved the provision at issue
here as contrary to federal appropriations law and hence outside
the Defense Department’s obligation to bargain. ACT appealed
to FLRA, which upheld the Department’s decision. The
Authority found that expenditures for employee travel are
unlawful unless authorized by the Travel Expenses Act, 5 U.S.C.
§§ 5701 et seq., and concluded that because the expenditures
required by the disputed provision are for “purely personal
expenses,” the Travel Expenses Act does not authorize them.
Association of Civilian Technicians, Puerto Rico Army Chapter,
56 F.L.R.A. (No. 77) 493, 497 (2000).
ACT then filed the first of three petitions for review in this
court. On review of the first petition, we vacated FLRA’s
decision, holding that the Travel Expenses Act is irrelevant to
the reimbursement provision because the Act merely “authorizes
official travel” and “does not by its terms prohibit anything.”
Association of Civilian Technicians, Puerto Rico Army Chapter
v. FLRA, 269 F.3d 1112, 1116 (D.C. Cir. 2001) (ACT I). We
remanded the case for FLRA to consider ACT’s contentions that
the expenditures required by the disputed provision are
authorized by the collective bargaining statute generally or by
the specific section of the statute that permits negotiation of
“appropriate arrangements for employees adversely affected by
4
the exercise of [agency management] authority.” 5 U.S.C. §
7106(b)(3); see ACT I, 269 F.3d at 1118.
On remand, FLRA again held that the reimbursement
provision is contrary to law because it requires the unauthorized
expenditure of appropriated funds. Without addressing the
specific question of whether the reimbursement provision is an
“appropriate arrangement[]” under the collective bargaining
statute, FLRA held that the statute does not explicitly or
implicitly authorize the expenditure of appropriated funds for
the reimbursements called for by the disputed provision. The
Authority also rejected the union’s argument that DOD’s
appropriation for general operating expenses gives it discretion
to make expenditures to implement the reimbursement
provision. See Association of Civilian Technicians, Puerto Rico
Army Chapter, 58 F.L.R.A. 318, 321-24 (2003).
ACT then filed its second petition for review, and we again
vacated and remanded. See Association of Civilian Technicians,
Puerto Rico Army Chapter v. FLRA, 370 F.3d 1214, 1223 (D.C.
Cir. 2004) (ACT II). We held, inter alia, that FLRA had failed
to explain adequately its conclusion that the collective
bargaining statute, in conjunction with DOD’s general
appropriations statute, does not implicitly authorize expenditures
under the reimbursement provision as “‘official business’” of the
Department. Id. at 1219-20 (quoting Bureau of Alcohol,
Tobacco and Firearms v. FLRA, 464 U.S. 89, 107 (1983)
(BATF)). We also noted that FLRA had failed to address at all
whether reimbursements under the provision “would be
authorized as an ‘appropriate arrangement[]’ under 5 U.S.C. §
7106(b)(3) and therefore implicitly authorized under [DOD’s]
Appropriations Act.” Id.1 But we made it clear that, if FLRA
1
We further found that FLRA had failed to explain adequately its
rejection of ACT’s contention that “the reimbursements are implicitly
5
“adequately explained” a conclusion “that [the provision] was
not an ‘appropriate arrangement[],’” that “would presumably be
the end of the matter” -- “absent express congressional
authorization for such reimbursements,” which ACT does not
assert exists here. Id. at 1221.
On remand, FLRA dismissed ACT’s appeal for a third time.
In the decision now under review, it held that expenditures
under the reimbursement provision do not constitute “official
business.” See Order, 60 F.L.R.A. at 1004-07. FLRA also held
that the provision is not an “appropriate arrangement[]” under §
7106(b)(3), because it would “excessively interfere[]” with the
right of agency management to assign work. See id. at 1007-08.
FLRA subsequently denied ACT’s motion for reconsideration,
Association of Civilian Technicians, Puerto Rico Army Chapter,
62 F.L.R.A. (No. 38) 144 (2007), and this petition for review
followed.
II
We review FLRA decisions under the Administrative
Procedure Act, which requires the court to “set aside agency
actions and conclusions found to be ‘arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance with law.’”
BATF, 464 U.S. at 97 n.7 (quoting 5 U.S.C. § 706). Because
“FLRA was intended to develop specialized expertise in its field
of labor relations and to use that expertise to give content to the
principles and goals” of the collective bargaining statute, the
Authority is entitled to “considerable deference when it
exercises its special function of applying the general provisions
authorized under [DOD’s] Appropriations Act” pursuant to the
“necessary expense doctrine” identified in opinions of the Comptroller
General. ACT II, 370 F.3d at 1221 (citing 6 Comp. Gen. 619, 621
(1927)).
6
of the Act to the complexities of federal labor relations.” Id. at
97 (internal quotation marks omitted). “As the collective
bargaining law is FLRA’s own enabling statute,” we also “owe
‘considerable deference’ to FLRA’s interpretation” of that
statute. ACT II, 370 F.3d at 1219 (quoting BATF, 464 U.S. at
97).
Although this case has a complicated history, the parties’
pleadings have greatly simplified the issues now before us.
ACT agrees that a collective bargaining proposal is contrary to
law, and hence not subject to bargaining, if it requires
expenditure of appropriated funds for a purpose not authorized
by law. See, e.g., ACT I, 269 F.3d at 1116; see generally ACT
Reply Br. 4-8. It maintains, however, that: (1) the collective
bargaining statute implicitly authorizes expenditures to
implement contract provisions that are negotiable under the
statute; and (2) the disputed reimbursement provision is
negotiable under the statute because it is an “appropriate
arrangement” under § 7106(b)(3). FLRA disputes each
proposition. Both parties agree, however, that if the
reimbursement provision is not an appropriate arrangement
under the statute, then we may affirm FLRA’s decision without
further analysis. Oral Arg. Recording at 1:30 (ACT); id. at
14:00 (FLRA). ACT does not contend that any law other than
the collective bargaining statute authorizes the expenditures
required by the provision, and does not contend that any section
of the statute other than the “appropriate arrangement” section
applies. Accordingly, we turn to the question of whether the
reimbursement provision is an appropriate arrangement under §
7106(b)(3).
In general, the collective bargaining statute imposes upon
federal agencies and labor organizations a duty to bargain in
good faith with respect to conditions of employment, subject to
certain exceptions. See generally 5 U.S.C. §§ 7102,
7
7103(a)(12), 7114(a)(4), 7117(a); ACT II, 370 F.3d at 1217.
One such exception is set forth in § 7106(a), which excludes
enumerated “management rights” from the realm of negotiation.
See Patent Office Prof’l Ass’n v. FLRA, 47 F.3d 1217, 1220
(D.C. Cir. 1995). As is relevant here, § 7106(a) provides that,
“[s]ubject to subsection (b) of this section, nothing in this
chapter shall affect the authority of any management official of
any agency” to “assign . . . employees” and to “assign work.”
5 U.S.C. § 7106(a)(2). Subsection 7106(b) then “lists certain
kinds of proposals that would affect these managerial rights, yet
remain proper subjects of collective bargaining.” American
Fed’n of Gov’t Employees [AFGE], AFL-CIO, Local 1923 v.
FLRA, 819 F.2d 306, 308 (D.C. Cir. 1987). In particular, §
7106(b)(3) states that “[n]othing in this section shall preclude
any agency and any labor organization from negotiating . . .
appropriate arrangements for employees adversely affected by
the exercise of any authority under this section by such
management officials.” 5 U.S.C. § 7106(b)(3) (emphasis
added). Hence, “a proposal advancing . . . an appropriate
arrangement for adversely affected employees falls within the
scope of an agency’s duty to bargain, notwithstanding that
implementation of the proposal would affect the enumerated
managerial rights.” AFGE Local 1923, 819 F.3d at 308.
To determine whether a proposal is an “appropriate
arrangement” under § 7106(b)(3), FLRA asks whether the
proposal “excessively interferes” with management rights.
National Ass’n of Gov’t Employees, Local R14-87 and Kansas
Army Nat’l Guard, 21 F.L.R.A. (No. 4) 24, 31 (1986) (KANG).
FLRA adopted that test upon this circuit’s suggestion, see id.
(citing American Fed’n of Gov’t Employees [AFGE], AFL-CIO,
Local 2782 v. FLRA, 702 F.2d 1183, 1188 (D.C. Cir. 1983)), and
we have repeatedly cited it with approval in reviewing FLRA
decisions, see ACT II, 370 F.3d at 1221; Patent Office Prof’l
Ass’n, 47 F.3d at 1221; AFGE Local 1923, 819 F.2d at 308-09.
8
Under the test, “[a]ssuming that the proposal, as a threshold
matter, suggests an arrangement for adversely affected
employees, the decisionmaker must ask whether implementation
of the proposed arrangement would ‘impinge upon management
prerogatives to an excessive degree.’” AFGE Local 1923, 819
F.3d at 308 (quoting AFGE Local 2782, 702 F.2d at 1188). As
FLRA does not dispute that the reimbursement provision “is
intended to ameliorate the adverse effects of the exercise of a
management right, i.e., the cancellation of leave,” FLRA Br. 36,
the only issue is whether the provision’s interference with that
right is excessive.
“The determination whether an interference with
managerial prerogatives is excessive depends primarily on the
extent to which the interference hampers the ability of an agency
to perform its core functions -- to get its work done in an
efficient and effective way.” AFGE Local 1923, 819 F.3d at
308-309. That inquiry involves “weighing the competing
practical needs of employees and managers.” KANG, 21
F.L.R.A. at 31-32. We “afford considerable deference to the
FLRA’s balancing of management and employee interests under
its ‘excessive interference’ test.” U.S. Dep’t of Treasury, Office
of Chief Counsel, I.R.S. v. FLRA, 960 F.2d 1068, 1074 (D.C.
Cir. 1992).
In this case, FLRA determined that the disputed
reimbursement provision would excessively interfere with
management’s right “to assign work and assign employees.”
Order, 60 F.L.R.A. at 1007. The Authority noted that “the
provision would require the Agency to reimburse employees not
only for expenses necessary to return to work from cancelled
leave, but also for unused theater, sports, and banquet tickets.”
Id. “The agency’s liability under the provision,” FLRA held, “is
so uncontrollable, so unforeseeable, and so unrelated to the
Agency’s exercise of its right to assign work as to be excessive.”
9
Id. In particular, “the absence of any limit or cap on the
Agency’s potential economic liability would interfere with or
hinder the Agency’s decisions to cancel leave of employees in
mobilizing and deploying employees for military missions.” Id.;
see ACT II, 370 F.3d at 1221 (noting that whether a provision
excessively interferes with management rights “may turn on a
variety of considerations, including, for example, whether or not
there is a cap on the amount of individual expenditures or a
limited period of time for covered expenditures”).
ACT argues that, with the reimbursement provision,
“management might be less disinclined to cancel and assign
work [because] it knows that it can hold harmless, at least
financially, the employee that it wants to do the work.” ACT
Br. 25. We do not discount the possibility that management
might react that way, but the sole question before us is whether
the Authority’s contrary analysis is unreasonable. And we see
no basis upon which to reject as unreasonable FLRA’s
conclusion that an unlimited and uncontrollable financial
obligation will dissuade the Guard from cancelling leave when
necessary, thereby impeding the agency’s ability to deploy its
members and fulfill its mission. ACT effectively concedes as
much, stating that “either view might be reasonable and
sincerely held.” Id.
Contrary to ACT’s contention, id. at 26, FLRA did not hold
that an expenditure cap is always required if a reimbursement
provision is to constitute an “appropriate arrangement.” Rather,
it stated only that, in the specific context of the provision at
issue in this case, the lack of a cap exacerbates the burden on
agency decisionmaking. See Order, 60 F.L.R.A. at 1007; FLRA
Br. 39 n.14. Nor did FLRA render a decision that applies to a
broad swath of cases beyond the one before it. See Order, 60
F.L.R.A. at 1007; Oral Arg. Recording at 12:30. Rather, the
Authority emphasized that its decision was based on the
10
relationship between the provision at issue and the particular
agency mission with which it interferes. The “provision
conflicts,” the Authority held, “with the already noted mission
of the Guard as ‘a military organization dedicated to a military
mission that provides trained personnel for ‘mobilization in
times of war, national emergency or civil disruption.’” Order,
60 F.L.R.A. at 1007-08 (quoting Association of Civilian
Technicians, Wichita Air Capitol Chapter, 60 F.L.R.A. (No. 73)
342, 347 (2004)) (internal quotation marks omitted).
Finally, the Authority’s decision is not a departure from its
own precedent, as ACT suggested below and at oral argument.
As FLRA explained, the principal decision that ACT relies upon
for this contention “involved the use of nonappropriated funds
that are not subject to the same statutory restrictions on the use
of appropriated funds at issue here.” Order, 60 F.L.R.A. at 1008
(distinguishing National Ass’n of Gov’t Employees, Local R4-
26, 40 F.L.R.A. (No. 15) 118, 119-23 (1991)). In addition, “the
question of whether the proposal was an appropriate
arrangement was not before” the Authority in that case.
Association of Civilian Technicians, Puerto Rico Army Chapter,
62 F.L.R.A. (No. 38) 144, 146 (2007) (order denying motion for
reconsideration). And “unlike the reimbursements in this case,”
FLRA noted, the other precedents cited by ACT concerning
“uniform allowances, certain health benefits, and employee
travel expenses, have been [expressly] authorized by Congress.”
Order, 60 F.L.R.A. at 1008 n.3 (citing statutory authorizations).
For the foregoing reasons, we conclude that FLRA’s
determination that the disputed contract provision is not an
appropriate arrangement survives the deferential standard of
review applicable to its decisions under the collective bargaining
statute. See BATF, 464 U.S. at 97 & n.7; ACT II, 370 F.3d at
1219.
11
III
In our previous opinion in this case, we stated that, if FLRA
“adequately explained” a conclusion that the reimbursement
provision was not an “appropriate arrangement” under 5 U.S.C.
§ 7106(b)(3), that “would presumably be the end of the matter.”
ACT II, 370 F.3d at 1221. FLRA has now provided an adequate
explanation, and that does indeed end the matter. Accordingly,
the petition for review is
denied.