Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-04-01137/USCOURTS-caDC-04-01137-0/pdf.json

Parties Involved:
Federal Labor Relations Authority
Respondent
National Treasury Employees Union
Petitioner
United States Customs and Border Protection
Intervenor for Respondent

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 7, 2005 Decided July 8, 2005

No. 04-1137

NATIONAL TREASURY EMPLOYEES UNION,

PETITIONER

v.

FEDERAL LABOR RELATIONS AUTHORITY,

RESPONDENT

UNITED STATES CUSTOMS AND BORDER PROTECTION,

UNITED STATES DEPARTMENT OF HOMELAND SECURITY

INTERVENOR

On Petition for Review of an Order of the

Federal Labor Relations Authority

Elaine D. Kaplan argued the cause for the petitioner. Gregory

O’Duden and Larry J. Adkins were on brief.

James F. Blandford, Attorney, Federal Labor Relations

Authority, argued the cause for the respondent. David M. Smith,

Solicitor, Federal Labor Relations Authority, and William R.

Tobey, Deputy Solicitor, Federal Labor Relations Authority,

were on brief.

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1 At the time this suit was initiated, the Customs Service was a

bureau within the Treasury Department. The Homeland Security Act

of 2002, however, transferred the Customs Service to the United

States Department of Homeland Security, whereupon it was renamed

the Bureau of Customs and Border Protection. See Pub. L. No. 107-

296, § 1502, 2002 U.S.C.C.A.N. (116 Stat.) 2135, 2308;

Reorganization Plan Modification for the Department of Homeland

Security, H.R. Doc. No. 108-32, at 4 (2003); see also 6 U.S.C.

§ 203(a)(1). Given the name change and for the sake of convenience,

we refer to the then-“Customs Service”/now-“Bureau of Customs and

Border Protection” simply as “Customs.”

Peter D. Keisler, Assistant Attorney General, United States

Department of Justice, William G. Kanter, Deputy Director, and

Sandra W. Simon, Attorney, were on brief for the intervenor. E.

Roy Hawkens, Attorney, entered an appearance.

Before: GINSBURG, Chief Judge, and HENDERSON and

RANDOLPH, Circuit Judges.

Opinion for the court filed by Circuit Judge HENDERSON.

KAREN LECRAFT HENDERSON, Circuit Judge: Granting the

exceptions taken by the United States Department of the

Treasury’s Customs Service1(Customs), the Federal Labor

Relations Authority set aside an arbitration award in favor of the

National Treasury Employees Union (NTEU). See United States

Dep’t of the Treasury Customs Serv., Washington, D.C.

(Agency) & Nat’l Treasury Employees Union (Union), 59 FLRA

703 (2004) (Customs Order), reprinted in Joint Appendix (J.A.)

at 271-96. The NTEU now petitions for review of the

Authority’s order, alleging that the Authority erred twice:

initially, by concluding that Customs exercised statutorily

protected management rights when it implemented a revised

National Inspectional Assignment Policy (NIAP); and, again, by

concluding that, assuming arguendo that Customs in fact

exercised its managements right in implementing the revised

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2

 Section 7106 provides: 

(a) Subject to subsection (b) of this section, nothing

in this chapter shall affect the authority of any

management official of any agency--

(1) to determine the mission, budget, organization,

number of employees, and internal security practices

of the agency; and

(2) in accordance with applicable laws--

(A) to hire, assign, direct, layoff, and retain

employees in the agency, or to suspend, remove,

reduce in grade or pay, or take other disciplinary

action against such employees;

NIAP, Customs was not obligated to bargain over the NTEU’s

ground rule proposal. Because the Authority erred in neither

respect, we deny the NTEU’s petition. 

I.

The Federal Service Labor-Management Relations Statute

(FSLMRS or Statute), 5 U.S.C. §§ 7101-7135, “establishes a

collective bargaining regime in the federal public sector.” Ass’n

of Civilian Technicians v. FLRA, 353 F.3d 46, 49 (D.C. Cir.

2004) (citingUnited States Dep’t of the Navy v. FLRA, 952 F.2d

1434, 1438 (D.C. Cir. 1992)). This controversy involves the

Statute’s management rights doctrine codified in section 7106.

See 5 U.S.C. § 7106. While the Statute generally obligates an

agency to negotiate with its employees’ bargaining

representative over “conditions of employment,” id.

§ 7103(a)(12)—i.e., “personnel policies, practices, and matters

. . . affecting working conditions,” id. § 7103(a)(14)—section

7106 “reserv[es] to management officials the authority to, inter

alia, make budget, organization, and work assignments.”2 FLRA

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(B) to assign work, to make determinations with

respect to contracting out, and to determine the

personnel by which agency operations shall be

conducted;

(C) with respect to filling positions, to make

selections for appointments from--

(i) among properly ranked and certified

candidates for promotion; or

(ii) any other appropriate source; and

(D) to take whatever actions may be necessary to

carry out the agency mission during emergencies.

(b) Nothing in this section shall preclude any agency

and any labor organization from negotiating--

(1) at the election of the agency, on the numbers,

types, and grades of employees or positions assigned

to any organizational subdivision, work project, or

tour of duty, or on the technology, methods, and

means of performing work;

(2) procedures which management officials of the

agency will observe in exercising any authority under

this section; or

(3) appropriate arrangements for employees adversely

affected by the exercise of any authority under this

section by such management officials.

5 U.S.C. § 7106.

v. United States Dep’t of Justice, 994 F.2d 868, 871-72 (D.C.

Cir. 1993). Nonetheless, these rights of unilateral action, which

are permissive subjects of bargaining, see Nat’l Treasury

Employees Union v. FLRA, 399 F.3d 334, 340 & n.5 (D.C. Cir.

2005), are not unqualified. An agency exercises management

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rights subject to bargaining over the “impact and

implementation” of the rights. Dep’t of the Navy v. FLRA, 962

F.2d 48, 50 (D.C. Cir. 1992). “Nothing in this section,” the

Statute says, “shall preclude any agency and any labor

organization from negotiating” over either “procedures which

management officials of the agency will observe in exercising

any authority under this section . . . or 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)(2)-(3). Thus, “although an agency is not

required to bargain with respect to its management rights per se,

it is required to negotiate about the impact and implementation

of those rights.” Dep’t of the Navy, 962 F.2d at 50 (internal

quotation marks omitted & emphasis in original). Under the

Statute, all bargaining must be carried out in “good faith.” Id.

§ 7114(a)(4), (b). 

The distinction between an agency’s exercise of management

rights and its obligation to engage in impact and implementation

bargaining is the crux of this controversy, which has its genesis

in Customs’ revised policy governing the assignment of

Customs inspectors to tours of duty and overtime work known

as the National Inspection Assignment Policy (NAIP). Customs

and the NTEU, which represents “a nationwide unit” of Customs

Service employees, including Customs inspectors, have

negotiated a series of national level collective bargaining

agreements (NLAs). The most recent NLA (and the one the

parties were abiding by when this dispute arose) expired in

1999. 

In 1993, the Congress passed the Customs Officers Pay

Reform Act (COPRA), which overhauled the overtime system

applicable to Customs inspectors. See Pub. L. No. 103-66,

§ 13811(a), 107 Stat. 312 (1993) (codified at 19 U.S.C. § 267).

To implement COPRA, that same year Customs and the NTEU

formed a joint labor-management committee, whose work

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culminated, two years later, with the NIAP. See J.A. 272. The

NIAP was developed independently of the 1999 NLA. 

At the time the NIAP was formulated, Customs, along with all

other federal agencies, was required under Executive Order

12871 to negotiate over the permissive subjects of bargaining set

forth in section 7106(b)(1) of the FSLMRS. See 58 Fed. Reg.

52,201 (Oct. 1, 1993). Section 7106 identifies the subjects as

“the numbers, types, and grades of employees or positions

assigned to any organizational subdivision, work project, or tour

of duty, or on the technology, methods, and means of

performing work.” 5 U.S.C. § 7106(b)(1). In 2001, however,

President George W. Bush revoked Executive Order 12871 by

issuing Executive Order 13203. See 66 Fed. Reg. 11,227 (Feb.

17, 2001).

Following Executive Order 13203, Customs advised the

NTEU that it no longer intended to negotiate over permissive

subjects of bargaining as previously required by article 5,

section 2, of the NLA. In that section of the NLA, Customs

agreed, “[i]n the interest of partnership, . . . to bargain with the

Union over the numbers, types and grades of employees or

positions assigned to any Customs Service organizational

subdivision, work project or tour of duty, and the technology,

methods and means of performing work within the Service.”

J.A. 273. Customs further advised the NTEU that it no longer

considered itself bound by provisions of agreements—including

the NLA and the NIAP—relating to permissive subjects of

bargaining. Customs transmitted to the NTEU a draft of a

revised NIAP that it planned to implement on September 30,

2001. 

A correspondence battle ensued during August and September

of 2001, only the salient aspects of which we recount now. On

August 6, the NTEU invoked its right to bargain over the impact

and implementation of the revised NIAP and served notice of its

intent to renegotiate the expired NLA. Customs responded on

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August 16 by repeating its planned implementation of the

revised NIAP on September 30, 2001. The following day, the

NTEU iterated its intent to “open the entire term agreement,”

highlighting various provisions which, it claimed, bore a “direct

connection” to the NIAP and to its section 7106 rights. On

August 22, Customs informed the NTEU that it was prepared to

“work out” ground rules to govern renegotiation of the expired

NLA but that, as to the proposed revised NIAP, Article 37 of the

expired NLA “establishes standard ground-rules for the

negotiation of interim topics such as the revised NIAP.” J.A.

46-47. The NTEU replied the next day, stating that “actual

negotiations” could not begin on any topic “until the parties

have reached agreement on ground rules.” J.A. 47A. On

August 27, Customs again declared that the ground rules set

forth in Article 37 of the expired NLA governed negotiations

over the revised NIAP. 

On August 29, Customs and the NTEU met to discuss ground

rules but to no avail. They exchanged correspondence the

following day: Customs stated it did not “agree to merge,” as the

NTEU had proposed, negotiations over the revised NIAP with

those regarding the expired NLA, while the NTEU said it

“continues to believe that concerns associated with” the NIAP

“should be addressed as part of the overall negotiations” on the

expired NLA. J.A. 53-54. In its letter, the NTEU also proposed

that the existing NIAP be “rolled-over,” subject to a few

specified revisions. J.A. 55. Customs responded that it did not

intend to delay the implementation of the revised NIAP until the

parties renegotiated the NLA. On September 6, 2001, Customs

had the last word in this exchange: It notified the NTEU that any

delay in implementing the revised NIAP “is unacceptable” and,

consequently, it “decline[d] to accept the NTEU’s suggestion

that [it] forego revision and implementation of the NIAP in

order to address it during renegotiation of the national

agreement.” J.A. 56-57. 

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3 The mediator did not break the impasse and on September 21,

2001, the NTEU requested assistance from the Federal Service

Impasse Panel, which ultimately declined to exercise jurisdiction over

the dispute. 

Believing the parties had reached an impasse over its proposal

to negotiate the NIAP and NLA simultaneously, the Union

sought assistance from the Federal Mediation and Conciliation

Service the day it received Custom’s last letter.3 Customs

proceeded to implement the revised NIAP on October 1, 2001,

insisting in a letter to the NTEU that day that, in light of new

requirements imposed after the catastrophic attacks by foreign

terrorists against our nation’s citizens on September 11, 2001,

immediate implementation was “critical . . . to ensure the

necessary functioning of Customs.” J.A. 65. The Union

responded with a letter of its own and also filed a grievance with

the Authority alleging that, by implementing the revised NIAP,

Customs violated section 7116(a)(1) and (5) of the FSLMRS.

Following submission of the Union’s grievance to arbitration, an

arbitrator concluded that the parties should bargain over

revisions to the NIAP and, consequently, remanded the matter

for the parties to negotiate the impact and implementation of the

revised NIAP. Both parties filed exceptions to the arbitrator’s

award with the Authority—Customs to the award itself, the

NTEU to the arbitrator’s choice of remedy. 

The Authority granted Customs’s exceptions and set the award

aside. See Customs Order, 59 FLRA at 708-11. At the outset of

its analysis, the Authority observed that, because Customs had

“proposed a specific change in unit employees’ conditions of

employment pursuant to the exercise of its management rights

under § 7106 of the Statute while the parties were contemplating

negotiation of a new term agreement,” the case presented an

issue of first impression. Id. at 708. Resolution of the case, it

said, turned on Customs’s “legal ability, if any, to refuse to

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bargain over the [NTEU]’s proposed ground rule requiring

[Customs] to combine its proposed impact and implementation

bargaining obligation with the negotiation of a term agreement.”

Id. Two possible answers, the Authority observed, carried two

different consequences for Customs. See id. On the one hand,

if Customs could refuse to bargain over the NTEU’s proposed

ground rule, it explained, “the Union’s refusal to engage further

in impact and implementation bargaining would permit

[Customs] to unilaterally implement its proposed change to

conditions of employment.” Id. If, on the other hand, Customs

was required to bargain over the proposed ground rule, Customs

“would commit an unfair labor practice by its unilateral

implementation of the revised NIAP.” Id.

The Authority chose the first answer, finding that “the Union’s

proposed ground rule constitutes a permissive subject of

bargaining and, consequently, that the Agency was under no

obligation to bargain on that subject as a precondition to impact

and implementation of the revised NIAP.” Id. In articulating

the basis of its decision—i.e., “that an agency cannot be

compelled to bargain over combining impact and

implementation and term bargaining and it has the right to insist

that such bargaining proceed on separate tracks”—the Authority

delineated two principles. Id. First, it noted that “[w]here an

agency action constitutes the exercise of a management right”

under sections 7106(a) and 7106(b)(1) of the FSLMRS, its

“obligation is limited to bargaining over the procedures

governing the exercise of the right, under § 7106(b)(2) of the

Statute, or appropriate arrangements for employees adversely

affected by the exercise of the right, under § 7106(b)(3).” Id.

Second, relying on our decision in FLRA v. United States Dep’t

of Justice, 994 F.2d 868 (D.C. Cir. 1993), the Authority

observed that, because an agency exercising a management right

need not bargain over matters beyond the scope of impact and

implementation bargaining, its “duty to bargain over ground

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rules must be consistent with the parties’ obligation to bargain

in a particular case.” Id. at 709. 

After finding that the NTEU’s right to bargain “was limited to

the impact and implementation of the proposed changes in the

revised NIAP,” id. at 711; see also id. at 708, because

implementation of the revised NIAP involved the exercise of a

statutory management right, the Authority then considered

whether the NTEU’s “proposed ground rule addresse[d] only

procedures or appropriate arrangements relating to the change

in conditions of employment proposed” by the revised NIAP.

Id. at 710. “Clearly, it does not,” the Authority concluded,

because “[b]ased on the record, there is no question but that

bargaining over a new term agreement would extend beyond the

narrow scope of issues related to the procedures and appropriate

arrangements governing implementation of the revised NIAP.”

Id. While it acknowledged that the NTEU “identified provisions

of the NLA that related to the NIAP that it wished to discuss in

term negotiations,” the Authority found that “it also demanded

to bargain over other, unrelated provisions of the NLA as well.”

Id. Therefore, the Authority concluded, because the “Union

proposed, as a condition precedent to bargaining over the impact

and implementation of the revised NIAP, that [Customs] agree

to bargain that matter as a part of bargaining over a new term

agreement,” the Union’s ground rule “exceeded the scope of

impact and implementation bargaining and [Customs] had no

obligation to bargain over [it].” Id.

The Authority additionally explained that, because the

proposed ground rule sought in effect a waiver of Customs’s

right to bargain only over those procedures and arrangements

related to the revised NIAP, it constituted a “permissive subject

of bargaining.” Id. at 710. Consequently, in the Authority’s

view, Customs had the “right not only to refuse to bargain to

impasse over the matter, but also to implement the revised NIAP

without completing bargaining.” Id. Therefore, the Authority

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4 Member Pope concurred in the judgment but declined to join the

majority opinion because, as she saw it, “the problem with the

proposed ground rule . . . was that it sought to combine bargaining

over unrelated provisions in the term agreement with impact and

implementation bargaining.” Id. at 712. “[I]f the Union had limited

its bargaining request to related, mandatory provisions of the term

agreement,” she asserted, Customs “would have been required to

bargain over these provisions prior to implementing the change.” Id.

She also disagreed with the majority’s conclusion that the NTEU’s

proposed ground rule sought a waiver of Customs’ right to bargain

only over procedures and appropriate arrangements regarding the

revised NIAP. See id. “This case,” she claimed, “is about bargaining

over unrelated matters; waiver has nothing to do with it.” Id.

concluded, Customs did not violate the FSLMRS by

implementing the revised NIAP on October 1, 2001. See id.

The Authority further reasoned that a contrary rule—i.e., one

“requiring agencies to bargain [over] a ground rule conditioning

impact and implementation bargaining on the negotiation of a

term agreement,”—would, to its mind, “frustrate the

compromise reached by Congress in enacting § 7106.” Id.

(emphasis in original). Such a rule “would not,” the Authority

explained, “give full effect to the place of management rights in

the statutory scheme because it would tie the exercise of a right

to objectives that have nothing to do with the purposes for which

the right was being exercised.” Id. Indeed, the Authority

observed, “it would be exceedingly anomalous if a union could

achieve through ground rules bargaining an expansion of

negotiations that it could not accomplish through bargaining

over procedures and appropriate arrangements.” Id. at 711.

Because Customs’ “implementation of the revised NIAP, in

the face of a proposal over which it was not obligated to bargain,

was, therefore, not a violation of the Statute,” the Authority

concluded that the arbitrator erred as a matter of law in deciding

otherwise and set his award aside. 4 Id. The NTEU then timely

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filed a petition for review pursuant to 5 U.S.C. § 7123(a). 

II. 

We begin with the standards by which we review the

Authority’s order. First, there is the familiar Administrative

Procedure Act standard, see 5 U.S.C. § 7123(c) (incorporating

5 U.S.C. § 706): “[W]hen acting ‘within its authority’ and

‘consistent with the congressional mandate,’ the Authority’s

decision may only be set aside if it is found to be ‘arbitrary,

capricious, an abuse of discretion, or otherwise not in

accordance with law.’ ” Ass’n of Civilian Technicians v. FLRA,

250 F.3d 778, 782 (D.C. Cir. 2001) (quoting 5 U.S.C. §

706(2)(A); Bureau of Alcohol, Tobacco & Firearms v. FLRA,

464 U.S. 89, 97 & n.7, 98 & n.8 (1983)); see also AFGE Local,

2343 v. FLRA, 144 F.3d 85, 88 (D.C. Cir. 1998). In addition

there is the classic two-step methodology governing the

Authority’s interpretation of the Statute: If the Congress “has

directly spoken to the precise question at issue,” the court

“give[s] effect to [its] unambiguously expressed intent,” but if

the statute is silent or ambiguous the court defers to the

Authority’s interpretation so long as it is “based on a permissible

construction of the statute.” Chevron USA Inc. v. Natural Res.

Def. Council, Inc., 467 U.S. 837, 842-43 (1984); see also Dep’t

of the Air Force v. FLRA, 294 F.3d 192, 196 (D.C. Cir. 2002).

These standards are deferential ones, for, as the Supreme Court

has reminded us, the Authority—not this court—is the expert on

federal labor relations. Because “the Authority’s function is ‘to

develop specialized expertise in its field of labor relations and

to use that expertise to give content to the principles and goals

set forth in the Act,’ . . . it ‘is entitled to considerable deference

when it exercises its “special function of applying the general

provisions of the Act to the complexities” of federal labor

relations.’ ” Nat’l Fed’n of Fed. Employees v. Dep’t of the

Interior, 526 U.S. 86, 99 (1999) (quoting Bureau of Alcohol,

Tobacco & Firearms, 464 U.S. at 97 (in turn quoting NLRB v.

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Erie Resistor Corp., 373 U.S. 221, 236 (1963))). The

application of these deferential standards of review is fatal to

NTEU’s two arguments, each of which we take up—and

reject—in turn. 

The NTEU’s opening attack is on the Authority’s conclusion

that Customs exercised its statutory management rights in

proposing revisions to the NIAP. According to the NTEU, the

Authority’s “erroneous premise” falls apart once it is recognized

that the proposed revisions altered “pre-existing negotiated

procedures and appropriate arrangements,” a topic outside

Customs’ statutory management rights and therefore within

Customs’ duty to bargain. Petitioner’s Br. at 32. That is, in the

NTEU’s words: “[W]hen Customs proposed to replace the

negotiated procedures and appropriate arrangements of [the

NIAP] with new procedures and appropriate arrangements . . .

it was proposing a change in conditions of employment over

which it had a substantive obligation to bargain.” Petitioner’s

Br. at 34. 

The NTEU’s Chevron step-one argument—i.e., that the

Authority mischaracterized the implementation of the NIAP as

the exercise of a management right rather than as a bargainable

change to appropriate arrangements and procedures—is a nonstarter at best. The NTEU is right that the language and

structure of section 7106 manifest a “deliberate distinction”

between an agency’s management rights, on the one hand, and

matters subject to bargaining on the other. Petitioner’s Br. at

33. The language of the statute does indeed qualify the

management rights: The phrase “nothing . . . shall affect the

authority of any management official of any agency” begins

subsection (a), while the provision that “[n]othing . . . shall

preclude any agency and any labor organization from

negotiating” introduces the matters set forth in subsection (b).

5 U.S.C. § 7106(a)-(b). Subsection (b), moreover, identifies

two subjects of mandatory negotiation: “procedures which

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management officials of the agency will observe in exercising

any authority under this section,” id. § 7106(b)(2), and

“appropriate arrangements for employees adversely affected by

the exercise of any authority under this section by such

management officials,” id. § 7106(b)(3). The distinction

between management rights and negotiable matters is further

reinforced by the statute’s structure, which (with the exception

of subsection (b)(1)) divides management rights from the

negotiable matters by placing them in different subsections,

compare id. § 7106(a), with id. § 7106(b)(2)-(3)—a division

highlighted by the statute’s command that actions under

subsection (a) be taken “[s]ubject to” subsection (b). Id.

§ 7106(a). But the NTEU’s insistence that Customs’ subsection

(a) management rights must be exercised “[s]ubject to”

subsection (b)(2) procedures and subsection (b)(3) appropriate

arrangements does little to advance its argument, the gravamen

of which is that the Authority wrongly concluded that Customs’

revision constitutes the exercise of management rights rather

than the alteration of procedures and arrangements by which it

exercises those rights. In other words, it does not, as the NTEU

contends, “follow necessarily” from either the statutory

structure or text that the NIAP falls into section 7106’s

negotiable procedures and arrangements category rather than

the management rights category. 

The gist of NTEU’s argument on this point appears to be

based on its view that “it is clear that several significant

provisions of the NIAP had no relationship whatsoever to the

exercise of any management right,” a view it supports by citing

various “procedures and appropriate arrangements that the

parties had previously negotiated to govern the exercise of

Customs’s authority to assign work” resulting from the

revisions. Petitioner’s Br. at 32. The Authority, however,

reached a contrary conclusion. The NIAP involves management

rights, it said, because its review of the revised NIAP

“indicate[d] that the revised NIAP constitutes, among other

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things, criteria governing employee work assignments, under

§ 7106(a)(2)(B) of the Statute, and staffing patterns, under

§ 7106(b)(1).” Customs Order, 59 FLRA at 708 n.16. While

the Authority’s analysis is unquestionably terse, its

characterization is borne out by the administrative record. The

revised NIAP specifically provides that management decisions

pertaining to, inter alia, scheduling, staffing levels and overtime

are to be governed by “operational needs” and “budgetary

limitations.” J.A. 30-32. We have, in the past, recognized that

the specification of “criteria pursuant to which substantive

decisions are to be made,” such as, in this case, “operational

needs” and “budgetary limitations,” comes within the exercise

of management rights. See Dep’t of Treasury v.FLRA, 857 F.2d

819, 821 (D.C. Cir. 1988). We do so again with respect to the

revised NIAP. 

The NTEU also argues that, in concluding the revised NIAP

implicates management rights, the Authority departed from an

earlier decision—United States Dep’t of Treasury, Customs

Serv. Region IV, Miami Dist., Miami, Fla. (Respondent) &

Nat’l Treasury Employees Union (Charging Party), 38 FLRA

838 (1990) (Miami Customs)—without explanation. Miami

Customs, according to the NTEU, “demonstrates that Customs

was obligated to bargain over the substance of its decision to

revise [the] NIAP, not merely its impact and implementation.”

Petitioner’s Br. at 34. We do not agree. In Miami Customs, the

Authority held that the Miami District Customs Service

violated the FSLMRS in implementing a new rotation system

after refusing to bargain over a negotiable union proposal

addressing the length of an inspector’s time on a given

assignment. See Miami Customs, 38 FLRA at 844. Unless a

proposal involving the right to assign work directly interferes

with the exercise of a management right, the Authority

explained, it is negotiable. See id. at 842. Accordingly,

because “proposals which address only the length of an

assignment within such a rotation schedule do not interfere with

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5 The NTEU also maintains that Customs was obligated under

Authority precedent to bargain over its proposed ground rule because

it was offered in good faith and designed to advance—not

impede—the bargaining process. See Petitioner’s Br. at 39-46. The

Authority responds that the NTEU waived this argument. See

Respondent’s Br. at 31 n.11. Although the NTEU offered record

citations purporting to refute the Authority’s charge, see Petitioner’s

Rep. Br. at 11-12 n.6, it failed to provide us with the cited pages until

after we directed it to do so at oral argument. See Letter from Elaine

Kaplan, Senior Deputy General Counsel, to Mark Langer, Clerk of

D.C. Circuit Court of Appeals, at 1 (Feb. 8, 2004). Our review of its

subsequent submission convinces us that the NTEU has indeed waived

this argument because it appears nowhere in the cited pages—or the

eight additional unsolicited pages the NTEU submitted with them. See

5 U.S.C. § 7123(c) (“No objection that has not been urged before the

the management’s right to assign work,” the Miami District

Customs Service was obligated to bargain over the union’s

proposal. Id. at 843. Nothing in Miami Customs at all

undermines the Authority’s conclusion that Customs’

specification in the revised NIAP of substantive criteria

governing management decisions pertaining to scheduling,

staffing and overtime was the exercise of a management right

and therefore not a matter over which Customs had a

mandatory duty to bargain under the Statute. 

We find the NTEU’s next argument—i.e., even assuming that

Customs exercised its management rights in implementing the

revised NIAP, it was nevertheless obligated to bargain over the

proposed ground rule regarding the timing of bargaining over

both the NIAP and a new NLA—wanting as well. The

Authority’s conclusion in this regard, the NTEU maintains,

stems from a misapplication of the analysis we outlined in FLRA

v. United States Dep’t of Justice, 994 F.2d 868 (D.C. Cir. 1993),

to its ground rule proposal and produces “an anomalous result

that undermines the statutory purposes.”5 Petitioner’s Br. at 50.

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Authority . . . shall be considered by the court.”); Dep’t of Treasury v.

FLRA, 707 F.2d 574, 579 (1983) (“[W]e cannot review issues that an

agency never placed before the Authority.” (emphasis in original));

see also Equal Employment Opportunity Comm’n v. FLRA, 476 U.S.

19, 23 (1986). The NTEU is a frequent litigant in our court and its

counsel is cautioned against attempting to lead us astray in the future.

Not so. Because it constitutes a reasonable interpretation of the

mutual statutory duty to bargain in good faith, see 5 U.S.C

§ 7114(a)(4), (b), we uphold the Authority’s conclusion that

Customs was not obligated to bargain over a ground rule

proposal that is inconsistent with the parties’ specific obligation

to bargain in this case—that is, in the Authority’s words, one

that “exceeded the scope of impact and implementation

bargaining.” Customs Order, 59 FLRA at 810. 

First, we cannot say the Authority misapplied our Dep’t of

Justice decision here. There, we addressed a petition for

enforcement of an Authority order requiring the San Diego

Border Patrol to bargain over the impact and implementation of

a relocation of employees to various locations in San Diego

County. See Dep’t of Justice, 994 F.2d at 870-72. We held that

the Border Patrol did not violate the FSLMRS in refusing to

bargain over the union’s proposal to use the vacated space

resulting from the relocation. See id. at 873. We explained that

“the term ‘impact and implementation’ includes only the

procedures which management officials of the agency will

observe in exercising management rights and appropriate

arrangements for employees adversely affected by the exercise

of such rights.” Id. at 872 (further internal quotation marks &

citations omitted). The “disputed subject matter” did not “fit[]

within either of those subsets,” we concluded, because it was

“clear that the creation of an office for the Union has nothing to

do with the procedures used by management for the resource

and personnel allocation involved in the decentralization of the

unit.” Id.

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Here, the Authority’s conclusion that the “limitation on the

scope of impact and implementation bargaining” in Dep’t of

Justice is “no different when the question . . . concerns an

agency’s obligation to bargain over the ground rules for

negotiating over the impact and implementation of an exercise

of a management right,” Customs Order, 59 FLRA at 709,

derives from our declaration in Dep’t of Justice that a

“ ‘proposal must address adverse effects flowing from the

exercise of a protected management right.’ ” 994 F.2d at 872

(quoting & citing United States Dep’t of Treasury v. FLRA, 960

F.2d 1068, 1073 (D.C. Cir. 1992)). As the Authority

recognized, it “would be exceedingly anomalous” if the NTEU

could use a ground rule proposal to expand the scope of

negotiations beyond that of impact and implementation

bargaining itself. Customs Order, 59 FLRA at 711.

Furthermore, we cannot help but note that the Authority’s

interpretation is wholly consistent with other precedent. Its

observation fifteen years ago that “ground rules proposals must,

at a minimum, be designed to further, not impede, the

bargaining for which the ground rules are proposed,” United

States Dep’t of the Air Force Headquarters, Air Force Logistics

Command, Wright-Patterson Air Force Base, Ohio

(Respondent) & AFGE, Council 214 (Charging Party), 36

FLRA 524, 533 (1990) (emphasis added), is simply another way

of stating that “the duty to bargain over ground rules must be

consistent with the parties’ obligation to bargain in a particular

case.” Customs Order, 59 FLRA at 709. 

Moreover, the Authority’s interpretation of the mutual

statutory duty to bargain in good faith makes sense even without

resort to supporting precedent. Notwithstanding the NTEU’s

contrary characterization, the Authority did not conclude that an

agency is never obligated to bargain over a ground rule proposal

to combine negotiations; rather, it held only that Customs was

under no such duty to do so in this instance because the NTEU’s

“proposed ground rule exceeded the scope of impact and

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implementation bargaining.” Customs Order, 59 FLRA at 710.

The Authority’s holding, as it noted, advances statutory

objectives we also recognize. In the past, we have stated that

“[b]y ascribing certain management rights to agencies, but

tempering those rights through the requirements of impact and

implementation bargaining” the Congress balanced “the

agency’s need to manage itself efficiently and the employees’

right to participate in the decisions that affect them.” Dep’t of

the Navy, 962 F.2d at 50 n.1. We described the balance as a

“delicate” one, id., and we think the Authority reasonably

determined that the balance would be upset if the NTEU could

use a ground rule proposal to require Customs to negotiate on

matters unrelated to the impact and implementation of the

revised NIAP. Not only would the inevitably resulting delay in

implementing the revised NIAP frustrate the Statute’s “larger

goal of promoting ‘an effective and efficient government,’ ”

Dep’t of Treasury, 857 F.2d at 822 (quoting & citing 5 U.S.C.

§ 7101(b)), but requiring Customs to bargain over such a

proposal would diminish the role of management rights in the

statutory scheme by conditioning their exercise on bargaining

over matters having nothing to do with the exercise of the rights

themselves. Cf. Dep’t of Justice, 994 F.3d at 872 (To fall within

subparagraph(b)(3) “proposal must address adverse effects

flowing from the exercise of a protected management right.”).

Because it is clear to us, as it was to the Authority, that

bargaining over the terms of a new NLA would necessarily

extend further and take longer than bargaining over the impact

and implementation of Customs’ revised NIAP, we conclude

that the Authority reasonably upheld both the Customs’ refusal

to consider NTEU’s proposal to bargain over the two matters

simultaneously as well as Customs’ implementation of the

revised NIAP. 

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* * *

For the foregoing reasons, we deny the NTEU’s petition for

review.

So ordered.

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