Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-07-01422/USCOURTS-caDC-07-01422-0/pdf.json

Parties Involved:
Association of Civilian Technicians, Puerto Rico Army Chapter
Petitioner
Federal Labor Relations Authority
Respondent

Document Text:

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

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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.

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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

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We further found that FLRA had failed to explain adequately its

rejection of ACT’s contention that “the reimbursements are implicitly

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

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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)).

“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

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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,

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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.

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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.”

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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

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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.

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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.

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