United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 11, 2005 Decided April 15, 2005

No. 04-1157

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. On

the briefs were Gregory O'Duden, Larry J. Adkins, and Caryl

L. Casden.

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: EDWARDS, SENTELLE and ROBERTS, Circuit Judges.

Opinion for the Court filed by Circuit Judge SENTELLE.

Concurring opinion filed by Circuit Judge ROBERTS.
2

SENTELLE, Circuit Judge: National Treasury Employees

Union (“NTEU” or “the Union”) petitions for review of a

decision of the Federal Labor Relations Authority (“FLRA” or

“the Authority”), wherein the Authority held that the United

States Customs Service (“Customs” or “the Service”) is not

required to negotiate over a Union proposal concerning the

storage of handguns. Although the Authority correctly ruled

that the proposal came within the exemption of negotiability for

“internal security practices” created by 5 U.S.C. § 7106(a)(1),

the Authority erred in failing to follow its own precedent in

determining whether the bargaining proposal constituted an

“appropriate arrangement” subjecting it to bargainability under

5 U.S.C. § 7106(b)(3). Therefore, for the reasons more fully set

out below, we grant the petition for review. 

I. Background

Petitioner Union represents Customs Service employees

who, as a condition of their employment as law enforcement

officers, are required to carry firearms. Customs employees

have carried firearms as a part of their duties for many years,

and over the years Customs has promulgated a number of

internal security practices relating to the use and storage of those

firearms. In 1986, Customs Directive No. 45-07 (Feb. 10, 1986)

required that “[e]ach Customs officer carrying a firearm in the

performance of official duties is responsible for the safe storage,

operation, general care and maintenance of the firearm.” In

1996, Customs issued a “Firearms and Use of Force Handbook,”

that again emphasized the individual employee’s responsibility

for securing his firearm: “Employees are expected to exercise

good judgment in providing adequate security to all Serviceissued and Service-authorized, personally-owned firearms.”

Finally, in 2000, Customs issued two policy statements on the

subject of firearms. On March 3, 2000, the Acting Assistant

Commissioner of Customs, Office of Field Operations, issued a
3

1At the time that this dispute began, the Service was part of

the United Sates Department of the Treasury. It was transferred to the

Department of Homeland Security pursuant to the Homeland Security

Act of 2002, Pub. L. No. 107-296, codified at 6 U.S.C. § 203(1).

Neither party suggests that this transfer affects any issue before this

Court.

memorandum authorizing customs agents, at their election, to

carry their firearms twenty-four hours a day. Prior to that time,

Customs had directed employees to store their firearms

overnight in the Customs facilities “where appropriate security

is available,” or to “go directly home from work” in order to

secure their firearms at home. Under the new twenty-four-hour

carry policy, the agency in effect decreased the burden on

employees by removing the requirement of travel directly to and

from home and work and giving them greater freedom of

movement, subject to such restraints as avoiding the

consumption of alcohol while carrying firearms.

On December 28, 2000, the Under Secretary of Treasury for

Enforcement1issued a memorandum on the subject

“Implementation of Treasury Firearm Safety and Security

Policy,” which detailed safety and security responsibilities

required of firearms-carrying personnel. Among other things,

the memorandum required that the firearm be placed in a secure

locked container in a government office, or, if stored in a

residence, that the employee install a safety lock device and

guard against theft or unauthorized use of the firearm. 

In response to the December 28, 2000 memorandum, the

Union introduced a proposal that would have required Customs

to provide secure on-site overnight firearms storage:

Customs will ensure that either a lockbox or other secure

and locked container such as a safe, file cabinet, or desk is
4

available at all government offices where armed employees

work or are assigned. Routine overnight storage of a

firearm in a government office is permitted. 

NTEU v. US Dep’t of the Treasury, US Customs Service, 59

F.L.R.A. 749 (2004). Customs declared the proposal

nonnegotiable. The Union filed a petition for review with the

Authority. The Authority held that the proposal interfered with

Customs’s right to determine its “internal security practices”

under 5 U.S.C. § 7106(a)(1) and also that the proposal did not

constitute a “procedure” or an “appropriate arrangement” under

5 U.S.C. §§ 7106(b)(2) & (3). Together, these holdings

constitute the Authority’s ruling that the proposal is

nonnegotiable. The Union petitioned us for review.

II. Analysis

The Federal Service Labor Management Relations statute,

5 U.S.C. §§ 7101-7135 (“the statute”), governs relations

between federal agency employers and federal employees. The

statute imposes a general duty upon the parties to bargain in

good faith, 5 U.S.C. § 7117, subject to specified statutory

exceptions. The Authority ruled that the proposal before it came

within one of those exceptions. Specifically, the Authority

relied upon the “management rights” section of the statute,

which protects the authority of management officials and

agencies, inter alia, “to determine the . . . internal security

practices of the agency.” 5 U.S.C. § 7106(a)(1). However, the

management rights section limits that protection by providing

that “[n]othing in this section shall preclude any agency and any

labor organization from negotiating . . . 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
5

U.S.C. § 7106(b)(2) & (3). The Authority went on to rule that

the proposal before it did not constitute a “procedure”

exempting the proposal from the management rights

negotiability preclusion under § 7106(b)(2), or an “appropriate

arrangement” exempting the proposal under § 7106(b)(3).

We review decisions of the Authority under the

Administrative Procedure Act (“APA”), and will set such a

decision aside when it is “arbitrary, capricious, an abuse of

discretion, or otherwise not in accordance with law[.]” Bureau

of Alcohol, Tobacco and Firearms v. FLRA, 464 U.S. 89, 97 n.7

(1983). We will apply that standard of review to each step of

the Authority’s decision. 

First, the Authority concluded that the Service had

established a link between its objective of securing its operations

and its policy or practices, and that the proposal conflicted with

its policy or practices. Therefore, the Authority held that the

proposal affected management’s right to determine its internal

security practices under § 7106(a)(1). 59 F.L.R.A. at 753-54

(citing Fraternal Order of Police, Lodge 1-F, 51 F.L.R.A. 143,

145 (1995) (“Lodge 1-F”)).

Second, the Authority concluded that the proposal required

adoption of security measures to ensure a specific level of

security. Therefore, the Authority held that the proposal was not

a negotiable procedure under Section 7106(b)(2). Id. at 754

(citing NFFE Local 1482, 44 F.L.R.A. 637, 648 (1992)). 

With respect to Sections 7106(a)(1) and 7106(b)(2), the

Authority’s decision quite clearly was not arbitrary or

capricious. Storage of firearms at Service facilities certainly

implicates management’s right to determine its internal security

practices. 5 U.S.C. § 7106(a)(1). Likewise, because the

proposal would directly interfere with management’s right to
6

determine its internal security practices by forcing the Agency

to commit to a change in its current security practices, the

proposal is simply not a negotiable procedure. 5 U.S.C. §

7106(b)(2); AFGE v. Air Force Logistics Command, 2 F.L.R.A.

604, 612-13 (1980), aff’d sub nom. Dep’t of Defense v. FLRA,

659 F.2d 1140, 1159 (D.C. Cir. 1981).

However, the Authority and the court still are left with the

question of whether the proposal constituted a negotiable

“appropriate arrangement” under § 7106(b)(3). The Authority’s

conclusion on that subject is not so unassailable as the first two.

Authority precedent established nearly twenty years ago holds

that:

In this and future cases where the Authority addresses a

management allegation that a union proposal of appropriate

arrangements is nonnegotiable because it conflicts with

management rights described in section 7106(a) or (b)(1),

the Authority will consider whether such an arrangement is

appropriate for negotiation within the meaning of section

7106(b)(3) or, whether it is inappropriate because it

excessively interferes with the exercise of management’s

rights.

Nat’l Assoc. of Gov’t Employees, Local R14-87 v. Kansas Army

Nat’l Guard, 21 F.L.R.A. 24, 31 (1986) (“KANG”) (emphasis

added). More specifically, the KANG test asks first what “the

nature and extent of the impact experienced by adversely

affected employees . . . is.” 21 F.L.R.A. at 32. Otherwise put,

the Authority determines “what conditions of employment are

affected and to what degree.” Id. If the effect is there so as to

raise the opportunity of an appropriate arrangement, the

Authority then asks “what is the precise limitation imposed by

the proposed arrangement on management’s exercise of its

reserved discretion or to what extent is managerial judgment
7

preserved?” Id. In the present context, to apply the KANG test

the Authority had to ascertain how the agency exercised its right

to determine its internal security practices so that the Authority

could then determine whether the proposal “excessively

interfere[d]” with the agency’s exercise of its right. In the

decision before us, the Authority did not follow its own

precedent established in KANG. See, e.g., Association of

Civilian Technicians v. FLRA, 370 F.3d 1214, 1221 (D.C. Cir.

2004) (vacating an Authority decision and directing application

of the KANG test on rehearing). 

It is well established that, despite the narrow scope of court

review of FLRA decisions, any agency’s “unexplained departure

from prior agency determinations” is inherently arbitrary and

capricious in violation of APA § 706(2)(A). American

Federationof Government Employees,Local2761v.FLRA, 866

F.2d 1443, 1446 (D.C. Cir. 1989). The Authority’s failure to

follow its own well-established precedent without explanation

is the very essence of arbitrariness. Therefore, we must set aside

its determination that the proposal did not constitute an

appropriate arrangement and return the question to the Authority

for further proceedings consistent with this opinion and

Authority precedent.

Under KANG, the Authority must conduct a so-called

“excessively interferes with” inquiry “by weighing the practical

needs of the employees and managers.” 21 F.L.R.A. at 31-32.

It did not do so on the present record. The Authority’s path to

error was set when it erroneously found that “the agency has

exercised its right to determine its internal security by having

employees who are trained and qualified to carry firearms

maintain possession and access to their weapons when off duty.”

59 F.L.R.A. at 754. That finding was crucial to the Authority’s

conclusion that the proposal “would operate so as to completely

preclude the agency from exercising that right.” In fact, the
8

record did not support the Authority’s description of the

agency’s security policy. On the record, the agency apparently,

in many locations, permitted on-site storage of firearms of offduty officers, and, indeed, provided facilities for such storage.

We are not suggesting that the Authority must rule that the

agency must make such arrangements in all locations, but only

that the Authority must consider the evidence in the record

before it, conduct the balanced inquiry required by the KANG

line of precedent, and then reach its conclusion as to whether the

proposal “excessively interferes” with the agency’s internal

security practices.

On the record before it and this Court, the Authority has not

established that the proposal would “negate and nullify” the

agency’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 agency internal security policies already in place at

some locations. Whether this constitutes an appropriate

arrangement is a question for the Authority to answer in the first

instance, but it must do so on findings based on the record

before it, and by a process consistent with its own precedent.

III. Conclusion

For the reasons set forth above, we hold that the petition for

review is allowed. The Authority’s order is vacated and

remanded for further proceedings consistent with this opinion.
ROBERTS, Circuit Judge, concurring: I agree with the court

that the Authority was not arbitrary and capricious in determining that the Union’s proposal implicated management’s right to

determine internal security practices, 5 U.S.C. § 7106(a)(1), and

was not a negotiable “procedure,” id. at § 7106(b)(2). The court

goes on to fault the Authority for finding that the proposal was

not an “appropriate arrangement,” id. at § 7106(b)(3), because

the Authority considered that question in light of the incorrect

premise that agency policy required all employees to take their

weapons home when off-duty.

The court is correct that this is not the agency policy, but it

is arguable that the Authority appreciated this fact. See, e.g., 59

F.L.R.A. at 753 (“The Agency has determined . . . that by not

allowing storage during off-duty periods at those facilities which

lack adequate security, it is reducing the risk of theft and

furthering its asserted internal security practice determinations.”) (emphasis added); id. at 755 (concluding that the

Union’s proposal “effectively overrid[es] the Agency’s internal

security determination regarding those employees working at

facilities and locations ill-equipped and unsuitable for off-duty

storage of firearms”) (emphasis added). At the same time, it is

difficult to fault the court’s reading, given that the agency itself

told the Authority below that agency “policy and practice . . .

never authorized routine overnight storage of issued firearms in

employees’ work locations.” Agency Statement of Position at 4.

Given all this, it is reasonable to read the Authority’s

analysis as the court does, and to find that analysis wanting. On

remand, the Authority must consider whether the Union’s

proposal is an “appropriate arrangement” in light of a correct

view of the agency’s policy. I join the court’s opinion on the

understanding that nothing in it precludes the Authority from

concluding on remand that the proposal to provide “a lockbox

or other secure and locked container” for overnight storage of

firearms “at all government offices where armed employees

work or are assigned,” 59 F.L.R.A. at 749 (emphasis added),

completely overrides or excessively interferes with a policy of
2

allowing overnight storage only when the agency determines

security at a particular location is adequate. Cf. id. at 755 n.5

(“The fact that the Agency provides overnight storage at some

locations also constitutes a determination by management that

security at those locations is safe and effective — itself an

exercise of the right to determine internal security practices.”).