Source: https://www.flra.gov/fsip/finalact/93fs_056.html
Timestamp: 2016-08-29 00:11:56
Document Index: 383028498

Matched Legal Cases: ['§ 7119', '§ 9701', '§ 2471', '§ 2471', '§ 9701', '§ 483']

DEPARTMENT OF VETERANS AFFAIRS WASHINGTON, D.C. AND VA NATIONAL COUNCIL, AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO Case No. 93 FSIP 056 | FLRA
You are hereHome DEPARTMENT OF VETERANS AFFAIRS WASHINGTON, D.C. AND VA NATIONAL COUNCIL, AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO Case No. 93 FSIP 056 DEPARTMENT OF VETERANS AFFAIRS WASHINGTON, D.C. AND VA NATIONAL COUNCIL, AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO
AND VA NATIONAL COUNCIL, AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES,
Case No. 93 FSIP 56
The Department of Veterans Affairs, Washington, D.C. (Employer
or VA) filed a request for assistance with the Federal Service
Federal Service Labor-Relations Statute (Statute), 5 U.S.C. § 7119,
between it and the VA National Council, American Federation of
determined that the dispute, which concerns mandatory participation
in the Employer's Direct Deposit/Electronic Funds Transfer (DD/EFT)
program for employees' pay, should be resolved through an informal
conference with a Panel representative. The parties were advised
that if no settlement were reached, the Panel's representative
would notify the Panel of the status of the dispute, including the
final offers of the parties, and would make recommendations for
resolving the impasse. After considering this information, the
The parties met with Senior Legal Advisor Jesse Etelson on
February 24, 1993, in Washington, D.C. During the informal
conference, the parties were unable to resolve the issues in
dispute. Mr. Etelson has reported to the Panel based on the
record developed by the parties, and it has considered the entire
record in the case. BACKGROUND
veterans and their beneficiaries. It maintains over 200 facilities
throughout the United States. The Union represents a consolidated unit of approximately 100,000 nonprofessional full-time, part-time,
and temporary employees working at these facilities. The Employer
has provided DD/EFT on a voluntary basis for a number of years. Employees who do not participate in the program voluntarily receive
paychecks either by mail to their homes or workplaces, or through
bulk mail to the workplace. The Employer has now proposed that
participation be mandatory, with a limited exemption for hardship.
The parties disagree over: (1) the criterion for exemption
from mandatory participation in the DD/EFT program and (2) the
option of paying a service charge to receive paychecks.
1.	Criterion for Exemption from Mandatory Participation
The Union proposes that current employees be granted
exemptions or waivers from participation in DD/EFT when
participation would cause inconvenience. Some employees are
viscerally opposed to mandatory DD/EFT for a variety of reasons. For example, privacy interests may be compromised if employees are forced to maintain bank accounts, given the degree of
confidentiality that existing laws and practices afford concerning
them. There is also a feeling of insecurity in the protection of deposits from financial institution failures. On the question of
relative costs, the Employer wishes to relieve itself of the burden
of delivering checks by burdening employees with having to maintain
bank accounts, with the attendant costs in money and inconvenience. Many employees are now able to conduct their financial affairs with
minimal expense by free check-cashing of Government checks at
convenient locations, such as grocery stores, and payment of bills
at other convenient establishments, making maintenance of a
checking account unnecessary.
Under the Employer's final proposal, current employees would
be required to participate in the DD/EFT program, but would be
granted exemptions or waivers for hardship. "Hardship" would include any situation where use of DD/EFT would result in greater
financial cost to the employee than he or she would incur to
conduct financial transactions if the employee did not participate
in the DD/EFT program (for example, costs for check cashing or
purchasing money orders to pay bills). Cost comparisons would be
made with any financial institution that is "accessible" to the
employee. The Employer's Fiscal/Finance Officers would assist
employees by negotiating with local financial institutions to allow
them to have their salary payments electronically transferred.
DD/EFT is financially advantageous to the VA and almost all
employees. Approximately 75 percent of the bargaining unit now
participates voluntarily. Because of the differences in cost to
deliver a paycheck to each of the 30,000 to 35,000 bargaining-unit
employees not participating at present, and the lesser cost ($.36
versus $.06) of a DD/EFT transfer, the VA would save approximately
$250,000 a year if all these employees participated. DD/EFT is
also more accurate. Its use substantially reduces the incidents of
failure of employees to receive their checks, in the correct
amount, and in a timely manner. Lost and undelivered checks are a
real problem in some locations. Moreover, when problems of failure
to receive payment arise, failures in the DD/EFT system can be
resolved in hours, and normally within 1 day, while replacing lost
checks takes several days. The Panel has already recognized the wisdom of mandatory
participation, with a provision for exemption or waiver, in
Department of the Air Force, Griffiss Air Force Base, Griffiss Air
Force Base, New York, 89 FSIP 206 (December 29, 1989), Panel
Release No. 289 (Griffiss). In that case, the Panel departed from
a position it took in some earlier cases in which it adopted
proposals permitting more than one method of delivery. The Panel
was persuaded that "the technology for [DD/EFT] transactions has
become more reliable, and should provide a more efficient and
economical system for pay delivery . . .," and took administrative
notice of "an increasing trend toward paperless paydays." The
agency's proposal in Griffiss, which the Panel adopted, provided
for a waiver for employees who could demonstrate "that
participation is not in their financial interest or would result in
personal hardship." The Employer's proposal in the instant case
reflects the same considerations.
The Employer should not be required, however, to maintain the
status quo until it negotiates with area banking institutions
certain conditions for the benefit of employee-depositors, such as
waiver of certain service charges, as was the agency in Griffiss. In this regard, Griffiss involved a local dispute affecting a single facility. The instant dispute is national in scope and
involves over 200 facilities. A prerequisite similar to that
imposed in Griffiss would require the Employer to negotiate with
nearly every financial institution in the U.S. The Employer's
proposal accomplishes the same purpose as the Griffiss requirement. It would give the Employer a powerful incentive to negotiate
favorable terms for employees with financial institutions
accessible to employees at each of its facilities, since the
absence of such favorable terms would give employees grounds to
request waivers because of the costs of establishing and
maintaining accounts, and of obtaining funds under various
circumstances. This part of the Employer's last proposal also
meets the Union's objection that requiring employees to maintain a
bank account may make it more expensive for them to receive their
pay via DD/EFT than to cash their paychecks and pay bills without
the necessity of maintaining an account. Finally, with respect to
"accessibility", most of the Employer's facilities have credit
unions on site.
Having considered the arguments on this issue, we conclude
that the parties should adopt the Employer's proposal, but with the
modification that "reasonably accessible" be substituted for
"accessible." "Reasonable accessibility" is to be determined
according to factors such as the distance and traveling time to a
financial institution from the employee's workplace or home, its
business hours, and the employee's ability to conduct normal and
routine business there without having to take leave. We believe
that the Employer's arguments on this issue are essentially sound,
and address the most significant concerns advanced by the Union. We find, however, that the concept of "accessibility" is too vague
without at least some guidelines for its application. 2.	Option of Paying Service Charge to Receive Paychecks
The Union proposes that those employees who choose not to
participate in DD/EFT may have the difference in cost between
electronic and the mailing expense automatically deducted from
their paychecks each pay period. Some employees would be willing,
if necessary, to retain the convenience and other perceived
benefits of receiving a paycheck, to reimburse the Government for
that service. If they prefer to do so, the Employer could realize
the same savings it seeks through mandatory participation and, at
the same time, accommodate the interests of these employees.
The Union's proposal is nonnegotiable and the Panel should not
consider it. Congress codified in what is now 31 U.S.C. § 9701 an
agency's authority to establish a charge or fee for services
provided. That section does not provide for a charge of the kind
proposed here. Absent other authorization to establish such a
charge, arguably the Employer may not do so. Moreover, it is
offensive to charge employees to receive their paychecks.
We have uncovered no impediment to the voluntary payments by
employees contemplated under the Union's proposal.(1) In our view,
requiring current employees to participate in the DD/EFT program is
in the public interest because of the considerable savings it would
generate. By the same token, we find that the adoption of the
Union's proposal constitutes a reasonable accommodation for those
relatively few non-participants who continue to value the current
means of receiving their paychecks. It should not affect in any
way the aforementioned savings to the Employer, and appears to be
only minimally administratively burdensome. We shall rephrase the
Union's proposal, however, to further reduce any administrative
costs that may be created by its implementation. Under this
modification, employees may choose not to participate in DD/EFT if
they make mutually agreeable arrangements to reimburse the Employer
for any additional cost to the Government of providing and
delivering a paycheck.
course of proceedings instituted pursuant to the Panel's
regulations, 5 C.F.R. § 2471.6 (a)(2), the Federal Service Impasses
Panel under § 2471.11(a) of its regulations hereby orders the
Exemptions or waivers will be granted when DD/EFT
delivery of salary payment would cause hardship to the
employee. "Hardship" includes any situation where use of
DD/EFT would result in greater financial cost to the
employee than he or she would incur to conduct financial
transactions if the employee did not participate in the
program. Cost comparison will be made with any financial
institution that is reasonably accessible to the
employee. "Reasonable accessibility" will be determined
according to factors such as the distance and traveling
time to a financial institution from the employee's
workplace or home, its business hours, and the employee's
ability to conduct normal and routine business there
without having to take leave from employment.
2.	Option of Paying Service Charge to Receive Paychecks
Employees may choose not to participate in DD/EFT if they
make mutually agreeable arrangements to reimburse the
Department for the additional cost to the Government of
providing and delivering a paycheck.
1. /	The Employer seems to be arguing that, because 31 U.S.C.
§ 9701 does not specifically authorize a charge for delivery
of paychecks, such a charge must be outside the contemplation
of that section. The United States Court of Appeals for the
District of Columbia Circuit, however, has held that this statutory
provision (formerly codified at 31 U.S.C. § 483a) was enacted to
allow agencies to recoup costs from identifiable "special
beneficiaries" where the services rendered inured to the benefit of
special recipients and not the general public. New England Power
Co. v. Federal Power Com'n, 467 F.2d 425, 428 (D.C. Cir. 1972),
affirmed on other grounds, 415 U.S. 345 (1974). There is no
apparent reason that employees who choose to pay for the delivery
of their paychecks could not be considered "special beneficiaries"
within the meaning the court ascribed to Congress. Moreover, the
Employer cites no specific prohibition of such a charge.