Case Name: NATIONAL TREASURY EMPLOYEES UNION, Petitioner, v. FEDERAL LABOR RELATIONS AUTHORITY, Respondent
Court: United States Court of Appeals for the District of Columbia Circuit
Jurisdiction: United States
Decision Date: 1988-11-23
Citations: 856 F.2d 293
Docket Number: No. 87-1165
Parties: NATIONAL TREASURY EMPLOYEES UNION, Petitioner, v. FEDERAL LABOR RELATIONS AUTHORITY, Respondent.
Judges: Before MIKVA, RUTH BADER GINSBURG, and SILBERMAN, Circuit Judges.
Reporter: Federal Reporter 2d Series
Volume: 856
Pages: 293–308

Head Matter:
NATIONAL TREASURY EMPLOYEES UNION, Petitioner, v. FEDERAL LABOR RELATIONS AUTHORITY, Respondent.
No. 87-1165.
United States Court of Appeals, District of Columbia Circuit.
Argued Jan. 29, 1988.
Decided Sept. 9, 1988.
Order Granting Rehearing En Banc Nov. 23, 1988.
Cary P. Sklar, with whom Lois G. Williams, Gregory O’Duden, and Michael J. Wolf, Washington, D.C., were on the brief, for petitioner.
William E. Persina, Deputy Sol., Federal Labor Relations Authority, with whom Ruth E. Peters, Solicitor, and Arthur A. Horowitz, Associate Sol., Federal Labor Relations Authority, Washington, D.C., were on the brief, for respondent.
Before MIKVA, RUTH BADER GINSBURG, and SILBERMAN, Circuit Judges.

Opinion:
Opinion for the Gourt filed by Circuit Judge MIKVA.
Dissenting Opinion filed by Circuit Judge SILBERMAN.
MIKVA, Circuit Judge:
In February 1987, the Federal Labor Relations Authority ("the Authority") held that the Internal Revenue Service ("IRS" or "the agency") unlawfully refused to bargain with the petitioner, National Treasury Employees Union ("NTEU" or "the union"), over employee parking arrangements at the IRS' new office outside Houston, Texas. The Authority ordered the IRS to bargain with the union. Petitioner maintains that the Authority erred in failing to require retroactive application of any agreement resulting from the order to bargain. We agree that the Authority should have issued a retroactive bargaining order ("RBO") and reverse and remand to the Authority for redetermination of the remedy.
I. Background
In September 1982, the IRS notified the NTEU of a proposed relocation of employees from two downtown offices to a new suburban location outside Houston known as Briarpark. The union proposed to negotiate a number of matters affected by the relocation, including employee parking. Because the IRS claimed it could not yet furnish information concerning its leasing agreement with the building owner, negotiation on this issue was temporarily deferred. In January 1983, the IRS asked the union to enter an interim agreement to facilitate the agency's arrangement with Allright Auto Parks to manage the parking facilities. Unaware that the IRS had already signed a contract with Allright in November, the NTEU negotiated an interim agreement providing that all but 14 spaces would be available to employees at a monthly charge of $20 per space on a first come-first served basis. When the parties met later that month to resume negotiations, the union put forward different proposals concerning parking charges and the number of spaces reserved to management, but the parties were unable to come to a final agreement.
In subsequent meetings, the IRS refused to negotiate further over parking arrangements. The IRS bargaining team first insisted that General Services Administration regulations precluded the agency from paying for parking, then claimed that it had not been delegated authority by the Regional Commissioner to agree to finance parking, and later asserted that the authority to arrange parking was reserved to the Briarpark building owner. Finally, the IRS argued that it had no duty to bargain because no material change in working conditions had occurred with the relocation.
The NTEU filed an unfair labor practice charge with the Authority alleging that the IRS had refused to bargain in good faith in violation of section 7116(a)(5) of the Federal Labor-Management Relations Statute, 5 U.S.C. § 7101-7135 (1982 & Supp. 1988) ("the Statute"). The Authority agreed that the IRS violated its duty to bargain over payment and allocation of employee parking spaces. The Authority ordered the IRS to bargain in good faith over the NTEU's proposals, but denied the union's request that retroactive effect be given to any resulting agreement. The Authority justified its decision to confine the remedy to a prospective bargaining order by reiterating its arguments in Environmental Protection Agency and American Federation of Government Employees, 21 F.L.R.A. 786 (1986) ("EPA & AFGE "). The Authority stated that the prospective bargaining order was an adequate remedy for the IRS' unlawful refusal to bargain because it allowed the parties to address the effects on unit employees of the change in the parking situation resulting from relocation. The Authority explained that the order preserved the parties' flexibility by allowing them to adopt a variety of terms while leaving them free to agree to retroactive application.
NTEU now petitions this court for reversal of the Authority's denial of its request for a retroactive bargaining order. We note in passing that the correctness of the Authority's determination that the IRS en gaged in an unlawful labor practice when it refused to negotiate over employee parking is not before us — the sole issue upon review is whether the Authority, given its finding of an unfair labor practice in this case, abused its discretion by not imposing a retroactive bargaining order.
II. Discussion
We agree with the NTEU that the Authority abused its discretion by failing to mandate retroactive application of an agreement between the parties concerning parking. We take issue with the Authority's view that a retroactive bargaining order is an extraordinary remedy requiring special justification, and with its specific application of that approach in a case such as this where monetary compensation is practicable. We reiterate, in accordance with recent holdings of this court, that to effect the deterrent and remedial goals of the Statute, the Authority must award the fullest measure of "make whole" relief. Where, as here, the congressional intent that unlawful conduct be deterred and "make whole" relief be provided can be respected only by issuing an RBO, and where such an order would not unduly disrupt federal agency administration, we hold that an RBO is required.
A.
Several sections of the Statute define the remedial authority and responsibility of the Authority. These provisions grant broad discretion to the Authority to fashion remedies for violations of the Statute. Section 7105(g)(3) provides that the Authority may require an agency to take any remedial action it considers appropriate to carry out the policies of the Statute. Moreover, under section 7118(a)(7), "[i]f the Authority determines that the agency has engaged in or is engaging in an unfair labor practice, then [the Authority] shall issue an order (B) requiring the parties to renegotiate a collective bargaining agreement in accordance with the order of the Authority and requiring that the agreement, as amended, be given retroactive effect; or (D) including such other action as will carry out the purpose of this chapter."
Although the principles set forth in Chevron, U.S.A., Inc. v. NRDC, 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), require us to defer to an agency's interpretation of the statute it administers when the statute is silent or ambiguous with respect to a specific issue, see id. at 843, 104 S.Ct. at 2781, we find in this case that the Authority's construction of the Statute fails to implement the clear intent of Congress. Cf. Bureau of Alcohol, Tobacco and Firearms v. FLRA, 464 U.S. 89, 97, 104 S.Ct. 439, 444, 78 L.Ed.2d 195 (1983) (although "the Authority is entitled to considerable deference when it exercises its 'special function of applying the general provisions of the [Statute] to the complexities' of federal labor relations, reviewing courts must not 'rubber-stamp administrative decisions that they deem inconsistent with a statutory mandate or that frustrate the congressional policy underlying a statute.' ") (citations and internal ellipsis omitted).
This court has recently stressed that both the remedial responsibility of the Authority and the underlying purpose of the Statute must be understood in light of Congress' intention that "the FLRA's role in adjudicating unfair labor practice cases in the federal sector [should] be similar to that of the NLRB's in the private sector." AFGE v. FLRA, 785 F.2d 333, 336 (D.C.Cir.1986) (per curiam). Thus, in cases where an agency unlawfully effects a unilateral change in working conditions, the Authority, like the NLRB, should restore the status quo ante whenever possible, consistent with respect for management's prerogatives under section 7106(a) and the overall goal of agency efficiency. See AFGE, SSA Council 220 v. FLRA, 840 F.2d 925 (D.C.Cir.1988). If complete status quo ante ("SQA") relief is inappropriate or infeasible, individual "make whole" relief should nevertheless be granted to the extent consistent with the limiting principles already noted. Id. at 929-30 (noting a "weighty preference" for individualized "make whole" relief). The award of "make whole" relief to remedy unlawful agency action is especially appropriate in the case where the relief takes the form of a monetary award. See AFGE v. FLRA, 785 F.2d at 337 (citing Great Chinese American Sewing Company v. NLRB, 578 F.2d 251 (9th Cir.1978) (noting that monetary relief, such as back pay, is typically granted even when other SQA relief is denied because of undue hardship)). Back pay is one form of such "make whole" relief, but the principle properly applies to any monetary award that compensates employees for losses resulting from unilateral change. As this court has recognized, "such individualized relief is unlikely to be as disruptive as a sweeping institutional remedy." SSA Council 220, 840 F.2d at 930. Thus, a remedial determination that withholds monetary compensation for deprivations suffered by employees as a result of unlawful employer action is rarely justified, because "rarely will there be a sound statutory reason to withhold such recompense." Id.
An approach to remedies that systematically fails to deter noncompliance, or dilatory compliance, with the Statute's directives is fundamentally at odds with the Authority's responsibilities. As our court pointed out in AFGE v. FLRA, Congress expected the Authority to vindicate the public policy of the Statute, expressed in the "Findings and purpose" provision, to encourage collective bargaining in the civil service. See 785 F.2d at 338 (citing 5 U.S.C. § 7101(a)). The AFGE v. FLRA panel recognized that the Authority's habitual use of prospective bargaining orders to remedy refusal-to-bargain violations provides management no incentive to honor its obligations under the Statute. By refusing to bargain, management wins a delay in compliance with its statutory duty at the risk of no more than a "slap on the wrist." Id. Employees are left to bear the losses and suffer the detriments of working under conditions ordained by management rather than fixed by bargaining. Thus, retroactive remedies are an indispensable means to vindicate the Statute's central goals.
B.
The Authority argues that any preference for SQA or "make whole" relief does not extend to orders for retroactive application of bargaining agreements. The Authority maintains that an RBO is not in the same category as an SQA remedy, and does not merit the same favoritism, because an RBO does not restore employees to the state they enjoyed before management unlawfully effected a unilateral change. In the case sub judice, a true SQA remedy would consist of undoing the Briarpark relocation, which all parties agree is not feasible. The Authority implies that, although an RBO may return to employees those benefits they would have enjoyed had the agency initially bargained, one cannot assume that the RBO will have this effect; it is sheer speculation that the terms incorporated in the final contract will be those the parties would have adopted initially.
Thus, the Authority does not believe that a policy favoring "make whole" relief should translate into a preference for RBOs. We disagree. A "make whole" remedy compensates individual employees for losses suffered and divests management of the benefits of illegal action. A retroactive bargaining order aims to do the same. The difference is that an RBO requires the Authority, or a grievance committee, to estimate the "make whole" compensation due employees by means of the convenient, albeit somewhat speculative, conceit of assuming that the agreement the parties eventually negotiate approximates the agreement they would have forged in the first instance. The retroactive application of a contract ultimately negotiated by the parties relieves the Authority of the need to speculate on the precise details of a hypothetical contract. Cf. NTEU v. FLRA, 732 F.2d 703, 706-07 (9th Cir.1984) (affirming Authority decision declining to apply retroactive relief of its own design).
Recourse to this remedial device is necessary in this case because of the nature of the agency's infraction. This is not a case where the agency effected an isolated change in a working condition it was not entitled to change without negotiation. Rather, the IRS exercised its lawful right under section 7106(a) to relocate its operations, but failed to bargain over one aspect of the move — new parking arrangements. The entire relocation cannot be reversed without causing undue disruption of agency operations and trenching on the agency's statutory authority. By ordering an RBO, the Authority can avoid these consequences while compensating employees for the difference between what they received under the unbargained-for parking arrangement and what they would have received had the arrangement been subject to bargaining.
The key distinction is not between SQA remedies and RBOs as such, but between remedies that completely undo the institutional arrangements created by the unbar-gained-for actions of the agency and less intrusive "make whole" remedies. What in the ease at bar is called an RBO, and what was called in SSA Council 220 an SQA (albeit a limited SQA), accomplish the same thing in the same way: both avoid institutional disruption while providing monetary "make whole" compensation to employees adversely affected by a refusal to bargain over a change in working conditions. The compensation is measured and achieved by the retroactive application of the bargaining order. Indeed, the Authority has adopted this convention in computing back pay awards under the Back Pay Act, 5 U.S.C. § 5596 (1982). See FAA, Washington, D.C. and Professional Airways Systems Specialists, MEBA, AFL-CIO, 27 F.L.R.A. 230, 234 (1987) (issuing "an order directing bargaining and the payment of backpay consistent with the outcome of the bargaining"). In SSA Council 220, 840 F.2d at 930-31, this court suggested that the Authority compute in the same way the compensation due employees adversely affected by an unlawfully implemented evaluation system.
Here, the "make whole" remedy for refusal to bargain over parking charges is straightforward. If the union succeeds in negotiating a lower parking charge than employees currently pay, the employees will receive the difference in the amount paid for parking during the period of unilateral action and the amount set by contract. The measure of retroactive compensation for the IRS' refusal to bargain over reservation of parking spaces for management is less clear. We leave to the Authority's determination the factual question of whether it would be possible for the union to show that employees suffered monetary loss — e.g., in the form of higher parking charges — as a result of removal of some parking spaces from the general pool in the event that those spaces are restored by a negotiated agreement. In any event, a grievance committee need not award, and cannot calculate, this component of a "make whole" award unless the union can demonstrate some "causal nexus" between higher employee charges and the reservation policy. However, the possibility that retroactive compensation for refusal to bargain over this matter may prove infeasible does not undermine the Authority's duty to award retroactive compensation where its measure is clear; nor does it vitiate the requirement that partial "make whole" relief be awarded to the fullest extent possible. See SSA Council 220, 840 F.2d at 929-30.
C.
The foregoing discussion demonstrates that retroactive bargaining orders compensate aggrieved employees and encourage management compliance in a way similar to "true" SQA remedies. The Authority nevertheless offers further reasons why an RBO should issue far less frequently than an SQA order that simply requires management to return to prior conditions. The Authority contends that retroactive bargaining orders run afoul of countervailing statutory policies by interfering with the functioning of the Federal Services Impasses Panel ("FSIP" or "the Panel") and infringing the parties' prerogative to determine the content of the collective bargaining agreement in accordance with section 7103(a)(12) of the Statute. The latter provision states that the obligation to bargain collectively "does not compel either party to agree to a proposal or to make a conces sion." The Authority claims these considerations justify its practice, as explained in EPA & AFGE, not to grant retroactive remedies for simple refusal to bargain but to reserve the remedy for those cases where the agency refuses to negotiate over proposals previously found negotiable or defies a decision by an arbitrator.
The Statute states that- the FSIP may "take whatever action is necessary and not inconsistent with this chapter to resolve [an] impasse." 5 U.S.C. § 7119(c)(5)(B)(iii). The Authority contends that the FSIP cannot fulfill its statutory obligation without the flexibility to order any action it deems appropriate to resolve an impasse. We disagree that an order by the Authority to give retroactive effect to the terms of a bargaining agreement significantly impairs the function of the FSIP. Because public employees, unlike their private sector counterparts, do not enjoy the right to strike, Congress created the FSIP to help resolve disputes in the event the parties are unable to agree. The considerations bearing on the proper role of the FSIP are eminently pragmatic; neither the spirit nor the letter of the statutory provisions governing the Panel grants it absolute discretion over every aspect of the collective bargaining process. The Panel retains ample flexibility to arrive at a fair and satisfactory resolution of a bargaining impasse and is free to adjust the substantive content of contract terms against the understanding that retroactive compensation will be part of the bargain. The requirement that any terms stipulated by the Panel be given retroactive effect has a minimal impact on the Panel's functioning and is fully justified by the twin goals of deterrence and employee compensation.
It may be argued that this arrangement is a zero sum game for employees: the agency will simply offer less, knowing it is bound to a retroactive extension of the terms to which it agrees. It is possible that employees will sometimes be forced to give up at the bargaining table, or ordered to relinquish by the Panel, the equivalent of what they have gained by retroactivity, but we doubt that this is inevitable in every case. Bargaining rarely proceeds on a perfect economic model of costless transaction, and we think it likely that the union will retain some of the advantage conferred by the privilege to retain or waive its right to retroactive application of bargaining terms. In any event, we decline to base our decision on the possibility that, in some cases, employees may fail to reap the full benefits of a retroactive award.
D.
Finally, the agency contends that an RBO, will impose bargaining terms on the parties in derogation of section 7103(a)(12). The Authority takes the position that the proper balance between its remedial responsibilities and the parties' prerogative requires the, Authority to refrain from ordering retroactivity in all but extraordinary cases. We disagree that Congress intended that the balance be struck to the detriment of the Statute's remedial goals. In section 7118(a)(7)(B), Congress specifically provided that, when necessary to remedy an unfair labor practice, the Authority "shall issue an order requiring the parties to renegotiate a collective bargaining agreement in accordance with the order of the Authority and requiring that the agreement be given retroactive effect" (emphasis added). We think that this "mandatory" language, see SSA Council 220, 840 F.2d at 929 (construing section 7118(a)(7)), specifically requires the Authority to grant the relief requested here—namely, retroactive application of terms arrived at by negotiation. In this case, because the Authority has already determined that the IRS committed an unfair labor practice, the mandatory prescription of section 7118(a)(7) governs.
In addition,' the legislative history shows that Congress contemplated that retroactivity would be routinely ordered as a remedy for straightforward refusal to bargain. The only enlightening piece of legislative history concerning this provision was furnished on the day following the passage of the Statute by Representative Ford, one of the House conferees on the bill. Representative Ford explained that his comments were intended to supplement the "less than helpful" conference documents that accompanied a bill passed during the end-of-session rush. See 124 Cong.Rec. 38,713 (1978). The Supreme Court has cautioned us not to place great reliance on post-enactment pronouncements. See, e.g., Regional Rail Reorganization Act Cases, 419 U.S. 102, 132, 95 S.Ct. 335, 353, 42 L.Ed.2d 320 (1974). Our own precedent repeats that message. See, e.g., Edison Electric Institute v. OSHA, 849 F.2d 611, 619 (D.C.Cir.1988). However, Mr. Ford's comments are consistent with statutory language and were offered to compensate for an otherwise sparse legislative history; we believe his remarks therefore merit some attention. See NFFE v. FLRA, 652 F.2d 191, 193 (D.C.Cir.1981); NTEU v. FLRA, 774 F.2d 1181, 1187 n. 10 (D.C.Cir.1985).
Mr. Ford stated that section 7118(a)(7)(B) was inserted to give the Authority the power denied the NLRB to issue remedial orders dictating terms of a collective bargaining agreement. Cf. H.K. Porter Co. v. NLRB, 397 U.S. 99, 90 S.Ct. 821, 25 L.Ed.2d 146 (1970) (interpreting the National Labor Relations Act to preclude a Labor Board order that a union "check-off" term be included in a negotiated contract). He explained that "the Authority is fully empowered under section 7118(a)(7)(B) to issue an order requiring the violator to agree to [a] provision unless the charging party waives, in whole or part, agreement on the provisions during negotiations. The conference report took this position despite the presence in both title VII and the National Labor Relations Act of the statement that the bargaining obligation 'does not compel either party to agree to a proposal or require the making of a concession.' " 124 Cong.Rec. at 38,714.
This statement, consistent with the statutory language, makes clear that the Authority's section 7118(a)(7)(B) remedial power to order retroactivity, when its exercise is necessary to carry out the purposes of the Statute, takes precedence over the parties' section 7103(a)(12) freedom to bargain without interference. Moreover, the legislative history nowhere limits application of section 7118(a)(7)(B) to cases of egregious and contumacious violation of an order of the Authority or the Panel. Indeed, Representative Ford stated that the provision empowers the Authority to give retroactive effect in those cases "[w]here failure to bargain in good faith has prevented agreement on a provision." He added that "[t]he mandatory language used in section 7118(a)(7) reflects the intention of the conferees that where a violation has been found, the Authority must issue a remedy appropriate to the violation." Id. (emphasis added). '
Congress thus intended in section 7118(a)(7)(B) to allow the Authority to issue an order the National Labor Relations Board cannot issue under H.K. Porter— namely, an order stipulating the content of a collective bargaining agreement. There is no reason to interpret section 7118(a)(7)(B) as only conferring authority to make retroactive those terms the Authority has ordered the parties to adopt. If this provision allows the Authority to stipulate the content of terms and give those terms retroactive effect, then it certainly allows the Authority to take the less intrusive step of ordering that terms negotiated by the parties be applied retroactively. Thus, we understand the language of section 7118(a)(7)(B) to empower the Authority to order the parties to reach their own agreement and require that whatever agreement they reach apply retroactively. Moreover, the statement in the House Report that "[t]he action ordered [by the remedial provision now designated § 7118(a)(7) ] may include: directing retroactive amendment of a collective bargaining agreement" clearly encompasses the case where the Authority requires that the parties' terms be applied retroactively. See H.R.Rep. No. 1403, 95th Congress, 2d Sess. 53 (1978), U.S.Code Cong. & Admin. News 1978, p. 2723. Because Congress expressly authorized retroactive orders despite their modest effect on bargaining flexibility, we must reject the Authority's contention that an RBO impermissibly usurps the statutory role of the negotiating parties.
Finally, we note that Representative Ford also stated that Congress expected "the courts [to] oversee the work of the Authority in this area in order to ensure that the Authority vigorously enforces the purpose and provisions of title VII [the remedial section of the Statute] by adopting remedies sufficiently strong and suitable to make real the promise of the title and the obligations of its provisions." 124 Cong.Rec. at 38,713. This merely confirms our view, based on the statutory language, that we may require the Authority to issue an RBO in this case. Accordingly, we do not accept the dissent's assertion that we have misappropriated a policy choice delegated to the Authority.
III. Conclusion
As the statutory language indicates, and as the Statute's drafters intended, the Authority's remedial mission must take precedence where complete deference to the parties' freedom to bargain or to the FSIP's flexibility to resolve impasses would undermine the Statute's goals. As this court has previously held, the goals of management deterrence and employee recompense are ill served, and the delicate balance of power between management and labor intolerably skewed, by treating the agency as if no violation had occurred. See AFGE, SSA Council 220 v. FLRA, 840 F.2d 925 (D.C.Cir.1988); AFGE v. FLRA, 785 F.2d 333 (D.C.Cir.1986) (per curiam). For these reasons, we think the Statute requires a retroactive bargaining order in this case. We therefore vacate the order of the Authority and remand for a redetermination not inconsistent with this opinion.
It is so ordered.