Opinion ID: 186689
Heading Depth: 3
Heading Rank: 2

Heading: The Scope of Bargaining

Text: 131 The right to negotiate collective bargaining agreements that are equally binding on both parties is of little moment if the parties have virtually nothing to negotiate over. That is the result of the Final Rule adopted by DHS. The scope of bargaining under the HR system is virtually nil, especially when measured against the meaning of collective bargaining under Chapter 71. And this is saying a lot, because the scope of bargaining under Chapter 71 is extraordinarily narrow. This was made clear in NTEU v. FLRA, 910 F.2d 964 (D.C.Cir. 1990) (en banc), where we pointed out 132 the unique structure of the federal sector labor relations statute, which, because of the special requirements and needs of the Government, 5 U.S.C. § 7101(b), excludes from negotiations a host of subjects that employers would be obliged to bargain about in the private sector. For instance, section 7106(a), the management rights provision of the statute, ensures that agencies need not bargain over the number of employees, their hiring, assignment, and discharge, the right to contract out work, and the authority to take whatever actions may be necessary to carry out the agency mission during emergencies. 5 U.S.C. § 7106(a). 133 Id. at 968. There is no doubt that the restricted scope of bargaining under Chapter 71 gives federal agencies great flexibility in collective bargaining, of the sort contemplated by 5 U.S.C. § 9701(b)(1) (Supp. II 2002). 134 Having reviewed the Final Rule with care, we find that the limited scope of bargaining under the proposed HR system violates the Act, and on this point we reverse the District Court. In upholding the narrow scope of bargaining permitted under the HR system, the District Court rested its analysis primarily on the HSA's enumeration of certain nonwaivable provisions of law. Since Congress gave the [Department] the authority to ignore the provisions of Chapter 71 and to establish new metes and bounds for collective bargaining at DHS, the court felt compelled to defer to DHS's new framework. Chertoff I, 385 F.Supp.2d at 28-29. This line of reasoning fails. 135 The problem with the District Court's analysis and with the Government's arguments in the same vein is that they elevate one provision of the HSA over another: the Department's authority to modify the provisions of Chapter 71 is given precedence over § 9701(b)(4)'s command to ensure collective bargaining. If DHS enjoys unlimited discretion to define the metes and bounds of collective bargaining under the HSA, it can whittle the scope of bargaining so drastically as to render collective bargaining meaningless. Under the District Court's view, there is no stopping point—the court recognizes nothing inherent in federal sector collective bargaining that fixes the scope of bargaining in the absence of Chapter 71. 136 This reasoning is fatally flawed, because, as noted above, nothing in the HSA suggests that the meaning of collective bargaining under Chapter 71 can be disregarded by the Department in its promulgation of the HR system. If, as we have shown, collective bargaining in the HSA derives its meaning from the same term in the FSLMRA, then application of the term under the latter statute must guide our understanding of how the term applies under the former. We cannot assume that Congress deployed a term of art, with a long history of legal usage, while contemplating that DHS could completely drain that term of significance. 137 A core element of collective bargaining is a requirement that labor and management bargain in good faith over conditions of employment for purposes of reaching an agreement. Indeed, the Final Rule purports to adopt this understanding of collective bargaining in its definition of the term. See 5 C.F.R. § 9701.504 (2006). The scope of bargaining under the Final Rule, however, does not come close to reaching this core element. As the District Court found, [t]he HR System essentially reduces collective bargaining to employee-specific terms affecting discipline, discharge and promotion. Chertoff I, 385 F.Supp.2d at 29. This is so far short of the meaning of collective bargaining under Chapter 71 that we are constrained to hold that the Final Rule does not meet the HSA's requirement of bargaining in good faith over conditions of employment for purposes of reaching an agreement. 138 It is readily apparent that the Final Rule reflects a flagrant departure from the norms of collective bargaining underlying Chapter 71. In fact, the Government acknowledges the striking disparity between the FSLMS framework and the system established for DHS. See DHS's Reply Br. at 13. Even a quick glance at the Final Rule confirms what the Government acknowledges, i.e., that the HR system shrinks the scope of bargaining well below what Chapter 71 provides. For example, permissive areas of bargaining under Chapter 71 are off limits for negotiation at DHS. Compare 5 U.S.C. § 7106(b)(1) (2000), with 5 C.F.R. § 9701.511(a)(2) & (b) (2006). This distinction is critical. Procedures for exercising rights affecting issues like work assignments and deployments are negotiable under Chapter 71, but not under the HR system. And, under the HR system, when management exercises one of its rights, it need not provide notice to labor representatives in advance. 5 C.F.R. § 9701.511(d) (2006). Moreover, the proposed HR system gives DHS broad new authority to take whatever other actions may be necessary to carry out the Department's mission. Id. § 9701.511(a)(2) (2006). Presumably, this provision empowers DHS to take any matter off the bargaining table at any time, regardless of what concessions have already been made by union representatives. No analogous power exists anywhere in Chapter 71. Most strikingly, DHS management is prohibited from negotiating over the procedures it will observe in exercising the authority laid out in subsections (a)(1) and (a)(2) of the management rights provision. Id. § 9701.511(b). Instead, management must merely confer with labor representatives about the procedures it will use. Id. § 9701.511(c). These provisions stand in sharp contrast to Chapter 71's obligation to bargain over the procedures used to exercise management rights. 5 U.S.C. § 7106(b)(2) (2000). 139 Finally, Chapter 71 requires agencies to bargain over appropriate arrangements for employees adversely affected by the exercise of a management right. Id. § 7106(b)(3). The HR system shrinks such bargaining considerably. For the operational matters committed to management discretion under § 9701.511(a)(1)(a)(2), DHS must negotiate appropriate arrangements only when the effects of [management's exercise of a right] have a significant and substantial impact on the bargaining unit, or on those employees in that part of the bargaining unit affected by the action or event, and are expected to exceed or have exceeded 60 days. Id. § 9701.511(e)(2)(i). Even under these narrow circumstances, appropriate arrangement proposals must be limited to such matters as personal hardships and safety measures, or reimbursements for out-of-pocket expenses. Id. § 9701.511(e)(2)(i)(A)-(B). The Final Rule thus effectively strips the term collective bargaining of any real meaning in limiting the scope of bargaining. 140 Our decision in Amalgamated Transit Union Int'l, AFL-CIO v. Donovan, 767 F.2d 939 (D.C.Cir.1985) ( ATU ), although not controlling here, is instructive. The Urban Mass Transportation Act allowed formerly private transit companies that had been transferred to public ownership to receive federal funds if the Secretary of Labor certified that the transit authority had forged a fair and equitable labor protective agreement with its union that included, inter alia, provisions ensuring employees of the continuation of collective bargaining rights. See id. at 940 (explicating 49 U.S.C.App. § 1609(c) (1982)). We found that collective bargaining had accumulated significance through its history of usage. The ATU court rejected the Secretary's invitation to measure the right to collective bargaining by reference to state law: 141 Congress neither imposed upon the states the precise definition of collective bargaining established by the [National Labor Relations Act] and the case law that has developed under that Act, nor did it employ a term of art devoid of all meaning, leaving the states free to interpret and define it as they saw fit. Instead, Congress used the phrase generically, incorporating within the statute the commonly understood meaning of collective bargaining. The 1964 Congress was not writing on a clean slate. Then as now, collective bargaining was universally understood to require, at a minimum, good faith negotiations, to a point of impasse, if necessary, over wages, hours and other terms and conditions of employment. 142 Id. at 949. We noted that those principles have long been the bedrock of collective bargaining in the federally-regulated private sector and that they had also provided the common denominator of the public sector collective bargaining schemes enacted by the states. Id. Accordingly, we acknowledged that the statute attempted a delicate balance by conditioning federal transportation aid on collective bargaining rights while not incorporating the NLRA wholesale, but we deemed it clear that federal labor policy would dictate the substantive meaning of collective bargaining for purposes of section 13(c). Id. at 950. 143 A similar analysis applies here, because Congress was not writing on a clean slate when it enacted the HSA. The Government would have us impute to Congress the expectation that, as used in the HSA, collective bargaining has no particular content, thus leaving DHS wholly unconstrained to define the term as it wishes. Because we have no evidence to indicate that Congress chose to employ a term of art devoid of all meaning, we conclude that Chapter 71 must inform the substantive meaning of collective bargaining for purposes of § 9701(b)(4). Accordingly, the scope of bargaining under HSA must be guided by the federal labor policy underlying the permissible scope of bargaining in the federal sector. The parameters of the scope of collective bargaining under the FSLMS are narrow and flexible, so Chapter 71 gives appropriate guidance to DHS in how to ensure collective bargaining for its employees. See, e.g., FLRA v. OPM, 778 F.2d 844, 845 (D.C.Cir.1985) ([T]he scope of collective bargaining is far narrower in the federal sector than in the private sector.) (citing H. ROBINSON, NEGOTIABILITY IN THE FEDERAL SECTOR 189 (1981)). For example, Chapter 71's enumeration of management rights places a number of substantive topics off limits for bargaining, 5 U.S.C. § 7106(a) (2000), but it also requires that agencies negotiate over the impact and implementation of those rights, id. § 7106(b). See FLRA v. U.S. Dep't of Justice, 994 F.2d 868, 871-72 (D.C.Cir.1993). This general framework must be followed by DHS to ensure collective bargaining for its employees, as required by the HSA. 144 Using Chapter 71 to give content to the HSA's collective bargaining requirement is perfectly consistent with the Act's authorization to proceed notwithstanding many sources of law. Chapter 71 has numerous provisions that do not directly inform the definition of collective bargaining; many would impede DHS's flexibility if it lacked the freedom to waive them. Most conspicuously, Chapter 71 envisions a significant role for FLRA: it establishes that the Authority shall provide leadership in establishing policies and guidance relating to matters under this chapter and that, with specified exceptions, it should be responsible for carrying out the purpose of this chapter. 5 U.S.C. § 7105(a)(1) (2000). It also gives the Authority extensive power to investigate, adjudicate, and enforce labor practices in the federal sector. Id. § 7105(a)(2) & (g). Yet, it is beyond dispute that the HSA permits DHS to bypass the Authority altogether in setting up a HR system. Similarly, Chapter 71 establishes a process for the resolution of bargaining impasses, id. § 7119, which DHS chose not to incorporate into its HR system. Chapter 71 also proscribes numerous unfair labor practices. See id. § 7116. The ability to selectively waive or modify § 7116 clearly comports with the HSA's stated imperatives of flexibility and contemporaneity. 145 Furthermore, it must be recalled that the duty to bargain does not require agreement, only a good faith effort by the parties to reach agreement. Id. §§ 7103(a)(12), 7114(a)(4) & (b). Additionally, employees in the federal sector are forbidden from striking, Prof'l Air Traffic Controllers Org. v. FLRA, 685 F.2d 547, 550 (D.C.Cir.1982), so they can add no economic leverage to their bargaining demands as can employees in the private sector. And, most importantly, employees covered by DHS's HR system will not have the advantage of an impasses panel— which can impose conditions of employment if the parties' negotiations reach an impasse, see 5 U.S.C. § 7119(c)(5)(B)(iii) (2000)—as do employees who are covered by Chapter 71. In other words, if the Department follows the core notion of collective bargaining in the federal sector in defining the scope of bargaining under the HR system, as the Act requires, DHS will have extraordinary flexibility to achieve the goals of the statute and, at the same time, ensure that the limited benefits flowing from a contemporary program of collective bargaining in the federal sector are made available to its employees. The Act mandates no less. 146 3. The Final Rule Fails to Ensure Collective Bargaining for DHS Employees in Two Critical Respects—Therefore No Deference is Due the Department's Interpretation of the HSA 147 The foregoing discussion makes it clear that, insofar as the Final Rule permits the Department to abrogate final agreements and narrowly limits the scope of bargaining to employee-specific terms, the regulations fail to ensure collective bargaining for DHS employees. In these circumstances, we owe no deference to DHS's interpretation of the HSA. 148 As we explain above, Chevron analysis typically is focused on discerning the boundaries of Congress' delegation of authority to the agency; and as long as the agency stays within that delegation, it is free to make policy choices in interpreting the statute, and such interpretations are entitled to deference. Aid Ass'n for Lutherans v. United States Postal Serv., 321 F.3d 1166, 1174 (D.C.Cir.2003) (citation and inner quotation marks omitted). An agency construction of a statute cannot survive judicial review, however, if a contested regulation reflects an action that is inconsistent with the agency's authority. It does not matter whether the unlawful action arises because the disputed regulation defies the plain language of a statute or because the agency's construction is utterly unreasonable and thus impermissible. Am. Library Ass'n, 406 F.3d at 699 (citing Aid Ass'n for Lutherans, 321 F.3d at 1174). 149 In this case, as we have shown, DHS's Final Rule defies the plain language of the Act, because it renders collective bargaining meaningless; and it is utterly unreasonable and thus impermissible, because it makes no sense on its own terms. The Government's argument is premised on a view that DHS's authority to modify the provisions of Chapter 71 takes precedence over § 9701(b)(4)'s command to ensure collective bargaining. As we have explained, this is simply wrong. The agency's policy preferences cannot trump the words of the statute.