399 F.3d 334 (D.C. Cir. 2005), 03-1351, National Treasury Employees Union v. Federal Labor Relations Authority

Docket Nº:03-1351.
Citation:399 F.3d 334
Party Name:NATIONAL TREASURY EMPLOYEES UNION, Petitioner v. FEDERAL LABOR RELATIONS AUTHORITY, Respondent
Case Date:March 08, 2005
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit
 
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399 F.3d 334 (D.C. Cir. 2005)

NATIONAL TREASURY EMPLOYEES UNION, Petitioner

v.

FEDERAL LABOR RELATIONS AUTHORITY, Respondent

No. 03-1351.

United States Court of Appeals, District of Columbia Circuit

March 8, 2005

Argued Sept. 15, 2004

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[Copyrighted Material Omitted]

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Robert H. Shriver, III argued the cause for the petitioner. Gregory O'Duden, General Counsel, and Barbara A. Atkin, Deputy General Counsel, National Treasury Employees Union, were on brief.

James F. Blandford, Attorney, Federal Labor Relations Authority, argued the cause for the respondent. David M. Smith, Solicitor, and William R. Tobey, Deputy Solicitor, Federal Labor Relations Authority, were on brief.

Before: HENDERSON, RANDOLPH and GARLAND, Circuit Judges.

KAREN LECRAFT HENDERSON, Circuit Judge.

The National Treasury Employees Union (NTEU or Union) petitions for review of a decision by the Federal Labor Relations Authority (FLRA or Authority) concluding that its proposals to define the scope of the duty to bargain mid-term constitute only a permissive subject of bargaining. Because the Authority failed to adequately set forth its reasoning and also departed from precedent without sufficient explanation, we remand the case.

I. Background

The NTEU serves as the exclusive bargaining representative of employees of the U.S. Customs Service (Service or Agency). 1 During the course of negotiations with the Agency over a new collective bargaining agreement in 2001, the NTEU made two proposals to require mid-term bargaining unless the matter at issue was "specifically addressed" by the terms of the agreement. 2 The Agency refused to bargain over the proposals. It argued that the Union proposals involved a permissive, not mandatory, subject of bargaining under the Federal Service Labor-Management Relations Statute, 5 U.S.C. §§ 7101-7135 (FSLMRS or Statute). The Union then filed a petition for review with the FLRA on December 13, 2001. In a decision and order dated September 25, 2003, the FLRA found the proposals negotiable only at the election of the Agency. Nat'l Treasury Employees Union & U.S. Customs Serv., 59 F.L.R.A. 217, 2003 WL 22250526 (2003) (Order). It concluded that the "covered by" doctrine, which--in the absence of a collective bargaining agreement between the parties to the contrary--limits the duty to bargain mid-term to matters not (1) expressly contained or (2) inseparably bound up with subjects covered in the agreement, see U.S. Dep't of Health & Human Serv., Soc. Sec. Admin., Baltimore, MD. & Am. Fed'n of Gov't Employees, 47 F.L.R.A. 1004, 1016-18 (1993)

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(SSA), "constitutes ... a statutory right" and that therefore an agency may, but "cannot be required to," bargain over a proposal modifying the doctrine. Order, 59 F.L.R.A. at 220. Pursuant to section 7123(a) of the FSLMRS, the Union then petitioned this court for review.

II. Discussion

A.

We review orders of the FLRA in accordance with section 706 of the Administrative Procedure Act (APA). 5 U.S.C. § 7123(c). Thus, the Authority's decision will not be set aside unless it is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C.§ 706(2) (A). The Authority is entitled to "considerable deference when ... applying the general provisions of the [Statute] to the complexities of federal labor relations." Bureau of Alcohol, Tobacco & Firearms v. FLRA, 464 U.S. 89, 97, 104 S.Ct. 439, 78 L.Ed.2d 195 (1983) (internal quotation marks omitted). We defer to the FLRA's interpretation of the FSLMRS if it is "reasonable and coherent." Am. Fed'n of Gov't Employees v. FLRA, 712 F.2d 640, 643 (D.C.Cir. 1983). "If an agency construes its charter erratically or inconsistently, however, little or no deference will be owed to its decisions." Id. at 643 n. 17 (citing Adamo Wrecking Co. v. United States, 434 U.S. 275, 287, 98 S.Ct. 566, 54 L.Ed.2d 538 n.5 (1978), and Skidmore v. Swift & Co., 323 U.S. 134, 140, 65 S.Ct. 161, 89 L.Ed. 124 (1944)).

The duty to bargain mid-term derives from the FSLMRS's command to both labor and management to "meet and negotiate in good faith for the purposes of arriving at a collective bargaining agreement." 5 U.S.C. § 7114(a) (4). Although the text of the FSLMRS imposes no explicit obligation to bargain mid-term, we concluded in Nat'l Treasury Employees Union v. F.L.R.A., 810 F.2d 295 (D.C.Cir. 1987), that mid-term bargaining is required under the Statute based on the purpose and legislative history of the Statute as well as analogous private sector precedent. Id. at 298-301. 3 The FLRA adopted our position, holding that an agency has a duty to bargain over mid-term proposals regarding matters not "contained in the agreement unless the union has waived its right to bargain about the subject matter involved." 4 Internal Revenue Serv. & Nat'l Treasury Employees Union, 29 F.L.R.A. 162, 166 (1987). The "contained in" exception to the duty to bargain was borrowed from the private sector. See 29 U.S.C. § 158(d). The FLRA gradually refined its understanding of the "contained in" requirement, settling on the "covered by" test enunciated in SSA: parties are free from any duty to bargain mid-term over matters "expressly contained in" or "inseparably bound up with" a contract term. 47 F.L.R.A. at 1016-18. This approach was intended to balance the twin aims of the Statute: stability in collective bargaining

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agreements and promotion of collective bargaining to the broadest extent possible. See id. at 1018.

The issue of mid-term bargaining under the FSLMRS reached the United States Supreme Court in Nat'l Fed'n of Fed. Employees, Local 1309 v. U.S. Dep't of Interior, 526 U.S. 86, 119 S.Ct. 1003, 143 L.Ed.2d 171 (1999) (NFFE). There the Court held that "the Statute delegates to the Federal Labor Relations Authority the legal power to determine whether the parties must engage in mid-term bargaining (or bargaining about that matter)." Id. at 88, 119 S.Ct. 1003. It further held that "Congress delegated to the Authority the power to determine--within appropriate legal bounds--whether, when, where, and what sort of mid-term bargaining is required." Id. at 98-99, 119 S.Ct. 1003 (internal citations omitted). On remand from the Supreme Court, the Authority iterated its earlier interpretation that "under the Statute, agencies are obligated to bargain during the term of a collective bargaining agreement on negotiable union proposals concerning matters that are not 'contained in or covered by' the term agreement, unless the union has waived its right to bargain about the subject matter involved." U.S. Dep't of the Interior & U.S. Geological Survey, Reston, Virginia, 56 F.L.R.A. 45, 50 (2000) (Interior). Like the instant case, Interior involved a union proposal made during end-term negotiations over a new collective bargaining agreement. The union proposal in Interior required mid-term bargaining over all negotiable union proposals "not covered by the provisions of this...

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