Nat'l Treasury Emps. Union v. Fed. Labor Relations Auth.

• Citation: 745 F.3d 1219
• Decision Date: 21 March 2014
• Docket Number: No. 12–1234.,12–1234.
• Parties: NATIONAL TREASURY EMPLOYEES UNION, Petitioner v. FEDERAL LABOR RELATIONS AUTHORITY, Respondent.
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

745 F.3d 1219

NATIONAL TREASURY EMPLOYEES UNION, Petitioner

v.FEDERAL LABOR RELATIONS AUTHORITY, Respondent.

No. 12–1234.

United States Court of Appeals,District of Columbia Circuit.

Argued Feb. 18, 2014.

Decided March 21, 2014.

On Petition for Review of a Final Decision of the Federal Labor Relations Authority.

Julie M. Wilson argued the cause for petitioner. With her on the briefs were Gregory O'Duden and Jacob Heyman–Kantor. Paras N. Shah entered an appearance.

Zachary R. Henige, Attorney, Federal Labor Relations Authority, argued the cause for respondent. On the brief were Rosa M. Koppel, Solicitor, and David M. Shewchuk, Deputy Solicitor.

Before: HENDERSON, ROGERS and KAVANAUGH, Circuit Judges.

Opinion for the court by Circuit Judge ROGERS.

ROGERS, Circuit Judge.

The National Treasury Employees Union petitions for review of the decision of the Federal Labor Relations Authority that the Internal Revenue Service (“the IRS”) did not commit an unfair labor practice under 5 U.S.C. § 7116 when it failed to provide the Union notice or an opportunity to bargain over an increase in the workloads of IRS Case Advocates. Because Authority precedent established that this bargaining obligation arises only when an agency initiates a change in its policies, practices, or procedures, and the Authority reasonably relied on that precedent, we deny the petition for review.

I.

The Federal Service Labor–Management Relations Statute (“the Statute”) requires agencies to bargain in good faith with their employees' recognized representative regarding “conditions of employment,” 5 U.S.C. §§ 7102(2), 7103(a)(12), 7114(a)(4), (b), which include “personnel policies, practices, and matters, whether established by rule, regulation, or otherwise, affecting working conditions,” id. § 7103(a)(14). Although an agency is not required to bargain over its management rights, including the right to control its internal organization, the number of employees, and work assignments, it must negotiate about the impact and implementation of its exercise of those rights. Id. § 7106; see NTEU v. FLRA, 414 F.3d 50, 52–53 (D.C.Cir.2005). Under 5 U.S.C. § 7116(a)(1) and (5), it is an unfair labor practice for an agency “to interfere with, restrain, or coerce any employee in the exercise by the employee of any right under this chapter” or “to refuse to consult or negotiate in good faith with a labor organization as required by this chapter.” As interpreted by the Authority, the requirement of good faith bargaining means that

prior to implementing a change in conditions of employment, an agency is required to provide the exclusive representative with notice of the change and an opportunity to bargain over those aspects of the change that are within the duty to bargain, if the change will have more than a de minimis effect on conditions of employment.

Dep't of the Air Force, Air Force Materiel Command, Space & Missile Sys. Ctr., Detachment 12, Kirtland Air Force Base, N.M., 64 F.L.R.A. 166, 173, 175 (2009); see id. at 176. Failure to do so constitutes a violation of 5 U.S.C. § 7116(a)(1) and (5). Id. at 173, 175; see also Internal Revenue Serv., Washington, D.C., 4 F.L.R.A. 488, 488, 498–99 (1980).

On June 25, 2008, the Union, as exclusive bargaining representative, filed a national grievance on the ground that the IRS had “measurably increased the caseloads of Case Advocates within the Taxpayer Advoca[te] Service (TAS) without giving notice to [the Union] and providing an opportunity to bargain,” and violated the parties' collective bargaining agreement (the “National Agreement”) and 5 U.S.C. § 7116(a)(1) and (5). See Arb. Dec. at 3–4. An arbitrator found that the IRS violated Article 47 of the National Agreement and 5 U.S.C. § 7116(a)(1) and (5) by changing employees' conditions of employment without fulfilling its notice-and-bargaining obligations. Concluding that “[t]he IRS cannot control how many taxpayers use this service established by Congress and cannot choose to ignore taxpayers' inquiries and concerns,” the Arbitrator found that “[w]orkload is not determined solely by the number of cases coming into TAS,” and that the IRS “has control over other factors that affect workload,” including case processing procedures, deadlines for completing individual actions, and the number of staff available. Arb. Dec. at 36. Because the “[s]ubstantial increases in the number of cases ... are not sufficiently mitigated by other factors,” the Arbitrator concluded that the IRS was responsible for the change in conditions of employment, triggering its notice-and-bargaining obligations. Id. at 39–40. The Arbitrator awarded various remedies, including ordering the IRS to bargain and to post a notice that it had committed an unfair labor practice and violated the National Agreement, but denied the Union's requestsfor a status quo ante remedy and attorney's fees. Both the Union and the IRS filed exceptions.

The Authority reversed in part, affirmed in part, and remanded in part. First, it set aside the unfair labor practice violation under § 7116(a)(1) and (5), explaining that a finding that an agency has failed to provide a union with notice and an opportunity to bargain over changes to conditions of employment requires a “threshold determination that the agency made a change in a policy, practice, or procedure affecting unit employees' conditions of employment.” NTEU, 66 F.L.R.A. 577, 579 (2012). The Arbitrator found only that there had been an increase in the number of incoming cases, not that the IRS made any “unilateral change” that violated its notice-and-bargaining obligations under the Statute. Id. at 580. Second, it left standing, in the absence of an exception, the Arbitrator's finding that the IRS had violated the National Agreement and therefore set aside only the posting requirement regarding the unfair labor practice. See id. at 581. Third, it rejected the Union's exception that the Arbitrator's denial of a status quo ante remedy was contrary to law but agreed with the Union on attorney's fees and remanded that portion of the award to the Arbitrator for additional factual findings, in the absence of agreement by the parties. See id. at 582.

The Union petitions for review of the Authority's determination that the IRS did not commit an unfair labor practice in violation of 5 U.S.C. § 7116(a)(1) and (5). We first address our jurisdiction.

II.

The court has jurisdiction to review a final order of the Authority when an unfair labor practice under 5 U.S.C. § 7116¹ is “either an explicit ground for, or [ ] necessarily implicated by, the Authority's decision.” Overseas Educ. Ass'n v. FLRA, 824 F.2d 61, 67–68 (D.C.Cir.1987) (adopting analysis in United States Marshals Service v. FLRA, 708 F.2d 1417, 1420 (9th Cir.1983)); see5 U.S.C. § 7123(a)(1). Here, the Authority's reversal of the Arbitrator's unfair labor practice finding clearly involves an unfair labor practice. Further, the Statute, 5 U.S.C. § 7123(c), contemplates review of a part of an Authority order by referencing 5 U.S.C. § 706, which refers to review of an “agency action” defined to include “the whole or a part of an agency ... order.” Id.§ 551(13); see id.§ 701(b)(2). An “order” is “the whole or a part of a final disposition ... of an agency.” Id.§ 551(6). The Union's petition for review of only part of the Authority's Decision therefore does not deprive the court of jurisdiction, provided that Decision is “final” under § 7123(a).

Although a remand can defeat the finality of an order, see Meredith v. Fed. Mine Safety & Health Review Comm'n, 177 F.3d 1042, 1047 (D.C.Cir.1999), for purposes of judicial review a final agency action “need not be the last administrative action contemplated by the statutory scheme.” Role Models Am., Inc. v. White, 317 F.3d 327, 331 (D.C.Cir.2003) (internal quotation marks and brackets omitted). Rather it “must mark the ‘consummation’ of the agency's decisionmaking process—it must not be of a merely tentative or interlocutory nature ... [and] the action must be one by which ‘rights or obligations have been determined,’ or from which ‘legal consequences will flow.’ ” Bennett v. Spear, 520 U.S. 154, 177–78, 117 S.Ct. 1154, 137 L.Ed.2d 281 (1997) (internal citation omitted); Nat'l Ass'n of Home Builders v. Norton, 415 F.3d 8, 13 (D.C.Cir.2005); see also John Doe, Inc. v. Drug Enforcement Admin., 484 F.3d 561, 566 & n. 4 (D.C.Cir.2007). In adopting “a uniform rule that an unresolved issue of attorney's fees for the litigation in question does not prevent judgment on the merits from being final” under 28 U.S.C. § 1291, the Supreme Court in Budinich v. Becton Dickinson & Co., 486 U.S. 196, 202, 108 S.Ct. 1717, 100 L.Ed.2d 178 (1988), explained that resolution of an attorney's fees claim “will not alter the order or moot or revise decisions embodied in the order,” id. at 199, 108 S.Ct. 1717, and generally “is not part of the merits of the action to which the fees pertain,” id. at 200, 108 S.Ct. 1717. The Court recently reaffirmed this rule in Ray Haluch Gravel Co. v. Central Pension Fund of International Union of Operating Engineers & Participating Employers, ––– U.S. ––––, 134 S.Ct. 773, 187 L.Ed.2d 669 (2014).

Given the collateral nature of the determination of the Union's attorney's fee request, we “discern no reason that the Supreme Court's holding would not apply to an appeal from the decision of an administrative agency.” Fluor Constructors, Inc. v. Reich, 111 F.3d 94, 95 (11th Cir.1997); see Wagner v. Shinseki, 733 F.3d 1343, 1349 (Fed.Cir.2013). The finality requirement is applied “in a ‘flexible’ and ‘pragmatic’ way,” John Doe, Inc., 484 F.3d at 566 (quoting Ciba–Geigy Corp. v. EPA, 801 F.2d 430, 435 (D.C.Cir.1986) (quoting Abbott Labs. v. Gardner, 387 U.S. 136, 149–50, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967))), to ensure that courts “neither improperly intrude into the agency's decisionmaking process nor squander judicial resources through piecemeal review,” ...