United States Dep't of the Navy v. Fed. Labor Relations Auth., 10–1304.
| Decision Date | 13 January 2012 |
| Docket Number | No. 10–1304.,10–1304. |
| Citation | 192 L.R.R.M. (BNA) 2591,398 U.S.App.D.C. 476,665 F.3d 1339 |
| Parties | UNITED STATES DEPARTMENT OF the NAVY, Naval Undersea Warfare Center Division Newport, Rhode Island, Petitioner v. FEDERAL LABOR RELATIONS AUTHORITY, Respondent. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
OPINION TEXT STARTS HERE
On Petition for Review of an Order of the Federal Labor Relations Authority.Mark W. Pennak, Attorney, U.S. Department of Justice, argued the cause for petitioner. With him on the briefs were Tony West, Assistant Attorney General, and William Kanter, Attorney.
Rosa M. Koppel, Solicitor, Federal Labor Relations Authority, argued the cause and filed the brief for respondent.
Before: GINSBURG,1 HENDERSON, and KAVANAUGH, Circuit Judges.
Opinion for the Court filed by Circuit Judge KAVANAUGH.
This case turns on whether a government agency may provide employees with free bottled water even when safe and drinkable water is available from water fountains at their work sites. Under federal appropriations law, the answer is no.
In the mid–1990s, the Naval Undersea Warfare Center Division in Newport, Rhode Island, began providing employees with bottled water. It did so after an EPA report indicated that water fountains in some Navy buildings in Newport contained components manufactured with lead. Beginning in 2005, however, the Navy replaced the problematic water fountains, tested the tap water, and determined it safe to drink. The Navy then stopped providing bottled water; it did not negotiate with employee unions before removing the bottled water. The Navy reasoned that an agency has no duty or authority to bargain over or grant benefits that are prohibited by federal appropriations law. And the Navy concluded that providing bottled water when safe and drinkable tap water was available would violate the legal prohibition against use of appropriated funds for employees' personal expenses.
The unions representing civilian employees at the Newport facilities objected to the removal of the bottled water and filed grievances with the Navy. When negotiations did not yield a compromise, the unions sought binding arbitration. An arbitrator sided with the unions and ordered the Navy to continue providing bottled water on the ground that bottled water had become a condition of employment. The Federal Labor Relations Authority—an independent government agency responsible for adjudicating federal labor-management disputes—affirmed the arbitrator's decision, holding that the Navy had a duty to bargain with the unions before removing the bottled water. The Navy petitioned for review in this Court.
Decisions of the Supreme Court and this Court have strictly enforced the constitutional requirement, implemented by federal statutes, that uses of appropriated funds be authorized by Congress. See U.S. Const. art. I, § 9, cl. 7; 31 U.S.C. § 1301 et seq. Funds appropriated for agency operations may be used for “necessary expenses” but not for employees' “personal expenses.” As the Comptroller General has long determined, when safe and drinkable tap water is available in the workplace, bottled water constitutes a personal expense for which appropriated funds may not be expended. Under federal collective bargaining law, moreover, an agency has no duty or authority to bargain over or grant benefits that are “inconsistent with any Federal law.” 5 U.S.C. § 7117(a)(1). Therefore, if safe and drinkable tap water was available at the Newport facilities, the Navy had no authority or duty to bargain before removing the bottled water.
We therefore vacate the decision of the Federal Labor Relations Authority and remand this case to the Authority to determine whether the tap water is in fact safe to drink. If the Authority concludes that the tap water is safe to drink, the Authority must rule for the Navy.
The Naval Undersea Warfare Center Division in Newport, Rhode Island, develops and supports submarine warfare systems for the U.S. Navy. Civilian employees at the Newport facilities are represented by two unions: (i) the National Association of Government Employees, Local R1–134, known as NAGE, and (ii) the Federal Union of Scientists and Engineers, Local R1–144, known as FUSE. NAGE negotiated a collective bargaining agreement with the Navy; FUSE had a grievance procedure agreement with the Navy, but no collective bargaining agreement.
The Navy began providing bottled water at the Newport facilities in the mid–1990s after it discovered that water fountains in some buildings were manufactured with components containing lead. Beginning in 2005, the Navy replaced those fountains with newer, lead-free models. The base command then re-tested the base's tap water sources. In 2006, after determining that the base's tap water was safe to drink, the Navy stopped providing bottled water. The base commander sent out a base-wide email assuring staff that the tap water was safe. The email informed base personnel that federal appropriations law precluded the Navy from providing bottled water given that safe and drinkable tap water was available.
The unions filed grievances under their negotiated dispute resolution procedures, arguing as relevant here that the Navy had a duty to bargain with them before removing the bottled water. When the grievances were not resolved through negotiation, the unions sought binding arbitration.
The arbitrator found that any change in the practice of providing bottled water “required conferring and negotiating between the parties bound by the Collective Bargaining Agreement(s).” In re Arbitration Between Dep't of the Navy, Naval Undersea Warfare Ctr., Div. Newport & FUSE/NAGE R1–144 & NAGE R1–134, FMCS Case No. 070330–55282–3, at 8 (June 19, 2008). The arbitrator declined to consider the Navy's argument that federal appropriations law barred it from providing bottled water. The arbitrator said that looking to federal appropriations law “would be looking outside of the Collective Bargaining Agreement between the parties.” Id. at 9.
The Navy filed exceptions to the arbitration award with the Federal Labor Relations Authority. See 5 U.S.C. § 7122(a). As relevant here, the Navy challenged the award on the grounds that (1) the arbitrator refused to consider its argument that federal appropriations law precluded it from providing bottled water, and (2) the arbitrator's findings drew no distinction between NAGE and FUSE, even though only NAGE had a collective bargaining agreement with the Navy. See Agency's Exceptions to Arbitrator Jerome H. Wolfson's June 19, 2008 Award & Opinion at 12, 15, 20, Dep't of the Navy, Naval Undersea Warfare Ctr. Div. Newport, R.I., 64 F.L.R.A. 1136 (2010).
The Authority denied the exceptions and affirmed the arbitrator's conclusion that the Navy was obligated to bargain before removing the bottled water. Dep't of the Navy, Naval Undersea Warfare Ctr. Div. Newport, R.I., 64 F.L.R.A. 1136, 1138–40 (2010). The Authority agreed with the arbitrator's determination that the Navy's “provision of bottled water for many years was an established past practice” at the Newport facilities and thus a “condition of employment,” which the Navy could not change without bargaining with the unions. Id. at 1139. The Authority rejected the Navy's argument that federal appropriations law precluded the Navy from supplying bottled water, stating that “[n]one of the Comptroller General decisions ... permits unilateral termination of a practice to provide bottled water.” Id. The Navy petitioned for review in this Court.
Before reaching the merits of the Navy's arguments, we first consider whether we have jurisdiction to review the Authority's decision. To simplify the jurisdictional question: If the Authority's decision was based solely on the collective bargaining agreement between the Navy and NAGE, then we do not have jurisdiction. But if the Authority's decision was based on the Navy's statutory bargaining obligations, and not solely on the Navy's obligations under the collective bargaining agreement, then we do have jurisdiction. We conclude that the Authority's decision was based on the Navy's statutory bargaining obligations, not on the collective bargaining agreement. We therefore have jurisdiction.
The Federal Service Labor-Management Relations Statute establishes a two-track system for resolving labor disputes between federal agencies and government employee unions. See Overseas Educ. Ass'n v. FLRA ( OEA), 824 F.2d 61, 62 (D.C.Cir.1987). The first track permits a union alleging an unfair labor practice, as defined in 5 U.S.C. § 7116, to file a charge with the General Counsel of the Federal Labor Relations Authority. The General Counsel must investigate the charge and may commence an administrative proceeding against the agency if the charge has merit. 5 U.S.C. § 7118(a)(1)-(2). The Authority's resolution of a charge is subject to judicial review in the courts of appeals. 5 U.S.C. § 7123(a).
The second track—the track chosen by the unions in this case—is binding arbitration. Every collective bargaining agreement between an agency and a union must include a negotiated grievance procedure, and every grievance procedure must allow a party dissatisfied with the outcome of the grievance negotiations to opt for binding arbitration. 5 U.S.C. § 7121(a)(1), (b)(1)(C)(iii). Once the arbitrator reaches a decision, either party may file exceptions to the arbitrator's award with the Federal Labor Relations Authority. 5 U.S.C. § 7122(a). The Authority reviews the arbitration award to ensure that it is not “contrary to any law, rule, or regulation,” or otherwise deficient on any ground “similar to those applied by Federal courts in private sector labor-management relations.” Id.
An aggrieved party may elect either track—the statutory complaint procedure or binding arbitration—but not both. 5 U.S.C. § 7116(d).
When the aggrieved party chooses the second track,...
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