Department of Defense, Department of the Army, McAlester Army Ammunition Plant and American Federation of Government Employees, Local 2815 (Authority decision, March 13, 1987)

Final FLRA decision. This is a final order of the Federal Labor Relations Authority finding unfair labor practices under 5 U.S.C. § 7116. An aggrieved person may seek judicial review by filing a petition in an appropriate United States court of appeals within 60 days after issuance under 5 U.S.C. § 7123(a). Filing a petition does not stay the Authority's order unless the court orders a stay under 5 U.S.C. § 7123(c).

Plain-English summary

McAlester Army Ammunition Plant ended its longstanding practice of handing employees their paychecks at work and began mailing them instead. AFGE Local 2815 requested bargaining, but the plant treated paycheck delivery as a management decision outside the duty to bargain. Following a court remand, the Authority reversed its earlier dismissal of the complaint. It held that the delivery method was a working condition and that using the Postal Service was not a contracting out decision reserved to management. The Authority found unfair labor practices and ordered the plant to restore on site delivery, give notice, and bargain on request before future changes.

Decision snapshot

• Authority: Unfair labor practices under 5 U.S.C. § 7116(a)(1) and (5); management rights under § 7106.
• Outcome: Prior dismissal reversed; violations found; on site delivery restored and future bargaining ordered.
• Key point: An agency must bargain before changing an established paycheck delivery practice when no statutory exception applies.

Full text (FLRA public release)

[ v26 p177 ]

26:0177(20)CA

The decision of the Authority follows:

26 FLRA No. 20

UNITED STATES DEPARTMENT OF DEFENSE
DEPARTMENT OF THE ARMY
McALESTER ARMY AMMUNITION PLANT
Respondent

and

AMERICAN FEDERATION OF GOVERNMENT
EMPLOYEES,LOCAL 2815, AFL-CIO
Charging Party

Case No. 6-CA-1041
(20 FLRA No. 73)

DECISION AND ORDER ON REMAND

I. Introduction

This case is before the Authority pursuant to a remand from the United States Court of Appeals for the District of Columbia Circuit. The court granted the Authority's unopposed motion and remanded the case for further consideration in the light of the decision in the Ninth Circuit in Federal Employees Metal Trades Council v. FLRA, 778 F.2d 1429 (9th Cir. 1985) (FEMTC). In FEMTC, the court reversed and remanded the Authority's determinations in Federal Employees Metal Trades Council, AFL-CIO and Department of the Navy, Mare Island Naval Shipyard, Vallejo, California, 16 FLRA 619 (1984), and American Federation of Government Employees, Local 1533 and Department of Navy, Navy Commissary Store Region, Oakland, and Navy Commissary Store, Alameda, California, 16 FLRA 623 (1984). In those cases, the Authority had determined that proposals concerning paycheck distribution were outside the duty to bargain because they concerned the methods and means of performing work under section 7106(b)(1) of the Federal Service Labor-Management Relations Statute (the Statute).

Following the court's remand in FEMTC, we issued our Decision and Order on Remand in Federal Employees Metal Trades Council, AFL-CIO and Department of the Navy, Mare Island Naval Shipyard, Vallejo, California, 25 FLRA No. 31 (1987). (Mare Island Naval Shipyard). In Mare Island Naval Shipyard, we reviewed and reversed the Authority's previous decision that the method of paycheck distribution concerned the methods and means of performing work. We concluded that paycheck delivery does not involve methods and means of performing work within the meaning of section 7106(b)(1) of the Statute. We also concluded that: (1) the proposals related to matters affecting working conditions of bargaining unit employees; (2) the Agency failed to demonstrate a compelling need for its regulations to bar negotiations on the proposals; (3) the proposal did not interfere with the Agency's right to determine its budget or organization; and (4) the proposals were not directly or integrally related to the assignment of work or to determination as to the personnel by which the Agency's operations were to be conducted.

Consistent with our decision in Mare Island Naval Shipyard, we conclude in this case that the United States Department of Defense, Department of the Army, McAlester Army Ammunition Plant (Respondent) committed unfair labor practices when it failed and refused to bargain with the Union concerning a proposed change in the method of paycheck distribution. Accordingly, we reverse the Authority's previous decision in this case, United States Department of Defense, Department of the Army, McAlester Army Ammunition Plant, 20 FLRA No. 73 (1985).

II. History of the Case

A. Facts

The record indicates that since 1941, when the plant was opened, employees had the option of receiving their paychecks on the premises or having them mailed, either to a home address or to a bank. The record further indicates that in 1981, at the time of the alleged change, more than 90 percent of the 700 employees at the plant received their paychecks on the premises. In February 1981, there were rumors at the plant of a proposed change in the method of paycheck delivery. On February 18, 1981, a meeting was held between the Respondent and the Union to discuss a proposed change in the delivery of paychecks. The Respondent presented a chart which reflected the savings that could be achieved by mailing paychecks. The Union expressed opposition to the change. However, there was a dispute as to the final outcome of the discussion. The Respondent alleged that the Union agreed to the change while the Union strongly denied that it had agreed. It was decided at the meeting to poll the employees. The employees were polled on February 19 and 99 percent of the employees opposed the change. On that same day, the Union made a request to negotiate over the issue. A meeting was held on March 2 to discuss the change further. At that time, the Respondent stated that the issue was not negotiable and that it would not consider negotiating with the Union since the means of delivering paychecks was a management right. On March 12, 1981, the employees were informed that beginning with the pay period on March 17, 1981, paychecks were to be mailed and hand delivery on the premises would cease.

B. Administrative Law Judge's Decision

The Judge found that the established practice of the hand delivery of employees' paychecks on the premises was a condition of employment and that the Respondent's decision to change this established condition of employment was not excepted from the obligation to bargain by section 7106 of the Statute. The Judge concluded that the Respondent violated section 7116(a)(1) and (5) of the Statute by the failure and refusal to bargain in good faith with the Union prior to announcing to all employees its decision to change the existing practice of the hand delivery of paychecks, and prior to the implementation of its decision on March 17, 1981.

C. Authority's Decision in 20 FLRA No. 73

In its original decision in this case, the Authority followed the precedent established in the original Mare Island Naval Shipyard case, 16 FLRA 619. The Authority concluded that the Respondent's notice to the Union of its intent to change the method of paycheck delivery concerned a matter negotiable only at the election of the agency under section 7106(b)(1) of the Statute. The Authority found that the Respondent's refusal to bargain concerning its decision in effect constituted notice to the Union that the Respondent would no longer be bound by the provision concerning the permissive subject of bargaining in the parties' agreement. The Authority concluded that the Respondent's refusal to bargain concerning a change in the method of paycheck delivery did not constitute a violation of section 7116(a)(1) and (5) of the Statute. Accordingly, the Authority dismissed the unfair labor practice complaint in its entirety.

III. Analysis and Conclusion

With the exception of one additional assertion, the Respondent's arguments made in this unfair labor practice case are the same arguments that were presented in Mre Island Naval Shipyard. We fully considered those arguments in our decision on remand in that case. Accordingly, for the reasons stated in that decision, we reject the Respondent's contention in this case that the method of paycheck distribution is not within its duty to bargain. As to the Respondent's additional argument, we find, in agreement with the Judge, that the Respondent's decision to mail paychecks using the facilities of the U.S. Postal Service, did not constitute a determination "with respect to contracting out" within the meaning of section 7106(a)(2)(B) of the Statute. Therefore, we find in agreement with the Judge that the Respondent's refusal to bargain with the Union over the proposed change in the method of paycheck distribution violated section 7116(a)(1) and (5) of the Statute.

ORDER

The United States Department of Defense, Department of the Army, McAlester Army Ammunition Plant shall:

1. Cease and desist from:

(a) Instituting any change in the established policy and practice of the hand delivery of employee paychecks on the premises without first notifying the American Federation of Government Employees, Local 2815, AFL-CIO, the exclusive representative of its employees, and affording such representative the opportunity to negotiate in good faith, to the extent consonant with law, regulations and the Statute, prior to any decision concerning such policy and practice.

(b) In any like or related manner, interfering with, restraining, or coercing its employees in their rights assured by the Statute.

2. Take the following affirmative action in order to effectuate the
   purposes and policies of the Statute:

(a) Rescind its memorandum of February 19, 1981, entitled Subject: "Mailing Payroll Checks" which was unlawfully implemented on March 17, 1981.

(b) Reinstate the policy and practice of the hand delivery of paychecks on the premises as it existed prior to February 19, 1981.

(c) Notify the American Federation of Government Employees, Local 2815, AFL-CIO of any proposed change regarding the hand delivery of paychecks on the premises and, upon request, negotiate with such representative to the extent consonant with law and regulations on any such proposal.

(d) Post at its facility at the McAlester Army Ammunition Plant, McAlester, Oklahoma, copies of attached Notice on forms to be furnished by the Federal Labor Relations Authority. Upon receipt of such forms, they shall be signed by the Commanding Officer, McAlester Army Ammunition Plant and shall be posted for 60 consecutive days thereafter in conspicuous places, including all bulletin boards and other places where notices to employees are customarily posted. Reasonable steps shall be taken to ensure that the Notices are not altered, defaced, or covered by any other material.

(e) Pursuant to section 2423.30 of the Federal Labor Relations Authority's Rules and Regulations, notify the Regional Director, Region VI, in writing, within 30 days from the date of this Order, what steps have been taken to comply with this Order.

Issued, Washington, D.C., March 13, 1987.

/s/ Jerry L. Calhoun, Chairman
/s/ Henry B. Frazier III, Member
/s/ Jean McKee, Member
FEDERAL LABOR RELATIONS AUTHORITY

NOTICE TO ALL EMPLOYEES

PURSUANT TO A DECISION AND ORDER OF THE FEDERAL LABOR RELATIONS AUTHORITY AND IN ORDER TO EFFECTUATE THE POLICIES OF CHAPTER 71 OF TITLE 5 OF THE UNITED STATES CODE

FEDERAL SERVICE LABOR-MANAGEMENT RELATIONS

WE HEREBY NOTIFY OUR EMPLOYEES THAT:

WE WILL NOT institute any change in the established policy and practice of the hand delivery of employee paychecks on the premises without first notifying the American Federation of Government Employees, Local 2815, AFL-CIO, the exclusive representative of our employees, and affording it the opportunity to negotiate in good faith, to the extent consonant with law and regulations, prior to any decision concerning such policy and practice.

WE WILL NOT in any like or related manner, interfere with, restrain or coerce our employees in the exercise of their rights assured by the Federal Service Labor-Management Relations Statute.

WE WILL rescind and withdraw our memorandum of February 19, 1981 entitled, Subject: "Mailing Payroll Checks" which was unlawfully implemented on March 17, 1981.

WE WILL FORTHWITH reinstate the policy and practice of the hand delivery of payroll checks on the premises as it existed prior to February 19, 1981.

WE WILL notify the American Federation of Government Employees, Local 2815, AFL-CIO, of any proposed change regarding the hand delivery of paychecks on the premises and will, upon request, negotiate with such representative, to the extent consonant with law and regulations, on any such proposal. (Agency or Activity)

Dated: . . . By: (Signature)

This Notice must remain posted for 60 consecutive days from the date of posting, and must not be altered, defaced, or covered by any other material.

If employees have any questions concerning this Notice or compliance with any of its provisions, any employee may communicate directly with the Regional Director, Region VI, Federal Labor Relations Authority, whose address is 525 Griffin Street, Suite 926, Dallas, Texas 75202 and whose telephone number is: (214) 767-4996.