Opposition Brief — FortStewart Schools v. FLRA

IN THE

Supreme Court of the United States

OCTOBER TERM, 1989

Fort STEWART SCHOOLS,

" Petitioner

FEDERAL LABOR RELATIONS AUTHORITY AND

Fort STEWART ASSOCIATION OF EDUCATORS

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Eleventh Circuit

BRIEF FOR RESPONDENT

FORT STEWART ASSOCIATION OF EDUCATORS

IN OPPOSITION

RICHARD J. HIRN *

400 North Capitol Street

Suite 326

Washington, D.C. 20001

(202) 783-3132

RONALD R. AUSTIN

1201 Sixteenth Street, N.W.

Suite 210

Washington, D.C. 20036

* Counsel of Record (202) 822-7850

WILOON - Eres Printing Co., Inc. - 789-0006 - WasnincTron, D.C. 20001

® 0

50

2

TABLE OF CONTENTS

Page

REASONS FOR DENYING THE PETITION 1

IESE SD EE A a oe Y a 22

APPENDIX, Staff Report on the President’s Panel on

Federal Compensation, 159-162 (1976) * — 1a

TABLE OF AUTHORITIES

Cases:

American Federation of Government Employees

and Department of the Air Force, Eglin Air

Force Base, 24 F.L.R.A. 877 (1980) 2

Army and Air Force Exchange Service, Dallas,

Texas and AFGE, 32 F.L.R.A. 591 (1988 4,16

Bureau of Alcohol, Tobacco and Firearms v. FLRA,

1 11

Department of Defense Dependents Schools v.

FLRA, 863 F.2d 988 (D.C. Cir. 1988), reh’g en

bane granted (Feb. 6, 19899999)999999292 2, 4, 7, 8

Department of the Navy, Military Sealift Com-

mand v. FLRA, 836 F.2d 1409 (3rd Cir. 1988). 3,4

Department of the Treasury, Bureau of Engrav-

ing and Printing v. FLRA, 838 F.2d 1314 (D.C.

e 4

Florida National Guard v. FLRA, 699 F.2d 1082

le i EE REE ST ELE ERA 12

Fort Stewart Schools v. FLRA, 860 F.2d 396

EES EE EI tee aa ie a a I 1, 13, 15

Goodyear Atomic Corp. v. Miller, 108 S.Ct. 1704

NE SE SAS nae ee, SSE 12

Lorillard v. Pons, 434 U.S. 3 — — 12

National Treasury Employees Union v. FLRA, 691

CE SS 11

New York Council, Association of Civilian Tech-

nicians v. FLRA, 757 F.2d 502 (2d Cir. 1985),

cert. denied, 474 U.S. 846 (1980) 11

Nuclear Regulatory Commission v. FLRA, No. 87-

$182 (4th Cir. July 14, 19899 5

ii

TABLE OF AUTHORITIES—Continued

Overseas Education Association, Inc. and Depart-

ment of Defense Dependents Schools, 6 F.L.R.C.

1111%ü Se

United Federation of College Teachers, Local 1460

and U.S. Merchant Marine Academy, 1 F. L. R. C.

ee 8

U.S. Department of Energy, Western Area Power

Administration, Golden, Colorado and IBEW

Locals 640, et al., 22 F.L.R.A. 758 (1986) 8

United States v. PATCO, 653 F.2d 1134 (7th Cir.

——ů — — — — W 12

Statutes and regulations:

Civil Rights Act of 1960, Pub. L. No. 86-449, Title

ANI 20

S... 70k» aa 18

jf — . . eS 18

0 4, 5, 15, 16, 17

Classification Act, 5 U.S.C. 5102 4

Prevailing Rate Act:

RTL SE 15, 16

TTT / RES 3

Ec 3

Federal Employee Pay Act, 5 U.S.C. 5541-5550 16

Federal Service Labor-Management Relations

Statute:

D.. ee 5

OK , 4,8

)} eS 3,18

JJ... — . 6

11111 — ee 4,16

ff 00 10

;˙’ö . . lilies 17

r SS ee 17

0 n. . are 19

5 U.S.C. 7119 ()) — — 18

5 U.S.C. 7121 (a) () —ü— 6

— —

iii

TABLE OF AUTHORITIES—Continued

Page

V .. 21

rr ...... 21

Uniformed Services Health Professions Revitali-

zation Act of 1972, 10 U.S.C. 2113(f) W 3

Federal Deposit Insurance Act, 12 U.S.C. 1819 5

r .. 2, 19, 20

e “!!... ——— 20

Overseas Teachers Pay and Personnel Practices

e 3, 10, 11

Panama Canal Amendments Act of 1985, 22 U.S.C.

e castspercmeentonntepenmecmnccs 3

National Labor Relations Act:

ES SE 7

rr aesnneeenenes 7

rr cnescoansncetons 7

Taft-Hartley Act, Pub. L. No. 429, ch. 782, § 201,

63 Stat. 954 (Oct. 29, 19499 8

Atomic Energy Act, 42 U.S.C. 2201 (d — 5

Marine Education and Training Act of 1980, 46

ES 5

GA. ANN. CODE § 47-8-1 et Sg 21

GA. ANN. CODE § 20-2-880 et se 21

5 C. F. R. § 2424.11 (a), (e) 3 19

r 18

Miscellaneous:

124 Cong. Rec. (1978)

. 13

r 13

e 17

e 11, 14

. 14

. 14

r 11, 15

D 12

e antarnetpncrenmemsemmeceneee 11

124 Cong. Rec. H8468 (daily ed. Aug. 11, 1978) 12

F. Evxourt & E. ELKourI, How ARBITRATION

_ Works (4th ed. 1985) 18

iv

TABLE OF AUTHORITIES—Continued

Page

Executive Order No. 10,988, 27 Fed. Reg. 551

r Pee wale Sh eR 10

Executive Order No. 11,491, 43 Fed. Reg. 17605

| TS RAO He SEL Beas Re 10, 11, 12, 13, 14

Hearings pursuant to H. Res. 115 before the Spe-

cial Subcomm. of the House Comm. on Educa-

tion and Labor, 83 Cong., Ist Sess. (1953) 19

House Comm. on Post Office and Civil Service,

Subcomm. on Postal Personnel and Moderniza-

tion, 96th Cong., Ist Sess., Legislative History

of the Federal Service Labor Management Rela-

Rer. 9

H.R. Rep. No. 95-1403, 95th Cong., 2d Sess.

ERR SESE WIE PS ALE Ses re 11

H.R. Rep. No. 95-1717, 95th Cong., 2d Sess.

r ae Ca ee ee 17

T. KHEEL, LABOR LAW (1979) 8

OFFICE OF PERSONNEL MANAGEMENT, UNION REC-

OGNITION IN THE FEDERAL GOVERNMENT (1987) ..2, 5, 16

PRESIDENTS TASK FORCE ON EMPLOYEE-

MANAGEMENT RELATIONS IN THE FEDERAL SER-

VICE, A POLICY FOR EMPLOYEE-MANAGEMENT Co-

OPERATION IN THE FEDERAL SERVICE (1961) .._.... 9

S. Rep. No. 95-969, 95th Cong., 2d Sess. (1978).... 11

1960 U.S. CopE CoNd. & AD. NEWS 1946, 1950 20

1962 U.S. CopE Conc. & AD. NEWs 4269, 4271 10

1978 U.S. CopE Conca. & AD. NEWS 282%ſif 11

IN THE

Supreme Court of the United States

OCTOBER TERM, 1989

No. 89-65

ForT STEWART SCHOOLS,

0 Petitioner

FEDERAL LABOR RELATIONS AUTHORITY AND

FoRT STEWART ASSOCIATION OF EDUCATORS

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Eleventh Circuit

BRIEF FOR RESPONDENT

FORT STEWART ASSOCIATION OF EDUCATORS

IN OPPOSITION

REASONS FOR DENYING THE PETITION

Review is not warranted because the court below cor-

rectly decided the issues presented here and because the

issues are of relatively minor importance in light of the

small number of federal employees impacted by this and

other decisions concerning the right of federal employees

to negotiate over wages.

1. The Eleventh Circuit’s decision in Fort Stewart

Schools will not have a significant impact because of the

small number of teachers employed by the Army’s Section

6 schools. There are only 187 teachers and teacher aides at

Fort Stewart whose bargaining rights are affected. There

2

are 50 teachers at the West Point Elementary School who

bargain collectively, 14 at Fort Rucker, 245 at Fort Bragg

and 240 at Fort Knox. OFFICE OF PERSONNEL MANAGE-

MENT, UNION RECOGNITION IN THE FEDERAL GOVERN-

MENT, 155, 175, 198 (1987). The teachers at the other

Section 6 schools administered by the Army at Fort Jack-

son, Fort Campbell, Fort Benning and Fort McClellan are

not organized. There are also 110 teachers who bargain

collectively with the Marine Corps, which administers a

Section 6 school at Quantico, Virginia. UNION RECOG-

NITION at 291. The teachers who bargain collectively

at the Section 6 schools administered by the Navy in

Puerto Rico have not sought to negotiate over pay be-

cause 20 U.S.C. § 241(a) specifically provides that teach-

ers employed at Section 6 schools outside the continen-

tal United States are to be paid the same as teachers in

the District of Columbia public schools.

There are not “forty-odd” categories of federal employ-

ees whose salary is not fixed by statute and who will be

able to negotiate over wages under the Federal Labor

Relations Authority’s decisions, such as the one enforced

by the Eleventh Circuit. They are not “a large and di-

verse group” as the petitioner characterizes them but

represent considerably less than 1% of the federal work-

force.

The reference to “forty-odd pay systems which are not

entirely fixed by statute” that appears in the Fort

Stewart Schools’ petition and in Department of Defense

Dependents Schools v. FLRA, 863 F.2d 988, 989 (D.C.

Cir. 1988), reh’g en bane granted (Feb. 6, 1989), is a

citation to American Federation of Government Em-

ployees and Department of the Air Force, Eglin Air Force

Base, 24 F. L. R. A. 377 (1986), in which Authority Chair-

man Calhoun apparently refers to a 1976 Staff Report

of the President's Panel on Federal Compensation that

identifies forty-three “administratively determined salary

schedules” and “wage schedules.” However, included on

that list, which is reproduced in the appendix to this

brief, are employees of agencies now defunct, such as the

Energy Research and Development Administration and

the Alaska Railroad. The list also includes employees of

the Tennessee Valley Authority, the Central Intelligence

Agency, the National Security Agency and the Federal

Bureau of Investigation, which are excluded from cover-

age of the Federal Service Labor-Management Relations

Statute by 5 U.S.C. § 7103 (a) (3). Also included on this

list are categories of supervisory or managerial employees

who do not bargain under the FSLMR Statute, along

with numerous categories of temporary employees and

those who would not constitute separate bargaining units.

Finally, the list also includes five categories of employees

who are “prevailing rate employees.” That is to say,

they are employees whose pay is fixed by either the Pre-

vailing Rate Act or a similar law that requires their

employing agency to compensate them in accordance with

the prevailing rate of wages paid to similar employees in

the private sector.“ Both courts that have considered

See Department of the Navy, Military Sealift Command v

FLRA, 836 F.2d 1409, 1417 n.15 (3rd Cir. 1988).

2 Such as the chief examiners of the Board of Patent Appeals.

Such as temporary census takers, noncitizen wage earners, stu-

dent medical interns, Youth Employment Program workers and

Justice Department special attorneys. The list also includes experts

and consultants employed by individual personal service contracts

who are covered by procurement laws instead of the FSLMR

Statute.

* E.g., Panama Canal employees, 22 U.S.C. § 3655(b) ; the civilian

staff at the Uniformed Services University of Health Services, 10

U.S.C. § 2113 (f); Bureau of Printing and Engraving employees,

5 U.S.C. § 5349; maritime employees, 5 U.S.C. § 5348; and em-

ployees in the federal wage grade system, 5 U.S.C. chapter 53,

subchapter IV. The Overseas Teachers Pay and Personnel Practices

Act, 20 U.S.C. § 901 et seg., requires the Secretary of Defense to

set the “basic compensation“ of teachers in DOD’s overseas de-

4

the question have ruled that the salaries of prevailing

rate employees are “matters [that] are specifically pro-

vided for by Federal statute” and are thus outside the

duty to bargain under § 7103(a) (14) (c) of the FSLMR

Statute, regardless of whether they would otherwise be a

bargainable “condition of employment.” Department of

the Treasury, Bureau of Engraving and Printing v.

FLRA, 838 F.2d 1341 (D.C. Cir. 1988); Military Sea-

lift Command. The Federal Labor Relations Authority

has now adopted that interpretation and has held that

pay proposals made by prevailing rate employees are non-

negotiable, unless the employees are specifically covered

by a “grandfather clause” in § 704 of the Civil Service

Reform Act, which allows those prevailing rate employees

who negotiated over wages before the enactment of the

Prevailing Rate Act in 1972 to continue to do so. Army

and Air Force Exchange Service, Dallas, Texas and

AFGE, 32 F.L.R.A. 591 (1988).

The Classification Act exempts only twenty-seven cate-

gories of employees and nine agencies from its coverage

and thus provides a more reliable and current indication

of the number of categories of employees whose pay is not

fixed by statute. 5 U.S.C. § 5102. Most of the categories

of employees excluded from the Classification Act, how-

ever, are either employed in an agency also excluded from

the coverage of the FSLMR Statute by § 7103 (a) or

covered by some form of prevailing rate law or individual-

ized pay statute.

In short, the numbers of federal employees whose pay is

truly within administrative discretign and who have col-

lective bargaining rights are few. 1 addition to teachers

and staff in DOD dependents schools, the only other federal

pendents schools in accordance with the range of rates paid to

teachers in stateside urban school districts. The issue of whether

these teachers can negotiate over extra-duty and summer-school

compensation is pending in Department of Defense Dependents

Schools.

5

employees who are asserting bargaining rights on pay

issues are those prevailing rate employees covered by the

grandfather clause of § 704 (whose bargaining rights are

not in dispute) ; a unit of 74 faculty members at the U.S.

Merchant Marine Academy at Kings Point, New Vork;

six units totalling 1,141 employees of the Federal De-

posit Insurance Corporation; and a unit of approximately

2,190 employees of the Nuclear Regulatory Commission.

UNION RECOGNITION at 393, 409, 434. However, the

Court of Appeals for the Fourth Circuit recently held

en banc that NRC employees may not negotiate over pay

because, inter alia, the Atomic Energy Act, 42 U.. C.

§ 2201(d), grants the Commission only limited authority

—te-—deviate from the Classification Act in setting pay

rates. Nuclear Regulatory Commission v. FLRA, No.

87-3182 (4th Cir. July 14, 1989).

2. The court of appeals decided each of the three

questions in this case correctly.

a. An examination of the language of the FSLMR

Statute reveals that wages are a negotiable condition of

employment unless they are specifically provided for by

statute. Federal employees have the right “to engage in

collective bargaining with respect to conditions of em-

ployment.” 5 U.S.C. § 7102. “Conditions of employment”

is in turn defined as:

. personnel policies, practices, and matters,

whether established by rule, regulation, or otherwise,

5 The Maritime Education and Tra ning Act of 1980 provides

that the Secretary of Transportation may employ faculty at the

academy without regard to the provisions of Title 5 and may pay

faculty members “without regard to the provisions of chapter 51

and subchapter III of chapter 53 of such title (relating to classifi-

cation and General Schedule pay rates).” 46 U.S.C. § 1295g(d).

Congress has granted to the FDIC the power “to appoint by its

Board of Directors such officers and employees as are not otherwise

provided for in this chapter, to define their duties [and] fix their

compensation. . 12 U.S.C. § 1819.

affecting working conditions, except that such term

does not include policies, practices and matters—

(A) relating to political activities prohibited

under subchapter III of chapter 73 of this title;

(B) relating to the classification of any posi-

- tion; or

(C) to the extent such matters are specifically

provided for by Federal statute.

5 U.S.C. § 7103 (a) (14). Nowhere is the right to nego-

tiate wages excluded from the definition of “conditions

of employment” unless the employee’s wages “are spe-

cifically provided for by Federal statute.” If Congress

intended to exclude bargaining on wages under all cir-

cumstances, it could easily have included wages among

these three exclusions or phrased exclusion (B) to read

“relating to the pay and classification of any position.”

It would be specious to suggest, as petitioner has, that

“working conditions” are limited to the physical circum-

stances under which an employee performs his job, such

as job safety and office environment. This would exclude

the bulk of subject matters presently negotiated by fed-

eral sector unions, including personnel policies and prac-

tices involving equal employment opportunity, merit pro-

motion, training and career development, work schedul-

ing, discipline, and the negotiation of grievance and arbi-

tration procedures made mandatory by § 7121(a) (1). If

Congress had intended the definition of “conditions of

employment” to be so limited, there would have been no

need to exclude from the definition “political activity”

and “position classification.” How can it be said that

pay is not a working condition but that position classifi-

cation, from which pay flows for most federal employees,

is?

An examination of the language of the Nationa] Labor

Relations Act also demonstrates that an employee’s pay

is both a “working condition” and a “condition of em-

7

ployment” in common and Congressional parlance. In the

third paragraph of Section 1 of the NLRA, “Findings

and declaration of policy,” 29 U.S.C. § 151, Congress spe-

cifically cites wages and hours as two of the working

conditions over which collective bargaining should take

place:

Experience has proved that protection by law of

the right of employees to organize and bargain col-

lectively safeguards commerce from injury, impair-

ment or interruption, and promotes the flow of com-

merce ... by encouraging practices fundamental to

the friendly adjustment of industrial disputes aris-

ing out of differences as to wages, hours or other

(emphasis supplied). In Section 9(a) of the NLRA, 29

U.S.C. § 159, Congress included rates of pay and wages

as examples of the conditions of employment over which

exclusive representatives had the right to bargain:

Representatives designated or selected for the pur-

poses of collective bargaining by the majority of

employees in the unit appropriate for such purposes,

shall be the exclusive representatives of all the em-

ployees in such unit for the purposes of collective

bargaining in respect to rates of pay, wages, hours

of employment, or other conditions of employment:

(emphasis supplied). The use by Congress of the words

“or other” between “wages” and “working conditions”

and between “rates of pay, wages” and “conditions of

employment,” rather than simply the word “or,” demon-

strates that Congress considered the latter term to en-

compass the former.’

In Department of Defense Dependents Schools, Judge Starr

quoted the language of § 8(d) of the NLRA, 29 U.S.C. § 158 (d),

which requires both unions and employers to negotiate in good

faith over “wages, hours and other terms and conditions of em-

ployment,” and concluded, without reference to any authority, that

b. The origin of the phrase “personnel policies, prac-

tices and matters . . affecting working conditions” in

§ 7103 is no mystery. It was adopted verbatim from the

earlier Executive orders governing collective bargaining

in the federal sector. The FLRA’s predecessor, the Fed-

eral Labor Relations Council, held that wages were a ne-

gotiable working condition for employees whose compen-

sation was not set by statute. The legislative history of

the FSLMR Statute demonstrates that Congress’s primary

intent in enacting the statute was to codify the prac-

tices that arose under the Executive orders that had

governed labor relations in the federal sector without any

diminution in the scope of bargaining.

There is a long history of collective bargaining over

wages in the federal sector. At least as early as 1949,

Congress exempted skilled craftsmen and semiskilled

manual laborers from the Classification Act, which set

federal employees’ pay. Pub. L. No. 429, ch. 782, § 201,

63 Stat. 954 (Oct. 28, 1949). The Bureau of Reclamation

in the Department of Interior voluntarily bargained over

wages for such employees with such unions as the IBEW

since the late 1940s. U.S. Department of Energy, West-

ern Area Power Administration, Golden Colorado and

IBEW Locals 640, et al., 22 F. L. R. A. 758, 802-803 (1986).

In 1961, President Kennedy appointed a task force,

chaired by Secretary of Labor Arthur Goldberg, to formu-

wages were a negotiable term, but not a condition, of employment.

863 F.2d at 991 n.3. This faulty analysis ignored the fact that

wages are referred to only as a condition of employment in the

following section of the NLRA, and the fact that §8(d) was not

added to the NLRA until the Taft-Hartley amendments of 1947,

some fourteen years after the NLRA was originally enacted as the

Wagner Act of 1933. Congress added §8(d) in order to impose a

mutual obligation to bargain in good faith on both employers and

unions, where the Wagner Act imposed such a duty on the em-

ployer only. T. KHEeL, 4 LaBor Law §16.02[2] (1979). Section

8(d) did not change the scope or subject matter of bargaining in

any way.

late recommendations on a governmentwide labor rela-

tions policy. The task force reported that numerous agen-

cies had voluntarily recog.ized employee organizations

and that the Tennessee Valley Authority and several com-

ponents of the Department of Interior had developed

“relationships that are close to full scale collective bar-

gaining“ with trade unions. PRESIDENT’Ss TASK FORCE ON

EMPLOYEE-MANAGEMENT RELATIONS IN THE FEDERAL

SERVICE, A POLICY FOR EMPLOYEE-MANAGEMENT Coop-

ERATION IN THE FEDERAL SERVICE (1961) reprinted in

House Comm. on Post Office and Civil Service, Subcomm.

on Postal Personnel and Modernization, 96th Cong., Ist

Sess., Legislative History of the Federal Service Labor-

Management Relations Statute, 1187 (1979). The task

force’s report noted that [t] he employer in most parts

of the Federal Government cannot negotiate on pay, hours

of work or most fringe benefits“ because [t] hese are

established by law.” Jd. at 1200. The task force recom-

mended a government-wide labor relations program that

would permit bargaining over wages if not otherwise set

by statute:

Specific areas that might be included among sub-

jects for consultation and collective negotiations in-

clude the work environment, supervisor employee re-

lations, work shifts and tours of duty, grievance

procedures, career development policies and where

permitted by law the implementation of policies rel-

ative to rates of pay and job classification.

Id. at 1201 (emphasis added).

In a statement accompanying the published version of

the task force report, President Kennedy directed that an

Executive order be prepared to effectuate the task force’s

recommendations and noted “that where salaries and

other conditions of employment are fixed by the

these matters are not subject to negotiation.” Jd. at 1178.

Thus, those who developed the first government-wide labor

relations program intended that “salaries” were to be

10

among the negotiable “conditions of employment” unless

they were set by Congress.

Section 6(b) of Executive Order No. 10,988, 27 Fed.

Reg. 551 (1962), reprinted in 1962 U.S. Cope Conca. &

Ab. NEws 4269, 4271, issued by President Kennedy, au-

thorized negotiations over “personnel policy and practices

and matters affecting working conditions“ —the same

language that now appears in the FSLMR Statute at 5

U.S.C. § 7104 (14). President Nixon revised the federal

government’s labor relations program by Executive Order

No. 11,491, 43 Fed. Reg. 17605 (1969). Section 11 of this

Executive order required agencies to negotiate “with re-

spect to personnel policies and practices and matters af-

fecting working conditions, so far as may be appropriate

under applicable laws and regulations. . . Section 4 of

Executive Order No. 11,491 established the Federal Labor

Relations Council, comprised of the chairman of the Civil

Service Commission, the Secretary of Labor, and an OMB

official, and authorized it to resolve disputes governing

the negotiability of collective bargaining proposals.

In 1972 the FLRC was called upon to resolve a nego-

tiability dispute concerning the Department of Com-

merce’s obligation to negotiate over a wage increase for

professors at the Merchant Marine Academy. In United

Federation of College Teachers, Local 1460 and U.S.

Merchant Marine Academy, 1 F. L. R. C. 211 (1972), the

FLRC found that instructors at the academy were exempt

from the Classification Act and that their salary proposals

did not conflict with other federal law, as was alleged by

the Department of Commerce. The FLRC specifically

held that the two wage proposals at issue were “negotia-

ble as ‘personnel policies and practices and matters affect-

ing working conditions’ under section 1ll(a) of the

Order.” 1 F. L. R. C. at 218. In another case, the FLRC

held that several pay proposals made by another teachers’

association were negotiable under Executive Order No.

11,491 because they did not conflict with the Overseas

11

Teachers Pay and Personnel Practices Act. Overseas

Education Association, Inc. and Department of Defense

Dependents Schools, 6 F. L. R. C. 231 (1978).

The enactment of the FSLMR Statute in 1978 “consti-

tute[d] a strong congressional endorsement of the policy

on which the federal labor relations program had been

based since its creation in 1962.” Bureau of Alcohol, To-

bacco and Firearms v. FLRA, 464 U.S. 89, 103 (1983).

It is clear from the legislative history that Congress in-

tended to expand, rather than constrict, the scope of bar-

gaining that existed under the Executive orders. National

Treasury Employees Union v. FLRA, 691 F.2d 553, 559

(D.C. Cir. 1982) ; New York Council, Association of Civil-

ian Technicians v. FLRA, 757 F.2d 502, 508 (2d Cir.

1985), cert. denied, 474 U.S. 846 (1988) .*

The Senate Report stated that [t] he scope of negotia-

tions under this section is the same as under section

ll(a) of Executive Order 11491.” S. Rep. No. 95-969,

95th Cong., 2d Sess. 104 (1978), reprinted in 1978 U.S.

Cope Conc. & Ab. Nxws at 2826. Representative Der-

winski stated that Title VII was intended to codify the

existing bargaining practices, which developed under the

Executive orders:

During early debate, Representative William Ford termed the

expansion in the scope of bargaining “a very modest, incremental

step.” 124 Cong. Rec. 25,777 (1978). In later debate he stated

that “the scope of bargaining would be substantially broadened

from that permitted agency management under the [Executive

order.” 124 Cong. Rec. 29,198 (1978). Representative Clay stated

that in drafting Title VII of the Civil Service Reform Act, which

became the FSLMR Statute, “the committee intended that the

of bargaining under the act would be greater than that

under the order as interpreted by the [Federal Labor Relations)

Council.” 124 Cong. Rec. 29,187 .

Views to H.R. 11280, H.R. Rep. 95-1403, 95th Cong., 2d Sess. 377

(1978) (Title VII “broaden[s) the scope of bargaining beyond

existing practices.

12

[T]he amendment is simply the administration’s

proposal for a flexible but orderly codification of the

Executive orders which have governed

Federal labor-management relations since 1962. Four

now their successor has offered to codify the system

into statutes which cannot, like Executive orders, be

revoked by the White House at will.

The substance of this amendment closely resem-

bles the original program established by President

Kennedy.

124 Cong. Rec. 29,188 (1978).

Thus, when it enacted the FSLMR Statute, Congress

tive orders—including, in limited circumstances, the right

to bargain over wages. When referring to the right of

prevailing rate employees to negotiate over wages, Rep-

resentative Ford stated, “we should not now be narrowing

the preexisting collective bargaining rights of any group

of Federal employees.” 124 Cong. Rec. H8468 (daily ed.

Aug. 11, 1978) (emphasis added). Congress is generally

presumed to be knowledgeable about existing law perti-

nent to the legislation it enacts. Goodyear Atomic Corp.

v. Miller, 486 U.S. 174, (1988). When Congress adopts

a new law incorporating sections of a prior law, Con-

gress is presumed to know both the judicial and adminis-

trative interpretations of the incorporated law. Lorillard

v. Pons, 434 U.S. 575, 580-81 (1978). When Congress

codified without change language contained in Executive

Order 11,491, it knew of and did not intend a change in

the judicial and executive interpretation of that language.

Florida National Guard v. FLRA, 699 F.2d 1082, 1087

(llth Cir. 1983); United States v. PATCO, 653 F.2d

1134, 1138 (7th Cir. 1981). “One such existing practice

allowed federal employees to negotiate wages in the rare

instances where Congress did not specifically establish

13

wages and fringe benefits.” Fort Stewart Schools, 860

F.2d at 402 (citing United Federation of College Teach-

ers, Local 1460 and U.S. Merchant Marine Academy, 1

F. L. R. C. 211 (1972) and OFA and DODDS, 6 F.L.R.C.

231 (1978) ).

The petitioner has cited and analyzed the legislative

history of the FSLMR Statute out of context. Although

the Senate report does state that Title VII “excludes bar-

gaining on economic matters,” in the paragraphs imme-

diately preceding that statement the Senate report makes

clear that any collective bargaining rights that existed

under Executive Order 11,491 were to be preserved by

the new law:

S. 2640 incorporates into law the existing Fed-

eral employee relations program

The basic, well-tested provisions, policies and ap-

proaches of Executive Order 11491, as amended, have

provided a sound and balanced basis for cooperative

and constructive relationships between labor organi-

zations and management officials. Supplemented by

the Federal Labor Relations Authority to adminis-

ter the program, and expanded arbitration proce-

dures for resolving individual appeals, these mea-

sures will promote effective labor-management rela-

tionships in Federal agencies.

Senate report, id., at 12. Immediately preceding Repre-

sentative Udall’s statement that “we do not permit bar-

gaining over pay,” Mr. Udall also states that the statute

“gives Federal employees greater rights in labor relations

than they have heretofore enjoyed.” 124 Cong. Rec.

25,716 (1978). Similarly, although Representative Clay

stated that “employees still . . . cannot bargain[] over

pay,” he also stated immediately afterward that the stat-

ute adopted a position that “moves slightly beyond” exist-

ing bargaining practices. 124 Cong. Rec. 24,286 (1978).

Although Senator Sasser stated that “Federal employees

may not bargain over pay or fringe benefits,” he was de-

14

scribing, however mistakenly, the practice under Execu-

tive Order 11,491, not the new FSLMR Statute.’

When the legislative history is read in both its im-

mediate and historical context, it is clear that the state-

ments were merely assurances that, as a general rule,

wages would continue to be nonnegotiable for the over-

whelming majority of federal employees whose pay is set

by statute. For example, Representative Ford stated that

“no matters that are governed by statute (such as pay,

money-related fringe benefits, retirement and so forth)

could be altered by a negotiated agreement.” 124 Cong.

Rec. 25,777 (1978). Representative Udall stated that

t here is not really any argument in this bill or in this

title about federal collective bargaining for wages and

fringe benefits and retirement... All these major reg-

ulations about wages and hours and retirement and bene-

fits will continue to be established by law through Con-

gressional action.” 124 Cong. Rec. 29,182 (1978). The

court of appeals correctly concluded that:

A close examination of the Congressional reports

and debates reveals that the FSLMRA’s supporters

made these statements with the understanding that

Congress generally regulates such matters through

its prevailing rate acts, not with the understanding

that the FSLMRA barred all wage negotiations.

Thus, although some legislators’ remarks baldly as-

sert that wages are not negotiable, the above com-

® In context, the quote from Senator Sasser reads:

Currently, Federal labor relations are governed by Executive

Order 11491, as amended. The Executive order establishes the

right of Federal employees to belong to unions and establishes

procedures for the recognition of bargaining units. But the

Federal labor relations program continues to differ in sub-

stantive ways from that of the private sector.

For one, Federal employees are not allowed to strike. Also,

exclusive representatives of Federal employees may not bargain

over pay or fringe benefits.

124 Cong. Rec. 27,549 (1978).

15

ments indicate that the legislators merely were as-

suring their peers that the FSLMRA would not sup-

plant specific laws which set wages and benefits.

Fort Stewart Schools, 860 F.2d at 401.

On the other hand, the legislative history reaffirms the

principle, recognized as early as 1961 by the Goldberg

task force, that any matters that are not specifically pro-

vided for by statute are negotiable. Representati

stated during debate: 8 A

Section 7103‘) (14) (D), removing from subjects

of bargaining those matters specifically provided for

by Federal statute, was adopted by the Committee

and retained in the Udall substitute with the clear

understanding that only matters “specifically” pro-

vided for by statute would be excluded under this

subsection. Thus, where a statute merely vests au-

thority over a particular subject with an agency of-

ficial given discretion in exercising that authority,

the particular subject is not excluded by this sub-

section from the duty to bargain over conditions of

employment.

124 Cong. Rec. 29,187 (1978).

e. The fact that Congress specifically authorized cer-

tain prevailing rate employees to negotiate over pay in

§ 704 of the Civil Service Reform Act of 1978, 5 U.S. C.

§ 5343 note, does not indicate an intention to foreclose

other employees from bargaining over pay. The Prevail-

ing Rate Act, 5 U.S.C. § 5343, provides that the salaries

of certain skilled craftsmen “shall be fixed and adjusted

from time to time as nearly as is consistent with the

public interest in accordance with prevailing rates” paid

to similar crafts in the private sector. As noted earlier,

before the Prevailing Rate Act was enacted in 1972, many

of the skilled craftsmen now covered by the Act nego-

tiated over wages. Section 9(b) of the act, Pub. L. No.

92-392, permitted those employees covered by the Pre-

vailing Rate Act who negotiated over pay prior to its

16

enactment to continue to do so. 5 U.S.C. § 5343 note.

When Congress enacted the Civil Service Reform Act of

1978 it provided in § 704 that those employees who con-

tinued wage negotiations pursuant to §9(b) could con-

tinue to do so notwithstanding the Prevailing Rate Act,

the premium pay provisions of Title 5 and any contrary

provision of the FSLMR Statute.” But not for this

“grandfather” clause, these prevailing rate employees

would no longer be able to negotiate over wages under

the FSLMR Statute because their pay would be a matter

“specifically provided for by Federal statute,” 5 U.S.C.

§ 7103(a) (14) (e), namely the Prevailing Rate Act. In-

deed, the FLRA has held that other Prevailing Rate Act

employees who did not bargain over wages prior to 1972

are now foreclosed from doing so for this reason. Army

and Air Force Exchange Service, Dallas, Texas and

AFGE, 32 F.L.R.A. 591, 597, 600 (1988). Thus, § 704

was needed as an exception to the general rule that em-

ployees whose salaries are set by statute may not nego-

tiate over wages; it has no bearing on the bargaining

rights of those employees who are not subject to a pay-

fixing statute.

Section 704 was also enacted to specifically overrule

the effect of two Comptroller General decisions affecting

Prevailing Rate Act employees, and cannot therefore be

taken as an indication of a desire by Congress to limit,

by omission, the bargaining rights of other employees.

In those decisions, the Comptroller General held that al-

though § 9 (b) exempted employees in certain bargaining

units from the Prevailing Rate Act, the overtime provi-

sions of 5 U.S.C. §§ 5541-5550 were still applicable and

10 There are twenty bargaining units of Prevailing Rate Act

wage grade employees represented by craft unions, such as the

International Brotherhood of Electrical Workers and the Columbia

Power Trades Council, that gained recognition before 1972 and

are thus grandfathered by § 704. UNION RECOGNITION at 331-332,

351-362, 390.

— ee a

17

beyond the scope of bargaining. During debate, Con-

gressman Ford stated:

During committee mark-up, I offered an amend-

ment to add a new provision, section 704(c), which

is intended to preserve the scope of collective bar-

gaining heretofore enjoyed by certain trade and craft

employees . . This provision is required because

of two recent rulings by the Comptroller General

which invalidated certain collectively bargained pro-

visions and held that specific legislative authoriza-

tion is necessary for these employees to continue to

negotiate such provisions in accordance with prevail-

ing private industry practice. Decisions Nos. B-

— (February 3, 1978) and B-191520 (June 6,

124 Cong. Rec. 25722 (1978). See also H.R. Rep. No.

1717, 95th Cong., 2d Sess. 159 (1978). Thus, § 704 was

added to overcome a roadblock to the bargaining rights

of particular employees rather than as an exhaustive list

of those employees who could negotiate over pay issues.

d. If Congress intended employees such as dependents

school teachers to continue to negotiate over wages, it

would not have intended a construction of § 7106(a) (1)

that would foreclose such bargaining. In any case, § 7106

(a) (1) grants management the right to “determine” its

budget. Proposals that merely have an economic cost

without being budget determinative are negotiable. Vir-

tually any collective bargaining proposal has some cost

and impacts an agency’s budget, including arbitration

procedures and negotiations themselves.

The Army has no support for its argument that whether

the union’s proposals would significantly increase costs

should be tested “by comparison with the costs of the

program employing the bargaining unit employees, not

the entire agency budget.” The plain language of the

statute is to the contrary. Section 7106(a) states that

“nothing in this chapter shall affect the authority of any

18

management official of any agency—to determine the .. .

budget . . . of the agency.” (emphasis added). “Agency”

is defined by the statute as “an Executive agency.” 5

U.S.C. § 7103 (a) (3). For the purposes of title 5, Ex-

ecutive agency” means an Executive Department, a Go -

ernment corporation and an independent establishment.

5 U.S.C. § 105. The Department of Defense is an Ex-

ecutive Department and thus an Executive agency; the

Fort Stewart school system is not. 5 U.S.C. § 101.

The union’s proposals do not entail an unavoidable in-

crease in costs, even if judged on a schoolwide basis.

First, presumably the salaries of the teachers in the

Georgia public schools are raised annually. Therefore, at

least part of the 13.5% salary increase sought was going

to be incurred by the agency anyway because the Army

pegs Fort Stewart teachers’ salaries to those paid in local

school districts. Second, higher salaries attract better,

harder-working teachers, which would in turn permit the

Fort Stewart schools to increase the pupil-teacher ratio

slightly without any detriment to the overall quality and

total cost for salaries at Fort Stewart. As an alternative,

other aspects of the Fort Stewart schools’ administrative

program could be cut, such as support staff and adminis-

trator salaries. And, of course, if the Fort Stewart schools

lack financial ability to pay a 13.5% teacher salary in-

crease within the Army’s budget authority without ad-

versely impacting its educational program, it should re-

fuse to agree to the proposal and make its arguments to

the Federal Service Impasses Panel pursuant to 5 U.S.C.

7119 (b). Budget and financial constraints of a public

sector employer are precisely the kinds of factors con-

sidered in interest arbitration and impasse resolution.

F. ELKOURI & E. ELKourRI, How ARBITRATION WORKS,

832-835 (4th ed. 1985).

e. Whether the Army has a compelling need for Army

Reg. 352-3, 1-7, so as to preclude negotiations over pro-

posals that conflict with the regulation’s terms, certainly

19

is not a question warranting review by this Court. This

issue only impacts the 736 teachers who bargain at five

Army bases.

Proposals that conflict with an agency regulation are

negotiable unless the agency demonstrates a “compelling

need” for adherence to the regulation. 5 U.S.C. § 7117

(a) (2). In order to demonstrate a “compelling need” the

Army must demonstrate that either:

The rule or regulation is essential, as distinguished

from helpful or desirable, to the accomplishment of

the mission or execution of functions of the agency

[or] the rule or regulation implements a mandate

to the agency . . . under law . . . which implementa-

tion is essentially nondiscretionary in nature.

5 C. F. R. § 2424.11(a), (e).

Although § 241 (a) requires education at the Fort

Stewart schools to be comparable to that in local publie

schools, it does not require that salaries paid to teachers

be the same. The Army has not even demonstrated that

this regulation is helpful, no less essential, to ensuring

that the education provided to students on base is com-

parable to education off base. “Comparability” of edu-

cation is intangible. It cannot be measured simply by

comparing teachers’ salaries or even per-pupil teacher

expenditures. There is no proof that modest salary in-

creases will do anything but improve education at Fort

Stewart by improving morale and the retention rate of

experienced teachers. Congress enacted Section 6 out of

concern for the welfare of military dependents, not local

school districts.‘ While the Army must provide an edu-

‘The Section 6 schools were originally created because the

public schools in neighboring communities were racially segregated.

Hearings pursuant to H. Res. 115 before the Special Subcomm. of

the House Comm. on Education and Labor, 83rd Cong., Ist Sess.,

127-130 (1953) (statement of Rall Grigsby, Acting Commissioner

of Education). Authority to operate schools on military bases

cation that is comparable, nothing prohibits it from pro-

viding a better education than the local school districts

do. Any other reading of § 241 would be absurd because

no purpose would be served by it. Would the Army be in

violation of § 241 if the students at Fort Stewart got

higher standardized test scores, got into better colleges,

read better, wrote better and spelled better than students

in local public schools?

Nor has the Army demonstrated how its regulation is

essential to carrying out § 241(e). That subsection only

requires equal per-pupil costs “to the maximum extent

practicable.” Assuming that it is not practicable to offset

the increased cost of teachers’ salaries by other economies

in the schools’ overall program (and certainly economies

can be found in any government program), the Army

may exceed per-pupil costs without offending § 241(e)

because it is not “practicable” to equalize them and meet

the bargaining obligations imposed upon the Army by

the FSLMR Statute at the same time. Both Section 6

and the FSLMR Statute are acts of Congress advancing

important social welfare goals, and both are equally im-

portant. The Army’s obligations under one law must be

balanced with its obligations under the other. Under

the FSLMR Statute the Army must bargain over con-

di.ions of employment, but under § 241(e) the Army

must equalize per- pupil expenditures only if it is “prac-

ticable” to do so.

Even assuming that the Army has no discretion to

exceed equal per-pupil costs, the Army has not even dis-

closed how the per-pupil expenditures at Fort Stewart

presently compares with such expenditures at Georgia pub-

lie schools. Nor has the Army demonstrated that teach-

within the United States was expanded by the Civil Rights Act of

1960, Pub. L. No. 86-449, Title V. § 501, 74 Stat. 909 (1960) be-

cause local school authorities near military bases had closed public

schools in an attempt to defy desegregation orders. 1960 US.

Cope Conc. & Ap. News 1946, 1950.

sal-

ary increase than that sought herein.” Assumi

salaries at Fort Stewart and the Georgia —

are presently comparable, other significant portions of the

teachers total compensation package are already unequal.

Teachers at Fort Stewart who were employed prior to De-

cember 31, 1983, are covered by the Federal Civil Service

Retirement System, 5 U.S.C. § 8301 et seg. The Army

— covered by different

programs (compare 5 U.S.C. § 9801 et seg. with

Ga. Cob ANN. § 20-2-880 et seg.) as well as different

life insurance and disability programs. The claim that

compensation costs are and must remain equal is a myth.

The proposal for an annual 13.5% raise is not the only one

at issue. Other proposals would require the Army to use certain

specified procedures in surveying the salaries paid to teachers in

local school districts, would require that the number of pay steps

corresponding to the number of years of experience be increased

1 er The Army has

—.— proposals conflict with pay practices in

a ——

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted,

APPENDIX

la

APPENDIX

INVENTORY OF FEDERAL PAY SYSTEMS

STATUTORY PAY SCHEDULES -

General Schedule (Title 5, United States

Code, chapter 51 and subchapter III of

V 11,412,169

Foreign Service (Title 22, USC, chapters 14

r 13,950

Career Ambassadors, Career Ministers,

and Chiefs of Missions 123

Foreign Service Officers 3,278

Foreign Service Reserve .......... 5,816

Foreign Service Staff ............. 3,806

Foreign Service Information

133 927

Department of Medicine and Surgery, Vet-

erans Administration (Title 38, USC, chap-

EE EE 26,658

Physicians and Dentists .......... 4,920

EE 21,738

Administrative Personnel (*?)

Executive Schedule (5 USC, subchapter II of

SSO 3378

Commissioned Personnel, Public Health Ser-

vice and National Oceanic and Atmospheric

Administration (Title 37, US) 5,485

Executive Protective Service (3 USC 204) 850

United States Park Police (Title 4, District

of Columbia Code, 833) 514

Police, National Zoological Park (5 USC

e eueseneusseesecs 530

ADMINISTRATIVE DETERMINED

SALARY SCHEDULES

United States Postal Service (Title 39, USC).. 718,502

Postal Serviee 577,589

See footnote at end of table.

2a

Postal Management all 47,846

Postal Executive ...................... 29,502

Fourth-Class Postmasters ........ 5,332

Postal Service Temporary

Es 107

Postal Service Officer 88

Similar to the General Schedule

Energy Research and Development Ad-

ministration (Atomic Energy Act of

1954, Sec. 161d; and Energy Reorgani-

zation Act of 1974) ...........................-...-

Nuclear Regulatory Commission

(Atomic Energy Act of 1954, Sec.

161d; and Energy Reorganization Act

Sf ES ae

National Security Agency (Pub. L. 86-

. —

Central Intelligence Agency (50 USC

G ——

Panama Canal Zone (Title 2, Canal Zone

Code, 148 and 14kök᷑ti

Federal Deposit Insurance Corp. (12

1K mwꝛ - Ta

Federal Reserve System (Federal Re-

serve Act of 1913, as amended)............

National Science Foundation (42 USC

D BORER ee NE eon

Youth Employment Programs (Schedule

A, Sec. 213.3102 (v) and (w)) ~.........

Tennessee Valley Authority, Salary Policy

Employees (Tennessee Valley Authority,

Act of 1933, as amended) ............................

EE a Ra 2,255

Engineering and Scientific... 2,281

Aide and Technician 2,070

D 1.871

Administrative .......................... 519

. 286

r 241

See footnote at end of table.

7,105

11,016

9

(?)

2,893

$2,292

*1,046

292

20, 789

9,523

Noncitizens in nonwage positions (Various

authorities, including treaties and other

⁊ Ae eS ee sa

Census temporary positions (13 USC 23 and

. —— aa ee a

Experts and Consultants (5 USC 3109)

Teachers, Department of Defense ess

Overseas dependents schools

(20 USC ch. 265) .................... 7,357

Domestic dependents schools

(20 USC 241( a)) 1,750

United States Attorneys and Assistant U.S.

Attorneys (28 USC 54)

Special Attorneys, Department of Justice (28

EE ] ....

Scientific and Professional (5 USC 3104 and

r ̃ ...

Faculty at Service Academies

Naval Academy, Naval War

College and Naval Postgrad-

uate School (10 USC 7478,

7044, 7043, 6952) 570

Merchant Marine Academy (46

D 90

Coast Guard Academy (14

r 41

Civilian members of faculty and staff, Uni-

formed Services University of the Health

Sciences, Department of Defense (10 USC

RTE a ly Bel a RE

Canteen Service, Veterans Administration

e

Foreign Compensation (Pub. L. 87-195, Sec.

CSG A he Ne

Foreign Defense (Pub. L. 87-195, Sec.

r

Panama Canal Zone Special Category (2

Canal Zone Code 143 and 149)

Agricultural Marketing (7 USC 1627)

See footnote at end of table.

2 1,550

(*)

618

*701

(?)

2,174

178

15

1,317

845

4a

Alaska Railroad (43 USC 979)

National Bank Examiners, Department of

Treasury (12 USC, ch. 1, and 5 USC 5102

„ ö

Board of Patent Appeals (35 USC 3 and 7)

Foreign Service Institute (22 USC 1044)

United Nations Participation (State Dept.)

1 ̃ öln—

Student Medical Interns (5 USC 5352 and

1 K aibscncastbinctinciiiadinsahindembinnmese

Administrative Schedule, Agency for Inter-

national Development (Pub. L. 87-195, Sec.

r —

Consular Agents (22 USC 861 (6), 873, and

RE en a

Staff, Offices of Former Presidents (Pub. L.

F

Smithsonian Institution (20 USC 740 e))

III. ADMINISTRATIVELY DETERMINED

WAGE SCHEDULES

Federal Wage System (5 USC, subchapter IV

e

Regular Schedule 438,886

Nonsupervisory ............... (383,036)

1 (14,371)

r (41,479)

Production Facilitating -........ 7,554

Printing and Lithographie 4,887

Other Special Schedules _...... 25,210

Tennessee Valley Authority, trades and labor

employees (Tennessee Valley Authority Act

of 1988, as amended) ....................................

Panama Canal Zone, wage employees (2 Canal

Zone Code 143 and 144) 0.0.00...

Vessel Employees (5 USC 534)

Bonneville Power Administration (Bonneville

Project Act, as amended) ............................

See footnote at end of table.

470,558

14,842

1,101

4,878

51,100

da

Alaska Railroad, Operating Personnel (43

een 5905

Bureau of Engraving and Printing (5 USC

r 622

— Keepers (14 USC 482(f) and

7 ˙TÄ . (?)

Noncitizen wage employees (*)

Extract of the Civil Service Commission’s Central Personnel

Data file as of April 30, 1975, unless otherwise specified.

2 Data not available.

This inventory lists numbers of positions actually occupied and

reported. The Executive Schedule covers nearly 700 specific statu-

tory positions, not all of which are occupied, or reported as occu-

pied, at any one time.

* President’s Budget for fiscal year 1976.

5 Estimates for fiscal year 1976.

Extract of Civil Service Commission’s annual survey, “Salary

and Wage Distribution of Federal Civilian Employees,” as of

March 31, 1974.