Customs Service and National Treasury Employees Union, 0-AR-3636, February 27, 2004, 59 FLRA No. 128.

An agency has no obligation to bargain over a ground rule exceeding the scope of impact and implementation bargaining. "[I]f unions could condition impact and implementation bargaining on the negotiation of unrelated matters, the increased bargaining power available would exceed the latitude given unions by Congress in that scheme. The resultant delay would serve no useful purpose in accomplishing the statutory goal of an effective and efficient Government."

In 1995 a joint labor-management committee agreed to a National Inspectional Assignment Policy (NIAP) dealing with policies governing the assignment of inspectors to tours of duty and overtime work. The national agreement (NLA) between the agency and the union, which expired in 1999, contained a provision stating, "[i]n the interest of partnership, the Employer agrees to bargain with the Union over [§ 7106(b)(1) matters]." On July 18, 2001, following the issuance of Executive Order 13203 -- which rescinded Executive Order 12871 and its directive to bargain on § 7106(b)(1) matters -- the agency advised the union it would no longer bargain over permissive subjects as required by the expired agreement and no longer be bound by provisions of agreements dealing with permissive subjects.

It also transmitted to the union a draft of a revised NIAP which contained, among other things, criteria governing employee work assignments under § 7106(a)(2)(B) and staffing patterns under § 7106(b)(1). The parties were unable to reach agreement on I&I ground rules, mainly because the union's proposed ground rule didn't limit itself to the change in conditions of employment proposed by the agency but made negotiations over several provisions in the expired NLA a condition for bargaining on the impact and implementation of the proposed change. On September 6, 2001, the agency said that delaying implementation of the revised NIAP was unacceptable and that it wouldn't put off implementation until the parties completed negotiation of the NLA. On September 21 the union requested assistance from the Impasses Panel, claiming the parties were at an impasse over the union's proposal to simultaneously negotiate on the revised NIAP and the NLA. On October 1 the agency implemented the revised NIAP. The union filed a grievance and the matter was referred to arbitration and the arbitrator found that the agency violated the statute when it implemented the proposed NIAP without completing negotiations.

The agency filed exceptions claiming, among other things, that the award was contrary to law. FLRA agreed, for the following reasons.

[T]he agency did not violate the Statute in implementing the revised NIAP. The implementation of the revised NIAP constituted the Agency's exercise of its rights under § 7106(a) and § 7106(b)(1) of the Statute. As such, the Agency was not obliged to bargain over its decision. Rather, the Agency was obligated to bargain only over procedures which the Agency would observe in implementing the revised NIAP (§ 7106(b)(2) of the Statute) and appropriate arrangements for employees adversely affected by the Agency's decision to implement the revised NIAP (§ 7106(b)(3) of the Statute). Stated otherwise, the Union's right to bargain in this case was limited to the impact and implementation of the proposed changes in the NIAP.

The Union's ground rule proposal conditioned negotiations over the impact and implementation of the revised NIAP on first bargaining over the expired master collective bargaining agreement. This proposal was not a matter falling within § 7106(b)(2) or § 7106(b)(3) of the Statute with respect to the implementation of the revised NIAP. As such, the proposal constituted a permissive subject of bargaining as to which the Agency could have elected, but was not obligated, to bargain. The Agency's implementation of the revised NIAP, in the face of a proposal over which it was not obligated to bargain, was, therefore, not a violation of the Statute. Because the Arbitrator erred as a matter of law in finding that the Agency improperly implemented the revised NIAP, his award must be set aside.

In reaching its conclusion, FLRA emphasized that the I&I bargaining obligation "is limited to only those procedures, under § 7106(b)(2), and appropriate arrangements, under § 7106(b)(3), that address the change proposed." And although the duty to bargain extends to ground rules for negotiations, those ground rules "must be consistent with the parties' obligation to bargain in a particular case."

Further, because the Union's proposed ground rule constitutes a permissive matter, the Agency had a right not only to refuse to bargain to impasse over the matter, but also to implement the revised NIAP without completing bargaining. See, e.g., United States Dep't of Justice, Fed. Bu. of Prisons, FCI Danbury, Danbuy, Conn, 55 FLRA 201, 206 (1999) ("A party's right to terminate unilaterally a permissive bargaining subject is not contingent on first satisfying a bargaining obligation as to the substance, impact or implementation of the change.")