During collective bargaining, petitioner schools, which are
owned and operated by the Army at a military facility, declined to
negotiate with respondent Union over proposals relating to a salary
increase and fringe benefits. Respondent Federal Labor Relations
Authority held that the Federal Service Labor-Management Relations
Statute (FSLMRS or the Statute) required petitioner to bargain over
the proposals. The Court of Appeals affirmed.
Held: The Authority did not err in ruling that
petitioner was required to bargain over the Union's proposals. Pp.
495 U. S.
644-657.
(a) The Authority's conclusion that the Union's proposals
related to "conditions of employment" within the meaning of the
Statute, over which covered employers are required to bargain, is
based upon a permissible construction and is entitled to deference
absent an unambiguous expression of congressional intent to the
contrary.
Cf. 467 U. S. S.A.
Inc. v. Natural Resources Defense Council, Inc., 467 U.
S. 837,
467 U. S.
842-843. The Statute defines "conditions of employment"
as matters "affecting working conditions," but excludes matters (1)
relating to prohibited partisan political activities; (2) relating
to the classification of positions; or (3) specifically provided
for by federal statute. Although, in isolation, the term "working
conditions" might be read to connote only the physical conditions
under which an employee labors, the structure of the statutory
definition tends to negate that meaning, which would render the
first two exceptions unnecessary. There is no merit to petitioner's
contention that, although the term "conditions of employment" may
generally include any matter insisted upon as a prerequisite to
accepting employment, it does not include wages. Wages are the
quintessential prerequisite to accepting employment. Nor is the
inclusion in the National Labor Relations Act and the Postal
Reorganization Act of specific references to "wages" relevant here;
those statutes deal with labor-management relations in entirely
different spheres, and nothing in the FSLMRS indicates that it is
to be read
in pari materia with them. Statements in the
legislative history suggesting that the FSLMRS duty to bargain does
not extend to wage and fringe benefit proposals are also
irrelevant, in light of indications that these statements were
based on
Page 495 U. S. 642
the erroneous belief that the wages and benefits of all
Executive Branch employees are fixed by law and are therefore
eliminated from the "conditions of employment" definition by the
third statutory exception. Pp.
495 U. S.
644-650.
(b) The Union's proposals are not exempted from the statutory
duty to bargain by an FSLMRS provision specifying that "nothing in
this chapter shall affect the authority of any [agency] management
official . . . to determine the [agency's] budget." Under the
Authority's precedents interpreting this provision, petitioner had
the burden of proving that the Union's proposals would result in
significant and unavoidable increases in petitioner's costs. Since
petitioner placed nothing in the record to document its total costs
or even its current total teachers' salaries, the Authority
reasonably determined that it could not conclude from an increase
in one budget item of indeterminate amount whether petitioner's
costs as a whole would be significantly and unavoidably increased.
Pp.
495 U. S.
650-653.
(c) Title 20 U.S.C. § 241 -- which directs agencies establishing
schools on federally owned property to limit expenditures to "an
amount per pupil which will not exceed the per pupil cost of free
public education provided [by] comparable communities in the State"
-- and an implementing Army regulation -- which requires that
federal school salary schedules equal those in the private sector
-- do not relieve petitioner of its duty to bargain on the ground
that the Union's proposed salary increase would require petitioner
to pay its teachers more than employees in local civilian school
systems. In rejecting this argument, the Authority relied on an
FSLMRS provision requiring, "to the extent not inconsistent with
Federal law," bargaining over the subject of an agency regulation
"if the Authority has determined . . . that no compelling need . .
. exists for the . . . regulation," and on its own implementing
regulation declaring that a "compelling need" exists if, among
other things, the agency regulation in question implements a
statutory mandate that is "essentially nondiscretionary in nature."
It cannot be said that the salary equality requirement is
"essentially nondiscretionary in nature," since § 241 mandates
equivalence only in total per pupil expenditure, not in each
separate element of educational cost. Pp.
495 U. S.
653-657.
860 F.2d 396 (CA 11, 1988), affirmed.
SCALIA, J., delivered the opinion for a unanimous Court.
MARSHALL, J., filed a concurring opinion,
post, at p.
495 U. S.
657.
Page 495 U. S. 643
Justice SCALIA delivered the opinion of the Court.
In this case, we review the decision of the Federal Labor
Relations Authority that petitioner Fort Stewart Schools, a Federal
Government employer, is required to bargain with the labor union
representing its employees over a proposal relating to wages and
fringe benefits.
I
Respondent Fort Stewart Association of Educators (the Union), is
the collective bargaining representative of the employees of two
elementary schools at Fort Stewart, a United States military
facility in Georgia. The schools, petitioner here, are owned and
operated by the United States Army under authority of 64 Stat.
1107, 20 U.S.C. § 241(a), which directs the Secretary of Health and
Human Services to "make such arrangements . . . as may be necessary
to provide free public education" for children living on federally
owned property. The present controversy arose when, during the
course of collective bargaining negotiations, the Union submitted
to the schools proposals relating to mileage reimbursement, various
types of paid leave, and a salary increase. Petitioner declined to
negotiate these matters, claiming that they were not subject to
bargaining under Title VII of the Civil Service Reform Act of 1978,
sometimes referred
Page 495 U. S. 644
to as the Federal Service Labor-Management Relations Statute, 5
U.S.C. § 7101
et seq. (FSLMRS or the Statute). The Union
sought the aid of the Federal Labor Relations Authority pursuant to
§§ 7105(a)(2)(D) and (E), and the Authority held that the Union's
proposals were negotiable.
Fort Stewart Assn. of
Educators, 28 F.L.R.A. 547 (1987). Upon a petition for review
by petitioner and cross-petitions for enforcement by the Authority
and the Union, the Court of Appeals for the Eleventh Circuit upheld
the Authority's decision, 860 F.2d 396 (1988), and we granted
certiorari, 493 U.S. 807 (1989).
II
The FSLMRS requires a federal agency to negotiate in good faith
with the chosen representative of employees covered by the Statute,
5 U.S.C. § 7114(a)(4), and makes it an unfair labor practice to
refuse to do so, § 7116(a)(5). The scope of the negotiating
obligation is set forth in § 7102, which confers upon covered
employees the right, through their chosen representative, "to
engage in collective bargaining with respect to conditions of
employment." 5 U.S.C. § 7102(2). Section 7103 defines "conditions
of employment" as follows:
"'conditions of employment' means personnel policies, practices,
and matters, whether established by rule, regulation, or otherwise,
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 position; or"
"(C) to the extent such matters are specifically provided for by
Federal statute. . . ."
5 U.S.C. § 7103(a)(14).
In construing these provisions, and the other provisions of the
FSLMRS at issue in this case, the Authority was interpreting the
statute that it is charged with implementing,
see
Page 495 U. S. 645
§ 7105. We must therefore review its conclusions under the
standard set forth in
Chevron U.S.A. Inc. v.
Natural Resources Defense Council, Inc.,
467 U. S. 837
(1984). If, upon examination of "the particular statutory language
at issue, as well as the language and design of the statute as a
whole,"
K Mart Corp. v. Cartier, Inc., 486 U.
S. 281,
486 U. S. 291
(1988), it is clear that Authority's interpretation is incorrect,
then we need look no further, "for the court, as well as the
agency, must give effect to the unambiguously expressed intent of
Congress."
Chevron, 467 U.S. at
467 U. S.
842-843. If, on the other hand, "the statute is silent
or ambiguous" on the point at issue, we must decide "whether the
agency's answer is based on a permissible construction of the
statute."
Ibid.
The Authority concluded that the Union's proposals related to
"conditions of employment," following its decision in
American
Federation of Government Employees, AFL-CIO, Local 1897, 24
F.L.R.A. 377, 379 (1986) (
AFGE). 28 F.L.R.A., at 550-551.
Petitioner claims that this was error because § 7103(a)(14) defines
"conditions of employment" as matters affecting "working
conditions," and because the latter term most naturally connotes
"the physical conditions under which an employee labors," Brief for
Petitioner 17. The difficulty here, of course, is that the word
"conditions" has two common meanings. It can mean matters
"established or agreed upon as a requisite to the doing . . . of
something else"; and it can also mean "[a]ttendant circumstances,"
or an "existing state of affairs." Webster's Second New
International Dictionary 556 (1957). Whereas the term "conditions
of employment" in § 7102 seems to us equally susceptible of both
meanings, petitioner is correct that the term "working conditions"
in the defining provision of § 7103(a)(14) more naturally refers,
in isolation, only to the "circumstances" or "state of affairs"
attendant to one's performance of a job.
See Department of
Defense Dependents Schools v. FLRA, 274 U.S.App.D.C. 299, 301,
863 F.2d 988, 990 (1988) ("[The term
working conditions'
ordinarily calls to
Page 495 U. S.
646
mind the day-today circumstances under which an employee
performs his or her job"), rehearing en banc granted, No.
87-1733 (Feb. 6, 1989). Even if, however, it could not reasonably
be interpreted to bear the other meaning in isolation, here it is
not in isolation, but forms part of a paragraph whose structure, as
a whole, lends support to the Authority's broader reading.
As set forth above, § 7103(a)(14) specifically excepts from the
definition of "conditions of employment" (and thus suggests are
covered by the term "working conditions") "policies, practices, and
matters . . . relating to political activities prohibited under
subchapter III of chapter 73 of this title." The subchapter
referred to contains restrictions on partisan political activities
of federal employees, and protects them from being required or
coerced to engage in political activity. It is barely conceivable,
but most unlikely, that this provision of § 7103(a)(14) was meant
to exclude from collective bargaining proposals that would somehow
infect with politics the "physical conditions" of the workplace; it
seems much more plausibly directed at "conditions of employment" in
the sense of qualifications demanded of, or obligations imposed
upon, employees. And the second exception set forth in §
7103(a)(14), as set forth above, unquestionably assumes that
"conditions of employment" (and hence "working conditions") bears
this broader meaning. The exception of "policies, practices, and
matters . . . relating to the classification of any position,"
would be utterly unnecessary if petitioner's interpretation of
"working conditions" were correct.
It might reasonably be argued, of course, that these two
exceptions are indeed technically unnecessary, and were inserted
out of an abundance of caution -- a drafting imprecision venerable
enough to have left its mark on legal Latin (
ex abundanti
cautela). But petitioner does not make this argument. Indeed,
in its reply brief, petitioner claims that it is "a serious
distortion of [its] position," Reply Brief for Petitioner 2, to
characterize it, as respondent does, as asserting
Page 495 U. S. 647
that "negotiations over
working conditions' are limited to
the physical conditions under which an employee labors." Brief for
Respondent 11. Petitioner asserts that, to the contrary, it
"recognize[s] that the phrase `conditions of employment' is no
doubt susceptible of diverse interpretations," including an
interpretation whereby it would embrace "any subject which is
insisted upon as a prerequisite for continued employment," Reply
Brief 2 (internal quotations omitted); and petitioner even
acknowledges, with apparent approval, that the phrase in the
present statute "has been extended beyond the purely physical
conditions of the workplace," ibid. The textual argument
is thus abandoned. Petitioner seeks to persuade us, not (as
respondent does) that the term "conditions of employment" (as
defined to include only "working conditions") bears one, rather
than the other, of its two possible meanings; but rather to
persuade us that it bears some third meaning no one has ever
conceived of, so that it includes other insisted-upon
prerequisites for continued employment, but does not include the
insisted-upon prerequisite par excellence, wages. And this
new unheard-of meaning, petitioner contends, is so "unambiguously
expressed," Chevron, supra, 467 U.S. at 467 U. S. 843,
that we must impose it upon the agency initially responsible for
interpreting the statute, despite the deference otherwise accorded
under Chevron. To describe this position is sufficient to
reject it, but we nonetheless examine briefly the elements
petitioner sets forth to establish that "conditions of employment"
clearly has a meaning here that it bears nowhere else.
Petitioner points to the National Labor Relations Act, 49 Stat.
449,
as amended, 29 U.S.C. § 151
et seq., which
authorizes bargaining over "wages, hours, and other terms and
conditions of employment," 29 U.S.C. § 158(d), and to the Postal
Reorganization Act, 39 U.S.C. § 1201
et seq., which grants
postal workers the right to bargain over "wages, hours, and working
conditions." Note following 39 U.S.C. § 1201. Because each of these
statutes specifically refers to wages, the argument
Page 495 U. S. 648
runs, we must infer from the absence of such a reference in the
FSLMRS that Congress did not mean to include them. But those other
statutes deal with labor-management relations in entirely different
fields of employment, and the FSLMRS contains no indication that it
is to be read
in pari materia with them. The first of
those provisions does (perhaps) show that the term "conditions of
employment" can be used to refer only to physical circumstances of
employment; and the second of them does (perhaps) show that
"working conditions" is more naturally used to mean that -- but
those are points we have already conceded.
Petitioner discusses at great length the legislative history of
the Statute, from which it has culled a formidable number of
statements suggesting that certain members and committees of
Congress did not think the duty to bargain would extend to
proposals relating to wages and fringe benefits. A Senate Report,
for example, states unequivocally that
"[t]he bill permits unions to bargain collectively on personnel
policies and practices, and other matters affecting working
conditions within the authority of agency managers. . . . It
excludes bargaining on economic matters. . . ."
S.Rep. No. 95-969, pp. 12-13 (1978), U.S.Code Cong. &
Admin.News 1978, pp. 2734, 2735. A House Report recounts that the
bill "does not permit . . . bargaining on wages and fringe
benefits. . . . " H.R.Rep. No. 95-1403, p. 12 (1978). To like
effect are numerous floor statements by both sponsors and
opponents. [
Footnote 1]
Page 495 U. S. 649
The trouble with these statements, to the extent they are
relevant to our inquiry, is that they may have been wrong. The
wages and fringe benefits of the overwhelming majority of Executive
Branch employees are fixed by law, in accordance with the General
Schedules of the Civil Service Act,
see 5 U.S.C. § 5332,
and are therefore eliminated from the definition of "conditions of
employment" by the third exception in § 7103(a)(14) set forth above
-- which excludes "matters . . . specifically provided for by
Federal statute." 5 U.S.C. § 7103(a)(14)(C). Employees of schools
established under § 241 are among a miniscule minority of federal
employees whose wages are exempted from operation of the General
Schedules. 20 U.S.C. § 241(a) provides that an agency establishing
such a school may fix "the compensation, tenure, leave, hours of
work, and other incidents of the employment relationship" of its
employees "without regard to the Civil Service Act and rules."
Ibid. See also AFGE, 24 F.L.R.A. at 378. The
legislative materials to which petitioner refers display no
awareness of this exception. To the contrary, numerous statements,
many from the same sources to which petitioner points, display the
erroneous belief that the wages and fringe benefits of
all
Executive Branch employees were set by statute.
See H.R.
Rep. No. 95-1403, p. 12 (1978) ("Federal pay will continue to be
set in accordance with the pay provisions of title 5, and fringe
benefits, including retirement, insurance, and leave, will continue
to be set by Congress");
id. at 44 ("Rates of overtime pay
are not bargainable, because they are specifically provided for by
statute"). [
Footnote 2] Thus,
all of the statements to which petitioner
Page 495 U. S. 650
refers may have rested upon the following syllogism: The wages
and fringe benefits of all federal employees are specifically
provided for by federal statute; "conditions of employment" subject
to the duty to bargain do not include "matters . . . specifically
provided for by Federal statute"; therefore "conditions of
employment" subject to the duty to bargain do not include the wages
and fringe benefits of all federal employees. Since the premise of
that syllogism is wrong, so may be its expressed conclusion. There
is no conceivable persuasive effect in legislative history that may
reflect nothing more than the speakers' incomplete understanding of
the world upon which the statute will operate.
Cf. Yellow
Freight System, Inc. v. Donnelly, 494 U.
S. 820,
494 U. S. 824
(1990) (expectation by members of Congress that all Title VII suits
would be tried in federal court, "even if universally shared," does
not establish that the statute requires such suits to be brought in
federal court).
III
Petitioner next argues that, even if the Union's proposals
relate to "conditions of employment" subject to bargaining under §
7102, they are exempted from the statutory duty to bargain by §
7106, which provides that "nothing in this chapter shall affect the
authority of any management official of any agency . . . to
determine the . . . budget . . . of the agency . . . ." 5 U.S.C. §
7106. The Authority rejected that claim by applying the test
established in its decision in
American Federation of
Government Employees, AFL-CIO, 2 F.L.R.A. 604 (1980),
enf'd on other grounds sub nom.
Page 495 U. S.
651
Department of Defense v. FLRA, 212 U.S.App.D.C. 256,
659 F.2d 1140 (1981),
cert. denied, 455 U.S. 945
(1982):
"To establish that a proposal directly interferes with an
agency's right to determine its budget under section 7106(a)(1) of
the Statute, an agency must make a substantial showing that the
proposal requires the inclusion of a particular program or amount
in its budget
or that the proposal will result in significant
and unavoidable increases in cost not affected [sic: offset] by
compensating benefits."
28 F.L.R.A. at 551 (emphasis added). Because petitioner did not
contend that the Union's proposal required "the inclusion of a
particular program or amount in its budget," the only question for
the Authority was whether petitioner had made out its case under
the underscored standard. The Authority held that it had not,
finding that petitioner had shown neither that its costs would be
significantly and unavoidably increased were it to accept the
proposals offered by the Union nor that "any increased costs . . .
would not be offset by compensating benefits."
Id. at
552.
The parties initially dispute which entity is the relevant
"agency" for purposes of determining whether the Union's proposals
would "affect the authority of any management official of any
agency . . . to determine the . . . budget . . . of the agency. . .
." 5 U.S.C. § 7106(a). The Authority concluded only that petitioner
had not satisfied § 7106(a) with respect to its own budget,
i.e., that of the schools at the Fort Stewart Army base.
The Court of Appeals upheld the Authority's decision, but did so by
reference to the budget of the Army as a whole, which it noted
"includes bases, troops, weapons, vehicles, other equipment,
salaries for all other officers, and expenses for its eight other
schools." 860 F.2d at 405-406. We cannot, however, uphold the
Authority's decision on that basis, for it is elementary that if an
agency's decision is to be sustained in the courts on any rationale
under which the agency's factual or legal determinations are
Page 495 U. S. 652
entitled to deference, it must be upheld on the rationale set
forth by agency itself.
SEC v. Chenery Corp., 318 U. S.
80,
318 U. S. 93-95
(1943). Because petitioner does not challenge, as a ground for
reversing the Authority's decision, its determination to look only
to petitioner's budget, we assume without deciding that that
determination was correct.
Petitioner does not take issue with the Authority's premise that
§ 7106 does not make a proposal nonnegotiable simply because it
"imposes a cost upon the agency which requires the expenditure of
appropriated agency funds."
See 2 F.L.R.A. at 607. Rather,
petitioner argues that
"the application of the FLRA's rule here -- particularly the
conclusion that the proposal calling for a 13.5% pay raise would
not significantly affect the agency's budget -- is plainly
flawed."
Brief for Petitioner 28. Petitioner also claims that
"the other aspect of the FLRA's rule -- requiring management to
show that a significant increase in costs would not be offset by
compensating benefits -- is not reasonable or consistent with the
statute, because it negates management's right to set the agency
budget."
Ibid.
The latter observation has some force, if the Authority's
definition of "compensating benefits" is as petitioner describes
it. Petitioner claims that, in order to prove that the cost of a
given proposal is not outweighed by "compensating benefits," an
agency must disprove not only monetary benefits, but also
nonmonetary "intangible" benefits such as the positive effects that
a proposed change might have on employee morale. Although counsel
for the Authority agreed with petitioner's statement of its test at
oral argument before this Court, it is not entirely clear from the
Authority's cases that the "benefits" side of the calculus is as
all-embracing as petitioner suggests.
Cf. International
Association of Fire Fighters Local F-61, 3 F.L.R.A. 438, 452
(1980) (rejecting agency's claim of no "compensating benefits"
where "the agency has made no substantial demonstration that the
increased costs . . . will not be offset by increased employee
Page 495 U. S. 653
performance, reduced turnover, fewer grievances and the like").
Indeed, it is difficult to see how the Authority could possibly
derive a test measured by nonmonetary benefits from a provision
that speaks only to the agency's "authority . . . to determine . .
. [its] budget," a phrase that can only be understood to refer to
the allocation of funds within the agency.
We need not dwell on this point, however, because the
Authority's first ground for its decision is supported by
substantial evidence. Petitioner has challenged neither the
Authority's requirement that an agency show a significant and
unavoidable increase in its costs, nor the Authority's finding that
petitioner failed to submit any evidence on that point in this
case. Rather, it asks us to hold that a proposal calling for a
13.5% salary increase would necessarily result in a "significant
and unavoidable" increase in the agency's overall costs. We cannot
do that without knowing even so rudimentary a fact as the
percentage of the agency's budget attributable to teachers'
salaries. Under the Authority's precedents, petitioner had the
burden of proof on this point, but it placed nothing in the record
to document its total costs or even its current total teachers'
salaries. The Authority reasonably determined that it could not
conclude from an increase in one budget item of indeterminate
amount whether petitioner's costs as a whole would be
"significant[ly] and unavoidabl[y]" increased. [
Footnote 3]
IV
Petitioner's final argument rests upon 20 U.S.C. § 241, which
directs the agency establishing a school thereunder to
"ensure that the education provided pursuant to such arrangement
is comparable to free public education provided
Page 495 U. S. 654
for children in comparable communities in the State,"
20 U.S.C. § 241(a), and to limit expenditures "[t]o the maximum
extent practicable" to
"an amount per pupil which will not exceed the per pupil cost of
free public education provided for children in comparable
communities in the State."
20 U.S.C. § 241(e). In implementing this provision, the Army has
promulgated a regulation stating that education provided under §
241 "will be considered comparable to free public education offered
by selected communities of the State" when 10 specified factors,
including "[s]alary schedules" are, "to the maximum extent
practicable, equal." Army Reg. 352-3, 1-7(h) (1980). Petitioner
claims -- and we assume for purposes of this discussion -- that in
order to accept the Union's proposals, it would have to contravene
this regulation because the proposed salaries would exceed those of
employees of the local school systems.
It is a familiar rule of administrative law that an agency must
abide by its own regulations.
Vitarelli v. Seaton,
359 U. S. 535,
359 U. S. 547
(1959);
Service v. Dulles, 354 U.
S. 363,
354 U. S. 388
(1957). That says nothing, however, about whether an agency can be
compelled to negotiate about a change in its regulations. The
latter question is addressed by 5 U.S.C. § 7117(a), which provides,
insofar as applicable to the regulation here, that
"[t]he duty to bargain in good faith shall, to the extent not
inconsistent with Federal law or any Government-wide rule or
regulation, extend to matters which are the subject of any agency
rule or regulation . . .
only if the Authority has determined
under subsection (b) of this section that no compelling need (as
determined under regulations prescribed by the Authority) exists
for the rule or regulation."
5 U.S.C. § 7117(a)(2) (emphasis added). Section 7117(b) sets out
the procedures by which the Authority is to make its "compelling
need" determination,
see generally FLRA v. Aberdeen Proving
Ground, Department of Army, 485 U. S. 409
(1988), and § 7105 instructs the Authority to "prescribe criteria"
for that determination.
Page 495 U. S. 655
Pursuant to this last provision, the Authority has adopted the
following regulation:
"A compelling need exists for an agency rule or regulation
concerning any condition of employment when the agency demonstrates
that the rule or regulation meets any one or more of the following
illustrative criteria:"
"(a) The rule or regulation is essential, as distinguished from
helpful or desirable, to the accomplishment of the mission or the
execution of functions of the agency . . . in a manner which is
consistent with the requirements of an effective and efficient
government."
"(b) The rule or regulation is necessary to insure the
maintenance of basic merit principles."
"(c) The rule or regulation implements a mandate to the agency .
. . under law or other outside authority, which implementation is
essentially nondiscretionary in nature."
5 CFR § 2424.11 (1989).
Before the Authority, petitioner rested its entire case upon the
assertion that the last of these criteria was satisfied by the
provision of Army Regulation 352-3 which requires salaries equal to
those of local schools, since that provision "implements the
mandate" of § 241(a). The Authority disagreed, following its
decision in
Fort Knox Teachers Assn., 27 F.L.R.A. 203,
215, 216 (1987), which said that no "compelling need" for Army
Regulation 352-3 exists because § 241 does not require the agency
"to match exactly the conditions of employment of teachers in local
school districts" or "to restrict the Agency's discretion as to the
particular employment practices which could be adopted."
Petitioner argues that, although "[s]ection 241 does not
specifically provide that teachers' salaries . . . must be set by
comparison with those at local public schools," Brief for
Petitioner 32, it does state that "[f]or the purpose of providing
such comparable education," teachers' salaries and benefits "may be
fixed without regard to the [General Schedules set out in the]
Civil Service Act," 20 U.S.C. § 241(a). According
Page 495 U. S. 656
to petitioner,
"it is a fair reading of [§ 241] to conclude that Congress
excepted [wages and fringe benefits] from the civil service laws so
that they would be set by comparison with those at public
schools."
Brief for Petitioner 33. That is not so. All that can reasonably
be deduced from the exclusion of the General Schedules is that
Congress expected teachers' wages and benefits to be one of the
elements that the federal agency could adjust in order to render
per pupil expenditure comparable to that in local public schools.
But to be able to adjust is not to be required to make equal. The
statute requires equivalence ("[t]o the maximum extent
practicable") in total per pupil expenditure, not in each separate
element of educational cost. An agency may well decide to pay
teachers more or less than teachers in local schools, in order that
it may expend less or more than local schools for other needs of
the educational program. It is thus impossible to say that the
requirement of Army Reg. 352-3 (1980) that teachers' salaries be
"to the maximum extent practicable, equal" was "essentially
nondiscretionary in nature" within the meaning of § 2424.11(c).
Petitioner insists, however, that reading § 2424.11 this
strictly renders that regulation in violation of the Statute, which
never requires bargaining over any matter covered by a regulation
except "to the extent not inconsistent with Federal law."
See § 7117(a)(2);
see also § 7117(a)(1). Thus, to
recognize a compelling need for a regulation "only if it implements
a statutory mandate that leaves an agency absolutely no room for
discretion," Brief for Petitioner 33, n. 23, is to render the
"compelling need" exception of § 7117(a)(2) a nullity, for
bargaining over such a regulation would be "inconsistent with
Federal law" anyway. We may assume, without deciding, that
petitioner is correct that any rule that meets the § 2424.11(c)
"essentially nondiscretionary" standard as interpreted by the
Authority would necessarily be a rule required by law. There is
some support for that equivalency in the Authority's cases.
See, e.g., Fort Knox
Page 495 U. S.
657
Teachers Assn., 25 F.L.R.A. 1119 (1987).
But see
National Border Patrol Council, American Federation of Government
Employees, AFL-CIO, 23 F.L.R.A. 106 (1986);
National
Federation of Federal Employees, Local 1153, 26 F.L.R.A. 505
(1987). Even so, the Authority's regulation does not eliminate the
"compelling need" exception. Petitioner's argument ignores the
existence of subsections (a) and (b) of § 2424.11, which provide
alternative methods of proving "compelling need." In this case, to
be sure, petitioner chose not to assert a claim that Army
Regulation 352-3 was either "essential . . . to the accomplishment
of the mission or the execution of functions of the agency," 5 CFR
§ 2424.11(a) (1989), or "necessary to insure the maintenance of
basic merit principles," § 2424.11(b). But, those alternatives were
available, and suffice to give the regulation for which there is a
"compelling need" an existence quite independent of the regulation
whose elimination would be inconsistent with law.
For the foregoing reasons, the judgment of the Court of Appeals
for the Eleventh Circuit is
Affirmed.
[
Footnote 1]
See 124 Cong. Rec. 25716, 29182 (1978) (remarks of Rep.
Udall) ("We do not permit bargaining over pay and fringe benefits,
but on other issues relating to an employee's livelihood") ("There
is not really any argument in this bill or in this title about
Federal collective bargaining for wages and fringe benefits and
retirement");
id. at 24286, 25720 (remarks of Rep. Clay)
("employees still . . . cannot bargain over pay") ("I . . . want to
assure my colleagues that there is nothing in this bill which
allows Federal employees the right . . . to negotiate over pay and
money-related fringe benefits");
id. at 27549 (remarks of
Sen. Sasser) ("exclusive representatives of Federal employees may
not bargain over pay or fringe benefits").
[
Footnote 2]
Statements from the floor are to like effect.
See id.
at 25721, 25722 (remarks of Rep. Ford) ("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") ("It is not the intent of this provision to interfere
with the current system of providing the employees in question with
retirement benefits, life insurance benefits, health insurance
benefits, and workmen's compensation. Those benefits would not
become negotiable, and would continue to be paid to those employees
exclusively pursuant to the Federal statutes in effect.");
id. at 29182 (remarks of Sen. Udall) ("All these major
regulations about wages and hours and retirement and benefits will
continue to be established by law through congressional action");
id. at 29174 (remarks of Rep. Collins) (criticizing the
bill as too broad because it excluded from the scope of bargaining
only "matter[s] relating to discrimination, political activities,
and those few specifically prescribed by law -- for example, pay
and benefits").
[
Footnote 3]
Because petitioner loses under the standard set out in the
second part of the Authority's test, and because neither party
challenges that standard, we need not reach the question discussed
in Justice MARSHALL's opinion,
viz., whether the
Authority's interpretation of the phrase "to determine the . . .
budget" in § 7106 is too generous to the Government.
Justice MARSHALL, concurring.
I write separately to emphasize that management's prerogative to
"determine . . . the budget . . . of the agency," 5 U.S.C. §
7106(a)(1), is reasonably, and perhaps necessarily, subject to a
narrower reading than the one adopted by the Federal Labor
Relations Authority. The Authority presently interprets that
prerogative as exempting from the duty to bargain proposals that
either (1) require the inclusion of a particular program or
operation in the agency's budget or prescribe the amount to be
allocated to them in the budget, or (2) result in significant and
unavoidable increases in costs not offset by compensating benefits.
American Federation of Govt. Employees, AFL-CIO (AFGE), 2
F.L.R.A. 604, 608 (1980),
enf'd on other grounds sub nom.
Department of Defense v. FLRA, 212 U.S.App.D.C. 256, 659 F.2d
1140 (1981). Section 7106(a)(1) is more naturally read,
however,
Page 495 U. S. 658
as withdrawing from mandatory bargaining only those proposals
addressed to the budget
per se, not those that would
result in significantly increased expenditures by the agency.
As the Authority stated in formulating its test,
"'budget' means a statement of the financial position of a body
for a definite period of time based on detailed estimates of
planned or expected expenditures during the period and proposals
for financing them."
AFGE, supra, at 608 (citing Webster's Third New
International Dictionary (1966)). To "determine the budget," then,
means to calculate in advance the funds available to the agency and
the allocation of those funds among the agency's programs and
operations.
See AFGE, supra, at 608. The language of the
statute thus exempts from the duty to bargain only those proposals
that would involve the union in the budget process itself. This
interpretation also accords more closely with Congress' intent that
the management prerogatives in § 7106 be construed narrowly.
See, e.g., 124 Cong.Rec. 29183 (1978) (statement by Rep.
Udall, author of the language in § 7106) (§ 7106 is "to be treated
narrowly as an exception to the general obligation to bargain over
conditions of employment");
id. at 29187 (statement of
Rep. Clay) ("[I]t is essential that only those proposals that
directly and integrally go to the specified management rights be
barred from the negotiations"); H.R.Rep. No. 95-1403, 44 (1978)
("The committee intends that section 7106 . . . be read to favor
collective bargaining whenever there is doubt as to the
negotiability of a subject or a proposal").
The first part of the Authority's test accords with the plain
meaning of the budget provision. The second part, however, is at
best a stretch of the statutory language. Proposals that impose
"significant" and "unavoidable" costs on the agency do not
interfere with the agency's prerogative to determine which programs
and operations to include in its budget and how to allocate funds
among them. Such proposals may of course affect budgetary
decisions, but to remove
Page 495 U. S. 659
them from bargaining would eliminate bargaining over many
important matters altogether, without any indication that Congress
intended to do so.
The Union's proposals in this case would clearly not fall within
the agency's budget prerogative, because they do not require union
involvement in the budget process. Because the Union's proposals
are negotiable even under the Agency's "significant cost" test, we
need not decide whether that test is inconsistent with the statute.
The Court's opinion, however, does not foreclose a future challenge
to that test.