FORT STEWART SCHOOLS, PETITIONER V. FEDERAL LABOR RELATIONS
AUTHORITY AND FORT STEWART ASSOCIATION OF EDUCATORS
No. 89-65
In The Supreme Court Of The United States
October Term, 1989
On Writ Of Certiorari To The United States Court Of Appeals For The
Eleventh Circuit
Brief For The Petitioner
TABLE OF CONTENTS
Questions Presented
Opinions below
Jurisdiction
Statutory and regulatory provisions involved
Statement:
A. The statutory and regulatory framework
1. The federal labor relations statute
2. The domestic dependents schools statute and
regulation
B. Proceedings below
1. The FLRA's decision
2. The court of appeals' opinion
Summary of argument
Argument:
I. The federal labor relations statute does not
authorize federal employees to bargain collectively
over their wages and monetary fringe
benefits
II. The proposals interfere with the agency's right
to set its budget
III. The proposals are inconsistent with an Army
regulation for which there is a "compelling
need"
Conclusion
OPINIONS BELOW
The opinion of the court of appeals (Pet. App. 1a-30a) is reported
at 860 F.2d 396. The decision of the Federal Labor Relations
Authority (Pet. App. 31a-54a) is reported at 28 F.L.R.A. 547.
JURISDICTION
The judgment of the court of appeals (Pet. App. 19a-20a) was
entered on November 21, 1988. A timely petition for rehearing was
denied on February 17, 1989 (Pet. App. 55a-56a). On May 11, 1989,
Justice Kennedy extended the time within which to file a petition for
a writ of certiorari to and including July 17, 1989. The petition for
a writ of certiorari was filed on that date, and was granted on
October 2, 1989. The jurisdiction of this Court is invoked under 28
U.S.C. 1254(1).
STATUTORY AND REGULATORY PROVISIONS INVOLVED
A. Title VII of the Civil Service Reform Act, also known as The
Federal Service Labor-Management Relations Statute
Section 7102 (5 U.S.C.) provides in relevant part:
Each employee shall have the right * * *
* * * * *
(2) to engage in collective bargaining with respect to
conditions of employment through representatives chosen by
employees under this chapter.
Section 7103 (5 U.S.C.) provides in relevant part:
(a) For the purpose of this chapter --
* * * * *
(14) "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
* * * * *
(C) to the extent that such matters are specifically provided
for by Federal statute(.)
Section 7106(a)(1) (5 U.S.C.) provides:
(a) Subject to subsection (b) of this section, nothing in
this chapter shall affect the authority of any management
official of any agency --
(1) to determine the mission, budget, organization, number of
employees, and internal security practices of the agency * * *.
Section 7117 (5 U.S.C.) provides in relevant part:
(a)(1) Subject to paragraph (2) of this subsection, the duty
to bargain in good faith shall, to the extent not inconsistent
with any Federal law or any Government-wide rule or regulation,
extend to matters which are the subject of any rule or
regulation only if the rule or regulation is not a
Government-wide rule or regulation.
(2) The 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 referred to in paragraph (3) of this
subsection 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.
B. The dependents school statute and regulation
Section 241 (20 U.S.C.), originally enacted as Title I, Section 6
of ch. 1124, 64 Stat. 1107, provides in relevant part:
(a) In the case of children who reside on Federal property --
* * * * *
the Secretary shall make such arrangements (other than
arrangements with respect to the acquisition of land, the
erection of facilities, interest, or debt service) as may be
necessary to provide free public education for such children. *
* * To the maximum extent practicable, the local educational
agency, or the head of the Federal department or agency, with
which any arrangement is made under this section, shall take
such action as may be necessary to ensure that the education
provided pursuant to such arrangement is comparable to free
public education provided for children in comparable communities
in the State, or, in the case of education provided under this
section outside the continental United States, Alaska, and
Hawaii, comparable to free public education provided for
children in the District of Columbia. For the purpose of
providing such comparable education, personnel may be employed
and the compensation, tenure, leave, hours of work, and other
incidents of the employment relationship may be fixed without
regard to the Civil Service Act and rules * * *.
* * * * *
(e) To the maximum extent practicable, the Secretary shall
limit the total payments made pursuant to any such arrangement
for educating children within the continental United States,
Alaska, or Hawaii, 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. The Secretary
shall limit the total payments made pursuant to any such
arrangement for educating children outside the continental
United States, Alaska, or Hawaii, to an amount per pupil which
will not exceed the amount he determines to be necessary to
provide education comparable to the free public education
provided for children in the District of Columbia.
Army Reg. 352-3, 1-7 provides:
Comparison factors. Education provided pursuant to the
provisions of Section 6 for children residing on Federal
property will be considered comparable to free public education
offered by selected communities of the State when the following
factors are, to the maximum extent practicable, equal:
a. Qualifications of professional and nonprofessional
personnel.
b. Pupil-teacher ratios.
c. Curriculum for grades offered, including kindergarten and
summer school, if applicable.
d. Accreditation by State or other accrediting association.
e. Transportation services (student and support).
f. Length of regular and/or summer term(s).
g. Types and number of professional and nonprofessional
positions.
h. Salary schedules.
i. Conditions of employment.
j. Instructional equipment and supplies.
QUESTIONS PRESENTED
1. Whether the wages and money-related fringe benefits of federal
employees whose rate of compensation is not entirely fixed by statute
are negotiable "conditions of employment" under 5 U.S.C. 7103(a).
2. Whether compensation-related proposals -- such as the Union's
proposal in this case to raise the salaries of employees at two
schools for dependents of Army personnel by 13.5% -- are
non-negotiable because they interfere with an agency's management
right under 5 U.S.C. 7106(a) to set the agency's budget.
3. Whether the Union's proposals in this case are non-negotiable
under 5 U.S.C. 7117 because they are "the subject of (an) agency rule
or regulation" for which there is a "compelling need."
STATEMENT
This case involves the negotiability of proposals to increase the
compensation of federal employees. The employees in this case are
teachers at schools for the dependents of personnel stationed at Fort
Stewart, an Army base in Georgia.
A. The Statutory And Regulatory Framework
1. The federal labor relations statute
Title VII of the Civil Service Reform Act of 1978 (CSRA) (sometimes
referred to as the Federal Service Labor-Management Relations
Statute), 5 U.S.C. 7101-7135, establishes "the first statutory scheme
governing labor relations between federal agencies and their
employees." Bureau of Alcohol, Tobacco and Firearms v. FLRA, 464 U.S.
89,91 (1983). The statute grants to federal employees the right to
bargain collectively over their "conditions of employment." 5 U.S.C.
7102(2). The phrase "conditions of employment" is defined to include
"personnel policies, practices, and matters * * * affecting working
conditions, * * * (C) to the extent such matters are (not)
specifically provided for by Federal statute." 5 U.S.C. 7103(a)(14).
Whether or not a matter is a "condition() of employment," the statute
generally provides that nothing in it shall "affect the authority of
any management official of any agency" with respect to certain
enumerated "management rights," including the right "to determine the
* * * budget * * * of the agency." 5 U.S.C. 7106(a)(1). The statute
also precludes an agency from bargaining over proposals that are
"inconsistent with any Federal law or any Government-wide rule or
regulation" (5 U.S.C. 7117(a)(1)) and over "matters which are the
subject of any agency rule or regulation" for which there is a
"compelling need" (5 U.S.C. 7117(a)(2)). See generally FLRA v.
Aberdeen Proving Ground, 108 S. Ct. 1261, 1262 (1988).
It is undisputed that proposals relating to the compensation of
federal employees are generally not negotiable under this scheme. The
pay of most federal employees is set by the General Schedule (See 5
U.S.C. 5332), and their benefits are also governed by statute.
Therefore, compensation is not a "condition() of employment" under
Section 7103(a)(14)(C) with respect to those employees, since it is
"specifically provided for by Federal statute." In addition, it is
clear that bargaining over the compensation of employees subject to
the General Schedule would be barred by Section 7117(a) as
"inconsistent with * * * Federal law." /1/ The largest group of
federal employees governed by Title VII of the CSRA who are not paid
according to the General Schedule are craft workers subject to the
Prevailing Rate Act. See 5 U.S.C. 5341, 5342(a)(2); Union's Br. in
Opp. 4a. It is undisputed that those craft workers may not bargain
about compensation (see id. at 16) because the Prevailing Rate Act
provides that they are to be paid according to the results of wage
surveys conducted in accordance with procedures established by the
Office of Personal Management. 5 U.S.C. 5343. /2/
Under Title VII of the CSRA, if management officials decline to
negotiate over a union's bargaining proposal, the union may file a
negotiability appeal with the Federal Labor Relations Authority (FLRA
or Authority). See 5 U.S.C. 7105(2)(E), 7117(c). The FLRA then makes
a determination -- reviewable in the courts of appeals -- as to
whether the union's proposal is subject to the bargaining obligation
(5 U.S.C. 7117(c)(6)). See Bureau of Alcohol, Tobacco and Firearms,
464 U.S. at 93. The FLRA's determination that a particular bargaining
proposal is negotiable does not, in and of itself, require the
adoption of that proposal. But if negotiation reaches an impasse,
either party may refer the matter to the Federal Service Impasses
Panel, and the Panel is empowered to "take whatever action is
necessary and not inconsistent with (the statute) to resolve the
impasse" (5 U.S.C. 7119(c)(5)(B)(iii)), including the imposition of
the disputed contract term upon the parties. See, e.g., National
Federation of Federal Employees v. FLRA, 789 F.2d 944, 945 (D.C. Cir.
1986); Indiana Air National Guard v. FLRA, 712 F.2d 1187, 1189 n.1
(7th Cir. 1983). Thus, in contrast to private sector collective
bargaining, a determination that a proposal is negotiable "subjects
the agency to the possibility that the Federal Service Impasses Panel
will resolve the dispute by imposing a binding proposal upon the
agency." Nuclear Regulatory Commission v. FLRA, 879 F.2d 1225, 1227
(4th Cir. 1989) (en banc).
2. The domestic dependents schools statute and regulation
Section 6 of Title I of ch. 1124, 64 Stat. 1107, codified as
amended at 20 U.S.C. 241(a), provides for a free public education for
eligible children living on federal property in the United States.
The statute governing these "Section 6 schools" or "dependents
schools" provides that, "(t)o the maximum extent practicable," the
Secretary of Education "shall take such action as may be necessary to
ensure that the education provided * * * is comparable to free public
education provided for children in comparable communities in the
State." /3/ 20 U.S.C. 241(a). The statute further provides that
"personnel may be employed and (their) compensation * * * fixed
without regard to the Civil Service Act" and other federal laws
governing pay, leave, and benefits. 20 U.S.C. 241(a). /4/ Again
"(t)o the maximum extent practicable", 20 U.S.C. 241(e) imposes an
obligation on federal agencies to limit "the total payments * * * for
educating children (at dependents schools) * * * 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."
In order to implement the statutory obligations imposed on the
operation of Section 6 schools, the Army has issued a regulation
governing the education of dependents. Army Reg. 352-3, 1-7. That
regulation states that the education provided by dependents schools
"will be considered comparable to free public education offered by
selected communities of the States" when ten factors, including
"salary schedules," are, "to the maximum extent practicable, equal."
Id. at 352-3, 1-7(h).
B. Proceedings Below
In this case, the Fort Stewart Association of Educators (the
Union), which is the collective bargaining representative for
employees of the two elementary schools operated by Fort Stewart under
the Section 6 program, submitted three proposals for negotiation. The
first proposal, which consisted of 15 subparts, concerned, among other
things, health insurance, life insurance, and mileage reimbursement.
Pet. App. 31a-34a. The second proposal sought to increase the salary
of all bargaining unit members by 13.5%. Id. at 34a. The third
proposal, which also had numerous subparts, concerned various types of
leave, including sick leave, annual leave, personal leave,
professional leave, court leave, maternity/paternity/adoption leave,
and leave without pay. Id. at 48a-54a.
1. The FLRA's decision
In a two-to-one decision, the FLRA determined that the three
proposals were, for the most part, negotiable. /5/ The Authority
first rejected the agency's argument that teachers' pay is not among
the conditions of employment made negotiable by Title VII of the CSRA.
The FLRA adhered to its prior decision that bargaining over employee
compensation is permissible so long as "(1) the matters proposed are
not specifically provided for by law and are within the discretion of
the agency; and (2) the proposals involved are not otherwise
inconsistent with law, applicable Government-wide rule or regulation,
or with an agency regulation supported by a compelling need." Pet.
App. 35a. In this case, the Authority found that nothing in 20 U.S.C.
241 or its legislative history "indicates that Congress intended to
restrict an agency's discretion concerning the particular employment
practices relating to compensation which could be adopted." Pet. App.
36a.
The Authority also found that the proposals did not interfere with
the agency's right to determine its budget, because the Army had not
made 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 by compensating benefits." Pet. App. 36a. After noting that
the dependents school system is comprised of "seven additional
bargaining units with 626 members whose salaries total $11.3 million,"
the Authority nevertheless concluded that the agency "has failed to
establish that increased costs could be expected or even that
increased costs would be unavoidable." Id. at 37a. The Authority also
concluded that the agency had failed to demonstrate that "any
increased costs * * * would not be offset by compensating benefits,"
although it did not identify any benefits that might offset the
increased costs. Id. at 37a-38a.
Finally, the Authority found that the agency had failed to show a
compelling need for Army Regulation 352-3, 1-7(h), which requires
equality of salaries between the dependents schools and their
comparable community counterparts. The Authority instead found that
the statute governing dependents schools was not "intended to restrict
the Agency's discretion as to the particular employment practices
which could be adopted." Pet. App. 40a-41a (citation omitted). /6/
Chairman Calhoun dissented, restating his belief that "in the
absence of a clear expression of congressional intent to make wages
and money-related fringe benefits negotiable," such matters "are not
within the duty to bargain." Pet. App. 46a.
2. The court of appeals' opinion
The court of appeals upheld the Authority's decision. Pet. App.
1a-30a. The court stated that the definition of "conditions of
employment as 'personnel practices and matters * * * affecting working
conditions' * * * alone does not exclude compensation and fringe
benefits." Pet. App. 7a. The court dismissed statements in the
statute's legislative history that "baldly assert that wages are not
negotiable" (id. at 12a) on the ground that they were made "with the
understanding that the Congress generally regulates such matters" (id.
at 10a). Paying deference to the FLRA's interpretation of the statute
(id. at 7a), the court concluded that wages are conditions of
employment under Section 7103(a)(14).
The court also deferred to the FLRA's determination that the
proposals did not interfere with the agency's right to set its budget.
Pet. App. 19a-20a. The court first held that the proposals "would
not necessarily increase the Army's costs." Id. at 20a. In any event,
it concluded, "any increase in the employees' salaries would not
significantly increase the Army's budget," since the Army's budget
"includes bases, troops, weapons, vehicles, other equipment, salaries
for all other officers, and expenses for its eight other schools."
Ibid. The court also held that even if it were clear that the Army's
costs would increase, the Army had failed to show that there would be
"no compensating benefits." Ibid.
In addition, while acknowledging that the proposals conflicted with
the Army's regulation mandating equality of salaries, the court held
that the Army had not established a "compelling need" for that
regulation. Pet. App. 18a-19a. The court found that 20 U.S.C. 241
does not itself "require" the Army to compensate its teachers
according to local public school practices. Pet. App. 18a. Moreover,
the court found that the regulation was not "essential" to the
statutory mandate requiring a "comparable education at a comparable
cost per pupil" (ibid.), since "many expenses beyond * * * salaries"
-- including "books, building maintenance, athletic programs, clubs,
and lunch service" -- "enter into the per pupil expenditures," and
"(m)any factors other than teachers' compensation also affect the
quality of education" (id. at 18a-19a).
SUMMARY OF ARGUMENT
1. Congress did not intend to authorize federal employees to
bargain collectively over their compensation. It extended the
obligation to bargain only to "conditions of employment" (5 U.S.C.
7102(2)), a phrase it defined to include "matters * * * affecting
working conditions" (5 U.S.C. 7103(a)(14)), but said nothing about
wages or other forms of compensation. The phrase "conditions of
employment" suggests the physical aspects of the working environment,
not compensation. Moreover, the distinction between wages and
conditions of employment has long been established in other federal
laws concerning labor relations. And in the two cases where Congress
has authorized federal employees to bargain over compensation --
involving postal workers (see 39 U.S.C. 1201 note) and certain craft
employees (see 5 U.S.C. 5343 note) -- it did so explicitly.
The statute's legislative history removes all doubts on the issue.
As an initial matter, Congress specifically rejected proposals that
would have made wages negotiable generally and in cases such as this.
The participants in the legislative debates then repeatedly assured
their colleagues that the statute does not permit bargaining on
economic matters.
In addition, common sense suggests that Congress would not
obliquely have authorized federal employees to bargain over
compensation. Wages and fringe benefits lie at the core of collective
bargaining in the private sector. One would therefore expect that any
legislation granting the right to bargain over those subjects -- and a
further right to outside arbitration when bargaining leads to an
impasse -- would confer those rights in no uncertain terms.
2. The Union's proposal to increase teachers' salaries by 13.5%
also conflicts with the right to determine the agency's budget, a
right reserved to management by 5 U.S.C. 7106(a)(1). Since teachers'
salaries are by far the largest item in any school's budget, the
proposal would result in an unavoidable and significant increase in
the cost of operating the Fort Stewart schools. The court of appeals'
contrary conclusion, reached only by comparing the cost of the Union's
proposals to the Army's budget as a whole -- including expenditures
for bases, weapons, and troops -- threatens to eliminate the budget
right altogether. The court also erred in demanding that the Army
prove that an across-the-board salary increase would not result in
"compensating benefits" which would offset the resulting increased
costs. The statute grants to the agency, not the FLRA, the right to
decide whether a given expenditure will result in sufficient benefits
to make the expenditure worthwhile.
3. The proposals are also non-negotiable because they conflict with
an Army regulation (Army Reg. 352-3, 1-7) for which there is a
"compelling need" (5 U.S.C. 7117(a)(2)). The statutory provisions
governing the Section 6 school program require the Army to "ensure" as
far as possible that the education provided by the schools is
"comparable" to that provided by local public schools (20 U.S.C.
241(a)), and at the same time limit the per-pupil cost of the Army
schools to no more than the per-pupil cost of those local schools (20
U.S.C. 241(e)). The Army has properly implemented these statutory
commands by requiring that the "salary schedules" of its schools be
"equal" to those of the local public schools. Army Reg. 352-3,
1-7(h). The court of appeals' suggestion that substantial increases
in salaries, benefits, and paid leave could be made up by reducing
expenditures for "books, building maintenance, athletic programs," and
other matters (Pet. App. 18a-19a) -- all the while leaving the quality
of education unaffected and not running afoul of the per-pupil cost
limitation -- is unwarranted and unrealistic.
ARGUMENT
I. THE FEDERAL LABOR RELATIONS STATUTE DOES NOT AUTHORIZE FEDERAL
EMPLOYEES TO BARGAIN COLLECTIVELY OVER THEIR WAGES AND MONETARY FRINGE
BENEFITS
Although the Authority's interpretations of Title VII of the CSRA
are generally entitled to deference, reviewing courts "cannot
rubber-stamp * * * decisions that they deem inconsistent with a
statutory mandate or that frustrate the congressional policy
underlying a statute." Bureau of Alcohol, Tobacco & Firearms v. FLRA,
464 U.S. 89, 97 (1983) (citations omitted); accord FLRA v. Aberdeen
Proving Ground, 108 S. Ct. 1261, 1263 (1988). "The judiciary is the
final authority on issues of statutory construction and must reject
administrative constructions which are contrary to clear congressional
intent." Chevron U.S.A. Inc. v. Natural Resources Defense Council,
Inc., 467 U.S. 837, 843 n.9 (1984). In this case, the language,
structure, and legislative history of Title VII of the CSRA show that
Congress did not intend to authorize federal employees to bargain over
their compensation. Four courts of appeals have therefore held that
the FLRA erred in concluding that wages are negotiable "conditions of
employment." Nuclear Regulatory Commission v. FLRA, 879 F.2d 1225,
1231 (4th Cir. 1989) (en banc), petitions for cert. pending, Nos.
89-198, 89-562; Fort Knox Dependent Schools v. FLRA, 875 F.2d 1179,
1181 (6th Cir. 1989), petition for cert. pending, No. 89-736;
Department of Defense Dependents Schools v. FLRA, 863 F.2d 988, 994
(D.C. Cir. 1988), reh'g en banc granted (Feb. 6, 1989); Department of
the Navy, Military Sealift Command v. FLRA, 836 F.2d 1409, 1419 (3d
Cir. 1988). /7/
1. Title VII of the CSRA extends collective bargaining in the
federal workplace only to "conditions of employment" (5 U.S.C.
7102(2)), which it defines as "personnel policies, practices, and
matters * * * affecting working conditions" (5 U.S.C. 7103(a)(14)).
Examined in isolation, this language is most naturally read to refer
to the physical conditions under which an employee labors. As the
District of Columbia Circuit has noted, "(t)he term 'working
conditions' ordinarily calls to mind the day-to-day circumstances
under which an employee performs his or her job." Department of
Defense Dependents Schools, 863 F.2d at 990; see also Fibreboard
Paper Products Corp. v. NLRB, 379 U.S. 203, 222 (1964) (Stewart, J.,
concurring) (the phrase "conditions of employment" is most naturally
read to encompass "the various physical dimensions" of an employee's
"working environment"). Wages are not a matter "affecting working
conditions." Instead, the opposite is true: one's compensation may be
adjusted to take account of differences in working conditions, not the
other way around. Department of Defense Dependents Schools, 863 F.2d
at 990.
A review of other federal labor statutes confirms that Congress
does not regard "wages" as a "condition() of employment." To the
contrary, it has always specifically mentioned compensation when it
intends to authorize wage bargaining. In the private sector, the
National Labor Relations Act authorizes collective bargaining over
"wages, hours, and other terms and conditions of employment." 29
U.S.C. 158(d). /8/ As the Third Circuit noted in Military Sealift
Command, "Congress's use of only 'conditions of employment' implies a
narrower range of bargainable matters under the Labor-Management
Statute than under the NLRA." 836 F.2d at 1416 n.14; accord Fort Knox
Dependent Schools, 875 F.2d at 1181. In the Postal Reorganization
Act, by contrast, Congress expressly granted postal workers the right
to bargain over "wages, hours, and working conditions." 39 U.S.C. 1201
note (Labor Agreements) (emphasis added). It thus distinguished
between "wages" and "working conditions." /9/ Congress was well aware
of these other statutory provisions when it enacted the CSRA. See,
e.g., H.R. Rep. No. 1403, 95th Cong., 2d Sess. 12 (1978) (recognizing
NLRA); 124 Cong. Rec. 29,182 (1978) (remarks of Sen. Udall) (noting
bargaining practice in Postal Service). Thus if Congress had intended
to authorize bargaining over wages and wage-related benefits, it would
have said so.
Congress also distinguished between wages and conditions of
employment in Section 704 of the CSRA. That Section provides that
those craft employees (see 5 U.S.C. 5342(a)(2)) who bargained over
compensation prior to 1972 may continue to bargain over "terms and
conditions of employment and other employment benefits," including
"pay and pay practices." 92 Stat. 1218, reprinted in 5 U.S.C. 5343
note. "The normal rule of statutory construction assumes that
identical words used in different parts of the same act are intended
to have the same meaning." Sorenson v. Secretary of Treasury, 475 U.S.
851, 860 (1986) (citations omitted). Accordingly, there is no reason
to conclude that Congress intended that "conditions of employment"
would encompass wages in Title VII of the CSRA when, in providing in
Section 704 of the same Act that certain employees could bargain over
wages, it spoke of terms and conditions of employment, and
specifically mentioned pay and pay practices. /10/
2. Any doubt as to Congress's intent to exclude
compensation-related matters from the definition of conditions of
employment is removed by the statute's legislative history. That
history is "replete * * * with indications that Congress did not
intend to subject pay of federal employees to bargaining." Military
Sealift Command, 836 F.2d at 1417; accord Nuclear Regulatory
Commission, 879 F.2d at 1228; Fort Knox Dependent Schools, 875 F.2d
at 1181; Department of Defense Dependents Schools, 863 F.2d at 992.
In enacting Title VII of the CSRA, Congress twice rejected
proposals to make pay negotiable. First, Congressman Ford introduced
a bill that would have made pay generally negotiable for federal
employees (see 124 Cong. Rec. 25,721 (1978) (discussing H.R. 9094)),
but the bill was not passed. Later, in the House committee markup,
Representative Heftel unsuccessfully introduced a more limited
proposal that would have extended the obligation to negotiate to "pay
practices" and "overtime practices" so far as "consonant with law and
regulation." House Comm. on Post Office & Civil Service, Subcomm. on
Postal Personnel & Modernization, 96th Cong., 1st Sess., Legislative
History of the Federal Service Labor-Management Relations Statute
1087-1088 (1979) (proposing new Section 7115(b)). This unsuccessful
attempt to extend the bargaining obligation to wages is particularly
significant because "(f)ew principles of statutory construction are
more compelling than the proposition that Congress does not intend sub
silentio to enact statutory language that it has earlier discarded in
favor of other language." INS v. Cardoza-Fonseca, 480 U.S. 421,
442-443 (1987) (citations omitted).
In addition, there are numerous statements in the committee reports
that the statute was not meant to authorize wage bargaining. The
Senate Report states, without exception, that Title VII of the CSRA
"excludes bargaining on economic matters." S. Rep. No. 969, 95th
Cong., 2d Sess. 13 (1978). The House Report similarly provides that
the statute "does not permit * * * bargaining on wages and fringe
benefits." H.R. Rep. No. 1403, 95th Cong., 2d Sess. 12 (1978). A
supplemental statement to the House report, signed by various members
of the governing Committee, emphasized that "(a)mong the collective
bargaining rights not included in the bill are: * * * (2) The right
to bargain collectively over pay and money-related fringe benefits
such as retirement benefits and life and health insurance." Id. at
377. In the same vein, the supplemental views of Rep. Solarz noted
that the statute "provide(s) that such matters as pay and fringe
benefits be excluded from collective bargaining." Id. at 390.
Statements in the floor debate -- by the major figures in the
bill's passage -- are to the same effect. Representative Udall, who
authored the compromise that was eventually enacted and whose views
must therefore be accorded significant weight (Simpson v. United
States, 435 U.S. 6, 13 (1978)), stressed that the bill would "not
permit bargaining over pay and fringe benefits" (124 Cong. Rec. 25,716
(1978)). He later reiterated the point: "There is not really any
argument in this bill or in this title about Federal collective
bargaining for wages and fringe benefits and retirement -- the kinds
of things that are giving us difficulty in the Postal Service today."
Id. at 29,182. Similarly, Representative Clay, a proponent of broad
collective bargaining in the public sector, stated unequivocally that
federal "employees still * * * cannot bargain over pay." Id. at
24,286. He reemphasized the point later on in the debate, stating:
"I also 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 25,720. In addition,
Representative Ford, who had proposed the bill that would have allowed
all federal employees to bargain about pay, noted 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" under the bill Congress passed. Id. at 25,721; see also
id. at 29,188 (remarks of Rep. Derwinski) (stating that "wages, fringe
benefits, and number of employees in an agency" remain beyond the
scope of collective bargaining).
3. The court of appeals acknowledged that "some legislators'
remarks baldly assert that wages are not negotiable." Pet. App. 12a.
Yet it dismissed those statements as irrelevant because, in its view,
other comments "indicate that the legislators merely were assuring
their peers that the (statute) would not supplant specific laws which
set wages and benefits." Ibid.; see H.R. Rep. No. 1403, 95th Cong., 2d
Sess. 12 (1978) (fringe benefits are excluded from bargaining "because
they are specifically provided for by statute"); 124 Cong. Rec.
29,174 (1978) (remarks of Rep. Collins) (criticizing the bill because
it excluded from bargaining "those few (matters) specifically
prescribed by law -- for example, pay and benefits"). But these
comments, which relate the prohibition against wage negotiation to the
fact that Congress sets the wages of most federal employees, do not
say or suggest that only the wages of such employees cannot be
negotiated. Thus they do not conflict with the repeated statements in
the legislative history that wages are not negotiable at all, and
those statements are consistent with the most natural reading of the
statutory language. "(T)he presumption that legislators mean what
they say would seem more appropriate than the opposite presumption." K
Mart Corp. v. Cartier Corp., 108 S. Ct. 1811, 1824 n.4 (1988)
(Brennan, J., concurring in part and dissenting in part). /11/
The court of appeals also based its holding on two decisions of the
FLRA's predecessor, the Federal Labor Relations Council (FLRC), which
"allowed federal employees to negotiate wages in the rare instances
where Congress did not specifically establish wages and fringe
benefits." Pet. App. 12a (citing Overseas Education Association, Inc.
and Department of Defense, Office of Dependents Schools, 6 F.L.R.C.
231, 231 (1978), and United Federation of College Teachers and U.S.
Merchant Marine Academy, 1 F.L.R.C. 211, 212 (1972)). The court noted
the provision of 5 U.S.C. 7135(b) that pre-CSRA decisions remain in
effect "unless superseded" and said that "Congress should have known"
of the two FLRC decisions. Pet. App. 12a-13a.
The court of appeals' reliance on the two FLRC decisions is
misplaced. First, the prior law was superseded by Section 7102(2),
which provides that only "conditions of employment" are negotiable.
/12/ As we have shown, Congress has long understood that phrase not to
include wages, and the legislative history of Title VII of the CSRA
confirms that the phrase was not given a different meaning here.
Thus, the assumption of the court below that Congress intended the
FLRC decisions to continue in force "is plainly inapposite in a
situation, such as the case at hand, where Congress has clearly
expressed its intent to the contrary." Department of Defense
Dependents Schools, 863 F.2d at 993 n.9. /13/
Second, the two FLRC decisions are nowhere mentioned in the
legislative history and it appears that Congress was unaware of them.
Indeed, in describing federal labor relations practices under the
Executive Order, Senator Sasser told his colleagues that "Federal
employees may not bargain over pay or fringe benefits." 124 Cong. Rec.
27,549 (1978); see id. at 24,286 (statement of Rep. Clay) ("employees
still * * * cannot bargain over pay" under Title VII of the CSRA).
Thus, to the extent that Congress intended to continue pre-CSRA
bargaining practices, it evidently believed that, under those
practices, wage bargaining was not allowed. /14/
4. Finally, given that wages are the central subject of collective
bargaining in the private sector, common sense suggests that Congress
would not authorize collective bargaining over the wages and fringe
benefits of federal employees through "vague intimation or oblique
reference." Nuclear Regulatory Commission, 879 F.2d at 1228.
Moreover, federal wage bargaining would involve not only negotiation
but third-party arbitration when an impasse was reached. Such a
process would effect a "withdrawal of political accountability in
public-sector compensation that substitutes for the competitive
pressures constraining private-sector collective bargaining." Id. at
1231. Thus any determination that Congress has authorized wage
bargaining for federal employees should be supported by convincing
evidence. See also Fort Knox Dependent Schools, 875 F.2d at 1182
("(i)t is obvious that salary and fringe benefits are the items most
likely to involve substantial overspending if left to collective
bargaining"). Unlike all the instances in which Congress has
authorized bargaining over wages, no such clear evidence exists in
this case. /15/
II. THE PROPOSALS INTERFERE WITH THE AGENCY'S RIGHT TO SET ITS
BUDGET
The "management rights" provision of Title VII of the CSRA, 5
U.S.C. 7106(a), provides that agency management need not bargain over
certain specified matters. That provision was enacted in order to
give the federal government "the power to manage and the flexibility
that it needs." 124 Cong. Rec. 29,182 (1978) (remarks of Sen. Udall).
Through the "broad statement of management rights" (H.R. Rep. No.
1403, 95th Cong., 2d Sess. 12 (1978)), Congress "specifie(d) areas for
decision which are reserved to the President and heads of agencies,
which are not subject to the collective bargaining process" (S. Rep.
No. 969, 95th Cong., 2d Sess. 12-13 (1978)).
Among the rights listed in Section 7106(a) is management's right to
set the budget: the statute provides that nothing in Title VII of the
CSRA shall "affect the authority of any management official of any
agency -- (1) to determine the * * * budget * * * of the agency."
Accordingly, proposals that would affect the agency's budget implicate
matters on which the agency "may not negotiate under any
circumstances." H.R. Conf. Rep. No. 1717, 95th Cong., 2d Sess. 153
(1978); see H.R. Rep. No. 1403, supra, at 43 ("Management may not
bargain away its authority to make decisions in these areas"); 124
Cong. Rec. 27,539 (1978) (remarks of Sen. Percy) (agency budgets are
"(s)pecifically excluded from the scope of bargaining").
The FLRA has decided that a proposal is non-negotiable on account
of management's right to control the agency budget if the proposal
"will result in significant and unavoidable increases in costs not
affected by compensating benefits." Pet. App. 36a (citing American
Federation of Government Employees, AFL-CIO and Air Force Logistics
Command, Wright-Patterson Air Force Base, Ohio, 2 F.L.R.A. 604
(1980)). Almost all proposals have some costs and some effect on
agency expenditures, and, accordingly, a rule that a proposal is not
barred unless it has more than a de minimis budgetary effect seems
reasonable. However, 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. And 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. The decision whether benefits are worth the cost lies
at the heart of the budget process.
1. Contrary to the FLRA (Pet. App. 37a) and the court of appeals
(id. at 20a), the proposals here, if adopted, would have a significant
impact on the budget of the Fort Stewart Schools. "Teacher salaries"
are "by far the largest item in any school's budget." San Antonio
Independent School District v. Rodriguez, 411 U.S. 1, 11 (1973). A
13.5% across-the-board pay raise for teachers would therefore have a
"significant" effect on the school budget under any reasonable use of
the term. Even apart from the increase in expenditures that
implementation of the proposal would require, the proposal would have
a "significant effect" by depriving management of control over the
major item in its budget. And in this case, the proposed pay raise
would substantially increase the agency's costs. /16/
The court of appeals considered the costs of the Union's proposals
insignificant only because it compared the increase in the cost of
operating the dependent schools to the Army's budget as a whole,
including the cost of "bases, troops, weapons, vehicles, other
equipment, salaries for all other officers, and expenses for its eight
other schools." Pet. App. 20a. That approach makes no sense. Whether
a proposal will have a significant budgetary effect should be tested
by comparison with the expenditures of the program employing the
bargaining unit employees, not the entire agency budget. Otherwise,
few proposals could be found to have "significant" effects, and the
budget right would be a virtual nullity. That consequence is
especially clear in this case. Given the Army's share of the defense
budget, any proposal involving dependents schools could only amount to
a tiny percentage of the Army's total expenditures, or even of its
salaries for personnel. /17/ Thus, if Congress's judgment that agency
management must have control over the agency budget is to be honored,
the effect of a proposal must be tested against the program budget,
not the agency budget. /18/
2. The FLRA's requirement of proof that a proposal would not have
compensating benefits is unreasonable and contrary to the statute. It
is unreasonable because it requires the agency to prove a negative --
a requirement it could seldom, if ever, satisfy. In this case, for
example, the only compensating benefit that has been suggested is that
higher salaries and improved benefits will "attract better,
harder-working teachers." Union's Br. in Opp. 18. That the FLRA is
willing to rely on such an assertion indicates that any proposal to
increase compensation would, in its view, be negotiable.
The compensating benefits requirement is contrary to the statute
because "the FLRA's test makes itself, not the agency, the arbiter of
the agency's budget." Nuclear Regulatory Commission, 879 F.2d at 1233.
A budget is "a plan for the coordination of resources (as of money or
manpower) and expenditures." Webster's Third New International
Dictionary 290 (1981). The quintessential decision that a federal
agency makes when determining its budget is whether the benefits that
flow from a given allocation of resources exceed its costs. See Exec.
Order No. 12,291, 3 C.F.R. 127 (1982) (requiring cost-benefit analysis
for agency actions). Thus, to preserve to management the right to
determine the agency's budget, as Congress did, is to say that it is
up to management, and management alone, to determine the optimal
allocation of the agency's resources. See Nuclear Regulatory
Commission, 879 F.2d at 1233 ("Congress * * * has vested the NRC with
the responsibility of balancing employee compensation against the
agency's other goals").
III. THE PROPOSALS ARE INCONSISTENT WITH AN ARMY REGULATION FOR
WHICH THERE IS A "COMPELLING NEED"
Federal agencies are not required to bargain over "matters which
are the subject of an() agency rule" for which there is a "compelling
need." 5 U.S.C. 7117(a)(2). /19/ Section 241(a) of the dependents
schools statute directs the government to provide an education
comparable to that provided by local public schools, while Section
241(e) requires the Army to do so at a comparable per-pupil cost. The
Army's dependents schools regulation (Army Reg. 352-3, 1-7(h))
implements the mandate of Sections 241(a) and 241(e) by stating that
the education provided by Section 6 schools "will be considered
comparable to free public education offered by selected communities of
the States" when various factors, including "salary schedules," are,
"to the maximum extent practicable, equal." It is undisputed that the
proposals at issue, most of which do not purport to make teachers'
compensation at the Fort Stewart Schools comparable to that provided
at public schools in the State, are contrary to the regulation. /20/
Section 241 does not specifically provide that teachers' salaries
at dependents schools must be set by comparison with those at local
public schools. /21/ But Congress recognized the importance of
teachers' salaries in the dependents school statute by stipulating
that "(f)or the purpose of providing such comparable education,"
teachers' salaries and benefits "may be fixed without regard to the
Civil Service Act." 5 U.S.C. 241(a). Because teachers' salaries are
such an important component of per-pupil costs, it is a fair reading
of the statute to conclude that Congress excepted them from the civil
service laws so that they would be set by comparison with those at
public schools. /22/ Thus, even in the absence of the regulation,
proposals relating to teachers' compensation would appear to be
non-negotiable under Section 7117(a)(1) as "inconsistent with * * *
Federal law."
In any event, the Army has promulgated the regulation at issue.
And because education is so labor-intensive, there is a compelling
need for that regulation within the meaning of Section 7117(a)(2).
/23/ In view of Section 241(e)'s requirement of comparable per pupil
costs, any substantial increase in teacher salaries at dependents
schools would force substantial cutbacks elsewhere. And if, for
example, the schools decided that in order to offset a salary increase
they had to hire fewer teachers, thereby adversely affecting the
pupil-teacher ratio, parents justifiably would complain that the Army
was not complying with Section 241(a)'s mandate to provide an
education comparable to that provided at local public schools. Thus,
the Army's regulation is surely correct when it states that, in
designing a system to provide an education comparable to that at
public schools in the State at a comparable per-pupil cost, it is
necessary to pay teachers comparable salaries. /24/
The primary basis for the court of appeals' decision to overturn
the Army's regulation was its conclusion that the Army can provide a
comparable education at a comparable per-pupil cost "notwithstanding
large variations in the employees' wages because many expenses beyond
their salaries enter into the per pupil expenditures." Pet. App. 18a.
But the court gave no useful guidance as to "how this legerdemain
might be accomplished." Fort Knox Dependent Schools, 875 F.2d at 1182.
It is fanciful to say that the Army can permit a 13.5% increase in
salaries, or a significant increase in paid leave and benefits, and
still provide a comparable education at a comparable per-pupil cost.
The court's suggestion that the schools might cut back on "books,
building maintenance, athletic programs, clubs, and lunch services"
(Pet. App. 19a) is not helpful, since such costs are a relatively
small percentage of any school system's budget. See Simon, The School
Finance Decisions: Collective Bargaining and Future Finance Systems,
82 Yale L. J. 409, 418 & n.36 (1973). Even if the deficit could be
made up by drastically cutting non-wage expenditures, it would be
unlikely that the resulting education would be comparable. As the
court of appeals acknowledged, "(m)any factors other than teachers'
compensation also affect the quality of education." Pet. App. 19a. A
school system that promotes teacher compensation to the exclusion of
those other factors cannot provide an education comparable to local
public school systems that treat teacher compensation as one factor
among many contributing to a quality education. /25/
The court of appeals also noted (Pet. App. 19a) that Section 241(a)
and Section 241(e) both require compliance with the obligations they
impose "to the maximum extent practicable." But, contrary to the court
of appeals' suggestion, these provisos do not confer a wide-ranging
grant of discretion. To the contrary, the statute mandates
comparability to the maximum extent practicable. Through the
provisos, Congress has provided a limited safety-valve permitting the
Army to diverge from the statutory mandates when, as a practical
matter, it would be extremely difficult to comply with them. There is
no contention that the proposals here are justified by considerations
making comparability impractical. And there is no reason to interpret
the provisos to overrule the rest of the statute by authorizing
bargaining over proposals that do not purport to be based on practices
at local public schools.
CONCLUSION
The judgment of the court of appeals should be reversed.
Respectfully submitted.
JOHN G. ROBERTS, JR.
Acting Solicitor General
STUART M. GERSON
Acting Solicitor General /26/
DAVID L. SHAPIRO
Deputy Solicitor General
CHRISTOPHER J. WRIGHT
Assistant to the Solicitor General
WILLIAM KANTER
JACOB M. LEWIS
Attorneys
NOVEMBER 1989
/1/ We would add, although the respondents do not agree with this
third ground, that bargaining over the wages of any federal employees
subject to Title VII of the CSRA conflicts with agency management's
right to set the agency budget.
/2/ Another large group of federal employees, postal workers, are
not governed by Title VII of the CSRA. 5 U.S.C. 2105(e). Their
governing statute expressly provides that wages are negotiable. 39
U.S.C. 1201 note.
/3/ The Secretary of Education and his predecessors have delegated
the day-to-day operation of the schools to the individual branch of
the armed services with which the installation is affiliated. See S.
Rep. No. 1137, 95th Cong., 2d Sess. 106-107 (1978).
/4/ There are "forty-odd federal pay systems which are not entirely
fixed by statute." Department of Defense Dependents Schools v. FLRA,
863 F.2d 988, 989 (D.C. Cir. 1988), reh'g en banc granted (Feb. 6,
1989). In addition to teachers at domestic dependents schools,
included among the federal employees who are not subject to the
General Schedule or the Prevailing Rate Act are teachers at overseas
dependents schools, which are governed by a different statute (20
U.S.C. 901-907) from that governing domestic schools; civilian
mariners employed by the Navy, whose pay, under 5 U.S.C. 5348, is set
by comparison with mariners employed by private vessels; electricians
employed by the Bureau of Engraving and Printing, who are governed by
5 U.S.C. 5349(a); and employees of the Nuclear Regulatory Commission,
who are excepted from the General Schedule by 42 U.S.C. 2201(d).
/5/ The FLRA held that Subparts L and M of Proposal 1, which
proposed that the schools provide free health and life insurance, were
not negotiable because they were inconsistent with federal law within
the meaning of 5 U.S.C. 7117(a)(1). It reached that conclusion
because federal statutes limit the amount the schools may contribute
toward health insurance and specifically require union members to
contribute toward life insurance. Pet. App. 41a. The Authority also
held that Section F(1) of Proposal 3, which proposed that leave
without pay "may be approved at the discretion of the immediate
supervisor" (id. at 53a), infringed on management's reserved right to
assign work. Id. at 44a; see 5 U.S.C. 7106(a)(2)(B). These holdings
are not before this Court.
/6/ The Authority also rejected the agency's arguments that the
proposals violated a federal procurement statute, 10 U.S.C. 2304, and
the Antideficiency Act, 31 U.S.C. 1341. Pet. App. 39a-40a. These
objections were not pressed on appeal and are not before this Court.
/7/ Only the Second Circuit has agreed with the court below on this
issue. West Point Elementary School Teachers Association v. FLRA, 855
F.2d 936, 942 (1988).
/8/ The court below reasoned that "(b)y using the word "other,"
Congress included wages and hours in the general category of
"conditions of employment." Pet. App. 8a. But the phrase employed in
29 U.S.C. 158(d) is "wages, hours, and other terms and conditions of
employment" (emphasis added). The symmetry of the phrase suggests
that wages were thought to be a "term" and hours a "condition" of
employment. Department of Defense Dependents Schools, 863 F.2d at
991.
Other sections of the NLRA employ sightly different terminology.
See 29 U.S.C. 151 (preamble) (referring to "the friendly adjustment of
industrial disputes arising out of differences as to wages, hours or
other working conditions"); 29 U.S.C. 159 (mentioning "rates of pay,
wages, hours of employment, or other conditions of employment").
Neither of these alternative formulations equates wages with
conditions of employment, however, and both are consistent with the
conclusion that Congress thinks of hours, but not wages, as a
condition of employment.
/9/ Other federal statutes make the same distinction. See Title
VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e-2(a)(1)
(prohibiting discrimination "with respect to his compensation, terms,
conditions, or privileges of employment"); Defense Department
Overseas Teachers Pay and Personnel Program Act, 20 U.S.C. 902
(distinguishing between authority to promulgate regulations concerning
"the payment of compensation" (20 U.S.C. 902(a)(4)) and regualtions
concerning "the conditions of employment" (20 U.S.C. 902(a)(6)) of
overseas teachers); 25 U.S.C. 2011 (making the same distinction with
regard to teachers at Indian schools).
There are a few statutes that do not clearly distinguish pay from
conditions of employment. See The Senior Executive Service Act, 5
U.S.C. 3131(1) (providing for "a compensation system, including
salaries, benefits, and incentives, and for other conditions of
employment"); 18 U.S.C. 4082(c)(2)(iii) (providing for "the rates of
pay and other conditions of employment" of federal prisoners on
work-release). But even these relatively obscure statutes do not
expressly define wages to be a condition of employment. In any event,
they show that when Congress addresses the subject of federal
compensation, it does so by using terms that admit of no uncertainty.
/10/ The statute's explicit preservation of management's right to
"determine the * * * budget * * * of the agency" (5 U.S.C. 7106(a)(1))
is also inconsistent with the conclusion that Congress intended to
authorize collective bargaining over federal wages. It makes little
sense to interpret a statute that goes out of its way to immunize
budget-setting from the collective bargaining process in a manner that
permits bargaining over one of the most significant components of any
agency's budget. See pp. 27-31, infra.
/11/ The court of appeals also noted (Pet. App. 11a) that, in
discussing Section 7103(a)(14)(C), which removes from the definition
of "conditions of employment" matters that are "specifically provided
for by Federal statute," Representative Clay stated that "where a
statute merely vests authority over a particular subject with an
agency official with the official given discretion in exercising that
authority, the particular subject is not excluded by this subsection
from the duty to bargain over conditions of employment." 124 Cong.
Rec. 29,187 (1978). However, Representative Clay nowhere suggested
that pay is among those discretionary issues that are bargainable
under any circumstances. In view of his assurances that pay is not
negotiable under the bill, the court of appeals' conclusion that he
thought otherwise, based on his statement with respect to Section
7103(a)(14)(C), "puts Congressman Clay at war with himself over the
issue." Military Sealift Command, 836 F.2d at 1418.
/12/ The language of Section 11(a) of Executive Order No. 11,491
(see 5 U.S.C. 7101 note), which governed federal-sector labor
relations prior to 1978 and made "working conditions" negotiable, is
admittedly similar to the definition of "conditions of employment" in
Section 7103(a)(14). But the Executive Order did not use the phrase
"conditions of employment."
/13/ Moreover, the issue whether wages are "working conditions" was
not squarely presented (or addressed by the FLRC) in either case.
Rather, the question presented in both cases was whether the proposals
at issue were contrary to other statutes and regulations -- a question
analogous to the third question presented here. Thus, at most, the
FLRC decided only sub silentio that compensation was a negotiable
working condition.
/14/ Furthermore, the two FLRC cases are inapposite because, in
both cases, the proposals at issue sought to implement the governing
law. In United Federation of College Teachers, teachers at the
Merchant Marine Academy, who were to be paid salaries comparable to
those paid at the Naval Academy, made proposals that "fall within the
range of 'comparability' or 'similarity.'" 1 F.L.R.C. at 212.
Similarly, in Overseas Education Association, which involved teachers
at overseas schools operated by the United States government who were
to be paid salaries comparable to those paid in large urban school
districts in the United States, the proposal at issue implemented the
governing statute by providing that salaries would be determined by
sampling a geographically diverse set of cities constituting 60% of
the school districts in cities with populations of over 100,000. The
FLRC found "no indication" that the proposal would fail to implement
the statute properly. 6 F.L.R.C. at 233. Here, in contrast, the
majority of the proposals at issue -- including the proposed 13.5% pay
raise -- do not purport to be modeled on practices at comparable
public schools in the State, as the dependents schools statute
provides. Thus, even if the two FLRC decisions did support the
conclusion that bargaining over wages is appropriate in some
circumstances, they would not support the conclusion that the
proposals here are negotiable.
/15/ If the Court reverses the decision of the court of appeals on
the basis that compensation is not a negotiable condition of
employment, then, as Chairman Calhoun concluded (Pet. App. 46a), all
of Proposals 2 and 3 are non-negotiable, and all but subparts A and D
of Proposal 1 (which appear merely to require Fort Stewart to inform
and consult with the Union) are non-negotiable.
/16/ Whether each of the various subparts of Proposals 1 and 3
would have a significant effect is not as clear. If the Court reverses
the decision below on the basis of the budget question alone, it may
wish to remand the case with instructions that the FLRA reconsider the
negotiability of the other proposals under the appropriate standard.
/17/ In fiscal year 1989, Congress appropriated more than $24.48
billion for pay and allowances for the military personnel employed by
the Army. Department of Defense Appropriations Act, 1989, Pub. L. No.
100-463, 102 Stat. 2270.
/18/ The Union argues (Br. in Opp. 17-18) that the language of the
management rights provision, which states that management has control
over the budget "of the agency," supports the conclusion that a
proposal must be tested against the agency budget as a whole. But
read literally, Section 7106(a)(1) gives management unfettered control
over the budget. While we concede that some sort of de minimis test
should be employed so that the scope of bargaining is not restricted
unduly, nothing in the language of the statute requires such a test.
Moreover, although it is appropriate to restrict the literal language
of the budget right so as not to eclipse the bargaining obligation, it
is not necessary to render the budget right meaningless.
/19/ The Authority has set forth "illustrative criteria" for
determining whether an agency regulation is supported by a compelling
need. Under these criteria, a compelling need exists for an agency
regulation if the regulation "implements a mandate to the agency * * *
which implementation is essentially nondiscretionary in nature" (5
C.F.R. 2424.11(c)), or if the regulation "is essential, as
distinguished from helpful or desirable, to the accomplishment of the
mission or the execution of functions of the agency" (5 C.F.R.
2424.11(a)).
/20/ Accordingly, if the Court reverses the decision below on the
ground that the proposals conflict with the Army's regulation, all of
Proposals 2 and 3 would be non-negotiable. All of Proposal 1 except
for subparts A and D, which appear to assume (contrary to the other
proposals) that compensation is to be set by comparison with local
public schools, would also be non-negotiable.
/21/ If it did, then proposals relating to compensation would be
non-negotiable under Section 7103(a)(14)(C), which provides that
"conditions of employment" do not include matters that are
"specifically provided for by Federal statute." An explicit statutory
direction that teachers' salaries are to be set by comparison with
those of their counterparts at public schools would "specifically
provide() for" the matter. Respondents should not disagree on this
point, as they concede (see Union's Br. in Opp. 16) that craft
employees subject to the Prevailing Rate Act may not bargain about
their compensation.
/22/ It is not clear that Congress intended that all ten of the
factors listed in the Army's regulation, including those that do not
directly and substantially affect per-pupil costs, be set by
comparison with public schools.
/23/ The FLRA suggests in 5 C.F.R. 2424.11 that there is a
compelling need for a regulation only if it implements a statutory
mandate that leaves an agency absolutely no room for discretion. But
that cannot be the rule. If it were, there would be no case where a
proposal was not exempted from negotiability under Section 7117(a)(1)
as inconsistent with federal law, but nevertheless was exempted under
Section 7117(a)(2) as contrary to an agency regulation for which there
is a compelling need. In other words, under the FLRA's rule, Section
7117(a)(2) would add little or nothing to Section 7117(a)(1).
/24/ Maintaining equality of teacher salaries is also important in
furthering Congress's goal of assisting those local school systems
that suffer adverse economic effects caused by their proximity to
large federal installations. Section 1, 64 Stat. 1100-1101; S. Rep.
No. 2458, 81st Cong., 2d Sess. 1-2 (1950); H.R. Rep. No. 1137, 95th
Cong., 2d Sess. 1-3 (1978). If the Section 6 schools paid more and
had appreciably more desirable leave and benefit policies than
neighboring local school systems, those systems would probably be
forced to match salary and benefits or suffer a loss in the quality of
their personnel. Thus, increases in compensation due to collective
bargaining proposals submitted by teachers at dependents schools would
place an economic burden on local school systems that would undermine
the statute's goal of assisting -- not burdening -- the local public
schools.
/25/ The court of appeals also stated (Pet. App. 14a) that to
interpret "comparable education" to require "comparable salaries"
would be impermissible because it would render redundant Section
241(a)'s requirement that teachers employed in U.S. territories
receive "compensation * * * on the same basis as provided for similar
positions in the public schools in the District of Columbia." (Under
Section 241(a), schools in the territories are to be comparable to
schools in the District of Columbia.) But in fact, as the legislative
history of that provision shows, it was intended simply to
"unequivocally align" the salaries of teachers in the territories with
those of the D.C. public schools, not to establish a new statutory
requirement. See H.R. Rep. No. 1137, 95th Cong., 2d Sess. 108 (1978).
In any event, since the cost of living in the territories might be
significantly different from the cost of living in the District of
Columbia, there might be some question as to whether it was necessary
to pay the same salary in the territories to hire comparable teachers.
But there is no serious question that a comparable education requires
comparable teachers' salaries where, as here, the Army has been
directed to provide an education comparable to that provided by public
schools in the same State where the dependents schools are located.
/26/ The Solicitor General is disqualified in this case.