US DHS Customs and Border v. FLRA ( 2014 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued January 16, 2014 Decided June 3, 2014
No. 12-1457
UNITED STATES DEPARTMENT OF HOMELAND SECURITY U.S.
CUSTOMS AND BORDER PROTECTION,
PETITIONER
v.
FEDERAL LABOR RELATIONS AUTHORITY,
RESPONDENT
NATIONAL TREASURY EMPLOYEES UNION,
INTERVENOR
Consolidated with 13-1073
On Petition for Review and
Cross-Application for Enforcement of
Final Decision of the Federal Labor Relations Authority
Howard S. Scher, Attorney, U.S. Department of Justice,
argued the cause for petitioner. With him on the briefs were
Stuart F. Delery, Deputy Attorney General, and Leonard
Schaitman, Attorney.
Zachary R. Henige, Attorney, Federal Labor Relations
Authority, argued the cause for respondent. On the brief were
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Rosa M. Koppel, Solicitor, and Douglas E. Callahan,
Attorney.
Julie M. Wilson argued the cause for intervenor. With her
on the brief were Gregory O’Duden, Larry J. Adkins, and
Jacob Heyman-Kantor.
Before: HENDERSON, Circuit Judge, and EDWARDS and
SENTELLE, Senior Circuit Judges.
Opinion for the Court filed by Senior Circuit Judge
EDWARDS.
Circuit Judge HENDERSON concurs in the judgment.
EDWARDS, Senior Circuit Judge: This case presents a
petition for review filed by the United States Department of
Homeland Security (“DHS”) challenging a decision by the
Federal Labor Relations Authority (“FLRA” or “Authority”).
The dispute arose with the FLRA on a negotiability appeal
filed by the National Treasury Employees Union (“NTEU” or
“Union”) under 5 U.S.C. § 7105(a)(2)(E) of the Federal
Service Labor-Management Relations Statute (“FSLMRS”).
NTEU and Customs and Border Protection (“CBP”) – an
agency within DHS – had negotiated a collective bargaining
agreement that included the following provision:
An employee [in CBP] being interviewed by a
representative of the Agency (e.g., Department of
Homeland Security Office of Inspector General) in
connection with either a criminal or non-criminal matter
has certain entitlements/rights regardless of who is
conducting the interview.
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Article 22, Section 2 (“Section 2”). See NTEU Petition for
Review of Negotiability Issues, May 18, 2010, at 3-4, ¶ 9,
reprinted in Joint Appendix (“J.A.”) 10-11. NTEU explained
that the proposed Section 2 was intended to have the
following effects:
The impact of the proposal is to obligate all employer
representatives to abide by Article 22. Among other
things, Article 22 requires that union officials receive
advance notice of employee interviews; that interviews
be conducted at the worksite; that employer
representatives act professionally; that the employer
representatives provide employees with specific
negotiated forms with their rights outlined prior to
conducting the interview; and that employer
representatives advise employees of their right to union
representation if the employee may be subject to
discipline or adverse action before the interview is
conducted. The impact, therefore, of the provision at
issue is to obligate all employer representatives to adhere
to these negotiated provisions when conducting
investigatory interviews (criminal and noncriminal) of
CBP bargaining unit employees. It specifically identifies
employees from DHS’s OIG as employer representatives
when they conduct these investigations of CBP
employees, but the provision would apply to any other
individuals acting in that capacity, for that purpose.
NTEU Petition for Review of Negotiability Issues at 4-5,
¶ 12, reprinted in J.A. 11-12.
DHS objected to the collective bargaining agreement
pursuant to § 7114(c) of the FSLMRS on the ground that
procedures followed by DHS’s Office of Inspector General
(“OIG”) in conducting its investigations are nonnegotiable.
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After the Union and CBP severed Section 2 from their
collective bargaining agreement, DHS approved the
agreement without the provision, and the Union then filed a
negotiability appeal with the Authority.
Before the FLRA, DHS pointed out that the OIG is an
independent entity located within the agency but excluded
from collective bargaining. DHS also pointed out that the OIG
did not participate in the negotiations that culminated in the
adoption of the disputed contract provision. DHS’s principal
argument, however, both before the Authority and in this
court, rests on the Inspector General Act of 1978 (“IG Act”),
5 U.S.C. App. 3 §§ 1-13:
An agency’s duty to bargain in good faith under the
FSLMRS applies only “to the extent” that duty is “not
inconsistent with any Federal law.” 5 U.S.C. 7117(a)(1).
Collective bargaining for restrictions on the techniques
and procedures employed by an OIG in conducting its
investigations is inconsistent with federal law, namely,
the Inspector General Act. The latter describes the OIG
as an independent entity free from agency interference –
including restrictions arrived at through collective
bargaining – in the investigation of agency activities.
Br. for Pet’r at 16. In advancing this position, DHS relied
heavily on the Fourth Circuit’s decision in U.S. Nuclear
Regulatory Comm’n v. FLRA (“NRC”), 25 F.3d 229, 235-36
(4th Cir. 1994) (holding that the OIG is not subject to
collective bargaining under the FSLMRS, and it may not be
bound by the terms of an agreement negotiated by a union on
behalf of other employees in an agency).
The Authority rejected DHS’s position and ruled that the
disputed contract provision was negotiable. National Treasury
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Employees Union, 66 F.L.R.A. 892, 892 (2012) (“FLRA
Decision”). The FLRA held that the terms of Section 2 are not
contrary to law, and therefore ordered DHS to rescind its
disapproval of the provision. Id. at 900. The Authority
declined to follow the Fourth Circuit’s decision in NRC.
FLRA Decision, 66 F.L.R.A. at 894. Instead, the Authority’s
decision rested principally on its interpretation of the Supreme
Court’s decision in NASA v. FLRA (NASA), 527 U.S. 229(1999). FLRA Decision, 66 F.L.R.A. at 895-96.
NASA holds that, because an OIG investigator is a
“representative of the agency” in certain circumstances, an
employee may seek union representation during an OIG-
conducted interview pursuant to the so-called “Weingarten
rights” embodied in 5 U.S.C. § 7114(a)(2)(B). 527 U.S. at
246. This section of the FSLMRS was patterned after the
decision in NLRB v. J. Weingarten, Inc., 420 U.S. 251 (1975)
(upholding a National Labor Relations Board decision that an
employer’s denial of an employee’s request to have a union
representative present at an investigatory interview, which the
employee reasonably believed might result in disciplinary
action, was an unfair labor practice under the National Labor
Relations Act).
The statutory Weingarten rights provide:
(2) An exclusive representative of an appropriate unit in
an agency shall be given the opportunity to be
represented at-- . . .
(B) any examination of an employee in the unit by a
representative of the agency in connection with an
investigation if-- (i) the employee reasonably believes
that the examination may result in disciplinary action
against the employee; and (ii) the employee requests
representation.
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5 U.S.C. § 7114(a)(2)(B). The Authority acknowledged “that
the statutory provision involved in NASA was § 7114(a)(2)(B)
of the Statute, which is not at issue here.” FLRA Decision, 66
F.L.R.A. at 895. The Authority “also acknowledge[d] that the
Supreme Court did not resolve whether it would conflict with
the IG Act to require bargaining over IG-investigation
procedures.” Id. Nonetheless, it held that “one of the primary
purposes that Congress had in enacting the [FSLMRS] was to
protect the right to bargain collectively,” and this includes the
right to bargain over the implementation of Weingarten rights.
Id. at 896. We disagree.
The OIG is an independent entity. Although it is situated
within an agency, it is excluded from the collective bargaining
requirements of the FSLMRS. See U.S. Dep’t of Justice v.
FLRA, 39 F.3d 361, 365 & n.5 (D.C. Cir. 1994) (holding that
section 7112(b)(7) “forbids the formation of bargaining units
containing employees primarily engaged in investigating
other agency employees to ensure they are acting honestly—
an apt description of investigators working for the Inspector
General”). Furthermore, proposals concerning Inspector
General-investigation procedures are not “appropriately the
subject of bargaining,” because to allow such bargaining
“would impinge on the statutory independence of the IG.”
NRC, 25 F.3d at 234. “[I]f we were to interpret the FSLMRS
to require [an agency] to bargain over rights and procedures
for investigatory interviews conducted by the Inspector
General, we would indirectly be authorizing the parties to
collective bargaining to compromise, limit, and interfere with
the independent status of the Inspector General under the [IG
Act].” Id. at 235.
Because we conclude that the proposal in Section 2
advanced by NTEU here would compromise the
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independence of the OIG and would be “inconsistent” with
the IG Act within the meaning of 5 U.S.C. § 7117(a)(1), we
grant DHS’s petition for review.
****
Normally, “the court’s role in reviewing the FLRA’s
negotiability determinations is narrow.” Am. Fed’n of Gov’t
Emps. v. FLRA, 866 F.2d 1443, 1446 (D.C. Cir. 1989). Thus,
in a typical case of this sort, we “will only reverse a
negotiability finding of the Authority when the finding is not
supported by substantial evidence, is inconsistent with the
governing statute, represents an unexplained departure from
prior agency determinations, or is otherwise arbitrary or
capricious or not in accordance with the law.” Id.In this case, however, the FLRA’s order was based on its
conclusion that NTEU’s bargaining proposal was not
inconsistent with other federal law. In particular, the
Authority determined that NTEU’s proposed Section 2 was
not inconsistent with the IG Act as it interpreted that Act. The
FLRA, however, has no special competence in the
interpretation of the IG Act, so we accord no deference to its
interpretation of that statute. See, e.g., IRS v. FLRA, 902 F.2d
998, 1000 (D.C. Cir. 1990); Office of Pers. Mgmt. v. FLRA,
864 F.2d 165, 171 (D.C. Cir. 1988). Therefore, we review de
novo the Authority’s decision insofar as it purports to
construe the requirements of the IG Act. NRC, 25 F.3d at 232-
33.
****
The FLRA’s decision in this case rests on two critical
contentions: First, the Authority argues that it “properly
concluded that [DHS’s] claim was negated by the Supreme
8
Court’s (post-NRC) holding in NASA . . . that IG
independence already is constrained by employees’
Weingarten right under the Statute.” Br. for Resp’t at 10.
Second, the Authority argues that NTEU’s proposed Section 2
is not inconsistent with the IG Act in purporting to regulate
OIG investigation procedures. Id. at 10-11. We disagree with
both points for the reasons explained below.
Before we address the principal issues in this case,
however, we must first dispose of the Authority’s argument
that a number of claims raised by DHS are not properly
before the court.
1. Waiver
The Authority asserts that DHS waived a number of
claims that they have presented to the court by failing to
properly raise them in the first instance with the FLRA as
required by § 7123(c) of the FSLMRS. According to the
FLRA, “[DHS’s] submissions to the Authority did not
identify, much less discuss, any section of the IG Act besides
§ 6(a)(2).” Br. for Resp’t at 23. The FLRA thus contends that
this court is barred from considering, inter alia, whether
sections of the IG Act other than section 6(a)(2) are
incompatible with the collective bargaining requirements of
the FSLMRS; whether the 2008 amendments to the IG Act
and the legislative history of those amendments reinforce and
strengthen the OIG’s independence; and whether 5 U.S.C.
§ 7112(b)(7) excludes the OIG from engaging in collective
bargaining or being bound by the terms of collective
bargaining between the union and the agency. We find no
merit in FLRA’s waiver argument.
DHS’s position before this court that neither CBP nor any
other agency within DHS has authority to bargain on behalf of
9
the OIG is surely encompassed within the DHS’s statement of
the “issue” before the FLRA, which was “whether the
[agency] and the [union] may negotiate the specific
procedures to be followed by the DHS OIG when performing
its auditing and investigating functions.” DHS Statement of
Position on NTEU Petition for Review of Negotiability
Issues, reprinted in J.A. 39. In addition, DHS’s argument
below was that the OIG is not a representative of the agency
for purposes of collective bargaining, id. at J.A. 41, and that
the OIG more generally cannot be bound by terms negotiated
by union and agency officials because such interference with
the OIG’s “independent status” would be “inconsistent with
the IG Act,” id. at J.A. 40; see also Br. for Pet’r at 33. The
FLRA obviously understood DHS’s position because it
acknowledges that it “examined the Statute for indications
that Congress intended to completely preclude collective
bargaining over all IG-investigation procedures” and “found
none.” Br. for Resp’t at 17.
In its brief to this court, DHS points out that, before the
Authority, it “cited NRC ‘as a case directly on point’ and
relied on it extensively. The Authority therefore knew that the
agency’s argument was that bargaining over [Section 2] was
incompatible with the IG Act as a whole, and it also knew
that that argument depended on the numerous provisions of
the IG Act discussed in NRC. Indeed, the fact that the
Authority rejected NRC as persuasive authority means the
Authority was fully aware of the NRC analysis.” Reply Br. for
Pet’r at 13 (citations and footnote omitted). We agree.
It is evident from the record in this case that, even though
DHS did not itself cite every relevant provision in the IG Act
in the proceedings below, the agency’s principal argument
was that the accumulated provisions of the IG Act were
inconsistent with collective bargaining over OIG procedures.
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This point could not have been lost on the FLRA because it
was the thrust of the NRC decision. Therefore, the Authority
reasonably should have understood the full extent of DHS’s
argument. See NetworkIP, LLC v. FCC, 548 F.3d 116, 122
(D.C. Cir. 2008) (explaining that an issue “need not be raised
explicitly; it is sufficient if the issue was ‘necessarily
implicated’ in agency proceedings”). We therefore hold that
DHS did not waive any of the claims that it has presented to
this court.
2. The Supreme Court’s Decision in NASA v. FLRA
In NASA, the Supreme Court held that Ҥ 7114(a)(2)(B)
is not limited to agency investigators representing an ‘entity’
that collectively bargains with the employee’s union.” 527
U.S. at 237. In other words, the Court made it clear that even
though the OIG does not engage in collective bargaining
under the FSLMRS, OIG investigators who work for an
agency such as DHS can be “representatives of the agency”
under § 7114(a)(2)(B). Because “an OIG’s investigative
office, as contemplated by the [IG Act], is performed with
regard to, and on behalf of, the particular agency in which it is
stationed . . . the investigators employed in [the agency’s]
OIG are unquestionably ‘representatives’ of [the agency]
when acting within the scope of their employment.” Id. at
240.
The Court in NASA further explained that:
[T]he right Congress created in § 7114(a)(2)(B)
vindicates obvious countervailing federal policies. It
provides a procedural safeguard for employees who are
under investigation by their agency, and the mere
existence of the right can only strengthen the morale of
the federal workforce. The interest in fair treatment for
11
employees under investigation is equally strong whether
they are being questioned by employees in [the agency’s]
OIG or by other representatives of the agency.
Id. at 244-45. The Court’s holding is no more surprising than
would be a decision that OIG investigators are subject to
proscriptions against employment discrimination based on
race or sex. Id. at 240 n.4. The Weingarten right embodied in
§ 7114(a)(2)(B) is an overriding federal protection that takes
precedence over the right to engage in collective bargaining
under the FSLMRS and the OIG’s authority to pursue
investigations under the IG Act. Unions and federal
employers cannot negotiate a collective bargaining agreement
that diminishes the rights afforded by § 7114(a)(2)(B), and
OIG investigators cannot deny federal employees their
Weingarten rights during the course of OIG investigations.
In our view, the Supreme Court’s decision in NASA does
not justify the Authority’s position in this case. The Authority
has essentially conceded this. FLRA Decision, 66 F.L.R.A. at
895. Indeed, the Authority has acknowledged “that the
Supreme Court did not resolve whether it would conflict with
the IG Act to require bargaining over IG-investigation
procedures.” Id. The Court in NASA found it unnecessary to
“consider whether the outer limits of the Authority’s
interpretation [of § 7114(a)(2)(B)] so obstruct the
performance of an OIG’s statutory responsibilities that the
right must be more confined.” 527 U.S. at 244. It is
noteworthy, however, that the Court cited the Fourth Circuit’s
decision in NRC to highlight the “OIG’s concerns that the
reach of § 7114(a)(2)(B) will become the subject of collective
bargaining between agencies and unions.” Id. at 244 n.8. If
the FLRA’s decision in this case were upheld, the concerns
noted in NASA would be realized.
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DHS makes the telling point that the Supreme Court’s
decision in NASA does not in any way suggest that the OIG is
the representative of an agency for collective bargaining
purposes under the FSLMRS:
NASA did not hold that the OIG is a “representative of
the agency” for all purposes and, indeed, specifically
said its decision was limited to the Weingarten right itself
and no more. NASA found a specific textual basis for
holding that an OIG is “a representative of the agency”
for purposes of Section 7114(a)(2)(B), but no textual
source exists for extending representative status to
collective bargaining or the results of such bargaining.
Br. for Pet’r at 9. We agree.
The holding in NASA is limited to the right of a union
representative to attend an employee examination as specified
in § 7114(a)(2)(B), which is only if “(i) the employee
reasonably believes that the examination may result in
disciplinary action against the employee; and (ii) the
employee requests representation.” Section 7114(a)(2)(B)
says nothing about the matters covered by the NTEU’s
proposal in Section 2, such as “the extent to which a union
representative may participate in the examination (by raising
objections or asking for breaks in the examination to discuss
questions with the employee), whether the union or the
employee is entitled to notice of the examination, what type
of notice is required, whether the employee is entitled to
warnings, or what such warnings might say.” Br. for Pet’r at
15. And the Court’s decision in NASA certainly does not
suggest that OIG investigations can be regulated in any of
these ways pursuant to the terms of a collective bargaining
agreement.
13
In sum, we reject the Authority’s interpretation of the
NASA decision. The Court’s decision in that case simply
cannot be stretched to support the Authority’s decision here.
3. Proposals to Regulate OIG Investigations
Authorized by the IG Act Are Not Proper Subjects
of Collective Bargaining Under the FSLMRS
The OIG is not subject to collective bargaining under the
FSLMRS. See NRC, 25 F.3d at 235; U.S. Dep’t of Justice v.
FLRA, 39 F.3d at 365 & n.5. The Authority does not dispute
this. Therefore, “[h]aving excluded employees of the Office
of Inspector General from any collective bargaining, Congress
surely could not have intended that other employees in an
agency be given the right to negotiate the conditions of work
for Inspector General employees.” NRC, 25 F.3d at 235. OIG
inspectors are obliged to respect an employee’s Weingarten
rights as required by § 7114(a)(2)(B). But public sector
unions and agencies can neither add to nor subtract from the
OIG’s investigatory authority through collective bargaining.
Furthermore, the FSLMRS exempts from its negotiation
requirements any provisions that are “inconsistent with any
Federal law or any Government-wide rule or regulation.” 5
U.S.C. § 7117(a)(1). It cannot be disputed that the intended
reach of NTEU’s proposed Section 2 is much broader than the
Weingarten rights embodied in § 7114(a)(2)(B). Therefore,
Section 2 impermissibly interferes with the OIG in two ways:
first, it requires more of OIG inspectors than Weingarten itself
requires; second, it purports to impose contractual obligations
on the OIG even though the OIG is not a party to the
collective bargaining agreement and is not subject to the
bargaining requirements of the FSLMRS.
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Section 2 would require employee investigations to be
conducted as the Union would prefer, not as an OIG
investigator might think best depending upon the
circumstances of the case. This is inconsistent with the OIG’s
authority under the IG Act to serve as an “independent and
objective” unit, “to conduct and supervise audits and
investigations relating to [certain] programs and
operations . . . [and] provide leadership and coordination and
recommend policies for activities designed (A) to promote
economy, efficiency, and effectiveness in the administration
of, and (B) to prevent and detect fraud and abuse in, such
programs and operations.” 5 U.S.C. app. 3 § 2.
The important point, however, “is not that particular
negotiated procedures interfere with specific aspects of OIG
authority under the Inspector General Act but, rather, that
negotiation in and of itself is antithetical to OIG independence
established by the Inspector General Act.” Br. for Pet’r at 30.
Under the IG Act, Inspectors General are “appointed by the
President” with “the advice and consent of the Senate, without
regard to political affiliation and solely on the basis of
integrity and demonstrated ability in accounting, auditing,
financial analysis, law, management analysis, public
administration, or investigations.” 5 U.S.C. app. 3 § 3(a). The
IG Act also forbids the OIG from having any “program
operating responsibilities.” Id. § 9(a). The OIG has power to
select and employ whatever personnel are necessary to
conduct its business, to employ experts and consultants, and
to enter into contracts for audits, studies, and other necessary
services. Id. §§ 3(d), 6(a). And other than the “general
supervision” of the agency head and one deputy, an OIG
“shall not report to, or be subject to supervision by, any other
officer of such [agency].” Id. § 3(a).
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In NRC, the Fourth Circuit further explained the OIG’s
investigatory authority under the IG Act:
[S]hielded with independence from agency interference,
the Inspector General in each agency is entrusted with
the responsibility of auditing and investigating the
agency, a function which may be exercised in the
judgment of the Inspector General as each deems it
“necessary or desirable.” 5 U.S.C. App. 3 § 6(a)(2). To
facilitate that function, the Act gives to each Inspector
General access to the agency’s documents and agency
personnel. The Inspector General may issue subpoenas,
administer oaths, and investigate complaints and
information from any employee of the agency
“concerning the possible existence of an activity
constituting a violation of law, rules, or regulations, or
mismanagement, gross waste of funds, abuse of authority
or a substantial and specific danger to the public health
and safety.” 5 U.S.C. App. 3 § 7(a).
NRC, 25 F.3d at 234.
In light of the foregoing, we agree with the judgment of
the Fourth Circuit in NRC. Because we cannot say it better,
we adopt the reasoning of our sister circuit:
[P]roposals which concern investigations conducted by
the Inspector General, such as those at issue here, are not
appropriately the subject of bargaining between an
agency and a union. Such proposals run afoul of the
Inspector General Act’s mandate that it is the Inspector
General who has the authority to “conduct, supervise,
and coordinate audits and investigations” relating to the
[agency]. Congress intended that the Inspector General’s
investigatory authority include the power to determine
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when and how to investigate. To allow the [agency] and
the Union, which represents the [agency’s] employees, to
bargain over restrictions that would apply in the course
of the Inspector General’s investigatory interviews in the
agency would impinge on the statutory independence of
the Inspector General. . . . [Proposals] establishing
employee rights and procedures for conducting
investigatory interviews are therefore inconsistent with
the Inspector General’s independence and the Inspector
General Act.
NRC, 25 F.3d at 234. We also agree with the Fourth Circuit
that, in reaching this conclusion, “we do not limit the right of
the [agency] and the Union to negotiate employee rights and
procedures for any investigations that may be conducted by
other employees of the [agency], who are not from the Office
of the Inspector General.” Id.CONCLUSION
For the reasons discussed above, we hereby reverse the
decision of the Authority and grant DHS’s petition for review.
So ordered.