Introduction (February 1996)
In this bulletin we summarize a substantial portion of the labor relations case law on performance management in the hope that it will be of assistance to agency officials in their dealings with labor organizations when implementing recent changes in OPM's Governmentwide regulations on performance management. See, in this connection, Part V of the Federal Register of August 23, 1995 -- pp. 43936 through 43948 -- for OPM's final regulations.
In publishing its new regulations on performance management, OPM stated that "the success of a performance management system in achieving its goals is dependent upon acceptance by the management and employees who use it. There is no better way to garner support for a system than by giving all stakeholders a role in developing it." Further, the National Performance Review stated in its accompanying report, Reinventing Human Resource Management, that under the ideal performance management system "[e]mployees and their representatives will be involved in design and implementation of performance management programs and in development of performance expectations." Therefore, OPM strongly advises agencies that the regulatory changes in performance management should be implemented through full partnership with employees and their union representatives.
Employees and their union representatives should be involved in all aspects of development of performance management systems and programs, without regard to negotiability questions. Nevertheless, we recognize that there will be times when all of the stakeholders cannot agree on a matter pertaining to performance management and the negotiability of the matter will become an issue. It is our hope that this guide will be of assistance to agency and union officials when such occasions arise.
Before proceeding to the main body of this bulletin, we here give the reader a bird's eye view of the major patterns that we have found.
- The identification of performance elements (be they critical or noncritical) and the number of performance elements are nonnegotiable (NN) because reserved to management by management's § 7106(a)(2)(A) and (B) rights to direct employees and assign work.
- The number of rating levels for each element, as well as the number of rating levels for the summary rating, are nonnegotiable. For example, the decision to adopt a " pass-fail" system is reserved to management by its rights to direct employees and assign work.
- The establishment of performance standards, including the criteria they must comply with are, with a few exceptions, NN because protected by the rights to direct employees and assign work.
Criteria that are required by law are negotiable because § 7106(a)(2) rights must be exercised "in accordance with applicable laws."
Criteria that don't have the effect of prescribing (or proscribing) certain kinds of performance standards are negotiable. For example, a requirement that performance standards be consistent with position descriptions is negotiable because management "could always achieve consistency . . . by amending the position description."
Criteria for the APPLICATION of performance standards are negotiable. For example, while a requirement that the performance standards themselves be "fair and equitable" is NN, a requirement that the standards be applied in a "fair and equitable" manner is negotiable.
Requiring management to "take into account" or "make allowances for" various matters in establishing performance standards are nonnegotiable.
However, such proposals may be negotiable § 7106(b)(3) "appropriate arrangements" if they are directed to the application of performance standards.
Requiring that management "consider" certain matters in establishing performance standards is negotiable because an obligation to consider (but not necessarily adopt) sundry matters does not interfere with management's rights.
Proposals allowing disputes over unapplied performance standards to be grieved are negotiable.
- Restrictions on sampling methods, monitoring techniques, and data that may be used in evaluating performance normally are NN where they have the effect of determining the content of performance standards.
Whether proposals postponing appraisal of performance when an employee is assigned new duties are negotiable appears to depend on whether the postponement is brief or lengthy. Where they are brief, FLRA would probably find the proposal a negotiable appropriate arrangement because it does not "excessively interfere" with the right to appraise performance.
- Proposals prescribing the frequency with which appraisals are to be given, as well as the duration of the appraisal cycle, are negotiable § 7106(b)(2) "procedures" if they do not prevent management from taking performance-based actions at any time. Page 20.
- Although unions have a § 7114(b)(4) statutory right to certain types of information, proposals requiring information beyond the statutory minimums are negotiable if they are otherwise consistent with law. However, recent case law on disclosure of information involving an employee's Privacy Act rights indicates that neither the Freedom of Information Act (FOIA) nor the "routine use" exceptions to the Privacy Act will permit, absent employee consent, disclosure of performance ratings containing personal identifiers.
Apart from Privacy Act issues, proposals requiring the agency to maintain various types of information and to provide it to employees are generally negotiable.
- Proposals providing for employee and union participation in the development of performance standards generally are negotiable, provided that such participation does not give them authority to establish or veto the establishment of performance elements, levels, or standards or otherwise interfere with rights reserved to management.
Distinguish between joint labor-management committees that make non-binding recommendations on how management should exercise its reserved rights and management-established committees that are part of management's decision-making process. Proposals establishing the former are negotiable, whereas proposals requiring union involvement in the latter are nonnegotiable.
- Higher level review associated with the exercise of a management right is part of management's internal deliberations. Therefore, any attempt to impose or prohibit higher level review with respect to the exercise of a management right (e.g., requiring or prohibiting higher level review of performance plans or performance ratings) interferes with management's rights to direct employees and assign work. However, if the interference isn't excessive, the proposal--if "tailored" to adversely affected employees--might constitute a negotiable "appropriate arrangement."
- Proposals mandating performance awards--other than QSIs (see 11 below)--for certain levels of performance and prescribing the amount (e.g., a percentage of one's base pay) were, until OPM's new regulations became effective, nonnegotiable because in conflict with those regulations. However, such proposals will probably be [are--see 52 FLRA No. 117] negotiable under OPM's new regulations.
- Proposals prescribing RIF length-of-service credits for various levels of performance are nonnegotiable if they are inconsistent with OPM's RIF regulations.
- Proposals mandating QSIs for performance are nonnegotiable, not because they interfere with management's rights (case law to date has failed to find a management right that encompasses a right to reward), but because they would be inconsistent with OPM's regulations. OPM's new regulations, like its old regulations, permit but do not mandate the granting of QSIs for the highest rating of record that can be achieved.
- Proposals adding to the statutory procedural requirements for performance-based actions are nonnegotiable. Proposals requiring that performance-based disciplinary actions be "progressive" (e.g., requiring that an employee's whose performance is unacceptable be reassigned before demoted and demoted before removed) excessively interfere with the right to discipline.
- Performance standards, ratings, and awards apply only to the performance of agency-assigned duties. They may not encompass duties and responsibilities performed on official time on behalf of a labor organization. "Presumed" or "assumed" or "carry over" ratings of record are prohibited. However, requiring that performance standards established for employees serving as union representatives be modified so as to accommodate their use of official time is a negotiable "appropriate arrangement." Moreover, it is the position of FLRA's General Counsel that employees cannot be evaluated, disciplined, or rewarded for activities undertaken in their capacity as union representatives performing representational functions.
In order to conserve space, we do not identify the litigants when citing FLRA's decisions. We instead use an abbreviated notation consisting of a number followed by F followed by another number, in which the first number refers to the volume number of FLRA's decisions, and the second number to the decision number. Thus, 29 F 50, #8, §4A refers to section 4A of proposal number 8 of 29 FLRA No. 50, and 42 F 88, #1 refers to proposal number 1 in 42 FLRA No. 88. Negotiable proposals are in italics to visually set them off from nonnegotiable proposals.
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Performance Elements
- Negotiating the identity of performance elements.Proposals requiring that performance elements be negotiated, or which have the effect of determining performance elements by, e.g., mandating or barring the use of certain elements under specified circumstances, or prescribing or limiting the number of elements that can be evaluated, are all nonnegotiable. Examples of such proposals that FLRA has found nonnegotiable are as follows:
Non-critical elements. 13 F 49: requiring the negotiation of non-critical elements is NN. "[T]he identification of any job element, whether critical or otherwise, constitutes an assignment of duties within the meaning of the right to assign work. In addition, the determination of the relative importance of job elements sets priorities for the accomplishment of the agency's work and, therefore, constitutes an exercise of its right to direct employees." See, also, 13 F 77, #6 (requiring that each job have some non-critical elements is NN). "[T]he identification of job elements, if any, which are not critical is also an exercise of management's rights to direct work and assign employees."
Same elements for same positions, assignments, PDs. 16 F 114, #2 (requiring that certain kinds of positions have the same critical elements is NN); 29 F 50, #8, §2 (requiring that employees on like assignments be rated on like elements is NN); 15 F 5, #2 (requiring that employees in essentially the same positions have the same critical elements is NN); 13 F 77, #3 (requiring that employees with the same PD under the same supervisor have the same critical elements is NN); 6 F 5 (requiring that employees with the same position descriptions have the same elements and standards is NN).
Consistency with position descriptions. Requiring that elements and standards be consistent with position descriptions is negotiable. Such a requirement does not restrict management's ability to identify elements because management can always change the position descriptions. See, e.g., 7 F 88, #1; 11 F 103, #2; and 25 F 90, #4. See, also, 24 F 17, #5 (prohibiting the evaluation of duties that are not within position description is negotiable: management can always add the duties to the PD).
Elements that are job-related and measurable. 29 F 50, #8, § 1, affirmed by the 8th Circuit in AFGE 3748 v. FLRA, 797 F.2d 612 (1986): FLRA held that a requirement that rating elements be job-related, accurate, measurable, and not subjective is NN because it has the effect of permitting arbitral review of management's determinations regarding the content of performance standards. The court, in turn, held that the provision was so broad as to encompass the content of performance standards, and thus was outside management's statutory duty to bargain.
Elements for grade-controlling factors only. 5 F 14, #1: limiting critical elements to the grade-controlling factors of the position is NN--affirmed by the D.C. Circuit in AFGE Local 1968 v. FLRA, No. 81-1274 (D.C. Cir. 10/12/82), where the court said that the proposal "would sanction direct challenges to performance standards and critical job elements, and would allow arbitrators to substitute their notions of proper standards and elements for those of management.") See, also, 7 F 34, #1, 7 F 137, 9 F
Although negotiable, it may not be advisable for agencies to agree to such a requirement. Keep in mind that position descriptions are primarily used to classify a position, not to derive performance requirements. Under OPM's new performance regulations, there is no requirement that performance elements and standards be based on position descriptions.
Apart from negotiability, the proposal limiting critical elements to grade-controlling factors misconceives the role of critical elements. Performance requirements must contain at least one critical element because performance-based actions can only be taken where the individual's performance on a critical element is unsatisfactory. Although it is only natural that the most important parts of a person's job be designated as critical elements so that the agency can take action for unacceptable performance of important tasks, it is nonetheless possible for non-critical elements to be more important for other purposes, such as 86, #1, and 13 F 80. Compare with 47 F 2, #8 (where FLRA found negotiable a requirement that critical elements be based on job functions so important that removal of the employee for unacceptable performance would be warranted: the requirement isn't inconsistent with 5 CFR 430.203).
Prohibited elements. 49 F 29, #2 (barring use of performance elements affected by deficit reduction plans is NN); 25 F 1, #4 (barring use of collateral duties as critical elements is NN); 13 F 77, #7 (barring use of quantifiable critical elements for professional employees is NN).
Number of elements. 7 F 17: (allowing no more than 5 critical elements for each position is NN). See, also, 13 F 77, #4.
- Negotiating the number of rating levels.The number of rating levels for each element (as well as the number of rating levels for the summary rating) is NN. See, e.g., 13 F 96 where FLRA found NN a proposal requiring 5 levels for each element and 3 levels for the summary rating. In 38 F 46, #5, where FLRA relied on 13 F 96, the Authority said the following in finding NN a proposal establishing the number of rating levels and the quality of performance required at each level:
[A]n essential aspect of management's assignment of work and the supervision and guidance of employees in the performance of their work is the establishment of job requirements for various levels of performance so as to elicit the quality and amount of work from employees necessary to effectively and efficiently fulfill the agency's mission and functions. Consequently, a proposal that would establish the particular levels of performance in individual job elements required to achieve a particular summary rating for overall performance directly interferes with management's rights to direct employees and assign work. Department of Justice, 13 FLRA at 580. Additionally, the determination of the number of performance levels directly affects the degree of precision with which management can establish and communicate job requirements and the range of judgments that management can make regarding performance. In short, the number of such levels is integrally related to the effectiveness of an agency's using performance standards to accomplish the work of the agency in a manner consistent with the exigencies of effective government. Id. at 580-81.
Even if Proposal 5 largely mirrors an Agency proposal or established practice, such fact does not render negotiable a proposal that is nonnegotiable under section 7106(a). See, for example, . . . 32 FLRA 944, 947 (1988) (VAMC, Providence) (proposals that are nonnegotiable under section 7106(a) do not become negotiable based on management actions). [FLRA went on to note that the union never contended that the proposal was an appropriate arrangement.]
See, also: 13 F 112, #3 (4 levels); 14 F 2 (2 levels); 14 F 74 (3 levels); 14 F 75 (3 overall levels); 16 F 36; 16 F 43; 16 F 114, #3; 20 F 26, #2; 21 F 123, #6; 22 F 47; 25 F 29, 11B (4 levels); 26 F 12, #2, 29 F 41, #4; and 35 F 61, #5.
These cases are particularly important, given that OPM's new performance regulations permit agencies to use as few as two levels in appraising elements and/or overall performance, and where there is no requirement that the number of levels for all the elements be the same and that the number of levels for the summary rating be the same as for the elements. Under current case law, all these determinations are reserved to management.
It should also be noted that while OPM's new Governmentwide regulations, to the extent they are inconsistent with existing performance plan provisions in collective bargaining agreements, do not become effective until those agreement provisions can be reopened and renegotiated (see 5 U.S.C. § 7116(a)(7)), management does not have to wait until the agreement can be reopened in order to change the number of performance levels for elements and overall performance because such decisions are protected by management's § 7106 rights. There is, of course, a duty to give affected unions adequate notice of these decisions, an opportunity to bargain on their impact and implementation, and a requirement to maintain the status quo if the services of the Impasses Panel are timely invoked and management cannot establish that implementing the proposed changes "is consistent with the necessary functioning of the agency." See 18 F 61.
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Performance Standards
- Mandating a bilateral decision-making process. A requirement that performance standards be negotiated, or established by a "panel of experts" or a joint committee, as in 6 F 5, is nonnegotiable. See, e.g., 3 F 120, 5 F 14, #3--affirmed by the D.C. Circuit in AFGE Local 1968 v. FLRA, No. 81-1274 (D.C. Cir. 10/12/82),; 5 F 70; 7 F 34, #4, 2nd paragraph (requiring "bargaining to impasse with the union as an equal partner concerning the particular performance standards to be established" is NN); 7 F 80; 7 F 88, ##1 & 4; 7 F 137, #2, 2nd para; 9 F 86, #4; 9 F 122; 13 F 49, #2 (requiring negotiation of standards for non-critical elements); 14 F 2; 23 F 43, #2 (requiring that subjective terms, such as "courtesy," be negotiated is NN); 28 F 81, #3. Similarly, requiring that any change in the standards be negotiated is NN: see 25 F 21, #16. However, § 7106(b)(2) procedures that management will follow in establishing standards are negotiable, such as proposals barring secret studies and/or requiring that studies be conducted on typical workers under normal working conditions. See, e.g., 23 F 43, #3; 15 F 1, #1; 13 F 80; 7 F 137, #2, 1st para; 7 F 34, #4, 1st paragraph.
- Proposals establishing performance standards are nonnegotiable. See, e.g., 27 F 79, #7, § 4, 1st sentence (establishing "marginal" and "unsatisfactory" rating categories and prescribing numerical scores to correspond to those ratings is NN); 28 F 89, #4c (definition of error that excludes certain data is NN); 28 F 89, ## 7 - 9 (requiring that decisions on error be "fair and consistent" is NN because it has the effect of determining the content of performance standards); 25 F 29, §1F (definition of a term in a standard that has the effect of precluding management from evaluating other qualitative aspects of performance is NN); 25 F 29, #11D (what constitutes an "error" is NN); 25 F 2, #2 (defining "payment deficiency" is NN); 17 F 95, #3 (prescribing the degree of unacceptability assignable to a particular type of error is NN); 15 F 172, "Definition of Errors" (proposals defining errors are NN); 14 F 64, #5 (establishing certain quantitative and qualitative standards is NN), 13 F 50 (prescribing the content of the standards for determining the attainment of a particular level of performance is NN); and 11 F 58 (proposal establishing a specific level of output that the agency must accept as satisfactory is NN).
- Performance standards criteria. It has been more common, however, for proposals to prescribe criteria or requirements that management will adhere to or comply with when management establishes or adjusts performance standards. Such proposals normally are nonnegotiable. See, in this connection, NTEU v. FLRA, 767 F.2d 1315 (9th Cir. 1985), where the court affirmed FLRA's decision in 7 F 115 that certain performance standard criteria were nonnegotiable. The court said, among other things, that "to specify any criterion, however reasonable, is to invade management's exclusive statutory preserve[,]" and that negotiated criteria would "invite . . . second-guessing by an arbitrator in areas reserved, by statute, for exclusive managerial discretion."
Although proposals prescribing (or proscribing) performance standard criteria normally are nonnegotiable, there are a few exceptions.
Criteria required by law. Where, for example, the criteria are also required by law, they do not interfere with management rights because those rights have to be exercised in accordance with applicable laws. See, e.g., 47 F 2, #12 (requiring that standards be objective and job-related to the maximum extent feasible is negotiable), where FLRA said that "Provision 12 incorporates into the parties' agreement the requirement in 5 U.S.C. § 4302(b)(1) that performance standards permit evaluations based on objective criteria to the maximum feasible extent." The provision thus merely requires the agency to exercise its rights subject to "applicable laws." See, also, 44 F 93, #3 (standards must be objective to maximum extent feasible is negotiable because "maximum extent feasible" incorporates the requirement of 5 USC § 4303(b)(1)) and 32 F 85, #3 (requiring that standards be written in a way that will permit accurate evaluation of performance is negotiable because it reflects the statutory requirements of 5 U.S.C. § 4302(b)(1), isn't more restrictive than law, and doesn't establish a separate contractual limitation on management's determination of the content of performance standards: "Although law or regulation may limit the exercise of management's rights, the Statute prohibits the negotiation of contractual limitations on management rights.")
Objective standards. Requiring that the standards be "objective" (rather than objective to the maximum extent feasible), by contrast, would be nonnegotiable, as was held in 42 F 69, #3, 1st sentence, and #7; 39 F 25, #2; and 20 F 55. Indeed, any attempt to eliminate the use of "subjective" standards is NN. See, e.g., 29 F 50, #8, §1 (requiring that rating elements be job-related, accurate, measurable and that abstract subjective elements not be used is NN--affirmed by the 8th Circuit in AFGE 3748 v. FLRA, 797 F.2d 612 (1986). See, also, 13 F 77, #5 (exempting positions for which objective standards aren't possible from appraisal system is NN).
Standards consistent with position descriptions. Another criterion found negotiable is a requirement that performance standards be consistent with position descriptions. See, in this connection: 47 F 2, #7, 1st part of 2nd sentence; 46 F 67, ##20 & 21, para. # 1; 42 F 69, #5, subsection 3; 13 F 77, #2; 9 F 86, #2; 7 F 34, #2; and 7 F 88 where FLRA said that "this proposal, by requiring consistency between position descriptions . . . and critical elements . . . would not limit the Agency's choice of critical elements or performance standards. Rather, the Agency could always achieve consistency as required by the proposal merely by amending the position description."
But the above are exceptions to the rule that performance standards criteria or requirements are nonnegotiable. Here are some examples of nonnegotiable requirements:
Standards that are fair, equitable, realistic, etc. Requiring that the standards be "fair" or "equitable"--as in 38 F 46, #3; 34 F 170, #1; 29 F 116, #2; 28 F 89, ##1 & 2; 25 F 2, #3C; 22 F 60; 20 F 55--affirmed by the 8th Circuit in AFGE Local 3365 v. FLRA, No. 85-2473 (8th Cir. 7/23/86); 17 F 109, #3; and 16 F 127, #3--is nonnegotiable. Such a requirement would impermissibly enable an arbitrator to substitute his judgment in an area reserved to management for that of management (instead of falling within the arbitrator's discretion to determine whether they are in conformance with law and regulation). See, also 46 F 67, #21. Fair application of standards. Although a requirement that performance standards themselves be "fair" and "equitable" is nonnegotiable because it deals with the content of performance standards, FLRA has found requirements that standards be applied "fairly" and "equitably" are negotiable 7106(b)(3) appropriate arrangements.
See, also: 47 F 79, #2 (requiring that performance standards and elements, "as they are applied to an employee, will be fair and based upon objective criteria and job-relatedness[,]" is negotiable); 46 F 67, #22 (requiring that management fairly evaluate performance. FLRA distinguished between a requirement that a performance standard be "fair and equitable" (nonnegotiable because it deals with the content of the performance standard) and a requirement that they be applied fairly and equitably). Regarding 46 F 67, #22, it found that it "concerns the application of performance standards .
This was before FLRA's view of "appropriate arrangements was broadened considerably by the D.C. Circuit to include some proposals that directly interfered with management's rights and FLRA's subsequent adoption of an "excessive interference" balancing test. For FLRA's earlier "appropriate arrangement" rationale, see, e.g., 3 F 120, #5, where FLRA said the following: [I]nsofar as [a] proposal . . . merely would establish a general, nonquantitative requirement by which the application of critical elements and performance standards established by management may subsequently be evaluated in a grievance by an employee who believes that he has been adversely affected by the application of management's performance standard to him, . . . it is within the duty to bargain. . . . [R]eview by an arbitrator would not . . . preclude the agency from initially determining the content of the standard, nor would it result in the substitution of the arbitrator's judgment for that of the Agency and the setting of a new standard; it would simply determine if the standard established by management as applied to the grievant complied with the "fair and equitable . . ."requirements of the parties' agreement. . . Nothing in the plain wording of Provision 22 . . . addresses the content of the performance standards established by management"); and 17 F 108, #1 (requiring that performance standards be applied in a fair and equitable manner...proposal is like 7 F 34, #2 (a general, nonquantitative requirement regarding the application of standards) and unlike 16 F 127, #3 (where the proposal "is not limited to establishing a general nonquantitative requirement by which the application of performance standards established by agency management could subsequently be evaluated in a grievance" (emphasis by FLRA)).
Reasonably attainable standards. 47 F 2, #45, 2nd sentence (a requirement that minimum standards to avoid disciplinary action must be reasonably attainable is NN because it excessively interferes with management's rights). See, also, 46 F 108, #2 (requirement that standards be reasonably attainable is NN).
Standards consistent with grade. 46 F 67, #21, paragraph (2) and 42 F 69, #5 (requirement that standards be consistent with grade is NN).
Standards a function of time spent on tasks. 28 F 89, #14 (requiring different standards for employees who spend less than 45% of time on regular work is NN).
Matters that the standards themselves (as opposed to their application) must take account of. 28 F 89, #10 (requiring that the standards themselves take into consideration the relative difficulty of the work subject to review is NN) and #15 (requiring that standards take account of fact employees aren't responsible for delays and failures of the automatedsupport systems is NN). 19 F 9, ## 1-3 cited. See, also, 25 F 29, #4A (requiring that timeliness standards make allowances for the fact that employees must make decisions among conflicting work requirements is NN).
Compare with cases listed above in which FLRA has held that requiring that standards be consistent with position descriptions (which are chiefly used to determine classification and grade) is negotiable.
See, also, 47 F 91, #3, where FLRA said that "[p]roposals or provisions requiring management to 'consider' specific matters do not direct a particular result but, rather, permit management to weigh and assess the significance of those factors before reaching a decision. In this instance, the provision requires management to weigh an absence of unanimity in favor of a finding of difference in professional judgment rather than error, but it does not compel that conclusion, if other evidence supports the contrary result." Also 47 F 2, #14 (requiring management to consider all the job functions an employee performs in evaluating the employee is negotiable); 47 F 2, #33 (requiring management to consider all extenuating circumstances in rating an employee's performance is negotiable because "[p]roposals requiring management merely to 'consider' various factors in exercising a management right . . . do not directly interfere with the exercise of that right."); 38 F 147, ## 1 - 3 (requiring management to consider unusually time-consuming and uncontrollable duties when applying performance standards, are negotiable. "[T]he sole objective of the proposals . . . is to identify certain circumstances which management should consider when evaluating employee performance." FLRA distinguishes its finding here from the "consider" provisions in SSA, 34 FLRA 1000, 1005-06, where it was clear from the record that they were intended to "require management not only to review the specified factors in evaluating employee performance, but also to require management to modify the level of work required of an employee to achieve a given performance rating.")
Reflect expectations of average employees. 22 F 4, #4 (requiring that performance standards reflect the expectations of an average employee working at a normal rate is NN because it deals with the content of performance standards).
Conditions that must be satisfied. 15 F 1, #2 (proposal preventing establishment of performance standards based on production goals unless certain conditions are satisfied--e.g., work is repetitive, job content is constant, method of operation can be objectively and accurately measured, work units are equivalent--is NN. See, also, 15 F 5, #3.
Matters that must be excluded. 8 F 88, ##1 & 2 (requiring that standards not include elements of supervisory work, "matters of general conduct," or "compendia of administrative regulations" is NN).
Same standards for employees with, e.g., same PDs. 6 F 5 (requiring that employees with same PD to have the same standards is NN); 25 F 29, #3E & F (requiring that employees with the same job functions have identical standards is NN).
Written justification for negative standards. 27 F 37, #3F (it is NN to require a written justification for using negative standards because "[i]t would permit an arbitrator to review the reasons" and thus intrude in the exercise of the right to establish performance standards). However, as noted by FLRA in 42 FLRA 377, 403, "[t]he Authority has held that an agency's 'concern that an arbitrator's judgment may be substituted for its own is not a basis for precluding negotiation' over a proposal." Also see 39 FLRA @ 1200 where FLRA said that an agency's "concern that an arbitrator's judgment may be substituted for its own is not a basis for precluding negotiation" over a proposal. And in 30 F 76, a case involving exceptions to an arbitration award in which the Authority disagreed with an arbitrator who held that he had no authority to review performance standards, the Authority said the following:
[T]he concern with arbitrators' "substituting their judgment" for that of management presents no basis on which to preclude the arbitrability of grievances challenging the legality of those standards. Resolution of the grievance in this case by an arbitrator would not require an arbitrator to do anything other than what arbitrators do routinely in resolving other disputes, including those involving the exercise of other management rights such as discipline. An arbitrator would simply be examining an action by management to determine whether that action was lawful; that is, whether the performance standards established by management complied with law, as it is beyond dispute that they must. This sort of examination entails no more of a "substitution of judgment" than does a similar inquiry by arbitrators, MSPB, or the Federal Circuit in proceedings following performance-based actions against employees. . . . The question of any impermissible arbitral interference with management's rights must be directed to the merits, including remedy, of an arbitration decision relating to performance standards' consistency with law."
Other cases in which FLRA found "explanation" or "justification" proposals negotiable: 47 F 2, #16 (requiring justification for a timeliness standard that subtracts points when the employee is late but fails to add points when the employee is early); 47 F 2, #25 (requiring management to provide written explanations within 2 weeks when rejecting an employee's request for changes in goals is a negotiable (b)(2) procedure); 47 F 2, #37 (requiring approving officials, when they deny employee requests to raise their recommended ratings, to give their reasons in writing is a negotiable (b)(2) procedure).
Adjusting standards. Proposals barring or requiring adjustments in performance expectations (or having such an effect) normally are nonnegotiable. See, e.g., the following:
Weight to be given various duties. 49 F 128, #2 (requiring that reception duties, if performed, be weighted in a specified way when evaluating an employee is NN because the proposal would require adjustments in performance expectations regarding the weight to be given various duties and thus affects the content of performance standards. Nor is the proposal an appropriate arrangement because it isn't "tailored"--i.e., its application isn't restricted to employees who would be adversely affected by the exercise of management rights but instead applies to all unit employees.)
Time traveling between offices. 44 F 25, ##1 & 2 (excused time provisions for walking to the main building and for proofreading excessively interfere with the rights to direct and assign work. "The provisions would require the Agency to adjust performance expectations for trips made by employees between the old and new offices for certain functions . . . including trips that were deemed unnecessary by the Agency. . . . It is clear that the provisions would require the Agency to exclude from consideration a considerable amount of time and, in turn, make significant modifications to its performance requirements. Although the relocation is intended to be temporary, these exclusions and modifications could severely hamper the Agency's ability to hold employees accountable for their work performance during the period of the relocation.")
Delays in case processing time. 44 F 25, #3 (requiring that employees not be held accountable for "delays in case processing time caused by or related to the move or relocation" excessively interferes with the rights to direct and assign work. "Provision 3 would apply to delays in case processing that were either 'caused by' or 'related to' the move. This standard is quite broad and could require significant and extensive adjustments to existing performance expectations.")
Prohibiting performance standard revisions. 42 F 78, #30 (prohibiting changes in performance standards excessively interferes with the rights to direct employees and assign work. "Contrary to the Union's interpretation of the proposal, the proposal would not only prohibit 'bad faith' revisions in performance standards. Instead, the proposal applies . . . to [any changes]. [A]s the Agency argues, employees' ability to meet or exceed existing standards may be an appropriate consideration in determining whether such standards are accurate measures of satisfactory performance.")
Reflect effects of space changes. 21 F 129, ##17 & 20 (requiring that standards be adjusted to reflect the adverse impact of space changes on performance is NN because it deals with the content of standards.)
There are, however, some "appropriate arrangement" exceptions to the rule. See, e.g., 47 F 2, #26 (protecting employees from adverse performance evaluations due to directed or authorized performance of non-examining functions is a negotiable appropriate arrangement. Because #26 required management to make adjustments to production expectations, it directly interfered with the rights to direct employees and assign work. However, the proposal passed the appropriate arrangement excessive interference test because the "benefits afforded to unit employees by assuring that their evaluations will be based on those performance elements over which the employees have control outweighed the burdens imposed on management's rights to direct employees and assign work."
Resolving disputes over performance standards. Although FLRA initially held that grievances disputing the establishment of standards and the identification of elements were nonarbitrable, court decisions--e.g., Rogers v. Department of Defense Dependents Schools, 814 F.2d 1549, 1553 (Fed. Cir. 1987)--caused it to reverse its position in 30 F 127 (a case involving exceptions to an arbitration award rather than negotiability), where it said the following:
In deciding the merits of a grievance [challenging the legality of performance standards that have not yet been applied], an arbitrator may examine the performance standards and elements established by management for the grievant only in order to determine whether they comply with applicable legal and regulatory requirements, notably the provisions of 5 U.S.C. 4302 and 5 C.F.R. Chapter 430. If an arbitrator were to find that a grievant's performance plan did not comply with applicable legal requirements, the appropriate remedy would be for the arbitrator to direct the Agency to establish a plan which complies with applicable legal requirements. . . .
An arbitrator may not determine what the content of the employee's [performance] plan should be and may not establish new performance standards. Further, an arbitrator could not impose requirements on an agency beyond those mandated by applicable law and regulation. . . .
Further, in our view, an arbitrator's award which addresses whether an employee's performance standards comply with applicable law should be consistent with the principles set forth in relevant MSPB and Federal Circuit cases, including those discussed above in section B. We would expect parties to present relevant case law and other materials to an arbitrator to assist in the resolution of any dispute concerning this issue. Our review of exceptions to an arbitrator's award on such a matter would be limited to the narrow grounds set forth in section 7122(a) of the Statute--that is, an award would be found deficient only (1) if it is contrary to any law, rule, or regulation, or (2) on other grounds similar to those applied by Federal courts in private sector labor-management relations.
In rejecting the contention of the activity and OPM that only a performance-based personnel action could be grieved, FLRA held "that a grievance alleging that management violated applicable law when it established a grievant's performance standards and elements, but has not yet evaluated the grievant against the standards and elements, is arbitrable unless the parties have excluded it from the scope of their negotiated grievance procedure."
Although summaries of the case law dealing with exceptions to arbitration awards are beyond the scope of this guidance bulletin, we also want to call the reader's attention to 30 F 127 and 48 F 119. In 30 F 127 the Authority said the following about remedies that an arbitrator may order if he or she finds that established standards have not been applied or applied in violation of law, regulation, or negotiated agreement:
We now hold that when an arbitrator finds that management has not applied the established elements and standards or that management has applied the established elements and standards in violation of law, regulation, or a properly negotiated provision of the parties' collective bargaining agreement, the arbitrator may cancel the performance appraisal or rating. When the arbitrator is able to determine on the basis of the record presented what the rating of the grievant's work product or performance would have been under the established elements and standards, if they had been applied, or if the violation of law, regulation, or the collective bargaining agreement had not occurred, the arbitrator may direct management to grant the grievant that rating. If the record does not enable the Arbitrator to determine what the grievant's rating would have been, the arbitrator should direct that the grievant's work product or performance be reevaluated by management as appropriate.
Illegal appraisal system. In 48 F 119 the Authority turned down the agency's exceptions to an award in which the arbitrator sustained a grievance contesting the legality of the performance appraisal system for certain employees. (The arbitrator held that the agency's five-level rating system was presumptively contrary to 5 U.S.C. § 4302 because it provided for a written performance standard at only one of the five levels. He concluded, in FLRA's words, "that the absence of any guidelines describing performance requirements for any level above or below the fully successful level resulted in an 'unlimited' exercise of supervisory discretion which was inconsistent with 5 U.S.C. § 4302." As a remedy the arbitrator ordered the agency to establish a performance appraisal system that conforms with law and the contract.)
FLRA rejected the agency's claim that because OPM had certified FAA's performance management system, it was immune to further challenge by an arbitrator. It also rejected a claim that the award was contrary to FPM Bulletin 432-10, noting that the Bulletin expired on 7/20/90 and that the arbitrator found that the agency didn't use alternative forms of communication to apprise employees of their performance expectations. It also rejected the claim that the award is inconsistent with MSPB and Federal Circuit precedent interpreting 5 U.S.C. § 4302. "The Agency has cited no authority, and none is apparent to us, for its contention that the Arbitrator was required to examine individual cases or undertake 'a case-by-case examination o[f] the communication of performance expectations to each employee[.]'" A claim that the award was inconsistent with Wilson v. Department of Health and Human Services, 770 F.2d 1048, 1052 (Fed. Cir. 1985) also was rejected. FLRA noted that the arbitrator did not order the agency to provide standards at levels other than fully successful.
The Arbitrator merely found that the current rating system was invalid and directed the Agency "to establish a Performance Appraisal System that will conform with applicable statutory and contractual requirements." Award at 21. In other words, the Agency retains the discretion to determine the appropriate action necessary to establish a rating system that conforms to statutory and contractual requirements. For example, the Agency could apprise employees of performance expectations at levels above and below the fully successful level through alternative forms of communication.
Examples of proposals dealing with disputes over performance standards are as follows:
Refer disputes to reviewing official. 42 F 69, #4 (establishing a procedure whereby employees can bring disputes concerning their performance elements and standards to a reviewing official within the agency is negotiable). See, also, 25 F 90, #3 (requiring reviewing official to resolve disputes between employee and rating official over performance standards is negotiable).
Applicability of negotiated grievance procedure. 42 F 69, #9 (allowing the substance of critical elements, once applied, to be subject to the negotiated grievance procedure is negotiable). See, also, 3 F 107 and 31 F 36
Union-management advisory board. 36 F 5, #3 (establishing an advisory board, with union membership, to consider grievances over satisfactory or higher ratings is negotiable because the board only makes nonbinding recommendations to a deciding official). See, also, 31 F 36, #27.24.
Transfer to another supervisor. 29 F 116, #13 (permitting employee who prevails in a grievance over the application of performance standards to transfer to another supervisor at the employee's option interferes with the right to assign).
Fair application of standard. 26 F 107, #3 (allowing employee to grieve issue of whether the performance standard as applied to the employee is fair and reasonable is negotiable).
Grieving standards themselves. 22 F 4, #11 (allowing employee to grieve the standards themselves rather than their application is NN). See, also, 7 F 137; 7 F 88; and 7 F 34, #11. However, as noted above at the start of this subsection, FLRA abandoned the position taken in these cases in 30 F 127).
Performance-based actions. 7 F 34, #7 (proposal under which performance-based actions can be grieved is negotiable).
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Appraising Performance: Matters and Information that must or may not be considered
Restrictions on sampling methods, monitoring techniques, and data that may be used in evaluating performance. A substantial part of the negotiability case law on performance involves attempts by unions to negotiate indirectly the content of performance standards by, e.g., placing restrictions on the kind of data management can collect and consider in evaluating performance. Such restrictions are nonnegotiable because they have the effect of determining performance standards.
Documentation limitations. 46 F 147, #12 (placing substantive limitations on the documentation that the agency can collect for performance purposes directly interferes with the right to direct employees and assign work).
Data whose accuracy is verified. 46 F 108, #5 (requiring that performance be evaluated on the basis of records that can be verified as accurate interferes with 7106(a)(2)(A) and (B) rights. "Because the proposal precludes the Agency from using certain information in evaluating employee performance, it directly interferes with the Agency's right to direct employees and assign work." See, also, 34 F 116 (barring use of statistics not reviewed by the employee is NN. "Proposals which prevent management from using particular information in evaluating employee performance also preclude management from accurately evaluating an employee's work. Therefore, such proposals violate management's rights to direct employees and to assign work.")
Methods of monitoring performance. 44 F 54, #4 (prohibiting the agency from electronically monitoring the performance of unit employees excessively interferes with management's rights. The right to establish performance standards includes the right to determine the methods management will use to monitor performance). See, also, 34 F 163, #2, subsection a (requiring that observation be open and with the knowledge of the employee is NN); 29 F 61, #6 (barring certain monitoring techniques is NN--affirmed by D.C. Cir. in Overseas Education Association v. FLRA, No. 87-1576 (D.C. Cir. 8/31/88)); and 6 F 98 (precluding agency from using certain data obtained from monitoring telephone conversations with taxpayers is NN). Compare 34 F 163, #2, subsection a, above, with 39 F 25, #1 (requiring that performance ratings be based on "observable performance" is negotiable).
Circumstances under which information cannot be used. 44 F 5 (prohibiting, when rating the performance of an employee, the use of information available to the agency at the time of the employee's progress review and which wasn't provided to the employee at that meeting is a negotiable 7106(b)(3) appropriate arrangement. "[T]he proposal encourages the Agency promptly to bring to employees' attention information adversely affecting their performance. Employees' awareness of this information facilitates their ability both to correct inaccurate information and to improve performance before receiving final performance ratings.")
See, also, 39 F 5, #12 (requiring that any evaluation record not furnished to the affected employee within the specified time limit may not be used for evaluation purposes is a negotiable appropriate arrangement. "[T]he provision requires only that employees be provided with documents that management has already decided will be considered in assessing the employees' performance. In our view, the requirement that such existing documents be furnished to employees within a 45-day time frame, if the documents are to be used at all in evaluating employee performance, does not excessively interfere with [the rights to direct employees, assign work, and select]. . . . [T]imely disclosure of documents to employees affords benefits to management, in our view, by facilitating employee responses to such documents and, in some circumstances, by encouraging employees to alter their performance or behavior before more serious problems arise." In support of this statement, FLRA quotes from FPM Chap 430, subchap 2-3f re communicating and counseling employees during the appraisal period.) Compare with 34 F 116, immediately below.
Unreviewed statistics. 34 F 116 (barring use of statistics that are collected and/or released too late for the employee to effectively review and/or rebut is NN. "Proposals which prevent management from using particular information in evaluating employee performance also preclude management from accurately evaluating an employee's work. Therefore, such proposals violate management's rights to direct employees and to assign work.")
Approved leave. 33 F 86, ##2 and 4 (barring consideration of approved leave in appraising performance is NN: the proposal "is not limited to the subsequent assessment of the application of standards established by management, but, rather prescribes what may not be included in those standards"). Compare with 31 F 32, #12, 2nd paragraph (rating won't be adversely affected by use of officially approved leave is negotiable. FLRA's rationale for rejecting the agency's contention that this proposal interfered with its right to establish "rating elements or factors" is as follows: Performance standards are intended to establish the minimum level of job performance required of an employee in carrying out his or her assigned responsibilities. . . . The second paragraph does not prescribe the level of performance necessary to perform assigned work adequately nor does it require that any specified factors or elements be used in rating performance. Rather, the paragraph applies only after management has exercised its right to grant leave on request.
Student performance. 32 F 8, #1 (barring use of student test results to evaluate teachers is NN). See, also, 29 F 61, #6--affirmed by D.C. Cir. in Overseas Education Association v. FLRA, No. 87-1576 (D.C. Cir. 8/31/88) and 28 F 114, Article 16.
Errors that can't be considered. 28 F 89, #11 (barring consideration of errors not discovered until a review by the Quality Review section in evaluating the accuracy of the employee's work is NN);
Waiting time. 49 F 84, #2 (preventing management from considering time waiting for tools/equipment in evaluating performance is NN); 28 F 89, #16 (barring management from considering "time spent by employees on job before actual work assignments are made, and [allowing them] to wait for an assignment rather than seek out their supervisors to ask for work" is NN); and 12 F 17, #1 (barring consideration of time waiting for telephone in determining timeliness is NN).
Nonexamining time. 25 F 29, §9G (requiring that certain tasks be regarded as nonexamining time is NN).
Duties for which training hasn't been received. 48 F 54,#1 (barring management from evaluating an employee on an element on which the employee has not had sufficient training or experience to allow supervisors to objectively rate the employe's performance is NN because it excessively interferes with the management's rights); 9 F 87 (barring evaluation of assigned duties until the employer gives formal training on the new duties is NN).
Backlogs. 7 F 139, ## 6 & 7 (barring use of backlogs to determine productivity is NN).
Outside employee's control. Although FLRA has held that proposals requiring management to not hold employees responsible for matters beyond their control are nonnegotiable, it should be emphasized that most of these decisions did not involve the application of the "excessive interference" test to determine whether a proposal is an "appropriate arrangement." FLRA had initially reasoned that performance standards, by themselves, do not adversely affect employees, and thus such proposals do "not concern an arrangement for adversely affected employees within the meaning of section 7106(b)(3) of the Statute." However, that view was rejected by the D.C. Circuit in OEA v. FLRA, 876 F.2d 960 (D.C. Cir. May 25, 1989), where the court, in reviewing 28 F 88 and 29 F 56, said FLRA erred when it held that changes in job requirements do not have an adverse impact triggering (b)(3) appropriate arrangements bargaining until they result in adverse personnel actions. The appropriate arrangements reference applied to employees as a group, not to individuals (a position somewhat narrowed in later decisions by the D.C. Circuit when it insisted that appropriate arrangements had to be "tailored" to apply only to those employees adversely affected). Thus FLRA must consider, said the court, the impact of changes in job requirements to determine if there is an adverse effect justifying the application of the excessive interference negotiability test.
At any rate, here are examples of pre-OEA v. FLRA cases where FLRA found "outside the employee's control" proposals NN: 32 F 8, #1 (not holding employee responsible for factors beyond the employee's control is NN); 26 F 76, #2 (proposal stating that employees won't suffer adverse impact for failing to follow any aspect of a change in work procedures "when the circumstances are outside their control" is NN because it prevents the agency from evaluating the employee's ability to adapt and carry out their assignments in unforeseen circumstances); 26 F 55, #2 (employees won't be penalized for "situations outside their control" is NN); 19 F 9, ## 1 - 3 (proposals identifying work situations for which employees cannot be held accountable is NN). Although 36 F 81, #2 (requiring management to make allowances for matters beyond the employee's control is NN) is a post-OEA v. FLRA decision, it should be noted that the union did not make an "appropriate arrangement" argument in that case.
Compare the above with 47 F 2, #11 (proposal stating that "no employee shall be held responsible for matters beyond his control" is a negotiable appropriate arrangement because, among other things, "the burden placed on the Agency to avoid appraising employees on matters outside their control is slight"); 46 F 108, #1 (requiring management to make allowances for matters beyond the employee's control is a negotiable appropriate arrangement); 23 F 43, #7 (requiring that management take into consideration the fact that telephone contacts with claimants whose primary language isn't English when evaluating performance is a negotiable appropriate arrangement); 7 F 88, #3, 2nd sentence (requiring management to make allowances for factors beyond the employee's control in applying the standards is a negotiable appropriate arrangement) and 7 F 34, #2, 2nd sentence. It should be noted that FLRA did not apply any excessive interference balancing test in 7 F 34, 7 F 88, #3, 23 F 43, #7, but instead found those proposals negotiable because they were "merely a more specific description of the 'fair and equitable' criterion enunciated in [OPM, 3 F 120]" that was pertinent only in the context of the application of performance standards.
Proposals limiting how and when the agency can sample work performance. 39 F 101, #1, 1st sentence (precluding the use of the quality control process in appraising certain employees is NN); 39 F 68. #9 (mandating the number of reviewers of sampled work is NN because it deals with § 7106(b)(1) staffing patterns--a matter on which agencies have since been directed to bargain by section 2(d) of Executive Order 12871); 39 F 68, #14 (prohibiting the agency from reviewing the examination of a patent application before the case is completed by the examiner is nonnegotiable because the rights to direct and assign work include the right to determine how to sample work performance); 39 F 68, #17, §1 (requiring that each case be reviewed by at least two independent reviewers deals with § 7106(b)(1) staffing patterns).
However, with respect to the work review process, FLRA has found the following negotiable: 39 F 68, #10 (requiring an independent initial review--i.e., that each reviewer initially review the employee's work free of knowledge of any other reviewer's opinion of the work--is a negotiable procedure; but even if it interferes with management's rights, it is a negotiable appropriate arrangement: "once the initial reviews are complete, the reviewers may discuss the case among themselves . . . and may then deliberate without constraints, prior to a final determination"); 39 F 68, #11 (requiring reviewers to consult with examiners before reaching a judgment on the quality of the examiner's work is a negotiable procedure); 39 F 68, #17, §§ 2 & 3 (requiring that, whenever possible, reviewers have technical competence in the art area being reviewed is a negotiable appropriate arrangement: the proposal doesn't dictate that management assign any particular reviewers, the standard for assignment of reviewers is general and nonquantitative, "thus preserving a great deal of management discretion in these assignments," and the "whenever possible" phrase allows for instances "where there may be no available reviewer with extensive familiarity with the relevant subject matter"); 39 F 68, #18 (requiring disclosure of the reviewer's technical background, technical training, and experience in the art area is a negotiable procedure).
Compare with 38 F 17, #2 (requiring the appraiser to be at least one grade level above the employee to be appraised and to have consistently monitored the employee's work performance interferes with the right to assign work, and restricting the "reviewing official" to an individual who assigns, controls and is responsible for the work of the appraiser interferes with the right to assign work); 47 F 126 (requiring that the raters be at least a rank (or grade) higher than the rank (or grade) of the ratee is NN); 42 F 90, #1 (barring designation of the regional director as the reviewing official of a field office employee's performance rating excessively interferes with the right to assign work. "The proposal constitutes an absolute prohibition of the designation of the regional director as the reviewing official. Even assuming that Proposal 1 may benefit employees by ensuring that review takes place above the regional office, we find that that benefit is outweighed by the absolute prohibition on the exercise of management's right.")
Additional cases: 38 F 26, #1 (prohibiting unannounced audits is NN); 30 F 69, #33 (barring unannounced classroom observation is NN); 29 F 7, #1 (requiring that notice be given of classroom visits to evaluate performance excessively interferes with management's rights); 29 F 7, #3 (allowing only two formal classroom visits excessively interferes with management's rights); 30 F 69, #32 (barring various techniques in evaluating performance is NN); 28 F 89, #3 (manner in which work is to be sampled is NN); 26 F 99, ##2-6 (proposed sampling method limits the scope of the work that can be evaluated and therefore is NN); 22 F 57, ##2 &3 (barring use of enrollment statistics is NN); 25 F 2, #1C (precluding use of audits is NN); 18 F 60, ##1, 2, 5, & 7 (proposals precluding management from using auditing methods other than those proposed by the union are NN); 15 F 172, Measuring Productivity Proposals, #1 (imposing a ceiling on the frequency with which employee productivity is assessed is NN). Compare with 15 F 172, Random Sampling Proposals, #7 and 23 F 43, #1 (proposed assessment procedures that are "illustrative" rather than "restrictive" are negotiable: the proposals did not prevent management from scrutinizing employees' work more rigorously). Additional NN proposals: 33 F 61, #2 (establishing a 90-day grace period on the "writing of errors" related to a new procedure is NN); 28 F 89, ##4a (preventing management from charging employee with errors for the first 30 days after issuing guidance is NN); 28 F 89, #13 (barring evaluation during first two weeks in new section or first 120 days in a new position); 28 F 26, #7, 2nd part (barring audits of performance during first 120 days after a reassignment).
Moratoria on ratings when assigned new duties. Note: Regarding 28 F 26, #7, 2nd part, it should be noted that FLRA had earlier found negotiable proposals barring evaluation during the initial period after an employee had been assigned new duties. (See, e.g., 17 F 95, #1 and 15 F 112.) However, its decision in 17 F 95 was reversed by the 4th Circuit in HHS, SSA v. FLRA, 791 F.2d 324 (4th Cir. May 22, 1986). The court found the moratorium proposal nonnegotiable because it precluded management from assessing the ability of employees to respond to change. In 28 F 26, FLRA accepted the court's view and announced that it would no longer follow its earlier decisions. It said the following: "[B]roadly worded provisions, such as the one at issue here, do not merely postpone management's evaluation of employee performance of new duties. Rather, by precluding any evaluation of employees during a preliminary 'training' period, such proposals do not permit management to appraise employees on their ability to master new job requirements." It is doubtful, however, that FLRA was repudiating earlier holdings involving very brief moratoria where the proposals were found to be negotiable appropriate arrangements because, among other things, the burden on management is slight: see, e.g., 23 F 36 (reasonable time for employees returning from details to become familiar with directives issued in their absence); 25 F 29, §9c (3 hours time for employees to familiarize themselves with procedures they are applying for the first time); 26 F 76, #1 (employees given up to 2 hours non-measured work time to adapt to changes in work procedures); 47 F 2, #3 (providing emps with 3 hours non-examining time to become familiar with reexamination procedures when first assigned reexaminations, is a negotiable appropriate arrangement: "Provision 22 does not excessively interfere with management's right to assign work because the burden on management's right to assign work . . . is 'insubstantial' compared to the benefits afforded to employees and management in terms of improved work products.")
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When appraisals are to be given: Duration of the Appraisal cycle
Proposals prescribing the frequency with which appraisals are to be given, as well as the duration of the appraisal cycle, are § 7106(b)(2) negotiable procedures--provided that nothing in such proposals would prevent management from taking performance-based actions at any time. Although the first sentence of 5 CFR 430.206(a)(2) states that "[t]he appraisal period shall generally be designated so that employees shall be provided a rating of record on an annual basis," this does not mandate an annual appraisal period, as is made clear in the second sentence, which states that "[a]n appraisal program may provide that longer appraisal periods may be designated when work assignments and responsibilities so warrant or performance management objectives can be achieved more effectively." Nor do OPM's performance regulations mandate a minimum appraisal period. There is a requirement that there be one or more "progress reviews" during the appraisal period (see 5 CFR 430.207(b)), but there is no requirement that it result in a rating of record. In negotiating the duration of the appraisal period (assuming that it isn't fixed by agency regulations for which a compelling need exists), readers should keep in mind that OPM's RIF regulations provide that when employees "do not have three actual annual performance ratings of record received during the 4-year period prior to the date of issuance of reduction in force notices," RIF retention credits for performance will be based on "assumed" annual ratings of fully successful. (Underlining added. See 5 CFR 351.504(c).)
Because of its relevance, we quote from questions 34 and 35 of Questions and Answers on the Proposed Performance Management Regulations:
34. What is the maximum length allowable for appraisal periods?
Technically, there is no maximum length, but appraisal periods need to be reasonable. Of course, one consideration when choosing the length of the appraisal period is its relation to the annual rating of record required for RIF purposes. Agencies must look at the nature of the work done by various organizations and determine what length of time is appropriate as the basis for measuring employee performance. Unless it adopts and passes on the full flexibility of the regulations, an agency system must define any limits (maximum length, minimum length, or acceptable range) within which it will permit appraisal programs to designate their appraisal periods. Agencies could designate a single time period (e.g., 1 year) as a standard appraisal period throughout the agency, perhaps with a system provision for granting waivers.
36. Does an agency still have to use a minimum period of 90 to 120 days before performance can be appraised?
No. An agency program must specify the length of its minimum period and that minimum must fall within any limits established by the agency appraisal system. However, the outcomes of performance appraisals are applied in other personnel areas, and these applications create some practical limits for minimum periods.
For example, the regulations and statutory waiting periods for granting the within-grade pay increase from step 1 to step 2 for General Schedule and Prevailing Rate System employees rely on there being available a determination that the employee's performance merits the pay adjustment. Prevailing Rate System employees with a work performance rating of satisfactory or better are advanced to step 2 after 26 weeks, which implies that their performance must be ratable before that. Consequently, and without taking into consideration the nature of the work itself, the practical outside limit for the minimum period for prevailing rate employees is roughly 180 days.
In addition, the minimum period is one of the program features that may be subject to third-party review. Agencies are advised to exercise caution in determining the time limits to be used and avoid setting minimum periods that might be judged unreasonably short. Examples of proposals dealing with the duration of the appraisal period are as follows:
47 F 2, #21 (requiring evaluation of employee work performance at the completion of each assignment, is a negotiable (b)(2) procedure. "Proposals that determine when appraisals are to be given to employees do not directly interfere with management's right to assign work and constitute negotiable procedures.")
47 F 2, #32 (requiring rating officials to prepare one annual performance appraisal and conduct a midpoint performance review, is a negotiable (b)(2) procedure. "Matters concerning the timing of performance appraisals constitute procedures under section 7106(b)(2) of the Statute.")
47 F 2, #38 (requiring that appraisals be based on performance during the FY and that ratings generally will be finished by November 15, is a negotiable procedure).
35 F 30 (requiring that a periodic review of all elements be provided to the employee no more than 3 workdays before the end of the appraisal period doesn't violate 5 C.F.R. § 430.206(c) and is negotiable. Although a proposal requiring disclosure of ratings of record before approval by the final review violates OPM's regulations, FLRA concludes that "the proposal does not obligate the Agency to provide ratings of record . . . . Nothing in the plain wording of the proposal would require the progress review to include disclosure of specific ratings.")
34 F 163, #2, 1st sentences of subsections b and c (frequency of performance evaluations is negotiable).
29 F 50, #8 (requiring that annual appraisals be given within 5 days after employee gives notice of intent to leave and requiring that there be a rating conference 180 days before the formal rating is given are negotiable).
9 F 86, #3 (duration of performance cycle is negotiable).
7 F 34, #3, 1st sentence (requiring an annual appraisal rating is negotiable). "[T]he first sentence of the proposal merely concerns the duration of the performance appraisal cycle. . . . Nothing in . . . the proposal speaks to the issue of when the Agency may discipline an employee for unacceptable performance. Accordingly, the proposal would not prevent the taking of disciplinary action but is concerned with procedural matters which are within the duty to bargain under section 7106(b)(2) of the Statute."
5 F 14, #2 (requiring that performance appraisals be conducted on an annual basis is negotiable. "[U]nder both law and OPM regulations the frequency of periodic performance appraisals is a matter within the discretion of the Agency. Hence, to the extent that [a] proposal would establish such frequency, . . . it is not inconsistent with, but merely implements, the requirements of law and regulation for periodic appraisals and does not prevent management from taking appropriate action under law.")
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Information to be maintained and shared
In evaluating proposals requiring the maintenance and disclosure of information related to performance management, readers must be sensitive to Privacy Act issues. Recent case law on information that has to be provided to the union under 5 U.S.C. § 7114(b)(4), where the information arguably involves employee privacy, indicates that, e.g., unsanitized performance ratings are not disclosable without employee consent under either the Freedom of Information Act (FOIA) or the OPM "routine use" exceptions to the Privacy Act.
Regarding the FOIA exception, the Supreme Court's definition of "public interest" under the FOIA has forced FLRA to abandon earlier decisions in which it held that the promotion of collective bargaining was a "public interest" that could be used under the FOIA balancing test exemption to the Privacy Act. In the following cases, for example, the Authority has held that disclosure of the requested information in an unsanitized form is not required by the FOIA and thus is prohibited by the Privacy Act: 50 F 55 (performance ratings); 50 F 66 (candidate referral roster); 50 F 67 (names of employees receiving outstanding ratings); 51 F 7 (lists of award recipients); 51 F 8 (promotion appraisals); 51 F 9 (periodic performance reviews); 51 F 12 (EEO settlement agreement); 51 F 16 (performance ratings); and 51 F 19 (OPM ratings of employees originally selected for Federal employment).
Regarding the "routine use" exception involving requests for information other than home addresses, the Authority has held that requests for unsanitized performance appraisals (51 F 24) and individual performance plans containing performance ratings and supporting information (51 F 28) are not "necessary" within the meaning of OPM's routine use statement and thus not disclosable.
Another development that the reader should keep in mind, at least as far as the § 7114(b)(4) statutory duty to provide information is concerned, is the Authority's recent announcement, in 50 F 87, of the "particularized need" analytic approach it will apply to all union § 7114(b)(4) requests for information, regardless of whether the information constitutes "intra-management guidance." Under the new approach, the union must specify why it needs the information, the uses to which the information will be put, and the connection between those uses and the union's representational responsibilities. "The union is responsible for articulating and explaining its interests in disclosure of the information. Satisfying this burden requires more than a conclusory or bare assertion. Among other things, a request for information must be sufficient to permit an agency to make a reasoned judgment as to whether information must be disclosed under the Statute." In denying a union's request for information, the agency must assert any countervailing anti-disclosure interests. That burden isn't satisfied by making conclusory or bare assertions or simply saying "no." If the union establishes a "particularized need" and the agency either hasn't established a countervailing interest or FLRA concludes that such an established interest doesn't outweigh the particularized need established by the union, refusal to provide the information will be an unfair labor practice.
In applying the above analytical approach to the facts of the case in 50 F 87, the Authority found that the union had demonstrated a particularized need for the performance rating of a nonunit employee and that the agency failed to assert any anti-disclosure interests (apparently the agency did not contend that disclosure was barred by the Privacy Act), and accordingly held that the agency committed an unfair labor practice when it didn't provide the information. But in 51 F 26, in which FLRA held that disclosure of unsanitized performance ratings and progress reviews were barred by the Privacy Act, the Authority also held, with respect to union requests for other information, such as case management and assignment sheets, that the union failed to satisfy its "burden of articulating and establishing, with specificity, why it needed the information, the uses to which it would be put, and the connection between those uses and the Union's representational responsibilities."
Examples of case law on the maintenance and disclosure of performance-related information is as follows:
Records to be kept. Proposals requiring that certain kinds of information be maintained are negotiable. See, e.g., 48 F 14, #14 (time used to do redo work); 47 F 91, #1 ("post" work or training new classifiers); 47 F 66, ## 2 and 3 (documentation supporting appraisals); 47 F 2, #20 (time spent on recordkeeping); 47 F 2, ## 23 and 24 (recording aspects of work); 47 F 2, ## 29 and 30 (documentation supporting ratings and used to resolve complaints); 38 F 26, #1, 2nd sentence (employee absences and time spent on adjudication: the proposal "merely requires management to maintain a record of specific performance-related information, but does not dictate how management will use that information"); 37 F 79, #1B (retain at least 3 ratings); 37 F 79, #1F (form must be annotated to show why employee has no current rating of record); 25 F 29, §9D (recording time spent on aspects of work); 21 F 28, ## 2 and 3 (because no compelling need for regulations requiring use of a standard form, proposals requiring that negotiated forms be used to communicate performance requirements and to evaluate overall performance are negotiable).
Examples of information to be provided to the employee. Proposals requiring that certain kinds of information related to an employee's work be provided to the employee are negotiable. See, e.g., 47 F 91, #2 (identifying each reviewer and listing all errors); 47 F 66, ## 2 and 3 (information to be shown employee when there's a decline in performance); 47 F 2, ## 25 & 28 (requiring that employee receive performance standards at the beginning of the rating period); 47 F 2, #13 (policies referred to in the standards must be attached to the employee's performance plan); 47 F 2, #19 (annual list of reasons management has used to grant a waiver or excuse: "Provision 19 requires nothing more than publication of guidance for unit employees and does not obligate the Agency to incorporate into its performance standards the list of possible bases and reasons that would justify grants of waivers or excuses."); 47 F 2, #31 (disclose deficiencies to employee, normally within two weeks of their discovery); 47 F 2, #34 (notify employees of scheduled date and time of formal appraisal meetings); 47 F 2, #47 (notify employee of negative ALOC determination no later than the pay period after completion of the.waiting period); 30 F 69, #8 (give probationary employee a written summary of quarterly discussions of performance); 30 F 69, #32 (notifying employees of evaluation techniques used); 30 F 69, #33 (notifying employees within 10 days of the results of unannounced classroom observation); 28 F 89, #4a (provide employees with written guidance and reference materials needed for satisfactory performance of job); 27 F 37, #3A (requiring that employee get a copy of his/her performance appraisals at least 3 days in advance of mid-cycle and end-of-cycle appraisal review); 27 F 37, #3G (requiring supervisor to respond in writing to employee questions and suggestions related to the employee's performance standards).
Examples of information to be provided to the union. 45 F 134 (requiring the agency, when it grants cash awards to some but not all employees rated highly successful, to provide the union access to employee documents containing reasons why individual employees, also rated highly successful, didn't receive cash awards is negotiable); 32 F 140, #1 (providing the union with reasons for selecting critical elements is negotiable); 32 F 104, #2 (providing the union with all statistical data used to develop performance standards is negotiable); 25 F 2, #3C (providing the union with a "full explanation" of how it arrived at performance standards); 15 F 1, #1 (requiring that work study information be provided to the union within 5 days after completion of study); 7 F 34, #5 (providing the union with data from work studies).
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Employee and Union Participation in Developing Standards
Proposals providing for employee and union participation in the development of performance standards are negotiable, provided that such participation does not give them authority to establish or veto the establishment of performance elements, levels or standards or otherwise interfere with rights reserved to management.
Labor-management committees. Regarding the establishment of union-management joint committees, readers are reminded that FLRA has long held that management's rights are not interfered with when such bilaterally-established committees make recommendations on how management is to exercise its reserved rights--i.e., when such jointly-established committees are advisory in nature. See, e.g., 7 F 34, #6 (establishing a joint committee to recommend changes to the performance appraisal system is negotiable); 12 F 110 (requiring that there be two union representatives on an incentive awards committee that makes recommendations to the Regional Director, who has final authority to approve or disapprove recommended awards, is negotiable); 14 F 69 (proposal establishing a joint labor-management committee to evaluate training needs and formulate programs to meet those needs is negotiable. "The proposal would only provide the Union an opportunity to express its views regarding the Agency's training programs, rather than mandating joint determination of the substantive aspects of those programs."); and 25 F 53, #2 (although "proposals seeking union membership on formal organizational structures utilized by management as an integral part of its substantive decision-making process under section 7106 . . . are nonnegotiable," joint LMR advisory committees are negotiable. "Further, because the participation of employees on this committee does not involve official, prescribed duties of those employees," the provision doesn't concern the assignment of work).
Employee participation
47 F 2, #9 (requiring management to complete meetings with employees to discuss the establishment of modification of a performance appraisal plan within two weeks of the first meeting is a negotiable procedure under § 7106(b)(2)).
42 F 69, #3, 2nd sentence (after interpreting a provision that expressly states that "[t]he identification of performance elements and the establishment of performance standards . . . should be a joint . . . communication process between the UNION, the employee and his/her supervisor" as "merely allow[ing] for employee participation in the formulation of performance standards without requiring negotiation over the content of those standards," FLRA concludes that the provision doesn't directly interfere with management's rights). 29 F 116, #1, 1st sentence (requiring management, when a proposed performance appraisal plan applies to no more than 15 employees, to hold a meeting with the employees to get their input, is negotiable).
15 F 9, #1 (requiring that supervisors and employees meet at least once a year (with presence and participation of the shop steward) to discuss performance requirements for the next rating period is negotiable).
13 F 75, #1 (requiring that the proposed performance standards be discussed first with the employee, then with the reviewer, and then up the appraisal chain, is a negotiable § 7106(b)(2) procedure).
3 F 119 ("the manner in which a particular agency provides for . . . employee participation [in establishing performance standards] is within the agency's discretion and, therefore, within the duty to bargain to the extent that it would not prevent the agency from establishing performance standards and critical elements pursuant to [management's] statutory rights to direct employees and assign work.")
Union participation
30 F 137, #9 (provision stating that the union shall participate in studies conducted on employees in the development or revision of the performance system is negotiable).
27 F 37, #3F (creating a joint labor-management committee to investigate complaints received from colleagues and/or patients is negotiable. FLRA said that "this portion of the proposal does not involve the assignment of work since the responsibilities of the committee do not involve official prescribed duties.")
22 F 4, #1 (requiring management to give the union an opportunity to comment (but not negotiate) on performance standards is negotiable).
22 F 4, #2 (requiring management to timely furnish the union with copies of performance standards is negotiable).
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Higher level review
OPM's new performance regulations require higher level review only of an "unacceptablev (level 1) rating of record. See 5 CFR 430.208(e). Other previous requirements for higher level review--e.g., former 5 CFR 430.206(c) requiring higher level review of all ratings of record, former 5 CFR 430.204(f) requiring higher level review of an employee's performance plan, and former 5 CFR 430.504(d) requiring higher level review and approval of both the decision to grant a performance award and its amount--have all been eliminated, thereby leaving to agency discretion the decision whether, and under what circumstances, higher level review will be required.
The question immediately arises whether this increased discretion is exclusively reserved to the agency by management's reserved rights under 5 U.S.C. § 7106 or whether decisions relating to higher level review are subject to negotiation. FLRA's decision in 42 F 90, #2, supports the conclusion that higher level review associated with the exercise of a management right is part of management's internal deliberations. Therefore, any attempt to impose or prohibit higher level review with respect to the exercise of a management right interferes with those internal deliberation rights.
In 42 F 90, #2, FLRA held that a proposal designed to prevent any discussions between the appraising and reviewing officials before the appraising official forwards an independent appraisal to the reviewing official directly interferes with the deliberative process associated with management's evaluation of employees. Although FLRA went on to find the proposal a negotiable appropriate arrangement (a determination later reversed by the D.C. Circuit in NLRB v. FLRA, No. 91-1608 (D.C. Cir. 8/31/93) because the proposal wasn't "tailored" to apply only to employees who would be adversely affected by the exercise of management rights), that doesn't alter the fact that FLRA regarded the higher level review by the reviewing official of the appraising official's rating of an employee as part of management's deliberative process. Indeed, in justifying its conclusion that the proposal is an appropriate arrangement FLRA emphasized that while this particular proposal "prevents initial discussions between the appraising official and the reviewing official, it would not preclude management from discussing the appraising official's 'independent evaluation' with that official after receipt of the document and prior to any final action. Management would still be able to engage in internal deliberations and could, after doing so, reach a different assessment of the employee's performance. Thus, the burden imposed by [the proposal] on management's rights to direct employees and assign work is minimal."
The Authority's reasoning with respect to higher level review of performance appraisals presumably would also apply to higher level review of performance standards. See, e.g., 27 F 79, #12, 2nd sentence (proposal limiting rating official's ability to discuss a performance report with other personnel interferes with the deliberative process associated with the right to assign work); 21 F 104, #3 and the cases cited therein (requiring management to tell the employee whenever a higher level management official asks about the assignment of work to the employee interjects the employee into the internal deliberations relating to work assignment and thus interferes with the right to assign work); and 15 F 1, #1 (union involvement in managerial deliberations that are part of the decision-making process directly relating to the exercise of the right to establish performance standards is NN).
The same cannot be said for higher level review of performance awards, to which we now turn.
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Performance Awards
The case law relating to performance awards has had a number of twists and turns and it will probably make took another sharp turn [in 52 FLRA No. 117] as a result of OPM's new regulations which eliminate the requirement for higher level review of performance awards.
The Authority initially found nonnegotiable proposals requiring negotiation of performance standards for incentive pay purposes (14 F 77), or mandating a monetary award for employees receiving an outstanding rating (16 F 114, #4), or establishing the amount of monetary awards for outstanding and superior performance (21 F 18), or providing for union participation in any management-established committees that are part of the decision-making process (i.e., "internal deliberations") relating to the selection of recipients for performance awards (19 F 86, 22 F 4). FLRA reasoned that the determination as to whether a particular level of performance warrants a reward is an integral aspect of management's rights to direct employees and assign work.
However, in NTEU v. FLRA, 793 F.2d 371 (DC Cir. 1986), the D.C. Circuit held that the rights to direct and assign work do not, by themselves, include the right to reward performance and said the following in reversing FLRA's decision in 14 F 77:
The right to reward for superior performance of assigned work is surely a good deal less implicit in the right to assign work than is the right to sanction for inferior performance. Yet the statute sets forth the latter right explicitly, including, as a separate, nonnegotiable management power, the right to "suspend, remove, reduce in grade and pay, or take other disciplinary action." 5 US.C. § 7106(a)(2)(A). This demonstrates, we think, that the terms "assign work" and "direct employees" were not meant to be so expansive as to include whatever is useful for getting the agency's work done in a particular manner of priority, but were rather descriptions of a precise, defined management activity.
In 27 F 25, the Authority accepted the court's holding, rejected the agency's remaining "conditions of employment" (COE) and "budget" arguments, and found a proposal establishing incentive pay or performance award rates to be negotiable. In rejecting the agency's budget argument, FLRA noted that the very nature of incentive pay or performance award implies that the increased costs would be offset by compensating benefits: "the proposal specifically links the amount of incentive money to be awarded to increases in an employee's productivity, which would directly benefit the Agency's 'objective of greater efficiency in Government."
Relying on its reasoning in 27 F 25, FLRA found negotiable a proposal establishing a formula for determining the amount of the award (27 F 61) and proceeded to find negotiable proposals establishing mandatory performance awards as various percentages of salary (30 F 135, #1), and a series of proposals relating to performance awards (31 F 72). Although FLRA uniformly rejected arguments based on the second prong of its budget test (involving a cost/compensating benefits balancing test), in 38 F 127, #1, FLRA found nonnegotiable a proposal having the effect of establishing a ceiling on the amount of money the agency may have available in its budget for performance awards because it violated the first prong of its budget test--i.e., the proposal interfered with management's right to budget because it prescribed "the particular programs to be included in the budget or the amount to be allocated in the budget for those programs."
But then the case law shifted from management rights' arguments to claims that proposals mandating awards and their amounts were inconsistent with Governmentwide regulations. At first FLRA interpreted the regulatory requirement that awards be reviewed and approved "to effectively reserve to reviewing officials the discretion to disapprove the decision to give an award but not necessarily to determine the amount of the award" (38 F 46, ## 11 & 12, subsequently remanded to FLRA by the D.C. Circuit in Naval Underwater Systems Center v. FLRA, No. 91-1045 (D.C. Cir. July 23, 1991) at FLRA's request because OPM had just modified 5 CFR 430.504(d).). But, as a result of a further modification of OPM's regulation that clarified its intent. FLRA held that the review and approval requirement of 5 CFR 430.503(c)(1) applied to both the decision to grant an award and the amount of the award.) See, e.g., 38 F 84, #1; 40 F 1; 40 F 5; 41 F 104, #3; 43 F 3; 43 F 42, #3; 43 F 117, #16; 44 F 60; 45 F 52; 45 F 134; and 48 F 54.
In 47 F 95 the Authority, for the first time, found that a proposal requiring a 25% increase in pay violated the 2nd prong of the budget test because it would impose "significant" costs on the agency and the potential for compensating benefits was limited.We've given this historical sketch because of what it might tell us about how FLRA will probably treat proposals mandating performance awards and/or their amounts, now that OPM's regulations no longer mandate higher level review and approval.
Claims that such proposals are nonnegotiable because they interfere with management's rights to direct employees, assign work, or to budget would probably be rejected by the Authority for the reasons given in its earlier decisions rejecting such contentions. Although higher level review associated with the exercise of a management right involves "internal deliberations," as was noted in section VIII above, the D.C. Circuit rejected the Authority's initial position that the rights to direct employees and assign work encompassed the right to reward employees for performance. Unless a case can be made that some other management right encompasses the right to reward, management-established higher-level review requirements would not be protected by management rights. Agency regulations may, of course, require higher level review and approval. But would those regulations survive a "compelling need" challenge raised by unions representing bargaining units that don't include "a majority of the employees in the issuing agency or primary national subdivision"? Time will tell. [In 52 FLRA No. 117, the Authority, noting that OPM regulations no longer mandate higher level review, found a proposal on performance awards negotiable.]
Closely related to the question of negotiability is the question of whether agencies--even agencies that have no immediate plans to change their performance management systems--would be required to engage in union-initiated midterm bargaining on the matter of performance awards now that OPM has removed its regulatory limitation on agency discretion regarding the review and approval of performance awards. Apart from evidence that the union has waived its right to initiate midterm bargaining on new matters, an agency's obligation to engage in such bargaining will depend on whether a case can be made that union proposals mandating performance awards are already "covered" by the existing agreement. (Although the 4th Circuit, in SSA v. FLRA, 956 F.2d 1290 (1992), has held that unions have no statutory right to initiate midterm bargaining on new matters, FLRA has instead been following the D.C. Circuit, which has held that there is such a duty, except where the matter is "covered by" the agreement.)
In this connection, the reader is referred to 47 F 96, where the Authority, in a case involving incentive awards, sets forth the test it will use to determine whether a matter is "covered by" the agreement. In finding that the activity did not commit an unfair labor practice when it refused to bargain on proposals requiring it to notify the union when performance award money became available and requiring that 20% of that money be set aside for employees whose appraisals are subsequently raised because of grievance or EEO complaint remedies, the Authority held that the proposals were already "covered by" an article in the national agreement. Regarding the proposal requiring notification of the availability of performance award money, FLRA said the following: "Although [the agreement] does not provide for the provision of information about the awards program before the distribution of awards, that issue is . . . inseparably bound up with the information provisions set forth in Section 4 [of Article 17 of the agreement]. Regarding the proposal that 20% of the money be set aside as remedies for successful grievants and EEO appellants, it noted that Article 17 described the operation of the awards program "within the context of budgetary considerations and limitations," and concluded that "[i]t is reasonable to assume that the parties recognized that . . . the effectiveness of the program could be diminished by the failure to retain sufficient funds to provide remedies ordered as a result of third-party proceedings. Accordingly, the Union should have contemplated that the negotiated provisions would foreclose further bargaining in such situations."
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Performance and RIF Credits
The most common concern expressed by individuals and organizations commenting on OPM's new regulations permitting two-level rating systems was a concern over RIF length-of-service credits. Commenters noted that employees placed in two-level systems would be placed at a disadvantage when competing with employees who previously were in, say, five-level rating systems. That concern will probably surface in negotiations implementing two-level systems for bargaining unit employees.
However, as the case law demonstrates, any proposals dealing with RIF service credits that are inconsistent with OPM's regulations are nonnegotiable. See, in this connection, 37 F 79, #1C (requiring use of three retained ratings without regard to the dates they were issued violates 5 CFR 351.504(c)); 29 F 41, §5.B (providing for 4 years for an outstanding rating and 2 years for excellent is NN); 21 F 59 (providing for 3 years of RIF credits for excellent rating is NN); 18 F 18 (requiring that 4 years of RIF credits be given employees with a satisfactory overall rating if they have been rated outstanding on any element is NN); 17 F 112 (requiring that performance appraisals be frozen when decision is made to run a RIF is NN because inconsistent with regulations requiring they be frozen on date of issuance of specific RIF notices); 16 F 127 (4 years service credit for employee rated outstanding on any performance element is NN); 7 F 111 (requiring the activity to use the employee's civilian performance rating, rather than a combined military-civilian performance rating, is NN because it conflicts with agency regulations for which a compelling need exists).
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Performance and Within-Grade Increases
The following is a summary of case law involving the impact of performance ratings on within-grade increases: 46 F 67, #18, 2C; 28 F 81, #4; and 14 F 2, #8 (requiring that an employee whose performance becomes fully successful receive the within-grade increase retroactive to the date it was due is nonnegotiable because inconsistent with 5 CFR 531.412(b)); 38 F 46, #9 (requiring that all outstanding employees get QSIs if one employee is granted a QSI for an outstanding rating violates 5 C.F.R. § 531.504, which permitted (but did not mandate) the granting of QSIs for outstanding ratings (which has since been changed to the highest rating of record that can be achieved); 30 F 135, #2 (mandating a QSI if certain criteria are met conflicts with 5 CFR 531.504, which says that a "quality step increase shall not be required but may be granted" if certain conditions are met); 29 F 116, #9 (allowing a marginal rating to warrant a within-grade violates § 531.404(a), which requires a fully successful rating); 29 F 116, #10 (making a failure to furnish written negative ALOC determination within prescribed time limits conclusive evidence of ALOC violates FPM 531); 29 F 116, #11 (length of time during which performance amounting to an ALOC must be maintained to overcome a prior denial of a within-grade increase is negotiable because § 531.411 "allows the Agency discretion to determine the length of the performance period before management reevaluates an employee who was previously denied a within-grade increase"); 25 F 29, §5 (requiring that an inverse proportionality criterion be used to determine level of performance needed to justify denial of a within-grade denial is NN); 25 F 29, §9H (achievement of 75% of the assigned production goal is sufficient to constitute an ALOC on the factor of quantity warranting the granting of a within-grade increase is NN); 23 F 21, #1 (requiring that within-grade determinations be based on audit of record conflicts with § 531.404(a)(1); 12 F 128 (requiring step increase if employee's performance in at least one element exceeds the minimum standard for satisfactory is inconsistent with 430.202(e)); and 3 F 119, subsection B (requiring that a standard of performance that is adequate for job retention also makes one eligible for a within-grade increase is NN because inconsistent with § 531.407(e), which requires performance above a level sufficient for job retention).
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Proposals relating to performance-based actions
Proposals seeking to add to statutory procedural requirements are nonnegotiable, as are proposals mandating "progressive" discipline (i.e., requiring that an employee be reassigned before demoted and/or demoted before removed).
47 F 67, #2 (barring use of supervisory notes or diaries to support disciplinary actions and performance-related actions unless affected employees are shown and provided copies of said documents is a negotiable appropriate arrangement. Proposals substantively similar to a provision in 39 F 5.) Compare with 39 F 13, #9, §§ b and c, where FLRA found excessive interference regarding a proposal requiring that supervisory notes be shown to, and initialed by, the employee within 15 days of their creation: otherwise they couldn't be used to take action against the employee.
47 F 2, #43 (defining performance-based action to include reduction in rank is negotiable). Reversed in its entirety, along with #45, discussed below, by the D.C. Circuit in Patent and Trademark Office v. FLRA, 26 F.3d 1148 (D.C. Cir. 1994).
47 F 2, #45 (requiring the agency to provide a performance improvement plan for an employee facing performance-based disciplinary action is negotiable). Reversed by the D.C. Circuit in Patent and Trademark Office v. FLRA, Nos. 93-1255, -1293 (D.C. Cir. June 28, 1994). The court said the following:
While acting to empower agencies to deal with unsatisfactory employees, Congress was careful to protect the rights of employees affected by performance-based actions. It provided several "due process" procedures with which an agency must comply before taking action under Chapter 43. See 5 U.S.C. § 4303(b)(1) . . . . Thus, Congress obviously intended to strike a delicate balance between the rights of management to eliminate poor performers and the rights of affected employees to procedural protections.
The Union's attempt to add to the procedural side of this equation in this case impermissibly frustrates the "dominant intent of [Congress] . . . 'to simplify and expedite procedures for dismissals of Federal employees whose performance is below the acceptable level within a comprehensive framework for performance evaluation.'" Lisiecki, 769 F.2d at 1564 (quoting S. REP. No. 969, 95th Cong., 2d Sess. 10, reprinted in 1978 U.S.C.C.A.N. 2782). Indeed, proposal 45 would represent a large step back toward the problems inherent in performance-based actions arising under Chapter 75, and would substantially hamper management's ability to deal with unsatisfactory performers within the Agency. . . . [W]e agree with the Agency that requiring it to provide a written performance improvement plan any time it wishes to demote or dismiss an employee, impermissibly curtails its discretion to discipline employees through either Chapter 75 or Chapter 43. The Agency should be free to take such actions through Chapter 75, which does not require a performance improvement plan, and accept as a consequence the procedural obstacles and heightened burden of proof attendant to actions under that Chapter. For the reasons discussed, we hold that proposals 43 and 45 (in its entirety) are nonnegotiable.
47 F 2, #46 (requiring that performance-based disciplinary actions be progressive excessively interferes with the right to discipline).
47 F 2, #48 (providing that the agency will destroy all documents generated as part of a canceled performance-based disciplinary action, is negotiable. "[A]lthough section 4304(d) requires deletion of relevant records at a certain time, it does not prevent their earlier deletion. Accordingly, we conclude that Provision 48 is not inconsistent with 5 U.S.C. § 4303(d)."
44 F 116, #24 (requiring the agency to return employees selected for bridge positions to their former or comparable positions if they fail to attain satisfactory performance levels in those entry-level positions excessively interferes with right to assign employees).
41 F 52, 2nd sentence (requiring that supervisory notes on performance be retained no longer than a year, or the duration of the rating period, is nonnegotiable because it excessively interferes with the right to discipline. Proposals that restrict an agency's use of materials and documentation as evidence directly interfere with the right to discipline).
39 F 13, #9, §d (barring use of supervisory notes that are over 18 months old in supporting adverse actions excessively interferes with right to discipline).
38 F 46, #13 (requiring that an employee whose performance is unacceptable and who has been determined to be qualified for another available position be reassigned to that position interferes with the right to assign employees).
31 F 36, #27.13.1.1 (permitting the agency, in a notice of proposed disciplinary action, to list only those specific instances of unacceptable performance which occurred during the opportunity period violates 5 USC 4303(c)(2)(A). "By limiting the citation of instances of unacceptable performance to those which occurred during the employee's improvement period, Proposal 27.13.1.1 would preclude the Agency from relying on instances of unacceptable performance which occurred prior to the opportunity to improve. Under the proposal, the Agency could not notify an employee that instances of unacceptable performance which occurred before the opportunity period will be considered. Since the Agency could not notify the employee, the Agency could not rely on those instances of unacceptable conduct without violating the notice requirement of section 4303.")
29 F 116, #6 (barring disciplinary action unless it can be established that the employee's performance was unacceptable over a period of at least 12 months, on average, is nonnegotiable because inconsistent with 5 CFR 432.203(a).)
29 F 116, #7 (an opportunity-to-improve period of up to 7 pay periods is negotiable, even if it extends such a period to employees whose performance is marginal. "While applicable law and regulation only require an improvement period for employees whose performance is unsatisfactory, there is nothing in law or regulation which precludes an improvement period for employees whose performance is marginal.")
29 F 116, #8 (limiting penalty when employee is demoted by requiring that the demotion be to the 5th step excessively interferes with the right to take disciplinary action.)
29 F 50, #8, §4A (requiring 90-day notice before giving employee an unsatisfactory rating is negotiable).
29 F 50, #8, §4B (90-day opportunity period is negotiable. See, also 27 F 79, #7, §4 re 90-day counseling period).
Progressive performance-based disciplinary action. Proposals limiting the actions that may be taken for unacceptable performance are NN. See, e.g., the following: 29 F 50, #8, §4C (requiring that an employee whose performance remains unsatisfactory after the improvement period be reassigned and given an additional 60 days to perform satisfactorily in the new position is nonnegotiable). See, also, 27 F 68, #6; 25 F 2, #1B (requiring that the employee be trained rather than demoted, reassigned, or removed, excessively interferes with the right to take those actions); 21 F 28, #6; 16 F 114, #7; 15 F 12 (excessive interference); 18 F 42; 15 F 1, #3; 14 F 64, #2; and 14 F 64, #3 (giving employee option of being reassigned is NN).
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Treatment of Employees on Official Time
As was noted by the Authority in 42 F 88, #2, 5 U.S.C. § 4302 requires that elements and standards encompass only agency-assigned duties. This is confirmed in the Supplementary Information section of OPM's new performance regulations:
Under performance appraisal provisions in part 430, the performance to be planned, monitored, and rated covers the work, duties, and responsibilities that accomplish the agency mission and for which the employee is accountable to the employing organization. When an employee is serving as the representative of a labor organization, he or she is performing duties for that labor organization. To intermingle performance of the representational duties into the appraisal program would be inappropriate because appraisal of the employee's performance must be based solely upon the employee's performance of agency duties. For employees who spend 100 percent of their time as labor representatives, and for employees who spend a significant amount of time as determined by the agency, this means that they cannot, and should not, be given performance appraisal ratings of record.
At any rate, OPM's new performance regulations continue to limit ratings of record to the actual performance of agency-assigned work during the rating period and continue to preclude "presumptive" or "assumed" or "carry-over" ratings of record. See 5 CFR 430.208(g).
However, ratings of record are not needed for certain purposes. For example, OPM's RIF regulations at § 351.504(c) make use of "assumed" ratings for employees that don't have three ratings of record for the 4-year period preceding the issuance of RIF notices in determining service credit based on performance.
Moreover, § 531.409(d)(1)(v) of the new regulations provides for a waiver of ALOC (acceptable level of competence) determinations with regard to within-grade increases (WIGIs) when "the employee has had insufficient time to demonstrate an acceptable level of competence due to authorized activities of official interest to the agency not subject to appraisal under part 430 of this chapter (including, but not limited to, labor-management partnership activities under section 2 of Executive Order 12871 and serving as a representative of a labor organization under chapter 71 of title 5, United States Code)."
Although performance awards (including QSIs, not to be confused with ALOC WIGIs, mentioned above) can only be granted for the performance of agency-assigned work, part 451 of title 5 of the CFR does not preclude agencies from issuing awards to employees for activities performed while on official time, such as contributions made to the accomplishments of partnership councils. However, FLRA's General Counsel, in a memorandum to FLRA's Regional Directors on employee-management work groups, has taken the position that employees cannot be evaluated, disciplined, or rewarded for activities undertaken in their capacity as union representatives performing representational functions. It thus appears that agencies act at their peril and run the risk of committing an unfair labor practice if they give any kind of "reward" to employees for activities engaged in while acting as representatives of the union. Finally, neither law nor OPM's regulations require that only ratings of record be used in evaluating candidates for promotion.
The following, apart from 46 F 116, are summaries of performance-related case law on proposals dealing with the treatment of employees serving as union officials:
46 F 116 (activity committed a ULP when it reduced the amount of gainsharing awards to two employees by the amount of time they had spent on representational functions).
43 F 117, #17 (proposal under which a union representative, when the use of official time impedes the timely performance of the union representative's agency-assigned duties, can request that such work be reassigned, is a negotiable § 7106(b)(2) procedure. "[T]he Agency would retain the authority to decide whether to grant the request because work otherwise could not be performed timely, or to disapprove the request. . . . Additionally, we find nothing in the proposal that would require the Agency to grant official time when a Union representative requests the reassignment of work."
42 F 88, #1 (requiring that the position description of a union official on 100% official time be changed to show that he performs the duties of a union president in order to generate critical elements and performance standards permitting performance appraisal is nonnegotiable because inconsistent with 5 U.S.C. § 4302). In 42 F 88, FLRA said the following:
Based on our reading of 5 U.S.C. Chapter 43 and its implementing regulations, . . . we conclude that . . . job performance may not encompass duties and responsibilities performed on official time on behalf of a labor organization. Instead, we find it clear that such job performance is intended to encompass an employee's performance of agency-assigned duties and responsibilities. . . . Union duties are not assigned by the Agency. See generally Bureau of Alcohol, Tobacco and Firearms v. FLRA, 464 U.S. 89, 105 (1983) ("Congress did not provide that employees engaged in collective bargaining are acting in their 'official capacity,' 'on the job,' or in a 'duty status.'")
42 F 88, #2 (requiring the establishment of critical elements and performance standards pertaining to the duties of the union president are nonnegotiable. "As the Union president performs Union duties only, and as 5 U.S.C. § 4302 requires that elements and standards encompass only Agency-assigned duties, we find that the establishment of performance standards and critical elements for the duties encompassed by Proposal 2 is inconsistent with 5 U.S.C. § 4302.")
42 F 88, #3 (providing for performance awards for the performance of union duties is NN because inconsistent with 5 U.S.C. § 4302).
42 F 88, #4 (requiring that the career ladder of the union president be extended to GS-15 is NN because it doesn't deal with a condition of employment. "Proposal 4 concerns the classification of a position, within the meaning of section 7103(a)(14)(B) of the Statute and, therefore, does not concern a condition of employment.")
Presumptive ratings. 42 F 78, #32 (requiring that any presumptive rating be at least equal to the employee's last rating is nonnegotiable because inconsistent with 5 CFR 430.206(e), which requires that the appraisal period be extended for the time necessary to meet the minimum appraisal period). See 5 CFR 430.208(g) for new regulation's ban on "presumptive" or "assumed" performance ratings.
41 F 72, ##2 & 3 (provisions establishing an adjustment period for union officials returning to full time agency work, during which the returning union official may not be formally evaluated, are nonnegotiable because they excessively interfere with the rights to assign work and direct employees. "[T]hese provisions would prevent the Agency even from holding an employee accountable for work defects that are not attributable to circumstances caused by the employee having spent a significant amount of time on protected activity." FLRA refers to 40 F 53, #1, sections B-E, as an example of a negotiable accommodation.
40 F 53, #1 (requiring the agency to modify the critical elements and performance standards established for employees serving as union representatives so as to accommodate their use of official time is a negotiable appropriate arrangement. So, too, are sections B through E, requiring, among other things, that time spent on union representational functions not be considered as a negative factor when evaluating performance elements.
[T]he burden placed on the Agency and the Agency's exercise of its management rights by Proposal 1 is minimal. The proposal seeks to protect employees engaged in representational activities against performance evaluations which fail to take into consideration a limitation on their ability to meet the performance standards for their position which results from use of authorized official time, annual leave, or leave without pay. The proposal does not seek to protect employees against the consequences of poor performance. . . . Similarly, the proposal does not dictate or mandate that employee Union representatives receive any particular performance rating.
40 F 53, #2 (requiring management to take into account mitigating factors such as lack of training, availability of resources, frequent interruptions, etc., in rating an employee is a negotiable appropriate arrangement.
The proposal applies only to matters over which an employee has no control and only to the extent that the mitigating factors are involved in an employee's performance. Management has, or retains, the prerogative to ensure that resources are available to employees, that adequate training is provided to them, and that employees are not confronted with authorized interruptions of their work duties. Moreover, the proposal does not dictate . . . what its performance standards . . . or performance ratings should be.
If the agency "takes into account" the various factors, it "is free to reach any conclusion which is otherwise justified in evaluating an employee.")
39 F 62, #1 (exempting union officials who spend 80 or more hours bank time in a two-quarter rating period from a "measured" evaluation excessively interferes with management s rights. The proposal would force management to rely solely on subjective criteria for the periods in question. Since current performance standards establish both objective and subjective criteria, the provision would have modified the content of performance standards in the specified circumstances. Although the provision is intended to be an "arrangement," it isn't "appropriate" because "[t]he provision does not allow for exceptions in situations where an accurate measured evaluation could be obtained").
39 F 25, #3 (listing activities, such as union representational functions and collateral EEO counseling duties, that may not adversely affect an employee's timeliness or production requirements is nonnegotiable. "[T]he provision would require that employees be absolved of accountability and responsibility for their work performance where the performance has been affected by other duties.") (The apparent inconsistency between this holding with other cases in this section involving similar proposals is probably due to the fact that the union in this case did not contend that the proposal is an "appropriate arrangement" exception to management's rights.)
34 F 145 (requiring the agency to give employees on 100% official time a performance rating of fully successful or higher depending on the average rating of other employees within the same job description is NN because inconsistent with 5 C.F.R. § 430.206(e)). 28 F 89, #14 (requiring that there be separate performance standards for employees who spend less than 45% of their productive time on agency-assigned work is NN because the proposal interferes with management's rights to direct employees and assign work.)
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Conclusion
Although the case law on performance management is probably more plentiful than in any other area of personnel management, there have been many twists and turns in its development, which may prompt the researcher to feel that he or she is entering a labyrinth. For example, much of the case law before OEA v. FLRA, 876 F.2d 960 (D.C. Cir. May 25, 1989) didn't involve the application of the excessive interference balancing test because FLRA didn't think the issuance of performance standards had an adverse effect. The aforementioned court decision forced it to take a different approach.
Another example of a court decision that forced a major change of direction in the case law is NTEU v. FLRA, 793 F.2d 371 (D.C. Cir. 1986), in which the D.C. Circuit held that the rights to direct employees and assign work do not, by themselves, encompass the right to reward performance. That decision will become particularly important, now that OPM's regulations no longer subject performance awards to higher level review and approval.
See, also, the D.C. Circuit's decision on "tailoring" in NLRB v. FLRA, No. 91-1608 (D.C. Cir. August 31, 1993), in determining whether a proposal constitutes an "arrangement" to which the excessive interference balancing test may appropriately be applied to determine negotiability. Because 48 F 40 was the first case issued after that court decision, appropriate arrangement decisions before 8/31/93 may be subject to a "tailoring" challenge.
It is to be emphasized that this bulletin is a rough guide to the case law, not a substitute for it. Brief summaries of complicated proposals are necessarily subjective and rarely report the Authority's reasoning and almost never why FLRA rejected certain arguments in reaching its conclusion, which often are more revealing of FLRA's reasoning than the reasons it gives to support its conclusion. The reader should therefore use this bulletin as a kind of annotated index of the case law and always confirm the summaries by reading the actual decisions before taking any positions on similar or related proposals that crop up in negotiations. And since case law is always changing, one should check to see whether any decisions issued since the publication of this bulletin have any bearing on the proposals under consideration.
7/28/99 note: We call the reader's attention to a couple of cases decided after this guidance was published. As we noted when discussing performance awards (see Section IX), the basis for finding mandatory performance award proposals nonnegotiable was NOT because they interfered with a management right, but because they were inconsistent with OPM's requirement that there be higher level review of such awards. However, in 52 FLRA No. 117, the Authority, noting that OPM s new regulations no longer had a higher level review requirement, found performance awards proposals negotiable.
A second case relating to performance that should be mentioned is the Authority's holding in 55 FLRA No. 73, that a proposal prescribing the number of performance levels did not deal with a matter dealing with methods and means within the meaning of section 7106(b)(1). The proposal was found to be nonnegotiable because it impermissively affects management's rights --specifically, the rights to direct and to assign work.
Questions or comments on this page should be directed to the U.S. Office of Personnel Management, Theodore Roosevelt Building, 1900 E Street, NW., Washington, DC 20415-2000, telephone (202) 606-2930; fax (202) 606-2613; or email cwrap@opm.gov.
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