Department of Treasury, Internal Revenue Service v. Federal Labor Relations Authority

PETITIONER: Department of Treasury, Internal Revenue Service
RESPONDENT: Federal Labor Relations Authority
LOCATION: Maple Heights High School

DOCKET NO.: 88-2123
DECIDED BY: Rehnquist Court (1988-1990)
LOWER COURT: United States Court of Appeals for the District of Columbia Circuit

CITATION: 494 US 922 (1990)
ARGUED: Jan 08, 1990
DECIDED: Apr 17, 1990

David L. Shapiro - on behalf of the Petitioner
Gregory O'Duden - on behalf of the Respondent National Treasury Employees Union
Robert J. Englehart - on behalf of the Respondent Federal Labor Relations Authority

Facts of the case


Media for Department of Treasury, Internal Revenue Service v. Federal Labor Relations Authority

Audio Transcription for Oral Argument - January 08, 1990 in Department of Treasury, Internal Revenue Service v. Federal Labor Relations Authority

William H. Rehnquist:

We'll hear argument first this morning in Number 88-2123, the Department of the Treasury, Internal Revenue Service v. Federal Labor Relations Authority.

Mr. Shapiro.

David L. Shapiro:

Thank you, Mr. Chief Justice, and may it please the Court:

The question in this case is whether a Federal agency can be required to bargain over a union proposal that would subject certain agency decisions with respect to the contracting out of agency work to the grievance procedure of the collective bargaining agreement and to third-party arbitration.

The agency position, that is, the position of the Internal Revenue Service in this case, has been that it cannot be required to bargain over this proposal, that indeed, bargaining over the proposal is precluded by the management rights provision of the Federal Labor Management Relations statute.

The union proposal in this case is related to Circular A-76, issued by the Office of Management and Budget, which is an arm of the Executive Office of the President.

Circular A-76 was originally issued in the early... in the 1950s and has been amended a number of times ever since.

It is a statement of executive policy on the important matter of Federal procurement.

It deals in some detail with the circumstances under which the particular work shall be done inside the agency or shall be contracted out.

The Circular specifically states not only that it is designed to give administrative direction to heads of agencies, but, and I quote, that it

"shall not establish and shall not be construed to create any substantive or procedural basis for anyone to challenge any agency action or inaction on the basis that it was not in accordance with the Circular, except as specifically provided in the Circular itself. "

The Circular then goes on--

Antonin Scalia:

Excuse me.

That last point is really not essential to your principal argument here, though, is it?

Even if it had... even if it had not included that provision, even if you were allowed to imply that there might be some binding effect in the courts, your main argument would be unaffected, wouldn't it?

David L. Shapiro:

--Well, the core of our argument, Your Honor, is that Circular A-76 is not an applicable law within the meaning of the management rights provision.

So that if Circular A-76 did confer third-party rights that would be enforceable in court, then that threshold aspect of our argument would be crossed, and you would come to the latter part of our argument that the subject matter of the Circular is excluded from bargaining by Section 7117--

Antonin Scalia:

xxx to be the principal part of your argument.

David L. Shapiro:

--No, it's really... I believe it's a subsidiary part.

We reach it really only at the latter point of our brief.

The focus of our argument is really that Circular A-76 is not an applicable law.

We do make both arguments.

Sandra Day O'Connor:

Well, Mr. Shapiro, I guess you come close to conceding that the Circular is a governmentwide rule or regulation for purpose of Section 7117.

David L. Shapiro:

Yes, we do, Your Honor, although we think that question need be reached only if the Court determines that it is an applicable law under 7106.

We do believe, however, that there is a considerable difference between the scope, purpose and language of 7117 on the one hand and the scope and language of 7106 on the other.

Sandra Day O'Connor:

Well, it strikes one as a little odd that Congress intended a different meaning for purposes of 7103 than it did in 7117.

David L. Shapiro:

There are three relevant provisions of this statute, Your Honor.

There is the definition of a grievance, in Section 7103, which refers very broadly to any complaint of any violation of a law, rule or regulation.

There is Section 7117, which excludes from the scope of bargaining any proposal that is inconsistent with any governmentwide rule or regulation.

Now, it may be that the concept of a rule in those two provisions is the same.