Successful Challenge to FLRA Decision that Allowed Agencies to Cancel Contract Provisions Despite Parties’ Previous Agreement to Keep the Contract in Place
SUMMARY: The D.C. Circuit has set aside an FLRA decision allowing for agency head review on contracts automatically extended by previous agreement of the parties. Agencies can no longer unilaterally cancel contract provisions when the parties have agreed in advance to continue a contract beyond the original expiration date. This strengthens NTEU’s ability to keep contracts fully in place, preserving employee rights and overall stability, until a new agreement is executed.
Today, the U.S. Court of Appeals for the D.C. Circuit set aside an FLRA policy statement allowing agencies to unilaterally cancel contract provisions when a contract is automatically extended through an advance agreement of the parties. That FLRA ruling held that agencies could conduct agency head review and implement new regulations within 30 days of a mutually agreed-upon automatic extension to allow negotiation of a successor agreement. See chapter presidents’ memorandum dated October 1, 2020.
Under a “continuance provision,” a contract stays in full force and effect until a new agreement is executed, even after the original expiration date passes. Applicable laws prohibit agencies from implementing new, conflicting rules and regulations while contracts are in effect. Continuance provisions are optional and are agreed upon by the parties in advance.
In September 2020, the FLRA stated, for the first time, that agencies could conduct agency head review upon the automatic extension of contracts through continuance provisions. In other words, agencies could review an existing contract for compliance with new rules and regulations even when the parties agreed in advance to extend the contract. The FLRA’s decision allowed premature agency head review—and implementation of new rules and regulations—in violation of governing law. Accordingly, a coalition of unions led by NTEU challenged the decision in court. See chapter presidents’ memorandum dated October 1, 2020.
Agreeing with the unions’ arguments, a unanimous, three-judge panel found that the FLRA’s policy statement conflicted with the federal labor relations statute. Because of this conflict, the court set the policy statement aside. This is the third time in the past year that NTEU and its fellow unions have successfully challenged unreasoned, erroneous FLRA policy statements in court.
Because of this victory, agencies are once again prohibited from prematurely implementing conflicting rules and regulations upon the automatic extension of a contract. Agencies and unions will continue to benefit from the stability they bargain for when they agree on these automatic extensions. Consistent with governing law, new, conflicting regulations will be incorporated into new agreements instead of being unilaterally implemented by the government as soon as the original expiration date arrives. Accordingly, federal unions like NTEU and their members will be better positioned to bargain on new regulations as part of more comprehensive negotiations.
I am proud that, once again, NTEU led the fight against the FLRA’s unreasonable and unsupported attacks on employees’ bargaining rights. Our effective advocacy in court convinced all three judges that the FLRA’s interpretation of governing law was wrong, despite the deference that the Authority receives when it interprets the federal labor relations statute.
A copy of the D.C. Circuit’s opinion is attached. If you have questions about the court’s decision, you may contact Assistant Counsel Kathryn Bailey via email at email@example.com.
Anthony M. Reardon