[00:00:00] Speaker 00: Case number 20-1398 et al. [00:00:03] Speaker 00: American Federation of Government Employees AFL-CIO Petitioner versus Federal Labor Relations Authority. [00:00:10] Speaker 00: Mr. Shah for the petitioners. [00:00:11] Speaker 00: Mr. Peters for the respondents. [00:00:14] Speaker 02: Good morning, counsel. [00:00:16] Speaker 02: Mr. Shah, please proceed when you're ready. [00:00:19] Speaker 06: Good morning and may it please the court. [00:00:21] Speaker 06: I'm Parish on behalf of the petitioners. [00:00:24] Speaker 06: In a one paragraph analysis, a two to one majority of the Federal Labor Relations Authority reversed over 33 years of precedent and eliminated the statutory right to union initiated midterm bargaining. [00:00:37] Speaker 06: It relied upon the absence of that statutory right to then hold for the first time that a zipper clause proposal is a mandatory subject of bargaining and may thus be bargained to impasse and potentially imposed into a term agreement over the union's objections. [00:00:53] Speaker 06: For three reasons, the authority's threshold ruling on the midterm bargaining right was arbitrary and capricious. [00:01:00] Speaker 06: First, the authority failed to reasonably explain its departure from its decision in Interior. [00:01:06] Speaker 06: Second, the authority failed to address important aspects of this statutory question before arriving at its conclusion. [00:01:14] Speaker 06: And third, the authority failed to reasonably explain its departure from its decision in OPM. [00:01:22] Speaker 06: bargaining right is reversed. [00:01:24] Speaker 06: The zipper clause ruling that explicitly relies upon it must also be set aside. [00:01:28] Speaker 06: That ruling could not be sustained on the authority's rationalness decision, which depended upon the absence of the midterm bargaining right. [00:01:37] Speaker 06: On the first point, the authority failed to reasonably explain this departure from interior [00:01:43] Speaker 05: But Mr. Shah, you talk about the failure to explain a departure, but under the Supreme Court's decision in FCC versus Fox, there isn't a special higher bar to explain a change in policy. [00:01:59] Speaker 05: The policy just has to be explained. [00:02:03] Speaker 05: It just has to be an awareness that the policy is being changed, which [00:02:07] Speaker 05: I believe the policy is explicit about that. [00:02:11] Speaker 05: And the new policy has to be explained. [00:02:13] Speaker 05: And your brief cited to older precedent that perhaps required more for a change in policy. [00:02:20] Speaker 05: But I just wonder whether you could speak to whether that line of argument in your briefing survives the Fox recalibration. [00:02:29] Speaker 06: Yes, your honor. [00:02:30] Speaker 06: This court held as recently as 2020. [00:02:32] Speaker 06: That reason decision making requires that when departing from precedent, an agency must offer a reason to distinguish that precedent or explain its apparent rejection of that precedent's approach. [00:02:44] Speaker 06: And it's the latter that didn't happen here. [00:02:46] Speaker 06: The singular reason that the authority gave for rejecting the approach in Interior, that single reason simply cannot withstand scrutiny. [00:02:56] Speaker 06: In Interior, [00:02:58] Speaker 06: The authority stated that Congress's findings in Section 7101A regarding collective bargaining were as applicable to midterm bargaining as term bargaining. [00:03:07] Speaker 06: and that nothing in the statute's text supported a contrary conclusion. [00:03:11] Speaker 06: In the decision below, the authority reframed that observation slightly. [00:03:16] Speaker 06: It stated that Interior concluded that the statute's text does not distinguish between obligations for term and midterm bargaining. [00:03:22] Speaker 06: And then it went on to call that view flawed, even though it's a textually accurate view that's shared by the Supreme Court. [00:03:31] Speaker 06: It went on to say that the statute's text at 7114A4 clearly established as term bargaining, but not midterm bargaining. [00:03:39] Speaker 06: But as the Supreme Court stated, that provision and other sections of the statute speak only to collective bargaining without distinguishing between types. [00:03:47] Speaker 06: And that provision in particular could easily be read in the view of the Supreme Court to encompass midterm bargaining. [00:03:54] Speaker 06: The authority offered no other reason for its departure from Interior. [00:03:58] Speaker 06: And it ignored the primary bases of Interior's holding, [00:04:01] Speaker 06: which were Congress's findings in section 71-01A in the statute's undisputed aims of strengthening unions and equalizing the balance of power at the bargaining table. [00:04:13] Speaker 05: If we were to agree with you, Mr. Shah, that the policy statement does not do enough to explain why it takes a different view from the view in interior, as I read your brief, you think that [00:04:31] Speaker 05: alone would establish that zipper clauses are permissive rather than mandatory subject of bargaining. [00:04:38] Speaker 05: Is that your position? [00:04:40] Speaker 06: Your honor, our position is that if the authority's ruling on the midterm bargaining right is set aside, that ruling is the foundation for the authority's subsequent conclusion on the zipper clause issue. [00:04:54] Speaker 05: I'm sorry, I think I missed your last phrase there. [00:05:00] Speaker 06: Your Honor, I was just saying that the authorities zipper clause ruling, it depends upon its, its midterm bargaining right ruling in particular the absence of that midterm bargaining right. [00:05:12] Speaker 05: But the standard for the existence of the midterm bargaining right is, it seems to me as I read our cases, lower than the standard for establishing a permissive bargaining subject. [00:05:26] Speaker 05: Under the NTEU decision of our court from 2005, we adopted a standard that requires that a [00:05:34] Speaker 05: right that is going to be a permissive subject of bargaining must be established explicitly or by unambiguous implication in the in the statute and that's not a standard that you grappled with in your brief and I'm just [00:05:48] Speaker 05: I'm just curious what I'm missing. [00:05:50] Speaker 05: It just seems to me that there are sort of two tiers. [00:05:54] Speaker 05: One is, is there a right as a kind of default matter, which is the question that Interior addressed. [00:05:59] Speaker 05: And then the separate question, which I think I'll acknowledge was not resolved, is the question whether something like a zipper clause is a permissive or mandatory subject of bargaining. [00:06:13] Speaker 06: Your Honor accurately states the standard and the two different tiers. [00:06:17] Speaker 06: Our argument here is that, you know, viewing the authority's rationale below, looking only at that rationale, [00:06:27] Speaker 06: the unilateral rights analysis that the authority performs, and I believe one to two sentences, it depends upon the absence of the midterm bargaining right. [00:06:37] Speaker 06: So if that ruling is set aside and the right is restored, there is no longer a basis for that zipper clause ruling. [00:06:45] Speaker 02: And what is that? [00:06:47] Speaker 02: If that right is restored, you're saying that right means that you have a new unilateral entitlement, which means that it's a permissive subject. [00:06:55] Speaker 02: Is that right? [00:06:56] Speaker 06: Your honor, we do make that case in the brief that the midterm bargaining right would be a unilateral right. [00:07:03] Speaker 06: But what's critical here is the court doesn't need to reach that question and undergo that unilateral rights analysis itself. [00:07:10] Speaker 06: It is sufficient here that the authority in this decision, its rationale for its unilateral rights analysis is on its face deficient. [00:07:18] Speaker 02: But you think that it follows that it's a unilateral right [00:07:22] Speaker 02: as the night follows the day. [00:07:24] Speaker 02: I think that's the logic of your argument, and that may well be right, but it seems like you're tying the two things together so that if there's an overturning, that that necessarily reinstates a regime under which, as you understand it, there's a unilateral entitlement on the part of the unions. [00:07:42] Speaker 06: What we are arguing is if the midterm bargaining ruling is set aside, the basis for the authority's zipper clause ruling likewise falls. [00:07:52] Speaker 06: And the result of that would be the previous regime where there was a right that unions had to bargain, to initiate midterm bargaining that would- A unilateral right. [00:08:06] Speaker 02: So I have one question about that, which is if you tie, if I can just finish this out, if you tie the [00:08:12] Speaker 02: the Zipper Clause analysis to the threshold question in the way you're conceiving of it, then in the authorities order that's under review, they also have some explanation about the Zipper Clause. [00:08:30] Speaker 02: And that's at page J77, there's a paragraph about the Zipper Clause issue. [00:08:35] Speaker 02: And isn't the flip side of your argument then that what the authority says about the zipper clause can also be used as a basis for explaining why there's a departure from interior? [00:08:45] Speaker 02: Because it seems to me what you're doing is you're saying, all we look at is this one paragraph with this one textual point, and we just disregard everything else because everything else has to do with some other subject, the zipper clause. [00:08:56] Speaker 02: But then your own argument is that the two are intimately tied. [00:08:59] Speaker 02: So why wouldn't the explanation of the Zipper Clause also feed back into the explanation of why there's been an adjustment from a departure from Interior? [00:09:09] Speaker 06: So two things there, Your Honor. [00:09:10] Speaker 06: I certainly agree there is a relationship between those two rulings and those two issues. [00:09:14] Speaker 06: But if you look at that paragraph on the Zipper Clause, that the few sentences of analysis that are there, it simply refers back to the midterm bargaining analysis. [00:09:23] Speaker 06: It simply says, because of its elimination of the midterm bargaining right, neither party would have to waive a statutory right. [00:09:32] Speaker 06: Therefore, there's not an issue in terms of having a Zipper Clause proposal be a mandatory subject of bargaining. [00:09:40] Speaker 05: Let me just. [00:09:41] Speaker 05: I'm sorry. [00:09:42] Speaker 05: No, no, no. [00:09:42] Speaker 05: Finish up. [00:09:44] Speaker 02: OK, one more, Judge Filler. [00:09:45] Speaker 02: My apologies. [00:09:47] Speaker 02: So in that paragraph, though, on the Zipper Clause paragraph, [00:09:51] Speaker 02: It traces back, but then there's an explanation of why in the authority's view, that would be a good thing for both parties. [00:09:59] Speaker 02: There's an explanation of here's how parties would react to that, and here's the sorts of things that parties would do. [00:10:04] Speaker 02: And I got the sense from that, that that's the authority's effort to explain why it thought this new regime is the better place to wind up. [00:10:14] Speaker 06: I believe you're referring to the authority's alternate basis for its zipper clause ruling, which deals with the phrase and section 71 14 a for regarding appropriate techniques for bargaining. [00:10:28] Speaker 02: Right, it's the more over paragraph on j 77. [00:10:32] Speaker 06: That's correct, Your Honor. [00:10:33] Speaker 06: We view that paragraph as, and I believe this is accurate, an alternate basis for the authority's zipper clause ruling. [00:10:42] Speaker 06: One that's entirely unreasoned. [00:10:44] Speaker 06: It's so vague, it's hard to even understand what the upshot is. [00:10:49] Speaker 06: I don't believe that ties back to the ruling on the midterm bargaining right. [00:10:59] Speaker 06: It's an independent basis. [00:11:01] Speaker 02: And why wouldn't it, why if it's an independent basis, even if it's an independent basis under your conception of it, if the zipper clause issue is intimately tied to the threshold question in your schematic, then why wouldn't that also be a basis for explaining why there's a departure from interior? [00:11:19] Speaker 02: Is it just that you think standing alone is unreasoned and so we should disregard it at all? [00:11:23] Speaker 02: Or do you think conceptually it doesn't work to factor that into whether there's been an adequate explanation of the departure? [00:11:29] Speaker 06: both of those things, Your Honor. [00:11:30] Speaker 06: One, it is entirely unreasonable as we discussed in our brief. [00:11:35] Speaker 06: Second, I do not believe this paragraph speaks to Interior at all, either explicitly or implicitly. [00:11:44] Speaker 06: And so for those two reasons, I don't think that this paragraph would help the authority explain this departure from Interior. [00:11:54] Speaker 05: Your Honor. [00:11:55] Speaker 05: I just wanted to clarify, you had answered a question from the Chief Judge about the two issues rising and falling together. [00:12:06] Speaker 05: And I had thought when you were answering a question from me that, A, you acknowledged that there are two separate standards, the standard for establishing the midterm bargaining right. [00:12:18] Speaker 05: that was established in the interior is not as demanding as the standard for establishing a unilateral right that would be a permissive subject of bargaining. [00:12:27] Speaker 05: But that on this record, I thought your point was that on this record, given the way the authority tied the two together, if the [00:12:39] Speaker 05: authorities questioning of its prior holding and interior were to fall by the wayside, that given the way this opinion is reasoned, the Zipper Clause holding would also have to fall, but not that it's sort of more necessarily and generally that the one follows the other. [00:12:56] Speaker 05: Otherwise, I'm not understanding your acknowledgement that there are two separate standards and that the standard for establishing that a right is unilateral is more demanding. [00:13:07] Speaker 06: Your Honor, I'm sorry, the internet connection broke up a bit during your question. [00:13:12] Speaker 06: I heard all of it. [00:13:16] Speaker 06: But if I could just say, our baseline position is that [00:13:21] Speaker 06: It's one thing to establish a right, be it the statutory right or the unilateral right that's required on the zipper clause issue. [00:13:32] Speaker 06: Our position in this case is that it's the path that the authority took to its destination in each instance. [00:13:39] Speaker 06: With the midterm bargaining right, the reasoning that it put forth is simply insufficient to explain its departure, nor did it take into account important aspects of the statutory question before arriving at its conclusion. [00:13:50] Speaker 06: And that is why the midterm bargaining ruling cannot stand. [00:13:56] Speaker 06: Sorry, please go ahead. [00:13:58] Speaker 05: I didn't mean to interrupt you. [00:14:01] Speaker 06: And I was just going to add that looking narrowly at the authority's rationale and its decision for its super clause ruling, it does depend upon the absence of the midterm bargaining right. [00:14:15] Speaker 05: As the authority has framed it. [00:14:17] Speaker 05: So my follow-up question is just, [00:14:20] Speaker 05: Given the Supreme Court's decision in Local 1309 that the statute is ambiguous with respect to protection of the basic midterm bargaining right that the authority then following that decision recognized, how could it be that the statute unambiguously creates [00:14:48] Speaker 05: a right making the zipper clause issue permissive. [00:14:54] Speaker 06: Your honor, what I would say there is while the standard is [00:14:58] Speaker 06: for the unilateral right is it must be either explicit or vested by unambiguous implication. [00:15:04] Speaker 06: The limited case law applying that standard, and we're talking about two DC circuit cases referencing that standard, I believe only a couple of authority cases applying that standard. [00:15:18] Speaker 06: In terms of this application, it has not been formalistically applied. [00:15:22] Speaker 06: Both in our comments, [00:15:24] Speaker 06: As well as our briefs to this court, we discussed the authorities decision and FDA, which is a decision that this court discussed at length and it's 2005 and to the FLRA decision that case I believe shows that. [00:15:41] Speaker 06: Notwithstanding how that standard is phrased. [00:15:43] Speaker 06: It is rather, it has been pragmatically applied by the authority, the authority in its decision below, and is in its briefs to this court, it ignores that case. [00:15:55] Speaker 06: But again, I do believe that. [00:15:57] Speaker 06: Your Honor is looking strictly at the rationale below. [00:16:00] Speaker 06: Do not need to get into a unilateral rights analysis in the first instance. [00:16:05] Speaker 06: All right. [00:16:06] Speaker 05: Just one other question, which is the dissenting member made a point about reliance that a lot of existing bargaining agreements were bargained with the assumption that under interior there is a statutory right to midterm bargaining. [00:16:21] Speaker 05: And I was a little surprised. [00:16:24] Speaker 05: I don't see in your brief an argument [00:16:27] Speaker 05: Based on reliance and based on the authorities policy statement failure to take reliance into account am I missing something are you are you making an argument that reliance also counsels against the authorities decision to pitch the interior holding overboard. [00:16:47] Speaker 06: Your honor, I would agree with that conclusion. [00:16:49] Speaker 06: That's not an argument that we raised below or made in our briefs to this court. [00:16:55] Speaker 06: But this is certainly a sea change. [00:16:56] Speaker 06: 33 years of precedent out the window. [00:16:59] Speaker 06: And without question, that's something that changes the game for unions. [00:17:05] Speaker 06: It affects their standing in the workplace. [00:17:07] Speaker 06: Our members depend upon us to be able to bargain over new and unforeseen things that come up during the term of an agreement. [00:17:15] Speaker 04: Can I ask just one question? [00:17:17] Speaker 04: I want to make crystal clear. [00:17:18] Speaker 04: It sounds like from your argument, but I don't want to make any assumptions. [00:17:21] Speaker 04: Is the relevant world here divided into two exclusive categories, permissive rights? [00:17:32] Speaker 04: I'll call them permissive ones and unilateral slash mandatory bargaining rights. [00:17:36] Speaker 04: So permissive and unilateral. [00:17:38] Speaker 04: Is that the world, or is there a third option of something called a statutory right? [00:17:45] Speaker 04: that might provide like a default rule or something if something just doesn't come up in bargaining at all. [00:17:52] Speaker 06: Your honor, it is sort of the two worlds, mandatory and permissive. [00:17:58] Speaker 06: In terms of statutory rights, that is the larger umbrella under which there are unilateral rights and other statutory rights. [00:18:09] Speaker 02: Okay, unless my colleagues have further questions for you, Mr. Shah, we'll give you a little time for rebuttal. [00:18:15] Speaker 02: Why don't we hear from the authority Mr Peters. [00:18:18] Speaker 01: Thank you, may it please the court. [00:18:20] Speaker 01: Um, I think that the authority, the outcome on the unilateral rights point is more or less was more or less dictated and whether zipper clauses are mandatory. [00:18:34] Speaker 01: or permissive subject of bargaining was all but dictated by NTU 2005, which emphasizes that the dispositive question is not whether the proposal involves a statutory right, but whether that right is unilateral or not. [00:18:51] Speaker 01: And it emphasized, again, four different times that a unilateral right must be manifested in the statute either explicitly or by unambiguous implication [00:19:02] Speaker 01: The Supreme Court, the second part of that logical structure is the Supreme Court in the NFFE case said that it's not unambiguous. [00:19:11] Speaker 01: There's no unambiguously manifested right to midterm bargaining in the statute it reviewed the policy it reviewed the legislative history review the text, it said that it's ambiguous that that's the. [00:19:23] Speaker 01: holding. [00:19:23] Speaker 01: And then the so the conclusion from that has to be under NTU 2005, it has to be that zipper clauses are mandatory subjects of bargaining. [00:19:34] Speaker 04: And I think that we have to deal with the decision that the authority wrote here. [00:19:41] Speaker 04: And the first part of his decision was that it is necessary, necessary as the authorities were necessary to first address [00:19:51] Speaker 04: whether there's a statutory right to midterm bargaining under the statutes, right? [00:19:58] Speaker 04: Before it could even get to that separate clause question. [00:20:00] Speaker 04: You're kind of making an argument that it sounded to me like we can ignore the first half of the authority opinion and just look at the second half, but they found the one necessary to getting to the other. [00:20:11] Speaker 04: You agree with that, right? [00:20:13] Speaker 04: That was the language? [00:20:15] Speaker 01: Well, it was necessary for the authority to analyze the scope of the midterm bargaining, right? [00:20:22] Speaker 01: Because NTU 2005 makes it mandatory to analyze midterm bargaining, right? [00:20:28] Speaker 01: To look at that, you have to look at whether the right is established in the statute unambiguously. [00:20:35] Speaker 04: OK. [00:20:36] Speaker 04: And then the only reason given for [00:20:41] Speaker 04: that I discern for rejecting the existence of a midterm bargaining right in its own right, in its own way that exists independently on whether it's negotiated in or out of the contract. [00:20:55] Speaker 04: So the only basis for rejecting that was where the rationale said it's flawed. [00:21:02] Speaker 04: The authority found that the statute does not distinguish between obligations for midterm and term bargaining. [00:21:12] Speaker 04: Can you tell me where they said that? [00:21:15] Speaker 01: Well, the authority engaged in the unilateral rights analysis on page J76 when they noted that the statute presumes that all matters related to conditions of employment are mandatory subjects of bargaining unless the tax explicitly or by unambiguous implication vested a party on qualified or unilateral right. [00:21:36] Speaker 01: As explained above, the statute does not. [00:21:39] Speaker 04: No, no, no, no, I'm sorry. [00:21:40] Speaker 04: I wasn't clear in my question. [00:21:42] Speaker 04: The rationale for jettisoning [00:21:45] Speaker 04: as many decades of recognizing this under the statute, the right to midterm bargaining was this sentence. [00:21:54] Speaker 04: Two sentences, the authority's first consideration to support that conclusion is flawed. [00:22:00] Speaker 04: The authority found that the statute does not distinguish between obligations for midterm and term bargaining. [00:22:08] Speaker 04: And can you tell me where in that the interior FLRA decision, they said the statute does not distinguish between obligations for midterm and term bargaining? [00:22:23] Speaker 01: Well, that was the beginning of the discussion in interior, started with the text and it noted that the text does not distinguish between midterm bargaining and term bargaining. [00:22:40] Speaker 01: And that was the starting point of the analysis. [00:22:44] Speaker 01: So for purposes of the zipper clause issue, interiors- Wait, where does it say that? [00:22:50] Speaker 04: They cite page 51. [00:22:54] Speaker 04: I guess I'm not reading them saying that it's unclear as to either. [00:23:00] Speaker 04: It's unclear as to both. [00:23:01] Speaker 04: What they say is many of the rationales that lay the groundwork for term bargaining or what's presumed to be term bargaining in the statutory scheme apply are equally applicable or as applicable as a term to midterm bargaining. [00:23:18] Speaker 04: That's not the same thing as saying [00:23:21] Speaker 04: I'm just confused as to what this rationale is. [00:23:25] Speaker 04: Statute does not distinguish between obligations. [00:23:28] Speaker 04: I mean, what they're saying is the statutory tax, when everyone knows going into it, it was ambiguous as to midterm bargaining, at least in the Supreme Court's Chevron sense of that phrase. [00:23:44] Speaker 04: Everyone knew that going in. [00:23:46] Speaker 04: No one was disputing that. [00:23:49] Speaker 04: But they've given a reason here, and I don't see in the opinion them saying the statute doesn't distinguish between midterm and term bargaining, as opposed to, wow, we looked at all the stuff that's in the statute, and many of those rationales that are there seem to apply equally to midterm bargaining. [00:24:09] Speaker 04: That's a very different proposition than what the authority assigned, unless I'm misunderstanding something. [00:24:15] Speaker 01: Right. [00:24:15] Speaker 01: Well, I think the authority noted that it stated that all matters relating to conditions of employment are mandatory subjects unless the text explicitly or by an ambiguous implication. [00:24:29] Speaker 04: Are you talking again about the zipper clause analysis on page 76? [00:24:35] Speaker 01: Yes, I see. [00:24:36] Speaker 04: I'm trying to keep you focused on page 75, though. [00:24:39] Speaker 04: And they're all they're giving is something that was an error in the FLRA decision, the prior interior FLRA decision. [00:24:50] Speaker 01: Right, that discussion is geared towards determining whether interiors and policies establishes [00:24:56] Speaker 01: Zipper clauses as a permissive only subject of bargaining based on the argument that that there's an unambiguously stated right or a unilateral right to engage in midterm bargaining. [00:25:09] Speaker 04: Wait, so you're saying this paragraph here is all explaining why [00:25:14] Speaker 04: Zipper clauses are a subject of bargaining? [00:25:18] Speaker 01: Yes. [00:25:19] Speaker 04: That's not what the authority said. [00:25:21] Speaker 04: They said we have to do this in two steps. [00:25:23] Speaker 04: First, we have to address, and I thought you had agreed with me, it was necessary first to address whether there is this midterm right to bargaining under the statute. [00:25:37] Speaker 01: Right. [00:25:38] Speaker 01: Well, I think the authority explained in footnote 35 that in their requested issue here, the question of the party's obligations to negotiate zipper clauses has been squarely raised. [00:25:49] Speaker 01: And because those obligations depend in some respects on whether the statute itself compels midterm bargaining, we find it necessary to address the midterm bargaining requirements in order to properly evaluate whether zipper clauses are mandatory subjects of bargaining. [00:26:03] Speaker 01: So we know that this discussion in that paragraph is geared towards the zipper clause holding and we know that also because the authority said several times, we find that zipper clauses are mandatory subjects of bargaining we find that all matters related to midterm bargaining obligations. [00:26:20] Speaker 01: are mandatory subjects of bargaining. [00:26:22] Speaker 01: That was the authority's holding in this case. [00:26:24] Speaker 01: I don't think that there is any broader holding here other than all matters related to midterm bargaining obligations are mandatory subjects of bargaining, not permissive subjects. [00:26:37] Speaker 01: Any issues relating to other situations, as the authority noted. [00:26:42] Speaker 04: How would they have to even address the status of midterm, the nature of midterm [00:26:49] Speaker 04: bargaining under the statute in order to hold that whatever it is, it's not expressed in the statute. [00:26:57] Speaker 04: Supreme Court already answered that question. [00:26:59] Speaker 04: Nor is it unambiguously implicated in the statute. [00:27:02] Speaker 04: The Supreme Court already said it's ambiguous. [00:27:05] Speaker 04: So why did they have to say anything more like attacking and walking away from the interior decision like they do on page 75? [00:27:16] Speaker 04: Why was that even necessary? [00:27:18] Speaker 01: Under the theory you're giving. [00:27:21] Speaker 01: Right. [00:27:22] Speaker 01: Well, the reason was because in the comment, NTU's comment, they argued that Interior had established midterm bargaining as a unilateral right. [00:27:33] Speaker 01: And so the authority is beginning by noting that Interior does not establish that midterm bargaining is a unilateral right explicitly. [00:27:43] Speaker 04: Why did they have to say there was something flawed in the Interior decision? [00:27:48] Speaker 01: I mean, that was the formulation. [00:27:52] Speaker 01: I mean, it's flawed in so far as it would suggest that zipper clauses are permissive subjects only, right? [00:28:00] Speaker 04: That decision didn't address zipper clauses. [00:28:03] Speaker 04: I thought everyone agreed that they didn't talk about zipper clauses there. [00:28:06] Speaker 04: So why is it flawed? [00:28:08] Speaker 04: They call it flawed for a particular reason that just doesn't seem to bear out. [00:28:13] Speaker 04: Right. [00:28:13] Speaker 04: Well, to the actual interior decision. [00:28:15] Speaker 01: To the extent that interior can be read to establish that there's an unambiguous right to midterm bargaining, the statute, it's flawed. [00:28:26] Speaker 05: Mr. Peters, I'm understanding you in your argument, and also this was my impression from the brief, that the policy statement [00:28:41] Speaker 05: to the extent the policy statement purported to overturn interior, you are no longer defending that. [00:28:47] Speaker 01: I think that issues related to whether there's a third position here, whether maybe it's not a unilateral right, but maybe there are circumstances where parties are required to bargain midterm, even absent a re-opener clause, absent, et cetera, et cetera. [00:29:07] Speaker 01: I don't think that this policy statement addresses issues other than whether zipper clauses are mandatory subjects of bargaining. [00:29:15] Speaker 05: Oh, no, that's not the way it reads at all. [00:29:18] Speaker 05: It reads first, we overturn interior. [00:29:22] Speaker 05: Second, on that basis, we hold zipper clauses are mandatory subjects of bargaining. [00:29:29] Speaker 05: And my question is just to the extent that [00:29:32] Speaker 05: that it reads that way. [00:29:34] Speaker 05: And maybe you disagree that it does, but if one were to reasonably read it that way, are you now saying, no, no, we never intended to dislodge interior. [00:29:44] Speaker 05: All we intended to do was differentiate because there's a higher standard under NTEU 2005, the question whether zipper clauses are a mandatory or permissive subject of bargaining and to establish that they're mandatory. [00:30:00] Speaker 05: That's your position here today? [00:30:02] Speaker 01: Yeah, my position is that, our position is that yes, this is geared towards determining whether zipper clauses are mandatory or permissive subjects of bargaining. [00:30:15] Speaker 01: That was all that was resolved by this. [00:30:16] Speaker 02: It's ultimately geared towards that. [00:30:19] Speaker 02: That's what you ultimately wanted to do, but along the way, it just seems like the whole setup of the analysis is that it, [00:30:25] Speaker 02: And as necessary predicate in the way that the authority set up its analysis is to address the question about midterm bargaining, not just about zipper clauses, but about the status of midterm bargaining. [00:30:37] Speaker 02: Isn't that the entire architecture of the decision? [00:30:40] Speaker 01: Um, the, I think that the, the architecture of the decision is that the authority look to midterm bargaining obligations in general, in order to to determine whether they precluded the holding that zipper causes are a mandatory subject of bargaining that was. [00:30:58] Speaker 01: what this analysis was geared towards. [00:31:00] Speaker 01: I think that as far as other issues relating to, as the authority noted in a footnote, other issues related that this policy statement doesn't address can address the full scope of midterm bargaining issues that might arise under the statute. [00:31:18] Speaker 01: And it doesn't address every context. [00:31:20] Speaker 01: And it notes that an issue arising [00:31:25] Speaker 01: where there is no re-opener clause, the matter isn't covered by an agreement, et cetera, et cetera, that it would only arise under, you know, specific circumstances. [00:31:38] Speaker 04: Can I ask this sentence on 75? [00:31:41] Speaker 04: We find after identifying what they consider a flaw in interior, the interior decision, they say [00:31:51] Speaker 04: we find it more appropriate to recognize that the statute neither requires nor prohibits midterm bargaining. [00:31:59] Speaker 04: Now that sentence, is that sentence replacing interior, the interior holding? [00:32:06] Speaker 01: I think that's a statement of where the authority of the general rule that the authority is creating is that this- Of course it is. [00:32:14] Speaker 04: Is that statement displacing interior because of interior's flaw? [00:32:21] Speaker 01: I think it's, again, I don't know that it is displacing interior under all circumstances. [00:32:27] Speaker 04: Well, can they coexist? [00:32:30] Speaker 01: I think that they can. [00:32:31] Speaker 01: I think that the duty to bargain questions, which were not addressed in the general broader midterm bargaining, which again, I think this says that it can't discuss every situation under the statute. [00:32:44] Speaker 01: But I think creating a regime where there is a, [00:32:49] Speaker 01: Reopeners and zippers are mandatory subjects of bargaining means that parties should settle these issues during term negotiations. [00:32:58] Speaker 01: There's no reason not to, because they're mandatory subjects of bargaining. [00:33:02] Speaker 01: So I think that's the rule that this decision is creating. [00:33:09] Speaker 01: I think under some circumstances- So do you disagree with Mr. Shah? [00:33:13] Speaker 04: I asked him this question. [00:33:15] Speaker 04: this question of whether the world's divided into two buckets or more. [00:33:18] Speaker 04: Is the world divided into permissive rights and unilateral rights? [00:33:24] Speaker 04: Or when you say it's not covering everything and somehow the statutory holding an interior, although flawed, is somehow still with us, that there's some third bucket of statutory rights? [00:33:38] Speaker 01: There may be. [00:33:40] Speaker 04: Are you reading this decision? [00:33:47] Speaker 04: I'm just trying to understand. [00:33:47] Speaker 04: The way you said the more appropriate sentence is not displacing interior was to suggest that there is a third bucket. [00:33:57] Speaker 04: Well, but I don't, I've never seen that before. [00:34:00] Speaker 04: So I'm trying to understand how you get that out of here or what your basis and authority president. [00:34:05] Speaker 01: Well, I mean, the third bucket was not, as you know, it was not raised by the unions and it wasn't raised in the comments either, but there is, we know there's a third bucket because the covered by doctrine is in the third bucket, right? [00:34:19] Speaker 01: Covered by doctrine is a statutory right, but it's not a unilateral right. [00:34:23] Speaker 01: There are lots of grievance procedure, a broad scope grievance procedure, maybe a statutory right under some circumstances, but it's not a unilateral. [00:34:30] Speaker 04: Covered by is a statutory right as opposed to a way of analyzing whether or not something is eligible for midterm bargaining? [00:34:39] Speaker 01: Right. [00:34:39] Speaker 01: I mean, in certain circumstances, agencies have a right to invoke the covered by doctrine. [00:34:45] Speaker 01: Official time proposals, for example, there's a statutory right [00:34:48] Speaker 04: Oh, I'm sorry. [00:34:49] Speaker 04: Okay. [00:34:49] Speaker 04: I misunderstood what you're talking about. [00:34:51] Speaker 01: Right. [00:34:51] Speaker 01: There's a statutory right to official time. [00:34:54] Speaker 01: It's not a unilateral right, meaning that that official time proposals are not permissive subject to bargaining. [00:34:59] Speaker 01: There's a statutory right to impact and implementation bargaining proposals to limit the scope of the I&I bargaining are [00:35:06] Speaker 01: are not permissive subjects or mandatory subjects. [00:35:11] Speaker 04: Okay, so to be clear then, so your reading of this paragraph on 75, and I guess there's a line or so on 76, but the line, the section of the decision focused on the prior decision in interior and the status of midterm bargaining. [00:35:26] Speaker 04: What you're telling us, what this language means is that there is still a statutory right to midterm bargaining under interior. [00:35:36] Speaker 04: That statutory rights still exist, even if- Right. [00:35:41] Speaker 01: It exists until there's a specific case that comes up that doesn't involve zipper clauses or reopener clauses are covered by, I mean, to give you a sense of how abstract this is, there isn't even a single ULP charge pending before the authority where somebody has raised this as a defense to midterm bargaining, this policy statement saying we don't have any obligation to bargain midterm. [00:36:04] Speaker 01: Because this policy team and this is the argument that this policy statement abrogated completely mid on midterm bargaining under all circumstances. [00:36:15] Speaker 01: That's several several steps down down the road from this policy statement this policy statement. [00:36:22] Speaker 01: As it says in its first paragraph, it holds that zipper clauses are mandatory subject to bar. [00:36:28] Speaker 04: I just want to make sure in those later cases you're telling me the authorities position going to be, it's going to be that yeah interior is still good law as the existence of the statutory right. [00:36:38] Speaker 01: Right, I think parties will have to raise. [00:36:41] Speaker 04: No, no, no, no, my question is to you. [00:36:43] Speaker 01: Right. [00:36:44] Speaker 04: Sorry, sorry, sorry, just to make sure we're talking about the same thing because this is really important to me. [00:36:53] Speaker 04: if someone were to come in and say, well, there's still a statutory right to midterm bargaining. [00:36:59] Speaker 04: And that was unaffected by this general policy statement. [00:37:03] Speaker 04: In fact, this general policy statement still recognizes and preserve that statutory right. [00:37:08] Speaker 04: The authority will say yes. [00:37:10] Speaker 01: Yes, I think that the authority will, yes, I think that this, again, is binding precedent on whether zipper clauses are mandatory or permissive subjects of bargaining. [00:37:21] Speaker 01: This is not binding precedent on whether there can ever be a right to bargain midterm under any and all circumstances. [00:37:27] Speaker 01: I think the authority disclaimed that it was speaking, that it was giving a definitive statement on midterm bargaining under all circumstances. [00:37:38] Speaker 01: I think that's a case-specific inquiry [00:37:40] Speaker 01: And there's still precedent out there. [00:37:43] Speaker 01: The interior is still out there on that question. [00:37:47] Speaker 01: This is a zipper clause ruling. [00:37:49] Speaker 01: It holds that zipper clauses are mandatory subjects of bargaining. [00:37:55] Speaker 01: That's all that it holds. [00:37:56] Speaker 01: And it describes the regime that it's creating as one where everything related to midterm bargaining is a mandatory subject of bargaining for term bargaining. [00:38:07] Speaker 01: It should be settled that way. [00:38:08] Speaker 01: And it gives lots of justifications [00:38:10] Speaker 01: as to why that regime is good, why it's good to give parties, it enhances collective bargaining, to give parties the ability to control the scope and timing of negotiations over the term of their contract. [00:38:22] Speaker 01: And that's what this policy statement is geared towards. [00:38:26] Speaker 04: Does the authority's decision apply, does this general statement like this apply only prospectively, or does it apply to existing agreements? [00:38:38] Speaker 01: Again, I think that it doesn't include anything about [00:38:45] Speaker 01: I don't think there's anything really here to apply retrospectively, because as I said, this holds a zipper clause. [00:38:53] Speaker 01: They're mandatory subjects of negotiation. [00:38:56] Speaker 01: So if parties out there were already. [00:38:58] Speaker 04: Well, no, you've got an existing collective bargaining agreement. [00:39:02] Speaker 04: And a union comes and says, hey, we need midterm bargaining on COVID. [00:39:07] Speaker 04: This thing came up. [00:39:08] Speaker 04: What the COVID policies are. [00:39:11] Speaker 04: work from home policies or something like that within the agency, we need to talk about those midterm. [00:39:19] Speaker 04: Is it your view that that could be forced to the impasses panel now, if they started that bargaining and couldn't agree? [00:39:27] Speaker 04: Or does this only apply to once a new collective bargaining agreement starts? [00:39:32] Speaker 01: I think this means that this means that a zipper clause proposal and no, no, it's not my question. [00:39:38] Speaker 01: Right. [00:39:39] Speaker 04: I think that forcing something to the impasses panel. [00:39:42] Speaker 04: Forcing a so a collective bargaining agreement that was negotiated under interior as a settled law before this decision. [00:39:51] Speaker 04: Mm hmm. [00:39:52] Speaker 04: right to midterm bargaining. [00:39:55] Speaker 04: There's no zipper clause that's gonna solve this problem for us. [00:39:58] Speaker 04: An opportunity and necessity for midterm bargaining arises because of unfortunate circumstances like the COVID pandemic. [00:40:07] Speaker 04: And so they start bargaining and they're unable to agree. [00:40:12] Speaker 04: And so would that be something that would get pressed to the impasse panel or not? [00:40:21] Speaker 01: I think that if there, again, if there's no reopeners clause, there's no covered by argument, none of there's, there's no, it's very clear that COVID stuff, of course there's nothing covered. [00:40:32] Speaker 01: Right. [00:40:32] Speaker 01: Well, I mean, there are help. [00:40:34] Speaker 04: My hypothetical is not relevant zipper or reopener clause. [00:40:37] Speaker 01: Right. [00:40:38] Speaker 01: Yeah, I think interior is still good law until it's specifically overruled in a specific. [00:40:44] Speaker 04: So they could, so if they aren't able to come to agreement under my hypothetical, would that go to the impasse panel or not? [00:40:51] Speaker 01: It could go to the impasse's panel. [00:40:53] Speaker 04: If they can't come to agreement, would it go to the impasse panel? [00:40:57] Speaker 01: Right. [00:40:57] Speaker 01: It could. [00:40:58] Speaker 01: Well, I mean, it wouldn't. [00:40:58] Speaker 01: There's no. [00:40:59] Speaker 01: But yeah, yeah. [00:41:01] Speaker 01: What you're saying is, is interior still good law in the area? [00:41:05] Speaker 04: No, what I'm asking is whether this applies to this. [00:41:08] Speaker 04: If one reads this as changing the landscape, I get that you don't. [00:41:12] Speaker 04: But if one reads the decision as changing the landscape, would that change in the landscape apply to existing collective bargaining agreements or only prospective? [00:41:22] Speaker 01: So reading this, not the way that we're reading it. [00:41:27] Speaker 04: You're reading it now, yeah. [00:41:29] Speaker 01: Okay, definitive. [00:41:29] Speaker 01: So reading this as the last word on midterm bargaining, are issues related to midterm bargaining now entirely permissive and any effort to get to the impasse, this panel draws a ULP? [00:41:46] Speaker 01: No, I don't think that that's where we end up from this policy statement. [00:41:54] Speaker 02: Let me make sure my colleagues don't have additional questions for you. [00:42:01] Speaker 03: I had one more, but I thought I was talking too much. [00:42:03] Speaker 03: I was talking too much. [00:42:06] Speaker 03: No, no, of course. [00:42:07] Speaker 04: Go ahead. [00:42:11] Speaker 04: What does appropriate techniques mean? [00:42:13] Speaker 04: Is there any authority decision defining that phrase? [00:42:17] Speaker 04: I know they reference it in this decision, but apart from this decision, [00:42:21] Speaker 01: I think what this is what this calls to mind about the appropriate techniques is a ground rules agreements. [00:42:30] Speaker 01: So ground rule proposals which say that control allow parties to control the scope and timing of term negotiations. [00:42:37] Speaker 01: And so what the end those would be appropriate techniques. [00:42:41] Speaker 04: Now what is that techniques are sort of the procedures. [00:42:44] Speaker 04: and rules for bargaining, but not actually the content of the bargain. [00:42:48] Speaker 01: Right. [00:42:48] Speaker 01: Those are rules. [00:42:49] Speaker 01: Ground rules are rules for bargaining, right? [00:42:51] Speaker 01: But not the content of the bargaining. [00:42:53] Speaker 01: Right. [00:42:53] Speaker 05: Would you be excited for that for us, just if we wanted to follow up and understand that argument? [00:43:00] Speaker 01: So yeah, that's a really good question. [00:43:03] Speaker 01: I can give you more on that, if you would like, on [00:43:08] Speaker 01: on the techniques language here. [00:43:10] Speaker 01: But like I said, I think what this is, and this is certainly something that was brought up in the comments was that ground rules proposals are, you know, are mandatory subjects of bargaining because they control the scope and timing of negotiation. [00:43:24] Speaker 01: So what the authority is here saying is that these can be thought of as sort of like a ground rules proposals, but for the term, when topics are gonna be brought up during the term of the agreement. [00:43:36] Speaker 01: But yes, I can get you sites on that. [00:43:38] Speaker 04: Thank you. [00:43:40] Speaker 04: That's all I had. [00:43:42] Speaker 02: Sorry. [00:43:43] Speaker 02: Okay. [00:43:43] Speaker 02: Thank you, Mr. Peters. [00:43:46] Speaker 02: Mr. Schaub, we'll start with two minutes for rebuttal. [00:43:49] Speaker 06: Thank you, Your Honor. [00:43:51] Speaker 06: Just a few quick points. [00:43:52] Speaker 06: I want to begin with this new view as spouse today that the decision below did not depart from Interior, that Interior is compatible with [00:44:03] Speaker 06: the court's rationale below, sorry, the authority's rationale below. [00:44:07] Speaker 06: That simply cannot be true. [00:44:10] Speaker 06: Here's what the authority said in this decision below. [00:44:12] Speaker 06: I'm quoting, the statute neither requires- Where are you quoting from? [00:44:17] Speaker 06: Term bargaining. [00:44:18] Speaker 02: Where are you quoting from? [00:44:20] Speaker 06: This is the language that Judge Malette was- A75. [00:44:24] Speaker 06: Yes. [00:44:28] Speaker 06: And here's what the authority said. [00:44:30] Speaker 06: The statute neither requires nor prohibits midterm bargaining. [00:44:34] Speaker 06: Instead, leaves midterm bargaining obligations to the parties to resolve as part of their term negotiations, end quote. [00:44:42] Speaker 06: In other words, they need to work out what's going to happen midterm at the bargaining table, if they want to, if a union wants to be able to initiate [00:44:50] Speaker 06: bargaining midterm, it needs to propose that and secure that right contractually at the bargaining table. [00:44:57] Speaker 06: That is incompatible with interior, which said the statute will be interpreted to require agencies to bargain midterm over union initiated proposals that are not covered by the term agreement, assuming no waiver. [00:45:13] Speaker 06: Those two things are incompatible. [00:45:15] Speaker 06: Interior was overturned. [00:45:17] Speaker 06: And that was the basis of all of our arguments to this court in our briefs. [00:45:23] Speaker 06: Nowhere in the authority's briefs to this court did it say, no, wait, hang on. [00:45:28] Speaker 06: Interior is still good law. [00:45:31] Speaker 06: This was a new position thrown out today that's simply incompatible with the authority's decision. [00:45:37] Speaker 06: Second, Your Honors, [00:45:39] Speaker 06: As I think today's questioning highlighted the only basis that authority gave below for saying that interior was flawed simply doesn't hold up. [00:45:50] Speaker 06: If you look at page 51 of Interior, which is what the authority cited below for its description of Interior and the subsequent conclusion that its rationale was flawed, if you look at that page, number one, the authority below mischaracterized what Interior said. [00:46:09] Speaker 06: And second, Interior gave a textually accurate view of the statute. [00:46:15] Speaker 06: Third, I would add, Your Honors, that as the questioning today showed, the authority did not need to revisit its midterm bargaining precedent to answer the zipper clause question. [00:46:26] Speaker 06: It simply could have consulted that existing precedent. [00:46:30] Speaker 06: And as it did so many times over the last several decades, it could have reaffirmed the midterm bargaining right, but then went on to do the unilateral rights analysis that it did with the course and departing from that precedent. [00:46:46] Speaker 05: And why couldn't we just affirm the Zipper Clause holding based on the alternative argument on JA77 regarding this [00:47:00] Speaker 05: Appropriate techniques point that assist in negotiation to the extent that that's a freestanding rationale that's disentangled from interior. [00:47:09] Speaker 05: Why is that inadequate [00:47:15] Speaker 06: Our argument in our briefs is that it's simply unreasoned. [00:47:18] Speaker 06: The authority latched onto a single clause in section 71-14A4 for this vague rationale. [00:47:29] Speaker 06: Nothing in 71-14 or 71-19, which is referenced in that section, nothing speaks to the mandatory versus permissive issue. [00:47:39] Speaker 06: Neither of the sections report the authority's zipper clause ruling. [00:47:44] Speaker 06: Unless there are further questions. [00:47:45] Speaker 04: I just wanted to get your response to, I'm feeling more confused rather than less now. [00:47:53] Speaker 04: You said the world's divided into two buckets. [00:47:56] Speaker 04: Mr. Peters said, no, there's this third bucket. [00:48:00] Speaker 04: You can have these statutory rights that are neither permissive nor unilateral. [00:48:06] Speaker 04: They just have their own distinct status. [00:48:08] Speaker 04: I understood him right. [00:48:08] Speaker 04: I hope I got it right that there's a third bucket. [00:48:12] Speaker 04: What is your response to that? [00:48:14] Speaker 06: when it comes to statutory rights, that's the larger umbrella under which you have rights that are statutory, which are either unilaterable rights or other statutory rights. [00:48:26] Speaker 06: That's the division when it comes to the... Sorry, I had an internet glitch on my end. [00:48:31] Speaker 04: So you said there's either, you got your pool of statutory rights and they're either permissive or, and that's where I got my internet wrinkle. [00:48:41] Speaker 06: Your Honor, there are other unilateral rights that cannot be the subject of a mandatory bargaining proposal, or there are other statutory rights that could be the subject of a mandatory bargaining proposal. [00:48:55] Speaker 04: They're either permissive or unilateral. [00:48:58] Speaker 06: Correct. [00:48:59] Speaker 04: No. [00:48:59] Speaker 04: Permissive is unilateral. [00:49:01] Speaker 05: There either unilateral, permissive, or mandatory. [00:49:03] Speaker 04: Yes, permissive or non-unilateral. [00:49:05] Speaker 04: We all understood. [00:49:06] Speaker 04: Non-unilateral is a mandatory bargain. [00:49:08] Speaker 06: That's correct, Your Honor. [00:49:09] Speaker 06: When there are statutory rights, there are those two buckets. [00:49:12] Speaker 06: I don't see, and I didn't quite understand the potential third bucket there, but when it comes to statutory rights, there are either things you have to bargain with. [00:49:20] Speaker 04: Are you aware of any authority that has ever talked about a third bucket? [00:49:24] Speaker 06: I'm not your honor and the authority authority, I guess. [00:49:27] Speaker 06: And there's certainly certainly no discussion of a third bucket in the decision below. [00:49:32] Speaker 02: Do you think there is a category of statutory rights sounds like you're saying it's just that it's on a different axis than permissions versus mandatory that statutory rights either fall into the permissive bucket or they fall into the mandatory book. [00:49:45] Speaker 06: Yes, when it comes to rights under the Federal Sector Labor Statute, they are either unilateral rights that don't have to bargain over their permissives, or they fall into this other category where they could be the subject of a mandatory bargaining proposal. [00:49:59] Speaker 02: The other category is mandatory? [00:50:01] Speaker 02: Yes. [00:50:03] Speaker 02: Just to get the terminology right in my mind. [00:50:05] Speaker 04: Sorry, I was messing it all up. [00:50:07] Speaker 02: No, no. [00:50:07] Speaker 02: There's a lot of different words going on in different directions, but OK. [00:50:12] Speaker 02: Are there further questions from my colleagues? [00:50:16] Speaker 02: Thank you, counsel. [00:50:17] Speaker 02: Thank you to both counsel. [00:50:18] Speaker 02: We'll take this case under submission.