February 2, 1979


79-11       MEMORANDUM OPINION FOR THE
            ADMINISTRATOR OF VETERANS AFFAIRS

            Federal Labor Relations Council—Labor-
            Management Relations for Executive Agencies
            (Executive Order No. 11491)—Jurisdiction of the
            Council in Labor Disputes Concerning the
            Conditions of Employment of Medical, Dental,
            and Nursing Personnel of the Veterans
            Administration


   This responds to your request for the opinion o f the Attorney General
concerning the obligation o f the A dm inistrator o f Veterans Affairs (VA)
to abide by the decision o f the Federal Labor Relations Council (FLRC) in
American Federation o f Government Employees, Local 1739 and Vet­
erans Administration Hospital, Salem, Va., No. 76A-88 (1978) (Union
and Hospital, respectively), that Executive O rder No. 11491 required the
Hospital to negotiate with the Union the procedures for the evaluation of
probationary professional medical employees. VA contends that 38 U.S.C.
§ 4108(a) exempts its Departm ent o f Medicine and Surgery (DMS) from the
order’s requirement. The A ttorney General referred the m atter to this of­
fice. We conclude that 38 U .S.C . § 4108(a) does not exempt VA, and that
VA will not be acting unlawfully in implementing FLRC’s decision.
   Executive O rder No. 11491 established a system o f labor-management
relations for executive agencies.' It applied, with exceptions not relevant
here, to all agencies o f the executive branch, including VA.2 The order
authorizes a majority o f the employees in an appropriate unit o f an



  1 See, generally. Old Dominion Branch No. 496, National Association o f Letter Carriers v.
Austin, 418 U.S. 264, 273-75 (1974). Exec. O rder N o. 11491 has been superseded, effective
January 13, 1979, by Title Vll o f the Civil Service Reform Act o f 1978, 92 Stat. 1111, 5
U .S.C . § 1101 et seq. (Supp. 1979). However, the Act does not affect administrative pro­
ceedings initiated under Exec. O rder No. 11491. See § 902(b), 92 Stat. 1224.
   1 Exec. O rder No. 11491, §§ 2(a), 3(a); see 38 U .S.C . § 201.

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agency to select a union as its exclusive representative.3 To the extent per­
mitted by law and executive-branch-wide regulations, § 11(a) of the order
requires an agency to negotiate in good faith with an exclusive representa­
tive o f the bargaining unit with respect to personnel policies and practices
and matters affecting working conditions. But an agency is not required to
negotiate over the content o f its own agency-wide regulations “ for which a
compelling need exists under criteria established by the Federal Labor
Relations Council.” 4
   When an agency contends that a subject on which a union proposes to
negotiate is controlled by an agency-wide regulation, the union may ap­
peal to the FLRC .5 If the FLRC determines that there is no compelling
need for the regulation, the agency is required to negotiate on the subject.6
Failure to negotiate then becomes an unfair labor practice, and the Assist­
ant Secretary o f Labor for Labor-Management Relations may order the
agency to negotiate.7 The agency may appeal the Assistant Secretary’s
decision to the final administrative authority, the FLR C .8
   The dispute in question concerns the negotiability o f VA’s procedures
for retaining or dismissing probationary medical professional employees.
Physicians and other medical professionals in the DMS are appointed
“ after [their] qualifications have been satisfactorily established, in accord­
ance with regulations prescribed by the Administrator, without regard to
civil service requirem ents.” 38 U.S.C. § 4106(a). Under 38 U.S.C.
§ 4106(b):
      Such appointm ents as described in subsection (a) o f this section
     shall be for a probationary period o f three years and the record
     o f each person serving under such appointm ent in the Medical,
     Dental, and Nursing Services shall be reviewed from time to time
     by a board, appointed in accordance with regulations o f the A d­
     ministrator, and if said board shall find him not fully qualified
     and satisfactory he shall be separated from the service.
The implementing VA regulations provide that each employee subject to
§ 4106(b) will have his record reviewed in a fair and impartial m anner by a
professional standards board (PSB) during the employee’s probationary
period. Although the regulations authorize the employee to submit a writ­
ten or oral statement to the PSB during the review, the employee “ is not
entitled to legal or other representation.’” The Union requested the
Hospital to negotiate the professional employees’ right to legal or other
representation during the review o f their records by the PSB. The VA


   1 Exec. Order No. 11491, § 10(a); c f 29 U .S.C . § 159.
   4 Exec. Order No. 11491, § 11(a).
   ’ Exec. Order No. 11491, § ll(c)(4)(ii).
   6 Exec. Order No. 11491, § 4(c)(2).
   7 Exec. O rder N o. 11491, §§ 6(a)(4); 6(b); 19(a)(6). The agency cannot reopen the nego­
tiability dispute in the unfair labor practice proceeding. Exec. O rder No. 11491, § 19(d).
   ■ Exec. O rder No. 11491, § 4(c)(1).
   ’ Veterans’ Adm inistration M anual, MP-5, Part 11, Ch. 4, § 4-06(b)(4).

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determined that the proposal was contrary to its agency-wide regulations,
and the Union appealed to the FLRC for a “ compelling need”
determination.
   The VA argued before the FLRC that it was deprived o f jurisdiction by
38 U.S.C. § 4108(a), which provides in pertinent part:
      Notwithstanding any law, Executive order, or regulation, the
      Adm inistrator shall prescribe by regulation the hours and condi­
      tions o f employment and leaves o f absence o f physicians, den­
      tists, podiatrists, optom etrists, nurses, physician assistants, and
      expanded-function dental auxiliaries appointed to the Depart­
      ment o f Medicine and Surgery * * *.
In its decision dated February 28, 1978, the FLRC first decided that it had
jurisdiction over the case. On the merits, it held that no compelling need
existed for the regulation prohibiting probationary professional medical
employees from being assisted by counsel in a PSB review. The VA con­
tinues to contend that 38 U .S.C . § 4108(a) excluded this type o f dispute
from the FLRC’s jurisdiction, and therefore, the Hospital refused to
negotiate with the Union on the subject.
   The VA claims first, that 38 U .S.C . § 4108(a) exempts it from the
authority o f any other statute or Executive order in determining the
“ hours, conditions o f employment, and leaves o f absence” 10 o f DMS pro­
fessional employees. Further, it argues that evaluation procedures under
38 U .S.C . § 4106(b) are “ conditions o f em ploym ent.” Based on these
arguments it concludes that notwithstanding Executive Order No. 11491,
§ 4108(a) deprived FLRC o f jurisdiction, and VA was not required to
negotiate on these procedures. It is not necessary, however, to determine
whether § 4108(a) or the Executive order would control should they con­
flict. Such a conflict would arise only if the issue on which the Union
wishes to negotiate—procedures before professional standards review
boards—is in fact a “ condition o f employm ent” within § 4108(a). O ur ex­
amination o f the legislative history o f the statute that established the DMS
has convinced us it is not.
   The Departm ent o f Medicine and Surgery was established by Pub. L.
No. 293, 79th Cong., 1st sess., 59 Stat. 675. In creating the departm ent the
Congress intended to insure that VA may hire and discharge medical,
dental, and nursing professionals without regard to competitive examina­
tion and procedural protections given employees in the classified civil serv­
ice." Accordingly, § 6 o f the statute, now 38 U.S.C. § 4106, regulated the
appointm ent, tenure, £nd prom otion o f professional probationary



  10 We note that 38 U .S.C . § 4108(a) is incorrectly quoted on page 3 o f your request as em­
powering the A dm inistrator to prescribe “ term s and conditions of employm ent.”
  " See H . Rept. 1316, 79th C ong., 1st sess., at 1-2; S. Rept. 853, 79th C ong., 1st sess., at 1;
Hearings before the Com mittee on W orld W ar Veterans Legislation o f the House o f Repre­
sentatives on H .R . 4225, 79th C ong., 1st sess., at 36-39 (statem ent o f Paul Hawley, Surgeon
General, Veterans’ Adm inistration).

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employees appointed “ without regard to civil-service requirem ents.” P ro­
bationary tenure, governed by § 6(b), 38 U.S.C. § 4106(b), permits the dis­
missal o f unsatisfactory probationers after a 3-year period. The pro­
cedural protections given classified civil service employees were not
granted to this class o f employees.12 Further, section 10 o f the statute, 38
U .S.C. § 4110, establishes a disciplinary system for permanent employees
independent o f the civil service laws.11
   Section 4108(a) o f title 38 was enacted as 7(b) o f the statute. In his re­
marks on behalf of the House Committee on World W ar Veterans Legisla­
tion, Representative Scrivner explained:
     In section (b), we provide that notwithstanding any law, Ex­
     ecutive order, or regulation, the Adm inistrator shall prescribe by
     regulation the hours and working conditions and leaves o f ab­
     sence o f doctors, dentists, and nurses.14
This is the only discussion o f § 7(b) in the legislative history.
   From its context in the statute and its limited legislative history, the
“ conditions o f employment” in 38 U.S.C. § 4108(a) are matters similar to
hours and leave, i.e., duties and workload; tenure and discharge o f pro­
fessional employees are regulated by other portions o f the statute.
Moreover, if “ conditions o f employment” included tenure and discharge,
the breadth o f § 4108(a) would have made it unnecessary for Congress to
expressly exclude appointm ents under § 4106 from the civil service laws or
to provide a separate disciplinary system under 38 U.S.C. § 4110. The pro­
cedures for professional evaluation are set out in 38 U .S.C . § 4106(b).
Therefore, § 4108(a) does not exempt the Department o f Medicine and
Surgery from the FLRC’s jurisdiction in this case.

                                                          Jo h n M . H a rm o n
                                                   Assistant A ttorney General
                                                                 Office o f Legal Counsel




   11 Section 6 and subsection 6(b)         were extensively discussed in the legislative process. See S.
Rept. 858, 79th Cong., 2d sess., at 1,      3; H. Rept. 1316, 79th Cong., 1st sess., at 1-2; 91 C o n g .
Rec . 11656 (Representative Rogers),        11659 (Representative Cunningham ), 11665 (Represent­
ative Engle).
   M See S. Rept. 858, 79th Cong.,          1st sess., at 4; 91 C o n g . R e c . 11663 (Representative
Scrivner).
  14 91 C o n g . R e c . 11662-63 (R ep resen ta tiv e Scrivner).


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