National Federation of Federal Employees, Local 1622 v. Brown

645 F.2d 1017, 207 U.S. App. D.C. 92, 24 Wage & Hour Cas. (BNA) 1209, 1981 U.S. App. LEXIS 20095
CourtCourt of Appeals for the D.C. Circuit
DecidedFebruary 18, 1981
DocketNos. 79-2394, 80-1092
StatusPublished
Cited by5 cases

This text of 645 F.2d 1017 (National Federation of Federal Employees, Local 1622 v. Brown) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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National Federation of Federal Employees, Local 1622 v. Brown, 645 F.2d 1017, 207 U.S. App. D.C. 92, 24 Wage & Hour Cas. (BNA) 1209, 1981 U.S. App. LEXIS 20095 (D.C. Cir. 1981).

Opinions

Opinion for the court filed by Circuit Judge GINSBURG.

Dissenting opinion filed by Circuit Judge ROBB.

GINSBURG, Circuit Judge:

These cases are companion to American Federation of Government Employees v. Campbell, No. 79-2024 (D.C. Cir. December 18, 1980); they present the question whether the Secretary of Defense properly imposed a 5.5% cap for fiscal year 1979 on the pay increases of members of the class represented by plaintiff-appellants. American Federation of Government Employees v. Campbell involved federal blue-collar workers, designated “prevailing rate employees,”1 who are paid by funds appropriated by Congress. The cases we now decide also involve federal blue-collar, prevailing rate employees. However, the workers in the instant cases are not paid with funds appropriated by Congress. Called “nonappropriated fund workers,” they are paid with funds from other sources, mainly income generated by the organizations they serve.2

In American Federation of Government Employees v. Campbell, we held that in an appropriations bill signed by the President on October 10, 1978,3 Congress effectively capped at 5.5% the fiscal year 1979 pay increases of prevailing rate employees paid with appropriated funds. That enactment, all parties agree, does not encompass nonappropriated fund workers. Nonetheless, the district court held that the Secretary of Defense properly imposed the same 5.5% cap pursuant to the administration’s announced anti-inflation program.4 Authority for executive imposition of the cap was found in the relevant “public interest” clauses of the “prevailing rate statute.”5

We conclude that the “public interest” clauses do not bear the weight the district court placed on them. Rather, we believe that executive discretion to fix and adjust pay rates for members of the class herein is circumscribed by the principles Congress enumerated in 5 U.S.C. § 5341 (1976): (1) equal pay for equal work in all federal agencies within the same locality; (2) differences in pay for substantial differences in duties, responsibilities, and qualification requirements; (3) rates of pay maintained in line with rates paid locally for comparable work in the private sector; (4) rates of pay maintained at a level that attracts and retains qualified employees. If other principles are to augment, modify, or supplant this list, Congress must supply the authorization. We therefore reverse the judgments entered for the defendants and remand for further proceedings consistent with the pay-setting guidelines Congress has established. As we explain below, the 5.5% pay cap for nonappropriated fund workers might be justified under the first principle Congress supplied, equal pay for equal work in all federal agencies within the same locality. But the executive action at issue must be tied to a legislative direction giving content to the words “public [95]*95interest.” Congress did not authorize the executive to go outside its guidelines and attribute to those words any nonarbitrary meaning the President finds consonant with the nation’s welfare.

I.

In these two cases, considered separately below and consolidated on appeal, plaintiff-appellants are two unions and two individuals; they represent a class of some 100,000 nonappropriated fund blue-collar workers employed by instrumentalities of the Department of Defense and Veterans Administration. The pay rates of the class herein are governed by 5 U.S.C. §§ 5341-5349 (1976 & Supp. III 1979) (the “prevailing rate statute”). Congressional policy for prevailing rate pay systems is set out in § 5341:

It is the policy of Congress that rates of pay of prevailing rate employees be fixed and adjusted from time to time as nearly as is consistent with the public interest in accordance with prevailing rates and be based on principles that—
(1) there will be equal pay for substantially equal work for all prevailing rate employees who are working under similar conditions of employment in all agencies within the same local wage area;
(2) there will be relative differences in pay within a local wage area when there are substantial or recognizable differences in duties, responsibilities, and qualification requirements among positions;
(3) the level of rates of pay will be maintained in line with prevailing levels for comparable work within a local wage area; and
(4) the level of rates of pay will be maintained so as to attract and retain qualified prevailing rate employees.

Section 5343 of the prevailing rate statute repeats the general policy that “wages shall be adjusted from time to time as nearly as is consistent with the public interest in accordance with prevailing rates” and establishes a mechanism to carry out the policy. The Office of Personnel Management (OPM) defines relevant (geographical) wage areas and designates a “lead agency” for each area; the lead agency conducts a wage survey in the area, analyzes the data, and establishes “appropriate wage schedules and rates” for prevailing rate employees; all agencies with prevailing rate employees in the wage area must apply the rates established by the lead agency.

Pursuant to § 5343(a)(2), OPM’s predecessor, the Civil Service Commission, defined approximately 145 wage areas and designated the Department of Defense as the lead agency for nonappropriated fund workers in the defined areas. In August and September of 1978, the Department conducted wage surveys to determine the pay rates prevailing in the private sector for workers in the same trades and crafts as members of the class represented by plaintiff-appellants. Thereafter, the Department analyzed the data gathered in the surveys, and developed wage schedules. These schedules suggested increases for members of plaintiff-appellants’ class in excess of 5.5%. The effective date of the proposed increases, pursuant to § 5344(a), was October 22, 1978.6

During this same period, as part of their efforts to control inflation,7 both the President and Congress were acting to place a 5.5% cap on pay increases for, respectively, white-collar personnel and blue-collar workers paid from funds appropriated by Congress. In August 1978, the President, invoking the authority Congress granted him [96]*96in 5 U.S.C. § 5305(c) (1976),8 capped at 5.5% proposed pay increases for white-collar workers. 14 Weekly Comp, of Pres. Doc. 1480. In October 1978, in an appropriations measure, Congress imposed the 5.5% pay increase cap on appropriated fund blue-collar workers. Consistent with the President’s August 1978 action, the measure also capped the pay increase for white-collar workers. Treasury, Postal Service and General Government Appropriations Act, § 614(a), Pub.L.No.95-429, 92 Stat. 1001 (1978).

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645 F.2d 1017, 207 U.S. App. D.C. 92, 24 Wage & Hour Cas. (BNA) 1209, 1981 U.S. App. LEXIS 20095, Counsel Stack Legal Research, https://law.counselstack.com/opinion/national-federation-of-federal-employees-local-1622-v-brown-cadc-1981.