The Small Business Administration, New York District Office, New York, New York (Employer or SBA) filed a request for assistance in a dispute arising from negotiations with Local 3134, American Federation of Government Employees, AFL-CIO (Union), over the Employer’s proposal to discontinue providing bottled water at the New York District Office. After due consideration of the request, the Federal Service Impasses Panel (Panel) determined that the impasse should be resolved through a mediation-arbitration procedure before the undersigned.

    Accordingly, a mediation-arbitration hearing was held on March 29, 2000, at the Employer’s place of business, 26 Federal Plaza (the Federal building), New York, New York. Despite efforts made to mediate a voluntary resolution, the parties were unable to reach agreement on the outstanding issue. When those efforts ended, a brief hearing was conducted during which the parties presented their final offers and a summary of supporting evidence and arguments that had been discussed at length during the mediation phase. Both parties declined the offered opportunity to submit post-hearing statements.

    The Employer’s mission is to guarantee loans to small businesses. The Union represents a bargaining unit of 30 to 40 employees, who are part of a nationwide unit of about 3,400. Most bargaining-unit employees hold positions as specialists in loans, business opportunities, business information, and loan processing, and as economic development assistants and clerical workers at grades GS-1 through GS-13. The parties are covered by a master collective bargaining agreement (MCBA) which is to remain in effect until August 27, 2002.

    The SBA’s District Office is located with other Federal agency tenants on the 31^st floor of a 44-story building in lower Manhattan. Some different SBA offices are located on part of the 33^rd floor. The 31^st and several other floors are served by a bank of eight elevators. According to the Assistant Building Manager,⁽¹⁾ above the 15^th floor, New York City water is pumped to holding tanks on the 44^th floor; from the tanks, water flows through filtering and chiller systems to drinking fountains on the higher floors, including those on the 31^st floor. The fountains on the 31^st floor were recently replaced.

    The parties believe that sometime during 1988, when asbestos was being removed from the building, the building’s water was found to be unhealthful; as a result, GSA provided bottled water for employees for a number of months. When the quality of the water improved, GSA discontinued the service. At that point, the Assistant Regional Director of the SBA decided to continue to provide water using appropriated funds because "he liked the water." The practice continued for over 11 years, until an auditor at the SBA’s Washington, D.C., office informed the current District Director that the practice, paid for by appropriated funds, was "unauthorized." In mid-March 1999, after some negotiations, the Employer discontinued providing bottled water and the Union filed an unfair labor practice (ULP) charge. Subsequently, in August 1999, the Employer settled the ULP by agreeing to resume providing bottled water and, if the Union so requested, to negotiate over discontinuing the practice. As agreed, the parties engaged in bargaining which ultimately led to this dispute.

    The Employer resumed providing water in late September 1999. Currently, the Employer rents three dispensers; each has a hot and a cold water faucet and a small refrigerator in the cabinet beneath where employees store food. Within the office space, there is also a microwave oven available for employees’ use.

ISSUE AT IMPASSE

    Whether and to what extent the Employer should continue to provide bottled water for affected bargaining-unit employees at 26 Federal Plaza.

1. The Employer’s Position

    The Employer proposes the following:

The Agency is willing to entertain the possibility of purchasing a dorm size refrigerator (approximately 3' by 2' in size) for the convenience of employees. The Agency is willing to provide 2 hours of administrative time to the employees in order to arrange for a voluntary bottled water club.

Under Comptroller General decisions and Federal appropriations law, expenditures for bottled water are not permitted in circumstances such as these where tests disclose that the building’s water is potable.⁽²⁾ Within the SBA, only two offices pay for unit employees’ bottled water: In Los Angeles, the SBA provides water at an office that lacks a water supply; in Hato Rey, Puerto Rico, the SBA provides bottled water because the tap water is not considered safe to drink. Otherwise, within SBA nationwide, employees either pay for their own water or use office water fountains. The same is true for employees who work for other Federal agencies on the 31^st floor and, it is believed, elsewhere in the Federal building. Since, as the testing indicates, there is no necessity for continuing to provide bottled water, fairness dictates that the practice should be discontinued, and affected employees be treated the same as other SBA employees nationwide.

    It is recognized that the cost of providing bottled water is not exorbitant: Currently, the office spends $1,200 annually for bottled water, $89 for the monthly bottle deposit, $684 annually for the rental of three dispensers, and $12.95 per 1,000 cups. Over the 11- or 12-year period, expenses have been about $24,000, which is not insubstantial in an era of declining agency budgets. Furthermore, such costs could escalate should the practice continue, and employees at the other 69 SBA offices seek similar considerations.

    Regarding the Union’s concerns about the effect of the change, employees may use the office microwave to heat hot water for coffee, tea, and hot chocolate. Furthermore, as the office culture is not restrictive, employees have the option of going to the 6^th floor cafeteria during the workday for a hot drink if they desire. As an adjustment, a refrigerator could be purchased and 2 hours of administrative time provided to permit employees to organize a group water pool. A long phase-in period, however, is not warranted, essentially because employees have received this benefit for over 11 years even though the justification actually ceased when GSA stopped paying for the water.

2. The Union's Position

    The Union asks that the arbitrator select between its alternative proposals. They are:

The Agency should continue to provide bottled water to the employees in the New York District Office until such time as a Government-wide rule or regulation is put in place prohibiting such a practice; or

A two-year phase out period to coincide with the most recent Master Agreement. That over this period and time, a bottled water committee be established to monitor the water situation on this floor. The Agency has provided bottled water for Bargaining Unit Employees for over 12 years and because it is an established past practice, the agency should continue to pay for the rental of coolers and bottled water for the first 6 months of the 2 years. The Union agrees to pay after 6 months 25 percent of the cost of the water for the remaining year and a half.

In the Union’s view, even though water is available in the building, the Employer has the discretion to continue to purchase bottled water for affected employees. The FLRA has found a substantive obligation to bargain in circumstances similar to those in this case.⁽³⁾ Continuing the long-standing practice is justified because convenient access to hot and cold water avoids more lengthy interruptions in the workday caused by trips to the microwave to heat water or to the cafeteria for hot or cold drinks. Furthermore, the employees have come to depend on the convenience offered by the dispensers which are a fixture in the office. Stopping the practice now, therefore, will have a negative impact on employees’ morale.

    As to the Employer’s position that other Federal offices do not provide bottled water, it is suspected that employers’ convictions that the practice is "unauthorized" or "illegal" unfairly convinced employees’ representatives that they could not negotiate to institute or continue such practices. Furthermore, whether or not other SBA offices provide bottled water for employees should not determine the result in this case. The circumstances here are different and justify continuation because the practice has gone on for so long. Should the arbitrator determine to curtail the practice, given the factors discussed above, the phase out should be gradual, with employees assuming a reasonable proportion of the expense for the water.

    In reaching this decision, I have considered that unit employees are losing a convenience that they have come to expect and enjoy over a significant period. In these circumstances, a 4-month period, which covers spring and summer months, seems an appropriate length of time for employees to work out a voluntary, self-financed arrangement for bottled water.⁽⁴⁾ The Employer’s proposal on administrative time is modified here because it is indefinite and makes no provision for additional meeting time, if needed. The amenity of a suitably-sized refrigerator should substitute for the three in the water dispenser cabinets. The Employer’s proposed wording on a refrigerator is modified both because it is again indefinite, and to ensure that the appliance is appropriately sized. The conduct of periodic testing, as permitted under applicable regulations and the lease, and the availability of test reports, should be helpful to employees who occasionally or even frequently use the office water fountains.

    Requiring the Employer to maintain the bottled water practice beyond this relatively short adjustment period does not appear justified. In this regard, the report provided by the Assistant Building Manager shows that contaminants in water do not exceed safe levels established by the Environmental Protection Agency. Neither party provided expert testimony to refute the test results, nor did the Union conduct an independent test to establish the necessity for providing bottled water.⁽⁵⁾ To the extent that visual inspection of the water is instructive, the undersigned examined the drinking fountain water during the procedure and did not observe any obvious discoloration, sediment, unpleasant taste, or foul odor.

    It is undisputed that the overwhelming practice within the SBA and in other Federal agencies throughout country is that employees either drink water from the building’s fountains or purchase their own bottled water, individually or through clubs. These same practices are replicated in agencies collocated with affected employees on the 31^st floor of the Federal building. At the two offices within the SBA where the Employer provides water, the water is either unsafe or unavailable. There is no evidence that the lack of such practices elsewhere, as the Union suggests, is the result of misrepresentations by other employers on the legality of providing bottled water. In the event that employees decide not to continue the in-house availability of bottled water, the Employer indicates that the culture in its office would be tolerant of employees’ going to the cafeteria or taking reasonable time to heat water in the microwave.

DECISION

The practice of providing cost-free, bottled water shall end 4 months from the date of this decision. During the 4-month period prior to termination, the Employer agrees to provide 2 hours of administrative time, upon request, for the Union and bargaining-unit employees to meet and decide whether they wish to arrange to purchase bottled water as a group and to work out the details of such an arrangement. Should 2 hours be insufficient, the Employer may, workload permitting, grant a request for additional administrative time. Upon request by the Union, the Employer shall provide a refrigerator of sufficient size to store employees’ lunches, snacks, and drinks. The Employer shall request periodic testing of the quality of water delivered through the building’s water system, as permitted under the lease and applicable regulations, and provide the Union with copies of the test results.

Ellen J. Kolansky

Arbitrator

April 14, 2000

Washington, D.C.

1.At the request of the undersigned, the Assistant Building Manager, a General Services Administration (GSA) employee, was available during part of the procedure to explain the building’s water system and to answer the parties’ and the arbitrator’s questions.

2.At the mediation-arbitration procedure, the Assistant Building Manager provided results from a test of the water conducted on October 22, 1999, at 26 Federal Plaza by Barclay Water Management, Inc. The test report is as follows: