National Association of Postal Supervisors v. USPS ( 2022 )


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  •  United States Court of Appeals
    FOR THE DISTRICT OF COLUMBIA CIRCUIT
    Argued September 21, 2021         Decided February 22, 2022
    No. 20-5280
    NATIONAL ASSOCIATION OF POSTAL SUPERVISORS,
    APPELLANT
    v.
    UNITED STATES POSTAL SERVICE AND UNITED POSTMASTERS
    AND MANAGERS OF AMERICA,
    APPELLEES
    Appeal from the United States District Court
    for the District of Columbia
    (No. 1:19-cv-02236)
    Abigail A. Graber argued the cause for appellant. With
    her on the briefs were Jean M. Zachariasiewicz and Andrew D.
    Freeman.
    Sean Janda, Attorney, U.S. Department of Justice, argued
    the cause for United States Postal Service. With him on the
    brief were Brian M. Boynton, Acting Assistant Attorney
    General, Mark B. Stern, Attorney, and Morgan E. Rehrig and
    Michelle A. Windmueller, Attorneys, U.S. Postal Service.
    Jonathan Greenbaum was on the brief for appellee United
    Postmasters and Managers of America in support of appellees.
    2
    Before: PILLARD and WILKINS, Circuit Judges, and EDWARDS,
    Senior Circuit Judge.
    Opinion for the Court filed by Senior Circuit Judge
    EDWARDS.
    EDWARDS, Senior Circuit Judge: The Postal
    Reorganization Act of 1970 (“Act” or “Postal Act”) delegates
    authority to the United States Postal Service (“Postal Service”
    or “USPS”) to, inter alia, “classify and fix the compensation
    and benefits of all officers and employees.” 
    39 U.S.C. § 1003
    (a). In setting compensation, the Act requires the Postal
    Service to “provide adequate and reasonable differentials in
    rates of pay between employees in the clerk and carrier grades
    . . . and supervisory and other managerial personnel.” 
    Id.
    § 1004(a). In addition, the Postal Service must “achieve and
    maintain compensation for its . . . employees comparable to the
    rates and types of compensation paid in the private sector of the
    economy.” Id. § 101(c); see also id. § 1003(a). The Act also
    directs the Postal Service to allow organizations representing
    supervisory and other managerial employees “to participate
    directly in the planning and development of pay policies and
    schedules, fringe benefit programs, and other programs relating
    to supervisory and other managerial employees.” Id. § 1004(b).
    The principal dispute in this case concerns the Postal
    Service’s proposed 2016–2019 pay package for its “Field”
    Executive and Administrative Schedule (“EAS”) personnel
    (“Field Pay Package”). The National Association of Postal
    Supervisors (“Association”), a recognized organization of
    supervisory personnel, filed a complaint in the District Court
    challenging the Postal Service’s adoption of the Field Pay
    Package. The Association alleged that the Postal Service
    violated the Postal Act by failing to provide a pay differential
    between clerks and carriers and the supervisors that manage
    3
    them, and also failing to consider private sector compensation
    and benefits. The Association also challenged the Postal
    Service’s refusal to consult with the Association regarding pay
    policies for Association members who are postmasters or
    whom the Postal Service categorizes as “Headquarters” and
    “Area” employees.
    In response to the Association’s complaint, the Postal
    Service argued that the matters in dispute regarding the Field
    Pay Package are not subject to judicial review. The Postal
    Service maintained that provisions in the Act authorizing the
    adoption of pay packages merely state “policy goals” that the
    agency “should attempt to achieve,” not mandatory and
    enforceable directives. Br. for Appellee 4, 30. The District
    Court agreed and granted the Postal Service’s motion to
    dismiss the Association’s complaint for failure to state a claim.
    Nat’l Ass’n of Postal Supervisors v. USPS, No. 1:19-CV-2236,
    
    2020 WL 4039177
    , at *3-7 (D.D.C. July 17, 2020), reprinted
    in Joint Appendix (“J.A.”) 39-52. The Association then filed a
    timely appeal claiming that the District Court erred in
    dismissing its complaint. We agree.
    It is well established that judicial review of Postal Service
    actions “is available . . . to determine whether the agency has
    acted ‘ultra vires’—that is, whether it has ‘exceeded its
    statutory authority.’” Mittleman v. Postal Regul. Comm’n, 
    757 F.3d 300
    , 307 (D.C. Cir. 2014) (quoting Aid Ass’n for
    Lutherans v. USPS, 
    321 F.3d 1166
    , 1173 (D.C. Cir. 2003))
    (citations omitted). In National Association of Postal
    Supervisors v. USPS, 
    602 F.2d 420
    , 435, 439, 440 (D.C. Cir.
    1979) (“National Association”), we held that the statutory
    provisions at issue in this case are mandatory directives
    enforceable pursuant to ultra vires review. The scope of review
    articulated in National Association plainly controls the
    disposition of this case.
    4
    After carefully reviewing the record in this case, and
    applying controlling principles from National Association and
    its progeny, we hold that the Association has plausibly alleged
    that the Postal Service exceeded its statutory authority and
    failed to act in conformance with the commands of the Act in
    the following respects: First, the Postal Service acted ultra
    vires by failing to institute “some differential” in pay for
    supervisors and by failing to demonstrate that it “set its
    compensation levels by reference, inter alia, to the
    compensation paid” in the private sector. 
    Id. at 435, 440
    ; see
    also 
    39 U.S.C. §§ 101
    (c), 1003(a), 1004(a). Second, the Postal
    Service failed to follow the commands of the Act by refusing
    to consult with the Association on compensation for “Area”
    and “Headquarters” employees; by refusing to consult
    regarding postmasters; and by failing to provide the
    Association with reasons for rejecting its recommendations.
    See 
    39 U.S.C. § 1004
    (b); National Association, 
    602 F.2d at 439
    . Accordingly, we reverse the judgment of the District
    Court and remand for further proceedings consistent with this
    opinion.
    I. BACKGROUND
    A. Legal Framework
    Congress established the Postal Service as an independent
    agency under the Executive Branch in the Postal
    Reorganization Act of 1970, Pub. L. No. 91-375, 
    84 Stat. 719
    .
    See also 
    39 U.S.C. § 201
    . As noted above, the Act instructs the
    Postal Service to classify and fix the compensation and benefits
    of all officers and employees; provide adequate and reasonable
    differentials in rates of pay between employees in the clerk and
    carrier grades and supervisory and other managerial personnel;
    and to achieve and maintain compensation for its employees
    5
    comparable to the rates and types of compensation paid in the
    private sector of the economy. See 
    id.
     §§ 101(c), 1003(a),
    1004(a), (b).
    Under the Postal Act, the salaries of rank-and-file
    employees – like clerks and carriers – are determined through
    a process of collective bargaining with recognized labor
    unions. Id. §§ 1202–1209. Collective bargaining for rank-and-
    file employees is covered by the National Labor Relations Act
    and subject to the jurisdiction of the National Labor Relations
    Board. Id. § 1209(a). By contrast, supervisory and managerial
    personnel are expressly excluded from representation in any
    collective bargaining unit. Id. § 1202(1).
    Instead, the Act directs the Postal Service to “provide a
    program for consultation with recognized organizations of
    supervisory and other managerial personnel who are not
    subject to collective-bargaining agreements under chapter 12
    of this title.” Id. § 1004(b). An organization is “recognized”
    under the Act if it is “a supervisory organization [that]
    represents a majority of supervisors,” “an organization (other
    than an organization representing supervisors) [that] represents
    at least 20 percent of postmasters,” or “a managerial
    organization (other than an organization representing
    supervisors or postmasters) [that] represents a substantial
    percentage of managerial employees.” Id.
    Once recognized, an organization is “entitled to participate
    directly in the planning and development of pay policies and
    schedules . . . relating to supervisory and other managerial
    employees.” Id. The Act requires the Postal Service to meet “at
    least once a month” with any recognized organization, share
    details of proposed compensation programs, and allow the
    organizations time to make recommendations in response. Id.
    § 1004(c)–(d). The Postal Service must give recommendations
    6
    made by recognized organizations “full and fair consideration,”
    and, “if any of such recommendations are rejected,” must
    provide reasons to the organization explaining why. Id.
    § 1004(d)(1)(C), (2)(C).
    In the event that a recognized organization “believes that
    the decision of the Postal Service is not in accordance with the
    provisions of [the Postal Act],” the statute includes a dispute
    resolution process. Id. § 1004(f)(1). Upon request by a
    recognized organization, the Federal Mediation and
    Conciliation Service must convene a factfinding panel to
    review the Postal Service’s decision. Id. The panel hears from
    the parties and makes recommendations concerning
    supervisory pay programs. Id. § 1004(f)(3), (4). The Postal
    Service must then “give full and fair consideration to the
    panel’s recommendation and shall explain in writing any
    differences between its final decision and the panel’s
    recommendation.” Id. § 1004(f)(5).
    B. Factual Background
    The Postal Service employs approximately 625,000
    workers, about 49,000 of whom are supervisors, managers,
    postmasters, and other professional and administrative
    workers. These workers, known as “Executive and
    Administrative Schedule” employees, operate under the
    direction of approximately 500 executives, and in turn manage
    hundreds of thousands of rank-and-file employees, like clerks
    and carriers. The Postal Service designates its EAS employees
    as either “Headquarters,” “Area,” or “Field” employees, based
    on “where employees work or to whom they report.” Reply Br.
    for Appellant 19. EAS employees are distributed across more
    than 1,000 job titles and levels.
    7
    The National Association of Postal Supervisors is a
    “recognized organization[] of supervisory and other
    managerial personnel” employed by the Postal Service. 
    39 U.S.C. § 1004
    (b). It has approximately 27,000 members
    comprising active and retired Postal Service managers,
    supervisors, postmasters, and other professionals. Association
    members include employees whom the Postal Service
    categorizes as “Field,” “Area,” and “Headquarters” employees,
    as well as postmasters.
    1. Field Employees
    In September 2017, the Postal Service sent a proposed pay
    package to the Association for its “Field” EAS employees for
    fiscal years 2016 to 2019 (“Field Pay Package”). In the months
    following, the Postal Service consulted with the Association on
    the package via meetings, letters, and emails. The Postal
    Service rejected most of the Association’s recommendations
    and issued a final decision in summer 2018. It did not provide
    any reasons for rejecting the Association’s recommendations.
    The Association requested that the Federal Mediation and
    Conciliation Service convene a factfinding panel to review the
    Field Pay Package. It contended the Field Pay Package violated
    the Act’s requirements for setting adequate and reasonable pay
    differentials between supervisory and rank-and-file employees,
    
    id.
     § 1004(a), and for maintaining compensation and benefits
    comparable to those in the private sector, id. §§ 101(c),
    1003(a).
    The Association alleged the five percent “Supervisory
    Differential Adjustment” included in the package resulted in
    thousands of supervisors earning less than persons who they
    supervised because the Postal Service used a lower paid clerk
    position as the benchmark for this differential instead of a
    8
    higher paid (and more populous) carrier position. In addition,
    the Association claimed that many clerks and carriers received
    more total compensation than supervisors because they earned
    overtime at higher rates and after fewer hours than their
    supervisors, and they also received larger and more regular pay
    increases.
    Regarding comparability, the Association alleged that the
    Postal Service took no steps to compare compensation or
    benefits to the private sector before issuing the initial Field Pay
    Package. Only after the factfinding panel was convened did the
    Postal Service hire a consultant to evaluate pay (but not
    benefits or other compensation) for eight out of 1,000
    positions. The Association further alleged that the Postal
    Service did not consider high-wage locations or provide
    locality pay, refused to offer bonuses, and did not adjust pay in
    line with inflation or market increases as is done in the private
    sector.
    The factfinding panel held a two-day hearing in December
    2018 and issued its unanimous findings in a report in April
    2019. It found that the Supervisory Differential Adjustment
    method used by the Postal Service had, in many instances,
    resulted in unreasonable and inadequate pay differentials.
    Regarding comparability, the panel concluded that the Postal
    Service had violated the Act’s comparability requirement by
    issuing a final decision on the Field Pay Package without
    conducting any market survey into private compensation. It
    further concluded that the Postal Service method for
    determining pay increases, “as constructed and implemented
    by the [Postal] Service, does not satisfy the statutory criteri[on]
    of comparability.” Compl. ¶ 26, J.A. 11.
    The factfinding panel made recommendations for bringing
    compensation for supervisors into conformance with the Act.
    9
    See id. ¶ 68, J.A. 20. Approximately two weeks after the
    factfinding report was issued, the Postal Service rejected most
    of the recommendations and issued a final decision adhering to
    the differential and comparability conclusions in the original
    Field Pay Package.
    2. Area and Headquarters Employees
    The Association has 7,500 members in the “Area” and
    “Headquarters” categories. It claims that these members
    include “employees who perform supervisory and managerial
    responsibilities associated with a range of functions” such as
    those in “vehicle maintenance, shared services, financial, sales,
    and marketing.” Compl. ¶ 57, J.A. 18. On December 18, 2018,
    without having engaged in any consultation with the
    Association, the Postal Service issued a separate and “final”
    pay package for Area and Headquarters EAS employees
    through fiscal year 2019 (“Area and Headquarters Pay
    Package”).
    The package listed a small number of Headquarters and
    Area positions that the Postal Service does recognize as
    represented by the Association, but stated that the package
    “will not apply to those Headquarters and Area positions who
    are represented by the [Association].” Id. ¶ 62, J.A. 18-19. No
    pay package has been issued, nor has any consultation with the
    Association been undertaken, for those few Headquarters and
    Area employees the Postal Service recognizes as properly
    represented by the Association for the time period at issue.
    3. Postmaster Employees
    Finally, during this same period, the Association attempted
    to represent its postmaster members in negotiations regarding
    compensation. The Association has 4,100 postmaster
    10
    members. This is the second largest postmaster membership
    group in the country after the United Postmasters and
    Managers of America (“United Postmasters”), a recognized
    organization that also represents postmasters. The Postal
    Service rejected the Association’s request for recognition,
    saying that it “cannot lawfully recognize [the Association] as a
    representative of postmasters in addition to supervisors.”
    Compl. ¶ 79, J.A. 23. The Postal Service has steadfastly refused
    to consult with the Association on compensation for
    postmasters.
    4. Procedural History
    On July 26, 2019, the Association filed a complaint in the
    District Court. The complaint alleges that the Postal Service
    has violated section 1004(b) of the Postal Act by refusing to
    recognize or consult with the Association regarding
    postmasters and supervisors or other managerial personnel
    categorized as Area or Headquarters employees. It further
    claims that the Postal Service has violated the Act by failing to
    maintain any differential between many supervisors and the
    employees they oversee, and by failing to achieve and maintain
    compensation comparable to the private sector. Finally, it
    claims that the Postal Service failed to meet its obligation to
    “provide compensation . . . that will assure the attraction and
    retention of qualified and capable supervisory and other
    managerial personnel.” 
    39 U.S.C. § 1004
    (a). In response to the
    complaint, the Postal Service filed a motion to dismiss for
    failure to state a claim. United Postmasters intervened in
    support of the Postal Service’s position that the Association
    cannot lawfully represent postmasters and filed its own motion
    to dismiss.
    The District Court granted the motions to dismiss, finding
    that the Association failed to state a claim because it had not
    11
    shown that the Postal Service had violated a “clear and
    mandatory” statutory directive. See Nat’l Ass’n of Postal
    Supervisors, 
    2020 WL 4039177
    , at *7, J.A. 50. The
    Association now appeals.
    The Association raised no challenge in this appeal to the
    District Court’s dismissal of Count III of its complaint, related
    to the Postal Service’s obligation to ensure compensation that
    will attract and retain qualified supervisory personnel. See
    Compl. ¶¶ 93-99, J.A. 24-25; 
    39 U.S.C. § 1004
    (a). We
    therefore uphold the dismissal of Count III, any further
    challenge to which has been forfeited by the Association.
    II. ANALYSIS
    A. Standard of Review
    This court reviews de novo a District Court’s grant of a
    motion to dismiss for failure to state a claim. VoteVets Action
    Fund v. U.S. Dep’t of Veterans Affs., 
    992 F.3d 1097
    , 1104
    (D.C. Cir. 2021). We must “assume the truth of the plaintiff’s
    well-pleaded factual allegations in the complaint” and “draw[]
    all reasonable inferences in plaintiff’s favor.” Statewide
    Bonding, Inc. v. U.S. Dep’t of Homeland Sec., 
    980 F.3d 109
    ,
    114 (D.C. Cir. 2020); Capitol Servs. Mgmt., Inc. v. Vesta Corp.,
    
    933 F.3d 784
    , 788 (D.C. Cir. 2019).
    B. Availability of Judicial Review
    The actions of the Postal Service are expressly “exempt
    from review under the Administrative Procedure Act”
    (“APA”). N. Air Cargo v. USPS, 
    674 F.3d 852
    , 858 (D.C. Cir.
    2012); see also 39 U.S.C § 410(a) (“[T]he provisions of
    chapter[] . . . 7 of title 5 [the APA], shall [not] apply to the
    exercise of the powers of the Postal Service.”). However, “the
    12
    case law in this circuit is clear that judicial review is available
    when an agency acts ultra vires,” or outside of the authority
    Congress granted. Aid Ass’n for Lutherans, 
    321 F.3d at 1173
    .
    Review for ultra vires acts rests on the longstanding principle
    that if an agency action is “unauthorized by the statute under
    which [the agency] assumes to act,” the agency has “violate[d]
    the law” and “the courts generally have jurisdiction to grant
    relief.” Am. Sch. of Magnetic Healing v. McAnnulty, 
    187 U.S. 94
    , 108 (1902); see also Chamber of Com. v. Reich, 
    74 F.3d 1322
    , 1327-28 (D.C. Cir. 1996).
    In line with this precedent, we have repeatedly held that
    Postal Service “actions are reviewable to determine whether it
    has acted in excess of its statutory authority.” N. Air Cargo,
    
    674 F.3d at 858
    ; see also National Association, 
    602 F.2d at 432
    ; Aid Ass’n for Lutherans, 
    321 F.3d at 1173
    ; Sears, Roebuck
    & Co. v. USPS, 
    844 F.3d 260
    , 265 (D.C. Cir. 2016). While a
    court “can defer to the exercise of administrative discretion on
    internal management matters, . . . [we] cannot abdicate [our]
    responsibility to insure compliance with congressional
    directives setting the limits on that discretion.” National
    Association, 
    602 F.2d at 432
    . In evaluating decisions by the
    Postal Service, “[t]he judicial role is to determine the extent of
    the agency’s delegated authority and then determine whether
    the agency has acted within that authority.” 
    Id.
     Similarly, “[a]n
    agency construction of a statute cannot survive judicial review
    if [it] reflects an action that exceeds the agency’s authority.”
    Aid Ass’n for Lutherans, 
    321 F.3d at 1174
    .
    The Postal Service does not contest that ultra vires review
    of its decisions is available. Br. for Appellee 17, 27. Rather, it
    argues that the narrow scope of non-APA review precludes the
    Association’s claims in this case because the statutory
    provisions at issue are not “clear and mandatory” limitations
    on the Postal Service’s authority enforceable through ultra
    13
    vires review. 
    Id.
     at 24-25 (citing Leedom v. Kyne, 
    358 U.S. 184
    ,
    188 (1958)), 30-31. The Postal Service contends that because
    the statutory language states that “[i]t shall be the policy of the
    Postal Service” to provide pay differentials and comparable
    compensation, Congress intended these provisions to be
    “simply [some] of many (often conflicting) ‘policy’ goals
    noted in the statute.” 
    39 U.S.C. §§ 1003
    (a), 1004(a) (emphasis
    added); Br. for Appellee 18, 30-31. The Postal Service suggests
    that Congress’s use of the word “policy” indicates that these
    provisions are merely “advisory goals” that cannot be enforced.
    Br. for Appellee 31. We disagree because the Postal Service’s
    position is directly at odds with our precedent.
    Many years ago, in our decision in National Association,
    we made it absolutely clear that the pay differential,
    comparability requirements, and requirement to consult in the
    Postal Act place clear limits on the agency’s authority and are
    subject to non-APA review. 
    602 F.2d at 432, 435, 439, 440
    .
    National Association remains good law and controls in this
    case. See Aid Ass’n for Lutherans, 
    321 F.3d at 1173-74
    (reaffirming central holdings in National Association).
    The statutory provisions at issue in this case contain
    explicit language stating what the Postal Service “shall” do. 
    39 U.S.C. §§ 101
    (c), 1003(a), 1004(a), 1004(b). That language is
    undoubtably mandatory. See Kingdomware Techs., Inc. v.
    United States, 
    579 U.S. 162
    , 172 (2016) (“‘shall’ is
    ‘mandatory’ and ‘normally creates an obligation impervious to
    judicial discretion’” (quoting Lexecon Inc. v. Milberg Weiss
    Bershad Hynes & Lerach, 
    523 U.S. 26
    , 35 (1998))). Congress’s
    inclusion of a factfinding panel tasked with reviewing Postal
    Service compensation policies to ensure they are “consistent
    with the policies of this title, including sections 1003(a) and
    1004(a)” is further evidence that Congress intended its stated
    14
    directives to be observed by the Postal Service. 
    39 U.S.C. § 1004
    (f)(3)(A).
    Congress’s use of the word “policy” in a statute does not
    presumptively make a directive voluntary. Rather, while
    Congress may choose to commit certain policy decisions to an
    agency’s discretion, see Chevron, U.S.A., Inc. v. Nat. Res. Def.
    Council, Inc., 
    467 U.S. 837
    , 865-66 (1984), here Congress
    expressly removed certain policy choices from the Postal
    Service by directing that “[i]t shall be the policy” of the agency
    to ensure a differential and comparability, see 
    39 U.S.C. §§ 1003
    (a), 1004(a). Congress effectively mandated certain
    policies to be followed by the Postal Service, leaving no
    discretion for the agency to do otherwise.
    Finally, as noted above, the Postal Service’s
    characterization of what constitutes a “clear and mandatory”
    statutory provision that is reviewable for ultra vires acts is
    patently at odds with our governing precedent. The Postal
    Service is correct that a challenged action must “contravene[]
    a clear and specific statutory mandate” to be susceptible to
    ultra vires review. Nat’l Air Traffic Controllers Ass’n AFL-
    CIO v. Fed. Serv. Impasses Panel, 
    437 F.3d 1256
    , 1264 (D.C.
    Cir. 2006). In Leedom v. Kyne, the seminal case affirming the
    availability of ultra vires review, the Court held that a “clear
    and mandatory” statutory provision is judicially enforceable.
    
    358 U.S. at 188
    . And the case law following Leedom confirms
    that the “clear and mandatory” standard subsumes review of
    claims involving “positive statutory commands,” Nat’l Air
    Traffic Controllers Ass’n AFL-CIO, 
    437 F.3d at 1263
    ,
    questions of statutory interpretation, Aid Ass’n for Lutherans,
    
    321 F.3d at 1173
    , and questions regarding whether an agency
    decision was supported by a contemporaneous justification, N.
    Air Cargo, 
    674 F.3d at 859-60
    ; see also Sears, Roebuck & Co.,
    844 F.3d at 265 (describing claims subject to non-APA
    15
    review). So long as a statutory provision plainly delineates the
    outer limits of agency authority and Congress has not expressly
    precluded judicial review, the provision may be susceptible to
    review for ultra vires acts that clearly violate its terms. See
    Chamber of Com., 
    74 F.3d at 1327-28
    .
    In contrast, we have held that vague statutory provisions,
    such as one that requires an agency to use “appropriate data” to
    calculate a payment amount, are not sufficiently clear and
    mandatory to warrant non-APA review. DCH Reg’l Med. Ctr.
    v. Azar, 
    925 F.3d 503
    , 509-10 (D.C. Cir. 2019); see also Nyunt
    v. Broad. Bd. of Governors, 
    589 F.3d 445
    , 449 (D.C. Cir. 2009)
    (holding that a statutory provision requiring an agency to hire
    “suitably qualified” U.S. citizens was not subject to ultra vires
    review). Unlike the statutory requirements in this case, those
    ambiguous provisions lack discernible standards by which a
    court can identify a limit to agency authority.
    The Postal Service also argues that judicial review of
    Postal Service compensation decisions should be foreclosed
    because Congress included a provision for factfinding in the
    Act. In other words, the Postal Service suggests that the
    factfinding dispute resolution process supplants the need for
    judicial review. Br. for Appellee 27-29; see § 1004(f)–(g). The
    conclusion urged by the Postal Service does not follow from its
    starting premise. “The history of the Postal Act indicates that
    Congress contemplated a very restricted judicial role in the
    Postal Service’s compensation decisions” but “[i]t does not
    present the kind of evidence necessary to foreclose review
    altogether.” National Association, 
    602 F.2d at 432
    ; see also Bd.
    of Governors of Fed. Rsrv. Sys. v. MCorp Fin., Inc., 
    502 U.S. 32
    , 44 (1991) (“only upon a showing of ‘clear and convincing
    evidence’ of a contrary legislative intent should the courts
    restrict access to judicial review” (quoting Abbott Labs. v.
    Gardner, 
    387 U.S. 136
    , 141 (1967))). Congress’s addition of
    16
    the dispute resolution process in 1980, which it discussed as a
    means to reduce litigation but not supplant judicial review,
    does not alter that conclusion. See S. Rep. No. 96-856, at 4
    (1980) (“It is the committee’s intention to develop a dispute
    procedure which will make it more likely the parties can
    resolve their differences through improved consultation, rather
    than through the courts.”).
    In sum, the Postal Act’s requirements that the Postal
    Service “shall” consult with recognized organizations,
    maintain “adequate and reasonable differentials in rates of pay”
    between supervisors and clerks and carriers, and “achieve and
    maintain compensation for its officers and employees
    comparable to the rates and types of compensation paid in the
    private sector” are clear and mandatory, enforceable provisions
    subject to review for ultra vires acts. 
    39 U.S.C. §§ 101
    (c),
    1003(a), 1004(a), (b).
    C. Pay Differential Requirement per § 1004(a) and
    Comparability Requirement per §§ 101(c), 1003(a)
    We turn now to the Association’s claim that the Postal
    Service violated the Act by failing to maintain a supervisory
    pay differential or conduct a comparability analysis with
    respect to the Field Pay Package. In considering the issues in
    this case, we remain mindful that “[r]eviewability and the
    scope of review are two separate questions.” National
    Association, 
    602 F.2d at 432
    . “[T]he Postal Service has broad
    discretion in setting compensation levels,” but this “does not
    mean . . . that its decisions are entirely insulated from judicial
    surveillance.” 
    Id.
     As we have already explained, “[t]he judicial
    role is to determine the extent of the agency’s delegated
    authority and then determine whether the agency has acted
    within that authority.” 
    Id.
    17
    1. The Postal Service Acted Ultra Vires by Failing to
    Maintain “Some” Pay Differential
    The Postal Act requires that the Postal Service “provide
    adequate and reasonable differentials in rates of pay between
    employees in the clerk and carrier grades in the line work force
    and supervisory and other managerial personnel.” 
    39 U.S.C. § 1004
    (a). The Postal Service contends that it has satisfied the
    pay differential requirement in section 1004(a) through its
    Supervisory Differential Adjustment, which sets a five percent
    differential between supervisors’ pay and the pay of clerks and
    carriers. Br. for Appellee 32-33. However, the Association
    argues that the method used to implement the differential is
    flawed and, as a result, “thousands of EAS employees earn[]
    less than the craft workers they supervise.” Compl. ¶ 37, J.A.
    13.
    As we determined in National Association, “[t]he Postal
    Act does require some differential, and requires that that
    differential be adequate and reasonable.” 
    602 F.2d at 435
    .
    “[T]he differential guarantee” is not “a meaningless, empty
    promise, one which the Postal Service can ignore at will.” 
    Id.
    Though a differential must be present, the Postal Service has
    broad discretion to decide its size and how it is computed. 
    Id. at 433
     (“Congress chose . . . to leave the precise differential to
    the discretion of the agency.”). Accordingly, “a court can
    compel the Postal Service to consider and fulfill the differential
    requirement, but it cannot substitute its own judgment of what
    is adequate and reasonable for that of the Postal Service.” 
    Id. at 435
     (emphases added).
    In alleging the Postal Service provided no differential in
    pay for thousands of supervisory employees, the Association
    thus states a claim that the Postal Service has exceeded its
    statutory authority. It is the responsibility of the Postal Service
    18
    to indicate that it has established “some differential.” 
    Id.
     Here,
    such a showing has not been made.
    2. The Postal Service Acted Ultra Vires by Failing to
    Consider Private Sector Pay and Achieve Comparability
    Section 101(c) directs that, “[a]s an employer, the Postal
    Service shall achieve and maintain compensation for its
    officers and employees comparable to the rates and types of
    compensation paid in the private sector of the economy.” 
    39 U.S.C. § 101
    (c). Again, in section 1003(a) Congress instructed
    that “[i]t shall be the policy of the Postal Service to maintain
    compensation and benefits for all officers and employees on a
    standard of comparability to the compensation and benefits
    paid for comparable levels of work in the private sector of the
    economy.” 
    Id.
     § 1003(a) (emphases added).
    Appellant alleges the Postal Service did not study private
    compensation or benefits before issuing its Field Pay Package.
    Only after the final package was issued and the factfinding
    panel was convened did the Postal Service inquire into private
    pay rates. Even then, it only looked at pay rates for eight out of
    a thousand positions included in the Field Pay Package. It did
    not study total compensation or benefits, as specified in the
    Act, for any positions. Compl. ¶ 23, J.A. 10. The result is
    compensation the Association alleges is not “comparable” to
    the private sector. The Postal Service counters that it met its
    statutory requirements with the pay study of eight positions in
    addition to its “internal expertise.” Br. for Appellee 33-34.
    In National Association, we determined that the Act’s
    “provisions require that the Postal Service set its compensation
    levels by reference, inter alia, to the compensation paid” in the
    private sector. 
    602 F.2d at 440
    . We described the comparable
    pay provision as one of several “requirements” and said that
    19
    the Postal Service must, at minimum, “consider[] all the factors
    as directed by the Postal Act,” 
    id. at 440-41
    , and “arrive[] at a
    good faith judgment,” 
    id. at 435
    . Thus, to meet its statutory
    obligation, the Postal Service must (1) consider private sector
    compensation and benefit rates in setting compensation for
    “all” employees, and (2) show a good faith determination that
    compensation and benefits are comparable. In order to set
    compensation “by reference . . . to” private compensation and
    benefit rates, 
    id. at 440
    , the Postal Service must know what
    those rates are. In addition, the statute’s directive that the Postal
    Service “maintain” comparable compensation entails some
    showing that it is keeping pace with rising private sector rates.
    Within these bounds, the Postal Service has broad
    discretion to “achieve and maintain” comparability to the
    private sector using the means it sees fit. See 
    id. at 432
    (recognizing that the Postal Service “must have the freedom
    . . . to control costs” in an efficient manner). The statute does
    not specify how similar the rates must be, the manner in which
    rates are compared, or the method of study of private sector
    rates. However, the Postal Service cannot choose to ignore
    private sector compensation rates altogether, and it must
    demonstrate in good faith that it has “achieve[d] and
    maintain[ed]” comparability in line with Congress’s directives.
    
    39 U.S.C. § 101
    (c).
    Here, the Postal Service has not shown that it considered
    private sector compensation and benefits nor explained how it
    has achieved comparability in its rates. It has not provided a
    justification for its conclusion that comparability has been
    achieved, nor explained its resolution of factors built into the
    comparability requirement like locality pay and market rate
    increases in pay. Absent a reasoned explanation showing
    otherwise, the Postal Service’s belated and limited look at pay
    – and not total compensation or benefits – for only eight of
    20
    1,000 positions plainly fails to meet its statutory obligation to
    achieve comparability in good faith “for all officers and
    employees.” 
    Id.
     § 1003(a).
    D. Requirement to Consult per § 1004(b)
    Finally, we consider the Association’s claim that the Postal
    Service acted ultra vires by refusing to consult with the
    Association about pay policies relating to Association
    members who (1) are categorized as “Area” or “Headquarters”
    employees or (2) are postmasters. “Section 1004(b) provides
    that representatives of supervisory and other managerial
    personnel [who are not subject to collective-bargaining
    agreements under the Act] are entitled to participate directly in
    the development of Postal Service compensation programs and
    policies.” National Association, 
    602 F.2d at 436
    ; 
    39 U.S.C. § 1004
    (b). In National Association, we found that, to meet this
    requirement, “the Postal Service must discuss its proposed
    compensation policies with the Association[] before those
    policies go into effect, and . . . that such discussions must be
    conducted in a meaningful, good faith manner.” 
    602 F.2d at 436
    . Ultimately, “if the Postal Service gives the Association[]
    an opportunity to analyze and criticize proposed compensation
    decisions and the materials on which those decisions are based,
    and then supplies the Association[] with reasons for rejecting
    any criticisms in advance of a final decision, then the Postal
    Service has met its statutory obligations under section 1004(b)
    and the judicial function is at an end.” 
    Id. at 439
    . It follows that
    refusal by the Postal Service to consult at all on compensation
    for eligible employees constitutes a violation of the mandatory
    consultation provision.
    The Postal Service has refused to consult with the
    Association regarding compensation for most workers it deems
    “Area” or “Headquarters” employees, as opposed to Field
    21
    employees. Additionally, it has refused to consult with the
    Association about postmasters’ compensation. The
    Association contends the statute entitles it to represent these
    employees in pay policy negotiations and, accordingly, that the
    Postal Service has acted outside the scope of its authority by
    refusing to do so. Finally, it claims that the Postal Service failed
    to provide it with reasons for rejecting its recommendations.
    1. The Postal Service Acted Ultra Vires by Refusing to
    Consult Regarding Area and Headquarters Employees
    Without Providing Any Explanation
    The Postal Service recognizes the Association as an
    organization representing Field EAS employees, but not most
    Area and Headquarters employees. The reasoning provided by
    the Postal Service for this position is sparse and self-serving.
    The Postal Service simply asserts, with no evidence to support
    its claim, that Area and Headquarters employees are not
    “supervisory” or “other managerial employees” under the Act.
    Br. for Appellee 10, 43-44; see 
    39 U.S.C. § 1004
    (b). According
    to the Postal Service, these employees are “professional,
    technical, administrative[,] and clerical employees” and,
    therefore, not entitled to representation. Br. for Appellee 10.
    No further explanation has been provided as to how the Postal
    Service reached this conclusion or why certain EAS employees
    qualify for representation and others do not. Compl. ¶ 63, J.A.
    19. As a result, most Area and Headquarters EAS employees
    have been denied representation by the Association in the pay
    policy process.
    The Association argues that the term “supervisory and
    other managerial employees,” as used in the Act, is
    synonymous with EAS employees. Corrected Br. for Appellant
    41. It points out that the Area and Headquarters employees in
    question are neither executives nor members of collective
    22
    bargaining units, but rather an in-between group that
    undertakes the supervisory and managerial functions of
    assuring that the policies set by the executives are carried out
    by the craft employees. 
    Id.
     The designations “Field,”
    “Headquarters,” and “Area,” it notes, have been created by the
    agency and do not appear in the Act. 
    Id. at 43
    . The Association
    thus alleges that the Postal Service has acted outside the scope
    of its authority by refusing to consult on pay policy for Area
    and Headquarters employees.
    Under ultra vires review, a statutory construction by an
    agency is “impermissible” if it is “utterly unreasonable.” Aid
    Ass’n for Lutherans, 
    321 F.3d at 1174
    . “We ‘owe a measure of
    deference to the agency’s own construction of its organic
    statute, but the ultimate responsibility for determining the
    bounds of administrative discretion is judicial.’” 
    Id. at 1173
    (quoting National Association, 
    602 F.2d at 432-33
    ). Moreover,
    an agency acts ultra vires when its decision is not supported by
    “a contemporaneous justification by the agency itself,” but
    only a “post hoc explanation [by] counsel.” N. Air Cargo, 
    674 F.3d at
    860 (citing SEC v. Chenery, 
    318 U.S. 80
     (1943)).
    Here, we cannot assess whether the Postal Service’s claim
    regarding “supervisory and other managerial employees” is
    plausible because the Postal Service has failed to offer any
    support for its position. “When an administrative agency sets
    policy, it must provide a reasoned explanation for its action.
    That is not a high bar, but it is an unwavering one.” Judulang
    v. Holder, 
    565 U.S. 42
    , 45 (2011). In this case, we do not know
    the criteria by which employees were categorized as
    “professional, technical, administrative, [or] clerical
    employees,” nor how their job functions differ from those the
    Postal Service deems “supervisory and other managerial
    employees.” We have no insight into the Postal Service’s
    classification of any particular role. Moreover, the thin
    23
    reasoning the Postal Service has supplied was provided for the
    first time in this litigation by counsel. Corrected Br. for
    Appellant 47-50.
    What is clear is that the Postal Service may not arbitrarily
    exclude employees from representation they are entitled to
    under the Act. See Leedom, 
    358 U.S. at 189
     (finding an agency
    action ultra vires that “deprived . . . employees of a ‘right’
    assured to them by Congress”). The Postal Act plainly
    obligates the agency to consult with respect to compensation
    for supervisory and other managerial employees regardless of
    their designation by the Postal Service as “Field,”
    “Headquarters,” or “Area” employees. Moreover, section
    1004(b) indicates that employees are either entitled to
    representation by a union for the purposes of collective
    bargaining under chapter 12 of the Act, or permitted
    representation by a “program for consultation with recognized
    organizations of supervisory and other managerial personnel.”
    
    39 U.S.C. § 1004
    (b).
    We reject the Postal Service’s position that it may deny
    employees the representation rights granted by Congress by
    simply declaring employees not to be supervisory or other
    managerial personnel. It draws on a definitional provision in
    the statute to argue that “members of the supervisors’
    organization” are limited to employees “who are recognized
    under an agreement between the Postal Service and the
    supervisors’ organization as represented by such organization.”
    Br. for Appellee 41 (quoting 
    39 U.S.C. § 1004
    (i)(2)). The
    Postal Service proffers that if it does not agree to recognize
    employees as “members,” then those employees are not
    entitled to representation under the Act. 
    Id.
     This is a specious
    argument.
    24
    Indeed, the Association represented at oral argument that
    no such “agreement between the Postal Service and the
    supervisors’ organization” has been in effect since 1981. The
    Postal Service did not dispute this claim. If the Postal Service’s
    position regarding enforcement of the requirement to consult
    were accepted, then all Association members would be without
    consultation rights. Obviously, this would be an untenable
    situation. Therefore, to support its claim that certain Area and
    Headquarters employees do not qualify for representation by
    the Association, the Postal Service must demonstrate that the
    job functions of these employees are not supervisory or “other
    managerial” in nature. 
    39 U.S.C. § 1004
    (b).
    The Postal Service further claims that the Association has
    not plausibly alleged a violation of section 1004(b) because “it
    has not even attempted to allege facts demonstrating that it
    represents any discrete set of EAS employees covered by the
    [Area and Headquarters] Pay Package.” Br. for Appellee 44.
    This claim is belied by the record. The Association has alleged
    that it represents 7,500 employees throughout the country
    whom the Postal Service categorizes as “Headquarters” or
    “Area” employees, and claimed that such employees perform
    supervisory and managerial responsibilities. Compl. ¶ 57, J.A.
    18. It has also contended that the Postal Service “failed entirely
    to consult” with the Association regarding compensation
    policies for all Headquarters and Area employees, and that the
    Postal Service refuses to recognize its representation of many
    of these employees. 
    Id. ¶¶ 59-63
    , J.A. 18-19.
    For those few Area and Headquarters employees the Postal
    Service recognizes as represented by the Association, the
    Postal Service has exceeded its authority by failing to consult.
    At oral argument, the Postal Service attempted to argue that
    because it expressly excluded those employees from the
    general Area and Headquarters Pay Package and did not issue
    25
    any 2016 to 2019 pay package for these employees, it did not
    breach its obligation to consult. See also 
    id. ¶¶ 61-62
    , J.A. 18-
    19. This reeks of chicanery. The Postal Service may not evade
    its statutory obligation to consult by excluding employees from
    its pay packages and refusing to promulgate any pay policies
    for them. See 
    39 U.S.C. § 1004
    (e)(1) (requiring the Postal
    Service to propose a pay package for members of a supervisory
    organization within forty-five days of reaching a collective
    bargaining agreement for rank-and-file employees).
    As things now stand, it appears that the Postal Service is
    of the view that the majority of Area and Headquarters
    employees are not entitled to representation by the Association
    because they are not “supervisory” or “other managerial
    employees.” 
    Id.
     § 1004(b). However, the Postal Service’s
    position reflects nothing more than an unsupported assertion
    that is strongly contested by the Association. On remand, the
    District Court must determine which of these employees have
    been improperly excluded from the right to representation
    granted in section 1004(b).
    2. The Postal Service’s Refusal to Consult with the
    Association Regarding Postmasters is Ultra Vires
    Section 1004(b) sets the requirements for a group to
    become a “recognized organization[]” that is “entitled to
    participate directly” in the planning and development of
    compensation policy for its members. 
    39 U.S.C. § 1004
    (b). In
    order to become a recognized organization, a group must prove
    that it is either (1) a supervisory organization that represents a
    majority of supervisors; (2) an organization (other than an
    organization representing supervisors) that represents at least
    twenty percent of postmasters; or (3) a managerial organization
    (other than an organization representing supervisors or
    postmasters) that represents a substantial percentage of
    26
    managerial employees. 
    Id.
     Once an organization has satisfied
    any one of these three standards, “such organization . . . shall
    be entitled to participate directly” in the development of
    compensation policies “relating to supervisory and other
    managerial employees.” 
    Id.
    The Postal Service contends this provision mandates that
    separate, mutually exclusive organizations represent only
    supervisory employees or postmasters or managerial
    employees. Br. for Appellee 38-40. Because the Association
    represents supervisory employees, the Postal Service insists, it
    cannot also represent postmasters. The Postal Service relies on
    this construction to justify its refusal to consult with the
    Association regarding its 4,100 postmaster members. Because
    there is currently no freestanding organization to represent
    managerial employees, who are instead represented by the
    Association and recognized organizations of postmasters, this
    interpretation would deny all managerial employees
    representation in the development of pay policies. Corrected
    Br. for Appellant 47; Reply Br. for Appellant 4. Intervenor
    United Postmasters has endorsed the Postal Service’s position.
    See Br. for Intervenor Def.-Appellee 8.
    Once again, the question before us is whether “the
    disputed [agency interpretation] defies the plain language of a
    statute or . . . the agency’s construction is utterly unreasonable
    and thus impermissible.” Aid Ass’n for Lutherans, 
    321 F.3d at 1174
    . As we explain below, the Postal Service’s construction
    requires adding text to the Act that Congress pointedly omitted.
    We therefore hold that the Postal Service’s position is contrary
    to the plain language of the Act.
    The carefully worded language of section 1004(b) presents
    different requirements for supervisory organizations than it
    does for postmaster or managerial organizations. In requiring
    27
    that a supervisory organization represent “a majority of
    supervisors,” Congress made clear that there can be only one
    such organization authorized to consult on behalf of
    supervisors. 
    39 U.S.C. § 1004
    (b). Multiple organizations
    cannot each represent “a majority of supervisors,” only one
    can. However, because any given postmasters’ organization
    must only represent “at least 20 percent of postmasters,” as
    many as five postmasters’ organizations could qualify under
    the Act. Likewise, a managerial organization must only
    represent “a substantial percentage of managerial employees,”
    so many managerial organizations could qualify. 
    Id.
     This
    distinction sets the supervisory organization apart from the
    start.
    While postmasters’ organizations are expressly prohibited
    from also representing supervisors, and managerial
    organizations are prohibited from also representing supervisors
    or postmasters, no such restriction is placed on supervisory
    organizations. Supervisory organizations – beyond having to
    show they represent a majority of supervisors – are not limited
    in who else they can represent. This precisely crafted statute
    thus presents a “nested” structure, in which Congress placed
    deliberate restrictions on postmasters’ organizations (which
    may not represent supervisors) and on managerial
    organizations (which may not represent either supervisors or
    postmasters), but conspicuously left the supervisory
    organization free to represent either postmasters or managers
    alongside supervisors. See Figure 1, infra. “[W]hen Congress
    includes particular language in one section of a statute but
    omits it in another . . . , it is generally presumed that Congress
    acts intentionally and purposely in the disparate inclusion or
    exclusion.” Collins v. Yellen, 
    141 S. Ct. 1761
    , 1782 (2021)
    (quoting Barnhart v. Sigmon Coal Co., 
    534 U.S. 438
    , 452
    (2002)). The Act does not say that a supervisory organization
    cannot represent postmasters. Therefore, the Postal Service’s
    28
    construction of the statute would require us to write a
    restriction into the text that is not there. We will not do that.
    Alabama v. North Carolina, 
    560 U.S. 330
    , 352 (2010) (“We do
    not—we cannot—add provisions to a federal statute.”).
    Managers
    Postmasters
    Supervisors
    Figure 1: Section 1004(b)’s Nested Structure
    This precise enactment of statutory language on the part of
    Congress was no accident. First, it reflects the history of the
    Act and the representative organizations that were in existence
    when the Act was first passed. When the consultation process
    was established in 1970, the Association represented “a
    majority of supervisors” and was thus the sole recognized
    supervisory organization. See National Association, 
    602 F.2d at 438
     (discussing early consultation agreements between the
    Association and Postal Service). The original statute made no
    reference to postmasters or postmaster organizations, but
    permitted “managerial organization[s] (other than an
    organization representing supervisors) [that] represent[] a
    substantial percentage of managerial employees.” Pub. L. No.
    91-375, 
    84 Stat. 719
    , 731 (1970). At that time, organizations
    29
    representing postmasters qualified for consultation as
    “managerial organization[s].” See National Association, 
    602 F.2d at
    426 n.7 (describing the National Association of
    Postmasters of the United States and the National League of
    Postmasters of the United States as recognized organizations
    under § 1004(b) before the statute mentioned postmasters’
    organizations). Postmasters were thus understood to be a subset
    of “supervisory and other managerial” employees. No
    standalone organization for managerial employees existed at
    the Act’s inception, nor does one exist today. Corrected Br. for
    Appellant 47; Reply Br. for Appellant 4.
    In 1980, Congress added to the Act the detailed
    participation process and factfinding panel for resolving
    disputes now codified in 
    39 U.S.C. § 1004
    (c)–(g). Pub. L. No.
    96-326, 
    94 Stat. 1023
     (1980). However, as originally enacted,
    these provisions permitted only the supervisory organization to
    engage in these processes. 
    Id.
     “Managerial organizations,” then
    consisting of organizations representing postmasters, could
    consult but were excluded from protection of the participation
    requirements and dispute resolution process. S. Rep. No. 108-
    112, at 3 (2003). This “left postmasters with no avenue to
    resolve disagreements with Postal Headquarters” and “limited
    their ability to have meaningful discussions with Postal
    Headquarters on issues relating to pay and benefits.” 
    Id.
    In 2003, Congress amended the Postal Act to allow
    postmasters’ organizations access to the same participation and
    dispute resolution procedures available to supervisory
    organizations. See Postmasters’ Equity Act of 2003, Pub. L.
    No. 108-86, 
    117 Stat. 1052
    . It defined “postmasters’
    organization” in the Act, added the twenty percent threshold
    for recognition, and afforded postmasters’ groups access to the
    dispute resolution process. 
    Id. at 1052-53
    . Congress left in
    30
    place the catchall category of “managerial organization,” even
    though no such separate group existed.
    Rather than institute a rigid separation, the 2003
    amendment confirms that postmasters are managers:
    “‘postmaster’ means an individual who is the manager in
    charge of the operations of a post office, with or without the
    assistance of subordinate managers or supervisors.” 
    39 U.S.C. § 1004
    (i)(3). Notably, when Congress amended the Act in
    2003, it did not add a restriction that would prevent postmasters
    who were already members of the Association from continuing
    membership in that larger umbrella group. Rather, Congress
    took care to preserve these employees’ access to membership
    in the general supervisory organization, while ensuring that
    postmasters’ organizations could additionally avail themselves
    of the dispute resolution measures.
    Importantly, Congress safeguarded the ability of
    managerial personnel – who had no organization of their own
    – to seek representation via either an existing recognized
    supervisory organization or postmasters’ organization. The
    resulting structure gives Postal Service managers and
    postmasters the choice to throw in their lot with the general
    supervisory organization, which represents the interests of all
    supervisory and managerial employees including postmasters,
    or, if they prefer, to join their own, category-specific
    negotiating body.
    It is noteworthy that the Postal Service’s position that it
    “cannot lawfully recognize [the Association] as a
    representative of postmasters in addition to supervisors,”
    Compl. ¶ 79, J.A. 23, is belied by its own practice. At oral
    argument, counsel for the Postal Service acknowledged that the
    agency has consulted with the Association (and Intervenor
    United Postmasters and Managers of America) on
    31
    compensation policies for managerial employees and
    continues to do so today. The parenthetical restrictions in the
    statute cannot both be read to permit these organizations to
    represent managerial employees but to deny supervisory
    organizations the ability to represent postmasters. The Postal
    Service’s proposed interpretation that these groups must be
    mutually exclusive presents an “utterly unreasonable”
    interpretation of the statute that contravenes Congress’s careful
    wording and would deny thousands of managerial employees
    access to the protections of the Act as Congress intended. Aid
    Ass’n for Lutherans, 
    321 F.3d at 1174
    .
    In sum, it is undisputed that the Association qualifies as a
    recognized organization under the Postal Act because it
    represents “a majority of supervisors.” 
    39 U.S.C. § 1004
    (b);
    Br. for Appellee 7-8. Having met this threshold requirement, it
    is therefore “entitled to participate directly in the planning and
    development of pay policies . . . relating to supervisory and
    other managerial employees.” 
    39 U.S.C. § 1004
    (b). Its
    postmaster members, described in the Act as “manager[s] . . .
    with or without the assistance of subordinate managers or
    supervisors,” 
    id.
     § 1004(i)(3), plainly fall into the broad
    category of “supervisory and other managerial employees” the
    Association may represent, id. § 1004(b). It follows that section
    1004(b) requires the Postal Service to consult with the
    Association regarding compensation for these employees.
    3. The Postal Service Must Give Reasons for Rejecting the
    Association’s Recommendations
    Finally, the Association alleges the Postal Service did not
    supply reasons for rejecting its recommendations on the Field
    Pay Package before issuing a final decision. Compl. ¶¶ 53-54,
    J.A. 17. The plain text of section 1004(b) and our precedent
    mandate that the Postal Service must “suppl[y] the
    32
    Association[] with reasons for rejecting any criticisms in
    advance of a final decision.” National Association, 
    602 F.2d at 439
    . The Postal Service exceeded the scope of its statutory
    authority by issuing the Field Pay Package without first
    explaining why it was rejecting the Association’s
    recommendations.
    III. CONCLUSION
    For the reasons set forth above, we hold that the
    Association plausibly alleges that the Postal Service exceeded
    the scope of its delegated authority on multiple counts.
    Accordingly, the judgment of the District Court is reversed and
    the case is remanded for further proceedings consistent with
    this opinion.