16:0377(61)AR - NTEU and Customs Service -- 1984 FLRAdec AR

[ v16 p377 ]
The decision of the Authority follows:

 16 FLRA No. 61
                                            Case No. 0-AR-521
    This matter is before the Authority on exceptions to the award of
 Arbitrator Ann Harmon Miller filed by the Agency under section 7122(a)
 of the Federal Service Labor-Management Relations Statute and part 2425
 of the Authority's Rules and Regulations.
    The dispute in this matter arose when the Agency directed the
 grievant, a Customs Inspector, to either terminate an alleged conflict
 of interest, which allegedly existed because the grievant's wife worked
 for a Customs brokerage firm, or face disciplinary action.  The
 Arbitrator found that the grievant's wife worked for the brokerage firm
 in a clerical capacity;  that she took no part in the firm's managerial
 or supervisory decisions;  that she was not empowered to transact
 business with Customs;  that she was not a licensed broker;  and that
 neither the grievant nor his wife had any financial interest in the
 firm.  The Arbitrator also noted that the Agency had determined in
 another situation where a Customs Inspector's wife worked in a clerical
 capacity for a broker that there was no conflict of interest and that
 the Agency failed to show how that situation was different from the
 instant dispute.  The Arbitrator rejected the Agency's assertions that
 the facts in this case presented either a direct conflict of interest or
 the appearance of such a conflict.  The Arbitrator concluded that the
 Agency violated the parties' collective bargaining agreement when it
 directed the grievant to terminate the alleged conflict or face
 disciplinary action.  As a remedy, the Arbitrator ordered the Agency to
 rescind the directive.
    In its exceptions, the Agency contends that the Arbitrator's award is
 contrary to law and regulation.  More specifically, the Agency contends
 that the award is contrary to Executive Order 11222 and regulations
 governing standards of conduct.
    Upon careful consideration of the entire record before the Authority,
 the Authority concludes that the Agency has failed to establish that the
 award is contrary to law or regulation.  Thus, E.O. 11222 and the
 implementing regulations relied upon by the Agency simply prohibit
 conduct by Federal employees which creates either a direct conflict of
 interest or the appearance of such a conflict.  It is clear that the
 Arbitrator carefully considered the pertinent provisions and the
 Agency's related arguments.  In its exceptions, reiterating arguments
 made before the Arbitrator, the Agency essentially asserts that the
 Arbitrator erred in concluding that there was no appearance of a