39:0346(25)NG - - NTEU and HHS, SSA, Office of Hearings and Appeals, Baltimore, MD - - 1991 FLRAdec NG - - v39 p346



[ v39 p346 ]
39:0346(25)NG
The decision of the Authority follows:


39 FLRA No. 25

FEDERAL LABOR RELATIONS AUTHORITY

WASHINGTON, D.C.

NATIONAL TREASURY EMPLOYEES UNION

(Union)

and

U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES

SOCIAL SECURITY ADMINISTRATION

OFFICE OF HEARINGS AND APPEALS

BALTIMORE, MARYLAND

(Agency)

0-NG-1714

DECISION AND ORDER ON NEGOTIABILITY ISSUES

February 1, 1991

Before Chairman McKee and Members Talkin and Armendariz

I. Statement of the Case

This case is before the Authority on a negotiability appeal filed by the Union under section 7105(a)(2)(E) of the Federal Service Labor-Management Relations Statute (the Statute). The case concerns the negotiability of eight provisions of a negotiated agreement which were disapproved by the Agency head under section 7114(c) of the Statute. One additional provision, identified as Article 37, Section 4(E), was withdrawn by the Union in its reply brief. Accordingly, that provision will not be addressed in this decision.

For the following reasons, we conclude that Provision 1, which requires that employees' performance be measured against established performance standards based on observable performance, is negotiable. We find that Provisions 2 and 3, which concern, respectively, the content of performance standards and requirements for evaluating employees' performance, are nonnegotiable because they directly interfere with management's rights to direct employees and to assign work under section 7106(a)(2)(A) and (B) of the Statute.

Provisions 4 through 8 concern, respectively, actions for unacceptable performance, disciplinary actions, adverse actions, the parties' negotiated grievance procedure, and an expedited arbitration procedure. Each of the five provisions applies to nonpreference eligible excepted service employees to the extent not prohibited by law and regulation. Inclusion of that category of employees within the provisions' coverage is consistent with applicable law. Accordingly, we find the provisions to be negotiable.

II. Provision 1

Article 37; Section 4(A):

A. In general: Performance standards [and] critical or noncritical elements must be consistent with the duties and responsibilities contained in the employee's position description. To the maximum extent feasible, appraisals of performance will be fair and accurate and relate to specific, written performance requirements. Employees will be measured against the established performance expectations based on observable performance.

[Only the underscored sentence of Provision 1 is in dispute.]

A. Positions of the Parties

The Agency asserts that the last sentence of Provision 1 determines the content of performance standards and, thereby, conflicts with management's rights to assign work and to direct employees under 5 U.S.C. º 7106(a)(2)(A) and (B) of the Statute. The Agency argues that the provision permits "arbitral review of management's determination of the content of the standards; i.e., whether the standards measure 'observable performance[.]'" Statement of Position at 2. The Agency relies on American Federation of Government Employees, Local 3748, AFL-CIO and Agricultural Research Service, Northern States Area, 20 FLRA 495 (1985) (Agricultural Research Service), affirmed sub nom. American Federation of Government Employees Local 3748, AFL-CIO v. FLRA, 797 F.2d 612 (8th Cir. 1986).

The Union contends that the Agency has misconstrued the intent and plain wording of Provision 1. The Union asserts that the Agency is not prevented from unilaterally establishing performance standards. According to the Union, the provision applies once the Agency has established standards, and the provision would "simply require the Employer to measure an employee's ability to meet such standards based upon 'observable performance.'" Reply Brief at 3. The Union states that it intends "[o]bservable performance" to mean "that the Employer must be able to discern, or to recognize in some fashion, an employee's performance and to evaluate such performance based upon the standards that have been established." Id. at 3-4. Additionally, the Union asserts that it

did not contemplate, nor did it distinguish in writing, any difference between direct versus indirect observation. It is the Union's position that such distinctions must be left to a case by case determination, based upon the individual performance expectations and the nature of the work itself.

Id. at 4.

The Union contends that the provision corresponds to 5 U.S.C. º 4302(b)(1), which requires that performance standards be based on objective criteria. In the Union's view, "it would be difficult to construct an 'objective' performance evaluation system that 'accurately evaluates job performance' on other than 'observable performance.'" Id. at 3 (emphasis in original).

Finally, the Union rejects the Agency's position that Provision 1 is nonnegotiable because it would subject the content of performance standards to arbitral review. Citing National Treasury Employees Union, Chapter 213 and 228 and United States Department of Energy, Washington, D.C., 32 FLRA 578 (1988) (Department of Energy), the Union states that "contract language which may open the door to arbitral review of the exercise of a management right does not necessarily have the effect of rendering such language nonnegotiable." Reply Brief at 4. Further, the Union points out that the Authority found a grievance, alleging that management violated applicable law when it established performance standards, to be arbitrable in Newark Air Force Station and American Federation of Government Employees, Local 221, 30 FLRA 616 (1987) (Newark Air Force Station).

B. Analysis and Conclusions

Management's rights to direct employees and to assign work under section 7106(a)(2)(A) and (B) of the Statute encompass the authority to identify critical elements of performance and to establish performance standards. National Federation of Federal Employees, Local 2096 and U.S. Department of the Navy, Naval Facilities Engineering Command, Western Division, 36 FLRA 834, 845 (1990) (NAFEC, Western Division), and case cited there. Proposals which restrict an agency's authority to determine the content of performance standards and critical elements directly interfere with management's rights to direct employees and to assign work. NAFEC, Western Division at 845, and American Federation of Government Employees, Local 3172 and U.S. Department of Health and Human Services, Social Security Administration, Vallejo District Office, 35 FLRA 1276, 1280-81 (1990) (SSA, Vallejo District Office).

On the other hand, proposals governing only the application of performance standards and critical elements do not conflict with management's rights to direct employees and to assign work. See, for example, NAFEC, Western Division at 846. Accordingly, the task in deciding the negotiability of Provision 1 "'is primarily one of determining, based on the record, whether [it] concern[s] substantive matters, such as the content of performance standards and critical elements, or whether [it] concern[s] the application of those standards and elements and other nonsubstantive matters such as procedures.'" Id. at 846 (quoting Patent Office Professional Association and Patent Trademark Office, Department of Commerce, 25 FLRA 384, 387 (1987)).

The disputed sentence of Provision 1 requires that employee performance ratings be based on "observable performance." In its reply brief, the Union states that the phrase would obligate the Agency "to discern, or to recognize in some fashion" an employee's performance and to evaluate that performance against the standards management has established. Reply Brief at 4. The Union points out that the inclusion of the phrase "observable performance" in the disputed sentence does not imply that the required observation must be direct. The Union states that whether observation should be direct or indirect, under the provision, is to be determined "based upon the individual performance expectations and the nature of the work itself." Id.

The Union's explanation is consistent with the provision's plain wording. Accordingly, we adopt that explanation in deciding the negotiability of the disputed sentence in Provision 1.

The Agency has cited no authority, nor is any apparent to us, to support its position that the rights to direct employees and to assign work under section 7106(a)(2)(A) and (B) extend to the evaluation of employees on other than discerned or perceived performance. In this regard, the Agency's reliance on Agricultural Research Service is misplaced. The provisions in that case required that all performance standards include specified characteristics. However, Provision 1 does not concern the characteristics of performance standards. Consequently, we reject the Agency's arguments and find that the provision does not directly interfere with the Agency's rights to direct employees and assign work.

Moreover, the Agency's concern that an arbitrator's judgment may be substituted for its own is not a basis for finding the provision to be nonnegotiable. In Newark Air Force Station, 30 FLRA at 635, the Authority noted that "the concern with arbitrators' 'substituting their judgment' for that of management presents no basis on which to preclude the arbitrability of grievances challenging the legality of performance standards before an employee is evaluated against those standards." Rather, the Authority observed that the "question of any impermissible arbitral interference with management's rights must be directed to the merits, including remedy, of an arbitration decision relating to performance standards' consistency with law." Id. at 636.

As Provision 1 does not conflict with the Agency's rights to direct employees and to assign work, the provision is negotiable.

III. Provision 2

Article 37; Section 4(C):

C. Performance Standards: Performance standards, based on requirements of the employee's position must be written at the Marginally Successful, Fully Successful, and Excellent level for rating performance on each job element in the plan. To the maximum extent feasible, this standard must be:

1. Objective, i.e., free from personal feelings or opinions that might bias the ratings of actual performance;

2. Explicit, i.e., clearly written and free of ambiguities;

3. Observable or measurable, i.e., specifies discernible conditions, characteristics, and the like that allow for differentiating between levels of performance; and

4. Attainable, i.e., barring unexpected circumstances beyond the employee's control, the expectations will most likely be met because they are commensurate with the level of the employee's job responsibility.

A. Positions of the Parties

The Agency's position on Provision 2 is the same as that regarding Provision 1, above. The Agency contends that Provision 2 would "determine the content of performance standards" and directly interfere with management's rights to direct employees and to assign work. Statement of Position at 2. The Agency contends that Provision 2, like Provision 1, would subject its determination of the content of performance standards to arbitral review.

The Union asserts that Provision 2 does not determine the content of performance standards. Rather, according to the Union, the provision "simply mirrors law and regulation." Reply Brief at 5. The Union contends that the provision "also addresses the impact of performance standards as established by the Employer and is thus, negotiable consistent with 5 U.S.C. º 7106(b)(2)." Id. at 6. Finally, the Union contends that the Agency's argument that the provision is nonnegotiable because it would subject performance standards to arbitral review is without merit under the Authority's holding in Newark Air Force Station.

B. Analysis and Conclusions

As noted previously, proposals restricting an agency's right to determine the content of performance standards and critical elements directly interfere with management's rights to direct employees and to assign work under section 7106(a)(2)(A) and (B) of the Statute. See, for example, American Federation of Government Employees, AFL-CIO, Department of Education Council of AFGE Locals and Department of Education, 34 FLRA 1114, 1115-18 (1990) (Proposal 1) (Department of Education). Proposals concerning the application of performance standards, however, do not conflict with management's rights to direct employees and assign work. See, for example, SSA, Vallejo District Office, 35 FLRA at 1281.

In our view, the plain wording of Provision 2 conflicts with the Union's assertion that the provision concerns the application of the performance standards management has established. The provision clearly requires that the performance standards established by management include specified characteristics. That is, performance standards must be objective, explicit, observable or measurable, and attainable.

In Department of Education, the Authority held that a proposal requiring that a performance evaluation system be fair and equitable was nonnegotiable because the fair and equitable requirements addressed the content of performance standards rather than the application of the performance appraisal system. Among the cases the Authority relied upon in finding the proposal to be nonnegotiable was a decision of the U.S. Court of Appeals for the Eighth Circuit which stated, in relevant part:

To allow the Union to negotiate over the meaning of such a broad and subjective term as "fair," for example, would effectively open the door to bargaining over any aspect of performance standards. Contradicting their expressed wish to affect only the application of performance standards, the Union is attempting to gain a foothold in territory that is management's exclusively, i.e., fashioning the content of performance standards.

American Federation of Government Employees, Locals 3748 and 3365 v. FLRA, 797 F.2d 612, 618 (8th Cir. 1986). As the characteristics described in Provision 2 apply to the performance standards themselves, the provision directly interferes with management's right to direct employees and assign work based on the reasoning in Department of Education.

We reject, in this regard, the Union's argument that Provision 2 merely reflects the requirements stated in 5 U.S.C. º 4302(b)(1). A proposal requiring only that performance standards be established in accordance with applicable law, including 5 U.S.C. º 4302(b), is negotiable. Department of Education at 1117. Provision 2, however, does not merely require that the Agency establish performance standards which "will, to the maximum extent feasible, permit the accurate evaluation of job performance on the basis of objective criteria . . . related to the job in question for each employee or position under the system[.]" 5 U.S.C. º 4302(b)(1). Instead, the provision requires that the Agency's performance standards satisfy specific additional criteria, including explicitness, observability or measurability, and attainability. Because Provision 2 imposes additional and different requirements on performance standards established by the Agency than are prescribed by 5 U.S.C. º 4302(b)(1), it does not merely reflect legal requirements. See, for example, National Association of Government Employees, Local R1-144, Federal Union of Scientists and Engineers and U.S. Department of the Navy, Naval Underwater Systems Center, Newport, Rhode Island, 38 FLRA 456, 464-66 (1990) (Proposal 3, requiring that "[p]erformance . . . standards shall be fair and equitable," held to directly interfere with the agency's rights to direct employees and assign work) and Department of Education, 34 FLRA at 1117-18 (Proposal 1, requiring that "performance appraisal system" be "fair, equitable and job-related," found to directly interfere with the rights to direct employees and assign work).

Finally, although not addressed by the parties, we note that the use of the phrase "to the maximum extent feasible" does not render the provision negotiable. The addition of this qualifying language does not eliminate the substantive limitations imposed on management's rights by the provision. Id. at 1118 (use of phrase "insofar as practicable" found not to render proposal negotiable). See also National Treasury Employees Union and Department of Health and Human Services, Region X, 25 FLRA 1041, 1049 (1987) (part of proposal requiring agency to attempt to waive nonmandatory qualifications requirements "to the maximum extent feasible" held to interfere with right to assign employees).

Accordingly, in the absence of any assertion by the Union that the provision constitutes an appropriate arrangement under section 7106(b)(3) of the Statute, we conclude that, as Provision 2 directly interferes with the Agency's rights under section 7106(a)(2)(A) and (B) of the Statute to direct employees and to assign work, it is nonnegotiable.

IV. Provision 3

Article 37; Section 5(H):

H. No employees will be evaluated on the basis of work production or timeliness unless the evaluation explicitly takes into account all job functions the employee is expected to perform including the actual amount of time available to perform such functions. The following are examples of authorized time spent performing other duties and responsibilities which shall not adversely affect an employee's production or timeliness requirements:

1. Time spent performing Union representational functions as required by statute and/or as authorized by the terms and conditions of this agreement.

2. Time spent performing collateral duties such as EEO Counselors, etc.

3. Time spent providing legal advice and assistance to other staff, participating in office meetings, preparing monthly production reports, and responding to requests from Supervisory Staff Attorneys, HOCALJ, and/or Chief Judges.

(Emphasis in proposal.)

A. Positions of the Parties

1. The Agency

The Agency points out that adoption of the wording of Provision 3 was ordered by the Federal Service Impasses Panel (the Panel) in Department of Health and Human Services, Social Security Administration, Headquarters, Office of Hearings and Appeals, Arlington, Virginia and National Treasury Employees Union, Case Nos. 88 FSIP 169 and 182 (1989). In its order, the Panel relied on the Authority's holding as to section 4.G. of the proposals concerning the development and implementation of timeliness standards in Patent Office Professional Association and Patent and Trademark Office, Department of Commerce, 25 FLRA 384, 401-02 (1987) (Patent and Trademark Office), aff'd as to other matters mem. sub nom. Patent Office Professional Association v. FLRA, No. 87-1135 (D.C. Cir. Mar. 30, 1988) (per curiam).

The Agency contends that, instead of Patent and Trademark Office, the Authority's decision in National Treasury Employees Union, Chapter 237 and U.S. Department of Agriculture, Food and Nutrition Service, Midwest Region, 32 FLRA 62, 63-65 (1988) (Provision 1) (Food and Nutrition Service) is dispositive in this case. According to the Agency, Provision 3, like the provision held to be nonnegotiable in Food and Nutrition Service, "would prohibit the Agency from holding an employee responsible for performance which has been affected by the employee's performance of 'other duties and responsibilities,' some examples of which are described in the provision, but which presumably would include other unspecified or unforeseen circumstances." Statement of Position at 6. The Agency asserts that the provision "would prevent management from establishing standards which hold employees responsible to any degree when levels of performance are affected by 'other duties and responsibilities.'" Id.

2. The Union

The Union contends that the provision's wording is "substantively identical" to the wording of section 4.G. in Patent and Trademark Office. Reply Brief at 6. The Union asserts that the provision "would ensure that performance standards are applied fairly and equitably to individual employees." Id. at 7.

The Union states that employees throughout the bargaining unit are evaluated on the basis of objective production and timeliness standards in the execution of their primary job function. However, according to the Union, because of the Agency's decentralized operations, the amount of time employees spend on duties other than their primary function "varies from office to office and supervisor to supervisor, which reduces correspondingly the time available to an employee for the accomplishment of the primary job function." Id. Therefore, the Union asserts, Provision 3 "would allow the Employer, when appraising employees' performance, to consider the time spent performing such assigned duties to the extent it deemed appropriate." Id.

The Union states that the wording of Provision 3 is distinguishable from the provision held to be nonnegotiable in Food and Nutrition Service. The Union contends that Provision 3 "does not prevent the Employer from holding an employee responsible for meeting established performance levels, but simply requires that the Employer take into consideration such factors that are beyond an employee's control in evaluating an employee's performance." Id. (emphasis in original).

B. Analysis and Conclusions

As we noted with respect to Provisions 1 and 2, above, management's rights to direct employees and to assign work include the authority to establish performance standards. Consequently, proposals containing criteria governing the content of performance standards directly interfere with management's rights to direct employees and assign work. Furthermore, proposals absolving employees of accountability for meeting certain levels of performance directly interfere with management's rights to direct employees and assign work because they prevent management from determining the content of performance standards used to evaluate employees' work. See NAFEC, Western Division, 36 FLRA at 845. Similarly, proposals requiring management to adjust or change performance expectations in circumstances identified by the proposals dictate the content of performance standards and, thereby, directly interfere with management's rights to direct employees and assign work. Id.

On the other hand, proposals concerned only with the application to employees of performance standards do not conflict with management's rights to direct employees and to assign work. Id. at 846. Therefore, to decide whether Provision 3 is negotiable, we must first determine if it concerns the content of performance standards or only addresses the application of standards established by management to employees' performance.

The Union asserts that Provision 3 addresses the application of management's performance standards. If the provision were limited to its first sentence only, we would agree. In Patent and Trademark Office, the Authority found that wording similar to that of the first sentence of Provision 3 pertained to the application of performance standards. 25 FLRA at 401-02.

The remainder of Provision 3 sets out examples "of authorized time spent performing other duties and responsibilities which shall not adversely affect an employee's production or timeliness requirements[.]" The balance of Provision 3, therefore, does not merely require management to consider the time spent on the specified situations in evaluating employees' performance, but rather obligates management to disregard those situations when they adversely affect performance ratings. Stated differently, the listed examples are intended to require management to modify the levels of productivity and timeliness established for employees in light of those examples. Accordingly, we find that the remainder of Provision 3, by requiring modifications to timeliness and productivity levels, addresses the content of performance standards. See National Treasury Employees Union and Department of Health and Human Services, Social Security Administration, Office of Hearings and Appeals, 34 FLRA 1000, 1005-06 (1990) (SSA, Office of Hearings and Appeals).

The balance of Provision 3 would prevent the Agency from holding employees responsible for performance affected by the performance of other duties. Consequently, the provision would require that employees be absolved of accountability and responsibility for their work performance where the performance has been affected by other duties. Therefore, Provision 3 directly interferes with management's right to direct employees and to assign work. See, for example, NAFEC, Western Division, (Provision 2); SSA, Office of Hearings and Appeals, 34 FLRA 1000; and Food and Nutrition Service, 32 FLRA at 64-65.

As the Union has not alleged that the provision constitutes an appropriate arrangement within the meaning of section 7106(b)(3) of the Statute, Provision 3 is nonnegotiable because it directly interferes with the Agency's rights to direct employees and assign work.

V. Provisions 4 through 8

The text of Provisions 4 through 8 is set forth in the appendix to this Decision and Order.

A. Positions of the Parties

The Agency contends, based on several court decisions, that to the extent that Provisions 4 through 8 "would permit arbitral review of performance-based and adverse actions taken against nonpreference eligible, excepted service employees, the provisions are contrary to law." Statement of Position at 7.

The Union points out that the Federal Service Impasses Panel ordered that Provisions 4 through 8 include wording making it clear that the provisions "apply to nonpreference eligible, excepted service employees to the extent not prohibited by law and regulation." Reply Brief at 8.(1) The Union contends that "[s]uch a disclaimer would allow the parties to adjust to the current status of the law without having to come back to the negotiations table to renegotiate these issues each time the law changes . . . ." Id. In the Union's view, "the language is specifically designed to avoid any conflict with law." Id. (emphasis in original). The Union further contends that the provisions are consistent with current Authority precedent. Finally, the Union asserts that the Agency's "broad disapproval of an entire grievance and arbitration procedure is in violation of the [S]tatute." Id. at 9.

B. Analysis and Conclusions

Initially we note that the Panel directed inclusion in Provisions 4 through 8 of wording indicating that the provisions "apply to nonpreference eligible, excepted service employees to the extent not prohibited by law and regulation," and that the record reflects the parties' understanding that the wording applies to all five provisions. Read in that context, we find no merit to the Agency's argument that the provisions violate applicable law. The Panel-directed wording clearly indicates that the rights and protections afforded by Provisions 4 through 8 are to be extended to nonpreference eligible excepted service employees only to the extent authorized by applicable law and regulation. That is, based on the provisions' plain wording, the parties to the negotiations did not agree to extend to nonpreference eligible excepted service employees any rights or protections not authorized by law and regulation. Accordingly, Provisions 4 through 8, as written, are not inconsistent with applicable law and regulation.

Moreover, with exceptions not relevant here, the inclusion of nonpreference eligible excepted service employees within the coverage of negotiated grievance procedures is not inconsistent with law. We note, in this regard, that the question of whether nonpreference eligible excepted service employees may be given the procedural protection of negotiated grievance procedures has been examined by several courts. These courts noted that Congress, in the Civil Service Reform Act (CSRA), denied nonpreference eligible excepted service employees the administrative notice and appeal procedures available to preference eligibles and competitive service employees in adverse actions. Consequently, the courts found that affording nonpreference eligible excepted service employees access to negotiated grievance procedures to contest adverse actions was inconsistent with applicable law. See, for example, U.S. Department of Health and Human Services v. FLRA, 858 F.2d 1278, 1284 (7th Cir. 1988) and Department of the Treasury, Office of the Chief Counsel v. FLRA, 873 F.2d 1467, 1472 (D.C. Cir. 1989).

Subsequent to the cited court decisions, the Civil Service Due Process Amendments, Pub. L. No. 101-376, 104 Stat. 461 (1990) (the Amendments) were enacted. The Amendments "extend to certain employees in the excepted service who are not preference eligibles the same administrative notice and appeal procedures currently provided employees in the competitive service and preference eligible employees in the excepted service." H.R. Rep. No. 328, 101st Cong., 2d Sess. 1 (1990). In passing these amendments, Congress determined that "certain employees in the excepted service who are not preference eligibles," including those covered by Provisions 4 through 8, should be treated similarly to preference eligible excepted service employees and their coworkers in the competitive service concerning adverse action appeal rights.

As the Amendments extend to nonpreference eligible excepted service employees, with some exceptions not relevant here, the same appeal rights provided to other civil service personnel, the basis for the courts' decisions no longer exists. Moreover, we are aware of no other basis, and the Agency has not presented any, for excluding such employees from coverage under negotiated grievance procedures. In addition, we note no conflict between these provisions and the Amendments' requirement that, to have access to appeal rights, nonpreference eligible excepted service employees must have "completed 2 years of current continuous service in the same or similar positions in an Executive agency under other than a temporary appointment limited to 2 years or less" before they are eligible to appeal adverse actions. See 5 U.S.C. º 7511(a)(1)(C), as amended. Accordingly, we conclude that Provisions 4 through 8 are negotiable. Compare Federal Employees Metal Trades Council and U.S. Department of the Navy, Mare Island Naval Shipyard, Vallejo, California, 38 FLRA No. 110 (1990), slip op. at 19-20 (proposal enabling temporary employees to grieve terminations held to be inconsistent with law).

VI. Order

The Agency must rescind its disapproval of Provisions 1 and 4 through 8.(2) The petition for review of Provisions 2 and 3 is dismissed.

APPENDIX

Provision 4

ARTICLE 39

Actions for Unacceptable Performance

Section 1

The Employer, in taking any action based on demonstrated unacceptable performance by an employee, will do so in the most fair and objective way possible, with particular attention given to avoiding disparate treatment of employees. The Employer will make every reasonable effort to assist employees in improving deficient performance and will provide reasonable opportunity for the employee to correct performance problems before initiating any adverse action proceedings.

Section 2

When the Employer determines that an employee's performance is unacceptable, the Employer will give the employee a warning notice in writing which will:

A. Identify specifically where the employee's performance is unacceptable;

B. Provide the written performance standard(s) established for the position;

C. Provide specific examples of how the employee's performance is failing to meet the standard;

D. Specify ways in which the employee must bring performance up to standard;

E. If not already accomplished, provide for training, counseling, or other reasonable efforts to assist the employee to bring performance up to an acceptable standard; and

F. Allow a reasonable time, but not less than ninety (90) calendar days, for the employee to bring performance up to standard before any further action is taken.

Section 3

An employee, whose reduction in grade or removal for unacceptable performance is proposed, is entitled to:

A. Thirty (30) days advance written notice of proposed action which specifies:

1. Specific instances of unacceptable performance by the employee on which the proposed action is based.

2. The critical elements of the employee's position involved in each instance of unacceptable performance;

B. Be represented by an attorney or other representative in making a reply;

C. Reasonable time to answer orally and in writing. Normally this will not be less than fifteen (15) days. Reasonable requests for extensions of time by employees or designated representative will be granted; and

D. A written decision which specifies the instances of unacceptable performance, and which has been concurred in by the Employer who is in a higher position than the management official who proposed the action.

Section 4

The decision to retain, reduce in grade, or remove the employee shall be made within thirty (30) days after the expiration of the notice period, and may be based only on those instances of unacceptable performance by the employee which occurred during the one-year cycle period ending in the date of the notice issued under Section 3A of this Article. The Employer may extend the notice period for thirty (30) days.

That decision will state which specific instances of employee performance were relied upon by the Employer in the decision. The letter also will state whether the employee has a right to appeal the final decision to the Merit Systems Protection Board or only to the negotiated Grievance Procedure of this Agreement.

Section 5

If, because of performance improvement by the employee during the notice period, the employee is not reduced in grade or removed, and the employee's performance continues to be acceptable for one year from the date of the advance written notice, any entry or other notation of unacceptable performance for which the action was proposed shall be removed from any [A]gency record relating to the employee.

Section 6

This Article does not apply to an employee who is serving the first 6 months of trial period under an initial appointment or who has not completed 6 months of current continuous employment in the same or similar positions.

Section 7

This Article applies to nonpreference eligible, excepted-service employees to the extent not prohibited by law and regulation.

Provision 5

ARTICLE 43

Disciplinary Actions

Section 1

A. No employee shall be disciplined except for just cause.

B. Discipline includes, but is not limited to the following: a written reprimand, a suspension without pay for fourteen (14) calendar days or less, and appropriate disciplinary adverse actions as defined in Article 44, Section 1.

C. The parties agree that involuntary transfers, and/or involuntary resignations are not appropriate disciplinary measures.

Section 2

It is the responsibility of the Employer to provide and of each employee to:

A. Know and be aware of the standards of conduct of the Department of Health and Human Services and the Social Security Administration and,

B. To adhere to the standards contained therein.

Section 3

The parties recognize that discipline shall be progressive in nature to correct the conduct of an offending employee, and the Employer agrees to follow a course of progressive discipline. Discipline will be preceded by counseling and assistance which will be informal in nature. If recorded, a copy of the discipline shall be provided to the employee for his/her response. It is understood that progressive discipline need not follow any specific sequence and that major offenses will be cause for severe adverse actions including removal, irrespective of whether previous discipline has been taken against the offending employee.

Section 4

A. The Union shall be given the opportunity to be represented at the following:

1. Any examination of an employee in the unit by a representative of the [A]gency in connection with an investigation, if the employee reasonably believes that the examination may result in disciplinary action against the employee and the employee requests representation. This includes any meeting in connection with an investigation as described above.

Furthermore, the [A]gency will inform any involved employee at the beginning of any meeting as to the nature of the meeting. Once the employee requests Union representation, he/she will be given a reasonable amount of time to secure such representation before the investigation proceeds.

B. As part of his/her representational responsibilities during an examination of an employee that the employee reasonably believes could lead to discipline, the Union official may do the following:

1. Assist the employee

2. Attempt to clarify the facts

3. Suggest other employees who have knowledge of the facts

4. Record, only in handwritten notes, each question and the response;

5. Record the examiner's name and any identification number.

Section 5

A. An employee will, in a disciplinary and adverse action and upon request, be furnished a copy of that portion of all written documents which contain evidence relied upon by the Employer in reaching its decision to propose or impose discipline.

B. If the discipline is based on investigative reports portions of all written documents from the investigation which relate to the specifications and are favorable to the employee will be furnished to the employee upon request.

C. If probable cause exists, and is demonstrated to the arbitrator by the Union on appeal, that favorable information provided for in subsection B above has not been furnished by the Employer, upon request of the arbitrator, the report will be furnished to him/her for an "In Camera" inspection to be made in conformity with the Privacy Act (5 U.S.C 552a). Material determined by the arbitrator to be favorable under the criteria of "B" not previously furnished to the Union will be furnished to the Union at that point.

Section 6

When the Employer chooses to take any suspension for 14 days or less or adverse action against an employee the following procedures will apply:

A. The Employer will provide the affected employee with 15 workdays advance written notification of the proposed action, except for adverse actions for which 30 days shall be provided.

B. The written proposal will contain all reasons relied upon for the proposed stated discipline specifically.

C. The material on which the notice of proposed discipline is based including statements of witnesses, documents, and investigation reports or extracts, shall upon request, be assembled, copied, and given to the employee at the time the proposal is delivered.

D. The employee will be given seven workdays from the date he/she received the notice of proposed discipline in which to request oral/or written reply to the notice of proposed discipline, except for adverse actions, for which 14 days will normally be provided. Where an oral reply has been requested, it will be scheduled at the convenience of the parties within 15 days from the date the employee received the notice, unless otherwise mutually agreed by the parties.

E. The employee and his/her representative will be given a reasonable amount of official time to prepare the replies described above.

F. Where an employee chooses to make an oral reply, the reply will be heard by a higher level management official than the official who issued the notice of proposed disciplinary action. The oral reply, if made, will be summarized with copies of the summary delivered to the employee and his/her representative for comment before a final decision is made.

G. The final decision in any proposed discipline covered by this Section must be made by a higher level management official than the official who issued the notice of proposed action. The final decision letter will contain the Employer's detailed findings with respect to each reason and specification made against the employee in the notice of proposed action.

H. Where an employee chooses to make an oral reply as provided above, such reply shall be made at the work site of the employee.

I. If the Employer's final decision is to effect a disciplinary or adverse action against a bargaining unit employee, that employee may file a grievance or appeal, pursuant to the provisions of Article 44, Section 3, (Adverse Actions) if appropriate. If the employee files a grievance, he/she has fifteen (15) workdays in which to file a grievance with the Step 3 official as provided under Section 4 of Article 45. Thereafter all requirements associated with subsequent steps of the appropriate grievance procedure will apply.

Section 7

Letters of Reprimand will be removed from the employee's records no later than 12 months from the date of issuance.

Section 8

This article applies to nonpreference eligible, excepted-service employees to the extent not prohibited by law and [regulation].

Provision 6

ARTICLE 44

Adverse Actions

Section 1

The actions covered by the provisions of this Article are removals, suspensions for more than fourteen (14) calendar days, reductions in grade or pay for disciplinary reasons and furloughs of thirty (30) days or less.

Section 2

Where an action is proposed under this Article the employee against whom the action is proposed is entitled to:

A. At least thirty (30) days advance written notice, unless there is reasonable cause to believe the employee has committed a crime for which a sentence of imprisonment may be imposed, stating the specific reasons for the proposed action;

B. The thirty (30) days advance written notice is not required to effect an emergency suspension pursuant to government-wide rules, regulations, and law. When the circumstances warrant immediate action, the proposing official may place the employee in a nonduty status with pay for such time not to exceed ten (10) days, as is necessary to propose and effect the suspension. The proposed notice of emergency indefinite suspension shall be given a reasonable time, but not less than seven (7) calendar days, to respond orally and/or in writing and to furnish affidavits and other documentary evidence in support of the answer.

C. A reasonable time (normally fourteen (14) but not less than seven (7) workdays) from receipt of the proposed action, to review the materials relied upon by the Employer and to answer the charges, specifications or reasons orally and/or other documentary evidence in support of the answer.

Section 3

A.An employee aggrieved by an adverse decision under this Article may appeal the action to the Merit Systems Protection Board or under the grievance and arbitration procedure provided in this Agreement but not under both.

B.An employee shall be deemed to have exercised his option under this Section at such time as the employee timely initiates an appeal to the Merit Systems Protection Board or timely files a written grievance under the provisions of this Agreement which event occurs first.

C.An employee who elects to appeal an action to the Merit Systems Protection Board may be represented by the Union or an attorney or other representative of his own choosing. An employee who elects to appeal an action under the grievance procedures provided in this Agreement may be represented by the Union, himself/herself/or an individual approved by the Union.

D.Grievances contesting the validity of adverse actions under this Article shall be filed directly at the third step.

Section 4

A.The provisions of the Article apply to employees specifically covered by this Agreement who are in the excepted service who are not serving the first 6 months of a probationary or trial period under an initial appointment or who have completed one (1) year of current continuous employment under other than a temporary appointment limited to one year or less; except that a non-preference eligible in the excepted service may not exercise an option to appeal to the Merit Systems Protection Board under this Article.

B.The provisions of this Article do not apply to:

1.A suspension or removal in the interests of national security initiated under Section 7532 of Title 5, United States Code;

2.A reduction-in-force action under Article 21 of this Agreement; or

3.A reduction in grade or removal based upon unacceptable performance initiated under Article 39 of this Agreement.

Section 5

This Article applies to non-preference eligible, excepted service employees to the extent not prohibited by law and regulation.

Provision 7

ARTICLE 45

Grievance Procedure

Section 1

The parties agree that grievances and complaints should be settled in an orderly, prompt, and equitable manner which will maintain the self respect of all parties involved and be consistent with the principles of good management. Every effort will be made by supervisors and officials of the Union to settle grievances at the lowest level of supervision.

An employee or any representative will be unimpeded and free from restraint, interference, coercion, discrimination, or reprisal in seeking appropriate adjustment of a grievance. The initiation or representation of a grievance in good faith by an employee will not cause any reflection on his or her standing with management nor on his or her loyalty to the Office.

Section 2

A grievance means any complaint:

A. By an employee concerning any matter relating to the employment of the employee;

B. By the Union concerning any matter relating to the employment of any employee; or

C. By any employee, the Union or the Employer concerning:

1.the effect or interpretation, or a claim of breach, of this Agreement, or

2.Any claimed violation, misinterpretation, or misapplication of any law, rule, or regulation affecting conditions of employment.

D. The term grievance does not include:

1. Any claimed violation of law relating to prohibited political activities;

2. Retirement, life insurance, or health insurance;

3. A suspension or removal under Section 7532 or Title 5 U.S.C.;

4. Any examination, certification, or appointment;

5. The classification of any position which does not result in the reduction in grade or pay of an employee; or

6. The removal of any employee serving a probationary or trial period under an initial appointment who has not completed twelve months of current continuous employment under other than a temporary appointment limited to one (1) year or less.

7. Nonadoption of a suggestion.

Section 3

An aggrieved preference eligible employee affected by alleged discrimination action based on unacceptable performance or adverse action may at his/her option raise the matter under statutory appellate procedure or the negotiated grievance procedure, but not both. For the purpose of this Section and pursuant to Section 7121 of the Civil Service Reform Act, an employee shall be deemed to have exercised his/or option at such time as the employee timely initiates an action under the applicable statutory procedure or timely files a grievance in writing in accordance with the provision of this procedure, whichever occurs first.

Section 4.

A grievance under this negotiated system can be initiated by an employee, a group of employees, the Union, or Management. An employee or group of employees may not invoke arbitration proceedings on their grievance on their own initiative. Only the Union or Management may request arbitration.

Employees dissatisfied with orders properly grounded in supervisory authority are expected to follow the order first and then consider filing a grievance. Any grievance on which action is not initiated with the immediate supervisor within 15 work days after the occurrence of the incident or event from which such grievance arose will not be presented or considered at a later date unless the employee was not aware of being aggrieved within the stated time limit. When the basis for a grievance is a continuing practice or condition, a grievance may be filed at any time.

The following shall normally serve as the Step 1, 2, and 3 management officials for all employee grievances filed under the negotiated grievance procedure. In hearing offices where there are Supervisory Staff Attorneys, the Step 1 official is the Supervisory Staff Attorney, the RCALJ is the Step 2 official, and CALJ is the Step 3 official (except in the case of performance appraisal grievances in which case the Step 2 official is the HOCALJ and the Step 3 official is the RCALJ). In hearing offices where there are no Supervisory Staff Attorneys, the HOCALJ is the Step 1 official, and the RCALJ is the Step 2 official, and the CALJ is the Step 3 official.

Step 1

A grievance must be presented in writing to the Step 1 management official within 15 work days after the occurrence of the incident or event from which such grievance arose or the employee first became aware of the matter, whichever is later. The employee's written presentation must sufficiently identify and clearly explain all matters and issues which form the basis of the grievance in order for the grievance to be understood and considered. Consideration of the grievance at all levels shall be limited to those matters and issues contained in the Step 1 presentation. Matters and issues not contained in the Step 1 presentation will not and cannot receive consideration by an official or arbitrator. Within 10 workdays from receipt of the grievance, the Step 1 management official, if requested, will grant a fac[e]-to-face meeting with the grievant, provided no travel or per diem is incurred by the Employer. Within 20 work days from receipt of the grievance, the Step 1 official will issue a decision in writing, either granting, modifying, or denying the relief requested. The decision will notify the employee of the name, title, location and telephone number of the Step 2 official with whom to proceed if necessary.

Step 2

The employee may appeal to the Step 2 official in writing within 10 work days after the Step 1 decision was or should have been issued. A copy of the Step 1 presentation and decision must be attached by the employee. The employee must set forth specific reasons for dissatisfaction with the Step 1 decision, but if no Step 1 decision was issued within the time period required, then that fact should be noted with on other explanation except for being accompanied by a copy of the initial grievance presentation. Within 10 work days from receipt of the grievance the Step 3 official will issue a final decision in writing to the employee either granting, modifying or denying the relief requested.

Step 3

The employee may appeal to the Step 3 official or his/her designee in writing within 10 work days after the Step 2 decision was or should have been issued. A copy of the Step 1 and 2 presentations and decisions must be attached by the employee. The employee must set forth the specific reasons for dissatisfaction with the Step 2 decision, but if no Step 2 decision was issued within the time period required, then that fact should be noted with no other explanation except for being accompanied by copies of all the previous available grievance presentations and decision. Within 10 workdays from receipt of the grievance the Step 3 official will issue a final decision in writing to the employee either granting, modifying or denying the relief requested.

Step 4

If the Step 3 decision is not acceptable to the employee or the Union, or if no timely decision is issued, the Union may proceed to arbitration if it so elects and then in accordance with the provisions of Article 46, Arbitration. Notification of the Employer's decision in Step 3 must also be sent to the NTEU Field Representative.

Section 5

A. Where the Employer elects to file a grievance pursuant to this Article, such grievance shall be in writing addressed to the President of NTEU and the appropriate NTEU Field Representative. The NTEU President or designee shall within 20 workdays after receipt of such grievance issue a written decision addressed to the Associate Commissioner and/or designee who signed the grievance.

B. Where the Union files a grievance pursuant to this Article, such grievances shall be in writing addressed to the Associate Commissioner and/or designee. The Employer shall, within 20 workdays after receipt of such grievances, issue a written decision addressed to the President of the Union and designee.

If the Union is not satisfied with the decision of the Associate Commissioner or designee the Union may proceed to arbitration in accordance with the provisions of Article 46, Arbitration.

C. The Employer and/or Union grievances must be filed within 20 working days of the date the Party become aware of the matter, unless the matter is a continuing practice or condition which may be filed at any time.

Section 6

A. At the discretion of the Step 2 and/or 3 official at whose level the grievance is pending, the employee and/or his/her representative may meet with the Employer official, provided that no travel or per diem costs are borne by the Employer. The holding of the face-to-face meeting will not serve to affect any of the time limits required by this grievance procedure, and in no case can a meeting or lack thereof cause or be used by, an official to delay the issuance of a decision at any step.

B. Failure of the Employer to observe the time limits stated in this grievance procedure shall, at the election of the grievant, advance the grievance to the next step. However, where the employee representative, and/or the Union is responsible for such failure, the grievance may be dismissed by the Employer official at whose level the grievance is pending.

C. Grievance decisions will be served directly upon the employee and in the second stage, on the steward either by certified return receipt mail or in person. It is the responsibility of the employee to provide copies of the decisions to their representatives.

D. In computing any period of time prescribed by or allowed by this procedure, the day of the act, event or occurrence from or after which the designated period of time begins to run shall not be included. A document postmarked by the last day of any time period prescribed under this Article, or as mutually extended, will be accepted as timely filed.

E. It is understood that an employee processing a grievance under this Article shall be limited to Union representation, self representation, or a representative approved by the Union. If an employee presents a grievance without Union representation, the Union will be given the opportunity to be present at all formal discussions of the grievance. The Union shall be given reasonable advance notice of such meetings. The Parties agree that an adjustment must not be inconsistent with the terms and considerations of this Agreement.

Section 7

Upon mutual agreement between the parties, grievances may be combined and processed as one.

Section 8

A. When the Employer alleges an issue is non-grievable and/or is not arbitrable then the Employer shall notify the employee in writing, stating all the reasons for such determination.

B. When the Employer alleges an issue is non-grievable or non-arbitrable, the Union if it wishes will have five (5) workdays to amend and refile the grievance so that it will be procedurally correct. It will be resubmitted at the level at which the issue was raised and proceed as a normal grievance.

C. If a question of grievability is raised, the grievance shall proceed through the grievance procedure with the question of grievability joined to the grievance.

D. Questions that cannot be resolved by the parties as to whether a grievance is on a matter subject to the negotiated grievance procedure or arbitration shall be resolved by first submitting the issue to the arbitrator assigned the full case.

E. If the issue of timeliness is raised, a grievance may be denied on the grounds it was not presented within the time frame specified. Denial of a grievance on that ground, however, will not deprive the grievant of the right to present the merits of the grievance, or deprive Management of the right to rely on untimeliness as a ground for denial, at each successive step of the grievance procedure, including arbitration.

Section 9

Where a grievance is filed and the Union or employee alleges violation of rules or regulations, the Employer agrees that it will not dispose of the grievance solely because of an incorrect citation.

Section 10

A grievance based upon the Employer's denial of a request to engage in outside employment activity will be filed directly with the Chief Administrative Law Judge. The grievance must be filed within 10 workdays of the employee's receipt of the Employer's written denial of the request, or within a reasonable time after the request has been submitted where no written determination has been issued. Thereafter all requirements associated with grievance and arbitration will be followed.

Provision 8

ARTICLE 47

Expedited Arbitration

Section 1

This expedited arbitration procedure is intended to provide prompt and efficient resolution of certain matters. Accordingly, the parties agree to submit grievances concerning the following matters to arbitration in accordance with the terms of this Agreement:

A. Suspension of the (10) days or less;

B. Written reprimands;

C. Denials of annual, sick, or leave without pay;

D. Performance appraisals, or career promotion denials;

E. Any other matter which the parties, by mutual agreement, may determine;

F. In no case will a matter be submitted under this procedure which include [sic] allegations of EEO violations.

Section 2

The request for arbitration under this Article must be made within five (5) workdays after receipt of the final decision by the Field Representative, or, if no final decision is issued, within five (5) workdays from the date each decision should have been issued. If not appealed within this time limit, the Union will have the option of appealing through the regular arbitration procedure.

Section 3

A. Within 60 days after the effective date of this Agreement, the parties will create a list of arbitrators in each region to be maintained exclusively for grievances processed under this Article. Any arbitrator selected for inclusion may be removed from this list only by mutual agreement of the parties. Such removal will be effected by giving joint, written notice of this action to the arbitrator.

B. After the first twelve (12) months, and after every succeeding twelve (12) month period this Agreement remains in effect, the Employer and the Union may each remove unilaterally from the list a number of arbitrators not to exceed one-third (1/3) the total. Replacements will be chosen in equal number to those removed, and in the same manner as originally selected.

C. Arbitrators will be selected to hear a grievance under the procedure on a rotational basis. Arbitrators will be selected within five (5) workdays after notice of appeal to arbitration is served upon the other party. Notice of selection will be forwarded to the arbitrator within two (2) workdays after selection.

D. The arbitrator will conduct the hearing within fifteen (15) calendar days after being notified of his/her selection. If the arbitrator is unable to hear this case within this time frame, the next arbitrator on the list will be selected.

Section 4

The following procedures will apply to the arbitration of any dispute under this procedure:

A. The arbitration hearing shall be held during the regular work hours of the basic work week at a convenient site arranged by the Employer.

B. The parties have the right to issue opening and closing statements, and to present and cross examine witnesses.

C. Attendance at the hearing will be limited to those determined by the arbitrator to have direct knowledge of the circumstances and factors bearing on the case. The arbitrator may exclude any testimony or evidence which he/she determines irrelevant or unduly repetitious.

D. Witnesses will normally be presented at the hearing only while testifying and should be permitted to testify only in the presence of the aggrieved employee or his/her representative and the Employer's representatives.

E. he grievant's representative and all employees of the Employer who are called as witnesses, and who are on active duty status, shall be excused from duty to the extent necessary to participate in the arbitration proceedings without loss of pay. If an employee must be excused from duty, the amount of time to testify will be charged to official time. The arbitrator shall have sole discretion to determine who may testify.

F. The hearing shall be informal, and strict rules of evidence will not apply. However, all testimony shall be made under oath or affirmation.

G. Bargaining history testimony may be introduced, as appropriate.

H. There will be no transcript.

Section 5

A. The arbitrator will issue a brief, written decision within fifteen (15) work days of the close of the hearing. This decision will be final and binding on both Parties. However, either Party may file exceptions to an award with the Federal Labor Relations Authority, under regulations prescribed by the Authority.

B. The arbitrator shall have no power to add to, subtract from, or modify the terms of this Agreement, agency policies or regulations. His/her award will be limited to the issues presented at arbitration.

C. The arbitrator shall have the authority to make all arbitrability and/or grievability determinations. The arbitrator shall make such determinations prior to addressing the merits of the original grievance.

Section 6

The arbitrator'