41:0982(78)AR - - DOD Dependents Schools, Alexandria, Virginia and Overseas Education Association - - 1991 FLRAdec AR - - v41 p982



[ v41 p982 ]
41:0982(78)AR
The decision of the Authority follows:


41 FLRA No. 78

FEDERAL LABOR RELATIONS AUTHORITY

WASHINGTON, D.C.

U.S. DEPARTMENT OF DEFENSE

DEPENDENTS SCHOOLS

ALEXANDRIA, VIRGINIA

(Agency)

and

OVERSEAS EDUCATION ASSOCIATION

(Union)

0-AR-1798

DECISION

July 31, 1991

Before Chairman McKee and Members Talkin and Armendariz.

I. Statement of the Case

This matter is before the Authority on exceptions to an award of Arbitrator Earle W. Hockenberry filed by the Agency under section 7122(a) of the Federal Service Labor-Management Relations Statute (the Statute) and part 2425 of the Authority's Rules and Regulations. The Union filed an opposition to the Agency's exceptions.

In a voluntary interest arbitration proceeding under section 7119(b)(2) of the Statute, the Arbitrator considered 41 bargaining proposals for inclusion in a new collective bargaining agreement between the Agency and the Union. The award consists of a number of bench decisions issued by the Arbitrator on the proposed contract provisions. As a preliminary matter, the Agency contends that the appropriate forum in which to challenge the propriety of an interest arbitration award is through the agency head review process provided for in section 7114(c) of the Statute. The Agency maintains that "the right of an agency head to disapprove a contract cannot be taken away." Exceptions at 2. The Agency states that, if the Authority rejects the Agency's position, the Agency challenges the interest arbitration award through these exceptions pursuant to section 7122 of the Statute. The Union contends in its opposition that the Agency can challenge the Arbitrator's award only through exceptions filed pursuant to section 7122 of the Statute.

With respect to the merits of three articles imposed by the Arbitrator concerning (1) the negotiated grievance procedure, (2) procedures for debt collection, and (3) priorities for space available travel, the Agency contends that the award is contrary to law and to an Agency regulation for which a compelling need exists. The Union asserts in its opposition that the Agency's exceptions to the Arbitrator's bench decisions concerning Article 12 (Grievance Procedure) and Article 45 (Debt Collection Act) are untimely and should not be considered. The Union also filed a motion requesting that the Authority dismiss the Agency's exception to the bench decision on Article 45 because the parties have settled the dispute that formed the basis of the Agency's exception to the Arbitrator's decision on that article. The Union also filed a motion requesting dismissal of the Agency's exception to the decision on Article 12 as moot on the ground that the Agency's exception has been resolved by subsequent amendments to relevant law.

With regard to the Agency's contention that the appropriate means by which to dispute the Arbitrator's bench decisions is agency-head disapproval under section 7114(c) of the Statute, we find that any disagreement with the Arbitrator's bench decisions must be raised in timely exceptions filed with the Authority pursuant to section 7122 of the Statute. As to the timeliness of the Agency's exceptions to the bench decisions on Article 12 (Grievance Procedure) and Article 45 (Debt Collection Act Procedures), we find that those exceptions are timely. However, based on the Union's uncontroverted assertion that the dispute regarding Article 45 has been resolved by the parties, we will dismiss the Agency's exceptions regarding that article as moot. We do not agree that the exception to Article 12 should be dismissed as moot. On the merits, we conclude that the Agency has failed to show that the Arbitrator's bench decision concerning Article 48 (Travel) is deficient and we will deny the Agency's exception to the decision on Article 48. Similarly, we find no deficiency with regard to the decision on Article 12 (Grievance Procedure) and we deny the Agency's exception to that decision.

II. Background and Arbitrator's Award

The Union represents nonpreference eligible excepted service (NEES) teachers located at military bases overseas. The parties reached impasse in bargaining on a new worldwide collective bargaining agreement. After seeking assistance from the Federal Mediation and Conciliation Service, the parties requested the Federal Service Impasses Panel (the Panel) to approve a joint request for a binding arbitration procedure to resolve the impasse on 41 disputed proposals. The Panel approved the parties' request. The Panel also referred the parties to Commander, Carswell Air Force Base, Texas and American Federation of Government Employees, Local 1364, 31 FLRA 620 (1988) for guidance on the authority of interest arbitrators to consider duty to bargain issues raised during interest arbitration proceedings. Subsequently, the parties selected the Arbitrator as a mediator/arbitrator to resolve the dispute.

The interest arbitration proceeding convened on August 7, 1989, and concluded on or about midnight on August 18, 1989. See Exceptions at 1; Opposition at 2. The Arbitrator did not issue a written award, but issued a series of oral bench decisions during the hearings. See id. As his bench decisions, the Arbitrator imposed specific provisions on the parties as part of their collective bargaining agreement. The Agency contends that the Arbitrator's bench decisions are deficient with regard to three provisions imposed in the parties' collective bargaining agreement.

III. Preliminary Issues

A. The Agency's Exception Concerning Article 45 Is Dismissed (1)

In its exception to the bench decision concerning Article 45, the Agency contends that the Arbitrator's decision is contrary to the Debt Collection Act (5 U.S.C. § 5514(a)(2)) because the article imposed by the Arbitrator includes procedures for collecting debts owed by employees to other agencies and is not restricted to debts owed by Agency employees to the Agency.(2) The Agency asserts that the Act requires "the agency holding the debt to provide the indebted individual with procedures required by the Debt Collection Act." Exceptions at 8-9. The Agency argues that to the extent that the decision "concerns procedures to be used by the Agency for the collection of debts owed to other agencies, it is contrary to law and must be set aside." Id. at 9.

In its motion to dismiss the Agency's exception concerning Article 45, the Union states that it has agreed with the Agency to include in the collective bargaining agreement the following language intended to eliminate the basis for the Agency's exception:

It is understood that this Article applies only to debts owed by unit employees within the Department of Defense and does not apply to debts owed to other Federal agencies.

Union Motion at 1 and at Attachment (Agreement at 86). The Agency did not respond to the Union's motion to dismiss the exception concerning Article 45. We accept the Union's uncontroverted submission as evidence that the Agency's objection to the article imposed by the Arbitrator has been resolved. Consequently, we will dismiss the Agency's exception.

B. The Exception to the Arbitrator's Decision Concerning Article 12 Is Timely Filed

The Union contends that the Agency's exceptions with respect to Article 12 (Grievance Procedure) and Article 45 "must be dismissed because they are untimely filed." Opposition at 2. The Union asserts that Article 12 was imposed on August 17, 1989, and, therefore, a timely appeal was due on September 15. Id. at 3. See Attachment to Opposition. Further, the Union asserts that the Arbitrator's decision on Article 45 was imposed on August 14, 1989, and any timely appeal was due on September 12. Id. See Attachment to Opposition. The Union argues that because the exceptions with respect to Articles 12 and 45 were filed on September 18, 1989, they are untimely. The Union asserts that only the exceptions to the decision on Article 48, concerning priorities for space available travel, were timely filed.

In view of our decision above to dismiss the exception to Article 45, we will address only the timeliness of the Agency's exception to the bench decision concerning Article 12. The time limit for filing exceptions to an arbitration award is 30 days beginning on the date the award is served on the filing party. 5 U.S.C. § 7122(b); 5 C.F.R. § 2425.1(b).

The practice of allowing the filing of exceptions to oral bench decisions was recently examined by the Authority in U.S. Small Business Administration, Washington, D.C. and American Federation of Government Employees, Council 228, Local 2532, 38 FLRA 386 (1990) (SBA). In SBA we held that, "to be consistent with the statutory and regulatory provisions pertaining to the filing of exceptions, an oral bench decision must be reduced to writing and served on the parties. When exceptions are filed, a legible copy of the written transcription can then be included to facilitate our review." 38 FLRA at 404. Therefore, the period for filing exceptions to bench awards under section 7122(b) of the Statute and section 2425.1 of our Rules commences on the date that a written bench award is served on the parties. The time limit for filing exceptions may not be extended or waived by the Authority. 5 C.F.R. § 2429.23(d).

The record in this case shows that the Arbitrator issued his bench decision on Article 12 on August 17, 1989, in the form of an agreement provision which the Arbitrator handed to the parties and which the parties then initialed and dated. We find that the bench decision delivered in that manner satisfies the requirement for a written transcription. See SBA.

With regard to the issue of timeliness of the Agency's exception concerning Article 12, we note that the bench decision in SBA resulted from grievance arbitration. The bench decisions in the present case are the product of voluntary interest arbitration entered into with the approval of the Panel under section 7119(b)(2) of the Statute. Interest arbitration awards, which determine the content of provisions of collective bargaining agreements, are fundamentally different from grievance arbitration awards, which concern the interpretation of already existing provisions in collective bargaining agreements. A bench award in a grievance arbitration might well concern a number of discrete matters that, when settled, have no effect on the remaining matters in the grievance and thus, are ripe for the filing of exceptions upon the issuance of a bench award. On the other hand, the objective of interest arbitration is to assist the parties in resolving bargaining impasses and in arriving at completed collective bargaining agreements which can then be executed and implemented. Because of the significant difference between interest arbitration awards and grievance arbitration awards, we conclude that the timeliness requirements applicable to the filing of exceptions to bench awards in grievance arbitration proceedings should not be applied to the filing of exceptions to bench awards in interest arbitration proceedings.

Rather, the time limits for filing exceptions to interest arbitration bench awards under section 7119(b)(2) should be applied in the same manner as the time limits for agency head review following the execution of a collective bargaining agreement under section 7114(c)(2) of the Statute. The collective bargaining agreement is considered to be executed when agreement is reached and reduced to a written document signed by the parties and nothing further remains to prevent the execution of an agreement between the parties. See American Federation of Government Employees, National Veterans Affairs Council and U.S. Department of Veterans Affairs, Veterans Health Services and Research Administration, Washington, D.C., 39 FLRA 1055, 1057 (1991), request for reconsideration denied 40 FLRA 195 (1991) (for purpose of determining 30-day time period for agency head review of agreement imposed by the Panel, the date of the Panel decision constituted the date of execution of the agreement); International Organization of Masters, Mates and Pilots and Panama Canal Commission, 36 FLRA 555, 560-63 (1990) (the date on which an interest arbitrator's award was served on the parties constituted the date of execution of the agreement and the agency head had 30 days from that date in which to disapprove the agreement). This approach results in a more orderly procedure that treats agreements as complete units rather than as collections of separate provisions.

Applying that rule to the present case, any exceptions to the Arbitrator's bench decisions imposing agreement provisions on the parties were due within 30 days beginning on the date the last decision was served on the parties and there was no other action necessary for the execution of the agreement. Therefore, any exceptions to the Arbitrator's bench decision on Article 12, as well as the other bench decisions were due on September 18, 1989, and had to be either postmarked by the U.S. Postal Service or received in person at the Authority no later than September 18, 1989, in order to be considered timely. The Agency's exceptions were filed (postmarked) with the Authority on September 18, 1989. Accordingly, we find that the Agency's exception to Article 12 was timely filed and will be considered. See Patent Office Professional Association and U.S. Department of Commerce, Patent and Trademark Office, 41 FLRA No. 72 (1991).

C. The Appropriate Means for Challenging Interest Arbitration Awards Is the Filing of Exceptions with the Authority

1. Positions of the Parties

The Agency contends that agency head review under section 7114(c) of the Statute should be used as the appropriate procedure in which to challenge the Arbitrator's interest arbitration award. The Agency maintains that the right of an agency head to review agreements cannot be taken away. The Agency indicates, however, that it is filing exceptions in this case in the event the Authority holds that exceptions are the appropriate method by which to challenge the Arbitrator's bench awards.

The Union contends that the interest arbitration in this case was entered into voluntarily by the parties with the approval of the Panel under section 7119(b)(2) of the Statute and was not directed by the Panel. The Union argues that because the arbitration was voluntary, there is no right of agency head review and the award can be challenged only by filing exceptions under section 7122 of the Statute.

2. Analysis and Conclusions

In U.S. Department of the Interior, Bureau of Reclamation, Lower Colorado Region, Yuma, Arizona and National Federation of Federal Employees, Local 1487, 41 FLRA 3 (1991) (Bureau of Reclamation), we addressed whether exceptions may be filed to interest arbitration awards issued following Panel approval of a joint request under section 7119(b)(2) of the Statute. We held that although the use of interest arbitration to resolve negotiation impasses is authorized under either section 7119(b)(1) or (2), those provisions are "decidedly in the disjunctive" and lead to different results. Id. at 7, quoting Panama Canal Commission v. FLRA, 867 F.2d 905, 908 (5th Cir. 1989). We reaffirmed our position that interest arbitration awards resulting from Panel direction under section 7119(b)(1) are involuntary and do not constitute binding arbitration to which exceptions may be filed under section 7122(a). We also confirmed our longstanding position that interest arbitration awards issued under section 7119(b)(2) are voluntary and constitute binding arbitration reviewable by the filing of exceptions under section 7122(a).

In the present case, the interest arbitration was entered into voluntarily under the provisions of section 7119(b)(2) of the Statute. The record shows that the Agency requested the Panel to approve the Agency's joint request with the Union for binding arbitration to resolve a negotiation impasse. See Attachment to Opposition (Apr. 13, 1989, joint request to the Panel for approval of binding arbitration procedure). Therefore, in accordance with Bureau of Reclamation, we conclude that the Agency is not entitled to agency head review under section 7114(c) and its objections to the Arbitrator's bench decisions must be resolved by filing exceptions with the Authority.

IV. Article 12 - Grievance Procedure

A. The Agency's Exception Concerning Article 12 Is Not Moot

Article 12 contains the parties' negotiated grievance procedure. See Exceptions, Attachment 1; Opposition, Attachments. Section 2.C. of Article 12 provides for the exclusion of certain grievances from the grievance procedure but does not specifically exclude adverse action grievances by NEES employees. In a supplemental submission to the Authority dated August 27, 1990, the Union contends that the Agency's exception with respect to Article 12 has been rendered moot. The Union notes the recent enactment into law of the Civil Service Due Process Amendments of 1990, Pub. L. No. 101-376 (the Amendments), that "extends to nonpreference eligible excepted service employees the same adverse action appeal rights enjoyed by competitive service employees." Union's Letter at 1. Accordingly, the Union argues that "under the state of the law that exists today, the[re] is no impediment to the negotiability or enforceability of the contract provision imposed by [the Arbitrator's] award." Id.

The Agency, in a supplemental submission dated September 24, 1990, asserts that its contentions with respect to Article 12 were not rendered moot by the Amendments. The Agency contends that the Amendments do not apply to grievances filed before the effective date of the Amendments and states that the Amendments "provide appeal rights for NEES employees to challenge performance-based and adverse actions which become effective on or after the effective date of this Act." Agency's Response at 1. The Agency contends, among other things, that "[i]f the Authority were to dismiss [its] exceptions . . . the negotiated agreement would go into effect and pending adverse and performance-based actions effected before [the Amendments' effective date] would be processed in a manner which is contrary to law." Id. The Agency also contends that the Arbitrator's award is contrary to the Amendments because the Amendments only apply to NEES employees who have completed 2 years of service and the award would allow the filing of grievances over performance-based or adverse actions after 1 year of service.

The Agency has not opposed the Union's submission and has responded to the motion to dismiss. Because neither party was prejudiced by the Union's submission and the Agency has responded to the Union's submission, we will accept and consider the supplemental submissions. See U.S. Department of the Navy, Long Beach Naval Shipyard, Long Beach, California and International Federation of Professional and Technical Engineers, Local 174, 37 FLRA 1111, 1112 (1990) (supplemental exception was accepted and considered where neither party was prejudiced).

We find that there is no basis on which to dismiss the Agency's exception to the Arbitrator's bench decision concerning Article 12 as moot. The Amendments became effective on August 17, 1990, approximately 1 year after the Arbitrator's bench decision. The Agency's argument that the Amendments do not apply retroactively to grievances pending under the negotiated grievance procedure prior to the effective date is supported by the language of the Amendments. Therefore, we will address the Agency's exception concerning Article 12.

B. Positions of the Parties

1. The Agency

The Agency contends that the Arbitrator's decision concerning Article 12 is deficient because of the "failure to exclude in Section 2.C. NEES employees from utilizing the negotiated grievance procedure to challenge adverse actions under 5 USC 4301 and 5 USC 7701." Exceptions at 3. The Agency maintains that it pointed out to the Arbitrator that existing case law prohibited the consideration of such grievances and sought to include a paragraph in the agreement "reflecting that such matters are not covered under the negotiated grievance procedure." Id. at 4.

The Agency asserts that the Arbitrator exceeded his authority by rendering an award on a negotiability question. The Agency argues that the Arbitrator's award is inconsistent with precedent that excludes NEES employees from using the negotiated grievance procedure to challenge adverse actions taken against them. Regarding the Authority's decision in Carswell Air Force Base, the Agency states that "it is clear that an interest arbitrator's determination with regard to negotiability is not limited solely to Authority precedent." Id. at 4, 5. The Agency argues that "[t]he Authority's decision in Carswell [Air Force Base] allows interest arbitrators to apply well-settled and established Authority decisions in resolving negotiability disputes. Where, as in this case, the Authority case law is not well settled, the interest arbitrator must defer to the Authority." Id. at 4-5. The Agency points out also that certain Authority decisions concerning the right of NEES employees to challenge performance-based and adverse actions under negotiated grievance procedures have been reversed by courts of appeals. The Agency asserts that the law in this area is not well settled and the Arbitrator should have refrained from making a negotiability decision.

The Agency further contends that the "[A]rbitrator's decision to allow NEES employees to grieve adverse and performance-based actions through the negotiated grievance procedure is contrary to law." Id. at 6. The Agency asserts that although its NEES employees are not covered by the requirements of title 5 United States Code for purposes of pay, leave and hours of work, they are covered by title 5 for a number of other aspects of employment including labor-management relations. The Agency denies that unit employees are "in another personnel system for the purposes of adverse personnel actions and performance-based actions" and points out that "[n]o separate appellate structure was created for unit employees to challenge adverse or performance-based actions." Id. The Agency states that while preference eligible bargaining unit employees may challenge adverse or performance-based actions before the MSPB, "NEES employees in the bargaining unit may not." Id. at 7.

2. The Union

The Union contends that the Arbitrator's decision regarding the scope of the grievance procedure is consistent with Authority precedent and case law. The Union argues that "[a]lthough the . . . Statute establishes a mechanism for the Authority to resolve 'negotiability' . . . disputes, an interest arbitrator is not without authority to resolve questions concerning the duty to bargain that arise in interest arbitration." Opposition at 3. The Union contends that an interest arbitrator may "impose a contract provision that an agency claims is nonnegotiable, provided 'the arbitrator applie[s] existing Authority case law in resolving an impasse.'" Id. (citing Carswell Air Force Base, 31 FLRA at 623). The Union states that the Authority "has uniformly rejected the claim that an arbitration procedure covering the termination of nonpreference [eligible] excepted service employees is nonnegotiable and has ordered agencies to bargain over such procedures with representatives of excepted service employees." Id. at 3-4. The Union argues that, notwithstanding "the disposition of [the Authority's holdings] on appeal, the [A]rbitrator was required to and did in fact apply existing FLRA precedent to resolving this negotiability dispute." Id. at 4 (emphasis in original).

The Union states that in Department of the Treasury, Office of Chief Counsel v. FLRA, 873 F.2d 1467 (D.C. Cir. 1989), reversing National Treasury Employees Union and Department of the Treasury, Office of Chief Counsel, 30 FLRA 656 (1987), cert. denied, 110 S. Ct. 864 (1990), (Office of Chief Counsel v. FLRA), the court "acknowledged that nonpreference [eligible] excepted service employees who are employed in 'other personnel systems' may grieve and arbitrate adverse actions regardless of the availability of statutory appeals procedures." Opposition at 4 (citing 873 F.2d at 1472). Citing the Authority's decision in Department of Defense Dependents Schools (DoDDS), Pacific Region and Overseas Education Association (OEA), 22 FLRA 597 (1986) (DoDDS, Pacific Region), the Union contends that the Authority "has ruled that overseas teachers are employed under one of the 'other personnel systems'" referred to in DoDDS, Pacific Region "because they have a personnel system unique to the [F]ederal service." Id. at 5. The Union states that, unlike the Agency's assertion in this case, in DoDDS, Pacific Region the Agency argued that the Union's bargaining unit members "were in 'another personnel system' for adverse action appeal purposes." Id. at 5 n.2 (emphasis in original). The Union asserts that the court's decision in Nieuwdorp v. Library of Congress, 872 F.2d 1000, 1002 (Fed. Cir. 1989), "should not be accorded any weight . . . because the court's statement[] [that overseas teachers were not employed under other personnel systems within the meaning of section 7121(f) of the Statute] was dictum and not the holding of the court." Id. at 8.

C. Analysis and Conclusions

We conclude that the Agency has failed to show that the Arbitrator's bench decision directing the parties to adopt Article 12 as their negotiated grievance procedure is contrary to law. The provision imposed by the Arbitrator establishes a negotiated grievance procedure for the bargaining unit that is silent as to the rights of NEES employees to appeal performance-based and adverse actions. The essence of the Agency's contention is that the Arbitrator improperly failed to include in the provision the Agency's proposed language that explicitly precludes NEES employees from using the negotiated grievance procedure to contest performance-based and adverse actions. However, the Agency has not shown that such a statement must, as a matter of law, be included in an agreement. Further, the Agency has not shown that the provision imposed by the Arbitrator includes any matter that is prohibited by law.

The fact that the provision imposed by the Arbitrator is silent as to the rights of NEES employees to appeal performance-based and adverse actions does not mean, and the Arbitrator did not rule, that NEES employees became entitled to a right that, under applicable law and precedent, they do not have. In this regard, we note that prior to the effective date of the Amendments, August 17, 1990, Federal courts had determined, reversing Authority precedent to the contrary, that NEES employees could not be covered by negotiated grievance procedures for purposes of grieving adverse personnel actions taken against them under 5 U.S.C. §§ 4303 and 7512. See National Treasury Employees Union and Department of Health and Human Services, Region IX, San Francisco, California, 31 FLRA 993 (1988), reversed sub nom. Department of Health and Human Services, Region IX, San Francisco, California v. FLRA, 894 F.2d 333 (9th Cir. 1990); Office of Chief Counsel v. FLRA, 873 F.2d 1467; National Treasury Employees Union and Department of Health and Human Services, Region V, Chicago, Illinois, 25 FLRA 1110 (1987), reversed sub nom. United States Department of Health and Human Services v. FLRA, 858 F.2d 1278 (7th Cir. 1988).

Subsequently, the Authority reexamined its position and held in National Labor Relations Board and National Labor Relations Board Professional Association, 35 FLRA 1116 (1990) (NLRB) that NEES employees are precluded by law from challenging, through a negotiated grievance procedure, an adverse action set forth in 5 U.S.C. § 7512 or an action based on unacceptable performance set forth in 5 U.S.C. § 4303(a). See also Panama Canal Commission and International Association of Firefighters, Local 13, Balboa, Republic of Panama, 35 FLRA 1140 (1990). However, following the enactment of the Amendments, the Authority recognized that "the inclusion of nonpreference eligible excepted service employees within the coverage of negotiated grievance procedures is not inconsistent with law." National Treasury Employees Union and U.S. Department of Health and Human Services, Social Security Administration, Office of Hearings and Appeals, Baltimore, Maryland, 39 FLRA 346, 359 (1991).

Accordingly, prior to August 17, 1990, NEES employees of the Agency would not have been able, as a matter of law, to grieve adverse actions taken against them under the grievance procedure imposed by the Arbitrator in his bench decision, regardless of the presence or absence of an explicit agreement provision specifically excluding those employees. See NLRB, 35 FLRA at 1126 (arbitrator had no jurisdiction as a matter of law to determine the merits of NEES grievant's removal).

As to the Agency's arguments concerning adverse action grievances which may have been brought and have been pending since the date of the Arbitrator's bench decision which imposed Article 12, we note that Section 4 of the Amendments provides:

This Act and the amendments made by this Act shall become effective on the date of the enactment of this Act and, except as provided in section 2(c), shall apply with respect to any appeal or other proceeding brought on or after such date.

Civil Service Due Process Amendments of 1990, Pub. L. No. 101-376, 104 Stat. 461, 463. There is no provision for retroactive effect of the Amendments. Consequently, any adverse action grievances brought by NEES employees prior to August 17, 1990 were subject to the law in effect at the time the grievances were filed and are not affected by the Amendments. As noted above, prior to the passage of the Amendments the Authority had held, in accordance with relevant court decisions, that NEES employees were not entitled to grieve adverse personnel actions taken against them through grievance procedures negotiated under section 7121 of the Statute. See NLRB, 35 FLRA at 1125-26. Therefore, any adverse action grievances brought by NEES employees within the Agency prior to August 17, 1990 would have had to be resolved under the law applicable at the time the grievance was brought. Further, as the Agency has pointed out in its exceptions, the Amendments would not apply to NEES employees who had not completed the 2 years of continuous service set forth in the Amendments as the requirement for coverage. Consequently, even after August 17, 1990, NEES employees who had not completed 2 years of continuous service, would not be entitled to use the negotiated grievance procedure in Article 12 of the parties' agreement.

With regard to the arguments of the parties concerning whether NEES employees of the Agency are "under other personnel systems" for purposes of section 7121(e) and (f) of the Statute, we have ruled that the Agency's personnel system is "another personnel system," within the meaning of section 7121(f) of the Statute. See U.S Department of Defense Dependents Schools, Pacific Region and Overseas Education Association, 39 FLRA 184 (1991). Therefore, we have no jurisdiction to review exceptions to arbitration awards relating to the removal of Agency NEES employees.

We find no merit in the Agency's contention that the Arbitrator exceeded his authority by making an improper negotiability determination when he issued his bench decision on Article 12. The Agency has failed to show that the Arbitrator made any finding concerning the negotiability of a provision governing the appeal rights of NEES employees or that the Arbitrator ignored applicable Authority and court precedent. The Arbitrator simply failed to include specific language requested by the Agency in Article 12. That does not constitute an improper negotiability determination by the Arbitrator and does not alter the fact that NEES employees were excluded as a matter of law from using the negotiated grievance procedure to appeal performance-based and adverse actions.

In summary, because adverse action grievances by NEES employees filed before August 10, 1990, were excluded by law, it is not necessary that the exclusion be stated explicitly in the parties' agreement and the fact that the Arbitrator did not order that the exclusion be stated explicitly does not render the award deficient. Accordingly, we conclude that the Agency has failed to establish that the Arbitrator's bench decision regarding Article 12 of the parties' collective bargaining agreement is contrary to law and its exception to that decision will be denied.

V. Article 48 - Travel

Section 3.

During the time when a unit employee requires medical evacuation from his/her duty station, he/she shall be entitled to transportation at [G]overnment expense. Modes of transportation shall include, but not be limited to, the following:

. . . .

For return of the unit employees from medical evacuation to his/her duty station, he/she shall be entitled to transportation in Space Available, Category 1, priority 1 status. Modes of transportation shall include, but not be limited to, the following:

. . . .

Section 4.

When a unit employee is excused from duty to travel to a point separate from his/her point of work to attend to personal emergencies (such as death of relatives, imminent death of relatives, disability sicknesses of relatives, legal proceedings, etc.) said unit employee shall be authorized Space Available, Category 1, priority 1 travel through military transportation systems. For return, said unit employee shall be authorized Space Available, Category 2A travel through military transportation systems. During the summer recess the unit employee shall travel in accordance with appropriate regulations.

Exceptions, Attachment 1; Opposition, Attachments.

A. Positions of the Parties

1. The Agency

The Agency contends that "[t]o the extent that sections 3 and 4 of Article 48 establish priorities for space available travel, they conflict with [an agency regulation for which a compelling need exists]." Exceptions at 9. Specifically, the Agency argues that those sections conflict with chapter 4 of Department of Defense Regulation 4515.13-R (DOD 4515.13-R).(3) That regulation "prescribes policies governing transportation by DOD-owned or controlled aircraft[,]" and the conditions governing travel of passengers eligible for space available transportation. Id. The Agency states that space available travel is "traffic eligible for space aboard an aircraft which is surplus after space required, i.e., mission essential, traffic has been accommodated[,]" and contends that, under DOD 4515.13-R, "space available travel can only be provided when space is not otherwise needed to satisfy mission requirements." Id.

The Agency asserts that under DOD 4515.13-R, the employees described in sections 3 and 4 of Article 48 would be given category 2B status but under the provision imposed by the Arbitrator the same employees would be granted a higher status. The Agency claims that under the regulation, "individuals within each category travel on a first come, first served basis [and] Section 3 would give bargaining unit employees . . . first priority when traveling from their duty station to attend personal emergencies." Id. at 10. Further, the Agency states that, "with respect to the travel for personal emergencies provided for in section 3, the regulation limits travel to bona fide immediate family emergencies." Id. The Agency argues that section 4 "goes far beyond this regulatory limitation and would include about anything the employees consider an 'emergency.'" Id.

The Agency argues that DOD 4515.13-R "does not require that space available travel be provided as a condition of employment to overseas teachers." Id. at 11. The Agency claims that "[t]he issue of space available travel does not vitally affect the working conditions of . . . unit employees." Id. The Agency contends that when employees are traveling as set forth in sections 3 and 4, they are in a nonduty, nonwork status and, as such, "[t]heir travel decisions are solely a matter of personal concern." Id. The Agency asserts that "even assuming that space available travel is a condition of employment, [the Agency] is under no obligation to bargain on the issue" because it "does not exercise any discretion with respect to policies concerning space available travel." Id. (citing National Treasury Employees Union and Department of the Treasury, Bureau of the Public Debt, 3 FLRA 769, 778 (1980)). The Agency further asserts that the proposal, to the extent that it gives bargaining unit employees priority over other passengers, "directly affects the entitlements of other, nonbargaining unit individuals . . . and is outside the duty to bargain." Id. at 12.

The Agency contends that a compelling need exists for the regulation under section 2424.11(a) and (c) of the Authority's Rules and Regulations because DOD 4515.13-R "implements a Congressional mandate to the Department" and "is essential" to ensure that the Department of Defense "air transportation mission . . . is accomplished in the least costly and most effective and efficient manner." Id. In support of its position, the Agency argues that "the regulation requires that space available travel . . . only be provided when space is not needed to satisfy mission requirements." Id.

The Agency also notes that under Executive Order 11491, as amended (the Order), the Federal Labor Relations Council (the Council) held in American Federation of Government Employees, Local 2612 and Department of the Air Force, Headquarters 416th Combat Support Group (SAC), Griffiss Air Force Base, 3 FLRC 822 (1975) (Griffiss), that agency regulations did not provide a basis on which the Council would grant a petition for review of an arbitration award. The Agency argues that the Council's ruling was superseded by the Statute and no longer applies. Therefore, the Agency asserts, "an agency may take an exception to an arbitrator's award on the basis that the award violates an agency regulation." Exceptions at 16-17.

2. The Union

The Union contends that "[a]t no time during negotiations did [the Agency's] negotiators allege that Article 48, §§ 3 and 4 were nonnegotiable because they conflicted with an agency regulation for which there is a compelling need." Opposition at 9. The Union asserts that "[b]y appealing the [A]rbitrator's award on the ground that it conflicts with an agency regulation, without first alleging that the proposal was nonnegotiable for that reason, [the Agency] deprived [the Union] of the right to seek a compelling need determination." Id. at 9-10. The Union denies that the provision conflicts with an Agency regulation for which there is a compelling need and points out that a similar issue was found to be negotiable in Overseas Education Association, Inc. and Department of Defense Dependents Schools, 27 FLRA 492 (1987), petition for review denied sub nom. Overseas Education Association, Inc. v. FLRA, 858 F.2d 769 (D.C. Cir. 1988).

The Union argues that under section 7122(a)(1) of the Statute, the term "rule or regulation" is limited to Government-wide rules or regulations. The Union states that if section 7122(a)(1) "is construed to cover agency as well as [G]overnment-wide rule or regulation, a literal reading of that subsection would require the Authority to reverse an interest arbitrator's award that conflicts with an agency regulation regardless of whether or not there is a compelling need for the regulation." Id. at 10 (emphasis deleted). The Union contends that sections 3 and 4 of Article 48 "merely shift unit employees around space-available categories and in no way require the [A]gency to transport them when standby space is not available due to space required for 'mission-essential' traffic[.]" Id. at 11. The Union claims that because sections 3 and 4 do not interfere with the Agency's mission, "there is not, by definition, a compelling need for the [A]gency's regulations concerning space-available . . . transportation." Id.

B. Analysis and Conclusions

1. Preliminary Matter

For the following reason, we will not consider the Agency's argument that the Arbitrator's bench decision on Article 48 is deficient because Article 48 conflicts with an agency regulation for which there is a compelling need. The Union contends that "[a]t no time during negotiations did [the Agency's] negotiators allege that Article 48, §§ 3 and 4 were nonnegotiable because they conflicted with an agency regulation for which there is a compelling need." Opposition at 9. The Agency does not dispute the Union's contention. In these circumstances, we find that the issue of compelling need with respect to Article 48 was not raised before the Arbitrator, and is being raised for the first time by the Agency before the Authority. Section 2429.5 of the Authority's regulations provides, as relevant here, that the Authority will not consider any issue which was not presented in the proceedings before the arbitrator. Accordingly, we will not consider the Agency's compelling need argument with respect to Article 48.

2. The Award as to Article 48 Is Not Deficient

We conclude, contrary to the Agency's assertions, that the provision imposed by the Arbitrator in his bench decision on Article 48 concerns a negotiable condition of employment for bargaining unit employees over which the Agency has discretion to bargain. Consequently, the Agency's exception fails to establish that the bench decision is deficient and the exception will be denied.

Under the Statute, agencies are obligated to bargain over union proposals concerning conditions of employment, provided that the proposals do not violate law, Government-wide regulation, or an agency regulation for which there is a compelling need. Conditions of employment are defined as personnel policies, practices, and matters, whether established by rule, regulation, or otherwise, affecting working conditions. 5 U.S.C. § 7103(a)(14).

The Authority considered proposals relating to space available travel rights for employees of the Agency in Overseas Education Association and Department of Defense Dependents Schools, 29 FLRA 485, 491-92 (1987), enforced sub nom. Department of Defense Dependents Schools v. FLRA, 863 F.2d 988 (D.C. Cir. 1990) and Overseas Education Association, Inc. and Department of Defense Dependents Schools, 27 FLRA 492, 513-16 (1987), petition for review denied sub nom. Overseas Education Association, Inc. v. FLRA, 858 F.2d 769 (D.C. Cir. 1988). In each of those decisions, the Authority determined that there is a direct connection between furnishing transportation facilities and services for the agency's employees in overseas assignments and the working conditions of those employees and that, consequently, proposals relating to the provision of transportation services concern a condition of employment. See 29 FLRA at 491; 27 FLRA at 517.

The provision in Article 48 concerns the categories and priorities for space available travel of Agency employees in connection with medical evacuation and personal emergencies and, therefore, concerns the conditions of employment of those employees. We reject the Agency's contention that the provision does not concern working conditions because employees would not be actually performing work-related duties at the time the travel actually occurs. The space available travel covered by Article 48 of the agreement arises directly from the nature of the overseas assignments of those employees and is part of their conditions of employment. Therefore, for the reasons discussed above, we find that the agreement provision imposed by the Arbitrator in Article 48 of the parties' collective bargaining agreement concerns employees' working conditions over which the Agency was obligated to negotiate.

The Agency also contends that it has no duty to bargain over space available travel and priorities for employees because it has no discretion over the Military Airlift Command (MAC), which is administered by another component of the Department of Defense. However, that argument has also been considered and rejected by the Authority. In Overseas Education Association and Department of Defense Dependents Schools, 29 FLRA 485, 492 (1987), the Authority stated that "a component of an agency is obligated to bargain with the exclusive representative of its employees over conditions of employment even though control over a particular condition of employment resides in another component of the same agency" unless the discretion is limited by law, Government-wide rule or regulation, or agency regulations supported by a compelling need." See also Overseas Education Association, Inc. and Department of Defense, Office of Dependents Schools, 22 FLRA 351, 361 (1986), aff'd sub nom. Overseas Education Association, Inc. v. FLRA, 827 F.2d 814 (D.C. Cir. 1987).

The Agency's argument that the Arbitrator's decision is deficient because Article 48 of the agreement would directly affect nonbargaining unit individuals is also similar to an argument addressed by the Authority in 27 FLRA 492. In that decision, the Authority rejected the Agency's argument that a proposal regarding housing was nonnegotiable because of its impact on employees outside the bargaining unit. The Authority held that "otherwise negotiable proposals which directly determine conditions of employment of bargaining unit employees are not rendered nonnegotiable simply because they also [a]ffect conditions of employment outside of the bargaining unit to a limited degree or in an indirect way." 27 FLRA at 495. Therefore, this part of the Agency's exception provides no basis for finding the award deficient.

V. Decision

The Agency's exceptions to the Arbitrator's bench decision concerning Article 45 are dismissed as moot. The Agency's exceptions to the bench decisions concerning Article 12 and Article 48 are denied.

APPENDIX

Chapter 4 of DOD 4515.13-R, entitled "Space Available Passengers," provides in relevant part:

SECTION A--SPACE AVAILABLE POLICY

. . . .

4-3. Eligibility. The categories of passengers listed in Sections B through D may be permitted space available transportation. The order in which these categories are listed will be the normal precedence of movement. The listing within each of the categories is not intended to indicate a precedence within categories. Eligible personnel in each category will be furnished space available transportation on a first-in first-out basis. The installation commander may change the precedence of any categories of space available movement for emergency or extreme humanitarian reasons when requested by the sponsoring military Service, and the facts provided support such exception. The installation commander may delegate the authority to make changes to the terminal reservation section (TRS). Where MAC units are tenants, the local MAC commander should advise the installation commander of this authority and offer technical assistance as needed. When a movement priority is changed the passengers will be moved no higher than the bottom of the category I space available list. Reservations will not be made for any category of space available passenger, and there is no guaranteed space for such passengers. The DOD is no obligated to continue an individual's travel or return him or her to point of origin. . . .

4-4. Deleted.

SECTION B--TRANSPORTATION OF PASSENGERS BETWEEN THE CONUS AND OVERSEAS BY DOD-OWNED OR-CONTROLLED AIRCRAFT

4-5. Eligible Passengers:

a. Category 1. This authority applies to bona fide immediate family emergencies, as determined by the service regulations, of a member of the immediate family of:

(1) US citizen civilian employees of the DOD stationed overseas. Option to utilize space required travel is authorized in paragraph 3-3b(3).

. . . .

b. Category 2:

. . . .

(2) Category 2B:

(b) Close blood or affinitive relatives who are permanent members of the household and dependent upon a military member, a civilian employee of the DOD, or American Red Cross personnel stationed with the DOD overseas, when such member or employee is authorized transportation of legal dependents at Government expense. Travel must be performed in conjunction with the sponsor's or his or her dependent's PCS [permanent change of station] move and is permitted only fo