41:1413(109)AR - - DOD, Army and Air Force Exchange Service, George AFB, CA and NFFE Local 977 - - 1991 FLRAdec AR - - v41 p1413



[ v41 p1413 ]
41:1413(109)AR
The decision of the Authority follows:


41 FLRA No. 109

FEDERAL LABOR RELATIONS AUTHORITY

WASHINGTON, D.C.

U.S. DEPARTMENT OF DEFENSE

ARMY AND AIR FORCE EXCHANGE SERVICE

GEORGE AIR FORCE BASE, CALIFORNIA

(Agency)

and

NATIONAL FEDERATION OF FEDERAL EMPLOYEES

LOCAL 977

(Union)

0-AR-2007

DECISION

August 28, 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 Donald A. Anderson 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.

The grievance concerned the Agency's unilateral reduction in the commission rates of its automotive mechanics who are prevailing rate employees. After the Arbitrator issued an award in which he determined that the Agency violated the parties' collective bargaining agreement, the Arbitrator issued a second award in which he directed the parties to negotiate appropriate wage rates and to pay the mechanics the difference between the adjusted rates and the appropriate rates if the appropriate rates were found to be different.

For the following reasons, we conclude that a portion of the Arbitrator's second award is deficient. Accordingly, we will modify that portion of the award.

II. Background

On July 27, 1990, the Arbitrator issued an award ("initial award") in which he found that the Agency violated 5 U.S.C. § 5343, Federal Personnel Manual (FPM) Supplement 532-2 and the parties' agreement by improperly reducing the commission rates of automobile mechanics without Union participation in the wage rate adjustment process. Based on his findings, the Arbitrator directed the parties to: (1) meet and determine the appropriate commission rates for automotive mechanics; and (2) pay the mechanics the difference between the adjusted rates and the appropriate rates if the appropriate rates were determined to be different. The Arbitrator also retained jurisdiction for 60 days in order to provide the parties with assistance or third party intervention in resolving the issue.

Because the parties were unable to determine the appropriate wage rates, on September 21, 1990, the Arbitrator issued another award ("remedy award") providing a remedy for the violation. The Arbitrator directed the parties to negotiate appropriate wage rates and to pay the mechanics the difference between the adjusted rates and the appropriate rates if the appropriate rates were found to be different.

Based upon the findings and conclusions contained in his initial award, and on notification by the parties that they were not able to establish the appropriate commission rate, the Arbitrator ordered the following remedy:

1. Based on the Arbitrator's conclusion that the Activity's unilateral action of changing mechanic rates relative to the instant arbitration without participation of the NFFE, violated the parties['] collective bargaining agreement, it is appropriate that he order the parties to meet for the purpose of reviewing the Activity['s] procedure and conclusions relative to its survey and subsequent wage rate change.

2. After such information is duly reviewed and examined, and in the event of disagreement as to the appropriateness of such rates, the parties are to negotiate appropriate wage rate(s) for affected bargaining unit prevailing rate and non-appropriated fund employees in the Golden Gate Exchange Region pursuant to the parties['] collective bargaining agreement, Article III, Section 3, Article IV, Section 2; Title 5, 5343, P.L. 92-392; F.P.M. Supplement 532-2; and the Federal Prevailing Rate Advisory Committee guidelines.

3. In cases where it is found that affected employees were denied appropriate compensation, as a result of the wage change action, they are to be reimbursed for any lost wages and properly credited when such change adversely affected benefits.

Award at 1-2.

The Agency filed exceptions to both awards. In U.S. Department of Defense, Army and Air Force Exchange Service, George Air Force Base, California and National Federation of Federal Employees, Local 977, 40 FLRA 79 (1991) (Army and Air Force Exchange Service), we concluded that the Agency had not demonstrated that the initial award was deficient. We also determined that the Arbitrator's retention of jurisdiction was proper because the Agency was not prevented from filing exceptions to the remedy award. Accordingly, we denied the Agency's exceptions.

We rejected the Agency's argument that the award was contrary to FPM Supplement 532-2. We determined that the automobile mechanics "are subject to Appendix V of Federal Personnel Manual (FPM) Supplement 532-2," and that applicable law and regulation--FPM Supplement 532-2 and 5 U.S.C. § 5343--require union participation in all phases of the system for fixing and adjusting the pay rates for prevailing rate employees. Army and Air Force Exchange Service, 40 FLRA at 82. We found, therefore, that the Agency's unilateral reduction in the commission rates of its mechanics prevented the Union from participating in the process for fixing and adjusting the wage rates of those prevailing rate employees.

As to the Agency's argument that it was privileged, pursuant to an agreement between the parties reached at a meeting of the Federal Prevailing Rate Advisory Committee (FPRAC), to unilaterally change the commission rates of automobile mechanics, we found that the Agency had "not demonstrated that such an agreement exists . . . ." Id.

We also rejected the Agency's argument that the Arbitrator's retention of jurisdiction was improper. We noted that the Arbitrator had retained jurisdiction simply to assist the parties if they were unable to determine the appropriate commission rate. We found, therefore, that the Agency had "failed to establish that the Arbitrator's retention of jurisdiction for this limited purpose rendered the award deficient." Id. at 83. Accordingly, we denied the Agency's exceptions.

III. Positions of the Parties

A. The Agency

The Agency contends that the Arbitrator's remedy award is deficient because it violates FPM Supplement 532-2, Appendix V. The Agency argues that the award requires the renegotiation of an agreement reached by the parties before the FPRAC that permitted the Agency, unilaterally, to change the commission rates for auto mechanics, provided that the change was within a stated percentage range. According to the Agency, the award requires the renegotiation of a matter which has been previously negotiated.

The Agency also contends that the award is deficient because it violates 5 U.S.C. § 5343, which codifies the prevailing rate wage system. The Agency asserts that the award requires it to negotiate appropriate commission rates for prevailing rate employees. Relying on American Federation of Government Employees, AFL-CIO and Department of Defense, Department of the Army and Air Force, Headquarters, Army and Air Force Exchange Service, Dallas, Texas, 32 FLRA 591 (1988) (AAFES), the Agency argues that the commission rates for its prevailing rate mechanics are nonnegotiable. The Agency asserts that the decision in AAFES is not affected by the Supreme Court's decision in Fort Stewart Schools v. FLRA, 110 S. Ct. 2043 (1990) (Fort Stewart).

B. The Union

The Union contends that the award is consistent with law. The Union asserts that the award "simply orders that commissioned mechanics['] pay rates be set according to law." Opposition at 2.

The Union also contends that the award does not require the renegotiation of an agreement between the parties. The Union argues that Article III, Section 3 of the parties' agreement requires that agreements between the Union and the Agency "must be signed by the N.F.F.E. and A.A.F.E.S. Headquarters." Id. The Union asserts that there is no indication in the record that any agreement was signed or that any Union official was present or represented at the FPRAC meeting.

The Union also argues that, because 5 U.S.C. § 5343, Public Law 92-392, and FPM Supplement 532-2 require that unions participate in setting and adjusting the pay of prevailing rate employees, "[a]ny negotiation to violate [those] provision[s] would clearly be . . . illegal." Id.

IV. Analysis and Conclusions

We conclude that the Agency's first exception provides no basis on which to find the award deficient. We will deny that exception to the award. We further conclude that the portion of the award directing the Agency to negotiate the commission rates of its mechanics is contrary to law. We will modify the award to provide that appropriate wage rates for automotive mechanics be determined consistent with the parties' collective bargaining agreement and applicable law, rule and regulation, including 5 U.S.C. § 5343(c)(2).

A. First Exception

The Agency contends that the Arbitrator's award is contrary to FPM Supplement 532-2, Appendix V. The Agency argues that the award requires the renegotiation of an agreement between the parties reached before the FPRAC permitting the Agency to unilaterally establish the commission rates for its mechanics.

The Agency raised the same exception as one of its exceptions to the initial award. As noted above, in Army and Air Force Exchange Service we specifically rejected the Agency's contention that, pursuant to an agreement between the parties reached at a FPRAC meeting, the Agency could unilaterally change the commission rates of its automotive mechanics. We determined in that case that there was no evidence in the record that such an agreement existed. The record in this case similarly contains no evidence that such an agreement existed. The Agency's exception in this case, therefore, provides no basis for finding the award deficient under section 7122(a) of the Statute.

B. Second Exception

The Agency asserts, without contradiction, that the automotive mechanics in this case are covered by the Prevailing Rate Systems Act of 1972 (the Act). Exceptions at 4; see also FPM Supplement 532-2, Appendix V and Attachment 1 to the Agency's Exceptions at 4. There is no contention, and no evidence in the record, that these employees are covered by section 9(b) of the Act and section 704 of the Statute. Pay-setting under the prevailing rate system is specifically provided for by law and, therefore, is excluded from the definition of conditions of employment under section 7103(a)(14)(C) of the Statute. Consequently, proposals concerning wage rates for employees covered under the prevailing rate system do not concern conditions of employment and are, therefore, nonnegotiable. National Association of Government Employees, Local R4-26 and Department of the Air Force, Langley Air Force Base, Virginia, 40 FLRA 118, 141-142 (1991).

The award requires the Agency, among other things, to "negotiate appropriate wage rate(s) for . . . prevailing rate and non-appropriated fund employees . . . ." Award at 1. Because the award requires the Agency to negotiate concerning the wage rates for prevailing rate employees, a matter which is nonnegotiable under section 7103(a)(14)(C) of the Statute, the award is deficient to that extent. In this regard, we note that, inasmuch as the Supreme Court's decision in Fort Stewart concerned employees who are not subject to the Act, that decision is not applicable to this case. Accordingly, we will modify the award to require that the Union's participation in the wage rate process be conducted in a manner consistent with law and applicable regulations.

V. Decision

The award is modified to replace paragraph 2 with the following:

2. After such information is duly reviewed and examined, and in the event of disagreement as to the appropriateness of such rates, the appropriate wage rate(s) for affected bargaining unit prevailing rate and non-appropriated fund employees in the Golden Gate Exchange Region shall be determined consistent with the parties' collective bargaining agreement and applicable law, rule and regulation, including 5 U.S.C. § 5343(c)(2). Section 5343(c)(2) provides for "participation at all levels by