43:0102(11)AR - - Army Medical Activity, Fort Knox, KY and AFGE Local 2302 - - 1991 FLRAdec AR - - v43 p102



[ v43 p102 ]
43:0102(11)AR
The decision of the Authority follows:


43 FLRA No. 11

FEDERAL LABOR RELATIONS AUTHORITY

WASHINGTON, D.C.

U.S. DEPARTMENT OF THE ARMY

ARMY MEDICAL ACTIVITY

FORT KNOX, KENTUCKY

(Agency)

and

AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES

LOCAL 2302

(Union)

0-AR-1842

DECISION

November 14, 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 John S. Herrick 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 Arbitrator found that the Agency violated the parties' collective bargaining agreement when it changed the work schedule of unit employees by implementing a 24-hour tour of duty. The Arbitrator: (1) directed the Agency to return the employees to the work schedule and pay formula in effect prior to the change and maintain the earlier schedule and pay formula until the 24-hour schedule could be implemented following compliance with the parties' agreement; (2) advised the Agency to fully negotiate and successfully settle all applicable points of contention prior to the implementation; and (3) directed the Agency to make the affected employees whole by giving them backpay based on the pay formula in effect prior to the change.

We conclude that the portions of the award directing the Agency to negotiate the proper pay formula, including premium and overtime computations, and to pay backpay to affected employees are deficient under section 7122(a) of the Statute. Accordingly, we will modify the award by striking these portions. We will deny the remainder of the Agency's exceptions.

II. Background

The employees involved in this dispute are Emergency Medical Technicians (EMTs) in the Agency's ambulance service. By letter of February 4, 1986, the Agency notified the Union that it intended to change the EMTs' work schedule on or about March 16, 1986. The letter stated, in pertinent part:

Under the provisions of Article 69 of the Negotiated Agreement you are hereby notified that [the Agency] will implement the following changes to conditions of employment of Ambulance Service employees on or about March 16, 1986.

The Ambulance Service will adopt a new work schedule. The present three 8-hour shifts and 40-hour work week will be eliminated. The new schedule will result in the formation of three informal work groups which will each work 24-hour shifts followed by 48 hours off duty.

Employee pay will increase substantially. All employees will be paid at a premium rate of 5 percent over their normal wage. Under the Fair Labor Standards Act [FLSA], any hours worked in excess of 106 hours in a pay period will be paid at the overtime rate of time and a half. A standard 3-week cycle which would repeat throughout the year is being considered to help personnel in their personal planning[.]

Exceptions, Tab 3.(1)The letter also informed the employees of available sleeping quarters, holiday pay and leave procedures. By letter of February 6, 1986, the Union notified the Agency that, pursuant to "Article 69, Section 2 b., the Union agrees to implementation of [the Agency's] February 4, 1986 proposal."(2) Exceptions, Tab 4.

By letter dated February 19, 1986, the Agency clarified its earlier letter as it pertained to the computation of overtime pay. The Agency's letter stated, in pertinent part:

To clarify paragraph 3 . . . , the following information is provided: Any hours worked in excess of 106 hours in a pay period will be paid the overtime rate under the [FLSA]. The formula for standby pay computation . . . is enclosed for your information.

Exceptions, Tab 5.(3)

By letter dated February 21, 1986, the Union rejected the Agency's clarification and stated that "[t]he agreement reached between [m]anagement and the Union, dated 4 February 1986, stands as originally worded." Id., Tab 6. The Union requested the Agency to provide documentation to substantiate the Agency's "claim that the ambulance section comes under the Firefighter [7(k)] portion of the [FLSA]." Id.

On February 28, 1986, the Agency informed the Union that the decision that the ambulance section comes under the firefighter portion of the FLSA "was made at the Office of Personnel Management [OPM] in conjunction with Headquarters, Department of the Army." Exceptions, Tab 7. The Agency provided the Union with documentation in support of the decision. On March 4, 1986, the Agency met with the EMTs to further clarify its position.

Noting the Agency's meeting with the EMTs and contending that the Agency's February 4, 1986 letter became the agreement between the Agency and the Union concerning implementation of the 24-hour tour of duty for the EMTs, the Union asked the Agency on March 6 to clarify whether it wished to let the letter of February 4, 1986 "stand in total as originally written with interpretation left to a third party" or whether it wished "to negate the agreement, in writing, and enter immediately into bargaining[.]" Exceptions, Tab 8.

On March 7, 1986, the Union filed a grievance alleging that the EMTs did not come within section 7(k) of the FLSA. The grievance requested that the employees "be paid in accordance with the applicable laws, rules and regulations upon implementation of [the 24-hour tour of duty], excluding the 7(K) provisions." Id., Tab 10, Enclosure 2. The Agency implemented the change in the EMTs' tour of duty on March 16, 1986. On March 17, the Agency informed the Union that it was "complying with the implementation set forth" in the February 4, 1986 letter. Exceptions, Tab 9.

To resolve the Union's grievance, the Agency sought a redetermination on June 11, 1986 from OPM "as to whether or not [the EMTs] do, in fact, fit the definition of [section] 7(k) of the FLSA." Id., Tab 10. The Union's grievance was scheduled for arbitration in November 1986, but the parties "agreed to defer arbitration until OPM issued a decision . . . ." Id., Tab 18. On December 2, 1986, OPM informed the Department of the Army that the EMTs "are not covered by section 7(k) of the FLSA." Id., Tab 11. On January 23, 1987, the Agency advised the Union of OPM's decision. The Agency stated that it was "working on the pay computation formula and backpay for the affected employees." Id., Tab 13.

On March 14, 1988, the Finance Center issued a memorandum containing new guidance concerning overtime pay computations for EMTs. The memorandum stated that it superseded all previous guidance, including the Finance Center's memorandum of June 12, 1987, and was retroactive to the first full biweekly pay period beginning on or after July 21, 1987. See id., Tab 24.

By letter of March 24, 1988, the Agency gave the Union a copy of the Finance Center memorandum. The letter stated that "[t]he pay formula for the period March 16, 1986 to August 1, 1987 has still not been finalized, pending another court decision." Id., Tab 25. The letter also included management's proposal on establishing eating and sleeping hours and verification of time cards, and stated that any questions or proposals should be submitted to management's designated representative. In April and May 1988, the Union and the Agency exchanged correspondence regarding the Union's requests for information and meetings regarding the implementation of the pay plan. On May 18, 1988, the Union informed the Agency that it had not received the requested information and asked that implementation of the pay plan be postponed until the information was furnished and negotiations were completed. By letter of May 23, 1988, the Agency stated that it had "in its possession a valid pay formula and must implement it." Id., Tab 27. The letter stated that the Agency had given the Union "adequate notice of management's intent to implement the new pay formula, and ample opportunity to discuss any questions or proposals that the [U]nion may have concerning implementation of the formula." Id.

On June 1, 1988, the Union filed the grievance involved in this case. The Union contended, among other things, that the employees "were placed and remain on an illegal 24 hour shift and an invalid pay plan." Id., Tab 28. The Union requested that: (1) EMTs be returned to 8-hour shifts, until such time as a 24-hour shift "is legitimately established"; (2) backpay be paid to all EMTs in accordance with an 8-hour shift; and (3) full negotiations be completed before a 24-hour shift is implemented. Id.

The parties were unable to resolve the grievance and the matter was submitted to arbitration.

III. Arbitrator's Award

On October 18, 1989, the Arbitrator issued an initial award finding that the grievance was timely. Noting that the "goal of the parties" was "to insure that [the] employees are compensated in accordance with applicable[] laws, rules[] and regulations," the Arbitrator directed the parties, through "negotiation," to work out an "equitable settlement" of the dispute. Exceptions, Exhibit 1 at 2.

On October 22, 1989, the Union sought clarification of the award and requested the Arbitrator to issue a decision resolving the dispute. The Union stated that the Arbitrator had not "decide[d] any of the contract issues raised or FLSA violations" with respect to the "approved pay formula[.]" Id., Exhibit 2 at 1.

On November 1, 1989, the Arbitrator advised the parties that he had been undergoing medical treatment and that he expected to rule on the case shortly. On November 13, 1989, the Arbitrator issued a clarification of his initial award. In the clarified award, the Arbitrator again found that the grievance was timely. Noting that the parties were unable to agree on the issues, the Arbitrator framed the issues as follows:

A) Is the 24 HR ON/48 HR OFF schedule which replaced the original schedule valid and legal as it was implemented by the Agency?

B) Is the method by which the Agency resolved to pay the back wages of the EMT personnel from the time of original implementation of the change in scheduling to its final resolution fair and equitable to all concerned?

C) Is the pay formula under which the EMT personnel are currently compensated a valid and legal pay formula?

Award at 3.

The Arbitrator stated that the underlying issue in this case concerned the "validity and legality" of the 24-hour tour. Id. at 4. The Arbitrator stated that the Agency clearly had the authority under the parties' contract to implement the new work schedule, but that this implementation "is governed by Article 69." Id.

The Arbitrator found that when the Agency submitted its letter of February 4, 1986 to the Union proposing to implement the change in EMTs' tour of duty and the Union agreed to the letter on February 6, 1986, the "requirements of Article 69 were met . . . ." Id. According to the Arbitrator, "at this juncture" the letter of February 4, 1986 became the agreement between the parties, and "thus the 24-hr tour [was] valid and legal." Id.

However, the Arbitrator further found that by the Agency's letter of February 19, 1986, in which the Agency "attempted to clarify" and "change" part of "the new agreement between" the parties, the Agency "effectively evoked the procedural requirements of Article 69 concerning [U]nion notification of intent, and allotted time for [U]nion response." Id. The Arbitrator found that under Article 69, the Union's letter of February 21, 1986 constituted a rejection of the change proposed in the Agency's letter of February 19, 1986. Noting the Agency's March 4, 1986 meeting with the EMTs and the correspondence in March set forth above, the Arbitrator found that the Agency's implementation on March 16, 1986 of the new 24-hour schedule and the subsequent pay formula did not comply with the requirements of Article 69 and was "invalid and illegal." Id. at 5.

As a remedy, the Arbitrator: (1) directed the Agency to return the EMTs to the three 8-hour shifts schedule and pay formula in effect prior to March 16, 1986 and to maintain the previous schedule and pay formula "until such a time as the Agency can implement the new 24hr tour adhering completely with Article 69, and other applicable articles of the Agreement"; (2) "advised that the Agency fully negotiate and successfully settle all applicable points of contention (i.e.-proper sleeping facilities; proper direction for record keeping requirements with regard to eat, and sleep time; proper pay formula including premium and overtime computations; et. al.) prior to the implementation"; and (3) directed that the employees be made whole on the basis that the "subsequent pay formula was invalid due to improper implementation." Id. (emphases in original). The Arbitrator directed that backpay be "computed on the formula in place prior to the [March 16, 1986] implementation of the invalid tour, and subsequent pay formula; i.e., the back pay will be in accordance with the pay formula in effect, with regard to base pay, premium pay, and overtime pay, for the [8-hour] tours prior to [March 16, 1986]." Id.

IV. Positions of the Parties

A. Agency

The Agency contends that the award is deficient because it is inconsistent with Federal laws and regulations regarding pay for employees who perform work on 24-hour/standby shifts. The Agency states that the "payment of premium pay on an annual basis for [standby] tours is [governed by] 5 USC 5545(c)(1) and 5 CFR 550.141 if [such tours are] authorized by the [A]gency with the approval of OPM." Exceptions at 2. The Agency asserts that such tours were authorized by the Agency and approved by OPM as required by 5 U.S.C. § 5545(c)(1) and 5 C.F.R. § 550.141. According to the Agency, the award of backpay would result in "an illegal 'windfall' of overtime pay for employees who worked a 24-hour tour and who were compensated by premium pay and overtime pay in accordance with Federal statute and OPM regulation[s]." Id. at 4. The Agency asserts that it "has no choice but to pay the employees in accordance with 5 USC 5545(c)(1)[, 5 C.F.R. § 550.141] and [FPM Letter 551-14], both for the current period and the retroactive period. That is, the employees are to be paid premium and overtime pay, not just straight overtime pay as required by the Arbitrator."(4) Id. The Agency contends that "[t]o attempt to fashion some other means of paying these employees, as the [A]rbitrator awards, is inconsistent with these Government-wide standards." Id. at 5.

The Agency disputes the Arbitrator's conclusion that "Article 69 negotiations should have been initiated by the [A]gency's February 19, 1986 letter[.]" Exceptions at 7. The Agency asserts that its letter concerned "overtime and premium pay computation, a matter which was not within the discretion of the [A]gency to change, and a matter outside of the duty to bargain." Id. at 4. The Agency contends that after OPM decided that EMTs were not covered by section 7(k) of the FLSA, the Agency "followed the pay formula as required under the law and in accordance with the FPM interpretation." Id. at 5. The Agency asserts that the Union had the opportunity to submit impact and implementation proposals, but submitted only substance proposals concerning the rate of overtime pay. The Agency contends that even "assuming that Article 69 impact and implementation negotiations were not properly completed in 1986, this does not entitle employees to an award of 4 years of backpay (to March 1986), stemming back 2 years before their grievance was even filed (June 1988)." Id. at 7.

The Agency also contends that the establishment of a 24-hour tour was a reserved management right under section 7106(b)(1) of the Statute. The Agency states that the tour change was "directly related to and determinative of the numbers of employees assigned to a tour and was directly related to the [A]gency's organizational structure." Id. Citing Authority precedent, the Agency contends that management's decision concerning the number of shifts it will operate is nonnegotiable. Therefore, the Agency argues that it was not required to bargain with the Union over the establishment of the 24-hour shift.

Finally, the Agency contends that the Arbitrator "was not fully capable of rendering a decision" on the grievance. Id. at 9. Noting that the Arbitrator had deferred ruling on the grievance until he had returned to health, the Agency asserts that the award "avoids all of the factual issues presented by the witnesses for both parties . . . and focuses on an implementation of the 24-hour shift nearly four years before, and over 2 years before the present grievance was filed[.]" Id. at 8. The Agency states that the award "should be remanded if it is not overturned due to its failure to recognize Federal pay guidance." Id.

B. Union

As an initial matter, the Union argues that the Agency's exceptions are untimely. The Union states that the Agency "made no attempt to take exception with the [A]rbitrator's [initial] award." Opposition at 2. The Union contends that its clarification request and the Arbitrator's response to it did not "extend the time limits to file an exception" to the initial award. Id.

The Union further argues that the Agency "has not provided any specific evidence that the award (return to status quo) is contrary to any law, rule or regulation." Id. at 1. According to the Union, the Arbitrator "was mandated by the language of the contract to frame the issues [and the] wide latitude concerning the issues gives rise to little if any challenge to the [A]rbitrator's authority." Id. The Union asserts that the award draws its essence from the agreement and that management's actions were illegal. Finally, the Union contends that the Agency's "last ditch effort to deny these employees their long overdue compensation rests with discrediting the [A]rbitrator[,]" and asserts that the Agency's claim in this regard constitutes an "unjust assault" on the Arbitrator. Id. at 2.

V. Analysis and Conclusions

A. The Agency's Exceptions Are Timely Filed

We conclude that the Agency's exceptions are timely filed. The Arbitrator's initial award did not make any specific findings of fact and conclusions as to the merits but rather directed the parties to settle the matter through negotiations. The exceptions do not raise issues related to the initial award but rather concern matters addressed in the Arbitrator's clarification award. We find, therefore, that the alleged deficiencies in the award asserted by the Agency did not arise until the Arbitrator issued his clarification award dated November 13, 1989. Consequently, the time period for filing such exceptions did not commence until service of the clarification award. See National Treasury Employees Union, Chapter 199 and U.S. Department of the Treasury, Bureau of the Public Debt, 35 FLRA 668, 672 (1990); United States Department of the Interior, Bureau of Land Management, Eugene District Office and National Federation of Federal Employees, Local 1911, 6 FLRA 401, 403 n.2 (1981). The Agency's exceptions were filed within the applicable time period from the date of service of the clarification award and, therefore, were timely filed.

For convenience of analysis, we will consider the Agency's exceptions as they relate to each of the three parts of the Arbitrator's award.

B. The Agency Has Not Demonstrated that the First Part of the Arbitrator's Award Is Deficient

The Arbitrator found that the Agency's implementation on March 16, 1986 of the new 24-hour schedule and the subsequent pay formula did not comply with the requirements of Article 69 and was invalid and illegal. The first part of the Arbitrator's award directs the Agency to return the EMTs to the three 8-hour shifts schedule and pay formula in effect prior to March 16, 1986 and to maintain the previous schedule and pay formula "until such a time as the Agency can implement the new 24hr tour adhering completely with Article 69, and other applicable articles of the Agreement." Award at 5 (emphasis in original). The Agency has not demonstrated that this aspect of the award is deficient under the Statute.

The Agency's contention that its establishment of the 24-hour tour was nonnegotiable under section 7106(b)(1) of the Statute provides no basis for finding this aspect of the award deficient. The Arbitrator recognized that the Agency "clearly has the authority . . . to implement the new work schedule," but "this implementation [was] governed by Article 69" which required bargaining on implementation of the change. Award at 4. Thus, the Arbitrator found that the Agency was obligated to comply with Article 69 with respect to implementation of the change. He did not find that management was obligated to bargain with the Union over its decision to establish the 24-hour tour of duty. Therefore, we find that the award does not violate section 7106(b)(1) of the Statute. See, for example, Department of Health and Human Services, Social Security Administration, Baltimore, Maryland and Social Security Administration, Jamestown, New York District Office, Jamestown, New York, 34 FLRA 765, 770 (1990) (agency's decision to change a condition of employment constituted an exercise of a management right under section 7106, however, agency was obligated to bargain over the impact and implementation of the change); U.S. Customs Service (Washington, D.C.); and U.S. Customs Service, Northeast Region (Boston, Massachusetts), 29 FLRA 891, 900 (1987) (agency was obligated to bargain with union concerning the impact and implementation of a change in conditions of employment).

Moreover, the Agency's contentions that the Arbitrator erred in concluding that "Article 69 negotiations should have been initiated by the [A]gency's February 19, 1986 letter" and that the Union failed to submit impact and implementation proposals provide no basis for finding the award deficient. Exceptions at 7. We construe the Agency's contentions as a claim that this part of the award fails to draw its essence from the parties' collective bargaining agreement. To demonstrate that an award fails to draw its essence from an agreement, a party must show that the award: (1) cannot in any rational way be derived from the agreement; or (2) is so unfounded in reason and fact, and so unconnected with the wording and the purpose of the agreement as to manifest an infidelity to the obligation of the arbitrator; or (3) evidences a manifest disregard for the agreement; or (4) does not represent a plausible interpretation of the agreement. For example, U.S. Department of the Air Force, Odgen Air Logistics Center, Hill Air Force Base and American Federation of Government Employees, Local 1592, 40 FLRA 1243, 1247 (1991) (Hill Air Force Base).

The Agency has not demonstrated that the award fails to draw its essence from the parties' agreement under any of the tests set forth above. The Arbitrator considered Article 69 of the parties' collective bargaining agreement and found that the Agency failed to comply with the negotiation requirements of this article in the implementation of the 24-hour work schedule. Therefore, the Arbitrator concluded that the Agency's implementation of the new work schedule violated Article 69 of the parties' agreement. We find that the Agency's contentions, including its contention concerning the Arbitrator's alleged lack of capacity to resolve the grievance as reflected by his "avoid[ance] [of] all of the factual issues[,]" constitute mere disagreement with the Arbitrator's interpretation of the parties' agreement and his findings of fact. Exceptions at 8. These contentions are nothing more than an attempt to relitigate the issues presented before the Arbitrator. Accordingly, we find such contentions provide no basis for finding the award deficient under section 7122(a) of the Statute. See, for example, American Federation of Government Employee, Local 51, AFL-CIO and United States Mint, Department of the Treasury, 41 FLRA 48, 51 (1991); Hill Air Force Base, 40 FLRA 1243 at 1246-47.

C. The Second Part of the Arbitrator's Award Is Deficient to the Extent that It Requires the Agency to Negotiate the Proper Pay Formula Including the Premium and Overtime Computations

As the second aspect of his award, the Arbitrator "advised that the Agency fully negotiate and successfully settle all applicable points of contention (i.e.-proper sleeping facilities; proper direction for record keeping requirements with regard to eat, and sleep time; proper pay formula including premium and overtime computations; et. al.) prior to the implementation." Award at 5. The Agency appears to contend that this aspect of the award is contrary to law to the extent that it requires the Agency to negotiate the proper pay formula including the premium and overtime computations. We find that this portion of the award is deficient because it directs the Agency to bargain over matters that are specifically provided for by law, 5 U.S.C. § 5545(c)(1), and, thus, are outside the duty to bargain under section 7103(a)(14)(C) of the Statute.

Under 5 U.S.C. § 5545(c)(1), an agency may pay premium pay up to 25 percent of employees' base pay on an annual basis, instead of overtime compensation for regularly scheduled work, to employees for regularly scheduled duty spent on standby status. FPM Letter 551-14 provides instructions to agencies for applying the FLSA to employees in receipt of annual premium pay for regularly scheduled standby duty under 5 U.S.C. § 5545(c)(1).

The grievance in this case concerns the Agency's implementation of a 24-hour tour of duty which requires standby duty. Consistent with OPM's decision, premium and overtime pay for the EMTs on a 24-hour/standby tour of duty is governed by 5 U.S.C. § 5545(c)(1). Because premium and overtime compensation for employees assigned to such a tour is specifically provided for by law, the portion of the award requiring the Agency to negotiate such pay does not concern conditions of employment under section 7103(a)(14)(C) of the Statute. See Fort Stewart Schools v. FLRA, 110 S. Ct. 2043, 2048 (1990) (matters pertaining to employee pay that are specifically provided for by Federal statute are excluded from the definition of conditions of employment under section 7103(a)(14)(C) of the Statute and are not subject to bargaining). Therefore, to the extent that the award directs the Agency to negotiate the proper pay formula, including premium and overtime computations, the award requires the Agency to negotiate over matters that are nonnegotiable under section 7103(a)(14)(C) of the Statute and, thus, the award is deficient under section 7122(a) of the Statute. See U.S. Department of Defense, Army and Air Force Exchange Service, George Air Force Base, California and National Federation of Federal Employees, Local 977, 41 FLRA 1413, 1417-18 (1991).

D. The Third Part of the Award, Which Directs Backpay, Is Deficient

The third part of the award directs the Agency to make employees whole. The Arbitrator directed that backpay be "computed on the formula in place prior to the [March 16, 1986] implementation of the invalid tour, and subsequent pay formula; i.e., the back pay will be in accordance with the pay formula in effect, with regard to base pay, premium pay, and overtime pay, for the [8-hour] tours prior to [March 16, 1986]." Award at 5. Both parties interpret this portion of the award as requiring that the affected employees be compensated for each 24-hour shift of scheduled duty on the basis of 8 hours of straight time and 16 hours of overtime computed at the rate of one and one-half times their hourly rate of basic pay.

The Agency contends that the Arbitrator's award "is contrary to Federal law and regulation with regard to pay of Federal employees." Exceptions at 1. Specifically, the Agency asserts that the third part of the award is contrary to 5 U.S.C. § 5545(c)(1), 5 C.F.R. § 550.141 and FPM Letter 551-14. The Agency contends that the award would result in an "illegal 'windfall' of overtime pay for employees who worked a 24-hour tour and who were compensated by premium pay and overtime pay in accordance with Federal statute and OPM regulation." Id. at 4. According to the Agency, it "has no choice but to pay the employees in accordance with 5 USC 5545(c)(1) and the FPM Letter, both for the current and the retroactive period. That is, the employees are to be paid premium and overtime pay, not just straight overtime pay as required by the arbitrator." Id.

We find that this part of the award is contrary to 5 U.S.C. § 5545(c)(1) and its implementing regulation, 5 C.F.R. § 550.141, and FPM Letter 551-14. Section 5545(c)(1) of title 5 permits agencies, with OPM approval, to pay employees on regularly scheduled tours of duty, which include regularly scheduled standby duty, premium pay up to 25 percent of those employees' base pay on an annual basis, in lieu of premium pay provided by other provisions of title 5 of the United States Code, including overtime compensation under 5 U.S.C. § 5542. In particular, we note that the

legislative history of 5 U.S.C. Sec. 5545(c)(1) shows that the annual premium pay provision was enacted for the express purpose of allowing additional annual pay in lieu of overtime, night, and holiday pay for General Schedule employees who are required to remain at or within the confines of their stations during longer than ordinary periods of duty, but who spend a substantial part of their time on duty in a standby status rather than actually performing work.

Comp. Gen. No. B-213931 (June 21, 1984) (unpublished) (Comp. Gen. No. B-213931). See S. Rep. No. 1992, 83d Cong., 2d Sess., reprinted in 1954 U.S. Code Cong. & Admin. News 3823-24 (Cong. & Admin. News).

We further note the views expressed by the Civil Service Commission (Commission), the predecessor of OPM, in the Commission's report to the Senate concerning amendments to the Federal Employees Pay Act of 1945. In that report the Commission commented on, among other things, the provision (now codified at 5 U.S.C. § 5545(c)(1)) that provided annual premium pay for employees on standby duty. The Commission noted that the types of Federal employment covered by this provision did not fit well within the standard overtime-pay provisions. The Commission stated that "[s]ome employees . . . are on duty for long periods but are in a standby status for much of their time on duty, at their stations ready to answer any calls but not performing actual work." Cong. & Admin. News at 3834. The Commission further stated that "[a]dditional compensation on an annual basis for [such] employees would be easy to administer, fair to the Government, and equitable for the employees covered." Id.

We conclude that 5 U.S.C. § 5545(c)(1) was intended to provide a form of premium pay, in lieu of overtime and other forms of premium pay, for general schedule employees whose regular tours of duty include standby duty during which they perform no work and for which they would not otherwise be entitled to overtime or other premium pay. The additional compensation of 25 percent of basic pay is the maximum an employee whose regular tour of duty includes standby duty can receive under 5 U.S.C. § 5545(c)(1), except for irregular or unscheduled overtime duty in excess of the employee's regular tour of duty. See Comp. Gen. No. B-213931. We note that bona fide meals and sleeping periods are excluded from the computation of hours of work for overtime pay. See FPM Letter 551-14. As such, general schedule employees covered by 5 U.S.C. § 5545(c)(1) who are on a 24-hour tour of duty (8 hours of regular duty and 16 hours of standby duty) may not receive 16 hours of overtime pay for standby duty that, as in this case, includes bona fide meals and sleeping periods.

More specifically, under 5 U.S.C. § 5545(c)(1) and its implementing regulations, employees entitled to annual premium pay because their work schedules, including standby duty, were approved for such pay under this provision, cannot be paid overtime or premium pay under 5 U.S.C. § 5542 or other premium pay provisions under chapter 55 of title 5 of the United States Code, unless the work is irregular or occasional duty performed outside the employees' regularly scheduled tour of duty. See 5 C.F.R. §§ 550.141 and 550.163. However, if an employee's entitlement to "time-and-a-half" overtime compensation, under 5 U.S.C. § 5542, for the hours of actual overtime work performed exceeds the amount of annual premium pay which would otherwise be payable for the performance of standby duties under 5 U.S.C. § 5545(c)(1) and 5 C.F.R. § 550.141, the employee is to be paid that overtime compensation rather than standby premium pay. See Comp. Gen. No. B-213931 and 5 C.F.R. § 550.142.

In sum, under 5 U.S.C. § 5542, employees are paid "time-and-a-half" overtime only for hours actually worked and, because time spent in standby status does not constitute hours of actual work, employees working under 5 U.S.C. § 5542 would not be paid for standby duty. The annual premium pay provided under 5 U.S.C. § 5545(c)(1) is intended to provide compensation for employees whose regular tours of duty include scheduled standby duty and who would not, under 5 U.S.C. § 5542, receive any pay for that standby duty. Moreover, employees entitled to annual premium pay under 5 U.S.C. § 5545(c)(1) are to be paid that pay only if it is more than the pay they would receive under 5 U.S.C. § 5542 for the hours of actual work customarily required in their positions, excluding standby time during which they perform no work, meal time, and sleeping time, but not if that pay would be less than the pay they would receive under 5 U.S.C. § 5542 for hours actually worked, including standby time during which they perform no work. In short, employees working under 5 U.S.C. § 5545(c)(1) are entitled to "time-and-a-half" overtime under 5 U.S.C. § 5542 if their pay for the hours actually worked, excluding standby time during which they perform no work, exceeds the amount of annual premium pay to which they would otherwise be entitled for standby duty under 5 U.S.C. § 5545(c)(1). See 5 C.F.R. § 550.142. Depending on the amount of time spent actually working under a schedule including standby duty, therefore, employees may earn more under 5 U.S.C. § 5545(c)(1) than they would otherwise be entitled to under 5 U.S.C. § 5542.

In this case, the record shows that the Agency sought and received OPM approval to pay annual premium pay to the affected employees in accordance with 5 U.S.C. § 5545(c)(1). The record further shows that on March 16, 1986, the affected employees began a regularly scheduled 24-hour/standby tour of duty and that the employees initially received annual premium and overtime pay pursuant to 5 U.S.C. § 5545(c)(1) and FPM Letter 551-5. The record also shows that OPM subsequently determined that the employees should be paid under FPM Letter 551-14 rather than under FPM Letter 551-5. Thus, for the work that they performed on a regularly scheduled 24-hour/standby tour, the employees were entitled to retroactive premium pay computed under FPM Letter 551-14 and to have their current pay based upon that letter.

Accordingly, after March 16, 1986, the affected employees were entitled to premium and overtime pay for work performed on the basis of their regularly scheduled 24-hour/standby tour under 5 U.S.C. § 5545(c)(1) and its implementing regulation, 5 C.F.R. § 550.141, and FPM Letter 551-14. The Arbitrator's award directs that backpay for these employees, as it relates to base pay, premium and overtime pay, be computed in accordance with the pay formula in effect for the 8-hour tours of duty prior to March 16, 1986. The employees in this case were assigned to a 24-hour tour of duty for which, under 5 U.S.C. § 5545(c)(1) and applicable OPM regulations, they were approved to receive premium pay on an annual basis for work that included regularly scheduled standby duty. Consequently, under 5 U.S.C. § 5545(c)(1), they are precluded from receiving overtime pay and premium pay for the same hours under other provisions of title 5 of the United States Code. Accordingly, we conclude that the Arbitrator's award, which effectively requires overtime and premium pay under other provisions of title 5 of the United States Code for hours worked under 5 U.S.C. § 5545(c)(1), is deficient as contrary to law and regulation.

In so concluding, we note that the Arbitrator could have appropriately ordered, if circumstances warranted, backpay on a different basis as part of his award ordering a status quo ante remedy. That is, if the Arbitrator had determined that the employees had suffered a loss as a result of the change in shifts and hours, the Arbitrator could have ordered that the employees be paid the difference between the amount they were due and received under 5 U.S.C. § 5545(c)(1) and the amount they would have been entitled to under the appropriate overtime provision, 5 U.S.C. § 5542. As the Arbitrator did not make such a determination, we do not address this basis for ordering backpay.

We also note the Agency's acknowledgment that it is obligated to pay the EMTs, based upon OPM's determination, in accordance with 5 U.S.C. § 5545(c)(1) and FPM Letter 551-14 "both for the current and retroactive period." Exceptions at 4. This period of time began with the implementation of the 24-hour schedule on March 16, 1986, when affected employees were improperly paid under FPM Letter 551-5. In view of the Agency's acknowledgment and OPM's determination, we encourage the Agency to promptly pay, if it has not already done so, all affected EMTs for any amounts owed them for the period beginning with the implementation of the 24-hour shift on March 16, 1986, in accordance with 5 U.S.C. § 5545(c)(1) as implemented by 5 C.F.R. § 550.141 and FPM Letter 551-14.

VI. Decision

The award is modified by striking those portions which direct the Agency to negotiate the proper pay formula, including premium and overtime computations, and to pay backpay. The Agency's remaining exceptions are denied.

APPENDIX

5 U.S.C. § 5545 provides, in relevant part, as follows:

§ 5545. Night, standby, irregular, and hazardous duty differential

(c) The head of an agency, with the approval of the Office of Personnel Management, may provide that--

(1) an employee in a position requiring him regularly to remain at, or within the confines of, his station during longer than ordinary periods of duty, a substantial part of which consists of remaining in a standby status rather than performing work, shall receive premium pay for this duty on an annual basis instead of premium pay provided by other provisions of this subchapter, except for irregular, unscheduled overtime duty in excess of his regularly scheduled weekly tour. Premium pay under this paragraph is determined as an appropriate percentage, not in excess of 25 percent, of such part of the rate of basic pay for the position as does not exceed the minimum rate of basic pay for GS-10 (including any applicable locality-based comparability payment under section 5304 or similar provision of law and any applicable special rate of pay under section 5305 or similar provision of law), (or, for a position described in section 5542(a)(3) of this title, of the basic pay of the position), by taking into consideration the number of hours of actual work required in the position, the number of hours required in a standby status at or within the confines of the station, the extent to which the duties of the position are made more onerous by night, Sunday, or holiday work, or by being extended over periods of more than 40 hours a week and other relevant factors[.]

5 C.F.R. § 550.141 provides as follows:

§ 550.141 Authorization of premium pay on an annual basis.

An agency may pay premium pay on an annual basis, instead of the premium pay prescribed in this subpart for regularly scheduled overtime, night, holiday, and Sunday work, to an employee in a position requiring him or her regularly to remain at, or within the confines of, his or her station during longer than ordinary periods of duty, a substantial part of which consists of remaining in a standby status rather than performing work. Premium pay under this section is determined as an appropriate percentage, not in excess of 25 percent, of that part of the employee's rate of basic pay which does not exceed the minimum rate of basic pay for GS-10 (including any applicable interim geographic adjustment under section 302 of the Federal Employees Pay Comparability Act of 1990 (Pub. L. 101-509) or locality-based comparability payment under 5 U.S.C. 5304 and any applicable special rate of pay under 5 U.S.C. 5305 or similar provision of law).

56 Fed. Reg. 20,342 (1991).




FOOTNOTES:
(If blank, the decision does not have footnotes.)
 

1. Article 69, Section 1 of the parties' agreement provides:

[P]rior to the implementation of any exercise of the employer's authority not specifically covered under this agreement, the employer shall provide the union with a written proposal at least 15 working days prior to the proposed implementation date.

Award at 3-4 (emphasis in award).

2. The record does not contain the text of Article 69, Section 2 b. of the parties' agreement.

3. Although the record does not include the enclosure noted in the letter of February 19, 1986, it is clear from other materials in the record that the pay computation formula mentioned in the Agency's letter related to compensation of employees under section 7(k) of the FLSA. Under section 7(a) of the FLSA, 29 U.S.C. § 207(a), employees are entitled to receive overtime compensation for all hours worked in excess of 40 hours in a workweek at a rate of one and one-half times their regular rate. Section 7(k) of the FLSA provides an exception to section 7(a) for public agency employees engaged in fire protection services. Under section 7(k), a Federa