U.S. Department of Defense, Education Activity, Arlington, Virginia (Agency) and Federal Education Association (Union)
[ v56 p901 ]
56 FLRA No. 150
U.S. DEPARTMENT OF DEFENSE
FEDERAL EDUCATION ASSOCIATION
September 29, 2000
Before the Authority: Donald S. Wasserman, Chairman and Dale Cabaniss, Member.
I. Statement of the Case
This matter is before the Authority on exceptions to an award of Arbitrator Mary Bass 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 Regulations. The Union filed an opposition to the Agency's exceptions.
The Arbitrator determined that the Agency had committed an unjustified or unwarranted personnel action in this matter when it failed to pay the grievant her living quarters allowance (LQA) in a timely manner. As such, the Arbitrator awarded the grievant interest pursuant to the Back Pay Act on this unpaid amount. For the reasons that follow, we find that the Agency has failed to show that the Award is deficient under section 7122(a) of the Statute. Therefore, we deny the exceptions.
II. Background and Arbitrator's Award
In July 1997, the grievant submitted an application for LQA with supporting documentation to the secretary at the school where she worked. The LQA application was forwarded to Washington, but it was either never delivered or was lost sometime after receipt. The grievant made several inquiries as to the status of her LQA application starting in July 1997, until the Agency notified her in January 1998 that the application could not be found. At that time the Agency also instructed the grievant to again submit the application. [ v56 p902 ]
The grievant filed her grievance on this matter in February 1998. However, the grievant was initially unable to supply copies of the supporting documentation that were originally included in the initial application, and in June 1998 submitted her second LQA application. The grievant was subsequently paid for her past LQA on December 31, 1998, on February 11, 1999, and on June 3, 1999. The Agency did not pay the grievant any interest.
B. Arbitrator's Award
The Arbitrator framed the issues as follows:
Were the Grievant's Living Quarters Allowance ("LQA") reconciliations processed and paid in a timely manner? If not what shall the remedy be?
Did the delay in processing/payment, if any, constitute an unjustified or unwarranted personnel action? If so, does the delay in payment require interest? If so, when does the interest begin to accrue?
Award at 1-2.
The Arbitrator found that the grievant's LQA was not processed and paid in a timely manner. Specifically, the Arbitrator determined that the Agency was responsible for losing the original LQA application submitted in July of 1997. While the Arbitrator determined that the grievant was negligent for not having made copies of her original submission during the delay from January, 1998, until her submission of the second LQA application in June of 1998, she found once again that the remaining delay in payment was the fault of the Agency. Award at 8.
The Arbitrator noted that the main contention stemmed from the grievant's claim that interest should have been paid for her delayed LQA reimbursement. In addressing this issue the Arbitrator found that the Agency had committed an unjustified or unwarranted personnel action under the Back Pay Act when it failed to timely pay the grievant under both statutory and contractual obligations. The Arbitrator determined that Article 47, section 7, requires the payment of LQA at the "first pay day occurring thirty days after submission of documentation to the point of contact is a reasonable time for payment of LQA under Article 47 § 7 of the Agreement." Id. at 10. In coming to this conclusion, the Arbitrator referred to two previous arbitration decisions involving these parties and the same timeliness issues, where the arbitrators had found a policy and practice between the parties that payment was required on the first pay day 30 days after an LQA application submission. [n1] Id. The Arbitrator further found that 20 U.S.C. § 905 also requires the payment of LQA. [n2] Id. at 11.
The Arbitrator rejected the Agency's argument that OPM regulations are inconsistent with the Back Pay Act, and determined that, based on the Agency's violation of the parties' agreement and 20 U.S.C. § 905, it need not consider the Agency's argument that delay in payment is not a per se unjustified or unwarranted personnel action. Id.
The Arbitrator ultimately found that the Agency was liable to pay the grievant any additional LQA principle it owed her above the amount already paid the grievant. With respect to interest, the Arbitrator noted that interest was payable for any LQA not paid the grievant within 30 days of that money becoming due. The Arbitrator also noted that the Agency was not responsible for interest payments between January 1998 and June 1998 as the Agency's delay in payment could not be considered an unjustified or unwarranted personnel action because of the grievant's delay in submitting her second LQA application. Id.
III. Positions of the Parties
A. Agency's Exceptions
1. OPM Regulations
The Agency maintains that OPM regulations defining an unjustified or unwarranted personnel action should be "approached with skepticism." Exceptions at 22-23, citing Department of Justice, Office of General Counsel, opinion dated May 31, 1994. Specifically, the Agency asserts that the definition of an unjustified or unwarranted personnel action promulgated in OPM's regulations at 5 C.F.R. § 550.803 would allow every pay action standing alone to form the basis of an unjustified or unwarranted personnel action. [n3] Accordingly, it argues, "[t]here is no justification within the statute [Back Pay Act] for including every pay action or every [ v56 p903 ] procedural error as an independent basis for a UUPA [unjustified or unwarranted personnel action]." Exceptions at 21.
2. Contrary to Law
The Agency asserts that the Arbitrator improperly found that it had committed an unjustified or unwarranted personnel action. Exceptions at 4-5, citing United States v. Testan, 424 U.S. 392, 405 (1976) (Testan). The Agency contends that it made no finding that the grievant was ineligible for or denied LQA (i.e., that it took an adverse action against the grievant), rather an administrative delay held up the grievant's payment. [n4] As such, the Agency argues that the award is deficient because it had never denied its obligation to pay the grievant LQA due her, and Congress has not explicitly waived sovereign immunity where an agency takes no adverse personnel action against an employee under the Back Pay Act. Exceptions at 4, 9 and 20.
The Agency further argues that the Back Pay Act is generally limited in scope to "those very few circumstances" where the omission of a personnel action is based on a mandatory action such as where an Agency violates a "specific" law, rule, regulation or collective bargaining agreement. Exceptions at 11-12, 14, 24-25. Accordingly, it argues that merely finding a general duty to pay is not equivalent to a mandatory duty to pay and, as such, the Arbitrator failed to show how the parties' agreement, OPM regulation, the Back Pay Act and previous arbitration rulings taken together would create such a duty. Id. at 19. It further asserts that under the facts in this matter, there is no evidence supporting a conclusion that it took the last discretionary personnel action prior to the LQA payment becoming mandatory. Exceptions at 24.
Moreover, the Agency contends that the grievant in this matter experienced no more than "administrative delay" in receiving some of her LQA. Exceptions at 5-6. It asserts that the mere delay in payment is not the kind of personnel action contemplated by the Back Pay Act. Id. As such it generally argues that pay delays, per se, are not a violation of the Back Pay Act.
The Agency also argues that Arbitrator Bass erred by relying on several previous decisions issued by other arbitrators involving these parties and issues. Specifically, the Agency argues that those decisions do not bind it to change its interpretation of the parties' collective bargaining agreement and are not, therefore, "stare decisis." Id. at 20-21. [n5]
3. The Award Fails to Draw Its Essence from the Parties' Collective Bargaining Procedure
We construe from the Agency's exceptions that it also contends that the Arbitrator's award fails to draw its essence from the parties' collective bargaining agreement. The Agency notes that nowhere in the parties' agreement is there a provision which sets a specific date for payment of the LQA despite the Arbitrator relying on a portion of that agreement, Article 47, in deciding that interest was owed under the Back Pay Act. Exceptions at 18 n.6, 25.
4. The Award is Based on Nonfact.
The Agency challenges the award on the basis that there was a lack of evidence of any personnel action that was taken, and a lack of any evidence regarding whether the pay action had become ministerial or nondiscretionary. Exceptions at 20.
B. Union's Opposition
The Union states that the Agency's exception is merely an attempt to avoid paying interest on a Back Pay Act award for as long as possible. According to the Union, the exception amounts to a "mere disagreement" with the clear meaning of and "Arbitrator Bass' studied interpretation and application of the Back Pay Act." Opposition at 4. The Union asserts that this disagreement does not constitute a basis for reviewing the award and that the exception is nothing but an effort to relitigate [ v56 p904 ] the issue one more time. As such, the Union contends, the exception should be summarily dismissed.
The Union contends that the Agency applied several decisions, including Testan and other judicial and Comptroller General precedent, incorrectly and that those decisions actually support the Arbitrator's decision. Opposition at 7. The Union argues that these decisions clearly show that backpay, under the Back Pay Act, is warranted where an agency fails to pay employees in accordance with a mandatory or nondiscretionary pay statute. It argues that in this matter there was no discretion to not pay LQA under the applicable pay statute. Id. at 8.
Moreover, the Union contends that to the extent that the Agency is arguing that DFAS is outside the control of the Agency and, therefore, the Agency should not be liable for its mistakes, such argument is incorrect because it took the Agency over two years to send the corrective paperwork to DFAS. Id. at 6.
Finally, in response to the Agency's argument regarding discretionary actions, the Union states that certifying principle which is clearly due in accordance with the parties' agreement and the Defense Department Overseas Teachers Pay and Personnel Practices Act involves no discretion or exercise of judgment. Id. It argues that to the extent the Agency is asserting that it never took the "`last discretionary act'" of having its pay agent approve payment, such action is not discretionary under the pay statute in this matter. Id. at 2.
IV. Analysis and Conclusions
A. Office of Personnel Management Regulations Implementing the Back Pay Act May Not Be Challenged in this Proceeding
The Agency's arguments regarding the OPM regulations implementing the Back Pay Act, set forth at 5 C.F.R. Part 550, in effect ask the Authority to review and construe this OPM regulation to find that a pay action is an inadequate basis to constitute an unjustified or unwarranted personnel action.
Section 7105 of the Statute enumerates the powers and duties of the Authority, none of which relate to passing judgment on rules or regulations that OPM or any other Federal agency has enacted. See 5 U.S.C. § 7105; American Federation of Government Employees, AFL-CIO v. FLRA, 794 F.2d 1013, 1015 (5th Cir. 1986) (Congress did not intend for the Authority to sit in review of other agencies' regulations). If the Agency wishes to challenge the validity of the OPM regulations implementing the Back Pay Act, the Authority is not the correct forum. See U.S. Department of Defense, Dependents Schools, Bulzbach Elementary School, Bulzbach, Germany and Federal Education Association, 56 FLRA 208, 212 (2000) (Bulzbach Elementary School). If the validity of these OPM regulations is in question, the issue must be raised by an interested party in another forum. Therefore, we deny the exception.
B. The Award Is Not Contrary to Law, Regulation or Sovereign Immunity
When a party's exception challenges an arbitration award's consistency with law, rule, or regulation, the Authority reviews the questions of law raised in the exception and the arbitrator's award de novo. See National Federation of Federal Employees, Local 1437 and U.S. Department of the Army, Army Research, Development and Engineering Center, 53 FLRA 1703, 1709 (1998). When applying a de novo standard of review, the Authority assesses whether an arbitrator's legal conclusions are consistent with the applicable standard of law, based on the underlying factual findings. Id. at 1710. In making that assessment, the Authority defers to the arbitrator's factual findings. See National Treasury Employees Union, Chapter 50 and U.S. Department of the Treasury, Internal Revenue Service, Carolina District, Charlotte, North Carolina, 54 FLRA 250, 253 (1998).
Under the Back Pay Act, 5 U.S.C. § 5596(b)(1)(A)(i), an award of backpay is authorized only when an arbitrator finds that: (1) the aggrieved employee was affected by an unjustified or unwarranted personnel action; and (2) the personnel action resulted in the withdrawal or reduction of the employee's pay, allowances or differentials. See U.S. Department of Health and Human Services and National Treasury Employees Union, 54 FLRA 1210, 1218 (1998). A violation of a collective bargaining agreement constitutes an unjustified or unwarranted personnel action under the Back Pay Act. See, U.S. Department of Defense, Department of Defense Dependents Schools and Federal Education Association, 54 FLRA 773, 785 (1998).
Here, not only did Arbitrator Bass determine that the Agency violated 20 U.S.C. § 905, but she found that the Agency violated the grievant's contractual right to receive timely payment for the sums owed the grievant. As noted above, this is a sufficient basis on which to determine that an unjustified or unwarranted personnel action occurred. Id.
The Agency's Back Pay Act arguments in this case are encompassed by the Back Pay Act arguments made by it in DODEA, Arlington. Here, as there, three interrelated [ v56 p905 ] and overlapping arguments are being made: (1) the Back Pay Act does not come into play where the obligation to pay the underlying amount is not in question; (2) delay or omission does not fall under the Back Pay Act unless there is some law, rule or regulation that makes the payment nondiscretionary and by a specific date; and (3) omission or mere delay is not per se an unjustified or unwarranted personnel action. Moreover, the Agency also argues that to the extent that DFAS was at fault, the Agency should not be liable and that the Arbitrator improperly relied on past arbitrable decisions.
In the present matter, we have examined the Agency's Back Pay Act arguments, the legal precedent cited in support thereof, and the underlying arbitral record. We conclude, for the same reasons set forth in DODEA, Arlington, that the Agency has not shown that Arbitrator's award in this case is contrary to the Back Pay Act.
As noted in DODEA, Arlington, the administrative error rule specifically recognizes error or delay in making payment as unjustified or unwarranted personnel action under the Back Pay Act, even where the obligation to pay is not in question, or there is no nondiscretionary law, rule, or regulation mandating action in accordance with specific criteria or by a specific date. Also, as in DODEA, Arlington, there is no arbitral finding in the present case that omission or delay is, per se, an unjustified or unwarranted personnel action. Rather, the Arbitrator made her finding of an unjustified or unwarranted personnel action based upon a violation of a contractual obligation to make the required payments to the employee in a timely manner. The Authority has found the violation of such a contractual obligation to constitute an unjustified or unwarranted personnel action. See Bulzbach Elementary School, 56 FLRA at 212.
We have reviewed the other judicial precedent relied on by the Agency and find those decisions unpersuasive. [n6] As discussed above, the Arbitrator found that the Agency's failure to timely pay the grievant her LQA under Article 47 of the parties' agreement constituted an unjustified or unwarranted personnel action and that backpay (if any was still outstanding) and interest were due the employee. The award of backpay with interest is based on the violation of contractual and statutory obligations, rather than on the Back Pay Act itself. Accordingly, the Agency's reliance on the other cited cases is misplaced.
Moreover, the Agency may be asserting that it has no control over the actions of DFAS and, implicitly, DFAS shares in liability or is solely liable for any payment. Exceptions at 24. This argument, however, is supported by no cited authority and is cursory at best. The Agency even acknowledges that it, not DFAS, has either "repaid the amounts [of LQA owed] or will repay the amounts." Exceptions at 4. Therefore, this argument is dismissed as a bare assertion. See, e.g., National Association of Government Employees, Local R4-45 and U.S. Department of Defense, Defense Commissary Agency, Fort Lee, Virginia, 55 FLRA 784, 787 (1999).
Turning to another Agency argument, to the extent it argues that Arbitrator Bass erred in relying upon the reasoning in several previous decisions issued by other arbitrators involving these parties and issues, we find that the Arbitrator merely referred to the reasoning and facts found in those decisions. The record does not indicate that Arbitrator Bass found that she was bound by those decisions in rendering her conclusions in this matter. Therefore, this argument is also unpersuasive.
Accordingly, we find that the Arbitrator's award is not contrary to law and deny the Agency's exception.
C. The Award Does Not Fail to Draw Its Essence from the Parties' Agreement
In order for an award to be found deficient as failing to draw its essence from the collective bargaining agreement, it must be established that the award: (1) cannot in any way be derived from the agreement; (2) is so unfounded in reason and fact and so unconnected with the wording and purposes of the collective bargaining agreement as to "manifest an infidelity to the obligation of the arbitrator"; (3) does not represent a plausible interpretation of the agreement; or (4) evidences a manifest disregard of the agreement. See United States Department of Labor (OSHA) and National Council of Field Labor Locals, 34 FLRA 573, 575 (1990).
The Agency argues that Article 47 merely establishes "a general duty to ensure that housing is provided in kind or allowance," but does not require payment on a set date. Exceptions at 18, n.6. However, this argument [ v56 p906 ] does not establish that the award fails to draw its essence from the collective bargaining agreement under any of the tests recognized by the Authority. The Arbitrator clearly explains that in her interpretation of Article 47 a reasonable time frame for payment of LQA was warranted because it was silent as to a specific time frame. The Agency does not demonstrate how the Arbitrator's interpretation mandating payment of an entitlement within a reasonable time frame fails under the above test. Accordingly, we find that the Agency has not demonstrated that the award fails to draw its essence from the parties' agreement and we deny the exception.
D. The Award is Not Based on a Nonfact
To establish that an award is based on a nonfact, the appealing party must demonstrate that a central fact underlying the award is clearly erroneous, but for which a different result would have been reached by the arbitrator. See, e.g., U.S. Department of the Air Force, Lowry Air Force Base, Denver, Colorado and National Federation of Federal Employees, Local 1497, 48 FLRA 589, 593 (1993); General Services Administration, Region 2 and American Federation of Government Employees, Local 2431, 46 FLRA 1039, 1046-47 (1992). However, this basis for finding an arbitration award deficient does not permit the appealing party to dispute an arbitrator's findings of fact.
Moreover, an arbitrator's legal conclusions cannot be challenged on the grounds of nonfact. See, e.g., National Federation of Federal Employees, Local 561 and U.S. Department of the Army, U.S. Army Corps of Engineers, Mobile, Alabama, 52 FLRA 207, 210-11 (1996); U.S. Department of the Navy, Philadelphia Naval Shipyard and Philadelphia Metal Trades Council, 39 FLRA 590, 605 (1991). Arbitrator Bass made the determination that the Agency owed interest on the monies owed the employee under the grievance. The Agency's exception is not based on nonfact, but rather on the legal conclusions reached by the Arbitrator concerning the applicability of the Back Pay Act and its authorization for the payment of interest. As such, the exception provides no basis to overturn the award and we deny the exception.
The Agency's exceptions are denied.
Footnote # 1 for 56 FLRA No. 150
These were the awards of Hockenberry and Popular, which are discussed in more detail in U.S. Department of Defense, Education Activity, Arlington, Virginia and Federal Education Association, 56 FLRA No. 119 (September 26, 2000) (DODEA, Arlington).
Footnote # 2 for 56 FLRA No. 150
Under regulations which shall be prescribed by or under authority of the President, each teacher (other than a teacher employed in a substitute capacity) shall be entitled, in addition to basic compensation, to quarters, quarters allowance, and storage as provided by this section.
Footnote # 3 for 56 FLRA No. 150
an act of commission or an act of omission (i.e., failure to take an action or confer a benefit) that an appropriate authority subsequently determines, on the basis of substantive or procedural defects, to have been unjustified or unwarranted under applicable law, Executive order, rule, regulation, or mandatory personnel policy established by an agency or through a collective bargaining agreement. Such actions include personnel actions and pay actions (alone or in combination).
Footnote # 4 for 56 FLRA No. 150
The Agency states that the DFAS "operates as paymaster" and thus actually made this payment. Exceptions at 23-24. It states that,"[o]ne agency cannot determine that the actions of a separately regulated entity are nondiscretionary and mandatory merely because the pay entity is an agent of the employing activity." Id. To some extent, therefore, it appears to argue that DFAS is ultimately liable for any additional payment.
Footnote # 5 for 56 FLRA No. 150
The Agency also claims that the Arbitrator "exceeded her authority under the FLSA, and violated the scope of the [Back Pay Act]." Exceptions at 26. As the Agency did not explain what FLSA means, we construe this contention also as a claim that the Arbitrator exceeded the scope of her authority under the Back Pay Act, and that this merely rephrases the Agency's claim that the award is contrary to law, rather than setting forth a separate exception.
Footnote # 6 for 56 FLRA No. 150
Abramson v. U.S., 42 Fed. Cl. 621 (1998) (addressed whether claim under Fair Labor Standards Act was required to be processed through negotiated grievance procedure instead of raising claim before the court); Brown v. Secretary of the Army, 918 F.2d 214 (D.C. Cir. 1990) (Back Pay Act waiver of sovereign immunity did not authorize prejudgment interest on backpay awards to federal employees denied promotions on basis of discrimination, where there was no proof that employees would have been selected for promotion); Hambsch v. U.S., 857 F.2d 763 (Fed. Cir. 1988) (Claims Court did not have subject matter jurisdiction over employee's claim regarding sick leave); Spagnola