United States, Department of Defense, Education Activity, Arlington, Virginia (Agency) and Federal Education Association (Union)
[ v59 p806 ]
59 FLRA No. 146
DEPARTMENT OF DEFENSE
FEDERAL EDUCATION ASSOCIATION
April 7, 2004
Before the Authority: Dale Cabaniss, Chairman, and
Carol Waller Pope and Tony Armendariz, Members
I. Statement of the Case
This matter is before the Authority on exceptions to an award of Arbitrator Andree Y. McKissick filed by the Agency under § 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 found that the grievance was arbitrable. The Arbitrator also found that the Agency violated the Debt Collection Act (DCA) and Article 45 of the parties' agreement in recouping overpayments of certain employee benefits. [n1] As a remedy, the Arbitrator ordered a stay of the Agency's collection actions against the grievants, and she awarded the grievants backpay with interest. For the following reasons, we conclude that the award is not deficient and deny the Agency's exceptions.
II. Background and Arbitrator's Award
The Union filed an association grievance on behalf of several employees claiming that the Agency violated the DCA and Article 45 of the parties' agreement by failing to pay certain employee benefits and by improperly garnishing the employees' wages. [n2] When the grievance was not resolved, the matter was submitted to arbitration. The parties could not agree to a stipulated issue, and the Arbitrator framed the issue as: "whether or not the due process safeguards of the Agreement and DCA were applied prior to the garnishment of wages of the [g]rievants and the applicability of resulting remedies, including the [Back Pay Act]?" Award at 7.
Initially, the Arbitrator found that the grievance was arbitrable. The Arbitrator stated that the grievance was an association grievance, which involved similarly situated employees with ongoing pay problems. Id. at 17. The Arbitrator further found that the parties had agreed, in a 1999 Memorandum of Understanding (hereinafter, the 1999 MOU), that the grievances would be consolidated, consistent with the parties' past practice, because of "the complexity of these types of disputes." Id. at 16. In addition, the Arbitrator relied on Article 12, § (7)(A) of the parties' agreement, which permits a "group grievance" to be filed "based upon the commonality of identical issues . . . ." Id. at 17. Finally, the Arbitrator rejected the Agency's claim that the grievance was not arbitrable because certain individual grievances were untimely filed. Citing Article 12, § (7)(B) of the parties' agreement, the Arbitrator found that the ongoing pay problems at issue here can be filed at any time. See id.
Turning to the merits, the Arbitrator found that under Article 2, § (2)(A) of the parties' agreement, the Agency was required to follow the requirements of the DCA, including the procedures of that statute, which are incorporated in Article 45 of the parties' agreement. With respect to each grievant, the Arbitrator found that "the Agency failed to make payments" of back pay and other benefits. Id. at 18. According to the Arbitrator, "many procedural safeguards were repeatedly omitted" in collecting overpayments. Id. In particular, the Arbitrator found that there was no "prehearing discovery to determine the accuracy" of the debts, no "oral hearing[s] at the overseas work site[s,]" and no "stay . . . of collection proceedings" as requested, pursuant to applicable procedures. Id. Instead, according to the Arbitrator, the [ v59 p807 ] Agency collected the debts from the grievants "upon the presentation of debt letters reflecting invalid debts." Id. Based on the foregoing, the Arbitrator concluded that the Agency violated the DCA and Article 45 of the parties' agreement.
The Arbitrator next determined that the Agency's violations in this regard constitute an unwarranted or unjustified personnel action, which resulted in a loss of pay to the grievants, within the meaning of the Back Pay Act. See id. at 19. Based on the foregoing, the Arbitrator sustained the grievance as to each grievant and ordered a stay of the Agency's collection actions against the grievants. The Arbitrator further ordered the Agency to conduct a full audit of its pay system to determine the amount of backpay owed to the grievants. The Arbitrator retained jurisdiction to resolve any disputes over implementation of the award and to entertain a motion for attorney fees.
III. Positions of the Parties
A. Agency's Exceptions
The Agency excepts to the award on grounds that: (1) the award fails to draw its essence from the parties' agreement; (2) the award is based on non-facts; and (3) the award is contrary to law.
The Agency makes two claims that the award fails to draw its essence from the parties' agreement. First, the Agency argues that the Arbitrator's determination that the grievance was arbitrable conflicts with Article 12, § (6)(A) and (B) of the parties' agreement, which sets forth the deadline for invoking arbitration under the parties' agreement. [n3] See Exceptions at 6. Second, the Agency asserts that the award fails to draw its essence from the parties' agreement because the Arbitrator incorrectly concluded that the grievance was properly consolidated under Article 12, § (6)(D) of the parties' agreement and mischaracterized "the individual grievances as group grievances" within the meaning of Article 12, § (7)(A) of the parties' agreement. [n4] Id. at 5.
Next, the Agency argues that the award is based on two nonfacts. In this regard, the Agency asserts that the Arbitrator's finding that "the consolidation was agreed upon" by the parties in a memorandum of understanding is a non-fact. Id. at 12. The Agency also asserts that the Arbitrator's characterization of the "individual grievances" as "group grievances" is a nonfact. Id.
Next, the Agency claims that the Arbitrator resolved an issue that was precluded from resolution "[b]ased on the doctrine of res judicata[.]" Id. In this connection, the Agency asserts that "the [A]rbitrator was precluded from ruling on the issue of whether the Agency was required to use the pre-collection hearing proceedings of Section 5 of the DCA . . . and Article 45 of the [parties' a]greement[.]" Id. at 13. According to the Agency, that issue was resolved in United States Dep't of Defense, Dependents Schools, 53 FLRA 196 (1997), where "the Authority ruled that the Agency was not required to use the pre-collection hearings procedures of the DCA in certain circumstances[,]" including those in this case. Exceptions at 13.
Finally, the Agency asserts that the Arbitrator erred in finding that "the Agency violated the Debt Collection Act and Article 45 of the Agreement when [certain] grievants weren't granted hearings for debts involving advances in pay." Id. at 3. Specifically, the Agency claims that it acted properly in not affording grievants Purdin and Weiland a hearing because those grievants did not file timely requests for a hearing. See id. at 24-27. Therefore, the Agency claims the Arbitrator erred in finding a violation of the DCA with respect to these grievants.
B. Union's Opposition
The Union argues that the Arbitrator correctly determined that the grievance was timely filed. The Union asserts that the award does not fail to draw its essence from the parties' agreement because the Arbitrator correctly found that it was the parties' past practice to consolidate grievances such as this one, and according to the Union, the Agency does not dispute this arbitral finding. See Opposition at 8-9. [ v59 p808 ]
Next, as to the Agency's non-fact exception, the Union asserts that, even though the Arbitrator referred to a "[g]roup [g]rievance," further findings show the Arbitrator's clear understanding that the grievance was actually an association grievance. Id. at 9. According to the Union, the Agency does not dispute the Arbitrator's finding that the grievance was an association grievance. See id. at 11. Therefore, the Union argues that the Arbitrator's reference to a "group grievance" is "superfluous, harmless error[.]" Id. at 18. Finally, according to the Union, the award does not conflict with the doctrine of res judicata or the DCA because the Arbitrator found that the debts were invalid. In this connection, the Union asserts that when a "debt is invalid, the procedures an agency followed in collecting a debt are irrelevant." Id. at 19.
IV. Preliminary Issue
Under § 2429.5 of the Authority's Regulations, the Authority will not consider issues that could have been, but were not, presented to the arbitrator. The Agency argues that the doctrine of res judicata precludes the Arbitrator from ruling on the issue of whether the Agency was required to use the pre-collection hearing proceedings of Section 5 of the DCA and Article 45 of the parties' agreement for advances of pay. See Exceptions at 13. However, the record shows that the Agency did not argue to the Arbitrator that questions regarding the applicability of the DCA and Article 45 of the parties' agreement were barred by res judicata. See Agency's Post Hearing Brief, Attachment 4 at 7-10. To the contrary, the record shows that the issue presented to the Arbitrator by the Agency was "[d]id the Agency violate the collective bargaining agreement . . . by failing to comply with the Debt Collection Act?" Award at 8. As the Agency's res judicata claim was not raised below, we will not consider it here.
The Agency also argues that, with respect to two particular grievants, the Arbitrator erred by finding violations of the DCA for failing to give these grievants hearings. According to the Agency, it did not give these grievants a hearing because one of them did not request a hearing while the other grievant's request for a hearing was not timely. There is no indication in the record before us that the Agency claimed before the Arbitrator that these two grievants did not submit timely hearing requests. Thus, we will not consider that argument here.
V. Analysis and Conclusions
A. The Arbitrator's Determination that the Grievance Was Timely Is Not Deficient
An arbitrator's determination regarding the timeliness of a grievance constitutes a procedural arbitrability determination, which may be found deficient only on grounds that do not challenge the determination itself. See United States Dep't of Defense, DLA, Def. Distrib. Depot, New Cumberland, Pa., 58 FLRA 750, 753 (2003). Such grounds include arbitrator bias or the fact that the arbitrator exceeded his or her authority. See AFGE, Local 2921, 50 FLRA 184, 185-86 (1995).
All of the Agency's essence arguments -- that the Arbitrator erred in finding that the grievance was timely, that she erred in finding that the grievance was properly consolidated, and that she erred in finding that the grievance constituted a group grievance -- challenge the Arbitrator's determination that the grievance was timely filed and, therefore, arbitrable. As such, the Agency's essence arguments challenge the Arbitrator's arbitrability determination itself, which does not provide a basis for finding the award deficient. See, e.g., United States Dep't of Defense, Dependents Schools, 55 FLRA 1108, 1110 (1999) (denying essence exceptions challenging arbitrator's timeliness determination and finding that grievance was a group grievance). Therefore, we deny the Agency's exception.
B. The Award Is Not Based On Nonfacts
To establish that an award is based on a nonfact, the appealing party must show that a central fact underlying the award is clearly erroneous, but for which the arbitrator would have reached a different result. See NFFE, Local 1984, 56 FLRA 38, 41 (2000). The Authority will not find an award deficient on the basis of an arbitrator's determination of any factual matter that the parties disputed at arbitration. See id. In addition, an arbitrator's conclusion that is based on an interpretation of the parties' collective bargaining agreement does not constitute a fact that can be challenged as a nonfact. See NLRB, 50 FLRA 88, 92 (1995).
The Agency argues that the award is based on nonfacts because the Arbitrator incorrectly found that the parties mutually agreed to consolidate the grievances and because he mischaracterized the individual grievances as group grievances within the meaning of the parties' agreement. However, the status and proper characterization of the grievance were issues that the parties disputed below, and the Agency's disagreement with the Arbitrator's resolution of those issues provides no basis for concluding that the award is based on nonfacts. Accordingly, we deny the Agency's exception.
The Agency's exceptions are denied. [ v59 p809 ]
ARTICLE 45 -DEBT COLLECTION ACT PROCEDURES
Unit employees shall be entitled to an oral hearing, which shall include the right to present evidence, including witnesses and documents. Further, unit employees shall have the right of reasonable pre-hearing discovery and the opportunity to question material government witnesses concerning their calculations and conclusions of indebtedness.
The timely filing of a petition for hearing shall stay the commencement of collection proceedings pending decision of the hearing officer.
All hearings held pursuant to the Debt Collection Act will take place at the overseas work site.
The unit employee may exercise whatever rights to review a decision of the hearing officer he or she may have under law. If the unit employee elects to grieve the decision of the hearing officer, such grievance must be filed at the regional level by the affected unit employee within fifteen (15) school days after receipt of the hearing officer's decision. The unit employee shall be authorized interest on all monies improperly withheld as provided for by law.
In the event the Agency violates the Debt Collection Act or the provisions of this Article, a grievance may immediately be filed. 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.
ARTICLE 2 -CONDITIONS OF THE AGREEMENT
Section 2.-Relationship to Laws and Government-Wide Regulations.
A. In the administration of all matters covered by this Agreement, the parties shall be governed by laws and Government-wide regulations in effect on September 18, 1989.
DEBT COLLECTION ACT
(5 U.S.C. § 5514)
Sec. 5514 -Installment deduction for indebtedness to the United States
(a)(1) When the head of an agency or his designee determines that an employee, member of the Armed Forces or Reserve of the Armed Forces, is indebted to the United States for debts to which the United States is entitled to be repaid at the time of the determination by the head of an agency or his designee, or is notified of such a debt by the head of another agency or his designee the amount of indebtedness may be collected in monthly installments, or at officially established pay intervals, by deduction from the current pay account of the individual. The deductions may be made from basic pay, special pay, incentive pay, retired pay, retainer pay, or, in the case of an individual not entitled to basic pay, other authorized pay. The amount deducted for any period may not exceed 15 percent of disposable pay, except that a greater percentage may be deducted upon the written consent of the individual involved. If the individual retires or resigns, or if his employment or period of active duty otherwise ends, before collection of the amount of the indebtedness is completed, deduction shall be made from subsequent payments of any nature due the individual from the agency concerned. All Federal agencies to which debts are owed and which have outstanding delinquent debts shall participate in a computer match at least annually of their delinquent debt records with records of Federal employees to identify those employees who are delinquent in repayment of those debts. The preceding sentence shall not apply to any debt under the Internal Revenue Code of 1986. Matched Federal employee records shall include, but shall not be limited to, records of active Civil Service employees government-wide, military active duty personnel, military reservists, United States Postal Service employees, employees of other government corporations, and seasonal and temporary employees. The Secretary of the Treasury shall establish and maintain an interagency consortium to implement centralized salary offset computer matching, and promulgate regulations for this program. Agencies that perform centralized salary offset computer matching services under this subsection are authorized to charge a fee sufficient to cover the full cost for such services.
(2) Except as provided in paragraph (3) of this subsection, prior to initiating any proceedings under paragraph (1) of this subsection to collect any indebtedness of an individual, the head of the agency holding the debt or his designee, shall provide the individual with - 810
(A) a minimum of thirty days written notice, informing such individual of the nature and amount of the indebtedness determined by such agency to be due, the intention of the agency to initiate proceedings to collect the debt through deductions from pay, and an explanation of the rights of the individual under this subsection;
(B) an opportunity to inspect and copy Government records relating to the debt;
(C) an opportunity to enter into a written agreement with the agency, under terms agreeable to the head of the agency or his designee, to establish a schedule for the repayment of the debt; and
(D) an opportunity for a hearing on the determination of the agency concerning the existence of the amount of the debt, and in the case of an individual whose repayment schedule is established other than by a written agreement pursuant to subparagraph (C), concerning the terms of the repayment schedule. A hearing, described in subparagraph (D), shall be provided if the individual, on or before the fifteenth day following receipt of the notice described in subparagraph (A), and in accordance with such procedures as the head of the agency may prescribe, files a petition requesting such a hearing. The timely filing of a petition for hearing shall stay the commencement of collection proceedings. A hearing under subparagraph (D) may not be conducted by an individual under the supervision or control of the head of the agency, except that nothing in this sentence shall be construed to prohibit the appointment of an administrative law judge. The hearing official shall issue a final decision at the earliest practicable date, but not later than sixty days after the filing of the petition requesting the hearing.
(3) Paragraph (2) shall not apply to routine intra-agency adjustments of pay that are attributable to clerical or administrative errors or delays in processing pay documents that have occurred within the four pay periods preceding the adjustment and to any adjustment that amounts to $50 or less, if at the time of such adjustment, or as soon thereafter as practical, the individual is provided written notice of the nature and the amount of the adjustment and a point of contact for contesting such adjustment.
(10 U.S.C. § 3716)
(a) After trying to collect a claim from a person under section 3711(a) of this title, the head of an executive, judicial, or legislative agency may collect the claim by administrative offset. The head of the agency may collect by administrative offset only after giving the debtor
(1) written notice of the type and amount of the claim, the intention of the head of the agency to collect the claim by administrative offset, and an explanation of the rights of the debtor under this section;
(2) an opportunity to inspect and copy the records of the agency related to the claim;
(3) an opportunity for a review within the agency of the decision of the agency related to the claim; and
(4) an opportunity to make a written agreement with the head of the agency to repay the amount of the claim.
(b) Before collecting a claim by administrative offset, the head of an executive, judicial, or legislative agency must either -
(1) adopt, without change, regulations on collecting by administrative offset promulgated by the Department of Justice, the General Accounting Office, or the Department of the Treasury;
(2) prescribe regulations on collecting by administrative offset consistent with the regulations referred to in paragraph (1).
(c)(l)(A) Except as otherwise provided in this subsection, a disbursing official of the Department of Treasury, the Department of Defense, the United States Postal Service, or any other government corporation, or any disbursing official of the United States designated by the Secretary of the Treasury, shall offset at least annually the amount of a payment which a payment certifying agency has certified to the disbursing official for disbursement, by an amount equal to the amount of a claim which a creditor agency has certified to the Secretary of the Treasury pursuant to this subsection.
(B) An agency that designates disbursing officials pursuant to section 3321(c) of this title is not required to certify claims arising out of its operations to the Secretary of the Treasury before such agency's disbursing officials offset such claims.
(C) Payments certified by the Department of Education under a program administered by the Secretary of Education under title IV of the Higher Education Act of 1965 shall not be subject to administrative offset under this subsection.
(2) Neither the disbursing official nor the payment certifying agency shall be liable -
(A) for the amount of the administrative offset on the basis that the underlying obligation, represented by the payment before the administrative offset was taken, was not satisfied; or
(B) for failure to provide timely notice under paragraph (8) . . . .
Award at 2-5.
Footnote # 1 for 59 FLRA No. 146 - Authority's Decision
The Debt Collection Act and Article 45 of the parties' agreement, which sets forth the procedures the Agency must follow in collecting debts under the Debt Collection Act, are set forth in relevant part in the Appendix.
Footnote # 2 for 59 FLRA No. 146 - Authority's Decision
B . A grievance means any complaint:
. . . .
(2) by the Association concerning any matter relating to the employment of any unit employee(s); or
(3) by a unit employee, the Association, or the Employer concerning:
(a) the effect or interpretation or a claim of breach of the collective bargaining agreement; or
(b) any claimed violation, [sic] misinterpretation of any law, rule, or regulation affecting conditions of employment.
Exceptions, Attachment 2 at 31.
Footnote # 3 for 59 FLRA No. 146 - Authority's Decision
(A) Should either the Employer or the Association be dissatisfied with the final decision of the other party in a grievance covered by this [a]greement, the party (Association or Employer) that brought the grievance may proceed to arbitration.
(B) Arbitration may be invoked only by the submission of the appropriate FMCS form by the grieving party to the other party within sixty (60) calendar days after the date of the receipt of the grievance case file.
Exceptions at 6 (quoting the parties' agreement).
Footnote # 4 for 59 FLRA No. 146 - Authority's Decision
[w]ith the consent of both parties, more than one arbitration case may be consolidated for review by the same arbitrator.
Exceptions at 4 (quoting the parties' agreement). Article 12, § (7)(A) of the parties' agreement provides:
[w]hen a group of unit employees has an identical grievance, it will be considered as an individual grievance of one unit employee and will be processed as a single grievance in the name of the unit employee designated by the others to act for them. All unit employees electing to join in the grievance must be identified and must sign the grievance at t