National Labor Relations Board (Agency) and National Labor Relations Board Union (Union)

[ v61 p197 ]

61 FLRA No. 38

NATIONAL LABOR
RELATIONS BOARD
(Agency)

and

NATIONAL LABOR
RELATIONS BOARD UNION
(Union)

0-AR-3940

_____

DECISION

August 31, 2005

_____

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 Paul D. Staudohar 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 sustained, in part, a grievance alleging that the Agency violated the parties' collective bargaining agreement and the Statute in its appraisal of the performance of two employees.

      For the reasons set forth below, we remand this case to the parties for further proceedings consistent with this decision.

II.     Background and Arbitrator's Award

      Under the Agency's performance appraisal system, employees receive a rating of level one to level five for each of four critical elements, and an overall rating based on a five-level scale ranging from unacceptable to outstanding. Two employees filed grievances alleging that they received lowered ratings because of their union activities. The grievances were consolidated and submitted to arbitration. The parties did not stipulate the issue, and the Arbitrator framed the issue as "whether the Agency discriminated or retaliated against the [g]rievants in their annual performance appraisals because of their union activity, in violation of the collective bargaining agreement, and if so, what shall the remedy be?" Award at 52.

      The Arbitrator concluded that the grievants were discriminated against in violation of Article 4, § 5(a) of the parties' agreement because of their union activities. [n1] 

With regard to the first grievant (employee A), the Arbitrator determined that:
[her] appraisal reflects a drastic, unprecedented reduction in her ratings. Although some of this downgrading is justified, a significant part of it appears to reflect a determination by the Agency to make a strong statement against her. While there is no `smoking gun,' the only apparent reason for this would be reprisal for her Union activities. The Agency did not appreciate her behavior in certain circumstances, which was an expression of her nature as well as her role in pursuing Union objectives. I think management became fed up with the whole thing and reacted to it. But the appraisal, in my view, is too strong a reaction.

Id. at 75. As for specific element ratings, the Arbitrator acknowledged, in connection with the element "effectiveness and efficiency," that employee A did not timely complete certain assignments. However, the Arbitrator determined that the level three rating for the element was improper and he raised it to level four because, according to the Arbitrator, the Agency did not take extenuating circumstances into account in its appraisal. Regarding the element "working relationships," the Arbitrator determined that the level two rating, reflecting a two-level drop from employee A's previous appraisal, was improper and he raised it to level three. The Arbitrator found that although evidence supported the Agency's contention that employee A resisted directives from management officials, "at least some of the friction and ill will" stemmed from her protected union activities, which could not be a proper basis for lowered ratings or punitive action. Id. at 73. The Arbitrator also determined that the level three rating for the element "oral and written communication," which reflected a two-level drop from the previous appraisal, was improper and he raised it to level four. The Arbitrator determined that a lower rating could be justified but that [ v61 p198 ] the two-level drop was punitive and not warranted by the evidence. Based on the changes in the individual element ratings, the Arbitrator ordered the Agency to raise employee A's overall rating from fully successful to commendable. [n2] 

      With regard to the second grievant (employee B), the Arbitrator determined that the level three rating for "effectiveness and efficiency" was improper and he raised it to level four. The Arbitrator found that although employee B had some timeliness problems, the Union provided a "convincing rebuttal" to a number of the criticisms in the narrative addressing this element. Id. at 82. The Arbitrator also noted the fact that favorable comments from several of employee B's supervisors were not included in the narrative. According to the Arbitrator, "[i]t is as though the deck was stacked against her on this critical element, because if all the circumstances are taken into account her work is clearly commendable." Id. The Arbitrator also ordered the Agency to pay employee B a monetary award based on her revised rating for "effectiveness and efficiency." In this regard, the Arbitrator found that the Agency did not grant employee B a monetary award specifically because of her level three rating for "effectiveness and efficiency." See Award at 84. According to the Arbitrator, as that rating had been raised, she was entitled to receive the award.

III.      Positions of the Parties

A.     Agency's Exceptions

      The Agency argues that the award is contrary to § 7116(a)(2) of the Statute because the Arbitrator failed to apply the burden-shifting framework established in Letterkenny Army Depot, 35 FLRA 113, 117-23 (1990) (Letterkenny). According to the Agency, the Union failed to establish a prima facie case of discrimination based on protected activity with respect to either employee A or employee B. In this regard, the Agency asserts that the Arbitrator made no actual findings that union animus existed, but instead "presumed" that union animus was the only reason that the employees' ratings were lowered. Exceptions at 18. The Agency contends that a finding of union animus may not be "presumed" and the fact that prior appraisals were higher does not, by itself, indicate that a subsequent appraisal was discriminatorily motivated. Id. (citing IRS, 8 FLRA 440, 449 n.7 (1982)). The Agency also contends that even if a prima facie case was established, the Arbitrator failed to properly analyze the Agency's "ample" evidence that the employees' ratings would have been the same even in the absence of any protected activity. Id. at 19. According to the Agency, the Arbitrator credited the Agency's testimony and evidence supporting each of the contested ratings and then issued an award inconsistent with these findings.

      In addition, the Agency asserts that the monetary award granted to employee B violates the Back Pay Act. The Agency claims that it did not commit an unwarranted or unjustified personnel action and that, even if it did, there was no causal connection between the contested performance rating and the monetary award. In this regard, the Agency asserts that monetary awards are not an entitlement but are discretionary and that the Arbitrator failed to find that "but for" the improper rating, employee B would have received an award. Id. at 22.

      The Agency further argues that the award is contrary to § 7106(a)(2) of the Statute because the Arbitrator's order to raise the employees' performance ratings impermissibly affects management's rights to direct employees and assign work. The Agency asserts that Prong I of the test established in United States Dep't of the Treasury, Bureau of Engraving and Printing, Washington, D.C., 53 FLRA 146 (1997) (BEP) was not satisfied because the Arbitrator did not find that the Agency failed to apply established performance elements and standards, or that the Agency applied them in violation of law, regulations or the parties' agreement. With regard to Prong II of BEP, the Agency argues that the award does not reflect a reconstruction of what management's appraisal of the employees would have been had it not acted improperly.

B.     Union's Opposition

      The Union contends that the Arbitrator explicitly found evidence supporting union animus, which led to the employees being discriminated against in their performance appraisals because of protected activity. The Union also asserts that the Agency's claim that the Arbitrator failed to properly analyze evidence demonstrating that the employees' ratings would have been the same in the absence of any protected activity does not establish that the award is deficient.

      In addition, the Union argues that the monetary award granted to employee B is not contrary to the Back Pay Act. The Union claims that the Arbitrator found a causal relationship between the Agency's discrimination and employee B's loss of the award. The Union further contends that the award satisfies prong II of BEP because the remedy directed by the Arbitrator reflects a reconstruction of what management would have done had it not violated the parties' agreement. [ v61 p199 ]

IV.     Analysis and Conclusions

      The Agency argues that the award is contrary to § 7116(a)(2) of the Statute, the Back Pay Act, and management's rights to direct employees and assign work. The Authority reviews questions of law de novo. See NTEU, Chapter 24, 50 FLRA 330, 332 (1995) (citing United States Customs Serv. v. FLRA, 43 F.3d 682, 686-87 (D.C. Cir. 1994)). In applying a standard of de novo review, the Authority determines whether the arbitrator's legal conclusions are consistent with the applicable standard of law. See NFFE, Local 1437, 53 FLRA 1703, 1710 (1998). In making that determination, the Authority defers to the arbitrator's underlying factual findings. See id.

      The Arbitrator framed the issue as a contract (not a statutory) violation: whether the Agency discriminated against the grievants in their annual performance appraisals because of union activity "in violation of the [parties'] agreement." Award at 52. Nevertheless, the Authority has applied statutory standards in assessing the application of contract provisions that mirror, or are intended to be interpreted in the same manner as, the Statute. See AFGE, 59 FLRA 767, 769-70 (2004). Here, the contract provision relied on by the Arbitrator, Article 4, § 5(a), is identical to § 7116(a)(2) of the Statute in all relevant aspects. [n3]  Moreover, the Union specifically argued before the Arbitrator that the Agency conducted the employees' performance appraisals in violation of § 7116(a)(2) of the Statute, the Agency makes statutory (not contractual) objections to the award, and neither party contends that the Arbitrator applied contractual standards to the dispute. See Opposition, Exhibit A at 47. Accordingly, we review the award under statutory principles applicable in unfair labor practice (ULP) cases.

      Section 7116(a)(2) of the Statute provides that it is an unfair labor practice for an agency to encourage or discourage membership in a union by discrimination in connection with hiring, tenure, promotion, or other conditions of employment. When a grievance under § 7121 of the Statute involves an alleged ULP, the arbitrator must apply the same standards and burdens that would be applied by an administrative law judge in a ULP proceeding under § 7118. See, e.g., AFGE, Local 3529, 57 FLRA 464, 465 (2001). In a grievance alleging a ULP by an agency, the Union bears the burden of proving the elements of the alleged ULP by a preponderance of the evidence. See id. As in other arbitration cases, the Authority defers to an arbitrator's findings of fact. See id.

      In Letterkenny, the Authority addressed the analytical framework to be applied in cases alleging a violation of § 7116(a)(2) of the Statute. Under this framework, the party alleging discrimination must establish that: (1) the employee against whom the alleged discriminatory action was taken was engaged in protected activity; and (2) such activity was a motivating factor in the agency's treatment of the employee. If the required prima facie showing is made, then an agency may seek to establish the affirmative defense that: (1) there was a legitimate justification for its action; and (2) the same action would have been taken even in the absence of protected activity. See Letterkenny, 35 FLRA at 118. In cases, such as this one, where a judge or arbitrator does not explicitly apply the Letterkenny framework in making his or her determinations, the Authority examines whether the determinations are consistent with the requirements of Letterkenny. See Fed. Emergency Mgmt. Agency, 52 FLRA 486, 491-92 (1996); United States Dep't of the Treasury, IRS, Ogden Serv. Ctr., Ogden, Utah, 42 FLRA 1034, 1053 (1991) (Ogden Serv. Ctr.).

A.     Employee A

      With regard to the first element of the Union's prima facie case, the parties do not dispute that employee A was engaged in protected activity during the appraisal period in dispute. Regarding the second element, the Arbitrator found that employee A's appraisal reflected a "drastic, unprecedented reduction in her ratings" and that a significant part of it "appears to reflect a determination by the Agency to make a strong statement against her." Award at 75. According to the Arbitrator, the only apparent reason for lowered ratings was reprisal for her union activities. Id. In addition, upon examining employee A's rating for the element "oral and written communication," the Arbitrator stated that "at least some of the friction and ill will" stemmed from her protected union activities. Id. at 73. The Arbitrator's conclusions are consistent with a finding that employee A's protected activity was a motivating factor in the Agency's appraisal of employee A. See Ogden Serv. Ctr., 42 FLRA at 1053. We note, in this regard, that contrary to the Agency's claim, nothing in Letterkenny requires a finding of union animus to establish a prima facie case. See United States Dep't of the Air Force, 60th Air Mobility Wing, Travis Air Force Base, Cal., 59 FLRA 632, 636-37, 643 (2004) (prima facie case established without union animus).

      The Agency's affirmative defense requires establishment of both elements set out in Letterkenny. See SSA, Baltimore, Md., 53 FLRA 1751, 1755 (1998); see also Dep't of the Air Force, Warner Robins Air Logistics Ctr., Warner Robins Air Force Base, Ga., 52 FLRA 602, 605 (1996) (in finding that agency established affirmative defense, Authority examined both elements set forth in Letterkenny). As applied here, the [ v61 p200 ] Arbitrator's findings indicate that the Agency had legitimate justification -- the first element of the affirmative defense -- for lowering some if not all of employee A's element ratings. For example, the Arbitrator found that employee A did not timely complete her work assignments in some instances, that she resisted directives from management officials, and that her performance regarding oral and written communication justified a lower rating. See Award at 66-75. As for the second element of the affirmative defense, however, the Arbitrator did not find that, and the record does not indicate whether, the Agency would have taken the same action in the absence of employee A's protected activity. We note, in this regard, that two of the three contested element ratings were two-level drops from the previous appraisal. Even assuming that the Agency had legitimate justification for lowering the ratings, the record does not indicate whether the Agency would have given employee A the same (two level lower) ratings in the absence of her union activity.

      As it is not possible to determine from the record whether the Agency established an affirmative defense with respect to employee A, we are unable to determine whether the award is contrary to law. Where an award fails to contain the factual findings necessary to enable the Authority to assess the arbitrator's legal conclusions, and the findings cannot be derived from the record, the case will be remanded to the parties for submission to the arbitrator so that the requisite findings can be made. See NFFE, Local 1437, 53 FLRA at 1712. Accordingly, we remand the award to the parties for submission to the Arbitrator, absent settlement, for findings necessary to determine whether the Agency would have taken the same action against employee A even in the absence of her protected activity. See id.

B.     Employee B

      As with employee A, the parties do not dispute that employee B was engaged in protected activity during the appraisal period in dispute. With regard to the second element of the Union's prima facie case, however, nothing in the record indicates whether employee B's union activity was a motivating factor in the Agency's treatment of her. In this regard, the Arbitrator stated that "[i]t is as though the deck was stacked against [employee B] on [the] element [of effectiveness and efficiency], because if all the circumstances are taken into account her work is clearly commendable." Award at 82. However, the record does not indicate whether this "stacked deck" referred to employee B's union activity. As there is no basis in the record for determining whether the protected activity of employee B was a motivating factor in the Agency's treatment of employee B, the record does not permit the Authority to determine whether a prima facie case was made with respect to employee B.

      Moreover, even assuming that the Arbitrator properly found that the Union had established a prima facie case, the record does not permit the Authority to determine whether the Agency established an affirmative defense with respect to