[ v20 p380 ]
The decision of the Authority follows:
20 FLRA No. 39 BUREAU OF ENGRAVING AND PRINTING, U.S. DEPARTMENT OF THE TREASURY Activity and WASHINGTON PLATE PRINTERS UNION, LOCAL NO. 2, IPDEU, AFL-CIO Union Case No. 0-AR-818 DECISION This matter is before the Authority on exceptions to the award of Arbitrator Frederick U. Reel filed by the Agency under section 7122(a) of the Federal Service Labor-Management Relations Statute and part 2425 of the Authority's Rules and Regulations. A grievance was filed and submitted to arbitration in this case challenging the Activity's implementation of revised performance standards for journeyman plate printers at the Activity. Before the Arbitrator the Activity maintained that the grievance was not grievable because the Union's grievance essentially challenged the content of the production standard that had not yet been applied to any employees. The Arbitrator agreed that the Activity was free to establish unilaterally a new production performance standard, but disagreed that this was dispositive of the grievance. Instead, the Arbitrator viewed the grievance as encompassing a challenge to the Activity's implementation of the revised performance standards without permitting bargaining over the "methodology" used by the Activity in revising the standards or over the allowance for non-productive "down time." Because the Arbitrator determined these matters to be within the duty to bargain, the Arbitrator sustained the grievance and directed that the Activity bargain with the Union over these matters, that the Activity stop giving effect to the revised performance appraisal system, and that the Activity cancel any appraisals issued under the revised system. As one of its exceptions, the Agency contends that the award is deficient as contrary to section 7106(a)(2)(A) and (B) of the Statute. The Authority agrees. The Authority has consistently held that proposals which substantively restrict management in its identification of critical elements of a position and establishment of performance standards are inconsistent with section 7106(a)(2)(A) and (B) of the Statute as improper interferences with management's right to direct employees and to assign work. E.g., National Treasury Employees Union and Department of the Treasury, Bureau of the Public Debt, 3 FLRA 769(1980), aff'd sub nom. NTEU v. FLRA, 691 F.2d 553 (D.C. Cir. 1982); American Federation of Government Employees, AFL-CIO, Local 1968 and Department of Transportation, Saint Lawrence Seaway Development Corporation, Massena, New York, 5 FLRA 70(1981) (Proposals 1-2), aff'd sub nom. AFGE, Local 1968 v. FLRA, 691 F.2d 565 (D.C. Cir. 1982), cert. denied, 461 U.S. 926(1983). Similarly, the Authority has held that proposals which would, as their sole effect, subject management's determinations concerning the identification of critical elements and the content of performance standards to the grievance procedure and arbitral review constituted improper interference with management's rights. E.g., Saint Lawrence Seaway Development Corporation, 5 FLRA 70 (Proposal 4). In so holding, the Authority has noted that subjecting managerial evaluations concerning critical elements and performance standards to arbitral review would require an arbitrator to substitute his or her judgement as to how the agency should be run for that of management. National Treasury Employees Union and Department of Health and Human Services, Region 10, 13 FLRA 732, 734(1982), aff'd sub nom. NTEU v. FLRA, No. 84-7034 (9th Cir, Aug. 5, 1985). "Under the Statute, however, management has the right to evaluate the relative importance of job tasks and to formulate levels of achievement for those tasks based upon its own determination of the agency's operating needs, goals, and priorities." Id. With respect to the arbitrator's role in resolving grievances involving performance appraisal matters, consistent with the above holdings and section 7106(a)(2)(A) and (B) of the Statute, an arbitrator could not determine that a grievance directly challenging an agency's identification of job elements or establishment of performance standards is grievable and arbitrable. E.g., Veterans Administration, St. Louis, Missouri and American Federation of Government Employees, Local 2192, 19 FLRA No. 30(1985); American Federation of Government Employees, Local 1917 and U.S. Immigration and Naturalization Service, 15 FLRA No. 147(1984). Nor could an arbitrator render an award substituting his or her judgment concerning the identification of critical job elements and establishment of performance standards for that of management. See, e.g., National Treasury Employees Union and U.S. Customs Service, 17 FLRA No. 12(1985). It is equally well established, on the other hand, that there is a duty to bargain under section 7106(b)(3) on appropriate arrangements for employees adversely affected by management's exercise of its authority under section 7106(a), e.g., actions which adversely affect employees taken under the performance standards established by management. E.g., American Federation of Government Employees, AFL-CIO, Local 32 and Office of Personnel Management, Washington, D.C., 3 FLRA 784, 791-92(1980) (Proposal 5). Thus, in the facts of that case, the Authority specifically found that the proposal in dispute merely established a general, nonquantitative requirement by which the application of critical elements and performance standards established by management may subsequently be evaluated in a grievance by an employee who believes that he or she has been adversely affected by the application of management's performance standard to him or her. To that extent, the Authority held that the proposal was within the duty to bargain. Under such a proposal the Authority noted that an employee against whom management takes disciplinary action for unacceptable performance may, in a grievance of such action pursuant to section 7121(e) of the Statute, raise the issue of whether the performance standards as applied to him or her meet the contractual requirements, i.e., the arbitrator of such a grievance would simply determine if the standard established by management as applied to the grievant complied with the "fair and equitable . . . " requirements of the parties' agreement. In finding that proposal to be within the duty to bargain, the Authority specifically noted that such an arrangement did not affect management's discretion to determine the content of performance standards nor did it authorize an arbitrator to substitute his or her judgment for that of management as to the content of the standards. The Authority has distinguished between proposed grievance procedures subjecting management's identification of critical elements and establishment of performance standards to arbitral review and grievance procedures relating only to the application of such elements and standards to an individual employee through the appraisal process. Saint Lawrence Seaway Development Corporation, 5 FLRA 70 (Proposal 4). As has been noted, the Authority found in that case that a proposed procedure which provided for grievances directly challenging the identification of critical elements and the establishment of the performance standards conflicted with management's rights. In contrast, however, the Authority citing AFGE, Local 32, also ruled that a proposed extension of the grievance procedure to any action taken as a result of the application of performance standards to an employee appropriately would extend the negotiated grievance procedure to matters relating to the adverse affect on an employee of the exercise by management of its authority under section 7106 of the Statute. In ruling that the application of management's elements and standards to an employee in the context of a performance appraisal is grievable, the Authority has consistently emphasized, as in the OPM case discussed above, that such a grievance would not relate to the establishment of the standards, because the review by an arbitrator would not preclude management from determining the content of the elements and standards and would not result in the setting of new elements and standards. Instead, arbitral review would simply and appropriately determined whether the application of the elements and standards to the employee through a performance appraisal complied with applicable law, regulation, and the parties' collective bargaining agreement. See, e.g., American Federation of Government Employees, AFL-CIO, Local 3804 and Federal Deposit Insurance Corporation, Chicago Region, Illinois, 7 FLRA 217(1981) (Proposal 7). Consistent with the above holdings and the Statute, an arbitrator may resolve a grievance by an employee who believes that he or she has been adversely affected by management's application of performance standards in a performance appraisal to that particular employee. In judging management's application of standards and elements to a grievant, an arbitrator may determine that, in the circumstances of the case, management has not applied the elements and standards which it had established to a grievant or has applied those, or other elements and standards, in violation of law, regulation, or an appropriate agreed-upon general, nonquantitative review criterion. In such circumstances, an arbitrator could, for example, sustain an employee's grievance alleging that management had not applied the elements and standards which it had established or had applied those, or other elements and standards, in violation of law, regulation, or an appropriate agreed-upon general, nonquantitative review criterion. In sustaining the grievance the arbitrator as a remedy could direct that the grievant's work product be granted the rating to which entitled under the standards and elements established by management or be reevaluated by management utilizing those standards and elements. Social Security Administration and American Federation of Government Employees, SSA, Local 1923, AFL-CIO, 7 FLRA 544(1982). See also American Federation of Government Employees, AFL-CIO, Loclal 2855 and U.S. Army, Military Traffic Management Command, Eastern Area, 13 FLRA 251, 253(1983). However, in resolving such a grievance, an arbitrator may not, of course, substitute his or her judgment for that of the agency as to the appropriateness of elements and standards established by management. Further, an arbitrator may not conduct an independent evaluation of an employee's performance under the elements and standards established by management and substitute his or her judgment as to what should be that employee's performance evaluation and rating. In terms of this case, the Arbitrator correctly determined that to the extent the grievance objected to the "numbers" of the production performance standard, the grievance directly challenged the Activity's exercise of its authority to establish new standards and could not be considered. However, contrary to the determination in the award that the grievance was grievable and arbitrable to the extent of methodology and "down time," the Authority has likewise held that proposals concerning such matters pertain to the exercise by management of its authority to establish performance standards and consequently are inconsistent with section 7106(a)(2)(A) and (B) of the Statute. E.g., American Federation of Government Employees, Local 32, AFL-CIO and Office of Personnel Management, 19 FLRA No. 9(1985) (Proposal 2 ("down time")); Saint Lawrence Seaway Development Corporation, 5 FLRA 70 (Proposal 3 (methodology)). Consequently, the Authority concludes that by finding the grievance arbitrable to the extent of methodology and "down time" and resolving the grievance to that extent on the merits, the award is deficient in its entirety as contrary to section 7106(a)(2)(A) and (B) of the Statute. Accordingly, the award is set aside. /1/ Issued, Washington, D.C. September 27, 1985 (s) HENRY B. FRAZIER III Henry B. Frazier III, Acting Chairman (s) WILLIAM J. MCGINNIS JR. William J. McGinnis, Jr., Member FEDERAL LABOR RELATIONS AUTHORITY --------------- FOOTNOTES$ --------------- /1/ In view of this decision, it is not necessary for the Authority to address the Agency's other exception to the award.