U.S. Federal Labor Relations Authority

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22:0142(14)AR - DOD Dependents Schools and Overseas Education Association -- 1986 FLRAdec AR

[ v22 p142 ]
The decision of the Authority follows:

 22 FLRA No. 14
                                            Case No. 0-AR-1024
                         I.  STATEMENT OF THE CASE
    This matter is before the Authority on an exception to the award of
 Arbitrator Roger Kaplan 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.  The Union filed an opposition.
    The grievance in this case concerns the administratively determined
 indebtedness of the grievant, a school counselor, in the amount of
 $7,574.  The amount represents two years of tuition-free education the
 Activity claimed was provided a student as the result of
 misrepresentations by the grievant.  According to the Arbitrator, the
 grievant and the grievant's mother had entered into an agreement
 transferring guardianship of the student from the mother to the grievant
 in order for the student to be eligible for tuition-free education at
 Bitburg American High School.  When the grievant failed to submit a
 court decree approving the guardianship agreement, the grievant was
 required to submit a sworn statement that he had assumed "in loco
 parentis" status and was supporting the student.  On the basis of the
 grievant's statements, the student was provided the two years of
 tuition-free education.  Subsequently, after an investigation, the
 Activity proposed to remove the grievant based upon charges that his
 statements regarding his support of the student had been false.  The
 charges against the grievant were sustained and he was ultimately
 suspended for 14 days and reassigned.  It was on the basis of these
 sustained charges that the indebtedness of the grievant was determined.
 The grievant thereafter filed the grievance contesting the claim of
 indebtedness and the grievance was submitted to arbitration.  As his
 award, the Arbitrator sustained the grievance, finding that the grievant
 was not indebted for the student's tuition costs, and ordered management
 to cancel the demand for payment.
                              III.  EXCEPTION
                       A.  Contentions of the Agency
    in its exception the Agency contends that the award is contrary to
 law and regulation pertaining to the recovery through salary offset of
 certain debts owed the United States by Federal employees.  The Agency
 argues that administratively determined indebtedness is not subject to
 resolution under a grievance procedure negotiated in accordance with the
 Statute and must be determined pursuant to 5 U.S.C. section 5514.  /1/
 In particular, the Agency argues that to permit the grievance and
 arbitration over such indebtedness is contrary to section 5514.  The
 Agency also argues that to permit the grievance and arbitration of such
 matters is contrary to 5 CFR part 55, subpart K, providing for
 collection by salary offset from indebted employees.  Specifically, the
 Agency maintains that the use of the negotiated grievance procedure is
 contrary to 5 CFR section 550.1104 which requires each agency to assure
 that its regulations governing the collection of debts are uniformly and
 consistently applied to all employees.  The Agency asserts that because
 the negotiated grievance procedure is available only to bargaining-unit
 employees, use of the negotiated grievance procedure necessarily
 precludes uniformity and consistency of application in violation of 5
 CFR section 550.1104.
                        B.  Opposition of the Union
    In its opposition to the Agency's exception, the Union primarily
 argues that 5 U.S.C. section 5514 and 5 CFR part 550, subpart K are not
 applicable to bar the grievance or the Arbitrator's award because
 collection of the claimed indebtedness was not sought by salary offset.
                       IV.  ANALYSIS AND CONCLUSIONS
    For the reasons which follow, the Authority finds that the provisions
 of 4 U.S.C. section 5514 do not preclude an arbitrator from ruling on
 and overturning an assessment of administratively determined
 indebtedness against an employee.  Collective bargaining agreements
 negotiated under section 7121 of the Statute must contain a grievance
 procedure and that procedure, except as provided in section 7121(d) and
 (e), /2/ is the exclusive procedure for resolving grievances which fall
 within its coverage.  /3/ Thus, the negotiated grievance procedure may
 be invoked to settle disputes within its coverage despite the existence
 of internal agency appeal procedures or statutory appeal procedures
 which also cover the matter at issue.  As to certain statutory or
 appellate procedures, section 7121(d) and (e) of the Statute, as noted,
 demonstrate that Congress was aware of other statutory appeal procedures
 when it provided in the Statute for negotiated grievance and arbitration
 procedures.  It is clear that Congress intended the negotiated
 procedures to be an alternative to those specified statutory and
 appellate procedures.  /4/ As to internal agency procedures and
 statutory procedures not specified in section 7121(d) and (e), Congress
 intended that the negotiated grievance procedure replace those
 procedures.  /5/ Consequently, unless it can be shown that the
 procedures governing the collection by salary offset of any debts owed
 the United States are intended to be the exclusive procedures for
 resolving these matters, such matters are within the scope of the
 negotiated grievance procedure prescribed by the Statute.
    Both the courts and the Authority have determined that Federal law
 outside the Statute can limit the scope of the negotiated grievance
 procedure.  See American Federation of Government Employees, AFL-CIO,
 Council 214 and Department of the Air Force, Headquarters Air Force
 Logistics Command, Wright-Patterson Air Force Base, Ohio, 21 FLRA No. 34
 (1986) (proposal 2 and cases cited in the decision).  Consequently,
 notwithstanding that the Activity had not expressly determined to
 proceed to collect the indebtedness from the grievant by salary offset,
 the Authority has examined the provisions cited by the Agency to
 determine whether the provisions are the exclusive procedures available
 to Federal employees to challenge indebtedness to the United States so
 as to overcome section 7121 of the Statute.  In disagreement with the
 Union, we find that the provisions must be examined in this respect
 because they generally apply to the grievant's situation of being
 determined to be indebted to the United States and as a Federal
 employee, at least, being subject to salary offset in the collection of
 that debt.
    In the cases where the courts and the Authority have found that
 outside law limits the scope of the negotiated grievance procedure,
 there have been clear specific indications that the statutory procedures
 were intended to be exclusive.  Headquarters, AFLC, slip op. at 6-7.
 For example, in each instance, statutory provisions convering those
 procedures provided that they should take effect "notwithstanding" any
 other law.  See New Jersey Air National Guard v. FLRA, 677 F.2d 276 (3rd
 Cir. 1982);  Veterans Administration Medical Center, Minneapolis,
 Minnesota v. FLRA, 705 F.2d 953 (8th Cir. 1983).  The Agency in its
 exception cites no such provisions in section 5514.  Therefore, the
 Authority finds that none of the Agency's arguments provide a basis for
 concluding that the grievance in this case protesting the Activity's
 determination of indebtedness is excluded by law from the coverage of
 the negotiated grievance procedure.
    Simiarly, the Authority finds that the Agency's arguments provide no
 basis for finding the award contrary to 5 CFR part 550, subpart K.  The
 Agency has argued in its exception that permitting the use of the
 negotiated grievance procedure in these matters, which is available only
 to bargaining-unit employees under a collective bargaining agreement,
 necessarily precludes uniformity and consistency of application of
 agency regulations to all employees as required by 5 CFR section
 550.1104.  However, the means of dispute resolution that may be
 available to individual employees has not been shown to preclude the
 uniform and consistent application to all employees of the substantive
 terms of agency regulations governing the collection of debts.
 Furthermore, the Agency's argument that there cannot be uniformity and
 consistency because grievance and arbitration is not available to
 nonbargaining-unit employees is without merit and provides no basis for
 finding the award deficient.  Such an effect is precisely the result
 contemplated by the terms and provisions of the Statute.
    Accordingly, for these reasons, the Agency's exception provides no
 basis for finding the award deficient as contrary to law or regulation,
 and the exception is denied.
    Issued, Washington, D.C., June 13, 1986.
                                       /s/ Jerry L. Calhoun, Chairman
                                       /s/ Henry B. Frazier III, Member
                                       FEDERAL LABOR RELATIONS AUTHORITY
                ---------------  FOOTNOTES$ ---------------
    (1) 5 U.S.C. section 5514 is set forth in the Appendix.
    (2) Section 7121(d) and (e) provide the aggrieved employee in the
 specified matters, none of which include the matter involved in this
 case, an option of raising the matter under the negotiated grievance
 procedure, if the matter has not been excluded by the parties, or under
 applicable statutory or appellate procedures.
    (3) The term "grievance" is defined in section 7103(a)(9) to include
 any complaint by any employee concerning any matter relating to the
 employment of the employee or concerning any claimed violation,
 misinterpretation, or misapplication of any law, rule, or regulation
 affecting conditions of employment.  Section 5 of the Debt Collection
 Act of 1982 amended 5 U.S.C. section 5514 to provide the Government with
 the authority to take offset against the salaries of Federal employees
 in order to collect any debts owed the United States, and the Office of
 Personnel Management has prescribed regulations governing the collection
 of such debts by salary offset.  Pub. L. No. 97-365, 96 Stat. 1749;  5
 U.S.C. section 5514;  5 CFR part 550, subpart K.  Any complaint by an
 employee about such an indebtedness or collection action would be a
 "grievance" and would be covered by the negotiated grievance unless
 excluded by law or by the parties.
    (4) See H.R. Rep. No. 95-1403, 95th Cong., 2d Sess. 56 (1978);  S.
 Rep. No. 95-969, 95th Cong., 2d Sess. 110 (1978).
    (5) See H.R. Rep. No. 95-171, 95th Cong., 2d Sess. 157 (1978);  S.
 Rep. No. 95-969, 95th Cong. 2d Sess. 110 (1978).
    5 U.S.C. Section 5514 provides:
          Section 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 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 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.
          (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 --
          (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
          (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;
          (D) an opportunity for a hearing on the determination of the
       agency concerning the existence or 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) The collection of any amount under this section shall be in
 accordance with the standards promulgated pursuant to sections 3711 and
 3716-3718 of title 31 or in accordance with any other statutory
 authority for the collection of claims of the United States or any
 agency thereof.
          (4) For the purposes of this subsection --
          (A) "disposable pay" means that part of pay of any individual
       remaining after the deduction from those earnings of any amounts
       required by law to be withheld;  and
          (B) "agency" includes the United States Postal Service and the
       Postal Rate Commission.
          (b)(1) The head of each agency shall prescribe regulations;
       subject to the approval of the President, to carry out this
       section and section 3530(d) of title 31.  Regulations prescribed
       by the Secretaries of the military departments shall be uniform
       for the military services insofar as practicable.
          (2) For purposes of section 7117(a) of this title, no
       regulation prescribed to carry out subsection (a)(2) of this
       section shall be considered to be a Government-wide rule or
          (c) Subsection (a) of this section does not modify existing
       statutes which provide for forfeiture of pay or allowances.  This
       section and section 3530(d) of title 31 do not repeal, modify, or
       amend section 4837(d) or 9837(d) of title 10 or section 1007(b),
       (c) of title 37.