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The decision of the Authority follows:
32 FLRA No. 102
UNITED STATES OF AMERICA
FEDERAL LABOR RELATIONS AUTHORITY
NATIONAL COUNCIL BUREAU OF
INDIAN AFFAIRS EDUCATORS
UNITED STATES DEPARTMENT OF
THE INTERIOR, BUREAU OF INDIAN
AFFAIRS, NAVAJO AREA
Case No. 0-AR-1505
I. Statement of the Case
This matter is before the Authority on exceptions to the award of Arbitrator Howard V. Finston 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 Rules and Regulations. The Union did not file an opposition.
The Union filed a grievance alleging that the Agency acted improperly in making a contracting-out determination which resulted in a reduction-in-force (RIF) of Agency employees. The Union requested that the contract be terminated and that the affected employees be given backpay. The Arbitrator denied the grievance, determining that no grounds existed to order a reconstruction of the contracting process or to award backpay. However, the Arbitrator awarded the Union one-half of its attorney fees.
For the reasons stated below, the portion of the Arbitrator's award granting attorney fees is set aside.
II. Background and Arbitrator's Award
In 1985, the Agency entered into a contract with the Tuba City High School Board, Inc. (Board). Under the contract, the Board assumed administrative responsibility for educational and educational support services at the Tuba City High School (School). The contract was made pursuant to Public Law 93-638, which provides for greater levels of control and self-determination by Native Americans in education and other areas.
As a result of the contract, a RIF occurred among the Agency employees then working at the School. In August 1985, the Union President and affected employees were notified of the impending RIF. Affected employees were terminated at the end of the Fall 1985 semester.
The Union grieved the matter. The issue before the Arbitrator was whether the Agency's actions in entering into the contract violated Article VIII ("Management Rights") of the negotiated agreement and/or applicable laws and regulations of higher authority.
Before the Arbitrator, the Union argued that the Agency "failed to follow the law and applicable regulations by contracting with an improperly created school board [and therefore] there was no legitimate contractual underpinning to support the reduction in force[.]" Award at 5. The Union also asserted that the Agency attempted "to discredit the Union and to hinder the performance of the Union's responsibilities, all in violation of a good faith obligation underlying the negotiated agreement." Award at 6. Finally, the Union claimed that the Agency committed procedural errors in implementing the RIF.
In its request for relief to the Arbitrator, the Union requested, among other things, that: (1) the Agency be required to terminate the contract; (2) affected employees be granted backpay; and (3) the Union be awarded attorney fees.
The Agency argued to the Arbitrator that: (1) the grievance was not grievable; (2) the Board was legitimately constituted; (3) the Agency did not exhibit bad faith towards the Union; and (4) the Agency followed proper procedures in conducting the RIF. The Agency argued that the grievance should be denied for these reasons and that no remedy was merited.
The Arbitrator found that the issue before him was arbitrable. Noting the Authority's decision in Headquarters, 97th Combat Support Group (SAC), Blytheville Air Force Base, Arkansas and American Federation of Government Employees, AFL-CIO, Local 2840, 22 FLRA 656 (1986), the Arbitrator concluded that the Agency did not violate mandatory provisions of applicable procurement laws and regulations and thus reconstruction of the contract was not warranted. With respect to the Union's claim that the Agency acted in bad faith throughout the contracting period, the Arbitrator stated: "[A]t best, Agency officials were unresponsive to their obligation to deal with the Union in a straightforward, responsible manner. At worst, Agency behavior might be described as manipulative and vindictive in their approach" to the Union. Award at 18.
The Arbitrator concluded his opinion by stating:
[I]t does not seem appropriate to order reconstruction of the contract with the [Board], thus precluding approval of the Union's request for award of back pay, and restoration of other job benefits to affected employees.
What does seem appropriate here, from the standpoint of fairness and merit of the Union's argument regarding questionable treatment of the Union and unit members, is that the Union be awarded reimbursement for fifty percent (50%) of reasonable attorney fees associated with adjudication of this grievance, in accordance with Article XIX, Section 7 of the collective bargaining agreement.
Award at 19.(1)
As his award, the Arbitrator stated:
The Union's request that the P.L. 93-638 contract between the [Agency] and the [Board] be terminated is denied.
In view of certain irregularities associated with the Agency treatment of the Union, the Union President, and unit employees, the Union is awarded fifty percent (50%) of reasonable attorney fees to be paid by the Agency.
Award at 19.
III. Agency's Exception
The Agency excepts to the Arbitrator's award of attorney fees to the Union as contrary to law. The Agency argues that "there is no authority for the award of attorney fees in these circumstances and that such award is contrary to the requirements of 5 U.S.C. 5596." Exception at 2. The Agency asserts that no prohibited personnel action was found, and thus an award of attorney fees is precluded.
The Union did not file an opposition to the Agency's exceptions.
A threshold requirement for entitlement to attorney fees under the Back Pay Act, 5 U.S.C. § 5596, is a finding that the grievant had been affected by an unjustified or unwarranted personnel action which has resulted in the withdrawal or reduction of the grievant's pay, allowances, or differentials. Naval Air Development Center, Department of the Navy and American Federation of Government Employees, Local 1928, AFL-CIO, 21 FLRA 131 (1986). Further, an award of attorney fees must be in conjunction with an award of backpay to the grievant on correction of the unwarranted or unjustified personnel action, and in accordance with the standards established under 5 U.S.C. § 7701(g). Local 1749, American Federation of Government Employees and Commander, 47FTW, Laughlin Air Force Base, Texas, 24 FLRA 117, 118 (1986).
In this case, the Arbitrator denied the Union's request that the contract be terminated or reconstructed and denied the Union's request for an award of backpay. Under the statutory criteria, the Arbitrator's award does not justify an award of attorney fees to the Union. Accordingly, we will modify the Arbitrator's award by setting aside the award of attorney fees.
For the reasons stated above, the Arbitrator's award is modified by setting aside the award of attorney fees.(2)
Issued, Washington, D.C.,
Jerry L. Calhoun, Chairman
Jean McKee, Member
FEDERAL LABOR RELATIONS AUTHORITY
(If blank, the decision does not have footnotes.)
1. Article XIX, Section 7 of the parties' agreement provides:
Reasonable attorney fees may be awarded, not withstanding Section 4 of this Article, if they could be awarded based upon criteria outlined in 5 USC 7701(g)(1) if the deciding official determines that payment is warranted in the interest of justice in any case in which a prohibited personnel practice was engaged in by the Agency or where the Agency's action was clearly without merit. . . .
Award at 5.
2. The Agency requested a stay of the award when it filed its exception with the Authority on February 17, 1988. However, effective December 31, 1986, the Authority's Regulations were revised to revoke those portions pertaining to the filing of requests for stays of arbitration awards (51 Fed. Reg. 45754). Accordingly, no action on the stay request was taken.