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40:0079(9)AR - - DOD, Army and Air Force Exchange Service, George AFB, CA and NFFE Local 977 - - 1991 FLRAdec AR - - v40 p79

[ v40 p79 ]
The decision of the Authority follows:

40 FLRA No. 9













April 9, 1991

Before Chairman McKee and Members Talkin and Armendariz.

I. Statement of the Case

This matter is before the Authority on exceptions to the award of Arbitrator Donald A. Anderson 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 filed an opposition to the Agency's exceptions.

The Arbitrator determined that the Agency violated law, regulation, and the parties' collective bargaining agreement when it reduced the commission paid to automotive mechanics. The Arbitrator ordered the parties to meet in order to review the evidence on which the Agency based its determination to adjust commission rates. The Arbitrator ordered that if the adjusted commission rates were appropriate, they would remain in place, but that if the Agency could not justify the adjustment in commission rates, the parties were to establish the proper rates. Further, if it was determined that the mechanics were denied proper commission rates, they would be reimbursed for the difference. Finally, the Arbitrator retained jurisdiction for 60 days in order to assist in the resolution of questions concerning the appropriate commission rate.

For the following reasons, we conclude that the Agency has not demonstrated that the award is deficient. Therefore, the Agency's exceptions will be denied.

II. Background and Arbitrator's Award

The grievance in this case arose when the commission rates paid to automotive mechanics working for AAFES at George Air Force Base, California (the Activity), were reduced by 20 percent. The grievance alleged that the Activity's action was taken unilaterally and without the participation of the Union, as required by law and regulation.

The Arbitrator concluded that the Agency "violated the parties['] collective bargaining agreement, and federal law" when it adjusted the commission rates "without the participation and involvement of the Union." Award at 5. In so concluding, the Arbitrator dismissed the Agency's argument that an agreement had been reached before the Federal Prevailing Rate Advisory Committee (FPRAC) which gave the Agency the right unilaterally to change the commission rates provided the change was within the range established by FPM Supplement 532-2. The Arbitrator concluded that the transcript of the FPRAC meeting "was not convincing that such an agreement was intended" or superseded the requirements of 5 U.S.C. § 5343 and FPM Supplement 532-2 for union involvement in the determination of prevailing wage rates. Id.

The Arbitrator concluded that, in view of 5 U.S.C. § 5343 and of FPM Supplement 532-2, the Agency "violated the parties['] collective bargaining agreement, and federal law, when it unilaterally decided for commission wage adjustments for mechanics involved in this case without the participation and involvement of the Union." Id. The Arbitrator ordered the parties to "meet for the purpose of reviewing the evidence which prompted the Activity to adjust commission pay rates of mechanics." Id. at 6. The Arbitrator stated that, if the Agency's commission wage rate was "found to have to been appropriate for the geographical area in question, the Activity's wage adjustment shall stand." Id. The Arbitrator ordered that, if the Agency could not "justify" the adjustment of the mechanics' commission rate, the parties were "to establish the proper adjustments" and the mechanics were to "be reimbursed for the difference" between what they earned and what they would have earned pursuant to a proper adjustment of their commission rates. Id.

III. Positions of the Parties

A. The Agency's Exceptions

The Agency contends that the Arbitrator's award is deficient because it is contrary to law and regulation. Specifically, the Agency argues that the award is contrary to FPM Supplement 532-2, Appendix V. The agency asserts that the award requires it to "renegotiate an agreement reached with the Union in proceedings before" the FPRAC on June 19, 1984. Exceptions at 3.

The Agency also asserts that the Arbitrator's retention of jurisdiction results in a denial of its right under section 7122(b) of the Statute and section 2425.1(b) of the Authority's Rules and Regulations to file exceptions to the award. According to the Agency, "the substantive issue" of whether the commission rates it established for mechanics is appropriate will "become[] final and binding" before the Arbitrator rules on the remedy. Id. at 4.

B. The Union's Opposition

The Union asserts that there was no "agreement" that the Agency had unilateral authority to establish commission rates. Opposition at 1. Moreover, the Union asserts that any such agreement would be illegal and unenforceable.

IV. Analysis and Conclusions

A. FPM Supplement 532-2

We reject the Agency's argument that it was privileged unilaterally to change the commission rates for automobile mechanics.

The automotive mechanics are nonappropriated fund employees who are subject to the provisions of the Prevailing Rate Systems Act of 1972, Pub. L. No. 92-932, 86 Stat. 564 (1972) (codified as amended at 5 U.S.C. § 5341-5349 (1988) (the Act). Under the Act, the automotive mechanics are subject to the prevailing rate wage system, codified at 5 U.S.C. § 5343, whereby pay is to be fixed and adjusted from time to time as nearly as is consistent with the public interest in accordance with prevailing rates.

The Office of Personnel Management (OPM) is responsible for, among other things, issuing regulations which prescribe practices and procedures for implementing and administering the prevailing rate system. 5 U.S.C. § 5343(c). The OPM regulations are codified at part 532 of title 5, Code of Federal Regulations. Additionally, OPM issued Federal Personnel Manual (FPM) Supplement 532-2, entitled "Federal Wage System--Nonappropriated Fund Employees," which sets forth procedures and instructions for the administration and operation of the prevailing rate wage system as it applies to nonappropriated fund employees.

The automotive mechanics are subject to Appendix V of FPM Supplement 532-2, which sets forth a schedule of commission rates for various Army and Air Exchange Service employees. For automotive mechanics, the allowable commission range is set at 40 to 65 percent. Appendix V further provides that OPM is to undertake a study "to determine the most appropriate pay treatment" for employees such as the automotive mechanics, but that when "the appropriate agency wage-fixing authority determines, after appropriate consultation with labor organization representatives, that an earlier change in pay practices is required, such a change may be made earlier." FPM Supplement 532-2, Appendix V, at V-1. Subchapter S1 of FPM Supplement 532-2 provides that, "[i]n accordance with section 5343(c)(2) of Title 5, United States Code, there shall be participation at all levels by representatives of labor organizations accorded recognition as the representative of prevailing rate employees in every phase of providing an equitable system for fixing and adjusting the rates of pay" for prevailing rate employees.

The Agency alleges that, pursuant to an agreement reached at a FPRAC meeting on June 19, 1984, the Agency had authority unilaterally to adjust commission rates for automotive mechanics within the 40-65 percent range set by FPM Supplement 532-2. The Agency has not demonstrated that such an agreement exists, however. The transcript of the meeting discloses only that a representative of OPM stated that the parties had agreed "that management will undertake a study of federal and industry commission pay practices" and that "management . . . could unilaterally change commission percentages only if these were to remain within the stated percentages" in FPM Supplement 532-2. Attachment No. 5 to the Agency's Exceptions, at 33-34. The transcript contains no indication that a Union representative, or a representative of any other union, acknowledged such agreement. Moreover, the transcript reflects that, even if an agreement was reached, the agreement was to last only "during the course of the study" which the parties were to undertake. Id. at 34. The Agency submits no evidence that such a study took place.

Accordingly, we conclude, in agreement with the Arbitrator, that the Agency has not established that it had a right unilaterally to adjust the commission rates involved in this case. The Agency has failed to establish, therefore, that the Arbitrator's award is inconsistent with FPM Supplement 532-2.

B. Arbitrator's Retention of Jurisdiction

The Arbitrator retained jurisdiction to assist the parties in the event they are unable to "satisfactorily" determine the appropriate commission rate or if they need help to "expedite and finally resolve the matter." Award at 6. The Agency has failed to establish that the Arbitrator's retention of jurisdiction for this limited purpose renders the award deficient. See Overseas Education Association and Department of Defense Dependents Schools, Atlantic Region, 31 FLRA 80, 93 (1988). Moreover, the Agency has not established, and it is not otherwise apparent, that this retention of jurisdiction interferes in any way with the Agency's right to file exceptions to the award under section 7122 of the Statute. Accordingly, the Agency's exception provides no basis for finding the award deficient.

V. Decision

The Agency's exceptions are denied.

(If blank, the decision does not have footnotes.)