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The decision of the Authority follows:
41 FLRA No. 30
Before Chairman McKee and Members Talkin and Armendariz.
I. Statement of the Case
This matter is before the Authority on exceptions to an award of Arbitrator Bernard Marcus 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 two grievances involved in this case concerned the Agency's decision to fill vacant fire officer positions by detail or temporary promotion instead of by permanent promotion. The Agency had instituted a new training program designed to provide qualified candidates for vacant fire officer positions and delayed making permanent promotions until office personnel successfully completed the program. The Arbitrator determined that the Agency had violated the parties' collective bargaining agreement when it detailed employees to higher-graded positions for 30 days or less without paying those employees at the higher wage rate. As a remedy, the Arbitrator directed the Agency to pay those employees backpay at the higher rate. The Arbitrator also ruled that the Agency must bargain, at the Union's request, concerning mid-term changes in the criteria for selecting employees for promotion to fire officer positions and concerning proposed revisions in job descriptions.
The Agency filed exceptions alleging that the award of backpay is contrary to an Agency regulation and to the Back Pay Act, 5 U.S.C. § 5596. The Agency also contends that the requirement to negotiate over aspects of the training program violates management's rights under section 7106(a) of the Statute. For the reasons discussed below, we will deny the Agency's exceptions.
II. Background and Arbitrator's Award
In 1987, the Agency decided to change the mission of the fire division by placing more emphasis on marine and hazardous materials firefighting. As a means of increasing the technical and managerial skills of fire officers, the Agency determined that it would establish an officer training program and would not fill vacancies in fire officer positions until candidates that had successfully completed the training program became available.
In implementing the new policy, the Agency announced that it was suspending the practice of filling fire officer vacancies. The Agency informed the Union that vacancies would be frozen until candidates had completed the training program and vacancies would be filled only by graduates of the training program. The Agency explained the details of the new training program to the Union but denied the Union's request "to negotiate the criteria for selection of candidates for training." Award at 15.
On July 4, 1988, the Union filed a grievance "protesting management's refusal to promote 'qualified Panamanian nationals into the existing nine vacant officers positions, which is in violation of Article X of the Panama Canal Treaty.'" Id. at 18. The Union continued in its attempt to negotiate with management over the criteria for selection into the training program. On September 26, 1988, after the Agency had denied the Union's formal request for documentation on selections for the first training program, the Union filed a second grievance protesting the Agency's unilateral action in implementing and making selections for the training program. The grievances were consolidated and submitted to arbitration on a number of issues, including the following:
Whether the Panama Canal Commission, in violation of law, regulation or the labor agreement, has failed or refused to make promotions to vacant fire office positions from among the non-officer personnel of the Fire Division.
Whether a training program for fire officer personnel and for aspirants to fire officer vacancies (which program was institute[d] by the Panama Canal Commission in mid-1988) is violative of law, regulation, or the labor agreement.
Whether the Panama Canal Commission violated the terms of Article XXVI of the labor agreement when it failed or refused to submit the plan for the training program referred to above to mid-term bargaining. Similarly, was there such a violation when the Commission revised the position descriptions by means of a Fire Division addendum.
Id. at 2-3 (footnote omitted).
With regard to the freeze on filling vacancies in fire officer positions, the Arbitrator found no merit in the Union's argument that the promotion freeze violated an Agency past practice. The Arbitrator held that the Union had the right to negotiate over how vacancies are to be filled but the Union did not have the right to negotiate over the decision whether to fill vacancies. He noted, however, that management's right to determine whether to fill vacancies is restricted "where duties associated with a vacancy have been reassigned and continue to be performed by employees in other classifications[.]" Id. at 32. Under those circumstances, the Arbitrator stated, "the Arbitrator retains the power to determine whether or not the employer has intentionally avoided a contractual obligation." Id.
The Arbitrator found that there was proof of management misconduct involving the improper use of details to fill vacancies. The Arbitrator stated that "2 1/2 years of details proves that the objective is not training and evaluation but is rather an attempt to get something for nothing." Id. at 34-35 n.9.
The Arbitrator concluded that the Agency had identified details as training devices in order to justify not paying employees temporarily detailed to a higher-graded position at the higher rate and determined that the length of the freeze on filling vacancies was inconsistent with the stated training objective. He stated that there was "a reasonable inference that the Agency wanted to save money at the expense of bargaining unit employees." Id. at 40.
The Arbitrator stated that if the Agency had paid detailed employees at the higher rate only for time in excess of 30 days, the Agency should make those affected employees whole for the entire period of the detail "during which the contractual rate for the classification was not forthcoming." Id. The Arbitrator stated that although "[n]ormally a bargaining order would constitute the remedy for this violation by management[,]" such an order "was rendered moot" by the passage of time. Id.
The Arbitrator stated that "a change in the criteria utilized in determining eligibility for promotion to a higher classification within the bargaining unit falls within the category of bargainable issues." Id. at 42. The Arbitrator found, however, that "because it is not clear on this record that the Union has requested, and the Agency has refused, bargaining on its announcement that only graduates of the training program will be considered for promotion to officer ranks, the Award will be framed in terms of requiring the Agency to engage in such bargaining upon request therefor by the Union." Id.
As relevant to the Agency's exceptions, the Arbitrator made the following award:
3 - The Panama Canal Commission did not violate Article XXVI of the labor agreement in failing or refusing to submit implementation of its training program to mid-term bargaining, except as follows:
a. The Commission did violate the wage payment provisions of the labor agreement when it failed and refused to compensate bargaining unit employees who were detailed to fill fire officer ranks for 30 days or less without compensating them at the contractual wage rate mandated for such officer classifications.
4 - The Panama Canal Commission shall make whole each bargaining unit employee who was compensated at less than the mandated contract rate for work performed within any bargaining unit job classification, as described in Article 3 of this Award, and will, for the duration of the instant collective bargaining agreement and any extensions thereof, pay the mandated contract rate for the service described in said Article 3.
. . . .
6 - The Panama Canal Commission shall upon request from the union, bargain with respect to (i) the mid-contract change in the criteria for selection of bargaining unit personnel for promotion to fire officer rank and (ii) its proposed revisions in job descriptions of bargaining unit personnel.
. . . .
Id. at 46-48 (footnote omitted).
In a Supplemental Award, dated October 31, 1989, the Arbitrator clarified, at the Union's request, the award of backpay contained in Article 3a of the award to read as follows:
The Commission did violate the wage payment provision of the labor agreement from and after April 26, 1988 when it failed and refused to compensate bargaining unit employees who were detailed to fill fire officer ranks for 30 days or less without compensating them at the contractual wage rate mandated for such officer classifications (footnote omitted).
Supplemental Award at 4.
III. Exception to the Award of Backpay
A. Positions of the Parties
1. The Agency
The Agency contends that Articles 3 and 4 of the Arbitrator's award, to the extent that they require the Agency to pay employees detailed to vacant fire officer positions for less than 30 days at the rate that they would have received had they been temporarily promoted, conflict with the parties' agreement, agency regulation, and the Back Pay Act.
The Agency maintains that the Arbitrator's award does not contain the required finding under the Back Pay Act that an unjustified or unwarranted personnel action occurred. Moreover, the Agency claims that no unjustified or unwarranted personnel action was committed. The Agency states that "[a]lthough the back pay award is based on the [A]rbitrator's perception that the failure to grant temporary promotions of less than thirty days was a violation of the wage payment and mid-term bargaining provisions of the agreement, this Commission 'failure' was not an unjustified or unwarranted personnel action; in fact it was mandated by Commission regulations which are recognized as controlling by the bargaining agreement." Id. at 6-7.
Noting that the parties' agreement does not contain wage payment provisions, the Agency states that Article III, Section 1 of the parties' agreement provides that "employees are governed by . . . published Commission policies and regulations in existence at the time the agreement was approved[.]" Id. at 7. The Agency points out that its regulation, Panama Canal Personnel Manual (PCPM), Supplement P2, Subchapter 15.5, specifically prevents it from compensating employees for details of 30 days or less. The Agency argues, therefore, that "denial of the higher rate of pay to employees detailed for less than thirty calendar days was in strict compliance with an explicit requirement of an applicable Commission regulation." Id. at 8.
The Agency "concedes that the [A]rbitrator's determination that it violated Article XXVI, Mid-Term Bargaining (a refusal to bargain) would meet the definition of an unwarranted personnel action." Id. at 11. However, the Agency does not concede that its mid-term bargaining obligation was not met. The Agency points out that the Union did not present bargaining proposals and that the Agency regulation, incorporated in the parties' agreement, prohibits temporary promotions for less than 30 days. Id. at 9, n.8.
The Agency also maintains that Articles 3 and 4 of the award are inconsistent with the Back Pay Act because the award does not contain the required finding that "but for" the unwarranted personnel action, the employees would have received the higher wage rate. The Agency contends that in a refusal-to-bargain case, it is difficult to establish that a withdrawal or reduction in pay would not have occurred "but for" the refusal to bargain." Id. at 10-11. The Agency argues that a bargaining order and an award of backpay consistent with the outcome of bargaining is the appropriate remedy for an agency's refusal to bargain in an impact and implementation case. The Agency requests that the award be set aside or modified to provide such a remedy in this case.
2. The Union
The Union maintains that Articles 3 and 4 of the Arbitrator's award are consistent with the Back Pay Act. The Union argues that the Agency's position with regard to the backpay award focuses strictly on the 30-day limit on details contained in the PCPM. However, the Union contends, the point of Article 3 of the award is that the details during the training program were used to avoid paying a higher wage rate. Moreover, the Union points out that the Agency does not take issue with the Arbitrator's finding that the details were used for an improper objective. The Union states that the issue was whether the Agency properly replaced temporary promotions with details consistent with the contract and Federal regulations.
The Union asserts that the Arbitrator's remedy is consistent with the Back Pay Act and argues that the Arbitrator found an unwarranted and unjustified personnel action in the Agency's use of details to avoid paying higher wages to the employees who performed the duties of the vacant fire officer positions. The Union maintains that the requirements for an award of backpay have been met and contends that the Agency misinterprets the award when it argues that Article 3 does not meet the necessary test for an award of backpay under the Back Pay Act. The Union argues that the issue in this case is not one of bargaining in good faith but a matter of failure to compensate employees at the wage rate required by the parties' agreement.
B. Analysis and Conclusions
1. The Award Complies With the Back Pay Act
In order for an award of backpay to be authorized under the Back Pay Act, an arbitrator must find that an agency personnel action was unjustified or unwarranted, that the action directly resulted in the withdrawal or reduction of the grievant's pay, allowances or differentials, and that but for the action, the grievant otherwise would not have suffered the withdrawal or reduction. U.S. Department of Veterans Affairs, Medical Center, Allen Park, Michigan and American Federation of Government Employees, Local 933, 38 FLRA 688 (1990). The Agency argues that the Arbitrator's award is contrary to the Back Pay Act because there was no unjustified or unwarranted personnel action and because the Arbitrator did not make the required finding that "but for" the unwarranted personnel action, the grievants would not have suffered the withdrawal or reduction in pay. We disagree.
The Arbitrator found that by unilaterally changing the past practice of filling vacant positions by promotion and by detailing employees to positions for training purposes without giving them temporary promotions, the Agency violated Article XXVI, Mid-Term Bargaining, of the parties' agreement. Violation of a collective bargaining agreement constitutes an unjustified or unwarranted personnel action under the Back Pay Act and the Arbitrator's determination that the Agency violated the parties' collective bargaining agreement satisfies the requirement for an unjustified or unwarranted personnel action in this case. See U.S. Department of Veterans Affairs, Medical Center, Marion, Illinois and American Federation of Government Employees, Local 2483, 38 FLRA 270, 274 (1990) (Medical Center, Marion) (arbitrator's finding that a detail was improper under the parties' agreement constituted requisite finding under the Back Pay Act that the grievant was affected by an unjustified or unwarranted personnel action); Veterans Administration Medical Center, Palo Alto, California and American Federation of Government Employees, Local 2110, 36 FLRA 98, 108 (1990).
Moreover, the Arbitrator found that "but for" the Agency's failure to bargain over the changes to be made in the promotion policy and the implementation of the new training policy, employees would not have been deprived of the pay to which they were entitled for filling higher level positions. The Arbitrator stated that
[r]educed to its basic elements, the Commission is telling the [U]nion that for a period of 2 1/2 years not only will no bargaining unit employees be promoted to fill a vacancy in a higher classification, but that those same bargaining unit employees will be detailed to perform the duties of the higher classifications. And because of the Commission's identifying such temporary promotions as training devices, the temporarily promoted individuals will not be compensated in accordance with the negotiated wage rates.
Award at 38. Thus, the Arbitrator found that the Agency's decision to change unilaterally the practice of filling vacancies by temporary promotions and instead to use details to vacancies as training devices denied affected employees compensation at higher wage rates. That finding satisfies the requirement of the Back Pay Act that the Agency's unjustified or unwarranted personnel action resulted in the reduction of pay for those employees improperly detailed to higher graded positions. See Medical Center, Marion, 38 FLRA at 274.
Accordingly, we find that the Agency has not shown that the Arbitrator's award fails to meet the requirements of the Back Pay Act.
2. The Award Is Not Contrary To Agency Regulation
An arbitration award will be found to be deficient under section 7122(a)(1) when the award conflicts with a governing agency rule or regulation. U.S. Department of the Army, Fort Campbell District, Third Region, Fort Campbell, Kentucky and American Federation of Government Employees, Local 2022, 37 FLRA 186, 192 (1990) (Fort Campbell). Only an arbitration award that conflicts with a rule or regulation that governs the matter in dispute will be found to be deficient under section 7122(a)(1) of the Statute. Id. Collective bargaining agreements, and not agency rules and regulations, govern the disposition of matters to which they both apply when there is a conflict between the agreement and the rule or regulation. Id. at 194. Nothing in the Statute prevents an agency from agreeing to collective bargaining agreement provisions that modify policies established by an agency rule or regulation and a provision that has become part of a collective bargaining agreement takes precedence over agency rules and regulations with respect to matters to which they both apply. Id.
In this case, there is no provision of the collective bargaining agreement that directly addresses temporary promotions for details. Article XIX of the agreement provides that merit promotion policies will be in accord with the provisions of PCPM Chapter 335. PCPM, Supplement P2, Subchapter 15.5(d) states with regard to temporary promotions that "the minimum period will not be less than 30 calendar days[.]" The Agency contends that that regulation prevents it from compensating employees for details of less than 30 days.
Fort Campbell did not specifically address a situation in which the agency regulation with which the award allegedly conflicts has been incorporated in a collective bargaining agreement. However, consistent with the principles set forth in Fort Campbell, we conclude that inasmuch as the collective bargaining agreement in this case incorporates the regulations contained in PCPM Chapter 335 governing temporary promotions, the matter becomes one of contract interpretation because the agreement, not the regulation, now governs the matter in dispute. Consequently, the issue before us is whether the Arbitrator's award draws its essence from Article XIX, Merit Promotion, of the agreement.
To demonstrate that an award fails to draw its essence from an agreement, a party must show that the award: (1) cannot in any rational way be derived from the agreement; or (2) is so unfounded in reason and fact, and so unconnected with the wording and the purpose of the agreement as to manifest an infidelity to the obligation of the arbitrator; or (3) evidences a manifest disregard for the agreement; or (4) does not represent a plausible interpretation of the agreement. For example, U.S. Department of the Army, Aviation Center, Fort Rucker, Alabama and American Federation of Government Employees, Local 1815, 39 FLRA 1113, 1115 (1991). The Agency has not shown that the Arbitrator's award fails to draw its essence from the parties' agreement under any of the above tests. Rather, the Arbitrator's award constitutes a rational and plausible interpretation of the relevant provisions of the agreement.
In that regard, the Arbitrator did not rule that the Agency must use temporary promotions for filling all vacancies and he did not rule that the Agency could not use details for filling vacancies for less than 30 days. Nor did the Arbitrator hold that the Agency must fill vacancies. Rather, the Arbitrator held only that the Agency violated the parties' collective bargaining agreement, which includes PCPM, Subchapter 15.5, by identifying details as training devices to avoid paying the employees detailed to those positions the pay to which they were otherwise entitled. That is, the Arbitrator found, in effect, that the Agency could not, consistent with the parties' agreement, avoid its contractual obligations under Article XIX by relying on PCPM, Subchapter 15.5. The Arbitrator awarded a make whole remedy for the Agency's violation of the agreement. Based on the Arbitrator's interpretation of the agreement that the Agency should not have used details as training devices, we find nothing in the agreement, including those portions of PCPM, Subchapter 15.5 relating to payment for details, that renders the award deficient. Accordingly, we conclude that the award does not constitute an irrational or implausible interpretation of the parties' agreement.
Also, the Arbitrator held that the use of details in the training program was improper because of the Agency's failure to negotiate over that aspect of implementation of the training program. The Agency has failed to demonstrate that the Arbitrator's award in this respect is irrational or implausible or otherwise fails to draw its essence from the agreement. Instead, the Agency is merely disagreeing with the Arbitrator's interpretation and application of the agreement which provides no basis for finding the award deficient. See U.S. Department of the Navy, Long Beach Naval Shipyard, Long Beach, California and International Federation of Professional and Technical Engineers, Local 174, 37 FLRA 1111, 1120 (1990).
IV. The Exception to the Finding of Failure to Bargain
A. Positions of the Parties
1. The Agency
The Agency contends that article 6(i) and article 6(ii) of the Arbitrator's award are inconsistent with management's rights under section 7106(a) of the Statute. The Agency argues that the award is contrary to law to the extent that it requires the Agency to bargain over the substance of the criteria to be used to select bargaining unit personnel for the training program or the substance of the proposed revisions to job descriptions. The Agency asserts that the content of the training program also concerns the Agency's reserved rights under section 7106(a).
The Agency contends that article 6(i) of the Arbitrator's award, ordering bargaining over changes in criteria for selection of personnel for training, and article 6(ii), ordering bargaining over changes in job descriptions, are inconsistent with management's rights because those portions of the award require action involving substantive matters over which there is no duty to bargain. The Agency maintains that the determination of the knowledge, skills and abilities that management requires for permanent promotion to positions are matters protected by the management rights provisions of the Statute.
2. The Union
The Union contends that the Agency's exception to the Arbitrator's bargaining order contained in Article 6(i) and 6(ii) of the Arbitrator's award is premature. Because bargaining in accordance with the Arbitrator's award could include matters within the Agency's duty to bargain, the Union claims that "[t]here must be a presumption that the award is consistent with applicable law and regulation until such time as the union files proposals which are inconsistent with the Agency's duty to bargain." Opposition at 10. The Union states, therefore, that "[t]o do otherwise, would in fact reject all bargaining including impact and implementation bargaining." Id.
B. Analysis and Conclusions
We conclude that the Agency has failed to demonstrate that the award is deficient on the ground that it is contrary to section 7106(a) of the Statute. Accordingly, we will deny the Agency's exceptions.
The Agency claims that by requiring it to bargain with the Union concerning substantive matters such as the criteria for selection of bargaining unit personnel for training and proposed revisions in the job descriptions of bargaining unit personnel, the award violates management's rights under section 7106(a) of the Statute. According to the Agency, the Arbitrator's award prevents it from determining the particular qualifications and skills needed to perform the work of the positions.
It is well established that management's right to assign work under section 7106(a)(2)(B) of the Statute includes the right to determine the particular duties to be assigned, when work assignments will occur, and to whom or what position the duties will be assigned. See National Association of Government Employees, Local R12-33 and U.S. Department of the Navy, Pacific Missile Test Center, Point Mugu, California, 40 FLRA 479 486 (1991). Moreover, management's right to assign employees encompasses both the right to determine the requirements and qualifications necessary to perform a particular job task and the right to determine which employees meet those qualifications. Proposals which deprive management of this discretion directly interfere with management's right to assign employees under section 7106(a)(2)(A) of the Statute. See American Federation of Government Employees, National Border Patrol Council and National Immigration and Naturalization Service Council and U.S. Department of Justice, Immigration and Naturalization Service, 40 FLRA 521, 531 (1991).
While the Agency does not specifically frame its exceptions in those terms, it is apparent that the Agency considers articles 6(i) and 6(ii) of the award to interfere with its rights to assign work and to assign employees under section 7106(a)(2)(B) of the Statute. However, we do not need to address those arguments because we do not agree that the Arbitrator's award imposes improper requirements on the Agency. The portion of the award to which the Agency excepts states only that the Agency "shall upon request from the [U]nion, bargain with respect to (i) the mid-contract change in the criteria for selection of bargaining unit personnel for promotion to fire officer rank and (ii) its proposed revisions in job descriptions of bargaining unit personnel." Award at 47. In his discussion of the Union's demands regarding promotion qualifications criteria and job descriptions, the Arbitrator concluded that the midterm changes in promotion policy imposed by the Agency must be bargained over at the Union's request. Nothing in the Arbitrator's award requires bargaining in a manner that would interfere with management's rights and the Union has indicated that it interprets the award as requiring bargaining only in a manner consistent with law. We find nothing in that aspect of the award, or the Union's interpretation of the award, that interferes with the Agency's rights under section 7106 of the Statute. Consequently, the Agency's argument presents no basis for concluding that the award is deficient.
Because of the lack of specific proposals by the Union, the Arbitrator framed the award in prospective terms requiring the Agency to bargain on those issues upon request by the Union. We agree with the Union that the Agency's exceptions in this regard are premature. See National Association of Government Employees, Local R1-109 and U.S. Department of Veterans Affairs, Veterans Administration Medical Center, Newington, Connecticut, 35 FLRA 513, 520 (1990). The Union may in the future present proposals on this matter on which the Agency has the duty to bargain or proposals over which the duty to bargain may be unclear. The Agency can at that time challenge proposals over which it believes there is no duty to bargain. Therefore, the Agency's exceptions fail to show that the award is contrary to section 7106(a) of the Statute.
The Agency's exceptions are denied.
(If blank, the decision does not have footnotes.)