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The decision of the Authority follows:
44 FLRA No. 53
FEDERAL LABOR RELATIONS AUTHORITY
U.S. DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
SPRINGFIELD DISTRICT OFFICE
NATIONAL TREASURY EMPLOYEES UNION
March 26, 1992
Before Chairman McKee and Members Talkin and Armendariz.
I. Statement of the Case
This matter is before the Authority on an exception to an award of Arbitrator Robert W. McAllister filed by the Union 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 Agency filed an opposition to the Union's exception.
The Union filed a grievance alleging that the Agency violated the parties' collective bargaining agreement by refusing to comply with a provision concerning the issuance of performance awards to seasonal employees. The Arbitrator found that the provision was not enforceable and denied the grievance. For the following reasons, we conclude that the award must be remanded to the parties for resubmission to the Arbitrator.
II. Background and Arbitrator's Award
The parties signed a Memorandum of Agreement, which provides in pertinent part:
Seasonal, intermittent, and part-time temporary bargaining unit members can qualify for . . . and receive a mandatory performance award. . . . 90-day release/recall appraisals will serve as the governing document for these employees.
Employees who receive a pro-rated . . . award for a portion of the rating period will not also be eligible for a full . . . award based on the annual rating of record. . . .
Award at 5.
The Agency head disapproved this provision pursuant to section 7114(c)(2) of the Statute. However, because the disapproval was not timely served on the Union, the provision became effective 30 days after the execution of the agreement. Thereafter, the Agency refused to comply with the provision and the Union filed a grievance. When the grievance was not resolved, it was submitted to arbitration on the following stipulated issue:
Is the Memorandum of Agreement between the Springfield District and the National Treasury Employees Union, Chapter 43, dated November 8, 1989, enforceable: If so, what is the remedy?
The Arbitrator stated that 5 C.F.R. § 430.503(b)(1) requires performance awards to be based on ratings of record. The Arbitrator determined that the release/recall evaluations referenced in the disputed provision did not constitute ratings of record under 5 C.F.R. § 430.206(c)(2) because they did not "provide for" higher level review. Id. at 14. The Arbitrator noted that although seasonal employees received other performance appraisals, that included second-level review, such appraisals were provided only after 1 year of accumulated service. According to the Arbitrator:
The release/recall evaluation, as it presently exists, does not satisfy the regulatory requirements of a rating of record because it does not provide for a second level review. Consequently, the regulations do not permit its use as the basis for performance awards. As long as the release/recall evaluation is not a rating of record, the disputed provision would be contrary to a government[-]wide regulation and, therefore, unenforceable.
The Arbitrator rejected the Union's argument that the Agency could take steps to make the release/recall evaluation a rating of record:
While this may be true, the terms of the [parties' agreement] do not require the Agency to make such changes. Further, it is beyond the scope of the Arbitrator's authority to direct the Agency to make the changes. While the parties could have negotiated to make the release/recall evaluation a rating of record if it covered a minimum of ninety days, they did not do so. Without such an agreement, the nature of the evaluation remains unchanged.
Id. Based on these conclusions, the Arbitrator denied the grievance.
III. Positions of the Parties
A. Union's Exception
The Union argues that the award conflicts with 5 C.F.R. § 430.206(c). The Union asserts that the Agency could comply with both the agreement and the regulation by subjecting release/recall appraisals to higher level review. According to the Union, the Agency "is already obligated to engage in the higher level review by agreeing to the provision at issue." Exception at 13.
B. Agency's Opposition
The Agency asserts that the award should be upheld because it is based on the Arbitrator's interpretation of the parties' agreement. The Agency maintains that "the parties did not negotiate provisions to change the release/recall evaluations to ratings of record and the Arbitrator had no independent authority" to order the Agency to do so. Opposition at 11.
IV. Analysis and Conclusions
We are unable to determine whether the award is deficient. We note two things.
First, there is no dispute that, under applicable regulations, performance awards may be based only on ratings of record and, further, that appraisals must be subject to higher level review to constitute ratings of record. However, it is not argued or apparent that the regulations require contract provisions specifically to include such review. Put differently, we have no basis on which to conclude that the disputed provision would be enforceable only if it expressly stated that release/recall evaluations were subject to higher level review. Instead, to determine whether the disputed provision conflicts with applicable regulations, the appropriate inquiry is whether the contract provision precludes such review. See U.S. Department of Defense, Defense Contract Audit Agency, Central Region and American Federation of Government Employees, Local 3529, 37 FLRA 1218, 1226-29 (1990) (Defense Contract Audit Agency) (award enforcing provisions of a collective bargaining agreement and agency regulations in conflict with 5 C.F.R. § 430.206(c) found deficient). See also National Treasury Employees Union and U.S. Department of Commerce, Patent and Trademark Office, Arlington, Virginia, 40 FLRA 3, 9 (1991) (Patent and Trademark Office), aff'd mem. sub nom. National Treasury Employees Union v. FLRA, No. 91-1262 (D.C. Cir. Mar. 20, 1992) (proposal precluding higher level review and disapproval of performance awards by the agency found to be inconsistent with 5 C.F.R. § 430.503(c)).
Second, there also is no dispute that release/recall evaluations are not now subject to higher level review. However, the award is unclear as to whether the disputed provision precludes higher level review of the evaluations. The Arbitrator stated that the provision conflicted with 5 C.F.R. § 430.206(c) because it did not "provide for" higher level review. Award at 14. It appears from this statement that the Arbitrator found the provision unenforceable because it did not expressly include higher level review. As noted previously, this finding would not support a conclusion that the provision conflicted with the regulation. See Defense Contract Audit Agency; Patent and Trademark Office. On the other hand, the Arbitrator also stated that "[w]hile the parties could have negotiated to make the release/recall evaluation a rating of record . . . they did not do so." Award at 14. It appears from this statement that the Arbitrator interpreted the parties' agreement as precluding higher level review. If so, the award is deficient only if it fails to draw its essence from the parties' agreement, an argument not made in the record before us.
Having considered the record as a whole, we are unable to determine whether the Arbitrator's conclusion that the disputed provision is unenforceable is based on the provision's silence with respect to higher level review or on the parties' agreement that there would be no higher level review. Because we are unable to determine the basis of the award, we will remand this case to the parties for resubmission to the Arbitrator.
The case is remanded to the parties for resubmission to the Arbitrator in accordance with this decision.
(If blank, the decision does not have footnotes.)
1. 5 C.F.R. § 430.503(b) provides, in pertinent part:
An award . . . shall be based on the employee's rating of record for the current appraisal period for which performance awards are being paid.
2. 5 C.F.R. § 430.206(c) provides, in pertinent part:
Ratings of record . . . shall be reviewed and approved by a person(s) at a higher level in the organization than . . . the appraising official.