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54:0180(23)AR - - Defense Logistics Agency, Defense Distribution Depot, Norfolk, Virginia and IAM Local Lodge 97 - - 1998 FLRAdec AR - - v54 p180

[ v54 p180 ]
The decision of the Authority follows:

54 FLRA No. 23

















May 15, 1998


Before the Authority: Phyllis N. Segal, Chair; Donald S.

Wasserman and Dale Cabaniss, Members.(1)

I. Statement of the Case

This matter is before the Authority on exceptions to an award of Arbitrator Roy D. Cromwell 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 Regulations. The Union filed an opposition to the Agency's exceptions.

The grievance challenged a 10-day suspension. The Arbitrator sustained the grievance in part and denied it in part. As a remedy, the Arbitrator ordered the Agency to destroy the disciplinary record and restore to the grievant lost pay and benefits.

For the following reasons, we remand the case to the parties for resubmission to the Arbitrator for a clarification of the basis for the award.

II. Background and Arbitrator's Award

The grievant, a Material Handler Group Leader, was suspended for 10 days for conduct unbecoming a Federal employee; specifically, for making threatening statements to his supervisor during a telephone call. A grievance was filed and submitted to arbitration on the following stipulated issue:

Was [the] [g]rievant suspended for just cause? If not, what should the remedy be?

Award at 1.

At the arbitration hearing, the grievant testified that he was upset because he had not been immediately informed by his supervisor of an earlier telephone call about his hospitalized daughter. When the call had come in, the supervisor had instructed the employee answering the telephone to take a message and give the message to the grievant when he saw him. According to the Arbitrator, the supervisor testified that when the grievant contacted him, "[t]he supervisor explained his actions and told the grievant that he would do so again." Award at 2. The grievant testified that he told his supervisor that he (the supervisor) "would 'not do it again'"; that "it was not a threat, it was a promise"; and that he was so angry that he had hung up the phone on the supervisor. Id.

The Arbitrator noted that the Union argued that the Agency's actions did not meet "the seven tests [set forth] by Adolph Koven and Susan Smith in the Second Edition, BNA Book, Just Causes, The Seven Tests." Id. However, the Arbitrator adopted a different just cause analysis as the basis for this decision, stating that he found "little fault in applying Arbitrator Daugherty's suggested rules to this case."(2) Id. at 3. The Arbitrator found that: (1) the grievant was a long-term employee with a clean record; (2) the grievant made the alleged remarks to his supervisor; (3) the grievant was aware that as a group leader, he was held to a higher standard than other employees; (4) there was sufficient investigation and proof; (5) there was "fair treatment" of the grievant; and (6) there was not "any good reason to have the behavior of the grievant . . . elevated to this level of discipline[.]" Id. at 3. The Arbitrator also found the grievant was disappointed in not receiving the phone call about his hospitalized daughter. According to the Arbitrator, it appeared that the specific individuals involved, the grievant and his supervisor, had resolved the matter between themselves and did not want to pursue it. He concluded that a "little 'jawing' would probably have solved the matter at the time. . . ." Id. The Arbitrator ruled: "Case reversed without finding fault of either party." Id. He directed the Agency "to purge all records of this incident and to restore lost pay and benefits." Id. As his award, he stated: "[g]rievance sustained and denied in part." Id.

III. Positions of the Parties

A. Agency's Exceptions

The Agency contends that the award violates section 7106(a)(2)(A) of the Statute because it abrogates management's right to discipline.

The Agency also asserts that the award does not draw its essence from the parties' agreement because the Arbitrator's findings are tantamount to a finding of just cause and the contract allows the Agency to suspend an employee for just cause.(3)

B. Union's Opposition

The Union contends that the Arbitrator's award pertains only to this particular incident and does not otherwise affect the Agency's disciplinary actions. According to the Union, the award is based on the testimony of the supervisor as to what his actions would have been if he had known all the facts at the time of the incident.

The Union also asserts that the award is properly based on Article 25, Section 1 of the parties' agreement.(4)

IV. Analysis and Conclusions

Where an agency's exception involves an award's consistency with law, we review the questions of law raised by the agency's exception and the arbitrator's award de novo. See National Treasury Employees Union, Chapter 24 and U.S. Department of the Treasury, Internal Revenue Service, 50 FLRA 330, 332 (1995) (citing U.S. Customs Service v. FLRA, 43 F.3d 682, 686-87 (D.C. Cir. 1994)).

The Authority's framework for resolving exceptions alleging that an award violates management's rights under section 7106 of the Statute is set forth in U.S. Department of the Treasury, Bureau of Engraving and Printing, Washington, D.C. and National Treasury Employees Union, Chapter 201, 53 FLRA 146, 151-54 (1997) (BEP). See U.S. Department of Veterans Affairs Medical Center, Coatesville, Pennsylvania and National Association of Government Employees, Local R3-35, 53 FLRA 1426, 1429 (1998) (VAMC, Coatesville). Under prong I of this framework, the Authority examines whether the award provides a remedy for a violation of either applicable law, within the meaning of section 7106(a)(2) of the Statute, or a contract provision that was negotiated pursuant to section 7106(b) of the Statute. BEP, 53 FLRA at 153. If the award provides such a remedy, the Authority will find that the award satisfies prong I of the framework and will then address prong II. Under prong II, the Authority considers whether the arbitrator's remedy reflects a reconstruction of what management would have done if management had not violated the law or contractual provision at issue. VAMC, Coatesville, 53 FLRA at 1429. If the arbitrator's remedy reflects such a reconstruction, the Authority will find that the award satisfies prong II.

In order to apply the analysis required by this precedent, it is essential to identify the law or contract provision that the Arbitrator determined was violated. Unfortunately, the award in this case is totally devoid of any reference at all to any law or contract provision. Instead, the Arbitrator stated his reliance on "Arbitrator Daugherty's suggested rules[.]" Award at 3.

We recognize that it is possible to speculate that the Arbitrator was, in fact, interpreting and applying a relevant provision of the parties' agreement. As the Union points out, Article 25, Section 1 of the parties' agreement provides that disciplinary action shall be taken for just cause. See Exceptions, Exhibit 7. However, we do not consider it appropriate to speculate in this way. Therefore, we are unable to undertake the analysis required by BEP.(5)

Although we are reluctant to prolong resolution of this dispute, we are unable to resolve the Agency's exception that the award is deficient because it violates management's rights under section 7106(a). Accordingly, we remand the case to the parties for resubmission to the Arbitrator, absent settlement, for a clarification of the basis of the award. See U.S. Department of Defense Dependents Schools and Federal Education Association, 53 FLRA 249, 255 (1997); National Federation of Federal Employees, Local 1442 and U.S. Department of the Army, Letterkenny Army Depot, Chambersburg, Pennsylvania, 46 FLRA 1631 (1993).(6)

V. Decision

This case is remanded to the parties for resubmission to the Arbitrator, absent settlement, for a clarification of the basis of the award.

Dissenting Opinion of Member Wasserman:

I respectfully dissent, because I believe the Arbitrator's decision is clear. He stated that there was no "good reason to have the behavior of [the] grievant . . . elevated to this level of discipline." Award at 3. When read in connection with his findings of fact and analysis, it is evident to me that Arbitrator Cromwell determined that there was no just cause to support the discipline, which is consistent with the parties' collective bargaining agreement.

I believe that we should be cautious in applying our precedent, so as to retain the essential qualities of arbitration that have made it such a useful form of dispute resolution. The majority correctly describes the requirements that we articulated in BEP, namely, that when an agency claims that management rights are implicated by an arbitrator's decision, we look to the two sources of limitations on those rights -- the collective bargaining agreement and applicable law. However, I think it is wrong to apply so rigid a requirement of explicit expression to either prong of the BEP test that a choice of words different from our own would defeat the clearly intended meaning of an award.

In this case, the majority is ordering a remand because the Arbitrator did not cite the portion of the collective bargaining agreement that contains the "just cause" requirement for discipline, nor did he state those precise words. It is also true that the Arbitrator followed a private sector arbitration case for the application of the just cause test. That does not mean that his award was not grounded in or does not enforce a provision of the parties' collective bargaining agreement that constitutes a negotiable matter pursuant to 5 U.S.C. § 7106(b). To the contrary, his entire decision reflects an understanding and application of "just cause," because he does discuss whether the grievant engaged in misconduct and whether the agency responded properly to the grievant's actions in light of the surrounding circumstances.

Moreover, I believe that the analysis under Prong I of the BEP test should be similar to that used when a party claims the award fails to draw its essence from the collective bargaining agreement, which is one of the two exceptions here. To demonstrate that an award fails to draw its essence from the collective bargaining agreement, the appealing party must show that the award: (1) is so unfounded in reason and fact, and so unconnected with the wording and purposes of the agreement, as to manifest an infidelity to the obligation of the arbitrator; or (2) does not represent a plausible interpretation of the agreement; or (3) cannot in any rational way be derived from the agreement; or (4) evidences a manifest disregard of the agreement. U.S. Department of Defense, Dependents Schools and Overseas Education Association, 53 FLRA 196, 208 (1997), citing, United States Department of Labor (OSHA) and National Council of Field Labor Locals, 34 FLRA 573, 575-77 (1990). The Award clearly draws its essence from the parties' agreement, so we may properly infer that Prong I of BEP has been met through the arbitrator's enforcement of the agreement.

The Authority has determined to follow the private sector precedent regarding cases involving an exception on the basis that the award failed to draw its essence from the collective bargaining agreement. With respect to "essence" appeals, the Supreme Court has said:

[T]he arbitrator's award settling a dispute with respect to the interpretation or application of a labor agreement must draw its essence from the contract and cannot simply reflect the arbitrator's own notions of industrial justice. But as long as the arbitrator is even arguably construing or applying the contract and acting within the scope of his authority, that a court is convinced he committed serious error does not suffice to overturn his decision.

United Paperworkers International Union, AFL-CIO v. Misco, Inc., 484 U.S. 29, 38 (1987).

In contrast, here, Prong I of the BEP standard is apparently being intepreted to require the Arbitrator to use certain "magic words" to show that he was applying the "just cause" standard of the contract. That is more than we would require under the essence standard, and it is more than we should be requiring when looking at a claim that management rights have been violated. If we can reasonably construe the arbitrator's award as finding a violation of an enforceable provision of the collective bargaining agreement,(1) we should do so in order to give effect to the obvious intent of the arbitrator. If Prong I is satisfied, then we should go forward to Prong II, the reconstruction of what would have happened in the absence of a violation.

Accordingly, I do not believe there is a need to remand the case. I would simply deny the Agency's exceptions, because the award does draw its essence from the parties' agreement, and it does not abrogate management's right to discipline. In responding to the issue of whether the discipline was for just cause, the Arbitrator determined that the suspension should be rescinded. In his view, the matter should have been handled through counseling,(2) which is equivalent to a reconstruction of what would have happened in the absence of the contract violation.

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

Authority's Footnotes Follow:

1. Member Wasserman's dissenting opinion is set forth at the end of this decision.

2. In Enterprise Wire Co., 46 LA 359, 362-65 (1966), Arbitrator Daugherty set forth seven criteria to determine whether an arbitrator should substitute his judgment for that of an employer in just cause cases arising in the private sector. These criteria are similar to the Douglas factors, applicable in Federal sector just cause cases, set forth in Douglas v. Veterans Administration, 5 MSPR 280, 303 (1981).

3. The Agency also claims that the award "voids Agency policy." Exceptions at 4. This does not appear to be a separate exception and the Agency offers no argument in support of this claim.

4. Article 25, entitled "Disciplinary Action," provides, in relevant part, at Section 1:

Disciplinary action is defined as a letter of reprimand or a suspension of fourteen (14) calendar days or less. . . . Disciplinary actions shall be taken for just cause and will be in accordance with applicable regulations. A supervisor may choose not to take disciplinary action in favor of some form of informal written or verbal warning when the supervisor determines this alternative will accomplish the same purpose as a disciplinary action, that is, to correct the offending employee, maintain morale among other employees and to promote the efficiency of service. . . .

Exceptions, Exhibit 7.

5. Contrary to the suggestion of our dissenting colleague, our decision does not require an arbitrator to use certain "magic words." Rather, our decision requires only that an arbitrator's award be clear as to the basis on which the award is grounded. Unlike our colleague, we do not believe that there is an "obvious intent of the Arbitrator" to which we should give effect.

6. Given this result, it is not necessary for us to consider the second prong of the BEP test. We note that where an arbitrator vacates or mitigates a disciplinary action taken in violation of a contractual just cause provision, that award operates in effect to reconstruct what management would have done had the provision been followed. VAMC, Coatesville, 53 FLRA at 1430. We also note that the Agency raised an essence exception to the Arbitrator's award. However, in light of our determination set forth above, we cannot resolve the essence exception at this time. Thus, this decision does not address the essence exception.

Dissenting Opinion Footnotes Follow:

1. It is well established that "just cause" provisions are enforceable appropriate arrangements. See, e.g., U.S. Department of Veterans Affairs Medical Center, Birmingham, Alabama and American Federation of Government Employees, Local 2207, 51 FLRA 270, 273 (1995).

2. The Arbitrators' conclusion that "[a] little 'jawing' would probably have solved the matter at the time," Award at 3, is consistent with the terms of Article 25, Section 1 of the parties' agreement, which provides for an "informal . . . verbal warning" when it will accomplish the same purpose as discipline. Agency Exceptions, Ex. 7.