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The decision of the Authority follows:
54 FLRA No. 85
FEDERAL LABOR RELATIONS AUTHORITY
AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES
SOCIAL SECURITY ADMINISTRATION
August 31, 1998
Before the Authority: Phyllis N. Segal, Chair; Donald S. Wasserman and Dale Cabaniss, Members.
Decision by Chair Segal for the Authority.
I. Statement of the Case
This matter is before the Authority on exceptions to an award of Arbitrator Bruce Fraser 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 Regulations. The Agency filed an opposition to the Union's exceptions.
The Arbitrator denied a grievance challenging the Agency's decision to reallocate awards in order to comply with revised funding guidelines.
For the reasons that follow, we conclude that the Union has not established that the award is deficient under section 7122(a) of the Statute. Accordingly, we deny the Union's exceptions.
II. Background and Arbitrator's Award
The Union represents Agency employees in field offices throughout New England. The Union is part of AFGE Council 220, which represents Agency employees across the country and is, in turn, party to an AFGE-SSA national agreement.
Article 17, Section 4 of this national agreement provides, in pertinent part, that a responsibility of the parties' National Partnership Council (NPC) is to "[p]rovide timely guidelines and oversight to award panels, including consideration of any funding constraints and budgetary limitations." Exceptions, Attachment 3 at 94-95. Article 17, Section 4 also provides for local, including regional, joint labor/management panels to establish criteria for monetary awards, operating within the parameters of NPC guidelines. In particular, the local panels are authorized to: (1) recommend employees for receipt of Recognition of Contribution (ROC) awards; (2) "[d]ecide on recipients and amounts to be awarded for Commendable Act or Service" awards (CASA) and On-the-Spot (OTS) awards; and (3) grant or recommend to management awards for time-off. Award at 3.
Pursuant to Article 17, Section 4, the NPC provided the local award panels with funding guidelines (hereinafter "original NPC funding guidelines"). As relevant here, the original NPC funding guidelines authorized the local panels to shift funds among award categories, but recommended that no more than 25 percent of certain allocations (ROC and quality step increase (QSI) allocations) be shifted. Applying the original NPC funding guidelines, the Union President and the Agency's Regional Commissioner signed a Memorandum of Understanding (MOU) on May 16, 1996. The parties set $470 as the standard amount for ROC and CASA awards, which required shifting 55 percent of the QSI and ROC funds into the CASA budget. See Exceptions, Attachment 2. The Agency head approved the MOU.
Thereafter, the regional awards panel met and recommended that each of the bargaining unit employees in the region receive an equal ROC or CASA award. One week later, the NPC met and changed its original funding guidelines. The new guidelines (hereinafter "the revised NPC funding guidelines") no longer recommended, but rather required, that "no more tha[n] 25% of funds . . . be transferred from the ROC category to the CASA category . . . ." Award at 7. According to the Arbitrator, the revised NPC funding guidelines specified that "awards in process, but not actually paid to the employee, must be canceled and reconsidered[.]" Id. at 15.
The Regional Commissioner contacted the Union President, seeking to conform the MOU to the revised NPC funding guidelines. The Union President refused, claiming "that the MOU was binding and enforceable and that the NPC guidance to the Region was not timely . . . under Article 17 of the Agreement." Id. at 10. The Regional Commissioner notified the Union that he had three options if the parties did not meet and renegotiate their agreement:
1. Do nothing, and lose the money;
2. Give the award money to area award panels with the caveat that they must follow the [new] NPC guidelines in granting awards; or
3. Give each district manager a budget and direct them to process the awards following the NPC rules.
Id. at 11. The Regional Commissioner rejected option 1 as "patently unfair to the employees." Id. at 17. With respect to option 2, the Regional Commissioner determined that reconvening the award panels "require[d] Union participation which was not forthcoming." Id. When the Union continued to refuse his requests to renegotiate the MOU, the Regional Commissioner selected option 3. As a result, 228 employees did not receive an award.
The Union filed a grievance and the dispute proceeded to arbitration. As relevant here, the Arbitrator framed the issue as follows:(1)
Did the Agency violate the parties' Agreement when it failed to distribute the award allocations in accordance with the May 16 Memo of Understanding . . . ?
If so, what should be the remedy?
Id. at 2.
The Arbitrator found that Article 17, Section 4 of the parties' national agreement "speaks of [the NPC] providing 'timely guidelines and oversight to award panels, including consideration of any funding constraints and budgetary limitations.'" Id. at 16. According to the Arbitrator, when the NPC created the revised NPC funding guidelines, it was acting pursuant to these terms: "providing information about a change in funding constraints." Id. Because the revised NPC funding guidelines applied to employees who had been designated for awards but not paid, the Arbitrator concluded that "the revision was timely and . . . the parties were obligated to rescind all prior awards and follow the revised guidelines." Id. at 16-17. The Arbitrator determined that the Regional Commissioner "acted in good faith and . . . did not violate the parties' [a]greement" when he reallocated the awards. Id. at 18. In the Arbitrator's view, the Regional Commissioner acted reasonably based on both the parties' agreement and the Union's unwillingness "to meet . . . and work out a new MOU." Id. at 17.
Accordingly, the Arbitrator denied this aspect of the grievance.
III. Positions of the Parties
A. Union's Exceptions
The Union challenges the Arbitrator's award on three grounds. First, the Union claims that the award is contrary to law because the Arbitrator should have determined that the parties' MOU, rather than the revised NPC funding guidelines, was controlling. See Exceptions at 10 (citing 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 (1990) (Fort Campbell)). In this regard, the Union claims that "[i]t is an unfair labor practice for an agency to enforce subsequently enacted rules or regulations which conflict with an applicable collective bargaining agreement[.]" Id. at 8 (citing 5 U.S.C. § 7116(a)(7)). The Union claims that the revised NPC funding guidelines are "best characterized as an agency wide 'rule' or 'regulation,'" and, therefore, the NPC funding guidelines cannot control over the parties' MOU. Id. at 9.
Second, the Union argues that the award does not draw its essence from the parties' national agreement because nothing in the contract, MOU, or the revised NPC funding guidelines authorizes management to unilaterally cancel awards as recommended by the awards panel. The Union asserts that Article 17, Section 4 of the parties' national agreement "grants exclusively to Award Panels the power to" recommend employees for ROC awards and to decide the "recipients and amounts to be awarded for CAS[A] and [On-the-Spot] awards, subject to [the] parameters of guidelines provided by the NPC[.]" Id. at 15.
Finally, the Union contends that the Arbitrator's award is based on a nonfact. The Union argues that the revised NPC funding guidelines authorized changes only in the amount of an award not whether an employee would receive an award.
B. Agency's Opposition
The Agency claims that the Union "is attempting to have the FLRA override [the Arbitrator's] rulings and interpretations regarding Article 17 of the new National Agreement between AFGE and SSA." Opposition at 12. The Agency maintains that the Union's exceptions are "just another mechanism for [the Union's] statement that it does not agree with [the Arbitrator's] [a]ward." Id. at 16.
IV. Analysis and Conclusions
A. The Award is Not Contrary to Law
In circumstances where exceptions involve an award's consistency with law, we review the questions of law raised by the exceptions and the 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)). In applying de novo review, the Authority assesses whether an arbitrator's legal conclusions are consistent with the applicable standard of law, based on the underlying factual findings. See National Federation of Federal Employees, Local 1437 and U.S. Department of the Army, Army Research, Development and Engineering Center, 53 FLRA 1703, 1710 (1998). In making that assessment, the Authority defers to the arbitrator's factual findings. See id.
Here, the Union contends that the award is contrary to law because it allows the agency to enforce an agency rule or regulation in a manner that is inconsistent with the parties' MOU and national agreement.(2) It is well established that "nothing in the Statute prevents an agency from agreeing to collective bargaining agreement provisions that alter or modify the policies established by an agency rule or regulation . . . ." Fort Campbell, 37 FLRA at 194. For this reason, a collective bargaining agreement, and not an agency regulation, will govern the disposition of matters to which they both apply. See id. In addition, where an agency regulation with which an award allegedly conflicts has been incorporated in a collective bargaining agreement, the interpretation and application of the regulation is an issue of contract interpretation. See Panama Canal Commission and International Association of Firefighters, Local 13, 41 FLRA 284, 292-93 (1991) (Panama Canal Commission).
The Union argues that the revised NPC funding guidelines constitute an agency rule or regulation and, therefore, the MOU -- and not the revised NPC funding guidelines -- governs the disposition of the grievance. However, even assuming that the revised NPC funding guidelines constitute agency rules or regulations, the award reflects that the guidelines were incorporated into the parties' MOU and national agreement. In this regard, the parties' MOU states that it "outlines [the] implementation of Article 17 of the negotiated agreement[,]" which, as interpreted by the Arbitrator, provides that awards are to be handled in accordance with the funding guidelines issued by the NPC. See Exceptions, Attachment 2 at 1. As such, the parties' MOU and national agreement incorporate the revised NPC funding guidelines, and the Union's exception that the award enforces an Agency regulation in violation of the parties' agreement does not demonstrate that the award is deficient. See Panama Canal Commission, 41 FLRA at 293-94.
Based on the foregoing, we conclude that the award is not deficient under section 7122(a)(1) of the Statute, and we deny this exception.
B. The Award Does Not Fail to Draw its Essence From the Parties' Agreement
The Union asserts that the plain wording of Article 17, Section 4 of the parties' national agreement expressly grants to award panels the "exclusive" power to determine which employees will receive awards. As plainly worded, however, Article 17, Section 4 states that the NPC will "[p]rovide timely guidelines and oversight to award panels, including consideration of any funding constraints and budgetary limitations" and that award panels will "[o]perate within the parameters of guidelines provided by the NPC." Exceptions, Attachment 3 at 94-95. Nothing in Article 17, Section 4 either expressly or implicitly provides that award panels have the exclusive power to determine which employees will receive awards. Because the wording of Article 17, Section 4 of the parties' agreement does not exclusively limit the power of recommending or deciding which employees will receive awards, it was not irrational, implausible, or unconnected to the wording of the agreement for the Arbitrator to have determined that the Regional Commissioner acted properly when he reallocated the awards consistent with the revised NPC funding guidelines. See United States Department of Labor (OSHA) and National Council of Field Labor Locals, 34 FLRA 573, 577 (1990).
Moreover, contrary to the Union's assertion, neither the parties' MOU nor the revised NPC funding guidelines require the payment of awards to employees chosen or recommended by the award panel. Rather, the MOU provides that "[m]anagement agrees to notify the union and consult prior to any re-allocation of funds within the region." Exceptions, Attachment 2 at 1. In addition, the revised NPC funding guidelines state that "adjustments will be made administratively . . . or, at the option of the panel, the panel can reconvene . . . [a]wards in process, but not actually paid . . . must be canceled and reconsidered." Award at 7-8. Nothing in the revised NPC funding guidelines grants an award to each employee. The Arbitrator determined that the Regional Commissioner's unilateral action of reallocating the awards resulted from the Union's refusal to meet and reconsider the awards. See id. at 17. Thus, it was not irrational, implausible, or unconnected to the wording of the parties' MOU or the revised NPC funding guidelines for the Arbitrator to have determined that the initial award panel's action, recommending an award to each employee, was superseded by the revised NPC funding guidelines, requiring an adjustment of the awards recommended but not paid. See DOL, 34 FLRA at 577.
Based on the foregoing, the Union has not demonstrated that the Arbitrator's award fails to draw its essence from the parties' national agreement, MOU, or revised NPC funding guidelines. Accordingly, we deny this exception.
C. The Award is Not Based on a Nonfact
To establish that an award is based on a nonfact, the appealing party must demonstrate that the central fact underlying the award is clearly erroneous, but for which a different result would have been reached by the arbitrator. U.S. Department of the Air Force, Lowry Air Force Base, Denver, Colorado and National Federation of Federal Employees, Local 1497, 48 FLRA 589, 593 (1993). However, the Authority will not find an award deficient on the basis of an arbitrator's determination on any factual matter that the parties disputed at arbitration. Id. at 594 (citing Mailhandlers v. Postal Service, 751 F.2d 834, 843 (6th Cir. 1985)). In addition, an arbitrator's conclusion that is based on an interpretation of the parties' collective bargaining agreement does not constitute a fact that can be challenged as a nonfact. See National Labor Relations Board and National Labor Relations Board Professional Association, 50 FLRA 88, 92 (1995) (NLRB Professional Association).
The Union asserts that the Arbitrator's conclusion that the revised NPC funding guidelines authorized the Regional Commissioner to reallocate the awards is a nonfact because the NPC authorized changes only in the amount of an award that an employee would receive, not whether an employee would receive an award. See Award at 14-16. The Arbitrator's conclusion that the Regional Commissioner was authorized to reallocate the awards resulted from the Arbitrator's interpretation of the parties' national agreement. Therefore, it does not constitute a fact that can be challenged as a nonfact. See NLRB Professional Association, 50 FLRA at 92; see also U.S. Department of the Navy, Naval Training Center, Orlando, Florida and International Union of Operating Engineers, Local 673, 53 FLRA 103, 106 (1997); U.S. Department of the Air Force, San Antonio Air Logistics Center, Kelly Air Force Base, Texas and American Federation of Government Employees, Local 1617, 51 FLRA 1624, 1630 (1996). Accordingly, we deny this exception.
The Union's exceptions are denied.
1. The Arbitrator also addressed a second issue concerning awards for union officials. As the exceptions do not challenge this aspect of the award, we do not address it.
2. As set forth above, the Union also asserts that the award is contrary to section 7116(a)(7) of the Statute, which provides that it is an unfair labor practice for an agency "to enforce any rule or regulation . . . which is in conflict with any applicable collective bargaining agreement if the agreement was in effect before the date the rule or regulation was prescribed." 5 U.S.C. § 7116(a)(7). The record in this case does not indicate that the Union argued to the Arbitrator that the Agency's actions constituted an unfair labor practice. Accordingly, pursuant to section 2429.5 of the Authority's Regulations, we will not consider this argument.