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60 FLRA No. 1
OF GOVERNMENT EMPLOYEES,
SOCIAL SECURITY ADMINISTRATION
June 3, 2004
Before the Authority: Dale Cabaniss, Chairman, and
Carol Waller Pope and Tony Armendariz, Members
I. Statement of the Case
This matter is before the Authority on exceptions to an award of Arbitrator Lloyd L. Byars filed by the Union and the Agency under § 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, but the Union did not file an opposition to the Agency's exception.
The Arbitrator sustained a grievance alleging that the Agency violated the collective bargaining agreement by failing to properly grant priority consideration to the grievants.
For the following reasons, we remand the award to the parties, absent settlement, for resubmission to the Arbitrator for clarification of the award.
The Agency issued a vacancy announcement for a newly created position, Social Insurance Specialist (TE), GS-105-12. Award at 2. The Union filed a grievance alleging that the Agency failed to properly grant nine employees priority consideration for the vacancies. Id. The parties were not able to resolve the grievance and the matter was submitted to arbitration.
The Agency first argued that the grievance was not arbitrable because under the parties' agreement, the Union could only "conduct audits of promotion packages . . . when it has reason to believe a discrepancy exists or when requested to do so by an employee." See id. at 3. According to the Agency, there was no evidence that an employee requested the audit or that the Union had any reason to believe a "discrepancy" existed merely based on its suspicion that "there were problems." Id. The Agency also contended that the Union did not invoke arbitration in a timely manner. Id. at 4.
The Agency next asserted that one grievant's presence at the hearing, in order to testify, was unreasonable because she had no "direct knowledge" of the selection process of any other grievant and did not provide any relevant testimony. Id. at 4-5. Thus, according to the Agency, the Union was responsible for those costs under the terms of the agreement. Id. at 5.
On the merits, the Agency argued that all of the grievants were properly afforded priority consideration for the positions. Award at 5. The Agency contended that priority consideration requires "a bona fide consideration" and that the Union must prove that the grievants did not receive such consideration. [n1] Id.
The Union argued that the grievance was arbitrable and that nothing prohibits an employee from filing an individual grievance and being party to a larger Union grievance. Award at 6. In addition, the Union asserted that it invoked arbitration in a timely manner and that the agreement allows the Union to file a grievance involving a continuing practice at any time. Id. at 7.
As to the one contested grievant's presence, the Union contended that the testimony from one grievant illustrated the Agency's continuing violation of the agreement, and thus, the Agency was responsible for the costs. Id.
On the merits, the Union stated that priority consideration is awarded to "correct a prior selection violation by the Agency[.]" Id. According to the Union, priority consideration requires the Agency to grant employees "prior and separate consideration before any other candidates on the well-qualified list" and prohibits the Agency from comparing employees exercising priority consideration with other candidates. Id. at 7, 8-9. The Union argued that the Agency does not need to automatically select an employee who is exercising priority consideration, but that the employee should be selected if there are no deficiencies in his/her record. Id. at 8. [ v60 p2 ]
The Union alleged that the Agency impermissibly compared some of the grievants to other candidates on the well-qualified list who did not exercise priority consideration. Id. at 9. The Union contended that the Agency should have selected the grievants for the positions because all of the grievants were minimally qualified and had exercised their right to priority consideration. Id.
The Union requested, for each grievant, a retroactive temporary promotion with back pay and interest from the time the grievant would have been selected. Id. at 10-11. For one of the grievants, the Union requested "the pay differential for money expended on a hardship transfer[.]" Id. at 11. Finally, the Union requested that the Arbitrator award reasonable attorney fees. Id.
Because the parties could not agree on the framing of the issues, the Arbitrator framed the issues as: "Is the Grievance arbitrable? Is [one grievant's] appeal properly included in the Grievance? Is the Agency required to [bear] the costs for [a grievant's] participation in the arbitration hearing? Did the Agency violate Article 26, Section 13 of the National Agreement, and, if so, what is the remedy?" See Award. at 2-3.
After determining that the grievance was arbitrable, the Arbitrator considered the merits of the grievance. The Arbitrator pointed out that both parties agreed that the Agency is required to give an employee who exercises priority consideration "bona fide consideration" before the competitive process occurs. Id. at 12-13. The Arbitrator concluded that "bona fide consideration" meant the Agency must select an employee who is qualified for a position and exercises priority consideration for that position unless the selecting official can justify the non-selection. Id. at 13. According to the Arbitrator, the Agency must do more than merely assert that it considered the candidate. Id.
The Arbitrator found that the Agency did not present any valid justification for not selecting the grievants who exercised priority consideration. [n2] Id. at 13, 14-15. The Arbitrator also determined that the Agency's ultimate selection of some of the grievants illustrated that they were qualified to be selected through priority consideration and were not properly afforded priority consideration. Id. at 14-15.
The Arbitrator determined that the grievant who testified at the hearing provided valuable evidence and denied the Agency's request for reimbursement for the costs of that grievant testifying at the hearing. Id. at 15.
The Arbitrator, based on a finding that the Agency violated Article 26, Section 13 of the agreement, awarded seven of the grievants retroactive promotions with back pay and interest from the time each of them would have been selected/promoted. Id. at 16. The Arbitrator also ordered that one of the grievants "be made whole for the pay differential for money expended on a hardship transfer[.]" See id. at 16. Finally, the Arbitrator denied the Union's request for attorney fees. Id. at 17.
III. Positions of the Parties
A. Union's Exceptions
The Union argues that the Arbitrator's denial of attorney fees violates the Back Pay Act, 5 U.S.C. § 5596, and the Civil Service Reform Act of 1978, 5 U.S.C. § 7701(g). [n3] Union Exceptions at 1. The Union contends that the requirements for an award of attorney fees have been met, and therefore the Union is entitled to those fees. Id. at 2-3. The Union alleges that because the violation of the agreement was an "unjustified or unwarranted personnel action," the grievants were the prevailing party and were awarded back pay to correct that action, it is entitled to attorney fees. See id. at 3.
The Union argues that an award of attorney fees is "in the interest of justice" because five of the Allen factors have been met, even though satisfying only one of the Allen factors would justify attorney fees. [n4] Union [ v60 p3 ] Exceptions at 3-4. The Union contends that the Agency must have been aware that it would not prevail on the merits because it only called two factual witnesses and did not call any expert witnesses. Id. at 4. In addition, the Union argues that the Agency exhibited bad faith during the hearing and attempted to dispose of the case by raising the issue of arbitrability. Id. The Union also asserts that the Agency engaged in a continuing violation which "created a long drawn out protracted grievance process, [causing] the grievants to be severely prejudiced . . . ." Id. Finally, the Union argues "[t]he service [rendered] to the Federal work force would be for the Agency to discontinue a practice that so adversely affects employees. . . ." See id.
B. Agency's Opposition
The Agency contends that attorney fees are not warranted in this case. Opposition at 3. The Agency claims that an arbitrator has "great latitude in fashioning remedies" and "substantial discretion in determining when an award of fees is warranted." See id. at 3-4. According to the Agency, an arbitrator has the discretion to deny attorney fees under the Back Pay Act based on the use of the word "may" in the Statute. Id. at 4 (citing 5 U.S.C. § 7701(g)(1)).
The Agency does not contest that the Union was the prevailing party, but asserts that an award of attorney fees must be "in the interest of justice" and that the Union did not provide any support for its allegation that five of the Allen factors were met. Id. at 4-5. In addition, the Agency alleges that the Arbitrator did not make any findings that the Allen factors were met. Id. at 5. According to the Agency, the Arbitrator did not find that the Agency engaged in a "prohibited personnel practice," prolonged the proceedings though a procedural error, acted in bad faith or "exert[ed] improper pressure on the employee[s] to act in certain ways[.]" Opposition at 5. Finally, the Agency contends that it proceeded with the arbitration because it believed its actions were warranted and did not know it would not prevail on the merits. Id.
C. Agency's Exceptions
The Agency argues that the Arbitrator erred in ordering that one of the grievants "be made whole for the pay differential for money expended on a hardship transfer." Agency Exceptions at 2. The Agency asserts that this part of the award is contrary to the Back Pay Act and is not authorized under 5 U.S.C. §§ 5724 and 5724(a). [n5] Id. at 2-3.
The Agency, acknowledging that the government may be responsible, under 5 U.S.C. §§ 5724 and 5724(a), for paying the relocation expenses of an employee relocated "in the interest of the Government[,]" maintains that the grievant was not relocated "in the interest of the government," but was relocated for her own convenience. [n6] Id. at 3-4. The Agency alleges that after the grievant was not selected for the vacancy, she requested, and was granted, a relocation that was primarily for her convenience. Id.
The Agency also argues that the Arbitrator's award does not constitute a remedy under the Back Pay Act because reimbursement for relocation expenses does not constitute "pay, allowance, or differential[.]" Id. at 4. The Agency does not dispute the Arbitrator's finding that an unjustified or unwarranted personnel action occurred but argues that under the Back Pay Act, an employee who has suffered an unwarranted personnel action is entitled only to "pay, allowances or differentials" which the employee would have earned "as part of the regular compensation for performing his job" had the unwarranted personnel action not occurred. Id. at 4-6, 7 (citing Social Security Admin. v. FLRA, 201 F.3d 465 (D.C. Cir. 2000); Hurley v. United States, 624 F.2d 93 (10th Cir. 1980); Morris v. United States, 595 F.2d 591 (Ct. Cl. 1979); Community Servs. Admin., 7 FLRA 206 (1981); unpublished Comptroller General decision No. B-223306 (October 23, 1986)). According to the Agency, the Back Pay Act does not authorize liquidated damages or reimbursement for per diem or commuting expenses, even if the expenses resulted from an unwarranted personnel action. Agency Exceptions at 6-7.
The Union did not file an opposition to the Agency's exception.
IV. Analysis and Conclusions
The Union argues that the Arbitrator's denial of attorney fees is contrary to the Back Pay Act. When a party's exceptions involve an award's consistency with law, the Authority reviews the question of law and the arbitrator's award de novo. NTEU, Chapter 24, 50 FLRA 330, 332 (1995) (citing United States Customs Serv. v. FLRA, 43 F.3d 682, 686-87 (D.C. Cir. 1994)). In applying a de novo standard of review, the Authority assesses whether the arbitrator's legal conclusions are [ v60 p4 ] consistent with the applicable standard of law. See NFFE, Local 1437, 53 FLRA 1703, 1710 (1998). In making that assessment, the Authority defers to the arbitrator's underlying factual findings. Id.
The threshold requirement for an award of attorney fees under the Back Pay Act is a finding that the grievant was affected by an unjustified or unwarranted personnel action, which resulted in the withdrawal or reduction of the grievant's pay, allowances, or differentials. See NAGE, Local R4-6, 54 FLRA 1594, 1597-98 (1998) (Fort Eustis); United States Dep't of Defense, Defense Distribution Region East, New Cumberland, Pa., 51 FLRA 155, 158 (1995). The Act further requires that an award of attorney fees must be: "(1) in conjunction with an award of backpay to the grievant on correction of the personnel action; (2) reasonable and related to the personnel action; and (3) in accordance with the standards established under 5 U.S.C. §§ 7701(g), which pertains to attorney fee awards by the Merit Systems Protection Board." Fort Eustis, 54 FLRA at 1598. The standards established under 5 U.S.C. § 7701(g)(1), which apply in all cases except those involving allegations of discrimination, are as follows: "(1) the employee must be the prevailing party; (2) the award of fees must be warranted in the interest of justice; (3) the amount of the fees must be reasonable; and (4) the fees must have been incurred by the employee." See id. (citing AFGE, Local 12, 38 FLRA 1240, 1248 (1990)).
The Arbitrator did not articulate the reasons for denying the Union's request for attorney fees and the record, as submitted to the Authority, does not contain any evidence that would assist the Authority in determining the Arbitrator's basis for denying the Union's request for attorney fees. Award at 17. The Authority's approach to attorney fees awards under the Back Pay Act that are not sufficiently explained is to "take the action necessary to assure that the award is consistent with applicable statutory standards." See United States Dep't. of Agric., Animal and Plant Health Inspection Serv., Plant Prot. and Quarantine, 53 FLRA 1688, 1695 (1998) (citing NAGE, Local R5-188, 46 FLRA 458 (1992)). The Arbitrator did not address whether the fees as requested were "warranted in the interest of justice," were reasonable, or were incurred by the employee. Award at 17. Because the Arbitrator has not sufficiently explained the "determination of a pertinent statutory requirement" and the record does not permit the Authority to resolve the Union's exception, this portion of the award is remanded to the parties, absent settlement, for resubmission to the Arbitrator to clarify the reasons for the denial of attorney fees. Id.
The Arbitrator also did not specify the basis and rationale for ordering that one grievant "be made whole for the pay differential for money expended on a hardship transfer," the remedy provided in the award. Under 5 U.S.C. §§ 5724 and 5724(a), the government is responsible for paying the relocation expenses of an employee who is relocated "in the interest of the government" but is not responsible for relocation expenses of an employee who is relocated for his/her own convenience. See National Air Traffic Controllers Assoc., 54 FLRA 706, 712-13 (1998). In the absence of any statement by the Arbitrator articulating the basis and rationale for awarding that remedy, the legality of the award cannot be ascertained. Consequently, that portion of the award must also be remanded to the parties, absent settlement, for resubmission to the Arbitrator to clarify the basis and rationale for this remedy.
We remand the award to the parties, absent settlement, for resubmission to the Arbitrator for clarification of his award, consistent with this decision.
5 U.S.C. § 5596
(b)(1) An employee of an agency who, on the basis of a timely appeal or an administrative determination (including a decision relating to an unfair labor practice or a grievance) is found by appropriate authority under applicable law, rule, regulation, or collective bargaining agreement, to have been affected by an unjustified or unwarranted personnel action which has resulted in the withdrawal or reduction of all or part of the pay, allowances, or differentials of the employee--
(A) is entitled, on correction of the personnel action, to receive for the period for which the personnel action was in effect --
(i) an amount equal to all or any part of the pay, allowances, or differentials, as applicable which the employee normally would have earned or received during the period if the personnel action had not occurred, less any amounts earned by the employee through other employment during that period; and [ v60 p 5 ]
(ii) reasonable attorney fees related to the personnel action which . . . shall be awarded in accordance with standards established under section 7701(g) of this title . . . .
5 U.S.C. § 7701(g)
(g)(1) [E]xcept as provided in paragraph (2) of this subsection, the Board, or an administrative law judge or other employee of the Board designated to hear a case, may require payment by the agency involved of reasonable attorney fees incurred by an employee or applicant for employment if the employee or applicant is the prevailing party and the Board, administrative law judge, or other employee (as the case may be) determines that payment by the agency is warranted in the interest of justice, including any case in which a prohibited personnel practice was engaged in by the agency or any case in which the agency's action was clearly without merit.
5 U.S.C. § 5724
(a) Under regulations prescribed under section 5738 of this title and when the head of the agency concerned or his designee authorizes or approves, the agency shall pay from Government funds--
(1) the travel expenses of an employee transferred in the interest of the Government from one official station or agency to another for permanent duty, and the transportation expenses of his immediate family, or a commutation thereof under section 5704 of this title.
. . . .
(h) When a transfer is made primarily for the convenience or benefit of an employee, including an employee in the Foreign Service of the United States, or at his request, his expenses of travel and transportation and the expenses of transporting, packing, crating, temporarily storing, draying, and unpacking of household goods and personal effects may not be allowed or paid from Government funds.
5 U.S.C. § 5724a
(a) [A]n agency shall pay to or on behalf of an employee who transfers in the interest of the Government, a per diem allowance or the actual subsistence expenses, or a combination thereof, of the immediate family of the employee for en route travel of the immediate family between the employee's old and new official stations.
. . . .
(d)(1) [A]n agency shall pay to or on behalf of an employee who transfers in the interest of the Government, expenses of the sale of the residence (or the settlement of an unexpired lease) of the employee at the old official station and purchase of a residence at the new official station that are required to be paid by the employee, when the old and new official stations are located within the United States.
. . . .
(f)(1) [A]n employee who is reimbursed under subsections (a) through (e) of this section or section 5724(a) of this title is entitled to an amount for miscellaneous expenses--
(A) not to exceed two weeks' basic pay, if such employee has an immediate family; or
(B) not to exceed one week's basic pay, if such employee does not have an immediate family. . . .
Footnote # 1 for 60 FLRA No. 1 - Authority's Decision
The Agency disagreed with the Union's assertion that priority consideration required a selecting official to select an employee who exercised priority consideration but is minimally qualified. Award at 5.
Footnote # 2 for 60 FLRA No. 1 - Authority's Decision
Footnote # 3 for 60 FLRA No. 1 - Authority's Decision
Footnote # 4 for 60 FLRA No. 1 - Authority's Decision
See Allen v. United States Postal Serv., 2 M.S.P.R. 420 (1980) (Allen). According to Allen, an award of attorney fees is warranted in the interest of justice if: (1) the agency engaged in a prohibited personnel practice; (2) the agency actions are clearly without merit or wholly unfounded, or the employee is substantially innocent of charges brought by the agency; (3) the agency actions are taken in bad faith to harass or exert improper pressure on an employee; (4) the agency committed gross procedural error which prolonged the proceeding or severely prejudiced the employee; or (5) the agency knew or should have known it would not prevail on the merits when it brought the proceeding. The Authority has also stated that an award of attorney fees is warranted in the interest of justice when there is either a service rendered to the Federal workforce or there is a benefit to the public derived from maintaining the action. United States Dep't of the Army, Red River Army Depot, Texarkana, Tex., 39 FLRA 1215, 1223 (1991) (citing Naval Air Dev. Ctr., Dep't of the Navy, 21 FLRA 131, 139 (1986)).
Footnote # 5 for 60 FLRA No. 1 - Authority's Decision
Footnote # 6 for 60 FLRA No. 1 - Authority's Decision
Under the relevant statutes, relocation expenses include, amongst other things, travel expenses, transportation expenses, per diem allowance or actual subsistence expenses and miscellaneous expenses. 5 U.S.C. §§ 5724 and 5724(a).