U.S. Federal Labor Relations Authority

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United States, Department of Veterans Affairs, Veterans Integrated, Service Network 7, Network Business Office, Duluth, Georgia (Agency) and American Federation of Government Employees, Local 217 (Union)

[ v60 p122 ]

60 FLRA No. 28







August 10, 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 an exception to an award of Arbitrator D. L. Howell filed by the Agency under § 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 exception.

      The Arbitrator found that the Agency violated the parties' collective bargaining agreement by failing to create a panel for determining performance awards. As a remedy, the Arbitrator ordered the Agency to comply with the parties' agreement and he awarded the Union attorney fees. For the reasons that follow, we set aside the Arbitrator's award of attorney fees.

II.     Background and Arbitrator's Award

      A grievance was filed alleging that the Agency awarded employees performance awards without establishing an awards panel that included a Union representative for determining those awards, as required by Article 15 of the parties' agreement. [n1]  When the grievance was not resolved, the matter was submitted to arbitration and the Arbitrator framed the issues as follows:

Is the subject grievance arbitrable?
Did the Agency violate the Master Agreement and/or Memorandum of Understanding . . . when management issued awards to . . . bargaining unit employees located at the VA Medical Center in Augusta, Georgia; and did the Agency follow the grievance procedure as outlined in the Master Agreement? If so, what should be the remedy?

Award at 2.

      Initially, the Arbitrator noted that the Agency "recognize[d] that the correct procedure was not followed" in granting the performance awards at issue. Id. at 12. In this regard, the Arbitrator explained that Article 15, Section 4 of the parties' agreement sets forth the procedure that should have been followed. As that procedure was not followed, the Arbitrator determined that the Agency violated the parties' agreement.

      In determining the appropriate remedy for the Agency's violation, the Arbitrator denied the Union's request to grant all employees in the affected unit a performance award equal to the highest award previously distributed. In this regard, the Arbitrator found that such a remedy was inconsistent with Article 15 of the parties' agreement, which he found permitted awards based only on "achievement and improvement." Id. at 16. Instead, the Arbitrator ordered the Agency to immediately establish an awards panel, consistent with Article 15 of the parties' agreement, in order to establish fair and equitable mission-related criteria for awards. The Arbitrator also ordered that, "under the provisions of Article 40, Section 2(G) [of the parties' agreement,] the Agency shall pay `reasonable legal fees' incurred by the Union in processing the . . . grievance[.]" [n2] Id  at 17 [ v60 p123 ]

III.     Positions of the Parties

A.     Agency's Exception

      The Agency's sole exception alleges that the award is contrary to law because the Arbitrator awarded attorney fees pursuant to the parties' agreement and not pursuant to any statutory authorization for such fees. The Agency argues that awards of attorney fees must be based on a specific statutory authorization, such as the Back Pay Act, and not solely on a collective bargaining agreement. As no backpay was awarded in this case, and no other statutory authorization for the attorney fees was referenced by the Arbitrator, the Agency asserts that the award conflicts with the Back Pay Act. See Exception at 3.

B.     Union's Opposition

      The Union argues that the award is consistent with the Back Pay Act "because the Agency's actions were clearly without merit, which is one of the prerequisites" for awarding attorney fees under the Back Pay Act. Opposition at 2. The Union further notes that the Back Pay Act permits "[r]easonable attorney fees . . . relating to an [u]nfair [l]abor [p]ractice or a [g]rievance[.]" Id.

IV.     Analysis and Conclusion

      When an exception involves an award's consistency with law, the Authority reviews any question of law raised by the exception and the award de novo. See 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 the standard of de novo review, the Authority assesses whether an arbitrator's legal conclusions are consistent with the applicable standard of law. See United States DOD, Dep'ts of the Army and the Air Force, Ala. Nat'l Guard, Northport, Ala., 55 FLRA 37, 40 (1998). In making that assessment, the Authority defers to the arbitrator's underlying factual findings. See id.

      The Authority has long held that the expenditure of funds by a federal agency to pay attorney fees must be pursuant to specific statutory authorization. See Laborers' Int'l Union of N. America, Local 1376, 54 FLRA 700, 704 (1998). In this regard, longstanding Authority precedent provides that "a collective bargaining agreement cannot serve as a basis for an award of fees in the absence of statutory authority." See AFGE, Local 2419, 50 FLRA 128, 130 (1995) (citing NAGE, Local R7-23, 35 FLRA 638 (1990)). The Back Pay Act specifically authorizes awards of attorney fees in connection with the resolution of a grievance processed under a procedure negotiated in accordance with § 7121 of the Statute. See 5 U.S.C. § 5596(b)(1)(A)(ii). However, awards of attorney fees under the Back Pay Act must be in conjunction with an award of backpay, allowances, or differentials. See, e.g., Health Care Financing Admin., Dep't of Health and Human Serv., 35 FLRA 274, 290 (1990).

      There is no dispute that the Arbitrator here did not award backpay. Therefore, based on the foregoing precedent, the award of attorney fees is not authorized by the Back Pay Act. See id. Moreover, the Arbitrator did not specify any other statutory authorization for his award of attorney fees. Rather, the Arbitrator awarded attorney fees solely "under the provision of Article 40, Section 2(G)" of the parties' agreement. Award at 17. Because a collective bargaining agreement, standing alone, does not provide the necessary statutory authorization for an award of attorney fees, we conclude that the award of attorney fees is contrary to law.

V.     Decision

      The award of attorney fees is set aside.

Footnote # 1 for 60 FLRA No. 28 - Authority's Decision

   As relevant here, Article 15, Section 4 of the parties' Master Agreement provides, in pertinent part:

Each facility will establish awards panels consisting of management and bargaining unit employees. . . . Panel decisions will be made by consensus and will then be forwarded to the Director of the facility. . . . Panels will perform the following functions, maintaining the strictest confidentiality and avoiding even the appearance of conflicts of interest: Establish fair and equitable mission-related criteria for awards. Operate within parameters as negotiated locally.

Footnote # 2 for 60 FLRA No. 28 - Authority's Decision

   Article 40, § 2(G) of the parties' agreement provides, in relevant part, that "[t]he arbitrator has full authority to award appropriate remedies, including reasonable legal fees, pursuant to the provisions of Section 702 of the Civil Service Reform Act, in any case in which it is warranted."