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U.S. Federal Labor Relations Authority

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United States, Department of the Treasury, Internal Revenue Service, Kansas City, Field Compliance Service (Agency) and National Treasury Employees Union, Chapter 66 (Union)

[ v60 p401 ]

60 FLRA No. 80







November 16, 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 John B. Barnard 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 exceptions.

      The Arbitrator found that the Agency violated the parties' agreement when it refused to process a grievance over an evaluative recordation. To remedy the violation, the Arbitrator ordered the Agency to comply with the parties' agreement and process grievances over evaluative recordations. For the reasons that follow, we deny the Agency's exceptions.

II.      Background and Arbitrator's Award

      The grievant filed a grievance contesting an evaluative recordation. [n1]  The Agency refused to process the grievance, asserting that the grievance was not grievable under the parties' agreement. When the grievance was not resolved, the matter was submitted to arbitration. The Arbitrator considered the following issues: "Did the Agency violate Article 41, Sections 2, 7, and 8 when it refused to hear and process the grievance . . . ? If so, what is the appropriate remedy?" [n2]  Award at 19.

      Initially, the Arbitrator explained that Article 41, § 2 of the parties' agreement defines a grievance as "a matter relating to [the grievant's] employment." Id. at 20. The Arbitrator found that the matter at issue here -- the grievant's evaluative recordation -- concerns a matter relating to the grievant's employment, within the meaning of Article 41, § 2.

      In assessing whether evaluative recordations are excluded from the parties' grievance procedure, the Arbitrator found that initially, the parties' agreement prohibited grievances over "the recordation except in relation to a grievance related to the completed evaluation . . . ." [n3]  Id. at 23. However, the Arbitrator found that this language subsequently was "taken out of" the parties' agreement, so that "evaluative recordations [could] be grieved[.]" [n4]  Id. at 24. As to the parties' current agreement, the Arbitrator rejected an Agency witness' testimony that the Union gave up the right to grieve evaluative recordations during bargaining, finding that "no supportive documentation was presented to substantiate his testimony." Id. at 24-25.

      The Arbitrator also found that Article 12, § 4(S) of the parties' current agreement "outlines a specific process to be utilized in grieving any disputes regarding performance appraisals." Id. at 25. Moreover, the Arbitrator found that Article 12, § 4(B)(7) sets forth a specific circumstance in which a grievance is not proper. The Arbitrator further found that Article 40, § 2(B) specifically "references a prohibition against the filing of a grievance over a notice of propos[ed] action based on unacceptable performance . . . ." [n5]  Id. at 26. In comparison, the Arbitrator found that Article 12, § 9, which addresses evaluative recordations, "is silent as to any prohibition of a grievance over an evaluative recordation" [ v60 p402 ] and does not "outline a different grievance procedure" for evaluative recordations. Id. at 26. Consequently, noting again the definition of a grievance under Article 41, the Arbitrator determined that evaluative recordations are grievable under the parties' agreement.

      Based on the foregoing, the Arbitrator found that, by refusing to process the grievance, the Agency violated Article 41 of the parties' agreement. To remedy the violation, the Arbitrator directed the Agency to "comply with the terms of the grievance procedure and to process grievances filed in respect to evaluative recordations." Id. at 28.

III.     Positions of the Parties

A.     Agency's Exceptions

      The Agency argues that the award is based on nonfacts. Specifically, the Agency claims that the Arbitrator "referenced the wrong collective bargaining agreement when he concluded that the Agency must process grievances over evaluative recordations." Exceptions at 4. In this connection, the Agency asserts that the Arbitrator referenced the parties' current agreement, which took effect on July 1, 2002 when he should have referenced the "agreement [that] was in effect when the grievant received his mid-year progress review on June 28, 2002." Id. The Agency also claims the "award is also based upon a `non-fact' because [the Arbitrator] gave no weight to the unrebutted testimony of an Agency witness concerning bargaining history." Id.

      The Agency also argues that the award fails to draw its essence from the parties' agreement because the Arbitrator "did not reconcile the fact that Agency employees cannot grieve every performance appraisal upon receipt under the Agreement with his conclusion that every evaluative recordation can now be grieved." Id. at 4. According to the Agency, that the Arbitrator "literally interpreted the words" of Article 41 "without due regard to the overall structure of the collective bargaining agreement as a whole." Id. at 9. The Agency also claims that the award prevents it from complying with Article 12's requirement to give employees annual performance appraisals.

      Finally, the Agency argues that the award is contrary to law because it excessively interferes with management's rights to direct employees and assign work. In this regard, the Agency claims it "will virtually be paralyzed in its ability to effectively evaluate the performance of its employees in a prompt manner" because an employee can now grieve "every piece of evaluative documentation ever given to an employee . . . ." Id. at 12. As the result, the Agency claims that "employees' ratings will always be in a state of flux . . . ." Id.

B.     Union's Opposition

      According to the Union, "[t]he Agency's claim that the Arbitrator applied the wrong agreement provides no basis for overturning his award because a determination of the applicable agreement, itself, is a matter of contract interpretation that the Authority will not disturb." Opposition at 2. Also, according to the Union, the award is not deficient based on the Arbitrator's credibility determination because that determination resolved a specific dispute between the parties.

      The Union opposes the Agency's essence exception, arguing that "[t]he Agency concedes that the Arbitrator's award incorporates a literal interpretation of the matters that are covered by the grievance procedure." Id. at 5 (citing Exceptions at 9). Finally, the Union asserts that the award does not affect management's rights to direct employees and assign work because the award "does not direct the Agency to take any particular action when appraising employees." Id. at 6.

IV.     Analysis and Conclusions

A.     The Award Is Not Based on Nonfacts

      To establish that an award is based on a nonfact, the appealing party must show that a central fact underlying the award is clearly erroneous, but for which the arbitrator would have reached a different result. See NFFE, Local 1984, 56 FLRA 38, 41 (2000). However, the Authority will not find an award deficient on the basis of an arbitrator's determination of any factual matter that the parties disputed at arbitration. See id. 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 NLRB, 50 FLRA 88, 92 (1995).

      The Arbitrator's determination that the parties' current agreement was controlling in this case is based on his interpretation of the parties' current agreement, as well as prior agreements. See Award at 2-5, 21-22, 25. Consequently, this arbitral finding cannot be challenged as a nonfact. [n6]  Likewise, the Agency's claim that the Arbitrator failed to credit its witness' testimony does not provide a basis for finding the award deficient. In this [ v60 p403 ] regard, the Authority has held that exceptions disputing an arbitrator's evaluation of the credibility of witnesses and the weight to be given their testimony provide no basis for finding an award deficient. See United States DOL, Wash., D.C., 55 FLRA 1019, 1023 (1999) (then-Member Cabaniss dissenting on other grounds). Therefore, we deny the Agency's exception.

B.     The Award Draws Its Essence from the Parties' Agreement

      In reviewing an arbitrator's interpretation of a collective bargaining agreement, the Authority applies the deferential standard of review that federal courts use in reviewing arbitration awards in the private sector. See 5 U.S.C. § 7122(a)(2); AFGE, Council 220, 54 FLRA 156, 159 (1998). Under this standard, the Authority will find that an arbitration award is deficient as failing to draw its essence from the collective bargaining agreement when the appealing party establishes that the award: (1) cannot in any rational way be derived from the agreement; (2) is so unfounded in reason and fact and so unconnected with the wording and purposes of the collective bargaining agreement as to manifest an infidelity to the obligation of the arbitrator; (3) does not represent a plausible interpretation of the agreement; or (4) evidences a manifest disregard of the agreement. See United States Dep't of Labor (OSHA), 34 FLRA 573, 575 (1990). The Authority and the courts defer to arbitrators in this context "because it is the arbitrator's construction of the agreement for which the parties have bargained." Id. at 576.

      The Agency claims the Arbitrator should not have applied the parties' current agreement because that agreement did not take effect until July 1, 2002, after the disputed progress review, which took place on June 28, 2002. However, record evidence shows that the grievance was filed on July 11, 2002, after the current agreement was already in effect. See Exceptions, Attachment 3 at 7. The Agency does not point to any provision of either of the agreements at issue that necessarily required the Arbitrator to apply the former, rather than the current, agreement. Consequently, the Arbitrator's determination to apply the parties' current agreement is not irrational, unfounded, or implausible, and it does not demonstrate a manifest disregard of the parties' agreement.

      The Arbitrator's determination that Article 41 of the parties' agreement permits grievances over evaluative recordations also is not deficient. In reaching this conclusion, the Arbitrator specifically noted the definition of "grievance" as provided in Article 41, § 2 of the parties' agreement. Further, the Arbitrator considered the fact that Article 12, § 4 expressly sets forth circumstances in which "grievances" over performance appraisals are either permitted or prohibited, while Article 12, § 9 does not mention "grievances" over evaluative recordations. In disputing the Arbitrator's interpretation of Article 41, the Agency concedes that the Arbitrator "literally interpreted the words" of Article 41 and that the Arbitrator's interpretation of Article 41, based on his review of Article 12, is "plausible[.]" Exceptions at 6, 9. Consequently, the Agency has not demonstrated that the award fails to draw its essence from the parties' agreement, and we deny the Agency's exception.

C.     The Agency's Contrary to Law Exception Is Not Properly Before the Authority

      Under 5 C.F.R. § 2429.5, an issue that could have been but was not presented before an arbitrator will not be considered by the Authority. See United States Dep't of the Air Force, Air Force Materiel Command, Robins Air Force Base, Ga., 59 FLRA 542, 544 (2003). There is no evidence in the award or the record that the Agency ever argued to the Arbitrator that interpreting the parties' agreement to permit grievances over evaluative recordations would violate its rights under § 7106(a) of the Statute. Moreover, such an argument could have been made to the Arbitrator. In this connection, the Agency argued to the Arbitrator that other adverse affects would result from a determination that the parties' agreement permits grievances over evaluative recordations. Specifically, the Agency claimed that such a determination would "render[] certain provisions [of the parties' agreement] meaningless[,]" prevent the Agency from providing employees with "firm annual appraisals[,]" and result in an "inefficient and . . . nonsensical" grievance process. Award at 16, 18. However, the Agency did not claim, as it does here, that permitting such grievances would also violate its rights to direct employees and assign work. As this argument could have been, but was not, raised below, it is not properly before the Authority. Therefore, we will not consider the Agency's contrary to law exception.

V.      Decision

      The Agency's nonfact and essence exceptions are denied and its contrary to law exception is dismissed. [ v60 p404 ]


Article 12       Performance Appraisal System

Section 4       Performance Appraisals


. . . .

7. [T]he supervisor's determination not to prepare a new appraisal is not grievable.

. . . .

S.     Therefore, as an exception to the negotiated grievance procedure set forth in Article 41, the following process will be used exclusively to grieve disputes regarding performance appraisals.

Section 9 Evaluative Recordation

A.       The Employer has determined that an evaluative recordation will be furnished to an employee within fifteen (15) workdays of the time the supervisor becomes aware, or should have been aware, of the event which it addresses. If furnished after that time, it may not be used by the supervisor, a ranking panel, or ranking official. Any material which may have an adverse effect on an employee's appraisal or rating by a ranking panel or ranking official, the maintenance of which is not required by the IRM system and which is not shared with the employee, shall be removed and destroyed. Telephone monitoring evaluative recordation will be conducted in accordance with subsection 4Q.

B.       The Employer will grant the employee a reasonable amount of official time to make written comments concerning any disagreement with an evaluative recordation or other review document at any time prior to its use in a performance appraisal or personnel action. Such comments will be attached to and become a part of the appraisal. The supervisor will determine the appropriate time for the employee to prepare the written response based on workload demands. This time will be scheduled no later than three (3) workdays after the receipt of the request for official time.

Article 41 Employee Grievance Procedure

Section 2

A.      The term "grievance" means any complaint:

1.      by an employee concerning any matter relating to the employment of the employee;
2.      by the Union concerning any matter relating to the employment of any employee; or
3.      by an employee or the Union concerning:
(a)     The effect or interpretation, or a claim of a breach, of a collective bargaining agreement; or
(b)     any claimed violation, misinterpretation, or misapplication of any law, rule or regulation affecting conditions of employment.

Section 7 Uniform Employee Grievance Procedure

The parties are encouraged to seek informal resolution of grievances . . . .

Section 8

C.       If the Employer raises questions of grievability or arbitrability, the grievance will be amended to include a resolution of this question in the processing of the grievance.

Footnote # 1 for 60 FLRA No. 80 - Authority's Decision

   An evaluative recordation includes a progress review or any other evaluative documentation that is issued to an employee prior to a formal appraisal. See Award at 6-7.

Footnote # 2 for 60 FLRA No. 80 - Authority's Decision

   Relevant provisions of the parties' current agreement, including Article 12, §§ 2, 4, and 9 and Article 41, §§ 2, 7 and 8 are set forth, in relevant part, in the appendix.

Footnote # 3 for 60 FLRA No. 80 - Authority's Decision

   The parties' agreement previously provided, in Article 9, Section 1.E, that "the content [of evaluative recordations] may not be grieved except in relation to a grievance related to the completed evaluations . . . ." Award at 22.

Footnote # 4 for 60 FLRA No. 80 - Authority's Decision

   As relevant here, the parties' agreement later provided, in Article 12, Section B, that "[e]mployees may make written comments concerning any disagreements with an evaluative recordation any time prior to its use in an annual appraisal." Award at 22.

Footnote # 5 for 60 FLRA No. 80 - Authority's Decision

   The record does not contain the specific language of Article 40, § 2(B) of the parties' current agreement.

Footnote # 6 for 60 FLRA No. 80 - Authority's Decision

   We construe the Agency's exception in this regard as a claim that the award fails to draw its essence from the parties' agreement, and we resolve the exception supra in section IV(B) of this decision.