National Treasury Employees Union (Union) and United States, Department of the Treasury, Internal Revenue Service, Washington, D.C. (Agency)

[ v60 p782 ]

60 FLRA No. 148







March 29, 2005


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 Carlton J. Snow 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. [n1] 

      For the following reasons, we grant interlocutory review of the Agency's exceptions and set aside the portion of the award that assesses the validity of a qualification standard established by the Office of Personnel Management (OPM). [n2] 

II.     Background and Arbitrator's Award

      As relevant here, OPM approved, and set forth in the OPM Qualifications Handbook, an Agency-proposed qualification standard for the Revenue Agent position. That standard includes a requirement of completion of "30 semester hours in accounting" (the thirty-hour requirement). United States OPM Operating Manual for Qualification Standards for General Schedule Positions at IV-B-83.

      When the Agency denied an employee's application for a Revenue Agent position because she did not meet the thirty-hour requirement, she filed a grievance. In a separate grievance, the Union challenged a vacancy announcement that required candidates for a Revenue Agent position to demonstrate knowledge in five specific areas of accounting (the five-knowledges requirement). The Agency denied both grievances, and the grievances were consolidated and submitted to arbitration.

The Arbitrator framed the issues as follows:
(1)     Is the grievance arbitrable?
(2)     If so, is the [thirty-hour] requirement . . . in accordance with applicable law, rule, regulation, and the parties' labor contract?
(3)     Is the [five-knowledges] requirement . . . in accordance with applicable law, rule, and regulation as well as the parties' collective bargaining agreement? If there has been a contractual violation, what is an appropriate remedy?

Award at 3.

      As an initial matter, the Arbitrator rejected the Agency's contention that he lacked jurisdiction. In this regard, the Arbitrator found that the Agency had cited "no express exclusion in contract or law that removes the dispute from the [A]rbitrator's jurisdiction." Id. at 22.

      Addressing the merits, the Arbitrator found that the thirty-hour requirement and the five-knowledges requirement violate 5 U.S.C. § 3308 and the parties' agreement. [n3]  The Arbitrator stated that the parties had [ v60 p783 ] ninety days "to negotiate an acceptable remedy, during which time either party may activate the [A]rbitrator's jurisdiction to fashion an appropriate remedy." Id. at 44.

III.      Positions of the Parties

A.     Agency Exceptions

      The Agency asserts that its exceptions are interlocutory but that the Authority should review them because they present a plausible jurisdictional defect, the resolution of which will advance the ultimate disposition of this case. Specifically, the Agency contends that the Arbitrator lacks jurisdiction to determine the legality of the thirty-hour requirement because OPM has the authority to establish qualification standards. [n4]  In this regard, the Agency states that the Authority lacks jurisdiction to assess the validity of an OPM regulation and, consequently, the Arbitrator also lacks such jurisdiction. Further, the Agency claims that, under 5 C.F.R. § 300.104(a), the Merit Systems Protection Board (MSPB) has jurisdiction over challenges to employment practices that are applied by OPM. [n5]  Finally, the Agency argues that, because the "vast majority" of unsuccessful applicants were rejected based on the thirty-hour requirement, resolving its exception would "advance resolution of the entire matter" and "greatly simplify the parties' efforts to resolve their remaining disputes." Exceptions at 15.

B.     Union Opposition

      The Union does not dispute that the Arbitrator is not permitted to invalidate OPM regulations. However, the Union contends that the Arbitrator did not invalidate an OPM regulation. According to the Union, the Arbitrator simply found that the Agency's use of the thirty-hour requirement violated 5 U.S.C. § 3308. The Union points out that, instead of invalidating the thirty-hour requirement, the Arbitrator permitted the parties to negotiate an appropriate remedy. The Union asserts that there are potential remedies that would not require invalidating the requirement, including ordering the Agency to cease hiring Revenue Agents under that requirement or to seek OPM approval to modify the requirement. Further, the Union claims that resolving the Agency's exceptions at this time would not advance the ultimate disposition of this case because whether or not the Arbitrator is permitted to invalidate the thirty-hour requirement: (1) the parties must determine an appropriate remedy in connection with the five-knowledges requirement; (2) the hearing in this case has already occurred; and (3) the Agency has stated its intent to file numerous additional exceptions in the event that the Arbitrator issues a remedy award.

IV.     Analysis and Conclusions