United States, Department of Transportation, Federal Aviation Administration, Atlanta, Georgia (Respondent) and National Air Traffic Controllers , Association (Charging Party)

[ v60 p985 ]

60 FLRA No. 177



(Charging Party)




May 31, 2005


Before the Authority: Dale Cabaniss, Chairman, and
Carol Waller Pope and Tony Armendariz, Members [n1] 

I.      Statement of the Case

      This unfair labor practice case is before the Authority on exceptions to the attached decision of the Administrative Law Judge filed by the Respondent. The General Counsel filed an opposition.

      The complaint alleges that the Respondent violated § 7116(a)(1) and (5) of the Federal Service Labor-Management Relations Statute (the Statute) when the Respondent repudiated a grievance settlement agreement.

      Upon consideration of the Judge's decision and the entire record, we conclude for the reasons discussed below that the Respondent did not commit the unfair labor practices alleged in the complaint. Accordingly, we will dismiss the complaint.

II.      Background and Judge's Decision

      The affected employee in this case sustained an on-the-job injury for which he filed a claim for workers' compensation. While the claim was pending, the employee used paid leave. The Union filed a grievance claiming that the Respondent failed to comply with federal regulations regarding the timely processing of the claim for compensation. When the employee's claim for benefits was approved and he was given the option to "buy back" the leave he had used, the employee declined to do so. See DOL Information Guide CA-11 When Injured at Work Information Guide for Federal Employees, April 25, 2005 (DOL Website).

      Subsequently, the Respondent, through an authorized representative, entered into a settlement agreement with the Charging Party to resolve the grievance. Specifically, the settlement agreement provided for the payment of $3,000 to the employee. However, the Respondent refused to pay the employee, resulting in an unfair labor practice (ULP) charge and complaint alleging that the Respondent repudiated the settlement agreement with the Charging Party.

      According to the Judge, the Respondent acknowledged failing to pay the employee under the terms of the settlement agreement. The Judge noted that the Respondent acknowledged that its settlement of the grievance was an implicit admission that an unjustified or unwarranted personnel action occurred. See Judge's Decision at 8. The Judge stated that the Respondent contended that it refused to pay the amount in the settlement agreement because such a payment would constitute a violation of the Back Pay Act, 5 U.S.C. § 5596. Additionally, the Respondent claimed that because the employee chose not to buy back his leave, he did not suffer a withdrawal or reduction of his pay, allowances or differentials.

      The Judge determined that the sole issue to be determined was the legality of the payment to the employee. The Judge stated that under the Back Pay Act, an employee who was affected by an unjustified or unwarranted personnel action which resulted in the withdrawal or reduction of pay, allowances or differentials is entitled to receive an amount equal to all or part of the pay, allowances or differentials the employee would have earned or received.

      The Judge rejected the Respondent's claim that the employee suffered no loss. The Judge found that, as alleged in the grievance, the Respondent's delay in processing the employee's claim caused him to "`lose'" accrued leave. Judge's Decision at 7. The Judge also determined that leave constitutes an allowance pursuant to 5 U.S.C. § 5596(1)(B)(i) and (ii). The Judge stated that the settlement agreement did not set forth the basis for the monetary payment. However, the Judge found that the purpose of the settlement agreement was to settle the grievance. Accordingly, the Judge found "that the intent of the parties to the settlement agreement was [ v60 p986 ] to partially compensate [the employee] for the use of his leave." Id.

      Based on the foregoing, the Judge concluded that the agreement did not violate the Back Pay Act. Accordingly, the Judge found that the Respondent violated § 7116(a)(1) and (5) of the Statute and recommended that the Authority order the Respondent to pay the employee the $3,000 as set forth in the settlement agreement plus interest and post a notice.

III.      Positions of the Parties

A.      Respondent's Exceptions

      The Respondent contends that it did not violate § 7116(a)(1) and (5) of the Statute because a refusal to honor an agreement that is contrary to law is not an unlawful repudiation of the agreement. The Respondent argues that the settlement agreement is contrary to the Back Pay Act and, therefore, its failure to comply with the agreement did not constitute an unlawful repudiation of the agreement.

B.      General Counsel's Opposition

      The General Counsel argues that the Respondent voluntarily entered into a settlement agreement to avoid the costs of arbitration. According to the General Counsel, if the Respondent is permitted to relitigate the merits of the grievance, then the Respondent has "successfully discovered through its repudiation a cost effective alternative to arbitration." Opposition at 5. The General Counsel contends that the Respondent should not be allowed to justify its repudiation by asserting that the agreement is illegal under the Back Pay Act. See Opposition at 5. The General Counsel asserts that to allow the Respondent to "renounce its own settlement agreement through such a manipulation would directly contradict public policy encouraging the amicable settlement of disputes prior to litigation." Id.

      Additionally, the General Counse