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61 FLRA No. 126
OF GOVERNMENT EMPLOYEES
DEPARTMENT OF THE ARMY
CORPS OF ENGINEERS
HUNTINGTON, WEST VIRGINIA
August 3, 2006
Before the Authority: Dale Cabaniss, Chairman and Carol Waller Pope, Member
I. Statement of the Case
This matter is before the Authority on exceptions to an award of Arbitrator Stanley H. Sergent filed by the Union 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.
The matter concerns the Arbitrator's decision to reduce requested attorney fees awarded to the Union under the Back Pay Act. For the reasons that follow, we grant the Union's exception and modify the award consistent with our determinations below.
II. Background and Arbitrator's Award
In the underlying dispute, the Arbitrator determined that "the Agency committed an unjustified personnel action when it denied the grievant's request for travel time because such a denial was contrary to . . . past practice and violated Article VI of the [parties'] Agreement." Award at 3. In so finding, the Arbitrator also determined that Union counsel (counsel), who had represented the grievant, was entitled to attorney fees under the Back Pay Act.
In explaining why attorney fees were appropriate in this matter, the Arbitrator noted that such fees are appropriate under the Back Pay Act where an agency has engaged in an unjustified and unwarranted personnel action that has resulted in a loss of pay, allowances or differentials. Moreover, in finding fees justified here, the Arbitrator found that the fees were incurred for the services of an attorney, a fee request was submitted by the prevailing party, and fees were warranted in the interest of justice. Id. at 7 (citing Naval Air Development Ctr., Dep't of the Navy, 21 FLRA 131 (1986)).
However, the Arbitrator also determined that while fees were warranted, the total amount sought by counsel could not be awarded because not every claim was reasonable. In this regard, the Arbitrator reduced the rate of hourly attorney pay from $225 to $120 by noting that $120 was comparable with the "prevailing market rates" in the area of Huntington/Charleston West Virginia (the location of the hearing) and the Union did not show "that a local attorney could not be retained to handle th[is] case." Id. at 13 (citing Blum v. Stenson, 465 U.S. 886 (1984)). Moreover, the Arbitrator reduced the claimed billable hours by 25%, reduced travel expenses sought by counsel, and reduced compensable travel time. Id. at 14 (citing Silva v. Nat'l Telewire Corp., 2001 D.N.H. 218 (U.S.U.S. Dist. N.H.)); 2001 U.S. Dist. Lexis 20717. Ultimately, the Arbitrator awarded counsel $4,794.45 of the $13,803.90 request. Id. at 16; Verified Statement of Attorney's Fees and Costs at 3.
III. Positions of the Parties
A. Union's Exception
The Union argues only that the Arbitrator erred in determining that the "prevailing market rates" should be based on the rates for Huntington/Charleston West Virginia and not Washington D.C. where counsel practices. Exceptions at 2, 7 (citing United States Dep't of the Army, Corpus Christi Army Depot, Corpus Christi, Tex., 58 FLRA 87, 91 (2002) (Corpus Christi)). It contends that it does not need to show that no local attorney was available in order to receive a D.C. prevailing rate. Moreover, it argues that under the Laffey matrix, counsel is entitled to a per hour payment of $225 for all work completed prior to June of 2005 and for $290 for work completed thereafter. Exceptions at 5 (citing Laffey v. Northwest Airlines, 572 F. Supp. 354 (D.D.C. 1983)); see also, Exceptions, attachment 2, Counsel's Affidavit at 2.
B. Agency's Opposition
The Agency argues that the Authority should "sustain the Arbitrator's award of attorney fees and costs in this case, and affirm that the maximum reasonable amount of attorney fees . . . is $4,794.45." Opposition at 5. In this respect, it contends that the Union is only entitled to receive, as found by the Arbitrator, the prevailing hourly rate of attorneys practicing in the Charleston/Huntington area of West Virginia, especially where the Union has also failed to show it could not have hired local counsel. Id. at 2 (citing Blum; [ v61 p646 ] United States Dep't of Defense, Defense Distribution Region East, New Cumberland, Pa., 51 FLRA 155 (1995) (DOD)). Additionally, the Agency argues that while the Arbitrator was correct in determining that the prevailing market rate is Huntington/Charleston, the Arbitrator's determination of a $120 per hour fee is too high for that market. [n1]
IV. Analysis and Conclusions
A. Standard of Review
When a party's exception challenges an arbitration award's consistency with law, rule, or regulation, the Authority reviews the questions of law raised in the exception and the arbitrator's award de novo. See NFFE, Local 1437, 53 FLRA 1703, 1709 (1998). When applying a de novo standard of review, the Authority assesses whether an arbitrator's legal conclusions are consistent with the applicable standard of law, based on the underlying factual findings. Id. at 1710. In making that assessment, the Authority defers to the arbitrator's factual findings. See NTEU, Chapter 50, 54 FLRA 250, 253 (1998).
B. The Statutory Requirement for Attorney Fees
The threshold requirement for entitlement to attorney fees under the Back Pay Act, 5 U.S.C. § 5596, is a finding that the grievant was affected by an unjustified or unwarranted personnel action that resulted in the withdrawal or reduction of the grievant's pay, allowances, or differentials. See DOD, 51 FLRA at 158. Once such a finding is made, the Act requires that an award of fees must be: (1) in conjunction with an award of back pay 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 (MSPB). See id.
The prerequisites for an award of attorney fees under § 7701(g)(1) are: (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. As neither party disputes that the fees were warranted in the interest of justice, that the grievant was the prevailing party, or that the fees were incurred by the grievant, we will not address them further. See, e.g., United States Dep't of Defense, Def. Mapping Agency, Hydrographic/Topographic Ctr., Wash., D.C., 47 FLRA 1187, 1191-92 (1993). Accordingly, we will review the remaining issue as to whether the fees were reasonable.
C. Reasonableness of the Fees - The Prevailing Market Rate
The Union argues that the Arbitrator erred in determining the appropriate hourly wage counsel should receive. In this respect, the Union argues the Arbitrator applied a per hour rate of $120 based on the faulty premise that counsel was only entitled to the prevailing market rates for attorneys in the Huntington/Charleston area, rather than the reasonable rates for attorneys who practice in Washington, D.C..
In Corpus Christi, the Authority noted that it would follow the practice of the MSPB in determining the relevant community for calculating the prevailing market rate. Corpus Christi, 58 FLRA at 90. Based upon the MSPB's revised regulations in April of 2000, the Authority found that the relevant community is the community in which the attorney ordinarily practices. 5 C.F.R. § 1201.203(a)(3). [n2] Accordingly, as there is sufficient evidence to establish that the community in which counsel ordinarily practices is Washington, D.C., we find that the appropriate community for calculating fees is Washington, D.C., not Huntington/Charleston, West Virginia. See Counsel's Affidavit at 1; see also United States Dep't of Defense Education Activity, Arlington, Va., 57 FLRA 23, 26 (2001) (applying the Laffey matrix in determining market rates for attorneys in Washington, D.C.). Additionally, we note that there is no requirement that a client show it to be reasonably necessary before hiring non-local counsel. See Corpus Christi, 58 FLRA at 90. As such, we grant the Union's exception and modify the Arbitrator's award to reflect the applicable market rate.
The Union's exceptions are granted and the award modified to reflect the total amount due counsel, including costs, is $9,369.45. [n3]
Footnote # 1 for 61 FLRA No. 126 - Authority's Decision
We note, however, that to the extent this assertion constitutes a cross-exception, as the cross-exception was not filed within 30 days of the award, it is untimely and will not be reviewed. See, e.g., United States Dep't of Transportation, Federal Aviation Admin., 55 FLRA 797, 797 n.1 (1999) ("Exceptions within an opposition are considered only if filed within the time limit . . . for exceptions.")
Footnote # 2 for 61 FLRA No. 126 - Authority's Decision
5 C.F.R. § 1201.203(a)(3) states in pertinent part, "A statement of the attorney's customary billing rate for similar work, with evidence that that rate is consistent with the prevailing community rate for similar services in the community in which the attorney ordinarily practices[.]"
Pertinent portions of this regulation are set forth in the appendix and the end of this memorandum.
Footnote # 3 for 61 FLRA No. 126 - Authority's Decision
The Authority arrives at this amount by agreeing with the Union that under the revised Laffey matrix it is entitled to a fee of $225.00 per hour for 29 hours of work performed prior to June 1, 2005 and for $290.00 per hour for 9 hours of work performed after this date plus expenses of $234.45.