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National Treasury Employees Union, Chapter 128 (Union) and United States Department of Homeland Security, United States Customs and Border Protection (Agency)

[ v62 p382 ]

62 FLRA No. 72







April 4, 2008


Before the Authority: Dale Cabaniss, Chairman, and
Carol Waller Pope, Member

I.     Statement of the Case

      This matter is before the Authority on an exception to an award of Arbitrator Margery Gootnick 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 exception.

      The Arbitrator determined that the Agency's decision to suspend the grievant, an auditor, for three days promoted the efficiency of the service because the grievant failed to honor just personal debts and having those debts was "incompatible with the fiduciary responsibilities of his position." Award at 9. For the reasons that follow, we deny the Union's exception.

II.      Background and Arbitrator's Award

      The grievant is an auditor in the Regulatory Audit Division of the Office of Strategic Trade. Award at 4. In this capacity, the grievant conducted unsupervised audits of airlines to determine "whether they have collected the proper use fees from passengers and whether they have remitted the user fees to the Government." Id.

      During a background investigation, the grievant was asked whether "he was over 180 days delinquent on any loan or financial obligation" to which he answered "no." Id. However after running a credit check, the Agency found a number of discrepancies that indicated the grievant's assertion was incorrect. Accordingly, upon further investigation, including a personal interview with the grievant in which the grievant disclosed that he had past debt problems, the Agency charged the grievant with "failure to pay just debts." Id.; Joint Exhibit (Ex) 3.

      After the parties were unable to agree upon a settlement to resolve this matter, the Agency imposed a three-day suspension but held it in abeyance pending the outcome of the grievance. The parties stipulated to the Arbitrator the following issue: "[d]oes the Agency's disciplinary action promote the efficiency of the service and if not, what is the appropriate remedy?" Award at 3.

      In resolving this issue, the Arbitrator determined that there was a "nexus" between the grievant's debts and his position and that those debts were inconsistent with the fiduciary responsibilities of his position. Id. at 9. Additionally, the Arbitrator made several findings that the grievant: (1) was "less than candid" in his response to his background investigation; (2) was required by regulation to "satisfy in good faith [his] obligation[] as [a] citizen[], including all just financial obligations," which he implicitly failed to do; (3) had the ability to pay his debts but implicitly chose not to; (4) failed to pay all of his debts; and, (5) based upon these issues, "potentially affected his supervisor's confidence in his judgment and in his ability to testify" along with his implicit ability to have contact with the public in executing his fiduciary duties as an auditor. Id. at 8, 9-10 (citing 5 C.F.R. § 2635.101(b)(12)). Accordingly, while the Arbitrator also noted mitigating evidence, she nonetheless found that the Agency was justified in suspending the grievant for three days because such suspension was appropriate and would promote the efficiency of the service. Id. at 11.

III.      Positions of the Parties

A.       Union's Exception

      The Union argues that the award is contrary to law. Specifically, the Union contends that in order for an agency to sustain an action based on misconduct, it must prove: (1)  "[t]hat the employee actually committed all the elements of the alleged misconduct; (2) [t]hat there is a sufficient nexus between the misconduct and the efficiency of the service to sustain the adverse action; and (3) [t]hat the particular penalty imposed had been appropriately chosen for the specific conduct involved and is based on a consideration of the factors relevant to promotion of service efficiency." Exception at 3 (citing Parsons v. United States Dep't of the Air Force, 707 F.2d 1406 (D.C. Cir. 1983); Douglas v. Veterans [ v62 p383 ] Administration, 5 MSPB 313 (1981)). The Union asserts that here the "element of [n]exus in the case of a charge of failure to pay just debts must be proven by a preponderance of evidence" because there is no legal presumption of nexus under these facts and that the Arbitrator's award fails to rely upon a preponderance of evidence in finding a nexus. Exception at 4, 5

      Specifically, the Union asserts that the Merit Systems Protection Board (MSPB) held that an agency could not presume nexus but must prove that an employee's failure to pay his debts will have a detrimental effect on his ability to perform his duties or on the agency's ability to perform its mission. The Union also notes that the MSPB rejected an argument in favor of presuming nexus in cases of failure to pay debts, holding that nexus could only be presumed where the conduct is shown to be egregious. Id. at 4 (citing Vilt v. United States Marshalls Service, Dep't of Justice, 16 MSPR 192 (1983). Additionally, the Union states that to the extent the Arbitrator relied upon evidence to establish a nexus, "the Agency failed to offer any evidence to support the nexus between debts owed and the efficiency of the service." Exception at 5. Accordingly, the Union argues that in the absence of a legal presumption of nexus or evidence to establish that an actual nexus exists, the award is contrary to law.

B.      Agency's Opposition

      The Agency notes that before misconduct can be proved for off-duty service, it must establish a nexus between the off-duty misconduct and the "efficiency of the service." Opposition at 3 (citing Merritt v. Dep't of Justice, 6 MSPR 585 (1981)). It argues that an agency can show such a nexus in a number of circumstances, including where it can show "preponderant evidence that the misconduct affects the employee's or his co-workers' job performance or management's trust and confidence in the employee's job performance[.]" Opposition at 3 (citing Kruger v. Dep't of Justice, et. al., 32 M.S.P.R. 71 (1987) (Kruger)).

      Here, the Agency states that the Arbitrator found that a nexus existed between the charge and the grievant's job duties. Specifically, the Agency argues that the Arbitrator determined "there is a nexus between [the grievant's] debts and his job because [the grievant's] debts were incompatible with the fiduciary responsibilities of his position." Opposition at 3 (citing Award at 9). In this respect, the Agency argues that the Arbitrator made several factual findings to support this conclusion including a determination that the grievant is responsible for conducting unsupervised audits that require integrity in the audit process. Opposition at 4. Moreover, the Agency asserts the award is sufficient to uphold the decision, and because the parties agreed to have an expedited arbitration process, the Union should not be surprised that the award is brief in its description of factual findings. Id. at 5.

IV.      Analysis and Conclusions

      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).

      The issue presented before the Authority is whether the Arbitrator's conclusion that there is a nexus between the efficiency of the service and the employee's misconduct is contrary to law. The Union argues that the award is contrary to law because either the Arbitrator relied upon a presumption of a nexus, which in the absence of egregious misconduct is contrary to law, or because the Arbitrator found an actual nexus without any factual support.

      In NAGE, Local R1-109, 58 FLRA 501, 504 (2003), the Authority determined that "generally, a nexus must be shown between an employee's off-duty misconduct and the efficiency of the service to support disciplinary action against that employee based on that misconduct." Id. (citing Immigration and Naturalization Serv., 8 FLRA 248, 249 (1982)). [n*]  In this case, the Arbitrator did not, contrary to the Union's claim, rely upon a legal presumption that there was a nexus between the grievant's debts and his ability to perform as an auditor. Rather, the Arbitrator specifically found "[t]here is a nexus between [the grievant's] debts and [ v62 p384 ] his job because [the grievant's] debts were incompatible with the fiduciary responsibilities of his position." Award at 9 (emphasis added).

      Having made a factual determination that the nexus existed, the Arbitrator determined that the grievant did commit the alleged misconduct and found a nexus between the grievant's debts and his job, and in so doing established that the misconduct affects management's trust and confidence in the employee's job performance. See Award at 9. In this respect, the Arbitrator factually determined that the grievant's off-duty misconduct of failing to honor just personal debts was "incompatible in the fiduciary responsibility of his position." Id. at 9. Accordingly, as the Arbitrator's award finds an actual nexus between the grievant's debts and his position as an auditor, a finding based upon facts to which we defer, the Union has failed to show that the award is contrary to law. Cf. Kruger, 32 M.S.P.R. at 75-76 (under § 7513 nexus can be established by such findings of fact).

V.       Decision

      The exception is denied.

Footnote # * for 62 FLRA No. 72 - Authority's Decision

   The "efficiency of the service standard" is set forth statutorily in 5 U.S.C. § 7503 and similarly, in 5 U.S.C. § 7513. Additionally, we note that, as relevant in this case, which involves a suspension of 14 days or less, the "efficiency of the service" standard set forth in 5 U.S.C. § 7503 is applicable. The same standard applies to more serious disciplinary actions which are within the jurisdiction of the MSPB. We also note that the Authority has long held that in cases involving a 14-day suspension or less, an arbitrator is "not bound to follow the same substantive standards as the MSPB." United States Dep't of Justice, INS, Jacksonville, Fl., 36 FLRA 928, 932 (1990); see also, United States Dep't of Homeland Security, United States Customs and Border Protection, Unites States Border Patrol, El Paso, Tex., 60 FLRA 883, 885 (2005).