United States Department of the Air Force, Luke Air Force Base, Arizona (Agency) and American Federation of Government Employees, Local 1547 (Union)

65 FLRA No. 169                                             
LOCAL 1547
May 11, 2011
Before the Authority: Carol Waller Pope, Chairman, and Thomas M. Beck and Ernest DuBester, Members
I.        Statement of the Case
        This matter is before the Authority on exceptions to an award of Arbitrator Richard D. Sambuco 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. 
        As relevant here, the Arbitrator found that the Agency did not have just cause to remove one of two grievants from his position and ordered the Agency to return the grievant to his former position and to pay the grievant backpay. Award at 36. For the reasons set forth below, we grant the Agency’s contrary to law exception and set aside the award. 
II.      Background and Arbitrator’s Award
        The grievants were employed by the Agency as temporary security guards. Id. at 7, 8. As a condition of their employment, the Agency required the grievants to sign a Statement of Understanding (Statement). Id. at 9. The Statement indicated that, as temporary limited employees hired for a period of one year or less, they were “not covered by the adverse action procedures under” 5 U.S.C. § 4303 and 5 U.S.C. § 7511, and could be “terminated at any time upon notice from the [A]gency.” Id. at 11-12. After the grievants worked for the Agency for approximately two months, the Agency terminated their employment.[1] See id. at 9. 
        The Union filed a grievance on behalf of the grievants. Id. at 9-10. The matter was unresolved and was submitted to arbitration. Id. at 10. The Arbitrator framed the following issues: whether “the Agency violate[d] the language of the Labor Management Agreement [(parties’ agreement)] when it terminated [the grievants]? If [so], what is the remedy?” Id.
        The Arbitrator found that the Statement constituted an implied contract because it failed to contain an express disclaimer indicating that it was not “an express or implied contract of employment.” Id. at 15 (internal quotation marks omitted); see also id. at 14, 33. The Arbitrator determined that, because the grievants were employed under an implied contract, they were not “at will” employees, and the Agency could terminate their employment only for just cause. Id. at 15, 22. The Arbitrator found that, although the first grievant’s employment was terminated for just cause, the Agency did not have cause to remove the second grievant. Id. at 34-35, 36. The Arbitrator determined that the Agency did not have just cause to remove the second grievant because he did not have a prior disciplinary record, his absences were approved by his supervisor and “ostensibly granted due to [his] attempt to establish a work related injury[,]” and a bargaining unit employee rather than the direct supervisor signed his termination notice. Id. at 24; see also id. at 34, 36. Additionally, the Arbitrator found that the grievants were entitled to grieve their removals under the parties’ agreement because the Union timely notified the Agency of its intent to negotiate a new agreement, and the provision prohibiting temporary employees from grieving their terminations was a
permissive subject of bargaining that expired with the agreement.[2] Id. at 21-22, 34. 
III.   Positions of the Parties
A.      Agency’s Exceptions
        The Agency claims that the award is contrary to law because, as temporary employees, the grievants are prohibited from grieving their terminations. Exceptions at 4-5. Moreover, the Agency asserts that the award is contrary to law because temporary employees “may be terminated without cause at any time.” Id. at 5.
        Also, the Agency claims that the Arbitrator exceeded his authority and that the award interferes with management’s right to remove employees. Id. Specifically, the Agency asserts that the Arbitrator wrongfully concluded that the Statement was an implied contract and that the Agency could terminate the grievants’ employment only for just cause. Id. According to the Agency, the “award excessively interferes with management’s right . . . to terminate an employee not entitled to a hearing by law.” Id. Moreover, the Agency claims that the Arbitrator exceeded his authority by asserting “jurisdiction over an issue specifically excluded from the grievance procedure” and by administering a remedy that he had no authority to grant under the law. Id.; see also id. at 6.
B.      Union’s Opposition
        The Union argues that the grievance was properly before the Arbitrator and that the award does not fail to draw its essence from the parties’ agreement because temporary employees are not excluded from the bargaining unit and the just cause provisions of the agreement apply to temporary employees. Opp’n at 3, 4-5. Also, the Union contends that the Arbitrator did not exceed his authority because he resolved the issue that was before him, and the issue that he framed corresponded to the statement of the issue in the grievance. Id. at 5. According to the Union, the Arbitrator properly found that the Agency did not have just cause to suspend the second grievant. Id. at 4-5, 6. Finally, the Union argues that the Agency, in its exceptions, ignores the fact that the provision prohibiting temporary employees from grieving their terminations was a permissive subject of bargaining and expired with the agreement. Id. at 3, 6.
IV.    Analysis and Conclusion: The award is contrary to law.
        When an exception involves an award’s consistency with law, the Authority reviews any que