[ v30 p1156 ]
30:1156(127)AR
The decision of the Authority follows:
30 FLRA NO. 127
30 FLRA 1156 (1988)
28 JAN 1988
SOCIAL SECURITY ADMINISTRATION
Agency
and
AMERICAN FEDERATION OF GOVERNMENT
EMPLOYEES, AFL-CIO
Union
Case No. 0-AR-1395
DECISION
I. Statement of the Case
This matter is before the Authority on an exception to the
award of Arbitrator Robert H. Mount. The Arbitrator ordered the
grievant's performance appraisal rating for one of her job
elements changed to a higher rating and her overall rating
revised accordingly. The exceptions were filed by the Social
Security Administration under section 7122(a) of the Federal
Service Labor - Management Relations Statute (the Statute) and
part 2425 of the Authority's Rules and Regulations. The Union did
not file an opposition.
The question presented here is whether the award is contrary
to management's rights to direct employees and assign work under
section 7106(a)(2)(A) and (B) because the Arbitrator altered the
content of the established performance standards and substituted
his judgment for that of management as to what the grievant's
rating should be and what the content of the standard should be.
We conclude that the Arbitrator exceeded his authority and that
the award is contrary to section 7106(a)(2)(A) and (B) because
the Arbitrator improperly altered the content of the standard.
However, based on our view of the permissible scope of an
arbitrator's authority, we reject the contention that the award
is deficient because the rating change constituted an improper
substitution of judgment by the Arbitrator for that of
management.
This case presents an opportunity for us to reexamine the
Authority's approach to the authority of arbitrators in
performance appraisal cases. The approach we will follow in this
and future cases is discussed in Section IV.B. of this
decision.
II. Background and Arbitrator's Award
A grievance was filed and submitted to arbitration claiming
that the established performance standards had not been fairly
and equitably applied to the grievant. The grievant sought to
have her rating for GJT (Generic Job Task) #6 changed from level
2 to level 3 and her summary rating changed from wfully
satisfactory to excellent.
The Arbitrator first determined that the Activity had
violated the parties' memorandum of understanding by failing to
inform the grievant in writing of the method used to determine
performance. The Arbitrator also determined that the delay in
writing the grievant's progress reviews was arbitrary and
capricious.
The Arbitrator next addressed whether a proper appraisal
would show that the grievant had performed at level 3. The
Activity argued that the grievant was rated by management at
level 2 in both her progress reviews and her appraisal. The
Arbitrator, however, ruled that the narrative evaluation of the
employee must support the rating. He found that the narrative
supported a rating of level 3 except for the grievant's
performance with respect to the work control and access program
(WCAP) listings. Although the Arbitrator refused to rule that the
listings were not an appropriate measure of performance, he ruled
that they were not to be considered in this case because the
listings had been discarded by management. With that portion of
the narrative eliminated, the Arbitrator decided that the
grievant was entitled to a rating of level 3. Accordingly, the
Arbitrator ordered the grievant's rating for GJT #6 changed to
level 3 and her summary appraisal changed to excellent.
III. Exception
The Agency contends that the Arbitrator's award is contrary
to section 7106 (a)(2)(A) and (B) of the Statute. The Agency
argues that the award is deficient because the Arbitrator altered
the content of the established standards by eliminating
consideration of the WCAP listings. The Agency maintains that as
a consequence, the Arbitrator independently evaluated the
grievant's performance and substituted his judgment for that of
management as to what] the grievant's evaluation and
rating should be. The Agency maintains that the Arbitrator should
have ordered the grievant reevaluated in accordance with
reconstructed WCAP listings.
IV. Discussion
The exception in this case presents the issue of the role of
arbitrators in resolving grievances involving performance
appraisal matters.
A. Current Case Law
Management's rights to direct employees and assign work
under section 7106(a) (2)(A) and (B) include the rights to
identify critical job elements and establish performance
standards. For example, National Treasury Employees Union and
Department of the Treasury, Bureau of the Public Debt, 3 FLRA
768 (1980), aff'd sub nom. NTEU v. FLRA, 691 F.2d 553 (D.C. Cir.
1983). Proposals which improperly interfere with management's
rights to identify elements and establish standards are
nonnegotiable. Likewise, arbitration awards which improperly
interfere with management's exercise of these rights are contrary
to section 7106(a)(2)(A) and (B). In particular, arbitration
awards which alter or determine the content of established
performance standards are deficient. See Social Security
Administration, Office of Hearings and Appeals, Region II and
American Federation of Government Employees, Local 1760, 21 FLRA
672 (1986).
In Newark Air Force Station and American Federation of
Government Employees, Local 2221, 30 FLRA No. 76 (1987), we
reexamined the arbitrability of grievances alleging that
management violated law and regulation in establishing elements
and standards of employees. We found that a grievance alleging
that management violated applicable law or regulation when it
established a grievant's performance standards and
elements--whether or not the grievant has been evaluated under
the standards and elements--is grievable and arbitrable under the
Statute. We emphasized that the "question of any impermissible
arbitral interference with management's rights must be directed
to the merits, including remedy, of an arbitration decision"
relating to the consistency of performance standards with law.
Id., slip op. at 21. We noted that an arbitrator may not
determine the content of established standards and may not
establish new standards. Id., slip op. at 22.
Unlike previous case law concerning the establishment of
performance standards and elements, the Authority has
consistently found that grievances challenging the application of
established elements and standards to an individual employee
through the appraisal process are grievable and arbitrable. The
Authority emphasized that in these grievances, review by the
arbitrator would not affect management's determinations as to the
content of the elements and standards. Instead, an arbitrator
would determine only whether the application of the elements and
standards to the employees complied with applicable law,
regulation, and the parties' collective bargaining agreement. For
example, Bureau of Engraving and Printing, U.S. Department of the
Treasury and Washington Plate Printers Union, Local No. 2, IPDEU,
AFL - CIO, 20 FLRA 380 (1985).
Accordingly, arbitrators may resolve a grievance by an
employee claiming to have been adversely affected by management's
application of the established elements and standards.
Arbitrators may sustain the grievances if they determine that
management had not applied the established elements and standards
or that management had applied the established elements and
standards in violation of law, regulation, or a properly
negotiated provision of the parties' collective bargaining
agreement. As a remedy, the arbitrator may direct that the
grievant's work product or performance be reevaluated under the
established elements and standards if not applied, or in
accordance with the law, regulation or agreement provision with
which management failed to comply.
The Authority has held that in limited circumstances, an
arbitrator may order management to change the grievant's
performance rating. Under existing case law, such an order is
appropriate only when the applicable elements and standards
permit the arbitrator "in an objective, nondiscretionary, and
essentially mechanistic manner to determine without an
independent evaluation that the aggrieved employee was entitled
to a different rating under the established standards." For
example, Warner Robins Air Logistics Center, Robins Air Force
Base, Georgia and American Federation of Government Employees,
AFL - CIO, Local 987, 28 FLRA 652, 654 (1987) (Member McKee
concurring in the result). However, arbitrators may not conduct
an independent evaluation of the employee's performance under the
performance standards established by management. Further,
arbitrators may not substitute their own judgment for that of
management as to what the grievant's evaluation and
rating should be. For example, Department of Health and Human
Services, Social Security Administration and American Federation
of Government Employees, AFL - CIO, Local 3231, 28 FLRA 961
(1987) (Member McKee dissenting).
On reexamination, we reaffirm that disputes relating to the
application of the established elements and standards to an
individual employee are grievable and arbitrable. We also
reaffirm that arbitrators may sustain grievances if they
determine that management had not applied the established
elements and standards or that management had applied the
established elements and standards in violation of law,
regulation, or a properly negotiated provision of the parties'
collective bargaining agreement. Consistent with our decision in
Newark Air Force Station, awards may not interfere with
management's rights to establish standards and elements unless
the arbitrator determines that management violated applicable law
or regulation in exercising those rights.
B. Approach To Be Followed With Respect to the Remedial
Authority of Arbitrators
On reexamination, we conclude that the restrictions on the
remedial authority of arbitrators noted above are not warranted.
We have formulated an approach which in our view is more
consistent with the Statute and better serves the purpose of the
Statute to facilitate and encourage the settlement of disputes.
We now hold that when an arbitrator finds that management
has not applied the established elements and standards or that
management has applied the established elements and standards in
violation of law, regulation, or a properly negotiated provision
of the parties' collective bargaining agreement, the arbitrator
may cancel the performance appraisal or rating. When the
arbitrator is able to determine on the basis of the record
presented what the rating of the grievant's work product or
performance would have been under the established elements and
standards, if they had been applied, or if the violation of law,
regulation, or the collective bargaining agreement had not
occurred, the arbitrator may direct management to grant the
grievant that rating. If the record does not enable the
Arbitrator to determine what the grievant's rating would have
been, the arbitrator should direct that the grievant's work product or performance be reevaluated by management as
appropriate.
In our view, management's rights under section 7106(a)(2)(A)
and (B) do not warrant finding awards deficient on the basis that
in directing a rating change, arbitrators substitute their
judgment for that of management. In Newark Air Force Station, we
rejected the argument that enabling arbitrators to substitute
their judgment for that of management precluded the arbitrability
of grievances challenging the legality of performance standards
before employees were evaluated under the standards. We stated,
slip op. at 20-21:
Resolution of the grievance in this case by an arbitrator
would not require an arbitrator to do anything other than what
arbitrators do routinely in resolving other disputes, including
those involving the exercise of other management rights such as
discipline. An arbitrator would simply be examining an action by
management to determine whether that action was lawful . . . .
This is precisely one of the functions that arbitrators
perform, and that Congress intended that arbitrators perform,
under the Statute. In requiring parties to negotiate grievance
procedures that result in binding arbitration, and in broadly
defining what grievances could encompass, Congress fully expected
arbitrators to review a wide variety of actions, including
actions taken by management pursuant to section 7106.
For the reasons expressed in Newark Air Force Station, we
reject the previous Authority holdings that arbitrators may not
substitute their judgment for that of management by directing
management to grant employees the performance ratings they would
have received if they had been appraised properly. The
application of elements and standards obviously involves the
exercise of judgment by management officials. We find no basis in
the Statute or the legislative history for continuing to hold
that this judgment must be exercised by management alone. In
resolving these cases under the approach we have announced, an
arbitrator will not be exercising any additional authority beyond
that which they routinely exercise in resolving other grievances,
including those that involve the exercise of other
management rights. For example, arbitrators routinely resolve
under the Statute and the Civil Service Reform Act grievances
over whether disciplinary action was warranted and, if so,
whether the penalty assessed was appropriate.
Under the new approach, an arbitrator should examine
management's application of the elements and standards to
determine whether established elements and standards were applied
in accordance with law, regulation, and the collective bargaining
agreement. We believe that these examinations and determinations
are consistent with congressional intent concerning the functions
performed by arbitrators in resolving grievances under the
Statute. To the extent that the resolution of grievances by
arbitrators in this manner conflicts with section 7106(a)(2)(A)
or (B), that conflict results from implementation of
congressionally mandated grievance and arbitration procedures.
Consequently, decisions of the Authority which preclude
arbitrators from resolving grievances in this manner will no
longer be followed.
V. Conclusions
Applying the principles reaffirmed above and the new
approach to the remedial authority of arbitrators in performance
appraisal cases, we conclude that the award in this case is
contrary to section 7106(a)(2)(A) and (B) because the Arbitrator
exceeded his authority and improperly altered the content of the
established performance standard.
The Arbitrator stated the following concerning the
grievant's performance appraisal:
The Union would have me hold that the WCAP listings is not a
proper measure. I was not sufficiently convinced so to hold. I am
however amazed that the actual WCAP listings which are the
supporting documentation for the Agency's conclusion, were
discarded by management. They were discarded even before the end
of the fifteen (15) day limit to file a grievance and therefore
the supporting documentation did not exist at any time during the
processing of the grievance. The Agency seems to suggest that I
simply take their word. In this area of dispute, I cannot. I
therefore rule that the reference to the WCAP listings are not to
be considered as part of the review or appraisal. With that
elimination the text then supports a Level 3. Award at 4
(emphasis added). The Arbitrator's remedy results from his ruling
that the grievant's performance under GJT #6 must be evaluated
without consideration of the WCAP listings. Although the
Arbitrator refused to find that WCAP listings were not proper
measures of performance, he ordered the grievant's performance
rating changed by excluding consideration of the work represented
by those listings.
The Arbitrator did not determine that the existing standards
were improperly applied to the grievant. Furthermore, the
Arbitrator did not simply determine what the grievant's rating
would have been under the established elements and standards. The
Activity's actions in discarding the listings precluded such a
determination by the Arbitrator. Instead, the Arbitrator
determined what the grievant's rating would have been under
standards different from those established by the Activity for
the grievant and applicable to other employees. Thus, the
Arbitrator improperly altered the content of the performance
standards established by management in order to evaluate the
grievant at level 3.
The Arbitrator's award is based on his determination of what
work may be considered in evaluating the grievant under GJT #6.
Therefore, the award is contrary to management's rights under
section 7106(a)(2)(A) and (B) to establish performance standards.
See Social Security Administration. Office of Hearings and
Appeals, 21 FLRA 672.
Consistent with the new approach described above, the
Arbitrator was authorized to cancel the grievant's performance
rating. Moreover, if the Arbitrator had determined what the
grievant would have been rated under the established standard if
she had been appraised properly, he was authorized to direct that
the Activity grant the grievant that rating. The Arbitrator did
not do so, however. Rather than determine the appropriate rating
under the existing standards, the Arbitrator determined what the
rating would be if the standard were altered to exclude
consideration of WCAP listings.
VI. Decision
The Arbitrator's award is contrary to section 7106(a) of the
Statute and must be modified. Because the Arbitrator determined
that the grievant's appraisal was not in accordance with the
parties' memorandum of understanding and that her
progress reviews were not timely, the award is modified to
provide as follows:
Management shall reevaluate the grievant in accordance with
the Activity's performance appraisal system, the parties'
memorandum of understanding, and reconstructed work control
access program listings for the period ending September 30,
1986, and shall apply that rating in determining her summary
appraisal for the appraisal period in dispute.
Issued, Washington, D.C.,January 28, 1988.
Jerry L. Calhoun, Chairman
Jean McKee, Member
FEDERAL LABOR RELATIONS AUTHORITY