73 FLRA No. 6

 

FEDERAL EDUCATION ASSOCIATION
STATESIDE REGION
(Union)

and
 

UNITED STATES

DEPARTMENT OF DEFENSE
EDUCATION ACTIVITY
DOMESTIC DEPENDENT ELEMENTARY AND SECONDARY SCHOOLS
(Agency)

 

0-AR-5656

 

_____

 

DECISION

 

May 26, 2022

 

_____

 

Before the Authority:  Ernest DuBester, Chairman, and

Colleen Duffy Kiko and Susan Tsui Grundmann, Members

 

1. Statement of the Case

    

   The Union grieved the Agency’s decision to change certain positions in the excepted service to the competitive service when it filled vacancies or new positions.  Arbitrator Kurt Saunders found that the grievance was procedurally, but not substantively, arbitrable.  The Agency challenges the Arbitrator’s procedural-arbitrability determination on essence grounds.  Because the Agency does not demonstrate that the Arbitrator’s procedural-arbitrability determination fails to draw its essence from the parties’ collective-bargaining agreement, we deny the Agency’s essence exception.

    

   The Union challenges the Arbitrator’s substantive arbitrability determination on contrary-to-law grounds.  Because the Arbitrator’s                            substantive-arbitrability determination is contrary to Authority precedent, we grant the Union’s exception.  Therefore, we remand the award to the parties for resubmission to the Arbitrator, absent settlement, for a decision on the merits of the grievance.  And because we remand the award, we find it unnecessary to resolve the Agency’s exceeded-authority exception and the Union’s remaining contrary-to-law exception at this time.

    

2. Background and Arbitrator’s Award

    

On July 31, 2017, the Agency notified the Union that it would change certain professional positions previously designated as “[e]xcepted [s]ervice” to “[c]ompetitive [s]ervice.”[1]  In its notice, the Agency stated that for those positions, it would fill vacancies using “the hiring authorities/options under Title 5                (Competitive Service) as the appropriate source,” but that employees who currently encumbered any affected position would remain in the excepted service.[2]  In response, the Union filed an institutional grievance alleging that the Agency did not have the authority to implement the change and that filling bargaining-unit vacancies is “covered by” the parties’ agreement.[3]  The Agency denied the grievance and the Union advanced it to arbitration.

 

The Arbitrator framed four issues: 

 

1.  Are the Union’s claimed contractual violations procedurally barred based on the language in Article 27 § 3 or Article 27 § 5a?

2.  If not, is the Union’s challenge to the Agency’s decision to change positions from the Excepted Service to the Competitive Service a grievable issue?

3.  Did the Agency provide the Union with appropriate notice as required by Article 7 § 2a of the anticipated adverse effects of such change on Article 22 § 3.d of the contract?  If not, what is the remedy?

4.  If arbitrable on the merits, did the Agency violate Article 22 and/or 10 [U.S.C. §] 2164 when it changed specified positions in the bargaining unit from Excepted Service to Competitive Service?  If so, what is the appropriate remedy?[4]

 

On the first issue, the Arbitrator found that the Union’s claimed violation of Article 22 was not procedurally barred by Article 27, Section 3 (Section 3).[5]  Article 22, Section 3.d provides that “[i]n selecting a source of recruitment from which to fill a position, the selecting Agency official will first consider permanent [Domestic Dependent Elementary Secondary Schools] employees for the position.”[6]  Where the grievance referred to “the filling of vacancies” being “covered by” the parties’ agreement, the Arbitrator concluded that this “[could] only be viewed as a reference to Article 22.”[7]  In reaching this conclusion, the Arbitrator found it “significant” that the Agency inferred, and rejected, a claimed violation of Article 22 in its grievance response.[8]  The Arbitrator also rejected the Agency’s argument that the Union’s notice of witness testimony was contrary to Article 27, Section 5.a (Section 5a) and therefore, the grievance should be dismissed.[9]  On this point, the Arbitrator noted that Section 5a did not require notice of “actual” testimony, and that, even “assuming” the Union’s witness notice failed to comply with Section 5a, that provision did not require dismissal of the grievance as a remedy.[10] 

 

On the second issue, as relevant here, the Arbitrator stated that because “filling positions and hiring” are “exclusive” management rights under § 7106 of the Federal Service Labor‑Management Relations Statute     (the Statute), the choice of “service platforms under which these processes play out to complete hiring must also be held to be exclusive management rights.”[11]  And he concluded that “subjects that are exclusive management rights are not grievable.”[12]  Therefore, the Arbitrator did not address the merits of the Union’s claims that the Agency violated 5 U.S.C. § 2164 or Article 22 of the parties’ agreement.

 

Despite finding the grievance not arbitrable, the Arbitrator addressed the third issue, stating that a question remained as to whether the “the Agency provided appropriate notice to the Union of a change in working conditions affecting Article 22.”[13]  On this issue, he found that bargaining-unit employees were adversely affected by the change because those employees whose positions remained in the excepted service were not given first consideration for positions, as required by Article 22, Section 3.d, and were instead deemed ineligible to apply for positions that were changed to the competitive service.  The Arbitrator concluded that when this adverse effect became apparent, the Agency had a contractual obligation to advise the Union of this change in working conditions but did not do so.  As a remedy, the Arbitrator directed the Agency to give the Union an opportunity to submit impact and implementation proposals regarding employees adversely affected by the change.

 

On July 20, 2020, both the Union and the Agency filed exceptions to the award.  On August 19, 2020, each party filed an opposition to the other’s exceptions.

 

1. Analysis and Conclusions

    

   A.            The Arbitrator’s procedural-arbitrability determination draws its essence from the parties’ agreement.

    

   The Agency argues that the Arbitrator’s determination that the grievance is procedurally arbitrable fails to draw its essence from Sections 3 and Section 5a.[14]  The Authority will find that an arbitration award is deficient as failing to draw its essence from the     collective-bargaining agreement when the appealing party establishes that the award:  (1) cannot in any rational way be derived from the agreement; (2) is so unfounded in reason and fact and so unconnected with the wording and purposes of the agreement as to manifest an infidelity to the obligation of the arbitrator; (3) does not represent a plausible interpretation of the agreement; or (4) evidences a manifest disregard of the agreement.[15] 

    

   The Agency first argues that the award fails to draw its essence from Section 3 because the Arbitrator found that the Union had alleged a violation of Article 22 before arbitration by relying on a “presumption of arbitrability.”[16]  Contrary to the Agency’s assertion, the Arbitrator did not rely only on a “presumption”[17] to find that Section 3 did not bar the grievance.[18]  Rather, he found that the grievance’s reference to the parties’ agreement, in context, “can only be viewed as a reference to Article 22,” and that it was “significant” that the Agency relied on Article 22 in its grievance response.[19]  Therefore, he concluded that Article 22 was raised before arbitration, as required by Section 3.  The Agency’s disagreement with this conclusion does not demonstrate that the award is irrational, implausible, or in manifest disregard of the agreement.[20]

    

   Next, the Agency asserts that the award fails to draw its essence from Section 5a because the Arbitrator denied the Agency’s request to dismiss the grievance based on the Union’s alleged failure to identify before arbitration that a witness would testify regarding arbitrability.[21]  On this point, the Arbitrator found that Section 5a does not require the Union’s witness list to identify “actual” testimony and also does not require dismissal of a grievance, even “assuming” that the Union had failed to comply with it.[22]  Although the Agency takes issue with the Arbitrator’s discussion, it does not identify any wording in Section 5a that is contrary to the Arbitrator’s findings.  Therefore, the Agency has not demonstrated that the award fails to draw its essence from Section 5a.[23]

    

   Accordingly, we deny the Agency’s essence exceptions.[24]

    

    

    

    

    

    

    

    

   B.            The Arbitrator’s substantive-arbitrability determination is contrary to law.

    

   The Union argues that the Arbitrator’s conclusion that the grievance is not substantively arbitrable because it concerns management’s right to hire under § 7106(a)(2)(A) of the Statute[25] is contrary to law.[26]  The Authority has repeatedly held that the management rights provisions of § 7106 do not provide a basis for finding a grievance non-arbitrable.^[27]  Therefore, the Arbitrator erred by finding that the grievance was not arbitrable based on § 7106(a).[28]  Accordingly, we grant the Union’s contrary‑to‑law exception, and set aside the Arbitrator’s finding that the grievance was not substantively arbitrable. 

    

   When an arbitrator incorrectly concludes that a grievance is not substantively arbitrable, the Authority has consistently remanded the award to the parties for resubmission to the arbitrator, absent settlement, for a decision on the merits.[29]  Although the Union and the Agency challenge the Arbitrator’s resolution of the third issue on contrary-to-law[30] and exceeded-authority grounds,[31] respectively, the Arbitrator’s discussion on that issue is non-binding dicta because he found that the grievance was not arbitrable.[32]  Accordingly, and in light of our decision to remand this case, we do not address the parties’ arguments on this issue.^[33]

    

2. Decision

    

   We deny the Agency’s essence exceptions, grant the Union’s contrary-to-law exceptions, in part, and remand this matter to the parties for submission, absent settlement, to the Arbitrator to resolve the merits of the grievance.