shaw bransford & roth case law update

FLRA Denies Agency Exceptions to Arbitrator Award Cancelling Subjective Performance Elements

An Office of Personnel Management senior accountant, through her Union, grieved her annual performance rating of “exceeds fully successful” both overall and in two critical elements of her performance plan.

In the only two other critical elements of the performance plan, the employee had been rated “outstanding.” Due to her rating of “exceeds fully successful” overall rather than outstanding, the employee was not eligible for a cash award and did not receive one. The arbitrator assigned to the matter found that the Agency had “violated applicable law when the Agency rated the [employee] as exceeds fully successful (EFS) for two critical elements of her performance plan” because the performance standards at issue were not based on objective criteria, and were therefore invalid. The arbitrator therefore cancelled the two EFS ratings, and directed the Agency to change one of the critical elements to “outstanding” and to “reevaluate the [employee’s] performance for critical element three according to the clarified performance plan.” After receiving the arbitrator’s award direction, the Agency filed exceptions to the award with the Federal Labor Relations Authority. On September 30, 2015, the Federal Labor Relations Authority held that the arbitrator’s award was not contrary to law.

The Authority considered three questions: (1) whether the arbitrator erred as a matter of law by impermissibly affecting the agency’s management rights to direct employees and assign work when he directed the agency to change the employee’s rating or misapplied MSPB precedent through his citations to Greer v. Department of the Army, 79 M.S.P.R. 477, 483 (1998); (2) whether the award failed to draw its essence from the parties’ agreement because there was no finding of a violation of the agreement; and (3) whether the award is so incomplete, ambiguous, or contradictory as to make its implementation impossible.

The Authority noted that it has consistently held that an arbitrator’s cancellation of an employee’s performance rating affects management’s rights to direct employees and assign work, and found the same in this matter. However, the Authority stated, even when management’s rights are affected, the award is valid if the arbitrator was enforcing either a negotiated contract provision or an “applicable law.” Because the arbitrator was enforcing an “applicable law” within the meaning of 5 U.S.C. § 7106(a)(2), the arbitrator applied the Greer decision of the MSPB, which “enforces the objectivity requirement for performance standards under 5 U.S.C. § 4302(b)(1). Section 4302(b)(1) of Title 5 requires that the basis of an agency’s evaluation of an employee’s job performance be objective criteria, and the Authority found that the arbitrator was enforcing that statutory objectivity requirement.

Although the dissent claimed that performance standards can only be challenged under § 4302(b)(1) in conjunction with a removal or demotion action, the majority of the Authority disagreed, stating that arbitrators, like the MSPB and Federal Circuit, “have the power to consider whether performance standards comply with applicable legal requirements.”

Moving to the second question, the Authority found that the agency’s argument “[lacked] merit because, as discussed above in the contrary-to-law section, the arbitrator found that the Agency violated an applicable law, and the Agency has not otherwise demonstrated that the arbitrator was required to find a violation of the parties’ agreement to support the remedy he awarded.”

As to the agency’s argument that the arbitrator’s award was “inherently contradictory” due to arbitrator’s finding that the agency reevaluate the employee’s rating under critical element three under “those same performance standards” that the arbitrator found unreasonable and unduly subjective, the Authority observed that the arbitrator had not directed the agency to reevaluate the rating under identical standards, and had “clarified the grievant’s performance plan to reflect her duties.” The Authority held that the Agency had not explained how the “meaning and effect of the award is contradictory or why the award will be impossible to implement.”

For the above stated reasons, the Federal Labor Relations Authority denied the Agency’s exceptions to the arbitrator’s award.

Read the full decision: United States Office of Personnel Management (Agency) and American Federation of Government Employees, Local 32 (Union)


This case law update was written by Conor D. Dirks, associate attorney, Shaw Bransford & Roth, PC.

For thirty years, Shaw Bransford & Roth P.C. has provided superior representation on a wide range of federal employment law issues, from representing federal employees nationwide in administrative investigations, disciplinary and performance actions, and Bivens lawsuits, to handling security clearance adjudications and employment discrimination cases.

Posted in Case Law Update

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