Petition for Writ of Certiorari — American Federation of Government Employees, Local 1617 v. Federal Labor Relations Authority

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No. O4 438 SEP 27 2004

OFFICE OF THE CLERK

IN THE

Supreme Court of the United States

AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES,

LOCAL 1617; ARTHUR CELESTINO; AMERICAN FEDERATION

OF GOVERNMENT EMPLOYEES,COUNCIL NUMBER 214,

Petitioners,

Vv.

FEDERAL LABOR RELATIONS AUTHORITY,

Respondent.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Fifth Circuit

PETITION FOR A WRIT OF CERTIORARI

HAL K. GILLESPIE *

GILLESPIE, ROZEN, WATSKY,

& MOTLEY, P.C.

3402 Oak Grove Avenue, Suite 200

Dallas, Texas 75204

* Counsel of Record - (214) 720-2009

WILSON-EPES PRINTING Co., INC. — (202) 789-0096 — WASHINGTON, D.C. 20001

® GS ©

QUESTIONS PRESENTED

1. Does the Steelworker Trilogy apply to FLRA review of

arbitration decisions pursuant to collective bargaining

agreements of federal employees?

2. If the FLRA overturns an arbitrator’s interpretation of a

collective bargaining agreement, does the district court have

subject matter jurisdiction to restore the arbitration award?

LIST OF PARTIES AND RULE 29.6 LIST

The parties before the Court of Appeals and this Court are

listed below. To Petitioners’ knowledge, the Federal Labor

Relations Authority has no parent companies or non-wholly

owned subsidiaries.

American Federation of Government

Employees, Local 1617 Plaintiff/Petitioner

Arthur Celestino Plaintiff/Petitioner

American Federation of Government

Employees, Council Number 214 Plaintiff/Petitioner

Hal K. Gillespie Attorney for

Plaintiff/Petitioner

Federal Labor Relations Authority Defendant/Respondent

James F. Blandford Attorney for

Defendant/Respondent

Solicitor General of the Attorney for

United States Defendant/Respondent

TABLE OF CONTENTS

A. Nature of the Case and Proceedings Below.......

B. Pactual Background ..................:c0ceseccsccsosesesssess.

REASONS FOR GRANTING THE WRIT ......ccc0000.-

A. The Court Should Grant Certiorari because of

a Split in the Circuits over whether the Federal

Labor Relations Authority is restricted in its

review of arbitration awards under the

guidelines in the Steelworkers Trilogy ............. |

1. Background to the FLRA’s authority under

i ET

. The Court Should Grant Certiorari Because the

Fifth Circuit has decided an important federal

question in a way which conflicts with

relevant decisions of this Court in the

Steelworkers Trilogy and Leedom v. Kyne ........

(iii)

TABLE OF CONTENTS—Continued

Page

C. The Court Should Grant Certiorari Because the

Fifth Circuit’s Holding that the Steelworkers

Trilogy opinions do not provide guidance on

its jurisdiction over FLRA decisions is an

important question of federal law that has not

been, but should be, settled by this Court.......... 19

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Ft. ee ae sronensecsenesorscerscesees la

TABLE OF AUTHORITIES

CASES Page

Boire v. Greyhound Corp., 376 U.S. 473 (1964)... 15, 18

Board of Governers of the Fed. Reserve vy.

MCorp Financial Inc., 502 U.S. 32 (1991)....... 15, 16

‘Circuit City Stores v. Adams, 532 U.S. 105

UIE as.sscsiascsianicashnepelebiciiniietsdnsibaiiatioesiamecseasicdaetiaaienes 23

Cornelius v. Nutt, 472 U.S. 648, 662 (1985)......... 12

Devine v. White, 697 F.2d 421, 440 (D.C. Cir.

DOIN ivscssncccsoesstictoismetinainns tasscsaniplsenccadicetasainidiyaie 12

Gilmer vy. Interstate/Johnson Lane Corp., 500

Shs BOP WED vctisiniisekseesvetuensianieiacapteuiiaunedldtigeles 23

Leedom v. Kyne, 358 U.S. 184, 79 S.Ct. 180

is dnsccnsstisnnehuleiibiscianictibinionntnianaabuanateaies 3, 6, 9, 15-18

Saraw Partnership v. United States, 67 F.3d 567,

eR Cree CR Fe ecctncctntnsiotcentntenslscihpenpintsiaates 19

Suzal v. Director, United States Information

Agency, 32 F.3d 574, 578 (D.C. Cir. 1994)....... 16

United Steelworkers v. Enterprise Wheel & Car

Carp, FOF US. TFS GPG) scinratonnssitevssnnvel 9, 13, 19-22

United Steelworkers v. American Manufacturing

CO, FES US. FOG CI vvecicscsctsicnsasianenouninioes 9, 20-22

United Steelworkers v. Warrior & Gulf Navi-

gation Co., 363 U.S. 574 (1960).......ccccseeeeerees 9, 20

United Paperworkers v. Misco, Inc., 484 U.S. 29

PIE ii sisctainissnidacsatascnchsevetecdecinesenacgrnmeneciacnatnea 18, 20-22

United States Dept. of Justice v. FLRA, 981 F.2d

1339, 1344, n2 (D.C. Cir. 1993)......... ssidaanales rie 12

United States Dept. of Treasury, Customs

Service v. F.L.R.A., 43 F.3d 682, 686-687

CI Cle. FSGS) vciccnsceracecetpiemematinmadiaaaionans 12-14

TABLE OF AUTHORITIES—Continued

ARBITRATION RULINGS AND FEDERAL Page

LABOR RELATIONS AUTHORITY RULINGS

American Federation of Government Employees

Local Union No. 1617 and San Antonio Air

Logistics Center, Kelly Air Force Base, San

Antonio, Texas FMCS Case No. 99-17655........ 5

United States Dept. Of Air Force, San Antonio

Air Logistics Ctr., Kelly Air Force Base San

Antonio, Tex., 58 F.L.R.A. 63 (2002)...........000- 7

United States Dept. Of Air Force, San Antonio

Air Logistics Ctr., Kelly Air Force Base San

Antonio, Tex., 58 F.L.R.A. 71, (2002)...........00. 7

United States Dept. of Army, Fort Campbell

Dist., v. American Federation of Government

Employees, Local 2022, 37 (F.L.R.A. 1990)..... 9

United States Dept. of Health and Human

Services v. AFGE Council 147, 38 FLRA

BEA: EE Cee iimniccnidesncnorcansestaaaaaecs 23

United States Dept. of Labor (OSHA) and

National Council of Field Labor Locals, 34

PERA 573, SIG OID voici ees 23

STATUTES

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TABLE OF AUTHORITIES—Continued

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RULES

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SUPPLEMENTAL AUTHORITY

H.R. Conf. Rep. No. 1717, 95th Cong., 2nd Sess.

eased heheh cecaasiliesnciheenassaisetenecnanedsieiineaciins 11,14

Elkouri & Elkouri, How Arbitration Works,

1300-1301, (Ruben ed., 6th ed. 2003)............... 22

IN THE

Supreme Court of the United States

No.

AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES,

LOCAL 1617; ARTHUR CELESTINO; AMERICAN FEDERATION

OF GOVERNMENT EMPLOYEES,COUNCIL NUMBER 214,

Petitioners,

FEDERAL LABOR RELATIONS AUTHORITY,

Respondent.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Fifth Circuit

PETITION FOR WRIT OF CERTIORARI

American Federation of Government Employees, Local

1617, Arthur Celestino, and American Federation of Govern-

ment Employees, Council Number 214 pray for a writ of

certiorari to review the opinion of the United States Court of

Appeals for the Fifth Circuit, rendered in these proceedings

on June 29, 2004.

OPINIONS BELOW

The unpublished opinion of the United States Court of

Appeals for the Fifth Circuit is contained in the Appendix.

See App. A. A copy of the Order Accepting Report and Rec-

ommendation of United States Magistrate Judge of United

States District Court for the Western Division of Texas is

contained in the Appendix. See App. B. A copy of the

decision of the Federal Labor Relations Authority is con-

tained in the Appendix. See App. C. Excerpts relevant for

the Court’s review of this petition for certiorari of the 286

page arbitration opinion and award are also contained in the

Appendix. See App. D

JURISDICTION

This Court’s jurisdiction is invoked under 28 U.S.C.

§ 1254(1) to review a decision of the United States Court of

Appeals for the Fifth Circuit by writ of certiorari after

rendering judgment. The decision for which review is sought

was entered on June 29, 2004. Pursuant to this Court’s Rule

13.1, this petition for writ of certiorari is timely because it is

being filed within ninety days after entry of judgment.

STATUTES INVOLVED

This case involves the Federal Labor Management Rela-

tions Act (the FLMRA), 5 U.S.C. §7101 et seg. Of particular

relevance in this case are:

5 U.S.C. § 7101 which states the Findings and Purpose

of the FLMRA, indicating it is in the public interest to

protect the right of employees to organize, bargain

collectively, and participate through labor organizations

of their own choosing in decisions which affect them.

5 U.S.C. § 7102 which states that federal sector em-

ployees are granted the right to engage in collective

bargaining with respect to conditions of employment

through representatives chosen by employees under this

chapter.

5 U.S.C. § 7104 which establishes the creation of the

Federal Labor Relations Authority.

5 U.S.C. § 7105(a)(2)(H) which grants the FLRA

authority to resolve exceptions to arbitrator’s awards

pursuant to the limitations of §7122.

5 U.S.C. § 7122 which establishes the limitations of the

FLRA’s authority to review arbitration awards.

5 U.S.C. § 7123 which establishes judicial review and

enforcement of the FLMRA.

The Appendix contains the full text of these statutes pursuant

to Sup.Ct.R. 14.1(f). See App. E-J.

STATEMENT OF THE CASE ~—

A. Nature of the Case ard Proceedings Below

Petitioners filed their First Amended Complaint on March

18, 2003 seeking to reinstate an arbitration award which had

been overruled by the Federal Labor Relations Authority. In

October 2003, the district court granted the FLRA’s 12(b)(1)

motion to dismiss for lack of subject matter jurisdiction,

denied Petitioners’ cross-motion for summary judgment, and

dismissed for lack of subject matter jurisdiction. Petitioners

timely appealed to the United States Court of Appeals for

the Fifth Circuit. A three-judge panel of the Fifth Circuit

affirmed the judgment of the district court in June of 2004.

The FLRA contested the jurisdiction of the district court.

Petitioners contended the district court had jurisdiction over

Petitioners’ claims because the FLRA, reviewing the decision

of a labor arbitrator pursuant to 5 U.S.C. § 7105(a)(2)(H) and

7122, violated the teachings of the Steelworkers Trilogy by

substituting its interpretation of a collective bargaining

agreement for that of the arbitrator. By doing so, the FLRA

exceeded the limited scope of review for arbitration awards

conferred on it by Congress in 5 U.S.C. § 7122(a)(2). There-

fore, the district court had jurisdiction under the Leedom v.

Kyne exception to the foreclosure of judicial review under

federal acts, created in Leedom v. Kyne, 358 U.S. 184, 79

S.Ct. 180 (1958). Petitioners argued that because the district

court held subject matter jurisdiction under Leedom v. Kyne,

the district court also had general subject matter jurisdiction

under 28 U.S.C. §§ 1331, 1337, and 1361, and under 28

U.S.C. §§ 2201 and 2202, as Petitioners sought declaratory

relief and review of an action of an agency of the United

States pursuant to 5 U.S.C. §§ 702, 705, and 706.

The district court dismissed Petitioners’ claims claiming

a lack of subject matter jurisdiction. Petitioners timely

appealed this decision to the Fifth Circuit Court of Appeals.

On June 29, 2004 the Fifth Circuit affirmed.

B. Factual Background

Petitioners won their arbitration case that sought environ-

mental differential pay due to exposure on the job to

potentially harmful levels of airborne asbestos in a 286 page

arbitration decision dated October 9, 2001. The FLRA, in a

split decision, overruled and set aside the arbitrator’s opinion

and award. After the FLRA denied rehearing, Petitioners

sued in federal district court to reinstate the arbitrator’s award

and opinion and to require the FLRA to hear Petitioners’

exception concerning the limitation of remedy in the arbi-

tration opinion and award on grounds that the FLRA had

overstepped its statutory authority in overruling the arbi-

trator’s interpretation of the underlying parties’ collective

bargaining agreement. The district court dismissed Peti-

tioner’s suit for lack of subject matter jurisdiction and the

Fifth Circuit Court of Appeals affirmed.

Factually, this case arises out of an Environmental Differ-

ential Pay (“EDP”) grievance and arbitration filed by employ-

ees at Kelly Air Force Base (“KAFB”) in San Antonio,

Texas, seeking EDP and backpay for exposure to airborne

asbestos. -At all times pertinent to the underlying grievance

and arbitration, bargaining unit members at KAFB were

covered by a collective bargaining agreement entitled

“Master Labor Agreement” (“MLA”). EDP was covered in

the parties’ MLA and was subject to interpretation by the

arbitrator. Pursuant to the parties’ MLA, the parties selected

an arbitrator from the Federal Mediation and Conciliation

Service (FMCS) and a multi-week arbitration was held

regarding the EDP claims in FMCS Case No. 99-17655

before the Honorable Larry D. Smith. The parties stipulated

that the arbitrator was properly selecied, pursuant to the

parties’ collective bargaining agreement, and that the Arbi-

trator had jurisdiction to determine all the issues set forth in

the arbitrator’s opinion and award. (App. D, at 51a).

During the arbitration, KAFB contended that the Air Force

had issued regulations regarding EDP, which tied EDP to the

United States Occupational Safety and Health Adminis-

tration’s Permissible Exposure Limit (referred to as the

“OSHA PEL” standard) and that those regulations trumped

the agreement of the parties as found in the MLA. The Union

argued, and the arbitrator agreed, that the Air Force

regulations were in conflict with the MLA because the MLA

required a case-by-case analysis of entitlement to EDP,

specifically rejecting any predetermined level of entitlement.

Based on his interpretation of the MLA, Arbitrator Smith

issued a 286 page Award and Opinion that granted limited

EDP backpay and interest to the bargaining unit employees at

KAFB. (App. D) Arbitrator Smith’s opinion and award was

tied to his interpretation of the parties’ MLA in holding: “The

parties did not contractually agree to use the OSHA PEL as

the point of entitlement to EDP” and “the words of the MLA

were crafted with the apparent intent to incorporate the

bargaining objective of the Union to avoid any definition

of “practically eliminated.” (App. D, at 62a-63a, emphasis

added).

The arbitrator’s interpretation of the meaning of the “words

of the MLA” was supported by extensive evidence presented

during the arbitration regarding the intention of the parties in

drafting the MLA. Based on the evidence presented Arbi-

trator Smith found:

No credible evidence exists to show that the Union has

ever, from the bargaining table activity of the first MLA

to the time of the filing of this grievance, agreed that

EDP entitlement occurs only in the event of a breach of

the OSHA PEL. To the contrary, the Union has always

contended that EDP should be considered and decided

on a case-by-case basis without any strict reliance upon

the OSHA PEL or for that matter, any other specific

level of exposure.

(App. D, at 60a). Having interpreted the meaning of the

parties’ MLA, the Arbitrator, inter alia, retained jurisdiction

and made these findings:

10.

11.

The parties did not contractually agree to use the

OSHA PEL as the point of entitlement to EDP. . .

Bargaining unit employees have been exposed to

airborne concentrations of asbestos fibers. . .

It is reasonably possible that such exposure may

result in illness or injury.

Protective equipment or other safety device has not

essentially removed the possibility of such injury or

illness. a

The Agency violated Section 26.01 of the collective

bargaining agreement and such a violation is an

unwarranted and/or unjustified personnel act.

The Agency’s unwarranted and/or unjustified per-

sonnel act entitles employees to compensation

pursuant to the Back Pay Act, in order to remedy

the failure of the Agency to pay an environmental

differential in violation of Article 26.01.

(App. D, at 67a-68a).

After the arbitration award, KAFB filed exceptions with

the FLRA to overturn the arbitrator’s ruling. KAFB’s

primary exception to the arbitrator’s ruling was that the Air

Force regulation was “not inconsistent with the parties’

MLA.” The Union responded to KAFB’s exception by

pointing out that the arbitrator had specifically ruled that

the parties’ MLA was contrary to the Air Force’s uni-

lateral regulation.

On September 11, 2002, over the dissent of Member Pope,

the FLRA set aside the arbitration award in its entirety on

grounds that the Air Force regulations “do not conflict with

the collective bargaining agreement,” and the Air Force

regulations “are specifically linked to the payment of EDP.”

In overturning the Arbitrator’s decision, the FLRA had

to first disagree with the Arbitrator’s interpretation of the

parties’ MLA, and then make its own interpretation of the

MLA. Obscuring this key fact—that the FLRA had to reject

the arbitrator’s interpretation of the MLA before making its

own interpretation the MLA—is the FLRA’s portrayal of its

rejection of the Arbitrator’s interpretation of the MLA as an

agreement with the Arbitrator’s interpretation of the MLA.

The FLRA does this in a single sentence of its majority

opinion, stating:

On the basis of the Arbitrator’s interpretation of the

agreement, we find that the [Air Force regulations] do

not conflict with provisions of the agreement.

The FLRA further occludes its re-interpretation of the MLA

by taking small portions of the Arbitrator’s own language and

' United States Dept. Of Air Force, San Antonio Air Logistics Ctr.,

Kelly Air Force Base San Antonio, Tex., 58 F.L.R.A. 63 (2002). (App. C).

In addition to rending the September 11, 2002 opinion which set aside the

arbitrator’s opinion and award of backpay, the FLRA issued a “supple-

ment order” regarding a subsequent order of the arbitrator in which the

arbitrator ordered the facilitation of the backpay award and differed on the

issue of attorneys fees. United States Dept. Of Air Force, San Antonio

Air Logistics Ctr., Kelly Air Force Base San Antonio, Tex., 58 F.L.R.A.

71, (2002).

making it appear that the FLRA and the Arbitrator agree on

the interpretation of the MLA.

While the FLRA majority purports to agree with the arbi-

trator’s interpretation of the parties’ MLA, the holdings of

Arbitrator Smith and the F LRA (majority) on the meaning of

the MLA are incongruous. Per the majority FLRA Opinion,

because the MLA did not set a specific threshold standard for

payment of asbestos related EDP,’ the Air Force regulation

Setting a specific standard was not inconsistent with the

MLA. This reasoning is pure contract interpretation of the

worst sort, in that it would deny the parties the right to agree

that instead of having a specific threshold Standard for

entitlement to EDP, the entitlement could be determined on a

case-by-case basis by an arbitrator if the parties disputed

entitlement. The contract interpretation by the FLRA

majority was the Opposite of the contract construction of

Arbitrator Smith, who found that the MLA was inconsistent

with the Air Force regulation, which limited EDP awards for

asbestos exposure to cases where exposure at the OSHA PEL

could be established, because the MLA rejected any attempt

to establish a specific standard, including but not limited to

the OSHA PEL.

FLRA Member Pope’s dissent faults the majority for inter-

fering with the arbitrator’ s interpretation of the MLA:

The majority distorts the award by relying on the Arbi-

trator’s statements that Article 26.01 contains “no

specific standard” to trigger EDP and that the parties had

not “‘agree[d] to a specific standard.’” Majority at 13. It

is clear, in this regard, that in finding the parties did not

agree to a specific standard, the Arbitrator found that

they did not agree to a specific predetermined quan-

“a specific threshold standard-the OSHA PEL-—was what the Air

Force sought in bargaining and did not get, per the findings of the arbi-

trator. Arbitrator Smith specifically discredited the testimony of Agency

witnesses and credited Union witnesses on this issue.

titative standard. As noted above, the Arbitrator unde-

niably rejected the Agency’s argument that the Union

had agreed to adopt the OSHA standard and found, as a

matter of contract interpretation, that the agreement

incorporated the Union’s position that the standard

would be determined case-by-case in arbitration. Thus,

the majority is permitting the Agency to accomp

lish precisely what Fort Campbell? prohibits: trumping

a collective bargaining agreement with a conflicting

Agency regulation.

(App. C, at 40a) (emphasis added).

REASONS FOR GRANTING THE WRIT

Powerful reasons exist for granting certiorari. The Fifth

Circuit’s decision in AFGE 1617 v. FLRA (App. A) deepens a

split between the circuits on an important matter of federal

law regarding the extent to which the FLRA’s authority to

review arbitration awards is limited by the Steelworkers

Trilogy * and “on other grounds similar to those applied by

Federal courts in private sector labor-management relations.”

In addition to the split among the circuits, the Fifth Circuit’s

decision in AFGE 1617 decides important questions of

federal law in a way that conflicts with this Court’s holdings

in the Steelworker Trilogy and Leedom vy. Kyne.° Finally,

certiorari should be granted because AFGE 1617 decides

crucial questions of federal law which have not, but should

> United States Dept. of Army, Fort Campbell Dist., v. American Fed-

eration of Government Employees, Local 2022, 37 (F.L.R.A. 1990).

* United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593,

(1960); United Steelworkers v. American Manufacturing Co., 363 U.S.

564 (1960); and United Steelworkers v. Warrior & Gulf Navigation Co.,

363 U.S. 574 (1960).

> Leedom v. Kyne, 358 U.S. 184, 79 S.Ct. 180 (1958)(holding that gen-

eral subject matter jurisdiction is vested in district courts when an agency

acts beyond its authority as granted within its enabling statute).

be, settled by this Court in order to solidify and uphold

federal sector employees’ rights to collective bargaining

under the Federal Labor-Management Relations Act, 5 U.S.C.

§7101 et. seg. (“FLMRA” or “Act”).

A. The Court Should Grant Certiorari because of a

Split in the Circuits over whether the Federal

Labor Relations Authority is restricted in its

review of arbitration awards under the guidelines

in the Steelworkers T, rilogy.

There is a split in the circuits about whether the Stee/-

workers Trilogy, with its high level of deference to arbi-

trators’ interpretation of collective bargaining agreements,

places any limits on the FLRA’s authority to review arbitral

awards in the federal sector.® Currently, only the District of

Colombia Circuit has addressed this necessary restriction on

the FLRA’s authority.

1. Background to the FLRA’s Authority under

the FLMRA

The FLRA is a three member panel mandated in 5 U.S.C.

§ 7104 that draws its powers and duties from § 7105 of the

Act. Specifically, § 7105(a)(2)(H) of the Act gives the FLRA

the limited power and duty to “resolve exceptions to

arbitrator’s awards under section 7122” of the Act. Section

7122 limits the FLRA’s review power by specifying that the

FLRA may only review exceptions to an arbitrator’s award if

that award is, “deficient (1) because it is contrary to any law,

° The Fifth Circuit opinion finesses the impact of the Steelworkers

Trilogy, by holding that these opinions “do not provide guidance on [its]

jurisdiction over FLRA decisions.” (App. A, at 9a). Under Leedom,

however, if the Steelworkers Trilogy guidelines are statutorily imposed on

the FLRA under 5 U.S.C. § 7122(a)(2) and the FLRA violates this statu-

tory limitation on its review authority, the Steelworkers Trilogy opinions

necessarily affect federal court jurisdiction.

SA Re TE ION NIE EI PR BS PB Oe re eee owt

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rule, or regulation; or (2) on other grounds similar to those

applied by Federal courts in private sector labor man-

agement relations.” 5 U.S.C. § 7122(emphasis added). This

limited framework of authority is further restricted in that the

FLRA’s actions and recommendations upon an arbitration

decision must be, “consistent with applicable laws, rules, or

regulations.” 5 U.S.C. § 7122.

The FLMRA went into effect nearly twenty (20) years after

the Steelworkers Trilogy and expressly limits the FLRA’s

review power of arbitration awards on, “grounds similar to

those applied by Federal courts in private sector labor-

management relations.” 5 U.S.C. § 7122. This language is

particularly important when matched with the language of the

legislative debates leading up to the creation of the FLMRA,

which show Congress’ clear intention was to severely limit

_ the FLRA’s authority to review arbitration decisions and to

hold such limitations in line with the federal courts’

limitations found in the Steelworkers Trilogy. In framing the

FLMRA, Congress declared that:

The Authority will only be authorized to review the

award of the arbitrator on very narrow grounds similar to

the scope of judicial review of an arbitrator’s award in

the private sector. In light of the limited nature of the

Authority’s review, the conferees determined it would be

inappropriate for there to be subsequent review by the

court of appeals in such matters.

H.R. Conf. Rep. No. 1717, 95th Cong., 2nd Sess. 153 (1978).

Upon reviewing this statutory history, it is clear that Congress

restricted the right of appeal under § 7123 of the Act because

under § 7122, the FLRA itself was restricted in its authority

to review arbitrators’ decisions when drawn from the essence

of the collective bargaining agreement.

2. Split in the Circuits

a. District of Columbia Circuit

The District of Columbia Circuit has analyzed the Civil

Service Reform Act and held that the policies favoring

extremely limited judicial review of arbitrators’ decisions are

fully applicable in the federal sector. Devine v. White, 697

F.2d 421, 440 (D.C. Cir. 1983) overruled on other grounds

by, Cornelius v. Nutt, 472 U.S. 648, 662 (1985). The District

of Columbia Circuit tracked the history of private sector and

federal sector arbitration through the application of the

Steelworkers Trilogy and concluded that, “the possible

grounds for treating arbitral decisions in the federal sector

less deferentially than private sector decisions cannot with-

stand careful scrutiny.” /d. at 439. The District of Columbia

explained further that while limited review of arbitral

decisions has been granted by Congress, this was done in an

effort to promote uniformity of process and adequately

protect the rights of government employees, but consistent

with private sector precedent, Congress has done so in a

manner that, “leaves arbitrators’ interpretations of collective

bargaining agreements themselves largely unreviewable.” Jd

at 440.

The District of Columbia Circuit has further tracked the -

implications of the Steelworkers Trilogy in its subsequent

holdings. In United States Dept. Of Justice y. FLRA, the

District of Columbia Circuit recognized the importance of

arbitration to the scheme established by the F LMRA, that

accords to the FLRA “extremely limited” review of those

arbitral awards that it has jurisdiction to review. United

States Dept. of Justice v. FLRA, 981 F.2d 1339, 1344, n.2

(D.C. Cir. 1993), citing to Devine at 436, relying on

Steelworkers, 363 U.S. at 597. The District of Columbia

applies this same analysis in United States Dept. of T reasury

v. United States Customs Service, holding that the merits of

an arbitrator’s award that implicates the collective bargaining

agreement are “absolutely immune from judicial review,” and

if the party’s exception to the arbitral award is not one of law,

but of contract, the FLRA’s role is limited to that of the

federal courts in private sector labor-management relations as

found in the Steelworkers Trilogy. United States Dept. of

Treasury, Customs Service v. F.L.R.A., 43 F.3d 682, 686-687

(D.C. Cir. 1995)(hereinafter, “Customs’’), citing to 5 U.S.C.

§7122(a)(2) and United Steelworkers vy. Enterprise Wheel &

Car Corp., 363 U.S. 593, 597 (1960).

b. Fifth Circuit

The holdings of the District of Columbia Circuit, which

establish that the FLMRA was created with Congress’ intent

to incorporate the high level of deference for arbitral awards

found within the Steelworkers Trilogy, are in stark contrast to

the Fifth Circuit’s holding in this case. The Fifth Circuit,

while ignoring Petitioners’ statutory history of the FLMRA,’

States that:

Appellants cite a series of three Supreme Court opinions,

the Steelworkers Trilogy, to support the proposition that

employment arbitrations are to be given a high degree of

deference. The Steelworkers Trilogy opinions, however,

deal with federal court review of employment arbitration

decisions, not federal court review of FLRA decisions.

The Steelworkers Trilogy opinions do not provide guid-

~ ance on this court’s jurisdiction over FLRA decisions.

(App. A, at 9a).

The Fifth Circuit has failed to directly determine to what

extent the FLRA is limited in its authority by the Stee/-

’ The Fifth Circuit interjects that Petitioners, “do not cite any legislative

history,” to support the proposition that Congress intended the FLRA’s

review authority of arbitral awards to track that of the Steelworkers

Trilogy. Contrary to the Fifth Circuit’s statement, Petitioners provided

citation to legislative history in both their brief and reply brief before

the court.

workers Trilogy guidelines, but by necessary implication, the

Fifth Circuit freed the FLRA to depart completely from those

guidelines and to liberally overrule the arbitrator’s inter-

pretation of a collective bargaining agreement.

The Fifth Circuit cites to the District of Columbia Circuit’s

decision in Customs, 43 F.3d 682, 686-87 (D.C. Cir. 1995)

for the proposition that if an arbitrator’s award is challenged

because it is allegedly contrary to a law, rule or regulation,

the FLRA must conduct a de novo review. (App. A, at 7a).

This misstatement of the Treasury holding exemplifies the

Fifth Circuit’s effort to expand the FLRA’s authority to strike

down arbitrator’s rulings in violation of Steelworkers Trilogy

principles as set forth in §7122(a)(2). The District of

Columbia actually held that “the merits of an arbitrator’s

collective bargaining agreement are, by virtue of the

categorical nature of this provision, absolutely immune from

judicial review.” Customs at 686. Additionally, the Fifth

Circuit twists the District of Columbia’s precedent further by

changing the holding from de novo review of the “legal

question” to de novo review of the arbitrator’s interpretation

of the collective bargaining agreement. The Fifth Circuit’s

incorrect analysis of Customs evidences the Fifth Circuit’s

effort to provide more authority to the FLRA than Congress

provided under § 7122(a)(2).

Compounding this problem, the Fifth Circuit addresses the

limited review of FLRA decisions on arbitral awards (as

found in § 7123), yet fails to recognize that the judiciary was

given limited review power of FLRA decisions under § 7123

because the FLRA, under § 7122(a)(2) was never intended a

scope of review that would affect an arbitrator’s decision

based upon a collective bargaining agreement. H.R. Conf.

Rep. No. 1717, 95th Cong., 2nd Sess. 153 (1978). Currently

the FLRA has carte blanc authority to overturn arbitrators’

awards that are based upon the arbitrator’s interpretation of a

collective bargaining agreement and no court within the Fifth

Circuit has the jurisdiction to reverse the F LRA to insure that

it complies with its Statutory mandate to conduct narrowly

limited review of arbitration decisions.

B. The Court Should Grant Certiorari Because the

Fifth Circuit has decided an important federal

question in a way which conflicts with relevant

decisions of this Court in the Steelworkers Trilogy

and Leedom vy. Kyne.

The Fifth Circuit’s holding in AFGE 1617 conflicts with

this Court’s decisions in both the Steelworkers Trilogy and

Leedom. While it is undisputed that Leedom jurisdiction is a

nalrow exception to a general preclusion of judicial review, it

is a necessary exception. The Fifth Circuit has strained to

further restrict the exception by ruling that the Steelworkers

Trilogy (which according to the District of Columbia Court of

Appeals, restricts the FLRA’s scope of review of arbitration

awards per statue) does not relate to jurisdiction. Nothing in

Leédom suggests that a federal agency is free from Leedom

jurisdiction when it exceeds its aut) ority in this manner.

In analyzing this Court’s Leedom precedent, the Fifth

Circuit reviewed Leedom, Boire y. Greyhound Corporation,

and Board of Governors of the Federal Reserve System v.

MCorp Financial, Inc. (MCorp)* and held that Leedom juris-

diction does not exist when there is evidence of congressional

intent to deny district court review, the statute provides an

adequate opportunity for judicial review, and the action of the

agency did not plainly violate an unambiguous and man-

datory statutory provision. (App. A, at 5a). This is flawed

analysis. The act at issue in MCorp, the Financial Institutions

Supervisory Act (FISA), has an express preclusion of judicial

review. FISA states that, “no court shall have jurisdiction to

® Boire v, Greyhound Corp., 376 U.S. 473 (1964); Board of Governors

of the Fed. Reserve v. MCorp Financial Inc., 502 U.S. 32 (1991).

affect by injunction or otherwise the issuance or enforcement

of any notice or order under this section. or to review,

modify, suspend, terminate, or set aside any such notice or

order.” MCorp at 39. Contrasted with the FISA preclusion,

5 U.S.C. § 7123(a)(1) is anything but an express preclusion of

judicial review. Another reason MCorp held that Leedom

jurisdiction did not apply was because FISA allowed a

meaningful and adequate opportunity for judicial review

through future avenues the petitioners in MCorp had not yet

explored. MCorp at 43-44.

The Fifth Circuit’s application of MCorp to the FLMRA, a

Statute with no express preclusion of judicial review and no

meaningful and adequate opportunity for judicial review

through future avenues’, extinguishes Leedom jurisdiction in

its entirety. If the Fifth Circuit is allowed to cast MCorp as a

bar to judicial review in cases where a statute merely implies

preclusion and provides no meaningful and adequate oppor-

tunity for judicial review, then Leedom, with its emphasis on

the ability of the judiciary to protect of rights granted by

Congress, is completely foreclosed. Leedom at 188-191.

Granting certiorari will allow the Court to prevent MCorp

from becoming a total bar to the application of Leedom.

The Fifth Circuit’s application of Leedom eviscerates the

reason the. Leedom doctrine exists, to strike down an act of an

agency made in excess of the authority that agency was given

> Not only does the FLMRA not provide a meaningful and adequate

opportunity for judicial review, it has been held that a federal employee’s

attempt to access the courts prior to bringing a grievance and arbitration is

a failure to exhaust arbitration rights. Suzal v. Director, United States

Information Agency, 32 F.3d 574, 578 (D.C. Cir. 1994). Under the

FLRA’s scheme, per the Fifth Circuit holding, federal employees are

barred from the courts both before and after their rights have been

violated.

PE ANI Wak ARAL Bi i Laie latins Aso soar ASA 4: ey wad ale,

by Congress. Leedom at 188-189. While Leedom is narrow

and rarely applied, its essential holdings have not been altered

by this Court. Leedom holds:

This suit is not one to “review,” in the sense of that term

as used in the Act, a decision the Board made within its

jurisdiction. Rather, it is one to strike down an order of

the Board made in excess of its delegated powers and

contrary to a specific prohibition in the Act. Section

9(b)(1) is clear and mandatory. . . . Yet the Board

included in the unit professional employees, after

refusing to determine whether a majority of the

professional employees would “vote for inclusion in the

unit.” Plainiy, this was an attempted exercise of power

that had been Specifically withheld. [It deprived the

professional employees of a “right” assured to them by

Congress. Surely, in these circumstances, a Federal

District Court has jurisdiction of an Original suit to

prevent deprivation of a right so given.

Leedom at 188-189. The Fifth Circuit, in holding that the

Steelworkers Ti rilogy has no bearing on § 7122(a)(2), and in

holding that the FLRA’s actions in this case do not meet the

standards of Leedom, has limited this Court’s Leedom

doctrine to its particular facts. In this case, the F LRA clearly

violated § 7122(a)(2) when it Overturned the Arbitrator’s

interpretation of the parties’ MLA despite the fact that 5

U.S.C. § 7122 restricts the F LRA’s authority to review in line

with the Federal Courts per the Steelworkers T; rilogy. Here

too, the FLRA’s actions have deprived the Plaintiffs of their

rights as given to them by Congress under the FLMRA and

they have no Subsequent course of action to regain that right

other than seek protection in a federal court. The Fifth

Circuit’s erosion of the Leedom doctrine ignores obvious

application of Leedom to this case. A casting of this case in

the words of Leedom could be paraphrased as follows:

This suit is not one to “review,” in the sense of that term

as used in the Act, a decision the Authority made within

its jurisdiction. Rather, it is one to strike down an order

of the Authority made in excess of its delegated powers

and contrary to a specific prohibition of the Act. Sec-

tion 7122(a)(2) is clear and mandatory .... Yet the

Authority reviewed an arbitrator’s award on the

merits, substituting its interpretation of a collective

bargaining agreement for that of the arbitrator.

Plainly, this was an attempted exercise of power that had

been specifically withheld. It deprived the parties to

the collective bargaining agreement of a “right”

assured to them by Congress. Surely in these circum-

stances, a Federal District Court has jurisdiction of an

original suit to prevent deprivation of a right so given.’°

Furthermore, in applying Boire, to this case, the Fifth Circuit

continues to curtail Leedom jurisdiction in that the Fifth

Circuit stretches Boire, which did not involve a violation of

§ 7122(a)(2), into meaning that any error by an agency which

can be couched as a “factual error” does not fall under the

Leedom exemption. Boire’s application to the Leedom

doctrine must be specifically tied to the facts of Boire and not

made into a free pass for any agency that claims to merely

have made “factual errors.” The important difference

between Boire and the present case, which the Fifth Circuit

ignores, is that under the FLMRA, the FLRA was not given

the authority to reinterpret the arbitrator’s determination of

the meaning of the parties’ collective bargaining agreement,

'° This is a paraphrase of direct language from Leedom with the only

changes being marked in bold, substituting precisely the facts and issues

of the present case for those in Leedom. This language underscores the

importance to federal labor principles and the parallel between Peti-

tioner’s effort to obtain relief in the federal courts (starting at the district

level) where the FLRA has substituted its interpretation of the MLA for

that of an arbitrator with the relief a party in the private sector would seek

at the circuit court level if a federal district court overstepped its

Steelworkers Trilogy review authority in overturning an arbitration award.

See, e.g. United Paperworkers International Union v. Misco, Inc., 484

U.S. 29 (1987).

Ra At Mn 6D BOR) Nile Needed Bas ca Obedbe TILA ie

ab nerds

and therefore, any alleged “factual errors” made by the FLRA

were necessarily made after the FLRA had undertaken a

review of the arbitrator’s interpretation of the collective

bargaining agreement, and hence were made in excess of the

FLRA’s authority.

C. The Court Should Grant Certiorari Because the

Fifth Circuit’s Holding that the Steelworkers

Trilogy opinions do not provide guidance on its

jurisdiction over FLRA decisions is an important

question of federal law that has not been, but

should be, settled by this Court.

This Court has not addressed whether, and to what extent,

the Steelworkers T; rilogy applies to federal sector arbitrations.

In this case, the FLRA substituted its interpretation of the

parties’ collective bargaining agreement for that of the

arbitrator’s.'! This violates basic underpinnings of collective

bargaining principles as established in the Steelworkers

Trilogy, principles that should be applicable to federal sector

employees with collective bargaining agreements.

In both private sector and public sector labor law, it is

axiomatic that an arbitrator’s interpretation of a collective

bargaining agreement is near sacrosanct and cannot be

overturned when the decision draws its essence from the

collective bargaining agreement. United Steelworkers y.

Enterprise Wheel & Car Corp., 363 U.S. 593, 597 (1960).

The Steelworkers T; rilogy emphasizes the balance of bar-

gaining power in labor relations and the importance of

arbitration decisions by holding that if arbitration awards

were reviewed for errors, based upon the arbitrator’s

interpretation of the collective bargaining agreement, the

: Regardless of the jurisdiction question, this is a disputed issue of fact

on which the district court and the Fifth Circuit were obligated under Fed.

R. Civ. P. 12(b)(1) to take Petitioners’ alleged facts as true. Saraw Part-

nership v. United States, 67 F.3d 567, 569 (Sth Cir. 1995).

finality provisions of arbitration agreements would be

rendered meaningless and the bargained for arbitration would

become worthless. /d. at 599, citing to United Steelworkers v.

American Manufacturing Co., 363 U.S. 564 (1960); and see

United Steelworkers v. Warrior & Gulf Navigation Co., 363

U.S. 574 (1960). This Court held that parties to a collective

bargaining agreement have bargained for the arbitrator’s

interpretation of the agreement, not the court’s, or as in this

case, two of three federal agency members. /d.

In the private sector this Court provided a powerful

example of its commitment to protect arbitrators’ decisions in

United Paperworkers v. Misco, Inc., 484 U.S. 29, (1987)

(Misco). In Misco, a paper mill in Louisiana terminated an

employee after he was arrested for possession of marijuana at

his home for possession in his car on plant premises after the

police observed the employee and two other men in the

car smoking marijuana during the employee’s break. Id. at

32-34. The employee’s union grieved the termination. The

arbitrator, based on his interpretation of the parties’ collective

bargaining agreement, determined that the company did not

have just cause at the time of the employee's termination and

granted reinstatement with full back pay. Jd. The Company

filed suit in.district court to overturn the arbitrator’s decision

claiming on public policy grounds that an employer must be

able to fire an employee for smoking marijuana on plant

premises for safety reasons. Id. at 34-35. The district court

and the Fifth Circuit agreed. These federal courts reviewed

the facts of the arbitration and came to a different conclusion '

than the arbitrator. Jd. This Court, citing the Steelworkers :

Trilogy, reinstated the arbitrator’s decision with the following

language which emphasizes the finality and unreviewability

of arbitrator’s decisions when based on the collective bar-

gaining agreement:

The courts are not authorized to reconsider the merits

of an award even though the parties may allege that the

award rests on errors of fact or on misinterpretation of

the contract.

Id. at 36.

Whether the moving party is right or wrong is a question

of contract interpretation for the arbitrator. In these

circumstances the moving party should not be deprived

of the arbitrator’s judgment, when it was his judgment

and all that it connotes that was bargained for. . . .

The courts, therefore, have no business weighing the

merits of the grievance, considering whether there is

equity in a particular claim, or determining whether

there is particular language in the written instrument

which will support the claim. .. .

Id., citing Steelworkers v. American Mfg. Co., 363 U.S. 564,

567-68 (1960)(emphasis added).

To resolve disputes about the application of a collective-

bargaining agreement, an arbitrator must find facts and a

court may not reject those findings simply because it

disagrees with them. The same is true of the arbitrator’s

interpretation of the contract. The arbitrator may not

ignore the plain language of the contract; but the parties

having authorized the arbitrator to give meaning to

the language of the agreement, a court should not

reject an award on the ground that the arbitrator

misread the contract. Enterprise Wheel, supra, 363

U.S. at 599, 80 S.Ct. at, 1362. So, too, where it is

contemplated that the arbitrator will determine remedies

for contract violations that he finds, courts have no

authority to disagree with his honest judgment in

that respect. ...

[A]s long as the arbitrator is even arguably

construing or applying the contract and acting within

the scope of his authority, that a court is convinced

he committed serious error does not suffice to

overturn his decision. .. .

Misco at 38; citing Steelworkers v. Enterprise Wheel, 363

U.S. 593, 596, 597, and 599 (1960); and Steelworkers v.

American Mfg., Co., 363 U.S. 564, 567-568 (1960)(emphasis

added). Misco makes unmistakably clear that the 1960

opinions in the Steelworkers Trilogy are fully intact and are

unsinkable doctrines of labor law in this country even when

confronted by the troubling fact pattern of Misco. In the face

of the articulate and reasoned decision of Arbitrator Smith

and the powerful dissent of Member Pope of the FLRA, this

Court’s language in Misco about an “arbitrator even arguably

construing or applying the contract” leaves no wiggle room

for the FLRA majority if the Steelworkers Trilogy applies in

the federal sector.

While the Steelworkers Trilogy was based on private sector

labor law, the reverence for arbitrators’ interpretations of

collective bargaining agreements has carried over into all

aspects of public sector labor relations. Elkouri & Elkouri,

the leading authority on arbitration, states that the FLRA may

not rule on questions of contract interpretation made by the

arbitrator. Elkouri & Elkouri, How Arbitration Works, 1300,

(Ruben ed., 6th ed. 2003). This is the same level of deference

given to private sector arbitrator rulings under the

Steelworkers Trilogy. The Elkouri text (now wrong in the

Fifth Circuit as a practical matter, because if the FLRA

exceeds its authority the federal courts lack jurisdiction to

act) teaches that federal sector arbitral awards may not be

overturned merely because of disagreement with the arbi-

trator’s findings of fact, reasoning, and conclusion, or con-

clusions drawn from the evidence. El/kouri at 1301.

Despite the carte blanche the FLRA now enjoys in the Fifth

Circuit, the FLRA itself, not long ago, tracked the language

of the Steelworkers Trilogy by holding that, “the inter-

pretation of the collective bargaining agreement is a matter

solely for the arbitrator because it is the arbitrator’s con-

struction of the agreement for which the parties have

bargained.” United States Dept. of Health and Human

Services v. AFGE Council 147, 38 FLRA 1183, 1188 (1990).

The FLRA has explicitly referenced the Steelworkers

standard relied upon in Misco, when the FLRA held, “as long

as an arbitrator is even arguably construing the collective

bargaining agreement, that a court is convinced that the

arbitrator committed serious error does not suffice to find the

award deficient.” United States Dept. of Labor (OSHA)

and National Council of Field Labor Locals, 34 FLRA 573,

576 (1990).

It would be difficult to conjure a ruling by a United States

Circuit Court that could have a more profound and damaging,

national impact than this decision by the Fifth Circuit Court

of Appeals. Not only does federal labor policy favor the

sanctity of arbitration awards, but federal labor policy favors

arbitration. This decision, which treats arbitration awards in

the federal sector as inferior to those in the private sector

(because they may be freely overturned), is at odds not only

with the Steelworkers Trilogy, but also with the holdings of

the District of Columbia Court of Appeals and earlier more

reasoned decisions of the FLRA itself. This decision

undercuts federal policy favoring arbitration, a policy fur-

thered by this Court’s rulings in Circuit City Stores v. Adams,

532 U.S. 105 (2001) and Gilmer v. Interstate/Johnson Lane

Corp., 500 U.S. 20 (1991). Arbitration is not a viable or fair

substitute for litigation (or for concerted activity by unions)

where arbitration awards are not protected by the doctrine this

Court announced in 1960 in the Steelworkers T; rilogy.

CONCLUSION

For all the reasons stated herein, the petition for a writ of

certiorari should be granted.

e Respectfully submitted,

HAL K. GILLESPIE *

GILLESPIE, ROZEN, WATSKY,

& MOTLEY, P.C.

3402 Oak Grove Avenue, Suite 200

Dallas, Texas 75204

* Counsel of Record (214) 720-2009

APPENDICES

APPENDIX A

UNITED STATES COURT OF APPEALS

FIFTH CIRCUIT

No. 03-51264

Summary Calendar

AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES,

LOCAL 1617; Arthur Celestino; American Federation of

Government Employees, Council Number 214,

Plaintiffs-Appellants,

FEDERAL LABOR RELATIONS AUTHORITY,

Defendant-Appellee.

Decided June 29, 2004.

Before HIGGINBOTHAM, DAVIS and PRADO, Circuit

Judges.

PER CURIAM:”

Appellants, the American Federation of Government

Employees Local 1617 (“Local 1617”), Arthur Celestino, and

American Federation of Government Employees Council

Number 214 (“Council Number 214”), sued the Federal

Labor Relations Authority (“FLRA”) in district court, alleg-

ing that the FLRA exceedéd its authority in overruling an

arbitration decision. Appellants’ suit was dismissed for lack

"Pursuant to Sth Cir. R. 47.5, the court has determined that this

opinion should not be published and is not precedent except under the

limited circumstances set forth in Sth Cir. R. 47.5.4.

of subject matter jurisdiction. For the following reasons,

this court AFFIRMS the district court’s judgment dismissing

Appellants’ lawsuit.

Background

Local 1617 and Council Number 214 represent employees

of the United States Department of the Air Force, San

Antonio Air Logistics Center, Kelly Air Force Base, San

Antonio (“Agency”). Appellant Celestino was an employee

of the Agency. At all relevant times, relations between

Appellants and the Agency were covered by the Master Labor

Agreement (“MLA”). In April 1999, employees of the

Agency, who were represented by Local 1617, brought a

grievance against the Agency alleging that they were entitled

to Environmental Differential Pay (“EDP”) because of ex-

posure to asbestos. The Agency denied the grievance.

Local 1617 invoked arbitration, as authorized by the MLA.

After a lengthy arbitration, the arbitrator ruled that the

employees were entitled to limited EDP.

Appellants and the Agency filed exceptions to the

arbitration award with the FLRA, under 5 U.S.C. § 7122.

The FLRA is an independent agency whose responsibilities

include resolving exceptions to arbitration awards. The

FLRA set aside the arbitration award, finding that the award

was deficient. Appellants moved for reconsideration. The

FLRA denied that motion.

Appellants sued FLRA, alleging that FLRA had violated

the Federal Labor Management Relations Act’ when it

overturned the arbitrator’s decision. FLRA moved under

Fed.R.Civ.P. 12(b)(1) to dismiss for lack of subject matter

jurisdiction. Appellants moved for summary judgment. The

district court granted FLRA’s Rule 12(b)(1) motion, denied

'5 U.S.C. § 7101 et seq.

Appellants’ motion for summary judgment, and entered a

judgment dismissing Appellants’ lawsuit. Appellants timely

appealed.

Discussion

Standard of review

This court reviews de novo the grant of a Rule 12(b4(1)

motion.” The burden of proof for a Rule 12(b)(1) motion to

dismiss is on the party asserting jurisdiction;? in this case, the

Appellants. A Rule 12(b)(1) motion may be granted only

when it appears certain that the plaintiffs cannot prove any set

of facts in support of their claim that would entitle them to

relief.* For purposes of analyzing a Rule 12(b)(1) motion this

court takes the plaintiff's alleged facts as true.>

Jurisdiction to review FLRA decisions

The FLRA may change an arbitrator’s award if it finds the

award is deficient: “(1) because it is contrary to any law, rule

or regulation; or (2) on other grounds similar to those applied

by Federal courts in private sector labor-management

relations.” There is no statutory provision providing for

review of the FLRA’s decisions on arbitration awards,’

Appellants argue that despite the lack of a provision for

federal court review of the FLRA’s decisions, the district

* Hebert v. United States, 53 F.3d 720, 722 (Sth Cir.1995).

* McNutt v. Gen. Motors Acceptance Corp., 298 U.S. 178, 56 S.Ct.

780, 80 L.Ed. 1135 (1936).

* Benton v. United States, 960 F.2d 19, 21 (Sth Cir. 1 992).

° Saraw Partnership v. United States, 67 F.3d 567, 569 (Sth Cir. 1995).

° 5 U.S.C. § 7122(a).

"Asa general matter, parties may seek review of FLRA decisions in

federal courts of appeals. 5 U.S.C. § 7123(a). However, they may not

seek review of final FLRA decisions about arbitrator’s awards unless the

order involves an unfair labor practice. /d

court had jurisdiction to hear this case under the Supreme

Court’s decision in Leedom v. Kyne.*

In Leedom, a group of professional employees objected to a

decision of the National Labor Relations Board (“NLRB”)

that combined professional and non-professional employees

into one bargaining unit.” The employees sued the NLRB in

district court, alleging that the NLRB had violated a National

Labor Relations Act provision explicitly prohibiting such

combinations without prior approval of the professional

employees.” The district court found that jurisdiction

existed, and the circuit court affirmed that decision.'' The

Supreme Court also affirmed jurisdiction, finding that the

NLRB had acted “in excess of its delegated powers and

contrary to a specific prohibition in the [National Labor

Relations Act].”!? The Court reasoned that if it found

jurisdiction did not exist, then the rights of the professional

employees would be sacrificed, and that “where, as here,

Congress has given a ‘right’ to the professional employees it

must be held that it intended that right to be enforced. . .

This exception, however, is very narrow. In Boire v.

Greyhound Corporation, the plaintiffs attempted to challenge

a NLRB finding that independent contractors were employees

of the hiring corporation, despite a National Labor Relations

Act statute excluding independent contractors from the

definition of employee.'* In Boire, the Supreme Court held

8 358 U.S. 184, 79 S.Ct. 180, 3 L.Ed.2d 210 (1958).

” Id.

10 Id

11 Id

12 Td. at 184, 79 S.Ct. 180.

'3 Td at 185, 79 S.Ct. 180.

\4 376 U.S. 473, 84 S.Ct. 894, 11 L.Ed.2d 849 (1964).

that deciding whether someone met the definition of

employee was a factual question and that there was no federal

jurisdiction to review such a decision.'> The Court explained

that the Leedom exception is a narrow one, not to be extended

to permit plenary district court review of [NLRB] orders .. .

whenever it can be said that an erroneous assessment of the

particular facts before the [NLRB] has led it to a conclusion

which does not comport with the law.'®

In Board of Governors of the Federal Reserve System vy.

MCorp Financial, Inc., the Supreme Court held that juris-

diction existed to review an agency action alleged to have

exceeded the agency’s statutory authority.'’ The Supreme

Court found that there was no jurisdiction where the agency’s

authorizing statute indicated a congressional intent to deny

district court review, and the statute provided a meaningful

and adequate opportunity for judicial review. '®

This court has analyzed the Leedom exception and ex-

plained that it is “narrow and rarely used.”'? Further, the

exception should be used to correct only egregious error, and

does not allow federal courts to review whether an agency

responsible for implementing a statute has misinterpreted that

statute.”” Instead, the Leedom exception allows jurisdiction

“only in a very narrow situation in which there is a plain

violation of an unambiguous and mandatory provision of the

statute.””! Appellants argue that the FLRA decision fits into

this narrow category of violations. Under the Leedom ex-

15 Id

' Id. at 481-481, 84 S.Ct. 894.

"$02 U.S. 32, 112 S.Ct. 459, 116 L.Ed.2d 358 (1991).

8 Td.

Russell v. Nat'l Mediation Bd., 714 F.2d 1332, 1340 (Sth Cir. 1983).

*° Am. Airlines, Inc. v. Herman, 176 F.3d 283, 292 (Sth Cir. 1999).

*! Herman, 176 F.3d at 293.

ception, jurisdiction will exist only if FLRA plainly violated

unambiguous and mandatory statutory provisions.” As

explained below, Appellants have not shown that the FLRA’s

decision violated any statutory provision.

Propriety of the FLRA decision under 5 U.S.C. § 7122(a)(2)

Appellants contend that the FLRA violated 5 U.S.C.

§ 7122(a)(2) by overturning an arbitrator’s award. Spe-

cifically, Appellants argue that FLRA should have given

special deference to the arbitration award because it was

based on the arbitrator’s interpretation of a collective

bargaining agreement.

Section 7122 provides that:

(a) Either party to arbitration under this chapter may file

with the [FLRA] an exception to any arbitrator’s award

pursuant to the arbitration. . . . If upon review the

[FLRA] finds that the award is deficient—

(1) because it is contrary to any law, rule, or reg-

ulation; or

(2) on other grounds similar to those applied by Fed-

eral courts in private sector labor-management

relations;

the [FLRA] may take such action and make such

recommendations concerning the award as it considers

necessary, consistent with applicable laws, rules, or

regulations.

The FLRA found that the award was deficient because it

was contrary to law.. The FLRA maintains that while it

overturned the arbitrator’s legal conclusions, it deferred to the

arbitrator’s findings of fact. Pursuant to § 7122(a)(1), the

FLRA is authorized to change an arbitrator’s award if the

22 See id.

FLRA finds the award is contrary to any law, rule, or

regulation.”’ In fact, the District of Columbia Circuit has held

that if an arbitrator’s award is challenged because it is

contrary to a law, rule or regulation, the FLRA must conduct

a de novo review.”4

The FLRA decision references the arbitrator’s findings that

the parties to arbitration had not agreed to a specific standard

for entitlement to EDP. Based on this finding, the arbitrator

concluded that there was a conflict between the Agency’s

regulations and the MLA between the parties. The arbitrator

next held, as required when a regulation conflicts with a labor

agreement,” that the regulation could not be applied. The

FLRA decision does not challenge the arbitrator’s finding that

the MLA did not specify an EDP threshold. Rather, FLRA

contends that the arbitrator was wrong to dismiss the

Agency’s regulations when the MLA did not present any

regulations of its own that could have conflicted with the

Agency’s regulations.

in response, Appellants argue that the lack of an agreement

on specific regulations means that the threshold for EDP was

to be set on a case-by-case basis. To support this point, they

quote the arbitrator’s finding that the Union representing the

Agency employees specifically bargained to avoid including

an EDP threshold in the MLA, so that EDP could be awarded

on a case-by-case basis. Contrary to Appellants’ assertions,

however, this finding relates to the Union’s bargaining

position, not the binding final product of that bargaining—the

MLA. Appellants do not cite any requirement in the MLA

that EDP is to be determined on a case-by-case basis, nor do

7 is Dep't of Treasury v. Fed. Labor Relations Auth., 43 F.3d 682,

686-87 (D.C.Cir. 1994).

4 Td. at 686-87.

> See US. Dep't of the Army, Ft. Campbell Dist., Third Region, Ft.

Campbell, Ky., 37 FLRA 186, 195, 1990 WL 140089 (1990).

they assert that the arbitrator found such a requirement. The

arbitrator’s findings about the Union’s bargaining goals are

irrelevant to determining whether the MLA conflicts with

Agency regulations.

Therefore, FLRA did not contradict a factual finding by the

arbitrator when it determined that the MLA was silent on the

appropriate method of determining EDP. Rather, FLRA

applied its own review of the applicable law. The FLRA’s

binding precedent dictates that in the absence of an agreed-

upon regulation the Agency’s owi regulation governs.”°

Thus, FLRA acted within its authority in determining that

Agency regulations govern the assessment of EDP in this

case, where there was no other agreement governing that

assessment. This court does not have jurisdiction over FLRA

decisions that are made pursuant to FLRA’s authority.

The FLRA decision and congressional intent

Appellants next contend that congressional intent will be

thwarted unless courts have subject matter jurisdiction to

review FRLA decisions about arbitration awards. Appellants

maintain that without district court review there will be no

mechanism to ensure that FLRA does not reach beyond

what Congress intended to be its very limited right to alter

arbitration awards. Appellants do not cite any legislative

history to support this position. Rather, they argue that as a

general matter, expedition of dispute resolution and the

finality of arbitration decisions would be undermined without

district court review of FLRA decisions.

° U.S. Dep’t of the Army, Fort Campbell Dist., Third Region, Fort

Campbell, Ky., 37 FLRA 186, 195, 1990 WL 140089 (1990) (agency

rules and regulations “govern the disposition of matters to which they

apply . .. when the rules and regulations do not conflict with provisions of

an applicable collective bargaining agreement”).

Appellants cite a series of three Supreme Court opinions,

the Steelworkers Trilogy,”’ to support the proposition that

employment arbitrations are to be given a high degree of

deference. The Steelworkers T; rilogy opinions, however, deal

with federal court review of employment arbitration

decisions, not federal court review of FLRA decisions. The

Steelworkers Trilogy opinions do not provide guidance on

this court’s jurisdiction over FLRA decisions. Instead, this

court must rely on the statutory language that specifically

explains when review is appropriate.

Appellants’ argument about congressional intent is uncon-

vincing in light of the Statutory scheme surrounding the

FLRA. Congress explicitly provided for review of FLRA

decisions under 5 U.S.C. § 7123. This provision also

prohibits review when the FLRA decision involves an order

by an arbitrator, unless the order involves an unfair labor

practice. Section 7123 evidences Congress’s intent that only

certain FLRA decisions should be reviewed. There is no

reason to assume a different congressional intent from that

stated on the face of the statute. Therefore, this court finds it

does not have jurisdiction to hear this case based on

congressional intent.

Propriety of the FLRA decision under 5 U.S.C. § 7101

Lastly, Appellants argue that the FLRA decision under0

mined all collective bargaining and therefore violated 5

U.S.C. § 7101, This argument essentially reiterates Appel-

lants’ argument asserting that the FLRA violated 5 U.S.C.

§ 7122. Appellants contend that the FLRA undermined

collective bargaining by replacing an agreed-upon rule with a

*” United Steelworkers v. Am. Mfg. Co., 363 U.S. 564, 80 S.Ct. 1343,

4 L.Ed.2d 1403 (1960); United Steelworkers v. Enter. Wheel & Car

Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960); United

Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 80 S.Ct.

1347, 4 L.Ed.2d 1409 (1960).

10a

rule created by an agency. As discussed above, there is no

evidence that the MLA included a rule specifying when to

award EDP pay, nor did the arbitrator conclude that there was

such a rule. Therefore, Appellants’ argument that an agreed-

upon rule was ignored fails. There is no jurisdiction for this

court to hear this appeal based upon a violation of 5 U.S.C.

§ 7101.

Conclusion

Appellants fail to demonstrate that FLRA plainly violated a

mandatory and unambiguous statutory provision. Accord-

ingly, the district court correctly found that it lacked subject

matter jurisdiction over the dispute and dismissed the case

under Rule 12(b)(1). Therefore, this court AFFIRMS the

district court’s judgment dismissing Appellants’ lawsuit.

AFFIRMED.

lla

APPENDIX B

UNITED STATES DISTRICT COURT,

W.D. TEXAS, SAN ANTONIO DIVISION

No. Civ.A.SA-03-CA-58-FB

AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES,

LOCAL 1617, Arthur Celestino, and American Federation of

Government Employees, Council Number 214,

Plaintiffs,

FEDERAL LABOR RELATIONS AUTHORITY,

Defendant.

Oct. 21, 2003

Michael Putman, Putman & Putman, San Antonio, TX, Hal

Keith Gillespie, Gillespie, Rozen, & Watsky, P.C., Dallas,

TX, for Plaintiffs.

Raymond A. Nowak, U.S. Attorney’s Office, San Antonio,

TX, William R. Tobey, David M. Smith, Office of the

Solicitor, James F. Blandford, Federal Labor Relations

Authority, Washington, DC, for Defendant.

ORDER ACCEPTING REPORT AND

RECOMMENDATION OF THE UNITED STATES

MAGISTRATE JUDGE

BIERY, J.

Before the Court is the Report and Recommendation of the

United States Magistrate Judge (docket no. 25) and plaintiffs’

written objections thereto (docket no. 29).

12a ~

Where no party has objected to a Magistrate Judge’s Report

and Recommendation, the Court need not conduct a de novo

review of the Report and Recommendation. See 28 U.S.C.

§ 636(b)(1) (“A judge of the court shall make a de novo

determination of those portions of the report or specified

proposed findings and recommendations to which objection is

made.”). In such cases, the Court need only review the Report

and Recommendation and determine whether it is clearly

erroneous or contrary to law. United States v. Wilson, 864

F.2d 1219, 1221 (Sth Cir.), cert. denied, 492 U.S. 918, 109

S.Ct. 3243, 106 L.Ed.2d 590 (1989).

On the other hand, any Report and Recommendation to

which objection is made requires de novo review by the

Court. Such a review means that the Court will examine the

entire record, and will make an independent assessment of the

law. The Court need not, however, conduct a de novo review

when the objections are frivolous, conclusive, or general in

nature. Battle v. United States Parole Comm’n, 834 F.2d 419,

421 (Sth Cir.1987).

The Court has thoroughly analyzed the plaintiffs’ submis-

sion in light of the entire record. As required by Title 28

U.S.C. § 636(b)(1)(c), the Court has conducted an inde-

pendent review of the entire record in this cause and has

conducted a de novo review with respect to those matters

raised by the objections. After due consideration, the Court

concludes plaintiffs’ objections lack merit.

This case involves the interpretation of statutes governing

an administrative process which is similar to the substantial

evidence rule applied in social security cases. At the thresh-

old, plaintiffs argue the report erroneously recommends

applying the wrong standard of review. Consistent with

plaintiffs’ arguments, the report does recommend that the

Court accept as true all well-pleaded factual allegations and

draw all reasonable inferences in favor of plaintiff. The first

amended complaint itself is approximately two inches in

13a

thickness, containing six attachments, A through F, which

include: the Master Labor Agreement between the AFGE and

the Air Force Material Command; the October 9, 2001

decision of the arbitrator; the April 7, 2002 supplemental

order and attached time billing statement; the September 11,

2002 orders of the Authority; September 11, 2002 statement

of service by the Authority and November 13, 2002 order

denying the request for reconsideration by the Authority; and

November 13, 2002 statement of service by the Authority.

Pursuant to settled law, these attachments were and are

considered to be part of the first amended complaint when

accepting as true the factual allegations of the complaint and

construing them in the light most favorable to plaintiffs. See

Fed. R. Civ. P. 10(c); Lovelace v. Software Spectrum, Inc., 78

F.3d 1015, 1017-18 (5th Cir. 1996).' The Magistrate Judge

reviewed all the submissions of all parties in preparing a

report on subject matter jurisdiction, as did this Court, in

informing itself as to the issues plaintiffs were presenting to

the Court for resolution on the merits.

' Few other evidentiary materials were submitted by the parties on their

cross-motions. Defendant’s motion to dismiss or for summary judgment

appends only the three decisions of the Authority at issue, as they appear

in the Authority’s reporter, 58 FLRA Nos. 13, 14 and 47 (Sept. 11, 2002

and Nov. 13, 2002) (docket no. 3, attachments). Defendant also submitted

a statement of material facts not in dispute (docket no. 4). Plaintiffs’

response to defendant’s motion and piaintiffs’ cross-motion for summary

judgment append virtually identical affidavits from Mr. Joseph A.

Gillespie, an attorney for plaintiffs, in which plaintiffs incorporate by

reference all exhibits to the first amended complaint (docket no. 9, attach-

ment; docket no. 21, attachment). Defendant’s response to plaintiffs’

cross-motion forwards OPM Compensation and Leave Decision, Case No.

S001371 (May 12, 1998), in support of defendant’s argument that, con-

trary to plaintiffs’ argument that the Authority’s decision and its reliance

on the Agency’s regulation usurps the authority of OPM, provides that

specific judgments as to EDP entitlements are left to the discretion of the

individual agencies (docket no. 16).

l4a

Plaintiffs assert that the report “fails to analyze the

Arbitrator’s Award and Opinion” (objections at 9) or other

key pieces of evidence submitted by plaintiffs through the

first amended complaint. Substantive issues presented by the

parties were considered to the extent they related to an

assessment of subject matter jurisdiction. It is not necessary

for the report to discuss all of those facts when it identifies

the aspects of the parties’ disputes material to a resolution of

subject matter jurisdiction. The arbitrator’s first decision, for

example, numbers more than 200 pages. Indeed, plaintiffs’

objections to the report, which numbers 43 pages, arguably

contains little analysis of the arbitrator’s decisions, yet is

sufficient to state the bases of plaintiffs’ strongly differing

views on the determination of no jurisdiction.

Analogously, plaintiffs assert that “the Court must deter-

mine the merits of plaintiffs’ claims in order to decide

whether or not Leedom v. Kyne jurisdiction exists” (objec-

tions at 16). Citing Williamson v. Tucker, 645 F.2d 404, 415

(Sth Cir. 1981), plaintiffs argue that when a “defendant’s

challenge to the court’s jurisdiction is also a challenge to the

existence of a federal cause of action, the proper course of

action is for the district court is to find that jurisdiction exists

and deal with the objection as a direct attack on the merits of

plaintiffs’ case” (objections at 17)? But, in this case, under

? In Williamson, the issue was whether joint venture interests and notes

were “securities” within the meaning of the Securities Act of 1933 and the

Securities and Exchange Act of 1934. The district court dismissed the case

for lack of subject matter jurisdiction, with minimal explanation that the

documents at issue were not “securities,” the matter in dispute, 645 F.2d at

407, 410. The Fifth Circuit reversed the dismissal for lack of subject

matter jurisdiction noting: “In this case it is clear that the jurisdictional

issue reaches the merits of plaintiff's case; if the joint venture interests and

notes are not securities, there is not only no federal jurisdiction to hear the

case but also no federal cause of action on the stated facts.” /d. at 416. The

Fifth Circuit concluded that plaintiffs’ claims “are not so clearly immate-

rial or insubstantial as to justify their dismissal... .” Jd. at 429.

15a

the general rule of 5 U.S.C. § 7123, there is no subject matter

jurisdiction in this Court over plaintiffs’ claims unless the

“narrow and rarely used”? exception set out in Leedom vy.

Kyne, 358 U.S. 184, 79 S.Ct. 180, 3 L.Ed.2d 210 (1958),

applies. Williamson does not deal with the situation governed

by Kyne and does not address the determination of whether an

exception to a general lack of subject matter jurisdiction

exists. Further, although defendant did move to dismiss under

both Rules 12(b)(1) and (6), the basis of its motion to dismiss

for failure to state a claim was lack of subject matter

jurisdiction; the report recommends dismissal based on a lack

of subject matter jurisdiction. Neither defendant’s motion to

dismiss nor the report ultimately speak to the issue of whether

plaintiffs have or could state a federal cause of action, only

that the Court lacks subject matter jurisdiction over the claims

asserted.’ But, the report does conclude plaintiffs have not

demonstrated the Authority acted in excess of its statutory

powers, violated a clear mandate of its own enabling statute,

and made an “egregious error,” a finding necessary for subject

matter jurisdiction. To make a finding of no egregious error,

the Court necessarily was required to analyze fully plaintiffs’

claims and arguments. Nevertheless, even if under Williamson

this Court is required to consider the merits of plaintiffs’

> Russell v. National Mediation Bd., 714 F.2d 1332, 1340 (Sth Cir.

1983) (quotation omitted), cert. denied sub, nom. Brotherhood of Ty,

Airlines and S.S. Clerks, Freight Handlers, Express & Station Handlers vy.

Russell, 467 U.S. 1204, 104 S.Ct. 2385, 81 L.Ed.2d 344 (1984).

* For example, a claim of an unfair labor practice likely would state a

claim for relief. Similarly, a claim arising under the United States Consti-

tution might state a claim for relief. See National Treasury Employees

Union v. FLRA, 112 F.3d 402, 404 (9th Cir. 1997) (“The House Confer-

ence Report [to § 7123] notes that unless a decision relates to an unfair

labor practice, ‘decisions of the Authority are final and conclusive and not

subject to further judicial review except for questions arising under

the Constitution.”’) (citation omitted). Plaintiffs’ first amended complaint

does not allege an unfair labor practice or a claim arising under the

Constitution.

Ce a a a ee

l6a

claims when deciding subject matter jurisdiction to unspeci-

fied degree greater than that already undertaken, plaintiffs do

not show how such further consideration of the merits of their

claims demonstrates the existence of subject matter jurisdic-

tion. If, as plaintiffs request, the Court simply finds jurisdic-

tion to exist and deals with defendant’s objections as an

attack on the merits of plaintiffs’ case, the Kyne exception

would swallow the general rule of no jurisdiction. Virtually

any plaintiff who seeks to appeal a final FLRA decision

presumably would have asserted a claim on the merits as to

why the Authority’s decision should be set aside or modified

and any such claim could be said to be intertwined with the

assessment of whether an egregious error, sufficient to invoke

the Kyne exception, existed. This Court has fully informed

itself as to plaintiffs’ claims and the parties’ contentions to

determine if the Kyne exception has been satisfied. To that

extent, the Court has considered the merits of plaintiffs’

claims and in the process has viewed all factual allegations in

the first amended complaint and its attachments viewed as

true.” However, once the Court decides it lacks subject matter

jurisdiction, no further determination of the merits of the

dispute is undertaken nor, absent jurisdiction, is aporopriate.

At the center of plaintiffs’ objections are their arguments

that the report misapplies the Kyne exception. It is clear that

section 7123 generally precludes District Courts from review-

* If, as plaintiffs urge, the merits of plaintiffs’ claims are so intertwined

with the determination of jurisdiction that they must be considered in

tandem, then the Court is no longer required to accord “‘presumptive

truthfulness”’ to the allegations in plaintiffs’ complaint “‘and the existence

of disputed material facts will not preclude the trial court from evaluating

for itself the merits of jurisdictional claims.”’ Williamson, 645 F.2d at 413

(citation omitted). As the plaintiffs’ summary judgment proof is confined

to the attachments to the first amended complaint, see note | above, no

additional evidence would be required to be considered by the Court to

grant defendant’s companion motions to dismiss for failure to state a claim

or for summary judgment.

17a

ing the Authority’s decisions on exceptions to an arbitrator’s

award (unless, for example, an unfair labor practice exists).°

In Leedom vy. Kyne, the United States Supreme Court recog-

nized an exception to section 7123’s general rule of no

jurisdiction if the Authority acted “in excess of its delegated

powers and contrary to a specific prohibition in the Act.” 358

U.S. at 188-89; see also Board of Governors of the Federal

Reserve System v. MCorp Financial, Inc., 501 U.S. 32, 34,

111 S.Ct. 2123, 115 L.Ed.2d 27 (1991). The Fifth Circuit has

stated that, under Kyne, district courts are accorded jurisdic-

tion “only if the agency’s interpretation ‘is infused with error

which is of a summa or magna quality as contraposed to

decisions which are simply cum error. Only egregious error

melds the [agency’s] decision into justiciability.”” American

Airlines, Inc. v. Herman, 176 F.3d 283, 292 (Sth Cir. 1999)

(citation omitted).

Here, the Authority accepted the arbitrator’s findings that

[c]learly, there is no specific standard for entitlement to

EDP [abbreviation for “environmental differential pay”’] set

forth in the contract’ and that the parties had not ‘agree[d]

to a specific standard for entitlement to EDP” (docket no. » 3

exhibit D at 3). The Authority then applied an Agency

regulation, that is, a federal regulation within the meaning of

section 7122(a), to set the standard for EDP.’ Plaintiffs have

not demonstrated that the Authority’s decision to apply a

regulatory standard for EDP, when the collective bargaining

agreement did not expressly provide any specific standard for

666

° By relying on the Kyne exception in their objections to the report,

plaintiffs appear to concede that the Court lacks subject matter jurisdiction

unless the Kyne exception applies.

” This case seeks review of the FLRA’s decision on exceptions to an

arbitrator’s award, not a direct challenge to the authority of the Agency to

promulgate the regulation in question. Nor does this case address any issue

relating to the lack of any amendments to the CBA to provide a specific

standard for EDP.

18a

EDP (even an express “case by case” standard), was in excess

of statutory powers, in violation of a clear mandate of its own

enabling statute, or an egregious error. Therefore, the Kyne

exception is not applicable and this Court lacks subject matter

jurisdiction to resolve the merits of plaintiffs’ disputes and

award the relief sought by plaintiffs.

In sum, 5 U.S.C. § 7123(a) precludes this Court from

reviewing the Authority’s decision to vacate the arbitration

awards at issue in this case. Although the United States

Supreme Court in Kyne recognized a possible exception to

section 7123’s preclusion of jurisdiction, plaintiffs have not

shown that the Authority acted in excess of its statutory

powers, violated a clear mandate of its own enabling statute,

or committed an egregious error sufficient to invoke the Kyne

exception. Therefore, this Court lacks subject matter jurisdic-

tion to resolve the merits of plaintiffs’ claims and to award

plaintiffs the relief sought. Defendant’s motion to dismiss for

lack of federal subject matter jurisdiction filed pursuant to

rule 12(b)(1) of the Federal Rules of Civil Procedure shall be

granted. -

IT IS THEREFORE ORDERED that the Report and

Recommendation of the United States Magistrate Judge

(docket no. 25) is ACCEPTED pursuant to 28 U.S.C. § 636

(b)(1) such that:

(a) Defendant’s motion to dismiss (contained within docket

no. 3) for lack of subject matter jurisdiction pursuant to rule

12(b)(1) of the Federal Rules of Civil Procedure is

GRANTED and plaintiffs’ cause of action is DISMISSED;

(b) Defendant’s motion to dismiss (contained within docket

no. 3) for failure to state a claim pursuant to rule 12(b)(6) of

the Federal Rules of Civil Procedure and alternative motion

for summary judgment (contained within docket no. 3) are

DENIED as MOOT; and

19a

no. 21) is DENIED.

IT IS FURTHER ORDERED that the above-styled and

numbered cause is DISMISSED for lack of subject matter

jurisdiction. Motions pending with the Court, if any, are

dismissed as moot.

It is so ORDERED.

20a

APPENDIX C

F.L.R.A.

AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES,

LOCAL 1617 (Union) and UNITED STATES DEPARTMENT OF

THE AIR FORCE SAN ANTONIO AIR LOGISTICS CENTER KELLY

AIR FORCE BASE SAN ANTONIO, TEXAS (Agency)

0-AR-3469

September 11, 2002

Before the Authority: Dale Cabaniss, Chairman, and Carol

Waller Pope and Tony Armendariz, Members!

DECISION

I. Statement of the Case

This matter is before the Authority on exceptions to an

award of Arbitrator Larry D. Smith filed by both the Agency

and 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, and the Union filed an opposition to

the Agency’s exceptions. In addition, the Agency has re-

quested that the Authority permit the parties to present oral

argument in support of their positions.

The Union filed a grievance over the Agency’s failure to

pay unit employees environmental differential pay (EDP).

The Arbitrator sustained the grievance and awarded em-

ployees backpay. We find that the award is deficient, and we

set the award aside.

‘Member Pope’s dissenting opinion is set forth at the end of this

decision.

2la

II. Background and Arbitrator’s Award

The Union filed a grievance over “‘the Agency’s failure

and/or refusal to pay environmental pay (EDP) to the Union’s

Bargaining Unit employees represented by the Union as a

result of asbestos exposure at the Facility [Kelly Air Force

Base] since March 9, 1975.”* Award at 97 (quoting the

grievance).” The Arbitrator sustained the grievance and

awarded unit employees backpay.

In sustaining the grievance, the Arbitrator considered the

threshold issue of the standard for entitlement to EDP for

exposure to asbestos. In particular, the Arbitrator examined

whether the parties had agreed to apply the permissible

exposure level (PEL) of the Occupational Safety and Health

Administration (OSHA) as the standard for entitlement to

EDP for exposure to asbestos. He explained the “huge

significance” of this issue, as follows:

If the Agency’s position that the parties agreed to use the

OSHA PEL as the applicable EDP standard is embraced,

the Union’s grievance is doomed. While there are

occasions of OSHA violations in the history of asbestos

use at Kelly [Air Force Base], such episodes are rare and

isolated. In fact counsel for the Union . . . admitted that

if the case was decided in favor of the Agency insofar as

the OSHA PEL being the standard for EDP was con-

cerned, then the Union’s fate was sealed to the down-

side.

Id. at 122.

The Arbitrator first considered whether the parties’ collec-

tive bargaining agreement provided a standard for the award

of EDP for exposure to asbestos. He noted that the agree-

? Kelly Air Force Base was closed on July 13, 2001. See Regional

Director’s Decision and Order in United States Dep’t of the Air Force, Air

Force Materiel Command, Kelly Air Force Base, Tex., Case No. DA-RP-

01-0005, application for review denied, 57 FLRA 749 (2002).

22a

ment’s only specific reference to EDP is contained in Article

26, which provides: “In accordance with Federal Law,

Government-wide regulation and this Agreement, an environ-

mental differential will be paid to eligible wage-grade

employees who are exposed to hazard or physical hardships.”

Id. at 112 (quoting the agreement). From this reference, the

Arbitrator concluded that “[c]learly, there is no specific

standard for entitlement to EDP set forth in the contract,” id.,

and that the parties had not “agree[d] to a specific standard

for entitlement to EDP,” id. at 221.

In addition, the Arbitrator considered the claim of the

Agency that the bargaining history of the agreement

evidences that the parties agreed to the OSHA PEL as the

standard for entitlement to EDP for exposure to asbestos.

After examining the bargaining history, he found the history

insufficient to establish that the parties had agreed to the

OSHA PEL as the standard for EDP for exposure to asbestos.

The Arbitrator also considered the claim of the Agency that

the conduct of the parties subsequent to the execution of the

initial collective bargaining agreement confirms the existence

of an agreement to allow the OSHA PEL to govern entitle-

ment to EDP for exposure to asbestos.

In considering this claim, the Arbitrator examined the regu-

lation promulgated by the Air Force Logistics Command

(AFLC) (now the Air Force Materiel Command (AFMC))

(the headquarters command of the Agency) on November 3,

1987, entitled “AFLC Supplement to AF Supplement to FPM

Supplement 532-1.” The regulation stated, in pertinent part,

as follows:

S8-7a(1). AFLC definition of “practically eliminated.”

Reduction of exposure to unusually severe hazards,

physical hardships or unusually severe working con-

ditions to a level consistent with accepted standards (e.g.

AFOSH standards, AF manuals and regulations, OSHA

or other recognized national consensus standards).

23a

As noted by the Arbitrator, the regulation was repromulgated

on February 11, 1997, primarily to change the command

acronym. AFMC Supplement to AF Supplement to FPM

Supplement 532-1 provides, in pertinent part, as follows:

S8-7a(1). AFMC definition of “practically eliminated.”

Reduction of exposure to unusually severe hazards,

physical hardships or unusually severe working condi-

tions to a level consistent with accepted standards AF

instructions, Occupational Health and Safety Admini-

stration (OSHA) or other recognized national consensus

standards.

The Arbitrator found that the AFLC/AFMC Supplements

provide that the OSHA PEL is the standard for entitlement of

unit employees to EDP for exposure to asbestos. See Award

at 127, 134. However, he ruled that “the manner in which the

Agency proceeded insofar as EDP was concerned, is not

binding upon the Union, unless the evidence establishes that

the Union consented to the standard.” Jd. at 127. In this

respect, the Arbitrator found that the evidence failed to

support any agreement or acquiescence by the Union to the

Agency’s use of the OSHA PEL. Apart from this finding, the

Arbitrator did not specifically address the effect of the

AFLC/AFMC Supplements in this case.

In reviewing the parties’ Master Labor Agreement (MLA),

the Arbitrator found that “there is no specific standard for

entitlement to EDP set forth in the contract.” Jd. at 112. He

found that the “words of the MLA were crafted with the

apparent intent to incorporate the bargaining objective of the

Union to avoid any definition of ‘practically eliminated.”* /d.

at 136-37. As a result of these determinations, the Arbitrator

ruled that “there is insufficient evidence to establish that the

parties agreed that the OSHA PEL would serve as the trigger

point for EDP.” /d. at 137.

Thereafter, on review of FLRA case precedent, the

Arbitrator ruled that in view of his determination that “the

24a

parties did NOT ever agree to a specific standard for

entitlement to EDP,” he was “left with the responsibility

and authority to determine whether the bargaining unit

employees . . . are entitled to EDP.” Jd. at 221 (emphasis in

original). He stated that his “finding that the parties did not

voluntarily consent to the use of the OSHA PEL as the

standard for entitlement to EDP, does not necessarily mean

that the OSHA PEL should not be the standard adopted by the

Arbitrator.” Jd. at 222. However, on review of the record, he

rejected the use of the OSHA PEL as the standard. Stating the

standard in terms of Appendix A to 5 C.F.R. § 532.511, he

found that EDP should be paid to any employee “who works

in an area where airborne concentrations of asbestos fibers

could possibly result in damage or sickness and safety

measures or devices have not essentially removed the

possibility of such damage or sickness.” /d. at 240.

Addressing the issue of remedy, the Arbitrator found that

the grievance was untimely, but that the Agency contributed

to its untimeliness. For purposes of calculating the appro-

priate amount of backpay, the Arbitrator “apportion[ed] fault

on an 80% and 20% basis.” Id. at 282. Accordingly, he ruled

that “[t]he Union’s claim, from 6 years prior to the filing of

the grievance until 20 calendar days prior to the filing of the

grievance, is discounted to 20%.” Id. He also found that there

were mitigating factors that required a further reduction in the

amount of backpay awarded. For this reason, he ruled that

“EDP is to be discounted to 50% from 6 years prior to the

filing of the grievance until the present.” Jd. at 283.

III. Positions of the Parties

A. Agency’s Exceptions

The Agency contends that the award is deficient on the

ground that it is contrary to regulation. In this regard, the

Agency contends that “[t]he Arbitrator’s conclusion that the

OSHA PEL was not the proper level for determining payment

25a

of environmental differential pay is contrary to the standard

established by a command-wide agency regulation issued

at the level of exclusive recognition.” Exceptions at 8. The

Agency maintains that “[t]he Arbitrator erred . . . when

he failed to recognize the AFMC regulation which defined

the level at which asbestos EDP would be paid. Therefore,

the Arbitrator’s decision is deficient . . . under 5 U.S.C.

{§] 7122(a)(1).” Id.

The Agency notes that under United States Dep’t of the

Army, Fort Campbell Dist., Third Region, Fort Campbell,

Ky., 37 FLRA 186 (1990) (Ft. Campbell), an award is

deficient when it conflicts with an agency regulation that

governs the matter in dispute. The Agency maintains that the

AFLC/AFMC Supplements govern the matter in dispute and

specify that the OSHA PEL is the standard for entitlement

to EDP for exposure to asbestos. In this regard, the Agency

contends that the Authority has “made clear that regulations

setting levels of exposure that warrant payment of EDP act

as a specific limit on an [a]rbitrator’s authority to otherwise

independently determine such a level[.]” Jd. at 11, citing

AFGE Local 2250, 52 FLRA 320, 323 (1996) (“in the

absence of a mandated quantitative level set by applicable

law or regulation or otherwise agreed to by the parties, the

arbitrator has the authority to determine the threshold

quantitative level of exposure for the payment of EDP”).

Thus, according the Agency, “it is clear that an AFMC

regulation establishing the trigger level of exposure for

EDP must be properly recognized and applied by the

Arbitrator.” Jd.

In arguing that the AFLC/AFMC Supplements govern, the

Agency maintains that the Arbitrator found that the Supple-

ments provide that the OSHA PEL is the Agency’s standard

for entitlement to EDP for exposure to asbestos. The Agency

notes that the Union conceded, and the Arbitrator found, that

the grievance would have been denied if the OSHA PEL were

26a

the standard for entitlement to EDP for exposure to asbestos.

The Agency also argues that the Supplements govern because

they are not inconsistent with the parties’ master labor

agreement. In this regard, the Agency notes that the AFMC

Supplement sets the standard for payment at the OSHA PEL,

and the Arbitrator interpreted the MLA as not setting forth

any specific standard for entitlement to EDP. According to

the Agency, “[s]etting ‘no specific standard’ does not conflict

with setting a standard at the PEL.” /d. at 18.

The Agency also contends that the award is contrary to law

and that it is based on nonfacts.

B. Union’s Opposition

The Union contends that the Agency has failed to establish

that the award is deficient.

The Union asserts that the Agency has failed to establish

any controlling regulation which specifies that employees

must prove exposure to asbestos in excess of the OSHA PEL

to be entitled to EDP. The Union argues for a number of

reasons that the Supplements are not controlling.

First, the Union argues that the Supplements are inconsis-

tent with the terms of other Agency regulations “which do not

reference or incorporate the OSHA PEL.” Id. at 23. Second,

the Union argues that the Supplements are “contrary to the

Agency’s historical handling and determination of EDP to

employees for asbestos exposure which have not entailed any

reference to or utilization of the OSHA PEL as the standard

for EDP.” /d. at 24. Third, the Union argues that the Supple-

ments are “inconsistent with the presentations and explana-

tions of the criteria for EDP which the Agency has

historically published to employees at KAFB [Kelly Air

Force Base] for at least the past 20 years that did not

reference and were, in fact, inconsistent with the utilization of

the OSHA PEL as the standard for EDP[.]” /d. at 25. Fourth,

the Union argues that the Supplements are “inconsistent with

Wasa al ey” le cielonndalled Gs

27a

internal Agency memoranda which state that OSHA stan-

dards are not applicable to KAFB.” /d. at 26.

Fifth, the Union argues that the Supplements do not govern

because they conflict with the master labor agreement. The

Union contends that “[t]he Agency contractually agreed

through the MLA that 5 C.F.R. [part] 532, not the AFMC

Supplement, established the standard and criteria for EDP.”

Id. at 27 (emphasis in original). The Union maintains that

Article 26 of the agreement plainly establishes that EDP is to

be paid in accordance with law and Government-wide

regulation. The Union claims that 5 C.F.R. § 532.511 is the

only Government-wide regulation that establishes standards

for the payment of EDP because the AFLC/AFMC Supple-

ments are clearly not Government-wide regulations. In

addition, the Union maintains that the Supplements conflict

with the agreement because “the arbitrator found and

interpreted the contract to mean that the parties agreed

through the [MLA] that the OSHA PEL would not be the

standard for EDP.” /d. at 41.

Sixth, the Union argues that “[t]he Agency cannot by

unilateral and self-serving regulation establish criteria for

entitlement to EDP: (a) that [are] different than the criteria

established by the Back Pay Act and EDP regulations; and

(b) which the Union does not agree, through contract, to

accept and utilize.” Jd. at 40. Seventh, the Union argues that

there are “practical and compelling safety reasons for not

tying EDP to the OSHA PEL.” /d. at 47. The Union maintains

that OSHA has determined that exposure to asbestos at levels

below the PEL still presents significant risks. Thus, the Union

argues this determination precludes the Agency’s position

that “only exposure above the PEL entails risk to employees

of potential asbestos illness or injury.” Jd. at 50.

Finally, the Union contends that the award is consistent

with FLRA case precedent. The Union contends that F LRA

case precedent holds that because Appendix A of 5 C.F.R.

28a

part 532 does not set forth any specified level of exposure to

asbestos required for the payment of EDP, an arbitrator is free

to determine what exposure to asbestos entitles employees to

EDP. See id. at 42-43.

C. Union’s Exception

The Union contends that the Arbitrator’s calculation of the

amount of backpay is contrary to law and regulation. The

Union argues that the Arbitrator’s reduction of backpay

below the environmental pay differential of 8% for exposure

to asbestos is inconsistent with the Back Pay Act and EDP

regulations.

D. Agency’s Opposition

The Agency contends that in the event that the Authority

does not find that the award is deficient on any basis asserted

by the Agency in its exceptions, the Arbitrator’s calculation

of the amount of backpay was within his authority.

IV. Analysis and Conclusions

A. Standard of Review

The Agency contends that consistent with law, the

AFLC/AFMC Supplements set the standard for payment of

EDP and that the award is inconsistent with that standard.

When a party’s exception disputes an award’s consistency

with law and regulation, we review the questions of law and

regulation raised by the award and the exception de novo.

See, e.g., United States Dep’t of Heaith and Human Services,

Centers for Medicare and Medicaid Services, Baltimore, Md.,

57 FLRA 704, 706 (2002). Reviewing the questions of law

and regulation raised by the award and the Agency’s

exception de novo, we conclude that the Supplements

permissibly set the standard for payment of EDP and that they

governed the resolution of the grievance because they are

specifically linked to the payment of EDP and because they

are not in conflict with the collective bargaining agreement.

29a

B. The AFLC/AFMC Supplements govern the payment

of EDP.

1. The standard for entitlement to EDP for exposure to

asbestos can be prescribed by an agency regulation.

While the Authority has had many EDP cases, it has not

previously been presented with a case where an agency had

prescribed the standard for entitlement to EDP by an agency

regulation; an arbitrator did not apply the standard prescribed

by the regulation in resolving a grievance over EDP; and the

agency filed an exception to that award alleging that the

award was deficient because it conflicted with the regulation.

The first question raised by the Arbitrator’s award and the

Agency’s exception is whether the standard for entitlement to

EDP can be prescribed by an agency regulatic >. We conclude

that it can be.

The Authority has repeatedly and uniformly described the

framework for determining entitlement to EDP for exposure

to asbestos, as follows:

Appendix A, which is identical to former Appendix J,

does not set forth any specified level of exposure

required for the payment of EDP. Accordingly, as was

the case under Appendix J, the specific work situations

for which EDP is payable are left to “local deter-

mination, including arbitration.”

E.g., United States Dep’t of the Army, Red River Army

Depot, Texarkana, Tex., 53 FLRA 46, 51 (1997) (Red River

Army Depot) (quoting AFGE Local 2280, 51 FLRA 620, 623

(1995); AFGE Local 1482, 50 FLRA 572, 574 (1995)). As

noted by the Union in its opposition, the Authority has

specifically held that an “arbitrator is free to determine the

quantitative level of exposure for payment of EDP.” E. g., Red

River Army Depot, 53 FLRA at 51. At the same time, the

Authority has expressly limited that freedom by adding that

the arbitrator is free to determine the level of exposure only

30a

“[i]n the absence of a mandated quantitative level set by

applicable tlinelaw or regulation or otherwise agreed to by the

parties.” /d. (quoting Allen Park Veterans Admin. Med. Ctr.,

34 FLRA 1091, 1101 (1990)).

We find no basis for not interpreting the reference to

“regulation” to include an agency regulation. As the Au-

thority has expressly acknowledged, each Federal agency

prescribes rules, regulations, and official declarations of

policy to govern and control the resolution of matters to

which they apply within the agency. See Ft. Campbell, 37

FLRA at 193-94. Moreover, the Authority has indicated in

two asbestos cases that an agency regulation would have been

viewed as permissibly prescribing the standard for entitle-

ment to EDP if the regulation had been sufficiently linked to

the payment of EDP. See United States Gen. Services

Admin., Kansas City, Mo., 38 FLRA 438, 445 (1990) (GSA);

United States Dep’t of Justice, Bureau of Prisons, Fed. Corr.

Inst., El Reno, Okla., 37 FLRA 559, 563 (1990) (FCI, El

Reno).

The decision in O’Neall v. United States, 797 F.2d 1576

(Fed. Cir. 1986) (O'Neal!) provides additional support for an

agency being empowered to set, by regulation, the standard

for entitlement to EDP for exposure to asbestos. In O’Neall,

the court sustained the action of the Department of the Air

Force in setting by regulation the standard of exposure to

asbestos in order to be entitled to EDP at the same level as the

OSHA PEL. In finding that the Department of the Air Force

had acted reasonably, the court specifically ruled that

deference was due the choice of the Department. See O’Neall,

797 F.2d at 1581 n.7.

Accordingly, contrary to the Union’s arguments, Authority

precedent and the court’s decision in O’Neall support the

conclusion that an agency can prescribe by regulation the

standard for entitlement to EDP for exposure to asbestos.

3la

2. The AFLC/AFMC Suppiements sufficiently link expo-

sure at the OSHA PEL to the payment of EDP.

A critical question raised by the Authority precedent

discussed above is whether the AFLC/AFMC Supplements

sufficiently link exposure at the OSHA PEL to the payment

of EDP. We conclude that they do.

Both GSA and FCI, El Reno indicate that a critical ques-

tion in determining whether an agency regulation governs

entitlement to EDP is whether the regulation is sufficiently

linked to the payment of EDP. In this case, there is no dispute

that the AFLC/AFMC Supplements provide that employees

must be exposed to asbestos at, or in excess of, the level of

the OSHA PEL in order to be entitled to EDP.

The Agency clearly asserts that the Supplements set the

level of exposure for EDP and notes that the Authority defers

to an agency’s interpretation of its own regulations. In

addition, the Arbitrator also viewed the Supplements as

setting the level of exposure for EDP. The Arbitrator specifi-

cally found that the Supplements provide that the OSHA PEL

is the standard for entitlement to EDP for exposure to

asbestos. See Award at 127, 134. Moreover, although the

Union disputes that the Supplements govern the standard for

EDP, the Union does not dispute that the Supplements link

exposure at the OSHA PEL to the payment of EDP.

The Authority has repeatedly held that “[a]n agency’s

interpretation of its own regulation generally is controlling

unless clearly erroneous or inconsistent with the regulation’s

plain wording.” E.g., United States Dep’t of Transportation,

Fed. Aviation Admin., 55 FLRA 797, 801 (1999) (FAA). We

find that the Agency’s interpretation of the Supplements is

controlling because it is neither clearly erroneous nor

inconsistent with the plain wording of the Supplements.

Accordingly, we conclude that the AFLC/AFMC Supple-

32a

ments specifically link the payment of EDP to exposure at, or

in excess of, the OSHA PEL.

3. The use of the OSHA PEL is appropriate as a standard

for entitlement to EDP for exposure to asbestos.

A question raised by the Union’s opposition is whether use

of the OSHA PEL as a standard for entitlement to EDP is

appropriate. We conclude that it is.

In disputing that the Supplements govern the standard for

EDP, the Union argues that there are “practical and compel-

ling safety reasons for not tying EDP to the OSHA PEL.”

Opposition at 47. The Union maintains that OSHA’s actual

determinations preclude the Agency’s position that “only

exposure above the PEL entails risk to employees of potential

asbestos illness or injury.” Jd. at 50. The Union’s arguments

are similar to arguments made by the employees in O’Neall

and rejected by the court.

The court in O’Neall was not persuaded of any material

differences in the OSHA and EDP regulatory schemes which

made it improper to look to OSHA for guidance in setting a

standard for the level of exposure to asbestos in order to be

entitled to EDP. In particular, the court rejected the argument

that use of the OSHA PEL was inconsistent with the mandate

of FPM Supplement 532-1 to compensate for working

conditions involving unusually severe hazards. See O'Neal,

797 F.2d at 1582.

In addition, although the Authority has never been

presented with a case just like this one, the Authority has

been presented with several cases in which the arbitrator

applied the OSHA PEL to determine entitlement to EDP. In

none of these cases did the Authority question whether the

OSHA PEL was appropriate for use as an EDP standard. See

NAGE Local R4-78, 56 FLRA 418 (2000); AFGE Local

2004, 55 FLRA 6 (1998); AFGE Local 2250, 52 FLRA 320

(1996); AFGE Local 2144, 51 FLRA 834 (1996); AFGE

33a

Local 2280, 51 FLRA 620 (1995); AFGE Local 1482, 50

FLRA 572.

4. The AFLC/AFMC Supplements do not conflict with the

collective bargaining agreement.

Agency rules and regulations “govern the disposition of

matters to which they apply . . . when the rules and

regulations do not conflict with provisions of an applicable

collective bargaining agreement.” Ft. Campbell, 37 FLRA at

195. The AFLC/AFMC Supplements clearly apply to the

disputed matter of the standard for entitlement to EDP for

exposure to asbestos by providing that the standard is the

OSHA PEL. On the basis of the Arbitrator’s interpretation of

the agreement, we find that the Supplements do not conflict

with provisions of the agreement.

The fact that the Supplements set the standard for

entitlement to EDP for exposure to asbestos at the OSHA

PEL does not conflict with the contractual obligation under

Article 26 to pay EDP in accordance with law, Government-

wide regulation, and the collective bargaining agreement,

none of which prescribes a standard for the payment of EDP

for exposure to asbestos. As the Arbitrator expressly ruled,

“there is no specific standard for entitlement to EDP set forth

in the contract,” award at 112, and the parties had not

“agree[d] to a specific standard for entitlement to EDP,” id. at

221. Therefore, the Arbitrator interpreted the parties’ agree-

ment as not setting forth a specific standard for entitlement to

EDP.

Where, as here, an agreement does not set a specific

standard and an applicable agency regulation does set a

specific standard, the agreement does not conflict with the

agency regulation and the agency regulation governs the

matter in dispute. See NAGE Local R12-33, 51 FLRA 541.

543 (1995) (an agency regulation governed the matter in

dispute because it provided the “dispositive criteria” for

34a

determining eligibility, while the agreement did not); United

States Dep’t of the Army, Army Communications-Electronics

Command, Ctr. for Command, Control and Communications

Sys., Fort Monmouth, N.J., 46 FLRA 555, 558 n.4 (1992) (an

agency regulation governed the matter in dispute because the

collective bargaining agreement did “not substantively

address” the matter in dispute); United States Dep’t of

Veterans Affairs, Regional Office, Chicago, 38 FLRA 356,

358 (1990) (VA Chicago) (an agency regulation that permit-

ted the agency’s actions governed the matter in dispute be-

cause the collective bargaining agreement was “silent” on the

matter). Accordingly, we find that the Supplements do not

conflict with the agreement, as interpreted by the Arbitrator,

and that they govern the matter in dispute as to what standard

applies in this case to EDP for exposure to asbestos.

In this regard, we note that the Arbitrator erred as matter of

law when he held that “the manner in which the Agency

proceeded insofar as EDP was concerned, is not binding upon

the Union, unless the evidence establishes that the Union

consented to the standard.” Award at 127. The proper

statement of the law is that where an agency regulation sets a

specific standard that addresses a matter in dispute, that

standard applies unless it conflicts with the parties’ collective

bargaining agreement. See Ft. Campbell, 37 FLRA at 195.

Accordingly, the applicability of the standard set forth in the

Supplements does not depend on the Union’s consent to the

standard; rather, the Supplements govern unless the parties’

agreement provides otherwise.

Here, the Arbitrator, in interpreting the parties’ agreement,

found only that the parties did not agree to the use of a

specific standard. He did not interpret the agreement to find

that the parties intended to preclude the Supplements from

governing. In fact, as noted above, he stated that his “finding

that the parties did not voluntarily consent to the use of the

OSHA PEL as the standard for entitlement to EDP, does not

35a

necessarily mean that the OSHA PEL should not be the

standard adopted by the Arbitrator.” Jd. at 222.

After having interpreted the agreement to find that “the

parties did NOT ever agree to a specific standard for

entitlement to EDP,” the Arbitrator concluded that he “‘is left

with the responsibility and authority to determine whether the

bargaining unit employees herein are entitled to EDP.” Jd. at

221 (emphasis in original). However, the Arbitrator erred, as

a matter of law, in concluding that where the parties had not

agreed on a specific standard, it was his authority to

determine the standard. Before concluding that he had such

authority, the Arbitrator was required to have considered

whether applicable law or regulation set a mandated quanti-

tative level. Consistent with Authority precedent referenced

above, where an arbitrator finds that an agreement does not

set a specific standard, he or she must examine whether law

or regulation, including, as here, an applicable agency

regulation, does set a specific standard. See AFGE Local

2250, 52 FLRA at 323 (“in the absence of a mandated

quantitative level set by applicable law or regulation or

otherwise agreed to by the parties, the arbitrator has the

authority to determine the threshold quantitative level of

exposure for the payment of EDP”) (emphasis added). In

these circumstances, by operation of Fort Campbell, the

agency regulation controls.

We note that parties may, of course, choose in their

collective bargaining agreements to reject or modify the

applicability of agency regulations to particular situations.

Where they do so, the agency regulation would conflict with

the agreement provision and, by operation of Fort Campbell,

the agreement provision would control. For example, in this

case, had the parties agreed to a different specific standard

from that set forth in the Supplements, or agreed that the

standard would not be determined by the Supplements, the

agreement provision would conflict with the Supplements

36a

and, therefore, the agreement provision would control. How-

ever, neither of these situations was present in this case.

As noted above, the Arbitrator found that “the parties did

NOT ever agree to a specific standard for entitlement to

EDP{.]” Jd. at 221 (emphasis in original). The parties’ failure

to agree to a specific standard is not the same as saying that

the parties agreed that entitlement to EDP would be made on

a case-by-case basis. Once the Arbitrator found that there was

no specific standard agreed to, he was obligated to determine

whether a mandated quantitative level was set by, as relevant

here, an applicable regulation. He failed to do so. Rather, he

erroneousiy went on to conclude that because the parties had

not agreed to a specific standard, he could determine the

standard without reference to the Supplements and that he

was free to determine the standard to be applied in this case.

The Union also fails to establish that the Supplements do

not govern on the ground that they are inconsistent with other

agency regulations, memoranda, or explanations on EDP or

because they are inconsistent with the Agency’s historical

handling of EDP for exposure to EDP. Without addressing

the issue of what kind of promulgation or actions would be

necessary to override the application of a formal regulation

promulgated at the command level of AFMC, none of the

documents referenced by the Union establishes a standard for

entitlement to EDP for exposure to asbestos that is in-

consistent with use of the OSHA PEL or precludes the use of

the OSHA PEL as the applicable standard.

Accordingly, we find that the AFLC/AFMC Supplements

do not conflict with the agreement, as interpreted by the

Arbitrator, and that the Supplements govern the matter in

dispute of what standard applies to EDP for exposure to

asbestos.

37a

C. The award is deficient.

Under § 7122(a)(1) of the Statute, an arbitration award will

be found deficient if it is contrary to any law, rule, or

regulation. For purposes of § 7122(a)(1), the Authority has

defined “rule or regulation” to include both Government-wide

rules and regulations and governing agency rules and

regulations. See, e.g., FAA, 55 FLRA at 801 (citing Ft.

Campbell, 37 FLRA 186).

As the Supplements set the OSHA PEL as the governing

standard for EDP, the Arbitrator’s application of a different

standard is deficient as contrary to governing regulation. See,

e.g., FAA, 55 FLRA at 802 (because the award was in-

consistent with an agency regulation that governed the matter

in dispute, the award was deficient under § 7122(a)(1) of the

Statute).

D. Appropriate Action

As to the question of what action is appropriate, we will set

the award aside in its entirety. See, e.g., United States Dep’t

of the Treasury, United States Customs Serv., Port of New

York and Newark, 57 FLRA 718 (2002), petition for review

filed sub nom. NTEU Chapter 161 v. FLRA, No. 02-1153

(D.C. Cir. May 17, 2002) (when the FLRA found the basis

for an award of backpay was erroneous, the FLRA set aside

the backpay award); cf. United States Dep’t of Def., Def.

Logistics Agency, Def. Distribution Region West, Tinker Air

Force Base, Okla., 53 FLRA 460 (1997) (award was set aside

because the arbitrator would have reached a different result if

he had not misapprehended the status of a union representa-

tive). In agreement with the Agency, we view the record as

reflecting that the Arbitrator would have denied the grievance

had he applied the OSHA PEL as the standard for entitlement

to EDP. See Award at 122.

38a

V. Decision

The award is set aside.°

Member Pope, dissenting:

I agree with the majority that, in the absence of a con-

flicting collective bargaining agreement provision, an

agency regulation may establish a quantitative standard

constituting the level of exposure to asbestos sufficient

to trigger environmental differential pay (EDP). In my

view, this is a straightforward application of the holding

in Allen Park Veterans Admin. Med. Ctr. that an arbitra-

tor may set a quantitative level triggering EDP “[i]n the

absence of a mandated quantitative level set by applica-

ble law or regulation or otherwise agreed to by the

parties.” 34 FLRA 1091, 1101 (1990).

I do not agree with the majority, however, that the Agency

regulation controls in this case. In my view, the majority

misapplies the basic principle that “collective bargaining

agreements, and not agency rules and regulations, govern the

disposition of matters to which they both apply when there is

a conflict between the agreement and the rule or regulations.”

United Stated Dept. of Agriculture, 51 FLRA 1210, 1216

(1996) (quoting United States Dept. of the Army, Ft.

Campbell Dist., 37 FLRA 186, 194 (1990) (Fort Campbell)).

The parties’ agreement provides that EDP will be paid

“fiJn accordance with Federal Law, Government-wide

regulations and this Agreement.” Award at 112 (quoting

Article 26.01). As interpreted by the Arbitrator, this provision

contemplates case-by-case standards for EDP entitlement to

be established in arbitration—not a predetermined quantita-

> In view of this decision, we need not resolve the Union’s exception

and the Agency’s other exceptions to the award. In addition, we believe

that the positions of the parties on the issue on which this decision is

based were adequately presented and that oral argument was not

warranted.

39a

tive standard established by Agency regulation. Thus, under

Fort Campbell, the agreement conflicts with, and therefore

takes precedence over, the predetermined quantitative stan-

dard established in the Agency’s regulation. In my view, this

simple analysis dictates rejection of the Agency’s exception

that the award conflicts with the Agency regulations.

The majority strains to find that the Agency regulation

controls because it does not conflict with the agreement. In so

doing, the majority ignores the record in this casé. In

particular, the Arbitrator made extensive, specific findings

regarding the parties’ intent in agreeing to Article 26.01.

According to the Arbitrator’s uncontested finding, the parties

“entered negotiations . . . with very different objectives

insofar as the issue of EDP was concerned.” Award at 114. In

particular, the Agency wanted “an exact trigger point for

when EDP entitlement would be activated” and the Union

wanted this to “be determined on a case-by-case method by

arbitrators.” /d. The Arbitrator specifically rejected - as

“patently unbelievable”’—Agency witness testimony that the

Union agreed that Article 26.01 incorporated the permissible

exposure limit (PEL) set by OSHA as the trigger for EDP. /d.

at 126. He concluded that the agreement was “crafted with

the apparent intent to incorporate the bargaining objective of

the Union to avoid any definition of’ the EDP trigger level.

Id. at 137. These arbitral findings compel a conclusion that

the parties’ agreement establishes a case-by-case trigger for

EDP entitlement and, as a result, conflicts with the Agency

regulation. *!

“' | am at a complete loss to understand the majority’s bald assertion

that the Arbitrator’s findings are not the “same as” a conclusion that “the

parties agreed that entitlement to EDP would be made on a case-by-case

basis.” Majority Opinion at 16. As set forth above, the Arbitrator clearly

and specifically found that: (1) the Union’s bargaining objective was to

avoid agreeing to “any trigger point” and, instead, to “allow[] the

definition of ‘practically eliminated’ to be determined on a case-by-case

40a

The majority distorts the award by relying on the

Arbitrator’s statements that Article 26.01 contains “no

specific standard” to trigger EDP and that the parties had not

““agree[d] to a specific standard.”’ Majority at 13 (quoting

Award at 112, 221). It is clear, in this regard, that in finding

the parties did not agree to a specific standard, the Arbitrator

found that they did not agree to a specific predetermined,

quantitative standard. As noted above, the Arbitrator un-

deniably rejected the Agency’s argument that the Union had

agreed to adopt the OSHA standard and found, as a matter of

contract interpretation, that the agreement incorporated the

Union’s position that the standard would be determined case-

by-case in arbitration. Thus, the majority is permitting the

Agency to accomplish precisely what Fort Campbell pro-

hibits: trumping a collective bargaining agreement with a

conflicting Agency regulation.

The majority adds insult to injury by concluding that the

Arbitrator “erred, as a matter of law” in concluding that the

Agency regulation was not binding unless the Union

consented to it. Majority Opinion at 15. The majority

concedes, in this regard, that the Union’s consent would be

required if the regulation “conflict[ed] with the parties’

collective bargaining agreement.” /d. at 14. As the Arbitrator

found that the contract article incorporated the Union’s

obiective to have a case-by-case standard, and rejected the

Agency’s objective that the standard contained in the

regulation be incorporated, there can be no doubt that such a

conflict exists.

method by arbitrators,” and (2) “the words of [the parties’ agreement]

were crafted with the apparent intent to incorporate the bargaining

objective of the Union to avoid any definition of ‘practically eliminated.”*

Award at 114, 136-37. The majority’s unfortunate refusal to acknowledge

these facts—or otherwise explain its reasoning—creates the impression

that it is reviewing a much different award than the one actually before us

and can only cause confusion.

4la

The Authority has consistently held that the specific work

situations for which EDP is payable are left to local

determination, including arbitration. AFGE, Local 2250, 52

FLRA 320, 322 (1996). The Arbitrator’s conclusion that the

parties negotiated over this issue and determined that no

quantitative level would be set is fully consistent with this

precedent and the statutory scheme for collective bargaining.

Accordingly, the award is not deficient as inconsistent with

the Agency regulations.

In sum, I believe the majority errs in setting aside the

award as inconsistent with the Agency regulations and in

failing to analyze the remaining exceptions.

APPENDIX D

IN THE MATTER OF ARBITRATION

FMCS CASE NO. 99-17655

AMERICAN FEDERATION OF GOVERNMENT

EMPLOYEES LOCAL UNION No. 1617,

Union,

and

SAN ANTONIO AIR LOGISTICS CENTER, KELLY

AIR FORCE BASE, SAN ANTONIO, TEXAS,

Employer.

BEFORE LARRY D. SMITH, ARBITRATOR

APPEARANCES:

For the Union:

Mr. Brian Bishop, Attorney

Gray & Becker

900 West Avenue

Austin, TX 78701 -22 10

Mr. Hal Gillespie, Attorney

Gillespie, Rozen & Watsky

3402 Oak Grove Avenue, Suite 200

Dallas, TX 75204

For the Employer:

Mr. Bud Glavy, Attorney

Department of the Air Force

Kelly Air Force Base

204 Lombard

Kelly AFB, Texas 78241

Ansa

Major Douglas Cox and other attorneys

General Litigation Division

Air Force Legal Services Agency

AFLSA/JACL

1501 Wilson Blvd., Suite 707

Arlington, VA 22209-2403

- 44a

TABLE OF CONTENTS

Background; Facts not in dispute, Issues and

Jurisdiction, Applicable Statutory, Regulatory, and

I, Ci cisscctnensttesnnincsiinshnninrarrinciinviasianinnnnss

TE TE. TRE PIII cccscessieracecrsesisnsnsricsacerssnsansenss

I Se > II istics ntarnercrcricantarrnictmrnsinnienns

ENN TIN” IIIS ici chidadenensnanetuilcaieniinninscantannaienn

Section 1.04 Relevant Contract Sections....................

Section 1.05 The History of Kelly Air Force Base: ...

Section 1.06 Historical Overview of Collective Bar-

I scinssiniisonsiesiiniassiteibeicnetibtiapnliadiesiinissincunaiiadaitiaubhdnninen

Section 1.07 Relevant Statutory and Government

Wide Regulation Language Regarding Exposure to

Dangerous Conditions Including Asbestos: ..............

Section 1.08 Air Force Regulations and Kelly AFB

LDUPOCUE VOR TIOR TOMI. ccs nccccscassscsssesesenreesonssccssenasecs

Section 1.09 What is Asbestos?:............cccccssesseeseeees

Section 1.10 Asbestos Related Injury and Illness: .....

Section 1.11 Federal Regulations of Asbestos: ..........

Part II.

Kelly AFB Asbestos Incidents, Selected Exhibits: .......

Section 2.01 I Selected Exhibits of Kelly AFB

Pa I cnisteesir tiateneciathancitasteiahiaiahiiaianaearcnit

Section 2.02 The Unions Grievance and _ the

PT 0: FI vsccicnciecnnshninstnnipeetinacinniniatacinnn

Page

45a

TABLE OF CONTENTS—Continued

Section 2.03 Pre-Hearing Orders?.........ccccccccsssscseseseees

Section 2.04 AFGE Council 214 v. McClellan AFB. ....

Section 2.05 AFGE Local 916 v. Tinker AFB:...........

Section 2.06 AFGE Local 91 6 v. United States Air

PE CE PITIEE xiisicssnitennisicssnstndnsncinndicnictsticcuictansann

Section 2.07 AFGE Local 161 7 v. Kelly AFB:..........

Section 2.08 AFGE Local 1617 1’. Kelly AFB..........

Section 2.09 Prior Article 25 and 26 Grievances and

Protest Gy Local 161 73 .....<ccccsssccscscsecccseceseessasecesseseee

Part III.

Threshold Issue Standard for EDP? ........c.ccccccccscssseseseee.

Section 3.01 Summary of the Competing Positions:..

Section 3.02 The Bargaining History of Articles 25

NIUE I siseticsesnnietiininieseitdnicsndtapdisteiliintepitanincponateiaaasisaside

Section 3.03 Agency Evidence that Post-MLA

Course of Dealing Shows an Intent to use OSHA

PEL- “Givens letter”, AFOSH Regulations, Griev-

ances and Arbitrations: ............cccccccscccsssssessesseseceeseeee

Section 3.04 Did the Parties Agree that the OSHA

PEL Would Determine Entitlement to EDP?............

Section 3.05 Does the Course of Dealing Between

the Parties Subsequent to the MLA Evidence an

107

112

113

119

12]

127

46a

TABLE OF CONTENTS—Continued

Section 3.07 Conclusion: The Evidence is Insuf-

ficient to Establish that the Parties Agreed to be

Bound by the OSHA PEL as the Standard for EDP..

Part IV.

Threshold Issues Continued,

Fagenedinees Od ATOUr MALY on..ccccscccssescscscocenssssevssnscennns

Section 4.01 Terms of the Contract Relating to

Section 4.04 The Duty to Notify: .......... ee eeceeeeeeees

Section 4.05 Selected Exhibits Regarding Timeli-

TOI, <r caninicoecnincrinceniennammehaiaaaanaaaa

Section 4.06 Testimony on the Matter of Timeli-

MMII ..xscsecsncasinieinindannniitithionnnasasaataaienaannaeaaae

Section 4.07 Conflicting Duties Under the Contract: ....

Section 4.08 Did the Union Comply with Section

6.09? Did the Agency Comply with Section 25.11? ..

Section 4.09 Assessing the Responsibility Percen-

IG, ssn.sincsoniarsmsatntceanintinnacasneneaieaeee

Section 4.11 Findings on the Threshold Issues: .........

Page

136

137

138

140

143

149

153

155

170

174

175

47a

TABLE OF CONTENTS—Continued

PART V

Merits of the Grievance,

Questions to be Addressed oo........ccccccccccccsecsceesececeeeeeese-.

Section 5.01 The Ambient Air...........cccccccccccccccoseccseees

Section 5.02 Indoor Levels of Asbestos? ......cccccccc00--..

Section 5.03 Fact Witmesses? ..0......c.ccccccccccsssssescecesesees

Section 5.04 Expert Witnesses: ........ccccccccccccccsececececes

Section 5.05 Medical Records Maintained by Kelly

Section 5.06 Union Sponsored Chest Screenings and

Summary of Findings of Expert B-Readers: .............

Section 5.07 Air Sampling Reports? ..........cccccccccsscesees

Section 5.08 The Agency’s Position Regarding the

Appropriate Standard for the Payment of EDP.........

Section 5.09 The Union’s Position Regarding the

Appropriate Standard for the Payment of EDP.........

Section 5.10 Should the OSHA PEL be used to

Determine Eligibility for EDP? ............ccccccccccccccseseces

Section 5.11 If not the OSHA PEL, then what is the

Standard for EDP Entitlement? .............cccccccccccecc--....

A. The positions of the Parties Represents Ex-

tremes and Creates Difficulty in Reaching a

ors ss ccsnscscansepnassesaceasecerssoanes

B. OSHA v. the Agency on the Matter of Linear

a csshssnssssasnsnsansnsocesverncervcceseane

231

232

48a

TABLE OF CONTENTS—Continued

D. Regulatory Language Pertaining to EDP En-

TT cisicsctssictdaieasccannstecstinscneictomsticmanidnaeeiaaghiaesaaieicane

E. How Regulatory Language Effects the Bur-

AO IIE stiisticanitonisnidinia sine rulddastecnamutnes

PART VI.

Tying Everything Together

The Standard for Asbestos EDP Under the MLA

Airborne Concentrations of Asbestos Fibers

Potential for Injury or Illness

UUITIOS RN a i iasscicstaeechanctnadaiastonmancanecasewecne

Section 6.01 Vastness of the Case?............ccccsesseeeee

Section 6.02 Have Bargaining Unit Employees Been

Exposed to Airborne Concentrations of Asbestos

PRRMONE isiestaeceiaheiansmaainisel cui ata cael mianasalies

Section 6.03 Is it Reasonably Possible that such Ex-

posure may Result in Injury or Illness?.....................

1. The air sampling data, and other evidence,

demonstrates that the historic asbestos exposure

levels has substantially exceeded asbestos levels

found in the ambient Qir..................ccscscsssssscesssesees

2. The air sampling data, and other evidence,

demonstrates that the historic asbestos exposure

levels has substantially exceeded asbestos levels

normally found in a well maintained building.......

3. There is substantial reason to believe that

exposure to low-level concentrations of chry-

sotile asbestos may lead to asbestos related

a OR AEN eR TOE

Page

249

251

253

49a

TABLE OF CONTENTS—Continued

Page

4. The risk of asbestos related injury or illness

increases as the length of the exposure period

NO iticane osacaetcuean eae 255

5. Kelly AFB medical records verify that certain

employees contracted asbestos related injury or

Fi siiccascmnsanettccnmsccatiiicomuncta dale asttaehcs sesaicats: 256

6. Kelly AFB documents reveal isolated epi-

sodes of high release of asbestos fibers. ................. 257

7. Kelly AFB records document that the job

duties of certain bargaining unit positions require

contact and/or exposure to asbest0S..........cccccecc00-. 258

8. It is possibile that historic air sampling results

understate the level of asbestos exposure

experiences by unit employees. ...........cecccecsesececeees 258

9. The effectiveness of abatement projects in

lowering asbestos exposure levels is question-

TSE EE I ee 260

10. Kelly AFB disclosed known hazardous con-

ditions to lessees and to the Greater Kelly

Development Counsel, including the presence of

Pei sikecientstcinuetaaniienas isealacinahitldamhados mami 261

Section 6.04 Presence of Pleural Plaques Not

Rn IIIITL sinskeniiciceunnliccaesamssutedsieaetenets ace 261

Section 6.05 Has Protective Equipment or other

Safety Device Essentially Removed the Possibility

of Asbestos Related Injury or Illness? .........c.cce.0.0.... 263

Section 6.06 The Preponderance of Evidence Estab-

lishes Eligibility to EDP for Kelly AFB Unit

I titniresilimomboninadieemncoavanainn es: 270

50a

TABLE OF CONTENTS—Continued

PART VII. Page

Mitigation

TY cies ssenicisentntiniaepianmmeniedee enn 270

Section 7.01 Bargaining Unit Employees are En-

COG 0 EI isssiicsctcrsasaepancaeaee 271

Section 7.02 Determining an Appropriate Remedy -

Factors of Mitigation: .............:ccccscsssssessssesessesescsseese ss 271

PART VIII.

NID x s:ss<cisvceteseiininichileuiaaaeeeeea ee 281

PART IX.

Jurisdiction is Retained

PO COR icssincinnnnsuindaonmanasg ae . 284

Section 9.01 Jurisdiction is Retained.......................... 284

Sla

AWARD AND OPINION

The above captioned matter came on to be heard on

October 16, 2000. The hearing continued on consecutive

business days until completed on October 31, 2000. The

parties were ably represented, given ample opportunity to

examine and cross-examine the witnesses, to introduce

relevant evidence, to be heard in connection with any

objection, to offer oral and written argument, and to file pre

and post-hearing briefs. Following very careful consideration

of the voluminous record, the Arbitrator makes the following

findings of fact and legal conclusions therefrom:

PART I

Background: Facts Not In Dispute,

Issues and Jurisdiction,

Applicable Statutory, Regulatory, and Contract Language

Section 1.01

The Parties

The parties hereto are the Department of the Air Force,

Kelly Air Force Base, hereinafter referred to as the Agency or

Employer, and the American Federation of Government

Employees Local Union No. 1617, hereinafter referred to as

the Union.

Section 1.02

Jurisdiction

The parties stipulated that the Arbitrator was properly

selected, pursuant to the parties’ collective bargaining agree-

ment, and that the Arbitrator has jurisdiction to determine all

the issues as set forth, infra.

52a

Section 1.03

Issues

a) Is the dispute arbitrable?

b) Was the grievance timely filed?

c) Did the parties contractually agree that entitlement to

Environmental Differential Pay would be tied to the

OSHA Permissible Exposure Limit?!

d) Did the Agency violate any provision of the parties’

collective bargaining agreement by failing and refusing to

pay Environmental Differential Pay?

e) What remedy, if any, is appropriate?

Section 1.04

Relevant Contract Sections

ARTICLE 1—PARTIES TO THE AGREEMENT

This labor-management Agreement is executed pursuant to

the exclusive recognition of the National Office American

Federation of Government Employees (AFGE), AFL-CIO,

hereinafter referred to as the Union, as the certified bar-

gaining agent for the consolidated bargaining unit of

employees defined in Article 2 below and employed by the

Air Force Materiel Command (AFMC), hereinafter referred

to as the Employer. In accordance with the provisions of Title

VII of the Civil Service Reform Act of 1978 (CSRA), the

following articles constitute the collective bargaining Agree-

ment into by an between the Union, on kchalf of the

American Federation of Government Employees, Council

Number 214, AFMC Locals, and the Employer.

' Issues a-c were identified in a pre-hearing Order dated April 24,

2000.

53a

The reference to rules, regulations and policies throughout

this Agreement refer to the rules, regulations and polices (sic)

effective upon the date of execution of this Agreement.

References to days throughout this Agreement refer to

calendar days, whether stated as “days” or “calendar days”,

unless specifically referred to as ‘‘work days”.

ARTICLE 2—RECOGNITION AND COVERAGE

Section 2.01: Recognition and Coverage

Subject to the inclusions listed in Section 2.02 and the

exclusions listed in Section 2.03, the units to which this

Agreement is applicable are composed of all nonsupervisory,

nonprofessional employees at the following Air Force

Materiel Command facilities paid from appropriated funds

and who are serviced by AFMC Civilian Personnel Offices:

a. Hill Air Force Base, Ogden, Utah

Kelly Air Force Base, San Antonio, Texas

McClellan Air Force Base, Sacramento, California

Newark Air Force Base, Newark, Ohio

Robbins Air Force Base, Warner Robins, Georgia

Tinker Air Force Base, Oklahoma City, Oklahoma

Wright-Patterson Air Force Base, Dayton, Ohio

Cataloging and Standardization Center, Battle Creek,

Michigan

b. The parties acknowledge that the existing certificate

may be amended/clarified in the future to include

employees (as described above) not presently covered

by this Agreement. Upon receipt of a new certification

from the Federal Labor Relations Authority, Council 2

14, as the exclusive representative, and AFMC shall

meet and negotiate over provisions of this Agreement

which affect any additiona/new activities being

certified. The parties agree to modify this contract or

negotiate (through delegation) a local supplement for

54a

each new activity to satisfy the requirements of any

article of the Agreement which may specifically

identify Locals or numbers.

Section 203: Exclusions

The following are excluded from the unit:

Management officials, supervisors, professionals, employ-

ees engaged in federal personnel work other than a purely

clerical capacity, and employees paid from nonappropriated

funds. . .

Article 3—Rights and Obligations

Section 3.01: Conformance to Law

In the administration of all matters covered by this

Agreement, officials of the Employer and the Union and

employees of the bargaining unit are governed by all

applicable laws, rules, and regulations.

Article 6—Negotiated Grievance Procedure and Alternative

Dispute Resolution

Section 6.01: Scope and Coverage

This Article shall constitute the sole and exclusive pro-

cedure available to the Employer and the Union, and

employees of the bargaining unit for the resolution of

grievances subject to the control of the Employer applicable

to any matter involving the interpretation, application, or

violation of this Agreement or local supplements thereto, any

matter involving the working conditions, or any matter

involving the interpretation and application of policies,

regulations: and practices of the Air Force, AFMC, and

subordinate AFMC activities not specifically covered by this

Agreement.

55a

Section 6.04: Extensions of Time Limits

Time limits in this Article may be extended by mutual

agreement of the Employer and the Union. Mutual agreement

must be in writing and signed by the activity Local Union

President, or a designated representative, and the activity

Labor Relations Officer, or a designated representative.

Management’s failure to respond or meet will permit the

grievance to be elevated to the next step.

Section 6.09: Union or Employer Grievances at Activity

Level

For grievances between the Employer and the Union at the

activity level, the following procedures apply.

c. If the Union is aggrieved, the president or designee of

the resident activity AFGE Local shall submit the grievance

in writing to the Commander or designee of the activity

within 20 calendar days of the act or awareness of the act

causing the grievance. . .

Article 7—Arbitration

Section 7.05: Questions of Grievability/Arbitrability

The arbitrator shall have the authority to make all

grievability and/or arbitrability determinations. Questions of

arbitrability involving the applicability of statutory appeals

shall be submitted to an arbitrator by brief, and decided prior

to a hearing, unless otherwise mutually agreed upon. If the

arbitrator determines there is a reasonable basis that the issue

is arbitrable, he will hear the merits of the underlying

grievance and decide the issues together. Upon mutual

agreement of the parties, such threshold issues may be

submitted to the arbitrator by brief, and decided prior to a

hearing on the merits of the underlying grievance.

* * * &

ren enineaetienoenrecemmeeneatl

56a

Section 7.06: Proceedings—Arbitrator’s Authority—A ward

The arbitrator’s authority is limited to deciding only the

issue or issues considered in the formal grievance. If the

parties fail to agree on a joint stipulation of the issue for

arbitration, then each shall submit a separate stipulation and

the arbitrator shall determine the issue or issues to be heard.

The arbitrator is empowered to fashion an appropriate remedy

consistent with the terms of this contract and in accordance

with applicable law, rule or regulation. Either side reserves

the right to argue to the arbitrator what such an appropriate

remedy should be.

The arbitrator’s award shall be binding on the parties and

implemented upon receipt, unless appealed and stayed. Either

party may file exceptions to the arbitrator’s award in ac-

cordance with the CSRA.

Any dispute over the application or interpretation of an

arbitrator’s award, including remanded awards, shall be

returned to the arbitrator for settlement.

Article 25—Health and Safety

Section 25.01: General Policy

The Employer agrees to establish and maintain a com-

prehensive occupational safety and health program, and to

make every effort to provide safe and healthful workplaces

and working conditions as required by applicable regulations.

The Employer and the Union agree to cooperate in a

continuing effort to avoid, reduce the possibility of, and/or

eliminate accidents, injuries, and health hazards in all areas

under the Employer’s control. The Employer agrees to

comply fully with all provisions of Executive Order No.

12196 as implemented within DOD and 29 CFR Part 1960.

57a

Section 25.03: Local Activity Committees

*_* *

The parties recognize that temperature conditions in and

around work areas can have a direct bearing on employees’

comfort, morale, health and safety. In determining the stress

that temperature extremes may place upon an individual

employee, the personal comfort and health of the employee

will be taken into consideration as well as related factors such

as wind chill factor, air flow, the work to be performed, and

similar considerations. Where the Employer’s Bioenviron-

mental Office determines that the effective temperature in a

particular work area or site exceeds recognized standards for

the degree of work being performed, the Employer will take

precautionary measures to reduce the risk to employees

exposed. Such measures will include reduction of work being

performed, increased frequency or duration of rest periods,

etc. This section shall apply to both heat and cold exposure

situations. Protective clothing for such situations wiil be

provided where authorized in accordance with Section 25.05.

Section 25.10: Exposure to Hazardous Conditions

The Employer agrees that methods and operating

procedures will be such that personnel will not be un-

necessarily exposed to occupational safety/health hazards,

except where such exposure is a necessary part of the

employee’s official duties. Employees performing such duties

will be compensated in accordance with Article 26, Hazard

and Environmental Pay, and applicable regulations cited

therein.

Section 25.11: Imminent Danger Situations

When an employee, during the course of performance of

official duties, believes he or she is exposed to a health or

safety hazard which presents an imminent danger which may

cause death, injury, occupational illness, loss of a facility, or

58a

major property damage, said employee shall cease the activity

and immediately contact the nearest available supervisor. The

supervisor shall then make an evaluation of the situation after

discussion with the appropriate safety personnel and decide as

to whether work may proceed. The union will be advised and

specific information provided when requested.

* * * &

Article 26—Hazard and Environmental Pav

Section 26.01: Wage Grade Governing Regulations

In accordance with Federal Law, Government-wide regu-

lation and this Agreement, an environmental differential will

be paid to eligible wage grade employees who are exposed to

hazard or physical hardships.”

? Article 26 was originally written as follows:

Hazard and Environmental Pay

Section 26.01: Wage Grade Governing Regulations

In accordance with FMP Supplement 532-1, Subchapter S8-7c, an

environmental differential will be paid to a wage employee who is

exposed to hazard, physical hardship or a working condition listed

under the categories in Appendix J of this subchapter.

Section 26.02 Recommended Amendments To Regulations

The parties agree that either the Union or the Employer may submit

recommendations for amendments to categories in Appendix J to

the OPM.

Section 26.03: Union Membership on EDP Committee

The Union will be permitted to designate one representative to serve

on any committee which may be established to implement FPM

Supplement 532-1 with respect to environmental pay. All disputes

over the payment of environmental differential pay will be resolved

through the negotiated grievance and arbitration procedure.

Section 26.04: General Schedule Regulations

Pay for irregular duty involving physical hardship or hazard for GS

employees will be paid in accordance with the provisions of the

FPM.

59a

Section 26.02: Union Membership on EDP Committee

* The Union will be permitted to designate one represen-

tative to serve on any committee which may be established

with respect to environmental pay. The representative will

receive hazard material training on a yearly basis. All

disputes over the payment of environmental differential pay

will be resolved through the negotiated grievance and

arbitration procedure.

Section 26.03: General Schedule Regulations

* * * &

show that grievants work environment does not subject

them to levels of asbestos exposure beyond the safe

limits established by OSHA and the Air Force. In

addition, safety measures have been implemented with

Union participation-the A-Team-to further reduce the

exposure hazard. Thus, grievants duty does not involve

them in unusually severe working condition or unusually

severe hazards with a potential for illness or injury. The

safety measures taken are fairly and reasonably

responsive to the needs of hazard abatement which, in

composite, have practically eliminated the potential for

personal illness or injury. This, in turn requires a

determination that the employer has not violated Articles

25 and 26 of the parties Master Labor Agreement by

denying grievants Environmental Differential Pay under

terms and conditions made explicit by the Federal

Personnel Manual.

There is zero doubt that the Agency has consistently

believed that Article 26 should be understood to have adopted

the OSHA PEL as the standard for entitlement to pay

differential. The Agency communicated this position in the

so-called “Givens’ letter” and has never wavered one-inch

therefrom, regardless of the audience, But the Agency

mistakes their determination to have Article 26 mean

60a

something other than what it says; to equal acquiescence, by

the Union, thereto. No credible evidence exists to show that

the Union has ever, from the bargaining table activity of the

first MLA to the time of the filing of this grievance, agreed

that EDP entitlement occurs only in the event of a breach of

the OSHA PEL. To the contrary, the Union (Local 1617 and

the AFGE National Union) has always contended that EDP

should be considered and decided on a case-by-case basis

without any strict reliance upon the OSHA PEL or for that

matter, any other specific level of exposure. While it is true

that the Union has not successfully prosecuted its position,

that does not render its position nugatory. The position of the

Union simply has not carried the day, with previous

grievances and arbitrations being decided against it. This is

fundamentally different, and light years removed from,

acceptance of the Agency’s interpretation. It is not

acceptance. Rather, it is regrettable tolerance.

It is important to observe that there is no language in the

MLA with respect to whether prior arbitration awards should

be considered as conclusive on future disputes regarding the

_ same issue. Rather, the MLA only casually outlines the duties

and responsibilities of the arbitrator in hearing a dispute. It

must be presumed that the parties intended to avoid any strict

rules or they could have easily included language such as:

At the outset of the hearing, either party may submit to

the arbitrator, a copy of a previously decided arbitration

between the parties. If the arbitrator believes that the

previous arbitration addresses the same issue being

presented to him/her, the arbitrator shall summarily issue

judgment consistent with the previous award, without

necessity of a hearing on the merits.

The MLA actually offers no guidance as to how much

weight, if any, that prior arbitration awards should be given.

Absent specific MLA language controlling the question, it

should be presumed that the intent of the parties was to confer

Ninh dabaden balsamic mika oe

6la

upon the arbitrator the duty of determining the proper weight

that should be accorded to previous decisions. The test that

will be employed herein is that the merits of this case will be

decided, de novo, based solely upon the evidence presented to

this Arbitrator. This approach fairly considers prior

grievance/arbitration activity, inasmuch as those prior cases

are a part of the record. They will be given that weight which

the Arbitrator, upon considering ail the evidence, deems

appropriate. While this approach eliminates the perfunctory

task of applying, res judicata, it does permit for an evaluation

of all evidence and maximizes the chances of succeeding in

the ultimate task of reaching the right decision, for the right

reasons.

Upon first review of the various arbitration awards

interpreting Article 26 of the MLA, one notion becomes

glaringly obvious. Prior prosecutions of Article 26 grievances

pales in comparison with the all out assault waged by the

Union in the instant proceeding. While this Arbitrator would

not dare to believe that his wisdom exceeds that of any of the

esteemed arbitrators previously, it is clear that the other

arbitrators did not have in any of their records the wealth of

evidence presented to the undersigned. It is quite possible the

other arbitrators reached the right conclusion based upon the

evidence presented to them. It is similarly possible that one or

more of them would have reached an entirely different

conclusion if confronted with the type and quality of evidence

in this plentiful record.

While it is true, that in the prior arbitrations the AFGE

affiliate bringing the action did complain that there exists no

safe level of asbestos exposure, that position was not polished

with medical and scientific evidence. The best attempt at

such, was a feeble reliance upon a newspaper article citing a

government official on the subject. This Arbitrator would

have been unmoved by such a tactic, relying principally upon

the legal principle of burden of proof. If the union cares no

62a

more for its case, than to try to prove its case through a

hearsay newspaper article, then it deserved the fate of a no

remedy decision. Based upon the limited evidence presented,

it is understandable that prior arbitrators concluded that the

evidence was insufficient to prove that exposure below

the PEL was unsafe or potentially unsafe. The primary

responsibility for the proper and full development of the

record belongs with the parties, not with the presiding

arbitrator. The arbitrator must only reach those conclusions of

fact and law that the record reasonably permits. That does not

automatically mean that the issue was correctly decided.

Rather, it only signifies that the parties received justice in

direct relationship to the manner in which they performed

their responsibility of fully and adequately presenting the

merits of the dispute to the appointed trier of fact.

Based upon an assortment of reasons, some of which have

been mentioned and others will become apparent as this

AWARD continues, the Arbitrator will give prior arbitration

decisions only that weight which is warranted in the opinion

of the Arbitrator. The outcome of this case will be determined

solely by the state of this record and not by summary

reference to a previously decided case. The Arbitrator was

engaged to evaluate the merits of this grievance, and that

shall bé done objectively and thoroughly.

Section 3.07

Conclusion: The Evidence is Insufficient to Establish that

the Parties Agreed to be Bound by the OSHA PEL as the

Standard for EDP.

Most of the Agency’s arguments with respect to the OSHA

PEL are highly relevant to the processing of this case. Some

of the arguments go directly to the question of timeliness, and

whether the Union complied with the time requirements

imposed by the MLA to bring its grievance. They have little,

to no, relevance, however, to the matter of whether the OSHA

63a

PEL was the agreed upon standard of EDP entitlement. By-

definition, in order to reach agreement to use the OSHA PEL,

there must have been mutual consent thereto. As noted

previously, Mulholland never consented to use the OSHA

PEL, and the words of the MLA were crafted with the

apparent intent to incorporate the bargaining objective of the

Union to avoid any definition of “practically eliminated.”

Whether the issue is examined in connection with the

collective bargaining history, or in connection with the course

of dealing between the parties, there is insufficient evidence

to establish that the parties agreed that the OSHA PEL would

serve as the trigger point for EDP.

Accordingly, for all the reasons cited hereinabove, the

Arbitrator finds:

The MLA does NOT prohibit entitlement to Environmental

Differential Pay for asbestos exposure below the OSHA PEL.

PART IV

Threshold Issues Continued

Timeliness and Arbitrability

Section 4.01

Terms of the Contract Relating to Timeliness

Article 6 of the MLA sets forth the applicable requirements

for the timely filing of grievances. Section 6.09b provides:

Section 6.09: UNION OR EMPLOYER GRIEVANCES

AT ACTIVITY LEVEL

* * * *

64a

PART VI

Tying Everything Together—The Standard for Asbestos EDP

under the MLA,

Airborne Concentrations of Asbestos Fibers,

Potential for Injury or Illness,

Protective Measures

Section 6.01

Vastness of the Case

The hearing in this dispute lasted approximately 3 weeks.

The hearing produced thousands of pages of transcript, and

many more thousands of exhibits. Many of the exhibits

spanned hundreds of pages. The total pages of exhibits in

evidence probably exceeded 500,000 pages.

The parties fiercely contested this case, devoting signifi-

cant resources in the prosecution and defense of their

respective positions. It is exceedingly clear that the case is of

enormous importance to the parties. The economic stakes are

enormous as well.

The Arbitrator is well aware of the need to reach the right

conclusions. To order an award of EDP to employee un-

deserving thereof does a major disservice to the taxpayers of

the United States. To deny EDP to employees subjected to

dangerous conditions is equally repugnant to the goal of

equitable treatment. To this end, the Arbitrator has carefully

considered the arguments of the parties and the evidence

received into the record. The task has been a monumental

challenge.

Fortunately, the Arbitrator’s task was made easier due to

the superb presentations by the parties. The parties are to be

commended for their hard work and for their excellent

command of the subject matter. It was an honor to have

served as Arbitrator.

65a

* * * *

into direct contact with ACM were not fitted for respirators.

The Agency had in place directives concerning the use of

respirators, but did not act thereupon because it believed that

any operation at or below the OSHA PEL was risk free. The

notion of the use of protective equipment never was

integrated into operations because of management’s dogmatic

adherence to the belief that the OSHA PEL was a guarantee

of safety.

Section 6.06

The Preponderance of Evidence Establishes Eligibility to

EDP for Kelly AFB Unit Employees

For all the reasons heretofore cited, the Arbitrator finds that

Kelly unit employees were exposed to airborne concen-

trations of asbestos that may have had the potential of causing

asbestos related injury or illness, and protective equipment or

other safety device did not practically eliminate the potential

for such iniury or illness.

PART VII

Mitigation

- Remedy

Section 7.01

Bargaining Unit Employees are Entitled to EDP

The Arbitrator has already concluded that the Union has

shouldered its burden of proof with respect to establishing

eligibility to EDP under the parties’ contract and under

federal regulation. The Arbitrator’s remarks and conclusions

in this PART of the Award should not be viewed as any

retreat from the findings of entitlement to EDP. The remarks

in this PART relate only to the appropriate remedy and to

mitigating circumstances.

66a

Section 7.02

Determining an Appropriate Remedy—Factors of Mitigation

The Arbitrator has already made glancing reference to the

fact that each party presented extreme positions in forging

their positions. The Agency’s position that entitlement should

not be triggered, unless or until the Agency violates the law,

seems as unreasonable as the Union’s position that any

exposure activates entitlement. But the parties’ rigidity of

positions is not totally their fault. The manner in which the

EDP case law has evolved almost guarantees that parties must

take such extreme positions.

For reasons never made clear to the Arbitrator, the function

for determining entitlement to EDP, for wage-grade

bargaining unit employees, has been declared to be a “local”

issue. This means that arbitrators decide entitlement on a

case-by-case basis. Such a methodology compels inconsistent

findings of entitlement and inconsistent interpretation of the

EDP regulation. Such an approach inescapably leads to

situations where one group of federal wage-grade employees

is compensated for asbestos exposure and another group,

under almost identical conditions, is denied such payment.

How public policy is advanced by this vacillating approach is

unknown to the Arbitrator. It would seem, at least to the

Arbitrator, that the regulatory language should have the same

meaning and value regardless of the location of the work. The

language has not

* * * *

the Agency may apply for a special exception to the

general remedy, hereinafter entered. The Agency shall have

the burden of establishing that employees worked in ACM

free buildings. The Arbitrator will then issue a supplemental

AWARD and ORDER in connection therewith.®°

®° Shortly before the issuance of this AWARD, and many months after

the close of the record, the Agency wrote the Arbitrator concerning

67a

PART VIII

Findings

1. The Arbitra

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