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Federal Education Association v. Federal Labor Relations Authority

United States Court of Appeals, District of Columbia Circuit

June 21, 2019

Federal Education Association, Petitioner
Federal Labor Relations Authority, Respondent

          Argued January 30, 2019

          On Petition for Review of an Order of the Federal Labor Relations Authority

          William Howell Freeman, Jr. argued the cause and filed the brief for petitioner.

          Rebecca J. Osborne, Attorney, Federal Labor Relations Authority, argued the cause for respondent. With her on the brief were Fred B. Jacob, Solicitor, and Tabitha G. Macko, Attorney.

          Before: Garland, Chief Judge, and Pillard and Wilkins, Circuit Judges.



         Pillard, Circuit Judge: The Department of Defense, acting through the Department of Defense Education Activity ("the Agency"), provides schools for the children of service members stationed abroad. Roughly 4, 000 of the 15, 000 teachers that the Agency employs around the world are represented by the Federal Education Association ("the Union"). In the early 2000s, the Union and the Agency began to arbitrate a compensation dispute. After years of arbitration and multiple decisions by the arbitrator, the Union in October 2015 filed an unfair labor practice charge with the Federal Labor Relations Authority ("the Authority") challenging the Agency's failure to comply with the arbitral awards. The Union petitions us to reverse the Authority's decision that its unfair labor practice charge was untimely, and asks us to retain jurisdiction to ensure that the government complies with the arbitration awards. For the reasons discussed below, we conclude that the charge was timely and therefore grant the Union's petition for review in part. We deny the petition insofar as it asks us to retain jurisdiction. It is up to the Authority to consider in the first instance the Agency's exceptions to the administrative law judge's holding that the Agency had committed an unfair labor practice.


         In the early 2000s, the Union came to believe that the Agency was underpaying some of its teachers and failing to provide them with consistent and comprehensible payroll information to enable them to monitor and understand their salary payments. The Union filed a class grievance on the teachers' behalf in 2002, alleging the Agency had "engaged in a persistent pattern of failing to pay or to apprise bargaining unit employees of" the amounts the Agency owed them. Supp. App'x ("S.A.") 3. The Union identified, by way of example, eight underpaid teachers in Germany. Pursuant to the parties' collective bargaining agreement, the Union sought arbitration in Germany under the auspices of the Federal Mediation and Conciliation Service, an independent agency that maintains a roster of arbitrators who handle labor-management disputes.

         Over the next thirteen years, the arbitrator issued four decisions, or "awards." The arbitrator conducted two days of hearings in December 2002. He issued an initial pair of awards in November 2003. In the first award, the arbitrator concluded that the Agency had violated its collective bargaining agreement with the Union, as well as federal law and prior arbitration decisions binding the Agency and Union. He found that the employees at issue "did not receive all of the appropriate payments, back pay and interest to which they were entitled" or, in the alternative, at least "did not receive an adequate explanation of benefits or payments received." S.A. 13 (Nov. 7, 2003 Award). "[E]mployees [were] routinely provided with payments without meaningful explanation of how the payments were derived." S.A. 18. He saw no grounds for the shortfalls where "[n]o technological or other impediment ha[d] been demonstrated that justifie[d] the Agency's failure to provide every bargaining unit employee with a clearly articulated written explanation of what every payment represents, including the basis for computation." S.A. 19. The arbitrator therefore ordered the Agency to submit within sixty days a "proposal for implementing a revised computer program to provide with sufficient specificity the information set forth in" the award. S.A. 45.

         The second of the initial pair of awards ordered the Agency, or the Defense Finance and Accounting Service ("DFAS") (a separate Department of Defense component that administers the Agency's-and other agencies'-online payroll system), "or some other entity of the Department of Defense" to "create or modify its computer programs or other procedures by which bargaining unit employees are paid so that all bargaining unit employees receive with every payment a clear, fully understandable explanation of what is included." S.A. 51 (Nov. 12, 2003, Award). The arbitrator stated that the system must include,

[f]or example, the nature of the payment, the period represented by the payment, the date of the document submitted for payment, the actual exchange rate of foreign currency upon which the payment was predicated, and the number of units (for example, days or hours) times the applicable rate, whether interest is included, the period covered by the interest, the rate of interest, and the arithmetic computing the interest.

S.A. 51-52. The award specified that "such compliance shall be achieved . . . within a reasonable interval," and that "[f]ailure to comply with this directive within ninety days of this Award [might] result in the imposition of substantial liquidated [damages]." S.A. 52.

         The Agency filed exceptions with the Authority. According to the Agency, only the Department of Defense's Chief Financial Officer had the "authority to make the changes" that the arbitrator had ordered; all the Agency itself could do was ask him to make those changes. U.S. Dep't of Def. Educ. Activity, 60 F.L.R.A. 24, 25 (2004). The Authority denied the exceptions, concluding that the Agency had not established that satisfying the awards was beyond its power. The awards became final and the Agency began taking steps to comply. In the process, the parties participated in "implementation hearings" ...

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