[ v21 p131 ]
21:0131(25)AR
The decision of the Authority follows:
21 FLRA No. 25
NAVAL AIR DEVELOPMENT CENTER,
DEPARTMENT OF THE NAVY
Agency
and
AMERICAN FEDERATION OF GOVERNMENT
EMPLOYEES, LOCAL 1928, AFL-CIO
Union
Case No. 0-AR-897
DECISION
This matter is before the Authority on an exception to the award, as
clarified, of Arbitrator Peter Florey filed by the Department of the
Navy (the Agency) under section 7122(a) of the Federal Service
Labor-Management Relations Statute and part 2425 of the Authority's
Rules and Regulations.
Based on the separate concurring opinions below, the Agency's
exception to the Arbitrator's award, as clarified, is denied and the
award of attorney fees is modified by striking from the amount awarded
all compensation for photocopying expenses.
Issued, Washington, D.C. March 25, 1986
Jerry L. Calhoun, Chairman
Henry B. Frazier III Member
FEDERATION LABOR RELATIONS
AUTHORITY
OPINION OF CHAIRMAN CALHOUN:
I. STATEMENT OF THE CASE
This case presents the question of the propriety of the Arbitrator's
award of attorney fees pursuant to the Back Pay Act (5 U.S.C. 5596) and
requires an articulation of the standards arbitrators should apply in
rendering a decision to grant or deny attorney fees and in determining
the amount of fees to be granted where warranted.
II. BACKGROUND AND ARBITRATOR'S AWARD
The grievance at issue concerned entitlement to environmental
differential pay and involved questions of health and safety related to
asbestos exposure. The Arbitrator issued his original Opinion and Award
in the underlying matter on July 1, 1982. He found the grievance
arbitrable; compliance with the Agency's regulation concerning asbestos
hazards "generally satisfactory ... but not uniformly implemented," and
returned the case to the parties for computation of backpay. In a
Supplemental Award dated March 15, 1983, Arbitrator selected a
computation of backpay favorable to the Union's position and approved
the Union counsel's submission requesting payment of his attorney fees.
The Agency timely filed an exception contesting only the award of
attorney fees. In reviewing that exception, the Authority concluded in
14 FLRA 782 (1984) that remand was appropriate and ordered:
The award is remanded to the parties with the direction that they
request, jointly or separately, that the Arbitrator clarify award.
The submission to the Arbitrator for the limited purpose of
having the Arbitrator clarify and interpret his award of attorney
fees to articulate fully specific findings on all pertinent
statutory provisions.
This short remand decision cited the Authority's decision in
International Brotherhood of Electrical Workers and United States Army
Support Command, Hawaii, 14 FLRA 680 (1984). In that case the Authority
ruled that an award of attorney fees under the Back Pay Act, 5 U.S.C.
5596 (see Appendix), must be made in accordance with the standards
established under 5 U.S.C. 7701(9)." The Authority cited with approval
existing decisional Precedent of the U.S. Merit Systems Protection Board
(MSPB) /1/ and held that in ruling on an attorney fee request, the
arbitrator must issue a "fully articulated, reasoned decision setting
forth the sPecific findings supporting the determination." Id. at 684.
In his clarification, the Arbitrator in the present case found that
"(a)ttorney fees are payable in this case under the Back Pay Act (5
U.S.C. 5596) and the Civil Service Reform Act (5 U.S.C. 7701(g))- and
that the amount of attorney fees was "reasonable." In support of these
findings, the Arbitrator noted that the Union's grievance concerning
entitlement to an environmental pay differential for exposure to
asbestos involved the health and safety of a number of employees; was
of the highest priority; and was sincerely pursued by the Union with
considerable justification. He affirmatively found that the Activity
knew of asbestos exposure exceeding the standards of the National
Institute of Occupational Safety and Health and that such knowledge
required "greater attention" by Agency officials. The Arbitrator
concluded that the matter involved a continuing struggle for safety in
the workplace under conditions endangering the health of emPloyees and
constituted a situation warranting an award of attorney fees "in the
interest of justice." /2/
III. POSITIONS OF THE PARTIES
The Agency contends that the award of attorney fees is deficient as
contrary to the Back Pay Act, as amended. Specifically, it maintains
that the award is not in accordance with the governing standards
established under section 7701(g) because the Arbitrator failed to
provide a fully articulated, reasoned decision setting forth the
specific findings supporting the determination of each partient
statutory requirement, including the basis on which the reasonableness
of the amount was determined.
In its opposition to the Agency's exception, the Union argues that
the award of attorney fees is warranted "in interest of justice" because
of the complex health and safety issues involved; that the Activity's
unwillingness to grant any portion of the remedy resulted in the
expensive arbitration proceeding; and that considerations of the
Union's duty of fair representation and lack of resources warrant the
award of fees. The Union further maintains that the circumstances of
this case support the award of attorney fees under the standards
identified by the Merit Systems Protection Board (MSPB) in Allen v. U.S.
Postal Service, 2 MSPB 582 (1980).
IV. ANALYSIS AND CONCLUSIONS
A. Relevant Precedents and Statutory Provisions
In its earlier decisions, the Authority determined that a review of
an arbitrator's award of fees must be within its original subject matter
jurisdiction /3/ and that the arbitrator must possess the statutory
authority to award attorney fees. /4/ Attorney fees may be awarded by
arbitrators in a variety of unjustified and unwarranted personnel
actions, including, but not limited to, actions subject to the
negotiated grievance procedure or relating to an unfair labor practice.
/5/ In addition, the broad category of personnel actions covered by the
Back Pay Act includes the omission or failure to take an action or
confer a benefit. /6/
Further, as set forth in Army Support Command Hawaii the Back Pay Act
required that the award of fees be in conjunction with ;an award of
backpay to the grievant on correction of the unwarranted personnel
action /7/ that the award of fees must be reasonable and related to the
personnel action, and that the award of attorney fees must be in
accordance with the standards established under section 7701(g).
Subsection (1) of section 7701(9), which applies to all cases except
those involving complaints of discrimination nation, /8/ requires that
the employee must be the prevailing party, that the fees must been
incurred by the employee, that the award of attorney fees must be
warranted "in the interest of justice," and that the amount must be
reasonable.
While the MSPB has had numerous cases in which to address fee awards
for attorneys under the applicable provisions of 5 U.S.C. 7701(9), to
date there has been a paucity of opportunities for the Authority to
review appeals of arbitration awards contesting attorney fee findings.
The jurisdiction of arbitrators (as well as other "appropriate
authorities") under the Back Pay Act, however, extends to a
significantly wider range of matters than those within the jurisdiction
of the MSPB. As in the instant case, many questions heard by
arbitrators involve situations where an employee or group of employees
affirmatively initiate the grievance procedure to seek a benefit
allegedly improperly withheld by management. /9/
Because of the experience of the MSPB in this area and the many
similarities between the two agencies with respect to the types of
matters that come before they, the Authority has in the past reviewed
MSPB attorney fee standards and, where applicable, has adopted MSPB
rationale This inclination by the Authority to cite Board precedents
should not, however, in my judgment, he interpreted by parties to future
proceedings as an absolute adoption by the Authority of MSPB case law.
Likewise, I would not limit or restrict the Authority or arbitrators to
awarding attorney fees only in those cases that are analogous to MSPB
appeals.
In this opinion, it is my intent to provide further guidance to
advocates and arbitrators with regard to the standards to be considered
in making attorney fee determinations under 5 U.S.C. 5596 and 5 U.S.C.
7701(g)(1)
B. The Analytical Framework
As stated above, five distinct requirements must be met for an
arbitrator's award of attorney fees to be supportable under the
provisions of section 7701(9)(1):
1. Fees must be incurred for the services of an attorney.
2. Fees may be sought only by the prevailing party.
3. The award of fees must be warranted "in the interest of justice."
4. The amount claimed for attorney fees must be reasonable.
5. The award of fees must be set out in a fully articulated, reasoned
decision.
A detailed analysis of each of these requirements follows.
1. Incurrence of Attorney Fees: An attorney client relationship must
exist and the attorney must have rendered legal services on behalf of
the appellant. O'Donnell v. Department of Interior, 2 MSPB 604 (1980).
2. Prevailing Party: An appellant is the prevailing party for the
purposes of a fee award if he or she has obtained all or a significant
part of the relief sought. Sterner v. Department of the Army, 711 F2d
1563, 1566-67 (Fed. Cir. 1983). The party need not prevail on all
issues; rather, it is sufficient to prevail on a significant, separable
claim on the merits. Hanrahan v. Hampton, 466 U.S. 754 (1980); Bradley
v. Richmond School Board, 416 U.S. 696 (1974). In reviewing a request
for attorney fees one should look to the "substance of the litigation"
to determine whether a party has substantially prevailed in its
position, and not merely to the "technical disposition of the case or
motion." Devine v. Sutermeister, 733 F.2d 892 (Fed. Cir. 1984).
3. Interests of Justice: The MSPB in Allen held that the interest of
justice standard includes, but is not limited to, cases involving
prohibited personnel practices, agency actions clearly without merit,
agency actions taken in and faith to harass or exert improper pressure
on an employee, agency gross procedural error which prolonged the
proceeding or severely prejudiced the employee, and cases where the
agency knew or should have known it would not prevail on the merits when
it brought the proceeding. I believe that in defining and applying the
parameters of "interest of justice" standard, arbitrators should
consider these factors as further clarified and augmented below. This
compilation of factors, however, is not intended to be all-inclusive;
rather, additional considerations should applied where relevant and
appropriate to individual cases and arbitrator; are to be guided by
both equity and logic. Illustrative examples gleaned from MSPB and
court cases are as follows:
a. Instances where the agency presents little or no evidence to
support its actions or demonstrates either a lack of or negligent
preparation of the case. /10/ This includes instances where the
agency's action lacks substantial justification or is totally unfounded
and clearly without merit. For example, a situation where the agency's
careful reading of the relevant statutes and regulations would have
promptly shown that its interpretation was erroneous.
b. Instances where agency ill will, or negligence, tainted the action
against the employee to an unconscionable degree. This may be inferred
from agency action or inaction throughout the proceedings. /11/
c. Instances where the agency initiated action against an employer in
disregard of Prevailing law,. regulations, or negotiated agreement
provisions on federal policy. Examples include actions based on
improper denial of overtime, environmental differential pay, shift
differentials, hazardous duty pay, annual leave, administrative leave,
or official time for representational functions.
d. Instances where the employer is ultimately found to be
substantially innocent of the charges brought by the agency. This
determination is made on the basis of result of the appeal rather than
on the evidence and information available to the agency at the time the
agency effected the action. /12/ This standard is not met, however,
where the employee believes that he or she is substantially innocent,
can prove his or her innocence, and deliberately does not communicate
all of the facts to the agency deciding official where the employee's
disclosure would reasonably have caused the agency official to modify or
overturn the action. Such an employee deliberately and improperly
prolongs the agency's legal proceedings and cannot be regarded as an
innocent victim who is entitled to attorney fees in the interest of
justice. /13/
e. Instances where the agency fails to inquire into facts presented
by the employee or fails to conduct a prudent inquiry into the
employee's contradictory evidence. /14/ For example, had an agency
inquired into the facts presented by the employee, the agency would or
should have ascertained at the outset that the charges against the
employee were without merit or that the grievance should have been
sustained.
f. Instances where there is either a service rendered to the federal
work force or there is a benefit to the public derived from maintaining
the action. /15/ For example, situations where an employee's grievance
leads to correction of workplace problems affecting a segment of the
workforce, as in the instant case.
4. Reasonableness of the fee: The reasonableness of the fee is to be
considered after entitlement has been established. /16/ In calculating
what consitutes a reasonable fee, courts have applied a variety of
methods and multifactor analyses. An example of a method of computation
acceptable to administrative adjudicatory bodies and most courts is the
"lodestar" concept, wherein the attorney's customary hourly billing rate
is multiplied by the number of hours reasonably devoted to the case.
Careful review of the hourly rate and the number of hours claimed to
have been expended is required prior to computing the lodestar. See
Mitchell v. Department of Health and Human Services, 19 MSPR 206 (1984).
Reduction of the hourly rate or the number of hours must, however, be
justified by detailed findings. See Crumbaker v. MSPB, No. 85-1982
(Fed. Cir. Jan. 28, 1986), slip op. at 3-9.
The lodestar figure becomes the starting point for the setting of the
fee and may be adjusted upward or downward for factors including, but
not limited to, contingency the arrangements where there was a risk of
nonpayment or partial payment, extreme difficulty of the case, and
extensive expertise of counsel which is not reflected in the hourly
rate. The burden of justifying any adjustment to the lodestar figure
falls on the party proposing the charge. Copeland v. Marshall, 641 F.2D
800 (D.C. Cir. 1980); Lindy. Bros. Builders, Inc. v. American Radiator
and Standard Sanitary Corp., 540 F.2d 102 (3d Cir. 1976); Mitchell, 19
MSPR 206. An award of attorney fees should not, however, be reduced
simply because a party failed to prevail on every contention raised.
See Hensley v. Eckerhart, 461 U.S. 424 (1983); Boese v. Department of
the Air Force, No. 85-2357 (Fed. Cir. February 19, 1986, slip op. at 7.
The computation of reasonable attorney fees differs where the award
will ultimately be received by a union rather than a law firm. In such
cases, the fee must computed based upon actual expenses rather than the
market value of the services rendered. Further, a legal fund created by
the union for fees does not alter the limitation to actual expenses for
union attorneys. Goodrich v. Department of the Navy, 733 F.2D 1578
(Fed. Cir. 1984), Cert. denied 105 S. Ct. 958 (1985); NTEU v.
Department of Treasury, 656 F.2d 848 (D.C. Cir. 1981).
5. Fully articulated, reasoned decision for fees: In the application
of the standards set out under 5 U.S.C. 5596 and 5 U.S.C. 7701(g), the
Arbitrator is to provide a fully articulated, reasoned decision granting
or denying the request for attorney fees. Army Support Command, Hawaii,
at 684. The decision must contain independent and specific analysis,
findings, and conclusions on each pertinent statutory requirement
including the reasonableness of the amount of fees when fees are
awarded.
An arbitrator's reference to one party's brief as support for a
finding of attorney fees, or a cursory statement that the arbitrator
considered the necessary elements of analysis does not meet this test.
Rather, such defects create an analytical void which serves to confuse
the parties, the public and the reviewing bodies. As an arbitrator's
award must draw its essence from the parties' collective bargaining
agreement, /17/ so too must an arbitrator's award of attorney fees draw
its essence from a demonstrable, pragmatic analysis of the factors set
out in the applicable statutes. /18/
V. THE ANALYTIC FRAMEWORK APPLIED TO THIS CASE
Having clarified the analytic framework I believe should be applied
in attorney fee cases under the Back Pay Act, the question to be
addressed is whether the award of attorney fees in the instant case is
consistent with the requirements of the Back Pay Act. Based upon the
following analysis, I conclude as follows:
1. Incurrence of Fees: The record shows that an obligation to pay
attorney fees was incurred by the Union on the employees' behalf.
2. Prevailing Party: There is no dispute that the employees in this
case were prevailing parties.
3. Interest of Justice: A careful review of the initial decision by
Arbitrator Florey establishing right; and remedies under the collective
bargaining agreement, and his subsequent Report to the Authority,
supports a finding that the award of attorney fees is in the "interest
of justice." The Arbitrator specifically found that "in an installation
striving for zero asbestos exposure, forty full days each year of
exposure exceeding NIOSH standards (in case of pipefitters) reflected
hazardous conditions requiring greater attention" on the part of the
Agency. Further, he noted the "complexity and magnitude" of the case
and the "feigned cooperation" of the Agency. He specifically noted that
the asbestos problem is clear cut and thoroughly documented and presents
a continuing struggle for safety in the workplace"; and that the
"health and safety of the employees ... was pursued by the Union ... as
reflected in the decision, with considerable justification." Finally,
the Arbitrator concluded that "the case presented by Union in the
present proceedings, particularly the evidence of pipefitters and other
craftsmen, contained ... elements damning justifiably the professed
sincerity, competence and good faith of operating supervisors below the
Command Level" /19/ These statements by the Arbitrator are construed to
be tantamount to a finding that the Agency should have known of the
hazard and should have taken affirmative action to remedy the hazard.
It is further concluded that the record supports findings that the
magnitude of the injustice done to the employees in exposing them to
asbestos and the public benefit derived from maintaining the action are
substantial.
d. Reasonableness of the Amount of the Award:
The hourly billing rate of $65 requested by the Union's attorney is
well within the range routinely approved by MSPB and the courts and is
not challenged by the Agency. It is less than the rather conservative
rate allowed under the, Equal Access to Justice Act, 5 U.S.C. 504. The
detailed time records submitted to the Arbitrator conform to the
requirements of MSPB decisions and established practice in personnel
Cases. See, e.g., Mitchell, 19 MSPR 206. One necessary adjustment must
be made, however, Counsel's fee statement includes photocopying
expenses. MSPB and the courts no longer permit photocopying expenses to
be awarded as attorney fees under section 7701(g)(1). Bennett v.
Department of the Navy, 699 F.2d 1140, 1144 (Fed. Cir. 1983);. Koch v.
Department of Commerce, MSPB Docket No. 0C03518110733ADD (Jan. 25,
1984).
5. Fully articulated, reasoned decision: The Arbitrator's
clarification was rendered pursuant to Authority's order that he
-articulate fully specific findings on all pertinent statutory
provisions." The Arbitrator's decision primarily incorporates by
reference the arguments of the Union and does not meet the requirement
for a fully articulated and reasoned decision containing independent
analysis, findings and conclusions. Because of the extended proceedings
in this matter and because the record adequately permits resolution of
the Agency's exception, the decision in this case is not to remand for
further proceedings. This decision, however, in no manner sanctions the
practice of incorporation of a party's arguments by reference as a means
of setting forth the specific findings supporting the determination of
attorney fees as required by 5 U.S.C. 5596 and 5 U.S.C. 7701(g).
Jerry L. Calhoun, Chairman
FEDERAL LABOR RELATIONS AUTHORITY
MEMBER FRAZIER CONCURRING:
I concur in the Chairman's decision that the arbitrator's award of
attorney fees herein meets the basic statutory requirements under the
Back Pay Act /20/ and I agree with his conclusion that the amount of
fees must be modified for the reasons he gives.
However, I feel that it is incumbent upon me to explain the manner in
which I reached my conclusion that the arbitrator's award of attorney
fees in this case meets the requirement for a "fully articulated,
reasoned decision" setting forth the specific findings supporting the
determination on each pertinent statutory requirement for an award of
attorney fees and hence is not deficient in this regard. Further, I
believe it is necessary to explicate the manner in which I have reached
my conclusion that the arbitrator's award establishes that an award of
attorney fees in this case is "warranted in the interest of justice" and
hence is not deficient in this regard.
I. BACKGROUND AND SUMMARY OF THE ARBITRATION AWARD
The arbitrator, in his initial opinion and award in this case, stated
that the grievance was filed on behalf of pipefitters who were alleged
to be "assigned duties which expose them to a Category 16 hazard as set
forth in Appendix "J' of the FPM Supplement 532-1, i.e., Asbestos Dust
and Article XVIII, Section "G' of the Negotiated Agreement. ..."
Management had denied the requested 8% payment because, as stated by the
arbitrator in his initial opinion and award, "(m)anagement was providing
protective equipment and that, in Management's opinion, the protective
equipment was practically eliminating the potential for personal illness
and injury." The reference to the elimination of the potential for
personal illness and injury was a reference to the provisions of FPM
Supplement 532-1, Appendix J, which provides for a differential pay rate
of 8% to employees "(w)orking in an area where airborne concentrations
of asbestos fibers may expose employees to potential illness or injury
and protective devices or safety measures have not practically
eliminated the potential for such personal illness or injury."
The arbitrator went on to say in his initial opinion and award, that:
... the parties have incorporated Navy regulations into their
negotiated agreement with respect to the payment of Appendix J
hazard allowances, and OPNAVINST 6260 deals specifically with the
control of asbestos exposure. The wording of the contract does
not permit an inquiry into the reasonableness of the regulation in
the grievance procedure, but the Center's compliance with the
regulation is at issue and determines its liability for payment of
the asbestos allowance.
Award at 9. The arbitrator further stated:
(T)he question of the concentration of asbestos which exposes
employees to potential illness has been pre-empted by Naval
regulations which the parties have incorporated in their
negotiated agreement. The Center itself has stated without
reservation that it will apply safety procedures to asbestos
levels below the limits set by OSHA: "Realizing that working with
asbestos may be hazardous, Ref (b) (unspecified document) was
written which promulgated specific procedures and equipment
requirements when employees worked with asbestos exposures equal
to or greater than two fibers per cubic centimeter. NADC has gone
a step further in requiring these safety precautions to be taken
whenever working with asbestos no matter what the airborne
concentration of asbestos and these procedures are in strict
compliance with Ref (b) and all equipment utilized conforms to
NIOSH standards." ... (T)he issue in this case narrows to the
question of the safety precautions taken by the Center to avoid
exposure to asbestos.
Award at 15-16. (Emphasis added.)
The arbitrator found that "(t)o protect the health of its employees
effectively against the asbestos hazard, all the procedures mandated by
OPNAVINST 6260 have to be followed." (Emphasis in original.) He also
found that:
(i)n theory, the Center has set up an admirable procedure for the
protection of its employees against the asbestos hazard following
the directive of OPNAVINST 6260. ... However, the affected
employees related at the hearing that, in practice, they
encountered considerable difficulties and shortcomings such as
poorly fitting respirators, ripping suits and considerable
deficiency in the instructional programs.
Award at 16. The arbitrator found that "(t)his state of affairs is
reflected in the NIOSH report" which he attached to his opinion and
award. The arbitrator found that this report had "labeled several
practical protective measures, including the wearing of respirators, as
"not at all satisfactory." He "stressed that providing protective gear,
in and by itself, does not constitute a complete safety measure within
the meaning of Article (sic) J." Award at 15. The arbitrator concluded
that:
... it can be reasonably expected that the parties themselves will
work out the type of practical implementation of OPNAVINST 6260.1B
which will eliminate the asbestos hazard within reasonable limits
and, thereby, the need to pay the hazard differential. It should
be noted that institution of an effective asbestos control program
was treated as the terminal point of back pay in most of the cited
arbitration decisions.
Award at 17. The arbitrator then made the following award: that the
Center's program for coping with asbestos hazards was generally in
satisfactory compliance with OPNAVINST 5260 but not uniformly
implemented as a practical matter; that the case was returned to the
parties for further proceedings in the light of the arbitrator's
decision and for the computation of backpay; and that payment of the
Union attorney fees by the Center would be triggered by retroactive
payments made under the award. With respect to the award of attorney
fees, the arbitrator noted that the grievance:
. . . was pursued by the Union sincerely and, as reflected in the
decision, with considerable justification. Preparation for a case
of this complexity and magnitude requires considerable time and
reflection, and the situation is clearly one to which the enabling
legislation is addressed by awarding attorney's fees as "warranted
by the interests of justice," as long as back pay becomes payable.
Award at 8.
The parties were unable to reach agreement on how to implement the
initial award, and the matter was referred once more to the arbitrator.
Thereafter, the arbitrator issued a Supplemental Award. In this
Supplemental Award, the arbitrator made the following findings and
award:
After careful review, it appears that the positions of the parties
are not far apart, but that the approach taken the Union comes
closer to effectuating the findings of the July 1, 1982 award than
the proposal by the Center. For this reason, backpay shall be
computed and paid as outlined in the Union's letter of December
15, 1982, and counsel fees should be adjusted accordingly.
Supplemental Award at 1.
Thereafter, pursuant to section 7122(a) of the Federal Service
Labor-Management Relations Statute (the Statute) and part 2425 of the
Authority's Rules and Regulations, the Agency filed an exception to the
award of the arbitrator with the Authority. Specifically, the Agency
excepted to the award of attorney fees, arguing that the award of
attorney fees was contrary to the provisions of the Back Pay Act, 5
U.S.C. 5596, and the standards established under 5 U.S.C. 7701(g) which
govern the award of attorney fees under the Back Pay Act.
The Authority, in Naval Air Development Center, Department of the
Navy and American Federation of Government Employees, Local 1928,
AFL-CIO, 14 FLRA 782 (1984), concluded that the arbitrators award of
attorney fees in this case was not in accordance with the applicable
standards and statutory requirements of the Back Pay Act and remanded
the case to the parties. The remand included direction that the
parties, jointly or separately, request the arbitrator to clarify and
interpret his award of attorney fees so as to articulate fully specific
findings on all pertinent statutory provisions. The Authority decided
to remand the case because, as the Authority then pointed out, the award
of attorney fees herein was issued on a date prior to the issuance by
the Authority of its decision in International Brotherhood of Electrical
Workers and United States Army Support Command, Hawaii, 14 FLRA 68O
(1984) and hence, the Arbitrator's determination was made without the
benefit of the instruction and guidance provided by United States Army
Support Command, Hawaii."
In Army Support Command, Hawaii, the Authority for the first time,
had addressed in detail the statutory requirements regarding awards of
attorney fees. In that case, the Authority said, in pertinent part:
As previously recognized by the Authority, a threshold requirement
for entitlement to attorney fees under the Back Pay Act is a
finding that the grievant had been affected by an unjustified or
unwarranted personnel action which has resulted in the withdrawal
or reduction of the grievant's pay, allowances, or differentials.
Department of Defense Dependents Schools and Overseas Education
Association, 3 FLRA 259, 263 (1980). Further, a reading of the
Back Pay Act indicates that an award of attorney fees must be in
conjunction with an award of backpay to the grievant of correction
of the personnel action, that the award of attorney fees must be
reasonable and related to the personnel action, and that the award
of attorney fees must be in accordance with the standards
established under 5 U.S.C. 7701(g). Section 7701(g) prescribes
that for an employee to be eligible for an award of attorney fees,
the employee must be the prevailing party. Section 7701(g)(1)
which applies to all cases except those of discrimination,
requires that an award of attorney fees must be warranted "in the
interest of justice," that the amount must be reasonable, and that
the fees must have been incurred by the employee. ... The
standards established under section 7701(g) further require a
fully articulated, reasoned decision setting forth the specific
findings supporting the determination on each pertinent statutory
requirement, including the basis upon which the reasonableness of
the amount was determined when fees are awarded. See, e.g., Allen
v. U.S. Postal Service, 2 MSPB 582 (1980); Kling v. Department of
Justice, 2 MSPB 620 (1980); see also 5 CFR 550.806 (1983).
Therefore, to summarize, because in this case the award was issued on
a date prior to the issuance of Army Support Command, Hawaii, and thus
without the benefit of the instruction and guidance provided by Army
Support Command, Hawaii, it determined to remand for the purpose of
allowing the arbitrator to clarify and interpret his award in the light
of the standards articulated by the Authority therein. /21/ In the
remand the attention of the parties and the arbitrator was directed to
the guidance in Army Support Command, Hawaii, by a specific citation to
the case.
Thereafter, the arbitrator issued a clarification and interpretation
of his award of attorney fees, stating that such "fees are payable in
this case under the Back Pay Act, 5 U.S.C. Para. 5595, and the Civil
Service Reform Act, 5 U.S.C. Para. 7701(g) as fully explained in the
Union's brief which is incorporated into this decision" and that the
attorney fees being sought "are reasonable and shall be paid forthwith."
In this clarification and interpretation of his award of attorney fees
the arbitrator found that "(a)ny reasonable person would agree that even
one dollar of 8% Hazardous Duty Payment for asbestos exposure cries out
for Attorney Fees in the interest of justice. ..." Clarification at 5.
In reaching this conclusion, in his clarification and interpretation,
the arbitrator noted, inter alia:
Initially, I was not prepared to defend or explain my prior
decision in this case. The Union has done it brilliantly and
extensively in its brief which I am incorporating into this Report
as a part thereof. As (the Union's counsel's) brief points out,
there is not a single standard for the payment of Attorney Fees
that is not reflected in my decisions.
Clarification at 4-5. The arbitrator went on to say that:
(t)he case presented by the Union in the present proceedings,
particularly the evidence of pipefitters and other craftsmen,
contained ... elements damning justifiably the professed
sincerity, competence and good faith of operating supervisors
below the Command Level. ... It (the Agency) knew that, in an
installation striving fur zero asbestos exposure, forty full days
each year of exposure exceeding NIOSH standards (in the case of
pipefitters) reflected hazardous conditions requiring greater
attention. ... The asbestos problem is clear cut and thoroughly
documented and presents a continuing struggle for safety in the
work place.
Clarification at 6-7.
The arbitrator found that the policies of top management were not
followed diligently by subordinate supervisors, loading to unwarranted
exposure to asbestos hazards on the part of the employees involved in
the arbitration. As noted above, the arbitrator incorporated the brief
filed by the Union counsel into his report of clarification and
interpretation, adopting that analysis as his own. The arbitrator
affirmed the award of attorney fees.
The Agency has filed an exception to the arbitrator's award as
interpreted and clarified. The Agency, in essence, again contends that
the award of attorney fees is contrary to the Back Pay Act, 5 U.S.C. 2
5596, and more specifically that it is not made in accordance with the
standards established under 5 U.S.C. 7701(g). In the latter regard the
Agency contends that the arbitrator did not provide a fully articulated,
reasoned decision setting forth specific findings that support the
determination to award attorney fees. Accordingly, the issue presented
to the Authority by the exceptions filed by the Agency is whether or not
the award of attorney fees by the arbitrator is contrary to law.
II. ATTORNEY FEES UNDER THE CIVIL SERVICE REFORM ACT
Under the "American Rule," attorney fees are not ordinarily
recoverable by the prevailing litigant in federal litigation Order
Granting Request for Reconsideration in that case because the arbitrator
and the parties were not explicitly apprised that the Authority would
set aside an award of attorney fees that was not fully supported as
required. In that Order parties and arbitrators were put on explicit
notice that deficient awards of attorney fees issued hereafter will be
set aside (or modified as appropriate) rather than being remanded absent
statutory authorization to award such fees. Alaska pipeline Service Co.
v. Wilderness Society, 421 U.S. 240, 247 (1975). Moreover, an award of
attorney fees against an agency of the United States Government is not
permitted unless there, is an explicit statutory provision authorizing
such an award which may serve as a waiver of traditional sovereign
immunity enjoyed by the United States. Scarborough v. Office of
Personnel Management, 723 F.2d 801, 808 (11th Cir. 1984); Spencer v.
NLRB, 712 f.2d 539, 543-44 (D.C. Cir. 1983). Accordingly, a careful
review of an award of attorney fees against the United States is
necessary to assure that it is made within the explicit terms of the
statute which authorizes such award.
The Back Pay Act authorizes an appropriate authority such as the
Federal Labor Relations Authority or an arbitrator to award attorney
fees to an employee under certain specific circumstances. /22/
Specifically, the Act requires that in order to be eligible for attorney
fees, the employee must found by appropriate authority under applicable
law, rule, regulation or collective bargaining agreement, to have been
affected by an unjustified or unwarranted personnel action which
resulted in the withdrawal or reduction of the employee's pay,
allowances, or differentials. Additionally, the fee award must be in
conjunction with an award of backpay of the correction of the
unjustified or unwarranted personnel action; the fee award must be
reasonable and related to the personnel action; and, the fee award must
be in accordance with the standards established under 5 U S C 7701(g)
/23/
Section 7701(g) provides that for an employee to be eligible for an
award of attorney fees in a case which does not involve discrimination,
the employee must be the prevailing party; that the award must be
warranted "in the interest of justice"; the amount must be reasonable
and the fees must be incurred by the employee. In addition, it has been
held that the standards established under section 7701(g) further
require a fully articulated, reasoned decision setting forth the
specific findings supporting the determination on each pertinent
statutory requirement, including the basis upon which the reasonableness
of the amount was determined when fees are awarded. /24/ Thus, it is
clear that in determining whether to award attorney fees under the Back
Pay Act, an arbitrator must be careful to conform to the standards
established under the Civil Service deform Act (CSRA) authorizing such
awards.
In resolving exceptions to awards of attorney fees, as in this case,
it falls to the Authority to assure that the award is not contrary to
law and hence is not deficient. In order for the Authority to properly
perform its role in resolving exceptions to such awards, it is necessary
to review the award under the Back Pay Act to assure that it meets the
statutory requirements.
The provisions of the Back Pay Act which allow awards of attorney
fees in certain specified circumstances were produced as the result of
legislative compromise. The legislative history of those provisions can
be instructive in their interpretation and application to the facts of
the case.
.2640, the version of the CSRA passed by the Senate contained
amendments to the Back Pay Act but made no provision for the payment of
attorney fees therein. However, section 7701(j) of S.2640, respecting
the appellate procedures of the Merit Systems Protection Board (MSPB),
provided, for cases not involving discrimination, that the MSPB:25/
... may require payment by the agency which is the losing party to
a proceeding before the Board, of reasonable attorney fees
incurred by an employee, if the employee is the prevailing party
and the deciding official or officials determine that payment by
the agency is warranted on the grounds that the agency's action
was taken in bad faith. ...
H.R. 11280, the version of the CSRA passed by the House of
representatives, in proposing to amend the Back Pay Act, provided that
the affected employee was entitled on correction of the personnel action
to receive: /26/
... reasonable attorney fees and reasonable costs and expenses of
litigation related to the personnel action which, with respect to
any decision relating to an unfair labor practice or a grievance
processed under a procedure, negotiated in accordance with chapter
71 of this title, shall be awarded in accordance with standards
established under section 7105(h) of this title. ...
Section 7105 of H.d. 11280 which described the powers and duties of
the Federal Labor Relations Authority would have assigned the Authority
some degree of discretion in establishing the standards to be applied in
determining when attorney fees should be awarded in unfair labor
practice cases and grievance arbitration awards. Section 7105(h),
provided as follows: /27/
The Authority shall, by regulation, establish standards which
shall be applied in determining the amount and circumstances in
which reasonable attorney fees and reasonable costs and expenses
of litigation may be awarded under section 7118(a)(5)(C) or
5596(b)(1)(B) of this title in connection with any unfair labor
practice or any grievance processed under a procedure negotiated
in accordance with this chapter.
The section of H.R. 11280 concerning MSPB pertinently provided, for
cases not involving discrimination, that the Board may require: /28/
... payment by the agency involved of reasonable attorney fees
incurred by an employee or applicant for employment if the
employee or applicant is the prevailing party and the Board,
administrative law judge, or other employee as the case may be,
determines that payment by the agency is warranted.
The Conference Committee resolved these conflicting versions by a
series of compromises. As one compromise, section 7105(h) in H.d. 11280
was dropped, thereby eliminating the provision which would have allowed
the Authority to fashion standards to be applied in determining the
amount and circumstances in which attorney fees may be awarded in unfair
labor practice cases and grievance arbitration cases. Instead, the
Conference Committee decided to permit the award of attorney fees in
unfair labor practice cases and arbitration cases only where backpay is
awarded and only under the standards set forth in 5 U.S.C. 7701(g).
Thus, at the meeting of the Conference Committee on September 18, 1978,
Congressman Udall stated: /29/
My proposal is a compromise. It would adopt the Senate provision
eliminating attorney's fees in the unfair labor practice area. It
would allow the appropriate authority-- FLRA or the arbitrator or
whoever in any grievance decision-- to award fees in conformity
with standards to be applied in the MSPB cases. Those standards
would be a middle ground between the Senate's bad faith. It would
be pretty hard to prove bad faith, we think, in most cases, and
the House's very loose standard which is simply "as warranted";
and when the employee wins the case on the merits and the Board
finds that the fees are warranted in the interest of fairness and
justice and so on.
The final compromise as to attorney fees for cases not involving
discrimination is reflected in the Conference Report on the Civil
Service Reform Act of 1978, H.R. 95-1717, 95th Cong., 2d Sess. (1978),
which stated at p. 142: /30/
The Senate bill authorizes attorneys' fees to be awarded in
appeals cases by a hearing officer whenever the employee prevails
and the officer determines that the agency's action was taken in
bad faith. ... The House amendment authorizes attorneys' fees in
any case where the officer determines that payment "is warranted".
... The conference substitute (section 7701(g) and
5596(b)(1)(A)(ii)) authorizes attorneys' fees in cases where (an)
employee prevails on the merits and the deciding official
determines that attorneys' fees are warranted in the interest of
justice, including a case involving a prohibited personnel
practice or where the agency's action was clearly without merit.
The reference to these two types of cases is illustrative only and
does not limit the official from awarding attorneys' fees in other
kinds of cases.
In light of this legislative history, it is clear that under the
Civil Service Reform Act of 1978, the Federal Labor Relations Authority
and arbitrators issuing awards under the provisions of section 7121 of
the Statute may award attorney fees, but only in the limited, specified
circumstances outlined above. Thus, in order to be eligible for the
award of attorney fees in unfair labor practice cases and in grievance
arbitration awards, it is not sufficient merely to be the prevailing
party. There must also be an award of backpay. In an earlier case,
Department of Defense, Dependents Schools and Overseas Education
Association, Inc., 3 FLRA 259 (1980), the Authority denied a union's
exceptions to an arbitrator's denial of its request for attorney fees on
the ground that in that case there had been "no determination that an
unjustified or unwarranted personnel action had resulted in the
withdrawal or reduction of the grievant's pay, a necessary threshold
determination for entitlement to attorney fees under the Back Pay Act,
as amended." 3 FLRA at 263.
Moreover, in cases where discrimination is not involved, prevailing
in an arbitration award which calls for backpay, even the retroactive
payment of environmental differentials, is not, standing alone, a
sufficient basis for an award of attorney fees. It is only the first
step in meeting the requirements under the Back Pay Act. The award of
attorney fees must also meet the applicable requirements of 5 U.S.C.
7701(g) and the standards established thereunder.
In Sterner v. Department of the Army, 711 F.2d 1563, 1571 (Fed. Cir.
1983), the U.S. Court of Appeals for the Federal Circuit summarized the
prerequisites to an award of attorney fees under section 7701(g)(1) of
CSRA as follows:
To summarize, there are two prerequisites to an award of
attorney's fees under section 7701(g)(1) which the board must
address in each case: whether the employee is the prevailing
party and whether an award is warranted in the interest of
justice. Determination of prevailing party should be a simple
task of deciding whether the employee succeeded in obtaining all
or a significant part of the relief sought. The question of
substantial innocence is not germane to this initial inquiry. ...
The board has considerable discretion in determining when an award
is warranted in the interest of justice. The non-exclusive
guidelines (established by the MSPB in its decision in Allen which
is discussed infra) are a valid starting point. The board may
also consider the extent of the employee's success. Economic
hardship per se is not a proper consideration as it would tend to
undermine the statutory intent, but the board may wish to consider
extraordinary hardships in appropriate cases ...
Clearly then, in the context of the present case, the mere
conclusions that an environmental differential is payable, and is
payable retroactively, are not sufficient to "trigger" an award of
attorney fees, or to support the award in the face of a challenge that
the award is contrary to law. Rather, as pointed out above, it must be
shown, among other things, that such award is in the interest of justice
in accordance with standards established under section 7701(g) Moreover,
the Authority is without discretion to ignore this requirement, or to
fashion its own standards upon which an award of attorney fees may be
made. Indeed, as noted in the above discussion of the legislative
history, the Authority would have had a great deal of discretion had the
provisions of H.R. 11280, including especially section 7105(h), been
adopted by the Congress and enacted into law. However, under the CSRA
as enacted, the Authority is constrained to apply the requirements set
forth in 5 U.S.C. 5596 and 5 U.S.C. 7701(g), including the standards
established under section 7701(g), in determining whether an award of
attorney fees by an arbitrator is contrary to law.
The MSPB in Allen v. U.S. Postal Service, 2 MSPB 582 (1980),
developed standards for ascertaining when an award of attorney fees "is
warranted in the interest of justice" as well as other standards for
such an award under 5 U.S.C. 7701(g)(1) The Court of Appeals for the
Federal Circuit has confirmed the validity of MSPB's standards for
determining whether attorney fees are warranted in the interest of
justice. /31/ As the court stated in Sterner, 711 F.2d at 1570:
The Allen guidelines are reasonable and are firmly based in the
statute and the legislative history; we therefore have no basis
for altering the Allen guidelines, noting itself emphasized that
the examples given were "not exhaustive."
As to the guidelines, the court stated in Yorkshire, 746 F.2d at
1456:
The parties correctly cite Allen v. U.S. Postal Service, 2
M.S.P.B. 582 (1980), as embodying the MSPB's prevailing standard
for interpretation of the "warranted in the interest of justice"
part of 7701(g)(1). Allen began with the proposition that the two
examples in the statute concerning when an award would be
warranted in the interest of justice are illustrative and not
exclusive. Id. at 587. The Board then reviewed the legislative
history of the statute to glean other instances in which an award
would be appropriate.
The Board in Allen found very illuminating the comments of Senator
Mathias, author of the "interest of Justice" language and member of the
Reform Act's conference committee. Senator Mathias described four
situations in which the Board might appropriately award attorney's fees:
(W)here he (the employee) is substantially innocent of the charges
that are leveled against him, or where the agency acted in bad
faith, or where there was some gross procedural error, or where
the agency knew or should have known that it couldn't prevail on
the merits when it brought the proceeding.
Id. at 589, quoting Transcript of Senate Committee on Governmental
Affairs' Mark-up Session on S. 2640, 95th Cong., 2d Sess. 124-25 (1978).
With the statutory examples and Senator Mathias' illustrations as a
base, the Board developed a set of five broad categories of cases in
which an award of attorney's fees fits within the statutory framework:
1. Where the agency engaged in a "prohibited personnel practice"
(7701(g)(1)); 2. Where the agency's action was "clearly without
merit" (7701(g)(1)), or was "wholly unfounded," or the employee is
"substantially innocent"' of the charges brought by the agency;
3. Where the agency initiated the action against the employee in
"bad faith," including: a. Where the agency's action was brought
to "harass" the employee; b. Where the agency's action was
brought to "exert improper pressure on the employee to act in
certain ways"; 4. Where the agency committed a "gross procedural
error" which "prolonged the proceeding" or "severely prejudiced"
the employee; 5. Where the agency "knew or should have known that
it would not prevail on the merits" when it brought the
proceeding. Id. at 593 (footnotes omitted). The Board dubbed
these headings "directional markers toward "the interest of
justice" rather than conclusive or fixed definitions. Id. We
confirmed the validity of the Allen guidelines in Sterner, supra,
711 F.2d at 1570.
Thus, in determining whether an award of attorney fees is within the
explicit terms of the provisions of the CSRA, both the requirements of
the Back Pay Act and section 7701(g) must be assessed. To summarize, in
order for an award of attorney fees to be authorized, the award of fees
must be in conjunction with an award of backpay to the grievant on the
correction of the unjustified or unwarranted personnel action, must be
reasonable and related to the personnel action, and must be in
accordance with the standards established under section 7701(g). That
section prescribes that the employee must be the prevailing party and
section 7701(g)(1), which applies to all cases except those of
discrimination, prescribes that the award of fees must be warranted in
the interest of justice, that the amount must be reasonable and that the
fees must have been incurred by the employee. With respect to the
interest of justice standard, the requirements and guidelines
established by the Merit Systems Protection Board in the Allen case and
approved by the U.S. Court of Appeals for the Federal Circuit are the
starting point in determining when an award of fees is warranted in the
interest of justice. Finally, there must be a "fully articulated,
reasoned decision" setting forth the specific findings supporting the
determination on each pertinent statutory requirement. It is the role
of the Authority here to determine whether the arbitrator's award of
attorney fees meets the statutory requirements noted above.
I wish to emphasize here that the Authority's function under the
Statute generally is to review the awards of the arbitrators to insure
that they are not deficient on grounds described in section 7122(a).
Under the Statute, grievance arbitration awards are final and binding so
long as they are not contrary to law, rule, or regulation or are
otherwise deficient on grounds applied by federal courts private sector
labor-management relations. The Authority does not judge the merits of
the dispute before the arbitrator. Thus, with respect to exceptions to
awards of attorney fees, the Authority's role is to insure that the
arbitrator has met the statutory requirements. It is not the role of
the Authority to substitute its judgment for that of the arbitrator.
III. APPLICATION OF THE STATUTORY REQUIREMENTS IN THIS CASE
As I indicated in the introduction to this concurring opinion, I wish
to discuss my conclusions regarding two of the requirements in this
case-- the requirement for a fully articulated, reasoned decision and
the requirement that an award of attorney fees be warranted in the
interest of justice.
I will first address the Agency's contentions that the arbitrator has
failed and refused to provide the parties and the Authority with a fully
articulated, reasoned decision setting forth the specific findings
supporting the determinations on each pertinent statutory requirement.
As noted in Part I of this concurring opinion, the arbitrator, in his
clarification and interpretation of the award of attorney fees, found
that they were payable "as fully explained in the Union's brief which is
incorporated into this decision." I cannot endorse this practice,
especially where the requirements under section 7701(g) as described by
the Authority in Army Support Command, Hawaii, call for "a fully
articulated, reasoned decision setting forth the specific findings
supporting the determinations on each pertinent statutory requirement,
including the basis upon which the reasonableness of the amount was
determined when fees are awarded."
After the matter was remanded by the Authority, the counsel for the
Union submitted to the arbitrator a 28-page, double-spaced typewritten
brief on the issue of attorney fees. The Agency submitted a 12-page,
single-spaced typewritten brief with 17 attachments. As Judge J. Skelly
Wright has noted in connection with a somewhat similar circumstance,
"(t)hese lawyers and properly so, in their zeal and advocacy and their
enthusiasm are going to state the case for their side ... as strongly as
they possibly can." /32/ Moreover, where attorneys contest points of law
and offer persuasive arguments on both sides of an issue, it falls to
the decision maker to resolve those points of law and those issues. In
the circumstances here, a fully articulated, reasoned decision setting
forth the specific findings supporting the determination on each
pertinent statutory requirement for an award of attorney fees calls for
an analysis of the parties' differing positions and an independent,
objective explanation for the arbitrator's conclusions. To instead
adopt in to the brief of one side and to incorporate that brief into his
decision, and to describe the brief of the opposing side simply as "a
lengthy citation of authorities which are largely inappropriate and
irrelevant" comes perilously close to an abdication of this
responsibility. The arbitrator said in his clarification and
interpretation that "I know how to spell out justification for attorney
fees, when needed." He should have done so in this case.
As the U.S. Court of Appeals for the District of Columbia Circuit
recently said in addressing a somewhat similar problem: /33/
... (W)e wish to make clear that we cannot endorse the District
Judge's action in extensively copying the proposed findings of
fact and conclusions of law prepared by counsel for (one of the
parties). As the Supreme Court noted in El Paso Natural Gas Co.,
this practice "is an abandonment of the duty and the trust that
has been placed in the judge." 376 U.S. at 657 n. 4, 84 S. Ct. at
1047 n. 4 (quoting J. Skelly Wright, Seminars for Newly Appointed
United States District Judges 156 (1963)). As the present case
illustrates, the parties, the public and the reviewing court can
never be certain that the judge actually decided the case on the
grounds given in the copied Memorandum Opinion. Confidence in the
integrity of the judicial process inevitably suffers when judges
succumb wholesale to this practice.
Similarly, I cannot endorse the action of the arbitrator here in
merely incorporating the contentions and arguments of counsel
representing one of the parties before him. A fully articulated,
reasoned opinion is required by the Authority in these cases because it
is a requirement for authorizing attorney fees under the Back Pay Act.
If the arbitrator fails to perform his function in this regard, he fails
his duty under law and fails to meet his obligation to the parties who
selected him to resolve their grievance.
Certainly, therefore, it would have been far preferable had the
arbitrator not succumbed to the temptation of incorporating one side's
position and instead spelled out the justification for the award himself
is he admits he knows how to do. Because such a fully articulated,
reasoned justification is not expressly set forth by the arbitrator, in
my opinion his entire award. as supplemented and later clarified, must
be examined to determine whether sufficient findings can be gleamed
which would support his conclusion that an award of attorney fees is
warranted in the interest of justice. In my view, it is appropriate to
adopt such a course of action in this case in light of the arbitrator's
explicit references to his initial and supplemental awards in his
clarification here under review. I wish again to underscore that in
examining the entire award, I will not be placing myself in the
arbitrator's shoes to judge the merits of the dispute the parties placed
before him, .i.e., whether attorney fees are warranted in this case.
Instead, I will, consistent with the Authority's statutory function in
arbitration cases, examine the arbitrator's entire award to see whether
his decision to grant fees is supported by the specific findings
required by law.
As an initial matter, I would observe that in Allen the MSPB was
applying the provisions of section 7701(g)(1) in an adverse action
appeal under 5 U.S.C. chapter 77. Consequently, most of the MSPB's
Allen guidelines relate an award of attorney fees to some action taken
by an agency against an employee, which action is being overturned or
modified.
In the instant case we are not examining an award of attorney fees in
similar circumstances. There has been no "adverse action" taken against
an employee; clearly it is not a matter covered by 5 U.S.C. 7512. /34/
We are not dealing with an action based on unacceptable performance
covered by 5 U.S.C. 4303. /35/ Instead, we are here faced with a
grievance arbitration award wherein the arbitrator has found in effect
that employees had been improperly denied a benefit, namely,
environmental differential pay, and the question is whether an award of
attorney fees is warranted in the interest of justice in these
circumstances.
Even though these circumstances differ from those in Allen, some of
the Allen guidelines could apply to a situation wherein agency
management has improperly denied benefits to an employee, e.g., where
the agency's action was "clearly without merit' or where the agency
"knew or should have known that it would not prevail on the merits."
Furthermore, the MSPB and the courts have been faced with a somewhat
analogous situation, in a case in which employees' applications for
disability retirement have been denied. In Scarborough v. Office of
Personnel Management, 723 F.2d 801 (11th Cir. 1984), the U.S. Court of
Appeals for the Eleventh Circuit noted that section 7701(g) provides
that it applies to "any case in which a prohibited personnel practice
was engaged in by the agency or in any case in which the agency's action
was clearly without merit." In concluding that the underlined words
created a "second classification" of cases in which an award of attorney
fees would be warranted in the interest of justice, the court stated:
"An unreasonable denial of retirement benefits could easily be
encompassed under this second classification." /36/ For the reasons
similar to those articulated in this respect in Scarborough, I would
conclude under the Back Pay Act that a denial of environmental
differential pay "could easily be encompassed" under the same
classification, i.e., a case in which the agency's action was clearly
without merit, if such denial of environmental differential pay were
found to be "unreasonable."
Therefore, in this case, in order to decide whether the award of
attorney fees is warranted in the interest of justice, I believe it is
necessary to examine the arbitrator's findings to see whether there is a
sufficient basis to conclude that the Agency knew or should have known
it would not prevail on the merits or that the Agency's denial of
environmental differential pay was unreasonable and thus clearly without
merit. My analysis is thus based on relevant Allen factors and on the
related approach taken in this respect in Scarborough. Since the Allen
factors are guidelines and not intended to be exhaustive, I see no need
to apply the other factors set forth in Allen.
I have concluded that the arbitrator's findings support a
determination that management's denial of the environmental differential
pay in the circumstances of this case was unreasonable and that
management should have known that it would not prevail on the merits of
the grievance. Therefore, the arbitrator's award of attorney fees as
being warranted in the interest of justice is supported and must stand.
As noted in Part I of this concurring opinion, the arbitrator found in
pertinent part that:
(A) Management had stated without reservation that it would
apply safety procedures to asbestos levels below the limits set by
OSHA.
(B) Management had gone a step further in requiring these
safety precautions to be taken whenever working with asbestos no
matter what the airborne concentration of asbestos and that all
equipment utilized must conform to NIOSH standards.
(C) While the procedure which management had set up was, in
theory, admirable for the protection of employees against the
hazard involved, a NIOSH report, introduced at the hearing and
attached to the arbitrator's initial award, "labeled several
practical protective measures, including the wearing of
respirators, as "not at all satisfactory."
(D) Management knew that, in an installation striving for zero
asbestos exposure, forty full days each year of exposure exceeding
NIOSH standards (in the case of pipefitters) reflected hazardous
conditions requiring greater attention.
(E) The asbestos problem was clear cut and thoroughly
documented and presented a continuing struggle for safety in the
workplace.
Therefore, the arbitrator rejected management's contention that it
was providing protective equipment which was practically eliminating the
potential for personal illness and injury. As a result the affected
employees were awarded environmental differential pay for "(w)orking in
an area where airborne concentrations of asbestos fibers may expose
employees to potential illness or injury and protective devices or
safety measures have not practically eliminated the potential for such
personal illness or injury."
In light of the arbitrator's findings concerning the high standards
that management had set for itself, the documented failure to meet those
standards and to provide satisfactory practical protective measures, and
management's knowledge of forty full days each year of employee exposure
exceeding NIOSH standards, it was unreasonable for management to take
the position that it was providing protective equipment which was
practically eliminating the potential for personal illness and injury
and for that reason to deny the employees the benefit of environmental
differential pay. Furthermore, because management knew that its
measures did not provide satisfactory protection and because it knew
that it had failed to meet the standards which it set for itself,
management should have known that it would not prevail on the merits in
this grievance. Therefore, I conclude that the arbitrator made
sufficient findings to support the conclusion that attorney fees were
warranted in the interest of justice.
In summary on this point, in these circumstances, in my opinion, it
is clear that the arbitrator's award contains a sufficient basis to
conclude that the Agency's denial of the environmental differential pay
was unreasonable and hence without merit and that the Agency knew or
should have known they would not prevail on the merits of the grievance/
arbitration proceeding, and that the award of attorney fees in this case
therefore is "warranted in the interest of justice."
(s)---
Henry B. Frazier III, Member
--------------- FOOTNOTES$ ---------------
/1/ See, e.g., Allen v. U.S. Postal Service, 2 MSPB 582 (1980);
Kling v. Department of Justice, 2 MSPB G20 (1980).
/2/ Arbitrator's Report to the Authority, dated December 5, 1984.
/3/ National Weather Service Employees Organization (MEBA AFL-CIOS
and National Weather Service, Western Region, 17 FLRA No. 91 (1985).
/4/ U.S. Army Corps of Engineers and National Federation of Federal
Employees, Local 639, 17 FLRA No. 67 (1985).
/5/ 5 U.S.C. 5596(b)(1)(A)(ii).
/6/ 5 U.S.C. 5596(b)(3).
/7/ See also Audie L. Murphy VA Hospital, San Antonio, Texas and
American Federation of Government Employees, AFL-CIO, Local No. 3511, 16
FLRA 1079 (1984).
/8/ Section 7701(g)(2), pertaining to cases of discrimination
prohibited by 5 U.S.C. 2302(b)(1), requires as to such cases that the
award of attorney fees must be in accordance with the standards
prescribed under section 706(k) of the Civil Rights Act of 1964, 42
U.S.C. 2000e-5(k).
/9/ See Simmons v. MSPB, 768 F.2d 323 (Fed. Cir. 1985) and
Scarborough v. OPM, 723 F.2d 801 (11th Cir. 1984) (attorney fees awarded
in connection with disability retirement applications under 5 U.S.C.
8347).
/10/ Compton v. Department of Energy, 9 MSPB 91 (1982); Trowell v.
United States Postal Service, 3 MSPB 117 (1980).
/11/ O'Donnell v. Department of Interior, 2 MSPB 604 (1980).
/12/ See Boese v. Department of the Air Force, No. 85-2327 (Fed. Cir.
Feb. 19, 1986); Yorkshire v. Merit Systems Protection Board, 746 F.ed
1454 (Fed. Cir. 1984).
/13/ Wise v. MSPB, No. 85-1974 (Fed. Cir. Dec. 30, 1985).
/14/ Steger v. Defense Investigative Service, 717 F.2d 1402 (D.C.
Cir. 1983).
/15/ Wells v. Harris, 2 MSPB 572 (1980).
/16/ Sterner v. Department of the Army, 711 F.2d 1563, 1568-69 (Fed.
Cir. 1983).
/17/ E.g. American Federation of Government Employees, National
Border Patrol Council and U.S. Immigration and Naturalization Service,
Southern Region, Dallas, Texas, 3 FLRA 540 (1980).
/18/ I note the Authority's concurrent action in rescinding its
decision setting aside the award of attorney fees in 20 FLRA No. 37 and
remanding the case to the parties with direction that they request the
arbitrator to clarify his award be providing the requisite fully
articulated, reasoned decision setting forth specific findings on all
pertinent statutory requirements.
/19/ Arbitrator's Report to the Authority, December 5, 1984, at 3-7.
/20/ Back Pay Act of 1966, P.L. 89-380, 80 Stat. 94 (codified as
amended at 5 U.S.C. 5595 (1982)). See Appendix.
/21/ In contrast, an award of attorney fees issued more than one year
subsequent to the issuance of Army Support Command, Hawaii, and thus
with the benefit of the instruction and guidance provided therein, which
did not provide a fully articulated, reasoned decision, was found
deficient by the Authority and the award was set aside. See National
Association of Air Traffic Specialists and Federal Aviation
Administration, Washington; light Service Station, 20 FLRA No. 87
(1985). However, on this date the Authority has issued an
/22/ 5 U.S.C. 5596 (1982). See Appendix.
/23/ 5 U.S.C. 7701(g) (1982). See Appendix.
/24/ Allen v. U.S. Postal Service, 2 MSPB 582 (1980); Kling v.
Department of Justice, 2 MSPB 620 (1980); see also 5 CFR 550.806
(1985).
/25/ Legislative History of the Civil Service Reform Act of 1978,
Comm. on Post Office and Civil Service, House of representatives, 96th
Cong., 1st Sess., 1762 (Comm. Print No. 96-2 1979).
/26/ Legislative History of the Federal Service Labor- Management
Relations Statute, Title VII of the Civil Service Reform Act of 1978,
Comm. on Post Office and Civil Service, House of Representatives, 96th
Cong., 1st Sess. 981 (Comm. Print No. 96-7 1979).
/27/ Id. at 971.
/28/ Section 7701(G)(1), 124 Cong. Rec. 29,229 (1978).
/29/ As reported at page 404 of the transcript of proceedings of the
House-Senate Conference on S. 2340, the Civil Service Reform Act of
1978.
/30/ Legislative History of the Federal Service Labor-Management
Relations Statute, supra note 26, at 810.
/31/ Sterner v. Department of the Army, 711 F.2d 1563, 1570 (Fed.
Cir. 1983); Sims v. Department of the Navy 711 F.2d 1578 1581 (Fed.
Cir. 1983); Yorkshire v. Merit Systems Protection Board, 746 F.2d 1454,
1455 (Fed. Cir. 1984).
/32/ Remarks of Judge J. Skelly Wright in Seminars for Newly
Appointed United States District Judge; (1963), p. 166. See also
United States v. El Paso Natural Gas Company, 376 U.S. 1044, 1047 n.4
(1964).
/33/ Southern Pacific Communication Co. v. American Telephone and
Telegraph Co., 740 F.2d 980, 995 (D.C. Cir. 1984), cert. denied 105
S.Ct. 1359 (1985).
/34/ 5 U.S.C. 7512 provides:
7512. Actions covered This subchapter applies to-- (1) a removal;
(2) a suspension for more than 14 days; (3) a reduction in
grade; (4) a reduction in pay; and (5) a furlough of 30 days or
less; but does not apply to-- (A) a suspension or removal under
section 7532 of this title, (B) a reduction-in-force action under
section 3502 of this title, (C) the reduction in grade of a
supervisor or manager who has not completed the probationary
period under section 3321(a)(2) of this title if such reduction is
to the grade held immediately before becoming such a supervisor or
manager, (D) a reduction in grade or removal under section 4303 of
this title, or (E) an action initiated under section 1206 or 7521
of this title.
/35/ As to the types of actions covered, 5 U.S.C. 4303 provides in
pertinent part:
4303. Actions based on unacceptable performance
(a) Subject to the provisions of this section, an agency may reduce
in grade or remove an employee for unacceptable performance.
(f) This section does not apply to--
(1) the reduction to the grade previously held of a supervisor
or manager who has not completed the probationary period under
section 3321(a)(2) of this title,
(2) the reduction in grade or removal of an employee in the
competitive service who is serving a probationary or trial period
under an initial appointment or who has not completed 1 year of
current continuous employment under other than a temporary
appointment limited to 1 year or less, or
(3) the reduction in grade or removal of an employee in the
excepted service who has not completed 1 year of current
continuous employment in the same or similar positions.
/36/ 723 F.2d at 814.
APPENDIX
5 U.S.C. 5596 (1982) pertinently provides:
An employee of an agency who, on the basis of a timely appeal or an
administrative determination (including a decision relating to an unfair
labor practice or a grievance) is found by appropriate authority under
applicable law, rule, regulation, or collective bargaining agreement, to
have been affected by an unjustified or unwarranted personnel action
which has resulted in the withdrawal or reduction of all or part of the
pay, allowances, or differentials of the employee
(A) is entitled, on correction of the personnel action, to
receive for the period for which the personnel action was in
effect--
(i) an amount equal to all or any part of the pay, allowances,
or differentials, as applicable which the employee normally would
have earned or received during the period if the personnel action
had not occurred, less any amounts earned by the employee through
other employment during that period; and
(ii) reasonable attorney fees related to the personnel action
which, with respect to any decision relating to an unfair labor
practice or a grievance processed under a procedure negotiated in
accordance with chapter 71 of this title, or under chapter 11 of
title 1 of the Foreign service Act of 1980, shall be awarded in
accordance with standards established under section 7701(g) of
this title(.)
5. U.S.C. Section 7701(g) (1982) provides:
(1) Except as provided in paragraph (2) of his subsection, the
Board, or an administrative law judge or other employee of the
Board designated to hear a case, may require payment by the agency
involved of reasonable attorney fees incurred by an employee or
applicant for employment if the employee or applicant is the
prevailing party and the Board, administrative law judge, or other
employee (as case may be) determines that payment by the agency is
warranted in the interest of justice, including any case in which
a prohibited personnel practice was engaged in by the agency or
any case in which the agency's action was clearly without merit.
(2) If an employee or applicant for employment is the
prevailing party and the decision is based on a finding of
discrimination prohibited under section 2302(b)(1) of this title,
the payment of attorney fees shall be in accordance with the
standards prescribed under section 705(k) of the Civil Rights Act
of 1964 (42 U.S.C. 2000e-5(k)).