Appeals Court Overrules Federal Labor Relations Authority on 15-Year-Long Union Dispute

A long-running saga by a federal union to ensure employees are appropriately paid can continue, after a federal appeals court ruled last week that the Federal Labor Relations Authority improperly dismissed the union’s unfair labor practice complaint.

Last year, the FLRA ruled against the Federal Education Association in their dispute with the Defense Department Education Activity, an agency that provides schooling for Defense Department employees around the world. The conflict dates back to 2002, when the union found that the agency was underpaying some of its teachers and failing to provide them with consistent payroll information and filed a grievance, in which an arbitrator ruled in FEA’s favor.

In 2015, the union filed an unfair labor practice complaint over the agency’s refusal to comply with the arbitrator’s decision, citing a May 2015 agency request not to make required upgrades its payroll system to provide better information to employees.

The FLRA overruled an administrative law judge and dismissed the complaint in June 2018, concluding the union had missed a 2010 deadline to object to the agency’s noncompliance, citing a May 2010 letter from the Defense Finance and Accounting Service, which runs the payroll software used by the Education Activity agency.

In a June 21 decision, the U.S. Court of Appeals for the D.C. Circuit said the FLRA’s decision was not supported by the evidence. Contrary to the FLRA’s ruling, DFAS’ 2010 letter did not “expressly” inform the union that it would not comply with the arbitrator’s award. And in fact, the Education Activity omitted a portion of the DFAS letter that could have been construed as a refusal to comply from what it provided to union.

“The agency’s May 2010 letter did not expressly reject the agency’s obligations,” wrote Circuit Judge Cornelia Pillard. “Rather, it suggested that the agency was largely in compliance with the awards and would continue to work on meeting their terms . . . Importantly, when the agency forwarded DFAS’ response to the union, it omitted the assertion that DFAS did not view itself as bound to make any changes.”

Additionally, the agency continued to hold yearly meetings with the union and the arbitrator to update them on efforts to make the required changes to the payroll system.

“Even in communications outside the arbitrator’s presence—where the agency would presumably have had less incentive to put a positive spin on its efforts—the agency did not seem to think that compliance was impossible,” the court stated. “In June 2011, for example, the agency and DFAS went back and forth via email about a potential cost estimate for implementing the remaining changes. The agency expressed eagerness to get an estimate so that it could ‘allocate money for the . . . upgrades.’”

Although the decision means the Federal Education Association’s unfair labor practice can proceed again, the court did not rule entirely in the union’s favor. The union requested that the appeals court retain jurisdiction of the case, arguing that if the FLRA were ordered to rehear the complaint, it would simply “fabricate another reason to overrule” the administrative law judge.

FEA currently has a separate lawsuit in U.S. District Court that accuses the FLRA of systemic bias against labor, citing an unusually high rate of overturning arbitration cases compared with previous administrations, almost universally in favor of management.

“The union’s sole factual support for its assertions of bias is a chart it created comparing the outcomes of [FLRA] cases during the current presidential administration to the outcomes during the previous two,” Pillard wrote. “According to the comparison, unions have fared worse under this administration than in prior years, and it attributes that lack of success to the authority’s bias. But a simple win-loss chart does not demonstrate that the authority has prejudged the cases.”

The case now goes back to the FLRA for reconsideration.