No. 84-1439.United States Court of Appeals, District of Columbia Circuit.Argued May 2, 1985.
Decided November 22, 1985.
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William J. Stone, with whom Mark D. Roth, Washington, D.C., was on the brief, for petitioner.
William E. Persina, Associate Sol., Federal Labor Relations Authority, with whom Ruth E. Peters, Sol., Steven H. Svartz, Deputy Sol., and Robert J. Englehart, Atty., Federal Labor Relations Authority, Washington, D.C., were on the brief, for respondent.
Petition for Review of an Order of the Federal Labor Relations Authority.
Before MIKVA and SCALIA, Circuit Judges, and HAROLD H. GREENE,[*] District Judge.
Opinion for the Court filed by District Judge HAROLD H. GREENE.
Concurring opinion filed by Circuit Judge SCALIA.
HAROLD H. GREENE, District Judge:
[1] Petitioner American Federation of Government Employees (AFGE) seeks review of a dismissal by the Federal Labor Relations Authority (FLRA) of an unfair labor practice complaint initiated by AFGE against a federal agency on account of that agency’s refusal to comply with an arbitrator’s award. The agency had filed exceptions to the arbitrator’s decision but it had neither sought nor obtained a stay of that decision. We agree with petitioner that, absent a stay, the agency was obligated to comply with the arbitration decision, and that the dismissal of the unfair labor practice complaint was improper. I
[2] The facts are undisputed.[1] In March, 1981, officials of the United States Soldiers’ Home and Airmen’s Home (Home) suspended, and then fired, a nursing assistant who had been accused of mistreating patients. Petitioner AFGE, the employee’s bargaining representative, grieved the employee’s suspension and discharge. The grievance was submitted to arbitration under the terms of the collective bargaining agreement between petitioner and the Home. After extensive hearings and briefing, the arbitrator, on March 25, 1982, issued an opinion and order sustaining the grievance and ordering the grievant reinstated, with backpay, within ten days of the order.
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notwithstanding FLRA regulations codified in 5 C.F.R. § 2429.8
which specify that the filing of exceptions does not, by itself, stay an arbitration award,[4] the Home neither requested a stay of the arbitration award nor did it comply with the award.
and that this violation constituted an unfair labor practice within the meaning of 5 U.S.C. §§ 7116(a)(1), (8).[7] On July 29, 1982, the FLRA General Counsel issued an unfair labor practice complaint based on the charge, and the case was assigned to an Administrative Law Judge for the issuance of a recommended decision and order. [5] On November 24, 1982, the ALJ issued a decision recommending that the complaint be dismissed. His decision cited essentially two factors: (1) that the language of section 7122(b) does not, in so many words, provide that arbitration awards to which exceptions have been filed are final and binding,[8] and (2) that the FLRA, in a notice of proposed rulemaking (which was subsequently withdrawn), had indicated its view that an arbitration award should not be regarded as final if exceptions thereto had been filed. See p. 19, infra. [6] Some nineteen[9] months later, the FLRA affirmed the ALJ’s decision.[10] The Authority, in a brief decision,[11] adopted the ALJ’s analysis; AFGE timely requested reconsideration; and when reconsideration was denied, it petitioned this court for review.[12]
II
[7] The basic question[13] in this case is whether the FLRA properly construed 5 U.S.C. § 7122(b)
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as not requiring agency compliance with arbitration awards to which unresolved exceptions have been taken on the ground that such awards are not “final” within the meaning of the statute. If the awards are final, as petitioner contends, the Home’s failure to comply (absent a stay) was a violation of section 7122 and an unfair labor practice under 5 U.S.C. §§ 7116(a)(1), (8). If, on the other hand, such awards are not final, as the FLRA held in this case, then neither a violation of section 7122 nor an unfair labor practice has occurred.
[8] The scope of our review of the FLRA’s decision is governed by section 701 of the Act, 5 U.S.C. § 7123, which subjects Authority decisions to review under the Administrative Procedure Act’s arbitrary, capricious, and abuse of discretion standard, 5 U.S.C. § 706. See National Treasury Employees Union v. FLRA, 721 F.2d 1402, 1405 (D.C. Cir. 1983). As the Supreme Court has recognized, under this standard the Authority is entitled to “considerable deference when it exercises its `special function of applying the general provisions of the Act to the complexities’ of federal labor relations.” Bureau of Alcohol, Tobacco and Firearms v. FLRA, 464 U.S. 89, 97, 104 S.Ct. 439, 444, 78 L.Ed.2d 195 (1983) (citation omitted). At the same time, the Court has also noted that, while reviewing courts should uphold reasonable and defensible agency constructions of their organic statutes, they should not “rubber stamp . . . administrative decisions that they deem inconsistent with a statutory mandate or that frustrate the congressional policy underlying a statute.” Id. It is with these guidelines in mind that we examine the FLRA decision and the statute. [9] A. Statutory Language[10] We begin our analysis, as always, by considering the relevant statutory language.[14] See Consumer Product Safety Commission v. GTE Sylvania, Inc., 447 U.S. 102, 108, 100 S.Ct. 2051, 2056, 64 L.Ed.2d 766 (1980); National Wildlife Federation v. Gorsuch, 693 F.2d 156, 170 (D.C. Cir. 1982). As indicated,[15] section 7122(b) provides in relevant part as follows:
[11] It is apparent from an examination of this language that it does not directly address the issue presented in this case i.e., the status of arbitral awards to which exceptions have timely been taken. Clearly, the statute requires agencies to take actions required by an arbitrator’s final award, and it further provides that awards to which no exceptions have been taken are “final and binding.” The statute does not say, however, that awards to which exceptions have not been taken are the only awards that are “final” within the meaning of the statute, nor does it say that awards to which exceptions have timely been taken are not “final.” On both of these questions, the statute is simply silent. [12] To be sure, if the phrase “arbitrator’s final award” could not reasonably in context be read to include arbitration awards to which unresolved exceptions are pending, then any statutory ambiguity would only be illusory. See Howe v. Smith, 452 U.S. 473, 483, 101 S.Ct. 2468, 2475, 69 L.Ed.2d 171 (1981); Petry v. Block, 697 F.2d 1169, 1171 (D.C. Cir. 1983) (per curiam). That, however, is not the case. There are at least two analogous legal contexts, of which the Congress undoubtedly was aware,[16] in which adjudicative decisions are characterized as “final” notwithstanding the availability of further review. [13] The most obvious analogy is to private sector labor arbitrations. Such arbitrations are characterized as final decisions with which parties must comply, even though, like federal employee arbitrations, they are subject to limited review in subsequent proceedings to determine their compliance with applicable law. See United Steelworkers v. Enterprise Wheel and Car Corp., 363 U.S. 593, 596, 599, 80 S.Ct. 1358, 1360, 1362, 4 L.Ed.2d 1424 (1960); Devine v. White, 697 F.2d 421, 436 (D.C. Cir. 1983); see generally, Elkouri and Elkouri, How Arbitration Works, 65-66, 87-88 (4th ed. 1985); Updegraff, Arbitration and Labor Relations, 275-92 (3d ed. 1970). Indeed, it is a cardinal principle of arbitration that such awards are reviewable and enforceable only if they are “final” — that is, if they purport to resolve all aspects of the dispute being arbitrated. Se Matter of Michaels and Mariforum Shipping, S.A., 624 F.2d 411, 413-14 (2d Cir. 1980); see generally, Elkouri, supra, at 255; Updegraff, supra, at 279-81. [14] Congress clearly was aware of the private sector labor arbitration experience,[17] and it is therefore reasonable to conclude that, in drafting the language of section 7122(b), Congress had the private sector model in mind, and that the statutory phrase “arbitrator’s final award” may properly be read in light of the meaning generally assigned to that phrase in the private sector arbitration context. See Devine v. White, supra, 697 F.2d at 432-33. [15] Another analogy of which the Congress may be deemed to have been aware is the federal judicial process. The general rule in the federal courts is that appellate review may be had only of “final decisions” of district courts — that is, of judgments that constitute full resolutions on the merits. See 28 U.S.C. § 1291 Liberty Mutual Insurance Co. v. Wetzel, 424 U.S. 737, 743-44, 96 S.Ct. 1202, 1206-07, 47 L.Ed.2d 435 (1976). Compliance with such final judgments is, of course, required, unless the particular judgment is stayed by the district court or the court of appeals pending resolution of the appeal. See Fed.R.App.P. 8; Fed.R.Civ.P. 62; see generally, 11 C. Wright and A. Miller Federal Practice and Procedure: Civil §§ 2902-08 (1973 and Supp.). Thus, if the word “final” as used in section 7122(b) is read to have the same meaning as it does in the judicial appellate context, arbitrators’ awards which have been appealed by means ofIf no exception to an arbitrator’s award is filed under subsection (a) of this section [within 30 days], the award shall be final and binding. An agency shall
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take the actions required by an arbitrator’s final award.
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taking exceptions could be considered to be “final” within the meaning of the statute.
[16] To be sure, these analogies, and congressional awareness of their existence, do not conclusively establish that the word “final” in section 7122(b) must be read to include arbitrators’ awards to which exceptions are pending. However, together with the failure of section 7122(b) specifically to address the situation of unstayed exceptions, they do establish that the statutory language is sufficiently ambiguous[18] to permit resort, in addition to that language, to other traditionally recognized indicia of legislative intent. [17] B. Legislative History[18] The legislative history of section 7122(b) is unfortunately unenlightening as to the finality, or lack thereof, of arbitral awards to which exceptions have been filed. [19] The language of section 7122(b) originated in the House of Representatives version of what ultimately became the Federal Labor-Management Relations Act.[19] In fact, the relevant section of the House bill is virtually identical to the provision that was finally enacted.[20] The Committee Report accompanying the bill described the procedures under which exceptions could be filed and reviewed by the FLRA, indicated that the committee had rejected a proposal that the Comptroller General be given plenary authority to review arbitration awards, and noted that the proposed language would require agencies to take the actions required by final arbitration awards.[21] But the Report does not elaborate on what is meant by the phrase “final arbitral award” beyond the statutory language itself. [20] The Conference Committee adopted the House provision, which had no counterpart in the Senate bill,[22] and its report explained the purpose of the provision as follows:
[21] It is fair to conclude that Congress adopted the section 7122(b) language primarily to make certain that arbitration awards would be subject to review only by the FLRA. Beyond that, none of the legislative materials elaborate further on the question of when arbitral awards to which exceptions have been taken become final. In short, while the legislative history of section 7122(b) underscores the congressional intent that agencies comply with final arbitration awards, and that the arbitration process provide an efficient, expeditious mechanism for resolving federal labor-management disputes, it fails to resolve the issue of whether excepted-to arbitration awards are final. [22] C. Agency Construction. . . The conferees adopted the House provision. The intent of the House in adopting this provision was to make it clear that the awards of arbitrators, when they become final, are not subject to further review by any other authority or administrative body, including the Comptroller General.[23]
[23] Far more illuminating than that history is the longstanding construction of section 7122(b) by the FLRA, the agency charged with administering the statute. Virtually from the day the statute was enacted until this day,[24] the FLRA has had on the books
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a regulation which sets up an elaborate procedure for the seeking and granting of stays of arbitration decisions, and which further provides explicitly that the filing of an exception does not operate as a stay of such a decision — that only a stay granted by the FLRA can have that effect.[25] It is necessarily the implicit premise underlying these regulations that in the opinion of the FLRA the statute requires an unsuccessful party to the arbitration process to secure a stay to avoid being bound, then and there, by an arbitration decision, or, at a minimum, that the statute permits the Authority to require a successful application for a stay as a prerequisite to noncompliance with an arbitral award.[26]
[24] Where, as here, the legislative intent is not otherwise plain, we are obligated to accord substantial deference to the FLRA’s consistent construction of its organic statute. See National Labor Relations Board v. Bell Aerospace Co., 416 U.S. 267, 274-75, 94 S.Ct. 1757, 1761-62, 40 L.Ed.2d 134 (1974); cf National Treasury Employees’ Union v. FLRA, 712 F.2d 669, 673(D.C. Cir. 1983). Thus, absent any substantial grounds for concluding that the FLRA’s longstanding regulation violates section 7122(b), adherence to this principle compels the conclusion that under the statute, as properly interpreted, arbitral awards which have not been stayed are final and binding, or, at a minimum, that the question whether such awards are final is an open one under the statute, to be determined as a matter of policy by the Authority. But the statute clearly cannot be read to provide that the FLRA is prohibited from considering arbitral awards to be final and binding.
III
[25] As indicated by its decision in this case, the FLRA appears[27] now to have reinterpreted section 7122(b) to mean that arbitration awards are not final, and hence not binding on the government agencies to which they are directed, if exceptions have been filed. In support of this new interpretation, the FLRA contends before this court that its previous construction is inconsistent with the underlying statutory purpose. In the Authority’s present view, if arbitral awards were treated as final under section 7122(b), the exceptions procedure would be rendered virtually useless because a government agency would have to comply with an arbitration award against it during the period in which the exceptions are pending even though the award was ultimately overturned by the FLRA. Thus, it is said, Title VII’s careful balancing of federal agency management and employee interests would be undone and the procedures skewed in favor of the employees.
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are decided on essentially the same grounds as requests for stays of federal district court orders pending appeal[29] — will prevent government agencies from suffering prejudice from being forced to comply with improper arbitration awards, and it will at the same time maintain the congressionally-mandated balance of management and labor interests incorporated in the CSRA.
[27] On the other hand, the FLRA’s new construction of the statute could well result in a skewing of the congressionally-mandated balance in the opposite direction. Reading section 7122(b) to provide that the mere filing of exceptions automatically stays compliance with arbitration awards pending the resolution of the exceptions would, of course, have the effect of unnecessarily delaying compliance with a proper award, thus severely prejudicing aggrieved employees.[30] Such a result is particularly undesirable in view of the fact that in nearly ninety percent of the cases in which exceptions to arbitration awards were filed, the FLRA ultimately has dismissed the exceptions and upheld the award,[31] just as it did in this case.[32] [28] Notwithstanding these considerations, we do not hold that the FLRA is affirmatively required by the statute to construe and administer that law to effectuate these purposes, but only that a construction consistent with their effectuation and with the Authority’s own stay regulations is not prohibited by section 7122(b). IV
[29] Finally, we must consider whether the Authority’s decision in the instant case, which of course is inconsistent with the existing FLRA regulations, can be sustained by this court. We conclude that the answer must be in the negative.
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with fundamental principles of administrative procedure.
[32] Although administrative agencies are not subject to a requirement of absolute consistency, compliance with a reasonable level of consistency clearly is required in a variety of contexts. For example, administrative agencies are generally “under an obligation to follow their own regulations, procedures and precedents.” National Conservative Political Action Committee v. Federal Election Committee, 626 F.2d 953, 959(D.C. Cir. 1980); see also, United States v. Nixon, 418 U.S. 683, 694-96, 94 S.Ct. 3090, 3100-02, 41 L.Ed.2d 1039 (1974); Lucas v. Hodges, 730 F.2d 1493, 1504 n. 20 (D.C. Cir. 1984). See generally, 2 K Davis, Administrative Law Treatise, § 7:21 at 98-99 (1979). Similarly, an agency seeking to repeal or modify a legislative rule promulgated by means of notice and comment rulemaking is obligated to undertake similar procedures to accomplish such modification or repeal, see Action on Smoking and Health v. Civil Aeronautics Board, 713 F.2d 795, 798-801 (D.C. Cir. 1983), and to provide a reasoned explanation for the change addressing with some precision any concerns voiced in the comments received Id. at 798 note 2. See also, Action on Smoking and Health v. Civil Aeronautics Board, 699 F.2d 1209, 1216, 1218 (D.C. Cir. 1983). Thus, unless and until it amends or repeals a valid legislative rule or regulation, an agency is bound by such a rule or regulation. See United States v. Nixon, supra; Davis, supra. [33] These fundamental principles would be vitiated if an agency could validly justify an adjudication on the ground that longstanding interpretation of the organic statute as reflected in validly adopted, existing legislative rules was erroneous. Similarly, an adjudication which violates such rules cannot be defended on the basis of an explanation accompanying a proposed
rules change, a change, moreover, which was subsequently withdrawn. Were the Authority’s approach proper, administrative agencies could effectively repeal legislative rules and abandon longstanding interpretations of statutes indirectly, by adjudication, without providing affected parties any opportunity to comment on the proposed changes, and without providing any significant explanation for their departure from their established views. [34] Indeed, this is precisely what happened in this case. The FLRA issued a brief opinion affirming the ALJ’s unpublished decision and providing no discussion whatever of the significance of the Authority’s long-standing stay regulation. Since that time, the Authority has apparently cited its opinion in this case in orders denying stay requests, implicitly inviting agencies not to comply with arbitration awards[36] even though the agency has not rescinded or modified the existing stay regulation.[37] In short, the Authority has effectively emasculated its own regulation by means of a brief, summary opinion that fails even to mention the significance of the long-standing stay regulation, much less to provide a coherent justification of the Authority’s abandonment of the statutory interpretation embodied in that regulation. [35] The FLRA’s decision in this case does not qualify as reasoned decisionmaking. The FLRA is entitled to seek to alter its established regulation and interpretation of section 7122(b), which, as we have noted,[38] is sufficiently ambiguous to permit both the FLRA’s traditional construction and its newly advanced one. But if it wishes to do so, the Authority will have to proceed openly and directly, by following established rulemaking procedures, rather than indirectly by means of an adjudication that ignores its own rules and precedents. Accordingly, the FLRA’s order is vacated and
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the case is remanded for further proceedings consistent with this opinion.
[36] So OrderedIf no exception to an arbitrator’s award is filed under subsection (a) [5 U.S.C. § 7122(a)] during the 30-day period beginning on the date of such award, the award shall be final and binding. An agency shall take the actions required by an arbitrator’s final award.
See also, 5 C.F.R. § 2425.1(b) (1982). Subsequent to the events recounted in this opinion Congress amended the statute to provide that the 30-day period would run from the date on which the arbitrator’s award was served on the party filing exceptions, Pub.L. 98-224 § 4, 98 Stat. 48 (1984), 5 U.S.C.A. § 7122(b) (1979 and Supp. 1985), and the FLRA amended its regulations accordingly. See 5 C.F.R. § 2425.1(b) (1985).
(a) A request for a stay shall be entertained only in conjunction with and as a part of an exception to an arbitrator’s award filed under Part 2425 of this subchapter. The filing of an exception shall not itself operate as a stay of the award involved in the proceedings.
(b) A timely request for a stay of an arbitrator’s award shall operate as a temporary stay of the award. Such temporary stay shall be deemed effective from the date of the award and shall remain in effect until the Authority issues its decision and order on the exception, or the Authority or its designee otherwise acts with respect to the request for the stay.
(c) A request for a stay of an arbitrator’s award will be granted only where it appears, based upon the facts and circumstances presented, that:
(1) There is a strong likelihood of success on the merits of the appeal; and
(2) A careful balancing of all the equities, including the public interest, warrants issuance of a stay (emphasis added).
. . . it shall be an unfair labor practice (1) to interfere with, restrain, or coerce any employee in the exercise by the employee of any right under this chapter; . . .
* * * * * *
(8) to otherwise fail or refuse to comply with any provision of this chapter.
(D.C. Cir. 1982).
(D.C. Cir. 1984).
However, our review of the relevant legislation and of the record in this case persuade us that this case is not moot. In addition to issuing a cease and desist order upon a finding of an unfair labor practice, the FLRA is authorized to order “such other action as will carry out the purpose” of the Federal Labor-Management Relations Act. 5 U.S.C. § 7118(a)(7)(D); 5 C.F.R. § 2423.29. This “other action” may include the posting of a notice indicating that an agency has been found to have committed an unfair labor practice and that it has been ordered to cease committing such practices in the future. See American Federation of Governmental Employees v. FLRA, 716 F.2d 47, 51
(D.C. Cir. 1983) (per curiam). An order requiring the Home to post such a notice would of course afford petitioner an as yet unrealized remedy for the alleged unfair labor practice. The existence of this additional remedy, and this court’s concomitant ability to afford petitioner relief beyond that already obtained, establishes that a live controversy still exists between the parties and that this case is therefore not moot. See Doe v. Harris, 696 F.2d 109, 112 (D.C. Cir. 1982). See also, FLRA v. Social Security Administration, 753 F.2d 156, 162-63
(D.C. Cir. 1985).