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Parties Involved:
Federal Labor Relations Authority
Respondent
National Treasury Employees Union
Petitioner

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 12, 2004 Decided December 17, 2004

No. 03-1423

NATIONAL TREASURY EMPLOYEES UNION,

PETITIONER

V.

FEDERAL LABOR RELATIONS AUTHORITY,

RESPONDENT

On Petition for Review of an Order of the

Federal Labor Relations Authority

Julie M. Wilson was on the brief for petitioner. With her on

the briefs were Gregory O'Duden and Barbara A. Atkin.

David M. Shewchuk, Attorney, Federal Labor Relations

Authority, argued the cause for respondent. With him on the

brief were David M. Smith, Solicitor, and William R. Tobey,

Deputy Solicitor. James F. Blandford, Attorney, entered an

appearance.

Before: SENTELLE, HENDERSON, and ROBERTS, Circuit

Judges.

Opinion for the Court filed by Circuit Judge SENTELLE.

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SENTELLE, Circuit Judge: The National Treasury

Employees Union (“NTEU”) petitions for review of the Federal

Labor Relations Authority’s (“FLRA”) decision dismissing

NTEU’s unfair labor practice complaint as untimely.

Specifically, the FLRA found that the statutory filing period for

an unfair labor practice charge challenging the failure to comply

with an arbitrator’s award begins as soon as the award becomes

final. NTEU contends that this interpretation is contrary to the

clear language of the statute and thus is due no deference.

Because we agree with the NTEU we grant the petition for

review.

I. Background 

A. Statutory Background

This case arises from the Internal Revenue Service’s

(“IRS”) alleged violation of an arbitrator’s award for an unfair

labor practice. The Federal Labor Relations Authority

(“Authority”) was created and is governed by the Federal

Service Labor-Management Relations Statute (“FSLMRS”), 5

U.S.C. §§ 7101-7135, to regulate labor-management relations

for the federal government. The FSLMRS provides procedures

governing the arbitration of labor-management disputes that

ensure that arbitration awards are subject to review and are

obeyed once upheld by the Authority. 

Once an arbitrator grants an award, parties have a 30-day

window to file exceptions with the Authority. 5 U.S.C. § 7122.

If no exceptions are filed, the award becomes final and binding

at the end of that period. Id. As soon as the award is final the

agency must take actions required by the award; failure to do so

constitutes an unfair labor practice (“ULP”). Id.; 5 U.S.C. §

7116(a)(8). 

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An aggrieved party may make a charge of an unfair labor

practice to the General Counsel, who may then issue a complaint

against the agency or union for the ULP. 5 U.S.C. § 7118(a)(1).

A statute of limitations applies to these charges: “no complaint

shall be issued based on any alleged unfair labor practice which

occurred more than 6 months before the filing of the charge with

the Authority.” 5 U.S.C. § 7118(a)(4)(A). This statute of

limitations may be tolled if the ULP was not discovered during

the six-month period due to concealment. 5 U.S.C. §

7118(a)(4)(B). The Authority also has permitted equitable

tolling of the period in unique circumstances where multiple

timely charges were made but dismissed or withdrawn for

various reasons. Dep’t of the Air Force, HQ 832d Combat

Support Group, DPCE Luke Air Force Base, Ariz., 24 F.L.R.A.

1021, 1025-26 (1986) (“Luke AFB”) (citingBurnett v. New York

Cent. R.R. Co., 380 U.S. 424, 428-429 (1965) (applying

equitable tolling where plaintiff had not “slept on his rights”)).

B. Factual Background

The NTEU is the exclusive representative of a nationwide

consolidated unit of IRS employees. During fiscal year 1998 the

IRS directed certain employees from the surrounding area to

report periodically to the Seattle Headquarters, resulting in

increased commuting times for these employees. NTEU filed

grievances on their behalf seeking compensation, the IRS

refused to pay, and the matter proceeded to arbitration. The

arbitrator’s award sustained the grievance, ordered the IRS to

start compensating employees for increased commuting time,

and required the IRS to compile a list of employees who had

been affected by these assignments for the purpose of assessing

the remedy (presumably an award of back-pay). The list was to

be due within 45 days of the receipt of the award.

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C. Proceedings Below

The IRS filed exceptions to the award which the Authority

denied on August 17, 2001. Dep’t of the Treasury, I.R.S., and

Nat’l Treasury Employees Union, 57 F.L.R.A. 444 (2001). It

then filed a motion for reconsideration that was denied on

November 27, 2001. Dep’t of the Treasury, I.R.S., and Nat’l

Treasury Employees Union, 57 F.L.R.A. 592 (2001). The

NTEU contacted the IRS to determine whether it intended to

comply with the award, but the IRS responded that it did not

have definite information because the matter was still being

reviewed by the Department of the Treasury. In order to obtain

a clearer answer, counsel for NTEU wrote a letter to IRS Area

Counsel on January 24, 2002 because more than 45 days had

elapsed since the motion for reconsideration was denied and the

IRS had not yet provided an employee list. The Area Counsel

responded in a letter dated January 31, 2002, stating that the

agency “does not have to take any action to implement the

Arbitrator’s award at this time.” The NTEU filed a ULP charge

on February 21, 2002, charging that the IRS had violated 5

U.S.C. § 7116(a)(1) and (8) by refusing to comply with the

award.

The FLRA General Counsel issued a complaint and filed a

motion for summary judgment; the IRS cross-moved for

summary judgment arguing that the charge was untimely filed

under § 7118(a)(4)(A). The Administrative Law Judge (“ALJ”)

held that the six-month period for filing had begun when the

award was final, on August 17, 2001, and therefore had expired

on February 17, 2002. Dep’t of the Treasury, I.R.S., and Nat’l

Treasury Employees Union, 59 F.L.R.A. 282, 295 (2003).

Because the charge was filed on February 21, 2002 and he found

no reason to equitably toll the period, the ALJ held that the

charge was untimely filed and dismissed the matter. The

Authority affirmed the ALJ’s conclusions. Id. at 288-89. NTEU

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filed this petition for review.

II. Analysis

Review of the FLRA's interpretation of its own enabling

statute is governed by the familiar two-step test of Chevron

USA, Inc. v. Natural Resources Defense Council, Inc., 467 U.S.

837 (1984). Dep't of the Air Force v. FLRA, 294 F.3d 192, 196

(D.C. Cir. 2002). When Congress has spoken, we are bound by

that pronouncement and that ends this Court's inquiry. Chevron,

467 U.S. at 842-43. Where “the statute is silent or ambiguous

with respect to the specific issue, the question for the court is

whether the agency's answer is based on a permissible

construction of the statute.” Id. at 843. In this case the

Authority’s interpretation of the statutory filing period for ULP

charges runs contrary to the clearly expressed intent of Congress

and fails Chevron at its first step. 

Under § 7118(a)(4), the six-month filing period for ULP

charges starts at the time the “alleged unfair labor practice . . .

occurred.” In this case the alleged ULP consisted of the failure

to comply with the arbitrator’s award. See 5 U.S.C. §§

7116(a)(8), 7118(a)(4)(A). The plain language of the statute

thus requires that the filing period cannot begin at least until

there has been a failure to comply with an arbitration award.

 

The Authority argues that, because the agency has an

obligation to comply with an award as soon as it becomes final,

5 U.S.C. § 7122(b), and because the IRS never took the actions

mandated by the award, the failure to comply occurred when the

award became final on August 17, 2001. This reading confuses

the onset of the obligation with the onset of the failure to fulfill

that obligation. If an award orders an action that will take place

in the future, a party may fail to comply with the award in two

ways. First, it may expressly reject its obligation under the

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award at any time. Second, it may simply not take the steps

ordered by the award, but it cannot be said to have done this at

least until the deadline for taking action has passed. 

In the case before us, the arbitrator’s award imposed two

major obligations on the IRS. First, it enjoined the IRS from

“failing or refusing to implement [commuting compensation

under the collective bargaining agreement] as to covered

employees.” Nothing on the record indicates whether the IRS

complied with this section of the agreement. The second

obligation thus forms the basis for the ULP charge: the IRS was

required to submit a list of employees affected by the location

transfers so that they could be compensated. This list was due

on October 1, 2001, 45 days after the award became final. Thus

the first opportunity for the IRS to fail to comply with the award

was on October 1, when it missed the deadline to submit names

to NTEU. It is impossible to find an unfair labor practice

occurring before this point because there cannot have been a

failure to comply with the award before then. While the IRS

arguably could have triggered the limitations period earlier by

affirmatively rejecting its obligations under the award, it did not

do so until IRS Area Counsel wrote as much to NTEU’s counsel

on January 31, 2002. 

Given the facts of this case, then, the earliest possible date

that a ULP can be said to have occurred is October 1, 2001.

Because NTEU’s charge was filed on February 21, 2002, it was

well within the six-month filing period and was timely. 

The Authority characterizes NTEU’s interpretation of the

filing period as a “discovery rule.” Under a discovery rule, “a

cause of action accrues when the injured party discovers--or in

the exercise of due diligence should have discovered--that it has

been injured.” Sprint Comm. Co., L.P. v. FCC, 76 F.3d 1221,

1228 (D.C. Cir. 1996). NTEU’s interpretation is not such a rule.

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The period begins running in October not because that is the

first time NTEU could have known that the IRS was failing to

comply with the award, but because that was the first time the

IRS could have failed to comply by inaction.

 

If we were to accept the Authority’s interpretation, we

would be left with the absurd situation of charges that could

never be filed because the limitations period would expire

before they became ripe. If, for example, an arbitrator’s award

on January 1 required the agency to take action within seven

months after the award became final, a charge of inaction would

not be ripe until seven months later on August 1. But under the

Authority’s interpretation the limitations period would start

running as soon as the award became final, making the period

expire six months later on July 1 – before the claim became

ripe. This is neither supported by the statutory language that

requires that a ULP actually occur before the limitations period

can begin to run, nor is it a workable policy. 

III. Conclusion

For the reasons given above we grant the petition for

review, vacate the decision below, and remand for further

proceedings. 

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