Thirty-four years – promoting and protecting labormanagement relations for effective, efficient government.

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U.S. FEDERAL LABOR RELATIONS AUTHORITY

PERFORMANCE AND ACCOUNTABILITY REPORT
UNITED STATES

FEDERAL LABOR RELATIONS AUTHORITY

Performance and Accountability Report

FISCAL YEAR 2013
TABLE OF CONTENTS

MESSAGE FROM THE CHAIRMAN .................................................................1

MANAGEMENT’S DISCUSSION AND ANALYSIS .........................................3

Background and Mission .................................................................................................................3

Organizational Structure ..................................................................................................................3

Strategic and Performance Planning Framework ............................................................................6

Performance Summary...................................................................................................................11

Financial Analysis..........................................................................................................................19

Management Assurances ...............................................................................................................22

PERFORMANCE GOALS AND RESULTS......................................................23

Goal 1: Provide Timely Review and Disposition of Unfair Labor Practice Cases.......................23

Goal 2: Provide Timely Review and Disposition of Representation Cases..................................25

Goal 3: Provide Timely Review and Disposition of Arbitration Cases........................................26

Goal 4: Provide Timely Review and Disposition of Negotiability Cases ....................................27

Goal 5: Provide Timely Review and Disposition of Bargaining Impasse Cases..........................28

Goal 6: Use Collaboration Techniques and Alternative Dispute Resolution Services to

Minimize and/or Resolve Labor-Management Disputes..................................................29

Goal 7: Modernize Agency Information Technology Business Systems to Support and

Enhance Program Achievement .......................................................................................31

Goal 8: Develop, Manage, and Utilize the FLRA’s Human Capital to Meet Program Needs.....32

Verification and Validation of Performance Data .........................................................................34

PRINCIPAL FINANCIAL STATEMENTS .......................................................35

Message from the Chief Financial Officer.....................................................................................35

Balance Sheet.................................................................................................................................36

Statement of Net Cost ....................................................................................................................37

Statement of Changes in Net Position ...........................................................................................38

Statement of Budgetary Resources................................................................................................39

Notes to the Financial Statements..................................................................................................40

Report of Independent Auditors.....................................................................................................50

OTHER ACCOMPANYING INFORMATION.................................................53

Summary of Financial Statement Audit.........................................................................................53

Summary of Management Assurances...........................................................................................53

Memorandum on Inspector General Identified Management Challenges.....................................54

Management’s Response ...............................................................................................................58

Improper Payments Elimination and Recovery .............................................................................58
1

MESSAGE FROM THE CHAIRMAN

I am pleased to present the U.S. Federal Labor Relations Authority’s (FLRA) 

Performance and Accountability Report for Fiscal Year (FY) 2013. As I 

discuss in more detail below, FY 2013 presented virtually unprecedented 

challenges for the FLRA. To begin, each component of the FLRA – the 

Authority, the Office of the General Counsel (OGC), and the Federal Service 

Impasses Panel (FSIP) – experienced an increase in case filings. At the same 

time, the FLRA’s FY 2013 funding level, which like other agencies was 

reduced significantly by sequestration, coupled with uncertainty about the FY 

2014 funding level, impaired the agency’s ability to fill key vacancies. These vacancies spanned 

across the agency, including case processing offices as well as the operational offices – Budget 

and Finance, Human Resources, Information Technology, and Administrative Services – which 

provide vital support services to ensure the basic functioning of the agency. And, perhaps most 

significantly, the Authority component lacked a quorum of Members from January 3, 2013, 

through the remainder of the fiscal year. This lack of quorum legally prevented the Authority 

component from discharging its key obligation under law: to issue decisions resolving labormanagement disputes filed under the Federal Service Labor-Management Relations Statute (the 

Statute).

These challenges, individually and collectively, posed obstacles to the agency’s ability to do its 

work effectively. And that work is critically important to the effectiveness and efficiency of the 

federal government as a whole. This is because the FLRA’s mission is to assist agencies, 

employees, and employee representatives to resolve disputes in order to effectuate the 

implementation of improvements in government operations and mission performance. We are 

committed to fostering a productive and effective federal government, providing leadership in 

establishing policies and guidance related to federal sector labor-management relations, and 

ensuring compliance with the Statute.

And I am proud to report that, in many respects, the FLRA was able to both overcome its 

obstacles and to excel in its performance. In particular, despite an increase in case filings, the 

OGC exceeded its performance goal for timely resolution of unfair labor practice (ULP) cases by 

8 percent. And the FSIP, which experienced its fifth straight year of increased case filings, 

including 40 cases concerning agency sequestration-related decisions to furlough employees, 

continued to obtain high rates of settlement, including a settlement rate of nearly 65 percent of 

cases in which mediation-arbitration was used. Moreover, the agency’s use of alternative dispute 

resolution (ADR) techniques (at every step and in every component) continued to set the 

standard in the federal government. As an example, the FLRA’s Collaboration and Dispute 

Resolution Office (CADRO) – a one-employee office during FY 2013 – partially or totally 

resolved 100 percent of negotiability cases that the parties agreed to submit to the CADRO. 

Similarly impressive, the OGC resolved 98 percent of the ULP cases and 100 percent of the 

representation cases in which parties agreed to use ADR. Further, nearly 6,000 labor and 

management representatives, and others, participated in training, outreach, and facilitation 

activities. The FLRA’s training and other initiatives have remained critical to the 

implementation and ongoing success of President Obama’s Executive Order 13522, Creating 

Labor-Management Forums to Improve Delivery of Government Services.
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Significant accomplishments were made outside the case arenas as well. Among other things, 

the FLRA continued refining its eFiling system (available in all components) and made strides 

toward inaugurating end-to-end electronic case files. The FLRA also implemented its first 

Diversity & Inclusion (D&I) Strategic Plan, including metrics for measuring D&I success, and 

successfully launched a web-based time and attendance system to more efficiently capture 

employee time and attendance. 

Sustaining the dramatic increases in employee morale and satisfaction accomplished since 2009,

the FLRA was recognized in FY 2013 by the Partnership for Public Service in its Federal 

Leadership Snapshot as the #3 small agency for its effective leadership in the federal 

government. And even though FLRA employees faced significant challenges, they continued to 

feel “engaged,” as evidenced by the results of the Office of Personnel Management’s 2013 

Federal Employee Viewpoint Survey. Consistent with the government-wide results, the agency 

showed a decline in certain aspects of the survey. But the agency also showed real strengths. In 

particular, more than 90 percent of responses demonstrated that FLRA employees know how 

their work relates to the agency’s goals and priorities; are being held accountable for achieving 

results; believe the overall quality of the work performed within their office is high; and feel the 

work they do is important. 

In contrast to these noteworthy achievements, the Authority component was unable to issue 

decisions for the last nine months of the fiscal year because it lacked a quorum of Members. As 

a result, the Authority ended FY 2013 with 153 pending cases – a 206 percent increase over the 

number pending at the end of FY 2012 (50). And, understandably, the pending inventory 

included many overage cases (27). This is particularly disheartening, since at the end of FY 

2012, the Authority satisfied its Corrective Action Plan by completely eliminating its overage 

inventory. This also means that the Authority component’s reporting that it met or exceeded its 

performance goals for the fiscal year presents an incomplete picture. In particular, those results 

apply only to performance during the first three months of the fiscal year in which the Authority

was able to issue decisions. The cases that accumulated during the last nine months of the year 

present yet another challenge.

Mindful that challenges can become opportunities, I am hopeful that, in full partnership with 

Presidential leadership, career managers, employees, and the employees’ representative union, 

we will find ways to meet our challenges head-on and to collaborate with the goal of improved 

and sustainable performance excellence throughout the FLRA. I am convinced that agency 

achievements and improvements are possible only with full engagement of employees in the 

transparent development and implementation of goals. I was guided by this principle during my 

previous Chairmanship, and will continue to be guided by it in the short and long term.

Carol Waller Pope

Chairman

Federal Labor Relations Authority

December 16, 2013
3

MANAGEMENT’S DISCUSSION AND ANALYSIS

BACKGROUND AND MISSION

The U.S. Federal Labor Relations Authority (FLRA) is responsible for establishing policies and 

guidance regarding the labor-management relations program for 2.1 million non-Postal, federal 

employees worldwide, approximately 1.2 million of whom are represented in 2,200 bargaining

units. The FLRA was created by Title VII of the Civil Service Reform Act of 1978, also known 

as the Federal Service Labor-Management Relations Statute (the Statute). The agency’s real 

genesis, however, dates from the issuance of Executive Order 10988 by President Kennedy in 

1962. In 2012, the FLRA celebrated the 50th anniversary of the Order, which established the 

first government-wide, labor-management relations program within the federal government. In 

1970, President Nixon established the Federal Labor Relations Council by Executive Order 

11491 to administer the federal labor-management relations program and to make final decisions 

on policy questions and major disputes arising under Executive Order 10988. Executive Order 

11491, as amended, was the basis for President Carter’s proposal to Congress to create the FLRA 

as an independent agency.

The Statute protects the rights of federal employees to form, join, or assist a labor organization or 

to refrain from such activity freely and without fear of penalty or reprisal. These rights include

acting for a labor organization as a representative and, in that capacity, presenting the views of 

the organization. Employees also have the right to engage in collective bargaining with respect 

to conditions of employment through representatives chosen by the employees.

The mission of the FLRA is to promote stable, constructive labor-management relations in the 

federal government by resolving and assisting in the prevention of labor-management disputes in 

a manner that gives full effect to the collective-bargaining rights of employees, unions, and 

agencies. Although the FLRA is a small agency, accomplishing its mission, including the 

timely, quality resolution of disputes, is essential for program performance government-wide. If 

a labor-management dispute remains unresolved for too long, then mission accomplishment 

likely will suffer.

ORGANIZATIONAL STRUCTURE

The FLRA consists of the Authority, the Office of the General Counsel, and the Federal Service 

Impasses Panel. The agency also provides full staff support to two other organizations, the 

Foreign Service Impasse Disputes Panel and the Foreign Service Labor Relations Board.
4

U.S. Federal Labor Relations Authority

The Authority

The Authority is composed of three full-time Members appointed by the President with the 

advice and consent of the Senate. The Members are appointed for five-year, staggered terms and 

one Member is designated by the President to serve as Chairman, who acts as the agency’s chief 

executive and administrative officer. The Authority is empowered to: resolve disputes over the 

negotiability of proposals made in collective bargaining; decide whether conduct alleged in a 

complaint constitutes an unfair labor practice (ULP); resolve exceptions to grievance arbitration 

awards; and review the decisions of Regional Directors in representation disputes over union 

elections and unit determinations.

The Authority Members appoint Administrative Law Judges (ALJs) to hear and prepare 

recommended decisions in cases involving alleged ULPs, as well as decisions involving 

applications for attorney fees filed pursuant to the Back Pay Act or the Equal Access to Justice 

Act. The Office of the Administrative Law Judges (OALJ) also provides settlement 

opportunities in all ULP cases. Decisions of the ALJs may be appealed to the Authority.

The Office of the Solicitor represents the FLRA in court proceedings before all United States 

courts, including the U.S. Supreme Court, U.S. Courts of Appeals, and Federal District Courts. 

In this connection, parties aggrieved by certain Authority decisions may institute an action for 

FOREIGN

SERVICE

LABOR

RELATIONS

BOARD

FOREIGN

SERVICE

IMPASSE

DISPUTES PANEL

AUTHORITY

MEMBERS

(2)

FEDERAL

SERVICE

IMPASSES

PANEL

GENERAL

COUNSEL

CHIEF COUNSEL 

TO THE 

CHAIRMAN

CHIEF COUNSELS

(ONE TO EACH

MEMBER)

& STAFF

COLLABORATION

AND

ALTERNATIVE

DISPUTE

RESOLUTION

OFFICE

REGIONAL

OFFICES

(7)

OFFICE OF THE

EXECUTIVE

DIRECTOR

OFFICE OF THE

SOLICITOR

OFFICE OF THE

ADMINISTRATIVE

LAW JUDGES

OFFICE OF THE

INSPECTOR

GENERAL

EQUAL

EMPLOYMENT

OPPORTUNITY

PROGRAM

OFFICE OF CASE 

INTAKE

AND

PUBLICATION 

OFFICE

HUMAN

RESOURCES

DIVISION

ADMINISTRATIVE

SERVICES

DIVISION

INFORMATION

RESOURCES

MANAGEMENT

DIVISION

BUDGET AND

FINANCE

DIVISION

AUTHORITY 

CHAIRMAN AND 

CHIEF 

EXECUTIVE 

OFFICER
5

judicial review within 60 days after the decision issues. The Authority may also seek 

enforcement of its orders, temporary relief, or restraining orders in the appropriate U.S. Courts of 

Appeals or Federal District Courts. The Office of the Solicitor also serves as the agency's inhouse counsel, providing legal advice to all FLRA components, and performs various functions 

under the Freedom of Information Act and Privacy Act. The Solicitor also serves as the 

Designated Agency Ethics Official.

The Office of the Inspector General provides independent and objective assessments of the 

FLRA’s efficiency, effectiveness, and compliance with laws and regulations. This is 

accomplished through proactive evaluations of agency operational processes. In addition to 

striving to prevent and detect fraud, waste, and abuse of the FLRA’s resources and operations, a 

key goal of the Inspector General is to serve as a catalyst for improving operations and 

maximizing the efficiency and integrity of agency programs.

In fulfilling these responsibilities and objectives, the Inspector General conducts and supervises 

investigations, internal reviews, audits, and evaluations of the programs and operations of the 

agency. The Inspector General communicates the results of investigations and assessments to 

FLRA management, the Congress, other oversight entities, and the public as appropriate. 

Generally, results are communicated in formal reports and contain findings and 

recommendations aimed at correcting any deficiencies identified and promoting efficiency and 

effectiveness in agency programs and operations. The Inspector General also manages a hotline 

to provide employees and the public with a direct means for communicating information on 

potential fraud, waste, or abuse.

The Office of the General Counsel

Appointed for a five-year term by the President with the advice and consent of the Senate, the 

General Counsel has independent statutory responsibility for investigating ULP charges and for 

filing and prosecuting ULP complaints. Pursuant to the Statute, the General Counsel has direct 

authority over, and responsibility for, all employees in the Office of the General Counsel (OGC), 

including those in the regions. The Regional Offices, on behalf of the General Counsel, 

investigate and resolve alleged ULPs, file and prosecute ULP complaints, and provide training 

and alternative dispute resolution (ADR) services. In addition, through delegation by the 

Authority, the Regional Offices process representation petitions and conduct secret ballot 

elections.

The General Counsel has a small staff in FLRA Headquarters, located in Washington, DC. 

Headquarters management staff provides administrative oversight; develops policies, guidance, 

procedures, and manuals that provide programmatic direction for the OGC’s seven Regional 

Offices and training and education for the parties; and processes appeals from dismissal of ULP 

charges. Each Regional Office has a Regional Director who provides leadership and 

management expertise for the respective region.
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The Federal Service Impasses Panel

The Federal Service Impasses Panel (FSIP or the Panel) resolves impasses between federal 

agencies and unions representing federal employees arising from negotiations over conditions of 

employment under the Statute and the Federal Employees Flexible and Compressed Work 

Schedules Act. The Chairman and six other Members of the Panel are appointed by the 

President for five-year terms. If bargaining between the parties, followed by mediation 

assistance, does not result in a voluntary agreement, then either party or the parties jointly may 

request the FSIP’s assistance.

Following a preliminary investigation by its staff, the Panel may determine to assert jurisdiction 

over the request. If jurisdiction is asserted, then the FSIP has the authority to recommend and/or 

direct the use of various ADR procedures. These include informal conferences, additional 

mediation, fact-finding, written submissions, and mediation-arbitration by Panel Members, the 

Panel’s staff, or private arbitrators. If the parties still are unable to reach a voluntary settlement, 

then the FSIP may take whatever action it deems necessary to resolve the dispute, including 

imposition of contract terms through a final action. The merits of the FSIP’s decision may not be 

appealed to any court.

STRATEGIC AND PERFORMANCE PLANNING FRAMEWORK

Over the last four and a half years, through an on-going, comprehensive, agency-wide review of 

its operations, staffing, work processes, resource allocations, and performance by agency 

leadership and the Union of Authority Employees – the employees’ representative organization –

the FLRA has strategically planned for its future, and has established aggressive and challenging 

mission initiatives and performance indicators, maximizing the delivery of agency services 

throughout the federal government. The agency has continually improved its program 

performance by assessing and evaluating its performance outcomes to ensure that it is 

Atlanta Regional 

Office

Boston Regional 

Office

Chicago Regional 

Office

Dallas Regional 

Office

Denver Regional 

Office

San Francisco 

Regional Office

Washington DC 

Regional Office
7

accomplishing its important mission of providing guidance in resolving labor-management 

disputes in the federal sector. 

The FLRA’s performance planning framework is based on the FY 2010 – 2015 Strategic Plan, 

and is supported by the Annual Performance Plan. The FLRA Performance Plan reflects the 

agency’s commitment to establishing measures that will enable it to assess performance 

outcomes, align resources, and effectively identify staffing and training needs for future years. 

The agency performance plan also demonstrates the FLRA’s on-going commitment to 

organizational excellence.

FLRA Strategic Goals

1. Achieve superior customer service.

2. Develop leaders at every level to meet goals and position the agency for the future.

3. Advance performance through organizational and management excellence.

4. Develop, empower, and engage FLRA employees to meet program needs and improve job 

satisfaction.

The FLRA seeks to achieve its strategic goals primarily through the timely review and 

disposition of cases. The agency supplements these efforts with a focus on reducing litigation 

and its attendant costs by helping parties resolve their own disputes through collaboration, ADR,

and labor-management cooperation activities. These efforts are further supported by the FLRA’s 

focus on internal improvements in information technology (IT) and more effective and efficient 

use of human capital.

FY 2013 Performance Goals

1. Provide timely review and disposition of unfair labor practice cases.

2. Provide timely review and disposition of representation cases.

3. Provide timely review and disposition of arbitration cases.

4. Provide timely review and disposition of negotiability cases.

5. Provide timely review and disposition of bargaining impasse cases.

6. Use collaboration techniques and alternative dispute resolution services to minimize and/or 

resolve labor-management disputes.

7. Modernize agency information technology business systems to support and enhance 

program achievement.

8. Develop, manage, and utilize the FLRA’s human capital to meet program needs.

Timeliness

Improvements in the timeliness of case disposition further the FLRA’s critical role in facilitating

orderly, efficient, and effective change within the federal government. The core purpose of the

Statute is to promote collective bargaining as a means of fostering improved employee 

performance and government operations. It is clear that productive and effective labor-
8

management relations are necessary for designing and implementing the comprehensive changes 

required to reform government, and that effective labor-management relations are dependent on 

both the timely resolution of disputes and the engagement of federal employees and their union 

representatives as essential sources of front-line ideas and information about improvements in the 

delivery of government services.

The FLRA facilitates improvements in performance government-wide that will inevitably have an 

impact on employee working conditions and implicate the bargaining rights of the more than 1.2 

million employees represented by a labor organization. Unless management and labor can reach

timely agreements or, failing that, have their disagreements resolved expeditiously, mission 

performance will suffer. This is particularly relevant now as federal agencies are making 

significant adjustments and changes in how they perform their missions in response to the 

budgetary and policy challenges that they are facing.

Alternative Dispute Resolution and Education

Throughout the years, the Authority, the OGC, and the FSIP, recognizing the tremendous benefits 

and cost-savings associated with using ADR to resolve workplace disputes, have integrated ADR 

techniques into all aspects of their case processing. Offering ADR services in pending ULP, 

representation, negotiability, and bargaining impasse disputes at every step – from investigation 

and prosecution to the adjudication of cases and resolution of bargaining impasses – results in 

parties having faster, mutually agreeable, and effective resolution of their disputes. More than 15 

years ago, the FLRA established the Collaboration and Alternative Dispute Resolution Program to 

place even greater and more formalized emphasis on the use of ADR in the agency.

Throughout the years, all of the FLRA’s offices – the Collaboration and Alternative Dispute 

Resolution Office (CADRO), the OGC, the FSIP, and the OALJ – have successfully 

conducted interventions and engaged in settlement efforts in thousands of cases pending before the 

agency. In well over 80 percent of FLRA cases in FY 2013, these activities resulted in full 

resolution of the underlying dispute and closure of the pending case. To date, the FLRA has 

leveraged existing staff and resources to increase its ADR reach, partnering with other agencies –

such as the Federal Mediation and Conciliation Service and the Veterans Administration – to train 

large numbers of practitioners, and supporting labor-management forums pursuant to Executive 

Order 13522, Creating Labor-Management Forums to Improve Delivery of Government Services.

In addition, the FLRA’s training initiative is intended to make case processing more effective and 

efficient and to better serve agency customers by providing meaningful and clear guidance on 

statutory rights and responsibilities. Timely and efficient case processing is furthered by FLRA 

customers being knowledgeable about their rights and obligations under the Statute, as well as 

agency case law, regulations, and case processing procedures. The FLRA delivers its educational 

materials through a variety of means – in-person training sessions, on-line meetings and training 

sessions, and various on-line resources – such as comprehensive web-based training modules, as 

well as outlines, manuals and guides developed to assist members of the federal labor-management 

relations community with issues and cases arising under the Statute. Using collaboration and ADR 

techniques along with other training, outreach, and facilitation services to assist parties in 

minimizing and resolving labor-management disputes significantly reduces the need for litigation 
9

and its attendant costs, and gets the parties back to work accomplishing their missions and 

delivering effective and efficient government services.

Information Technology

IT and automation are fundamental to ensuring the efficiency and effectiveness of the FLRA and

in meeting the agency’s performance goals. The agency continues to improve its efficiency and 

the customer-service experience by engaging in new and innovative ways to conduct business, 

such as implementing electronic case filing (eFiling). The FLRA’s eFiling system, which was 

developed to provide easier, more user-friendly, and complete access to the FLRA and its 

services, is an important e-government initiative. More specifically, eFiling is expected to 

increase efficiency over time by reducing procedural-filing errors and resulting processing 

delays, and is yet another example of the FLRA’s ongoing efforts to better serve its customers 

and provide current, useful online tools for federal employees, the unions that represent them, 

and federal agencies for resolving issues under the Statute. The system will also provide the 

platform for agency development of an “end-to-end” electronic case file.

The FLRA’s ADR intervention efforts in pending negotiability cases have also been greatly 

enhanced through the use of technology, allowing staff to resolve large, complex negotiability 

cases with minimal cost. For example, the CADRO used Adobe Connect and other appropriate 

collaborative technology tools to enable video and audio conferencing, document sharing, and 

other functions for remote parties. As a result, the CADRO was able to successfully resolve 

disputes that involved parties who were in remote locations (including various locations in 

Alaska) without requiring either the CADRO representatives or the party representatives to 

travel. This innovative use of technology for parties in remote locations enabled the parties (and 

the FLRA) to achieve faster and higher-quality resolutions, while also resulting in significant 

savings to both the FLRA and the participating parties, and contributing to the efficient and 

effective accomplishment of the agency’s mission.

The FSIP also relies heavily on technology to increase efficiency in resolving cases. During FY 

2013, consistent with the practice it has adopted in previous years, the Panel conducted five of its 

eight business meetings via teleconference, linking Panel Members in the Chicago and Detroit 

areas with their colleagues and staff in Washington, DC, saving thousands of dollars in travel

and per diem expenses. In addition, Panel Members routinely conducted mediation-arbitration 

proceedings by telephone and/or video conference where on-site visual inspection of a facility 

was unnecessary to resolve impasses, avoiding the need for a Panel Member to travel to the 

location of a dispute or for the parties to send their representatives to the Panel’s offices.

Moreover, the OGC has incorporated technology into all aspects of its ULP and representation 

case investigations. The OGC frequently uses telephone and video conferencing in case 

investigations and settlement discussions. When voters are dispersed in a representation case 

election, for example, the OGC uses internet/telephone balloting procedures providing 

employees with around-the-clock access to voting. The office also uses video and telephone 

conferencing in representation case hearings involving remote or unavailable witnesses. 
10

In addition, the OGC has established a variety of web-based interactive training programs for the 

parties addressing such frequently raised topics as basic rights and responsibilities under the 

Statute, the impact of reorganizations on bargaining units, the statutory exclusions from 

bargaining units, and Executive Order 13522. The OGC has also established comprehensive, 

web-based case outlines for ULP and representation cases to go along with its operating 

manuals, policies, and guidance memoranda. These on-line materials provide the parties with 

ready access to the same materials that office staff rely on to process cases, promoting 

transparency and efficiency in the investigative process.

The agency has used technology in delivering other services as well. For example, all government 

agencies look to the FLRA as one of the lead training agencies concerning Executive Order 13522, 

and the OGC and the CADRO have helped them overcome some of the initial hurdles of 

implementation. In FY 2013, the FLRA assisted representatives from labor and management that 

were dispersed in many locations across 1,500 miles. As a precursor to face-to-face meetings, the 

CADRO office hosted an online meeting that enabled more than a dozen key leaders to obtain 

some basic training concerning the Order, share critical information, identify barriers preventing 

forward movement, agree to develop a labor-management forum charter, and schedule future 

meetings. As a result, communications were enhanced, travel costs were reduced, and the parties’ 

collaborative labor-management relationship strengthened. The parties are working together to 

develop ways to improve their mission performance.

Human Capital

The FLRA has made major gains in improving all aspects of employee work-life balance and in 

leveraging its highly engaged workforce to address agency matters ranging from the strategies 

and processes for the delivery of program services to internal agency operations, including

performance management, IT, budgetary resources, and office space. Continuing its 

commitment to communicating and involving employees in mission performance and agency 

operations, the FLRA has established a true link between employee engagement and agency 

performance outcomes. 

Employee feedback received through various mediums, including the Office of Personnel 

Management’s (OPM) Federal Employee Viewpoint Survey, continues to inform FLRA leaders 

about agency wellness from the perspective of its most valuable resource – its workforce. 

Employees understand the mission of the FLRA, understand their role in fulfilling the mission, 

and see themselves as an integral piece of achieving agency-wide success. By investing in its 

employees through classroom training, rotational details, cross-component learning, challenging 

assignments, and leadership development, FLRA employees continue to sharpen and broaden

their skills. In this connection, employees at all levels led and engaged in numerous missionrelated initiatives, including: the development of the FLRA’s bilingual webpages; a decisionwriting initiative intended to strengthen the quality of the Authority’s decisions; and the 

development of Authority and OGC training materials, guides, and manuals to educate and 

inform parties on the Statute and applicable legal standards, as well as the FLRA’s case 

processing procedures. 
11

With respect to performance management, employee recognition, accurate assessments, and ongoing meaningful discussions with supervisors are paramount to achieving agency performance 

results. To that end, the agency established better metrics to measure performance and 

productivity, and increased its use of non-monetary incentive awards to recognize employee 

achievement. FLRA managers and employees worked collectively to implement the agency’s 

new, multi-tier General Schedule Performance Management System, including implementation 

of an employee-facilitated ADR program for resolving performance management disputes and 

training on aspects of the system. Additionally, the FLRA was an early implementer of the 

government-wide Senior Executive Service performance appraisal system and received 

provisional certification of its system from the OPM. With implementation of the two new 

performance management systems, agency mission and goals are directly linked to performance 

from top to bottom. 

FY 2013 was a challenging year for the federal workforce, and FLRA employees faced the 

challenges head on, continuing to deliver on the FLRA’s mission. The FLRA was subject to the 

same sequestration cuts and reduced funding levels as all agencies, and at the same time, 

experienced an increase in demand for its services. The agency successfully managed the deep 

FY 2013 funding cut, handling its increased caseload and reduced staffing levels by using 

creative, immediate solutions to address the challenges. The agency used self-directed work 

teams, collateral duty assignments, and details from sister-agencies. Staffing strategies were 

influenced by the routine loss of expertise, both present and future needs of each agency office, 

and assessment of the talents of its existing workforce. Accordingly, the agency realigned 

offices, developed staff internally for anticipated vacancies, made use of voluntary 

reassignments, updated position descriptions, developed career-ladder positions, and recruited 

internally and externally to meet long-term work requirements. The agency also established a 

Student Pathways Policy for student internships, and partnered with the University of 

Maryland’s Federal Semester Program to offer unpaid internships to students.

With a commitment to increasing diversity and inclusion (D&I), the agency implemented its 

D&I Strategic Plan and metrics for assessing D&I success, reaffirming the FLRA’s dedication to 

fostering a workplace where employees from all backgrounds are recruited, retained, and 

developed for successful performance and career progression. Employee health and wellness 

programs have also continued at the FLRA. Employees are engaged in the community through 

pro-bono work, as well as various multi-cultural programs. The FLRA hosts a weekly yoga 

class, as well as monthly on-site nurse visits that include vision testing, cardiac risk profiling, 

blood pressure screening, and annual flu and whooping-cough shots. “Lunch & Learn” sessions 

on a variety of topics such as diabetes, acupuncture, and heart disease are offered to employees,

and periodic wellness tips are shared through the agency’s weekly internal newsletter, InSession. Human resources e-initiatives in FY 2013 included the successful implementation of a 

web-based time and attendance system to more efficiently capture employee time and attendance

and electronic approval of personnel actions. 

PERFORMANCE SUMMARY

The FLRA is a key component in bringing about real change within the federal government. In 

response to the demands of its customers and its own fiscal limitations, the agency has examined 
12

what works – both with respect to its own internal management and processes and its delivery of 

services – and continues to demonstrate a significant, marked improvement in its performance 

and program delivery. Without question, the FLRA’s performance has had a direct bearing on 

how well and quickly improvements in government operations have been effectuated. The 

nature of the services that the agency provides to its customers – in avoiding and resolving 

disputes that otherwise detract from mission performance – means that its vitality is important 

beyond its size.

With respect to its mission accomplishments, the FLRA has continued its significant 

improvement – which began in February 2009 – in providing customers with the timely and 

quality dispute resolution services that they deserve. The Authority opened FY 2013, having 

reduced its pending case inventory by 87 percent (from 394 to 50 cases), its overage case 

inventory by 100 percent (from 269 to zero cases), and the average age of pending cases by 81 

percent (from 270 to 51 days). As a result of a comprehensive review of arbitration case 

processing, the Authority implemented regulatory changes involving those cases. The evidence 

demonstrated that regulatory changes were necessary to reduce the number of procedural 

deficiencies in the parties’ filings, and to clarify for its customers the grounds for the Authority’s 

review and the applicable legal standards. There were real performance outcomes from these 

changes – arbitration cases are now processed and resolved more expeditiously. With real 

evidence that training its parties results in case processing efficiencies and faster resolution of 

disputes, the Authority expanded its efforts, launching a comprehensive negotiability training 

program, including the issuance of a guide addressing negotiability terms and concepts, case 

processing procedures, and substantive legal issues that frequently arise in negotiability disputes. 

OGC performance during FY 2013 was very successful, marked by increases in productivity 

along with improvements in the timely resolution of cases. Despite an increase in case filings, 

the OGC continued its productivity increases by resolving nearly 25 percent more cases than in 

FY 2009, exceeded its goal for timely resolution of ULP cases by eight percent, and met its goal 

for timely processing of representation cases. The OGC closed over 4,570 ULP cases and held 

trials in roughly 40 ULP cases. The OGC also closed 248 representation cases, conducting 48 

representation elections, and held 16 hearings. 

The OGC’s work is of critical importance to federal agencies throughout the government right 

now – all agencies are dealing with budgetary reductions and are restructuring operations 

(including conducting layoffs), examining and implementing new or revised work processes and 

procedures, and leveraging technology in order to bring efficiency to their operations. As 

recognized by Executive Order 13522, harmonious labor-management relations is an essential 

element in the successful implementation of these necessary and difficult changes, and the work 

of the OGC plays a vital role in insuring productive and efficient labor-management relations.

During these uncertain budgetary times, the OGC has redoubled its use of ADR techniques and 

services to resolve cases. The beneficial effects of ULP settlements and representation 

agreements are obvious and are aggressively pursued by the office. In this regard, significant 

savings of government staff and budgetary resources result from the early resolution of ULP and 

representation cases. To assist the parties, the OGC actively offers ADR throughout the 

processing of its cases and the parties welcome this service.
13

In FY 2013, the OGC successfully resolved over 900 ULP cases during the investigative process, 

including 189 cases where a formal complaint had been authorized. The OGC also successfully 

resolved 207 complaint cases before hearing. These successful ADR efforts resulted in 

significant savings of governmental budgetary resources.

The OALJ also continued to resolve cases at an increased pace in FY 2013, with over 40 cases 

resolved by written decision as compared to 20 in FY 2012. With over 700 new cases on their 

docket in the last three years, the OALJ has successfully resolved cases without the need for 

costly litigation involving a hearing or written decision. In this regard, in 78 percent of cases in 

which parties participate in the OLAJ’s Settlement Judge Program, agreement is reached, fully 

resolving the parties’ dispute. This is real evidence that the delivery of ADR services at all 

stages of case processing results in more effective and efficient program performance for the 

FLRA, as well as the timely resolution of disputes for its customers. The OALJ has seen an 

increase in demand for its services, as the number of complaints and the number of hearings 

required continue to rise – both exceeding those in FY 2012. To reduce the need for final written 

decisions, the ALJs are encouraging the parties to volunteer for bench decisions when the matter 

is not settled prior to hearing and a bench decision is appropriate under the facts of the case.

The FSIP experienced an increase in case filings for the fifth consecutive year, including over 40 

requests for assistance concerning bargaining over the impact and implementation of agency 

decisions to furlough employees due to sequestration. Its small professional staff did its best to 

investigate the unexpected influx of furlough-related cases, while maintaining timeliness in 

regard to the processing of non-furlough cases, recommending dispute resolution procedures to 

the Panel Members that maximized the possibility of voluntary settlements rather than imposing 

contract terms. In turn, the Members continued to obtain high rates of voluntary settlement, 

consistent with the FSIP’s guiding philosophy that the voluntary settlement of bargaining 

impasses using mediation-arbitration techniques is the most effective and efficient form of 

dispute resolution. In this regard, in cases where mediation-arbitration was used to resolve 

federal sector impasses, the Panel obtained complete voluntary settlements close to 65 percent of 

the time.

In balancing the use of its limited resources to meet the growing demands of its customers, the 

FSIP continued to prioritize case processing to ensure that disruption to government operations 

and cost to the taxpayers is minimized. For example, in response to Administration initiatives, 

Region 9 of the Environmental Protection Agency (EPA) decided to relocate approximately 500 

bargaining unit employees represented by two different labor organizations to a more energy 

efficient office in San Francisco, which reduced space by 20 percent. Using the expertise of one 

of its Panel Members in interest-based problem solving, a mediation-arbitration proceeding was 

convened where the parties were able to reach voluntary settlements on what appeared to be 

numerous intractable issues, permitting the EPA to complete the relocation without requiring 

taxpayers to pay rent at two locations. In another impasse involving the relocation of Region 7 

of the Department of Education in Kansas City, the Panel’s intervention resulted in an arbitration 

award by one of its Members, also preventing unnecessary taxpayer expenditures. As in 

previous years, the FSIP also conducted mediation-arbitration proceedings in a number of cases 

to resolve impasses expeditiously between the Social Security Administration and its unions over 

the floor plans for newly-relocated and renovated field offices. In addition, the Panel acted 
14

within the 60-day deadline established in the Federal Employees Flexible and Compressed Work 

Schedules Act by terminating the 4/10 compressed work schedules of civilian police officers at 

Portsmouth Naval Shipyard after the agency met its statutory burden by demonstrating that the 

schedules were causing unnecessary increases in overtime costs.

The FLRA’s CADRO continued to help parties resolve significant disputes in cases pending 

before the Authority. The CADRO also delivered “prevention” services, teaching parties 

techniques for effectively resolving their labor-management issues on their own, without needing 

third-party involvement. Both of these types of services helped parties develop constructive 

workplace relationships that promote better mission performance as well as quality of work-life 

– real evidence that the program works. 

During FY 2013, more than 80 percent of parties to negotiability cases filed with the FLRA 

voluntarily chose to resolve their differences using the CADRO’s services. Those parties 

successfully reached partial or total resolution in 100 percent of the cases that they brought to the 

FLRA, eliminating the need for the Authority to formally issue decisions to resolve nearly all of 

those cases. The CADRO also helped parties resolve exceptions to arbitration awards, sensitive 

collective-bargaining disputes, and other complex matters – some with far-reaching national

implications. In one Department of Defense case, the parties presented the FLRA with 37 

disputed collective bargaining proposals. Using the FLRA’s online technology for secure video 

conferencing, document review, caucusing, and other critical functions, the CADRO successfully 

facilitated a full resolution of the case, working with parties in four locations in three states that 

were separated by 4,500 miles. And the resolution was accomplished in just a matter of weeks. 

In another case involving a civilian federal agency with significant national security 

responsibilities, through a series of face-to-face meetings, the CADRO assisted the parties in 

resolving a very complex and sensitive dispute involving 31 negotiability issues. In addition to 

the value of the substantive solutions achieved through the CADRO, both parties and the FLRA 

conserved significant resources as a result of this success.

In addition, during FY 2013, recognizing the significant success of both the OALJ’s Settlement 

Judge Program and the FLRA’s Collaboration and Alternative Dispute Resolution Program, the 

agency linked the two programs by aligning these important functions within one office. The 

CADRO now conducts settlement activities in ULP cases pending in the OALJ, and conducts 

interventions in negotiability and arbitration cases pending in the Authority, as well as 

continuing its facilitation and training work. In doing so, the CADRO resolved nearly 80 percent 

of ULP complaints in which parties chose to avail themselves of ADR services under the OALJ 

Settlement Judge Program. Noteworthy ULP and negotiability cases during FY 2013 included 

those that helped parties better focus resources on protecting the nation’s homeland, supporting 

our combat troops, serving veterans, preparing for national emergencies, maintaining safe skies, 

managing nuclear-weapon systems, furthering space exploration, providing immigration 

services, ensuring environmental protection, securing dangerous criminals, and protecting the 

food supply. 

Evidence from agencies and employee representatives continue to reaffirm that FLRA 

investment in ADR services that are delivered by the OALJ, the OGC, the FSIP, and the 

CADRO is a very cost-effective way to help parties improve the quality of work-life and prevent 
15

workplace problems from interfering with the delivery of government services to the American 

people. ADR reduces the need for costly litigation, improves labor-management relationships, 

and enhances agency performance by advancing the agency's mission and increasing 

effectiveness and efficiency.

Another key strategy resulting in more effective and efficient program performance for the 

FLRA, as well as the timely resolution of disputes for its customers, was the agency’s delivery of 

hundreds of training, outreach, and facilitation sessions in FY 2013 to thousands of practitioners. 

The agency also continued its engagement with the labor-management community by issuing 

numerous press releases sharing important information with its customers, participating in local 

and national forums informing the public about the FLRA and its significant contributions to 

making government work more effectively and efficiently, and holding focus groups on agency 

processes and procedures to assist in evaluating new and existing approaches to program 

delivery. Among the external initiatives that continued to be important in FY 2013 were training 

and education for labor and management representatives and others. Indeed, requests for 

training are received daily in all of the FLRA’s components, and this demand is expected to 

continue, if not increase. The FLRA’s innovative use of technology to deliver its training, 

outreach, and facilitation services has enabled the agency to maximize the delivery of its 

services, reaching hundreds of its customers right at their desks for free. The FLRA also 

continues to partner with federal agencies to identify training needs and resources to meet 

customer demands.

In 2010, the FLRA was named the Most Improved Small Agency by the Partnership for Public 

Service. Building upon this success in 2011, the agency once again placed among the top of the 

Most Improved Small Agencies. In 2012, the FLRA continued to meet its commitment to 

increasing employee satisfaction and morale, capturing the #8 small agency ranking overall in 

the Best Places to Work in the Federal Government survey, reflecting a dramatic and 

unprecedented improvement of over 280 percent since 2009. The FLRA's achievements are 

particularly noteworthy given that, just three years prior, the agency placed last in the 2009 

survey. Most notable for 2012 were the FLRA’s rankings for certain “Best in Class” categories 

– ranking third overall in both Teamwork and Effective Leadership, and fifth in Strategic 

Management, Work/Life Balance, and Training and Development.

0

20

40

60

80

100

2005 2007 2009 2010 2011 2012

Best Places to Work Score
16

In a 2012 report issued by the Partnership, the FLRA was also recognized as the Most Improved 

Small Agency on Innovation. The FLRA’s 2011 innovation score of 67 percent exceeded the 

government-wide average of 63 percent. The report – which found that a 21st century federal 

government that effectively serves the needs of the American people must embrace 

transformation and inspire employees to seek continuous improvement – recognizes the 

importance of leaders empowering employees to initiate change and reward them for their 

achievements. Given today’s budgetary constraints, federal employees and their agencies are 

being asked to deliver more with fewer resources, meaning that innovation will be a critical 

factor in achieving improved performance. The FLRA is pleased to be recognized for 

empowering its employees in this regard.

Empowering employees is a key component of effective leadership, and in 2013, the FLRA was 

recognized by the Partnership in its Federal Leadership Snapshot as the #3 small agency for its 

effective leadership in the federal government. The FLRA’s score of 70 far exceeded the 

government-wide average of 53. Effective leadership is not only important for directing an 

organization’s operations and motivating the workforce, but also in guiding an organization 

through tough decisions about how to meet increased demand for services in a constrained 

resource environment. The FLRA’s leadership has played a pivotal role in advancing the 

agency's mission results and increasing program effectiveness and efficiency.

In 2013, the FLRA also continued its success in the Federal Employee Viewpoint Survey, with 

an employee response rate of 84 percent – significantly greater than the government-wide rate of 

48 percent. The agency scored 73 percent in leadership and knowledge management, 66 percent 

in results-oriented performance culture, 72 percent in talent management, and 71 percent in job 

satisfaction – each exceeding the government-wide average. Despite the tremendous strength 

and dedication shown by FLRA employees in the face of budget and staffing uncertainty, early 

indicators show – consistent with results government-wide – that the FLRA may experience a 

decline in overall employee satisfaction. Consistent with an agency-wide focus on targeting 

challenges identified in the survey, the FLRA has renewed its commitment to address areas of 

weakness or concern in full collaboration with its employees at all levels.

The FLRA’s dramatic and sustained improvements over the last four and half years reflects the 

commitment of leadership to managing the agency with transparency and accountability and 

engaging employees at all levels, as well as the commitment and dedication of FLRA employees. 

Consistent with the significant increase in employee morale and satisfaction accomplished since 

2009 has been a significant, marked improvement in the FLRA's mission performance and 

delivery of services to its customers.

Performance Outcome Measures

FY 2013

Target

FY 2013

Actual Result

Strategic Goal 1: Achieve superior customer service.

Performance Goal 1: Provide timely review and disposition of unfair labor practice cases.

A. Measure 1.1: The percentage of ULP 

charges resolved by the OGC by complaint, 60% 68% Exceeded
17

Performance Outcome Measures

FY 2013

Target

FY 2013

Actual Result

withdrawal, dismissal, or settlement within 

120 days of filing of the charge.

B. Measure 1.2: The percentage of decisions 

on an appeal of a Regional Director’s 

dismissal of a ULP charge issued within 60 

days of the date filed, and in no case more 

than 120 days.

90%/100% 100%/100% Exceeded/ 

Met

C. Measure 1.3: The percentage of ULP 

complaints issued by the General Counsel 

resolved or decided in the OALJ within 180 

days of the complaint being issued.

90% 86%

Substantially 

Met

D. Measure 1.4: The percentage of ULP 

cases decided within 180 days of 

assignment to an Authority Member.

80% 100% Exceeded

Performance Goal 2: Provide timely review and disposition of representation cases.

Measure 2.1: The percentage of 

representation cases resolved by the OGC 

through withdrawal, election, or issuance of 

a Decision and Order within 120 days of the 

filing of a petition.

60% 60% Met

Measure 2.2: The percentage of 

representation cases in which a decision 

whether to grant review is issued within 60 

days of assignment to an Authority 

Member.

100% 100% Met

Performance Goal 3: Provide timely review and disposition of arbitration cases.

Measure 3.1: The percentage of arbitration 

cases decided within 180 days of 

assignment to an Authority Member.

80% 91% Exceeded

Performance Goal 4: Provide timely review and disposition of negotiability cases.

Measure 4.1: The percentage of 

negotiability cases decided within 180 days 

of assignment to an authority Member 

(reflecting reasonable time for a postpetition conference).

80% 100% Exceeded

Performance Goal 5: Provide timely review and disposition of bargaining impasse cases.

Measure 5.1: The percentage of 

bargaining impasse cases in which 

jurisdiction is declined closed within 140 

days of the date filed.

80% 95% Exceeded

Measure 5.2: The percentage of 70% 97% Exceeded
18

Performance Outcome Measures

FY 2013

Target

FY 2013

Actual Result

bargaining impasse cases voluntarily settled 

after jurisdiction has been asserted within 

160 days of the date filed.

Measure 5.3: The percentage of 

bargaining impasse cases resolved through 

a final action closed within 200 days of the 

date filed.

70% 87% Exceeded

Performance Goal 6: Use collaboration techniques and alternative dispute resolution 

services to minimize and/or resolve labor-management disputes.

Measure 6.1: The percentage of ULP 

cases in the OGC in which an offer of ADR 

services is accepted by the parties that are 

partially or totally resolved.

90% 98% Exceeded

Measure 6.2: The percentage of ULP 

cases in the OALJ in which an offer of 

Settlement Judge services is accepted by the 

parties that are partially or totally resolved.

80% 78%

Substantially 

Met

Measure 6.3: The percentage of 

representation cases in the OGC in which 

an offer of ADR services is accepted by the 

parties that are partially or totally resolved.

90% 100% Exceeded

Measure 6.4: The percentage of arbitration 

cases in which an offer of ADR services is 

accepted by the parties that are partially or 

totally resolved.

50% 100% Exceeded

Measure 6.5: The percentage of 

negotiability cases in which an offer of 

ADR services is accepted by the parties that 

are partially or totally resolved.

80% 100% Exceeded

Measure 6.6: The percentage of 

bargaining impasse cases in which an offer

of ADR services is accepted by the parties 

that are partially or totally resolved.

30% 28% Substantially 

Met

Measure 6.7: The number of training, 

outreach, and facilitation activities 

conducted.

175 302 Exceeded

Measure 6.8: The number of participants

involved in training, outreach, and 

facilitation activities.

5,000 5,976 Exceeded

Strategic Goal 3: Advance performance through organizational and management excellence.

Performance Goal 7: Modernize agency IT business systems to support and enhance 

program achievement.
19

Performance Outcome Measures

FY 2013

Target

FY 2013

Actual Result

Measure 7.1: The percentage of cases filed 

electronically with the FLRA.

25% 10% Not Met

Measure 7.2: The percentage of cases 

processed electronically end-to-end.

Conduct a 

pilot program 

on end-to-end 

case 

processing.

Conducted a 

pilot program 

on end-to-end 

case 

processing.

Met

Strategic Goal 4: Develop, empower, and engage FLRA employees to meet program needs 

and improve job satisfaction.

Performance Goal 8: Develop, manage, and utilize FLRA’s human resources to meet 

program needs.

Measure 8.1: Program managers ensure 

that the right employees are in the right 

place to achieve results.

Update the 

Human Capital 

Strategic Plan. 

Implement a 

web-based 

time and 

attendance

(T&A) system.

Implemented a 

web-based 

T&A system.

Substantially 

Met

FINANCIAL ANALYSIS

The FLRA’s principal financial statements have been prepared to report the financial position 

and results of operations of the agency, pursuant to the requirements of 31 U.S.C. 3515(b). 

While the statements have been prepared from the books and records of the FLRA in accordance 

with U.S. Generally-Accepted Accounting Principles for federal entities and the formats 

prescribed by the Office of Management and Budget (OMB), the statements are in addition to the 

financial reports used to monitor and control budgetary resources, which are prepared from the 

same books and records. The statements should be read with the realization that they are for a 

component of the U.S. government, a sovereign entity.

Balance Sheet

The Balance Sheet presents the FLRA’s financial position through the identification of agency 

assets, liabilities, and net position. The FLRA’s fund balance with the Department of the 

Treasury is its largest asset, accounting for over 90 percent of total assets in both FY 2012 and 

FY 2013. The FLRA does not maintain any cash in commercial bank accounts or foreign 

currency balances, nor does it have any revolving or trust funds. The agency’s second largest 

asset is its furniture, fixtures, equipment, and IT hardware and software, which is recorded at 

original acquisition cost and then depreciated or amortized using the straight-line method over 

the estimated useful life of the asset.
20

Total assets decreased from $4.9 million at the end of FY 2012 to $3.7 million at the end of FY 

2013. The decrease in assets is primarily attributable to cancellation of the FLRA’s FY 2008

expired account, which held $1.2 million in unobligated funds. Moreover, the agency did not 

make any new capitalized purchases in FY 2013, while the net book value of property and 

equipment already owned experienced further depreciation.

Assets as of September 30, 2013 2012

Fund balance with the Treasury $3,488,106 $4,525,133

General property and equipment 212,632 353,163

Advances and prepayments 27,298 21,414

Accounts receivable 16,742 13,507

Total $3,744,778 $4,913,217

Funds held with the Treasury are available to pay agency liabilities. Liabilities represent the 

amount of monies or other resources likely to be paid by the FLRA as a result of transactions or 

events that have already occurred. Accrued employee leave, payroll, and benefit costs, along 

with accrued workers’ compensation under the Federal Employees Compensation Act (FECA), 

accounted for over 90 percent of total liabilities at the end of both FY 2012 and FY 2013. The 

remaining ten percent reflects the amount owed by the FLRA to vendors and other Federal 

agencies for purchased goods and services. Agency liabilities totaled $4.4 million in FY 2012

and $4.3 million in FY 2013.

Liabilities as of September 30, 2013 2012

Unfunded leave 1,412,090 $1,519,345

FECA liability 1,407,583 1,426,017

Accrued payroll and benefits 1,025,702 1,207,777

Accounts payable 414,815 225,496

Custodial liability/other 282 40

Total $4,260,472 $4,378,675

The FLRA’s total net position at the end of FY 2013 was negative $516 thousand, a $1.1 million 

decrease from the previous year due to the expiration of FY 2008 funds.

Statement of Net Cost

The Statement of Net Cost presents the gross cost of operating the FLRA’s three major 

programs, less any reimbursable revenue earned from those activities. The net cost of operations 

in FY 2013 was $24.6 million, a $1.7 million decrease from the agency’s FY 2012 cost of 

operations. In FY 2013, 62 percent of the agency’s direct resources were dedicated to the 

Authority, which includes central administrative services provided to the entire agency; 35

percent were dedicated to the OGC; the remaining three percent were devoted to the FSIP.
21

Statement of Changes in Net Position

The Statement of Changes in Net Position reflects the changes that occurred within the 

cumulative results of operations and any unexpended appropriations. The cumulative results of 

operations represent the net results of operations since inception, the cumulative amount of priorperiod adjustments, the remaining book value of capitalized assets, and future funding 

requirements. Cumulative results remained constant from FY 2012 to FY 2013, totaling $2.6

million.

Unexpended appropriations include undelivered orders and unobligated balances. Undelivered 

orders reflect the amount of goods and services ordered that have yet to be received. 

Unobligated balances are the amount of appropriations or other authority remaining after 

deducting the cumulative obligations from the amount available for obligation. The decrease in 

total, unexpended FLRA appropriations of $1 million – from $3.1 million to $2.1 million – is 

due primarily to expiration of the agency’s FY 2008 account.

Statement on Budgetary Resources

The Statement on Budgetary Resources reports the budgetary resources available to the FLRA 

during FY 2012 and FY 2013 to carry out the activities of the agency, as well as the status of 

those resources at the end of each year. The primary source of FLRA funding is its annual 

Salaries and Expenses appropriation from the Congress. The agency also receives 

reimbursements, pursuant to the Economy Act, for travel expenses associated with training 

provided by agency employees on the Statute, the FLRA mission, Executive Order 13522, etc.

The agency had $24.5 million in total budgetary resources available to it in FY 2013, of which 

$1.1 million remained unobligated from prior-years. The agency incurred obligations of $23.6

million in FY 2013, while recording outlays of $23.3 million. Total budgetary resources 

FY 2013 Financial Obligations by Budget Object Class

Compensation & benefits (76%)

Rent & utilities (11%)

Other contractual services (9%)

Communications (2%)

Supplies & equipment (1%)

Travel & transportation (1%)
22

decreased by $2.1 million in FY 2013 from expiration of the FLRA’s FY 2008 account and from 

across-the-board and sequestration rescissions included in Public Law 113-6.

MANAGEMENT ASSURANCES

The Federal Managers Financial Improvement Act (FMFIA) of 1982 requires agencies to 

establish internal control and financial systems that provide reasonable assurance that the 

integrity of federal programs and operations are protected. The FMFIA also requires the 

Chairman to annually assess and report on the effectiveness of internal controls and to provide an 

annual Statement of Assurance on whether the agency has met this requirement.

Annual FMFIA Statement of Assurance

In accordance with the requirements of OMB Circular A-123, Management’s Responsibility for 

Internal Control, the FLRA conducted an assessment of the effectiveness of the organization’s 

internal controls to support effective and efficient operations, reliable financial reporting, and 

compliance with applicable laws and regulations, and whether the financial management system 

conforms to applicable financial requirements.

Based on the results of this assessment, the FLRA provides reasonable assurance that its internal 

controls over the effectiveness and efficiency of operations, reliable financial reporting, and 

compliance with applicable laws and regulation as of September 30, 2013, were operating 

effectively and that no material weaknesses were found in the design or operation of our internal 

controls.

Further, based on our assessment, we determined that the FLRA financial management system 

conforms to applicable financial systems requirements.

Carol Waller Pope

Chairman

December 16, 2013
23

PERFORMANCE GOALS AND RESULTS

GOAL 1: PROVIDE TIMELY REVIEW AND DISPOSITION OF UNFAIR 

LABOR PRACTICE CASES.

The General Counsel has responsibility for the investigation, settlement, and prosecution of

unfair labor practice (ULP) charges. All ULP proceedings originate with the filing of a charge in 

a Regional Office by an employee, labor organization, or agency. Once a charge has been filed, 

Regional Office staff will investigate the charge to determine if it has merit. If the Regional 

Director determines that the charge has merit, then he or she will, absent settlement, issue and 

prosecute a complaint before an Administrative Law Judge (ALJ). If the Regional Director 

determines that the charge lacks merit, then the charging party is entitled to a written 

explanation, and if not satisfied, may appeal the decision to the General Counsel in Washington, 

DC. If the dismissal is upheld, then the case is closed. The Authority has appointed ALJs to 

hear ULP cases prosecuted by the General Counsel. Decisions of the ALJs are transmitted to the 

Authority and may be affirmed, modified, or reversed in whole or in part. If no exceptions are 

filed, then a decision by the ALJ is adopted by the Authority.

OGC FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Cases pending, start of year 1,237 1,587 1,811 1,453 1,488

Charges filed 3,954 4,398 4,094 4,375 4,659

Total caseload 5,191 5,985 5,905 5,828 6,147

Charges withdrawn/settled 2,455 3,141 3,425 3,377 3646

Charges dismissed 1,075 751 812 732 673

Complaints issued 74 282 215 231 258

Total cases closed 3,604 4,174 4,452 4,340 4,577

Cases pending, end of year 1,587 1,811 1,453 1,488 1,570

OALJ FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Cases pending, start of year 0 67 54 72 115

Cases received from the OGC 74 282 234 240 271

Total caseload 74 349 288 312 386

Settlements before hearing 7 275 191 176 222

Settlements during hearing 0 0 0 1 1

Cases closed by decision 0 20 25 20 43

Total cases closed 7 295 216 197 266

Cases pending, end of year 67 54 72 115 120
24

Authority FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Cases pending, start of year 32 14 14 6 2

Exceptions filed 1 18 17 20 27

Total caseload 33 32 31 26 29

Cases closed procedurally 0 9 13 16 16

Cases closed based on merits 19 9 12 8 1

Total cases closed 19 18 25 24 17

Cases pending, end of year 14 14 6 2 12

Measure 1.1: The percentage of ULP charges resolved by the Office of the General Counsel 

(OGC) by complaint, withdrawal, dismissal, or settlement within 120 days of filing of the 

charge.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

71% 49% 54% 61% 60% 68%

Data Source: Case Management System

Target: Exceeded. 

Measure 1.2: The percentage of decisions on an appeal of a Regional Director’s dismissal of 

a ULP charge issued within 60 days of the date filed, and in no case more than 120 days.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

2% 31% 97%/100% 99%/100% 90%/100% 100/100%

Data Source: Case Management System

Target: Exceeded/Met. In FY 2011, an additional target was established to measure the 

percentage of decisions on appeal issued within 120 days (100 percent).

Measure 1.3: The percentage of ULP complaints issued by the General Counsel resolved or 

decided in the Office of the Administrative Law Judges (OALJ) within 180 days of the 

complaint being issued.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 95% 90% 90% 86%

Data Source: Case Management System

Target: Substantially Met. This measure was established in FY 2011, as a consolidation of 

two previous 90-day measures into one of 180 days.
25

Measure 1.4: The percentage of ULP cases decided within 180 days of assignment to an 

Authority Member.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

5% 18% 31% 75% 80% 100%

Data Source: Case Management System

Target: Exceeded. 

GOAL 2: PROVIDE TIMELY REVIEW AND DISPOSITION OF 

REPRESENTATION CASES.

The Federal Service Labor-Management Relations Statute sets out a specific procedure for 

employees to petition to be represented by a labor union and to determine which employees will 

be included in a “bargaining unit” that a union represents. Implementing this procedure, the 

FLRA conducts secret-ballot elections for union representation and resolves a variety of issues 

related to questions of union representation of employees. These issues include, for example, 

whether particular employees are managers or “confidential” employees excluded from union 

representation, whether there has been election misconduct on the part of agencies or unions, and 

whether changes in union and agency organizations affect existing bargaining units. 

Representation cases are initiated by the filing in a Regional Office of a petition by an individual, 

labor organization, or agency. After a petition is filed, the Regional Director conducts an 

investigation to determine the appropriateness of a unit or other matter related to the petition. 

After concluding such investigation, the Regional Director may conduct a hearing to resolve 

disputed factual matters. The Regional Director then issues a Decision and Order determining 

the appropriate unit, directing an election, dismissing the petition, or making other disposition of 

the matter. The Regional Director’s Decision and Order is final unless an application for review 

is filed with the Authority.

OGC FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Cases pending, start of year 140 104 102 82 70

Petitions filed 275 278 267 271 240

Total caseload 415 382 369 353 310

Petitions withdrawn 142 113 126 115 106

Cases closed based on merits 169 167 161 168 142

Total cases closed 311 280 287 283 248

Cases pending, end of year 104 102 82 70 62
26

Authority FY 2009 FY 2010 FY 2011 FY 2012 FY 2012

Cases pending, start of year 3 5 6 6 0

Applications for review 17 15 12 6 11

Total caseload 20 20 18 12 11

Cases closed procedurally 1 1 0 0 1

Cases closed based on merits 14 13 12 12 1

Total cases closed 15 14 12 12 2

Cases pending, end of year 5 6 6 0 9

Measure 2.1: The percentage of representation cases resolved by the OGC through 

withdrawal, election, or issuance of a Decision and Order within 120 days of the filing of a 

petition.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

60% 65% 60% 62% 60% 60%

Data Source: Case Management System

Target: Met. 

Measure 2.2: The percentage of representation cases in which a decision whether to grant 

review is issued within 60 days of assignment to an Authority Member.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A 100% 100% 100% 100% 100%

Data Source: Case Management System

Target: Met. This measure was established in FY 2010 to be consistent with the time 

limitation provided for in the Statute.

GOAL 3: PROVIDE TIMELY REVIEW AND DISPOSITION OF 

ARBITRATION CASES.

Either party to grievance arbitration may file with the Authority an exception (or appeal) to an 

arbitrator’s award. The Authority will review an arbitrator’s award to which an exception has 

been filed to determine if the award is deficient because it is contrary to any law, rule, or 

regulation or on grounds similar to those applied by federal courts in private-sector, labormanagement relations.
27

Authority FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Cases pending, start of year 298 247 173 66 40

Exceptions filed 157 134 110 107 124

Total caseload 455 381 283 173 164

Cases closed procedurally 43 31 22 24 19

Cases closed based on merits 165 177 195 109 22

Total cases closed 208 208 217 133 41

Cases pending, end of year 247 173 66 40 123

Measure 3.1: The percentage of arbitration cases decided within 180 days of assignment to 

an Authority Member.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

22% 30% 33% 58% 80% 91%

Data Source: Case Management System

Target: Exceeded. 

GOAL 4: PROVIDE TIMELY REVIEW AND DISPOSITION OF 

NEGOTIABILITY CASES.

A federal agency bargaining with a union may claim that a particular union proposal cannot be 

bargained because it conflicts with federal law, a government-wide rule or regulation, or an 

agency regulation for which there is a compelling need. In these cases, a union may petition the 

Authority to resolve the negotiability dispute.

Authority FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Cases pending, start of year 51 39 22 15 8

Petitions filed 43 52 39 45 30

Total caseload 94 91 61 60 38

Cases closed procedurally 41 46 33 38 27

Cases closed based on merits 14 23 13 14 2

Total cases closed 55 69 46 52 29

Cases pending, end of year 39 22 15 8 9
28

Measure 4.1: The percentage of negotiability cases decided within 180 days of assignment to 

an Authority Member (reflecting reasonable time for a post-petition conference).

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

6% 17% 29% 50% 80% 100%

Data Source: Case Management System

Target: Exceeded. 

GOAL 5: PROVIDE TIMELY REVIEW AND DISPOSITION OF

BARGAINING IMPASSE CASES.

In carrying out the right to bargain collectively, it is not uncommon for a union representative 

and a federal agency to simply not agree on certain issues and for the bargaining to reach an 

impasse. Several options are available by which the parties may attempt to resolve the impasse. 

The parties may: decide, on their own, to use certain techniques to resolve the impasse, but may 

proceed to private binding arbitration only after the Federal Service Impasses Panel (FSIP) 

approves the procedure; seek the services and assistance of the Federal Mediation and 

Conciliation Service; or seek the assistance of the FSIP in resolving the negotiation impasse, but 

only after the previous attempts have failed.

FSIP FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Cases pending, start of year 22 69 36 53 38

Impasses filed 136 143 152 176 194

Total caseload 158 212 188 229 232

Cases closed 89 176 135 191 192

Cases pending, end of year 69 36 53 38 40

Measure 5.1: The percentage of bargaining impasse cases in which jurisdiction is declined 

closed within 140 days of the date filed.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 64% 92% 80% 95%

Data Source: Case Management System

Target: Exceeded. The performance measures for the FSIP were completely revised in FY 

2011 to concisely set forth timeliness targets for the Panel’s three most important categories of 

case disposition.
29

Measure 5.2: The percentage of bargaining impasse cases voluntarily settled after jurisdiction 

has been asserted within 160 days of the date filed.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 79% 86% 70% 97%

Data Source: Case Management System

Target: Exceeded. 

Measure 5.3: The percentage of bargaining impasse cases resolved through a final action 

closed within 200 days of the date filed.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 65% 77% 70% 87%

Data Source: Case Management System

Target: Exceeded. 

GOAL 6: USE COLLABORATION TECHNIQUES AND ALTERNATIVE 

DISPUTE RESOLUTION SERVICES TO MINIMIZE AND/OR RESOLVE 

LABOR-MANAGEMENT DISPUTES.

The FLRA has integrated alternative dispute resolution (ADR) and consensus decision-making 

into virtually all of its processes, and significantly expanded its training, outreach, and 

facilitation activities since FY 2011. ADR is an informal process that allows parties to discuss 

and develop their interests in order to resolve the underlying issues and problems in their 

relationship. This includes interest-based conflict resolution and intervention services in pending 

ULP cases, representation cases, arbitration cases, negotiability appeals, and bargaining impasse 

disputes. The agency also provides facilitation and training to help labor and management 

develop collaborative relationships. Many of the FLRA’s training programs are now available as 

web-based training modules, bringing educational tools and resources directly to agency 

customers at their desks to further assist them in resolving labor-management disputes.

Measure 6.1: The percentage of ULP cases in the OGC in which an offer of ADR services is 

accepted by the parties that are partially or totally resolved.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 87% 97% 90% 98%

Data Source: Case Management System

Target: Exceeded. This performance goal was established in FY 2011 to emphasize the 

importance of using collaboration and ADR techniques along with other training, outreach, 
30

and facilitation services to assist the parties in minimizing and resolving labor-management 

disputes. The goal encompasses all three FLRA components.

Measure 6.2: The percentage of ULP cases in the OALJ in which an offer of Settlement 

Judge services is accepted by the parties that are partially or totally resolved.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 88% 80% 80% 78%

Data Source: Case Management System

Target: Substantially Met. 

Measure 6.3: The percentage of representation cases in the OGC in which an offer of ADR 

services is accepted by the parties that are partially or totally resolved.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 93% 91% 90% 100%

Data Source: Case Management System

Target: Exceeded. 

Measure 6.4: The percentage of arbitration cases in which an offer of ADR services is 

accepted by the parties that are partially or totally resolved.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 100% N/A 50% 100%

Data Source: Case Management System

Target: Exceeded. In FY 2012, there was only one arbitration case in which an offer of 

ADR services was accepted by the parties. The ADR process concerning that case was still 

ongoing at the end of the fiscal year. As a result, this performance measure, which tracks the

partial or total resolution of accepted cases, did not apply in FY 2012.

Measure 6.5: The percentage of negotiability cases in which an offer of ADR services is 

accepted by the parties that are partially or totally resolved.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 87% 100% 80% 100%

Data Source: Case Management System

Target: Exceeded. 
31

Measure 6.6: The percentage of bargaining impasse cases in which an offer of ADR services 

is accepted by the parties that are partially or totally resolved.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 29% 32% 30% 28%

Data Source: Case Management System

Target: Substantially Met. 

Measure 6.7: The number of training, outreach, and facilitation activities conducted.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 332 221 175 302

Data Source: Case Management System

Target: Exceeded. 

Measure 6.8: The number of participants involved in training, outreach, and facilitation 

activities.

FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Actual Actual Actual Actual Target Actual

N/A N/A 11,975 8,933 5,000 5,976

Data Source: Case Management System

Target: Exceeded.

GOAL 7: MODERNIZE AGENCY INFORMATION TECHNOLOGY 

BUSINESS SYSTEMS TO SUPPORT AND ENHANCE PROGRAM 

ACHIEVEMENT.

The FLRA’s Case Management System (CMS) was implemented in FY 2011, and since that 

time, the agency has steadily built the capacity for electronic case filing (eFiling) in all agency 

components, as well as development of a complete electronic case file. The FLRA has met its 

key milestones, and it is poised to have its customers maximize use of the eFiling system, 

significantly enhancing the quality of parties’ filings and reducing procedural deficiencies. In 

addition, the FLRA intends to fully implement an “end-to-end” electronic case file, streamlining 

the processing and handling of agency case files.

Measure 7.1: The percentage of cases filed electronically with the FLRA.

FY 2009 Actual Awarded a contract for Case Management System development using 

the cloud solution, QuickBase.
32

FY 2010 Actual Implemented the new Case Management System for all three FLRA 

components.

FY 2011 Actual Began developing an eFiling solution. Completed development of

customer registration and FSIP eFiling capability.

FY 2012 Actual Completed development of Authority and OGC eFiling capability. 

Began testing eFiling capability with customers.

FY 2013

Target 25% of all cases will be filed electronically.

Actual 10%

Data Source: Case Management System

Target: Not Met. Although the FLRA did not meet its FY 2013 performance target as an 

agency, 31 percent of the cases filed with the Authority component were filed electronically.

Measure 7.2: The percentage of cases processed electronically end-to-end.

FY 2009 Actual N/A

FY 2010 Actual N/A

FY 2011 Actual N/A

FY 2012 Actual Enhanced the Case Management System to provide the structure that 

supports end-to-end electronic case processing.

FY 2013

Target Conduct a pilot program on end-to-end case processing.

Actual Conducted a pilot program on end-to-end case processing.

Data Source: FLRA Information Resources Management Division

Target: Met. This measure was established in FY 2012 to serve as an indicator of success in 

developing and implementing an end-to-end electronic case file.

GOAL 8: DEVELOP, MANAGE, AND UTILIZE THE FLRA’S HUMAN

CAPITAL TO MEET PROGRAM NEEDS.

The FLRA, in consultation with the FLRA Labor-Management Forum, continued to make major 

gains in FY 2013 in terms of developing, managing, and utilizing human capital. Continued 

growth in the use of the alternative work schedule program allows employees to better balance 

their personal lives with the demands of their work. Implementation of an electronic time and 

attendance system resulted in time and attendance recording and submission more accurate and 

efficient. Succession planning continues to be a major area of concern for the FLRA. 

Developmental details for attorneys allowed for the individual development of those who 

participate, and also allowed the agency to manage workloads, reduced staffing, and succession 

planning more strategically. The agency’s performance management and awards policies were 

revised, and the agency now assesses employee performance on a five-tiered scale rather than 

pass-fail. The revisions have continued to make performance review more meaningful, and 

ensured that awards are distributed on the basis of merit. The FLRA is continually assessing the 

training needs of its workforce, focusing not only on mission-critical skills, but also on human 

capital and performance management development. The results from the assessments have 
33

played a role in targeting training funds to the areas employees and supervisors deem most in 

need of development.

Measure 8.1: Program managers ensure that the right employees are in the right place to 

achieve results.

FY 2009 Actual N/A

FY 2010 Actual

Increased staffing levels in each program area; improved employee 

worklife balance through implementation of a robust telework 

program and video-conferencing, which reduces travel costs and time 

away from family; implemented an employee leadership 

developmental initiative in the OGC; and implemented a Student 

Temporary Employment Program. Also began human capital einitiatives to improve hiring through the purchase of USAStaffing (an 

automated hiring system), which engages the hiring manager in all 

aspects of the hiring process, reduces time-to-hire metrics, and 

improves applicants’ Federal hiring experience.

FY 2011 Actual

The FLRA continued to focus on employee engagement in FY 2011. 

Its Labor-Management Forum updated the Alternative Work Schedule 

policy, which increased flexibility within the program, began work on 

recognizing diversity through special emphasis programs, and 

initiated efforts to update employee awards programs. The agency 

also formed a joint labor-management workgroup to design a new 

Performance Management System for General Schedule employees 

for Office of Personnel Management (OPM) approval and agency 

implementation; an employee workgroup also designed and submitted 

to OPM for approval a revised Senior Executive Service (SES) 

appraisal system. Consistent with the Human Capital Strategic Plan, 

FLRA developed a training needs assessment, which will be used to 

create individual development plans to address areas needing skills 

improvement and to further increase mission-critical competencies. 

Additionally, the agency supported employee ideas, initiatives, and

employee-focused programs, such as “Bring Your Child to Work” 

day, Public Service Recognition Week, a health benefits fair, and a 

blood drive. FLRA also initiated brown-bag programs and an 

educational series to inform and develop employees in a casual 

setting. Human capital e-initiatives continued with the successful 

implementation of USAStaffing, NBC’s DataMart reporting tool, and 

employee eOPFs.

FY 2012 Actual

Enhanced development offerings to include competency-based 

training, career-ladder developmental programs, and continuation of 

HR workshops and educational brown-bags. A Diversity and 

Inclusion Strategic Plan was launched to make the agency a more 

inclusive and inviting workplace for all of its employees. Hiring of 

summer student interns, in some cases using targeted minority hiring 

strategies, also increased the FLRA’s diversity. Developmental 

offerings were expanded to include attorney details within the FLRA.
34

FY 2013

Target Update the Human Capital Strategic Plan. Implement a web-based 

time and attendance (T&A) system.

Actual

Implemented a web-based T&A system to increase efficiency and 

accuracy of reporting. Obtained provisional certification of the 

FLRA’s SES Performance Management System. Established an ADR 

process for resolving performance issues. As a part of its strategic 

workforce planning efforts, continued employee development, 

including attorney details to other offices, ADR facilitator training, 

leadership development and other workforce training. Established a 

Student Pathways Policy for student internships, and partnered with

the University of Maryland’s Federal Semester Program to offer 

unpaid internships to students.

Data Source: FLRA Human Resources Division

Target: Substantially Met. This performance goal was established in FY 2010 to emphasize 

the importance of and dedication to FLRA’s human resources.

VERIFICATION AND VALIDATION OF PERFORMANCE DATA

The FLRA Case Management System (CMS) is used by each component to track and manage 

agency caseload. Each component enters information on all cases into the CMS and is 

accountable for quality control of all workload data entered into the system. Data verification 

and validation was performed using the CMS.
35

PRINCIPAL FINANCIAL STATEMENTS

MESSAGE FROM THE CHIEF FINANCIAL OFFICER

The FLRA’s FY 2013 Performance and Accountability Report reflects the correlation between 

the financial and programmatic aspects of the agency’s work. The report bridges these two 

areas, presenting FLRA performance with the financial results of agency operations. The 

principal financial statements and notes that follow explain the FLRA’s financial position as of 

September 30, 2013, and how financial resources were expended to achieve performance results. 

For the tenth consecutive year, the FLRA received an unqualified opinion on its financial 

statements. Along with the unqualified opinion, the report of independent auditors found no 

material weaknesses in the design and operation of the agency system of internal controls over 

financial reporting.

With the likelihood that FY 2014 will be a difficult year financially, we are focused on 

identifying solutions to maintain our financial viability, ensure transparency and accountability,

and continue our high levels of mission performance and employee satisfaction and morale. We 

will continue to work with the Administration, the Congress, and agency stakeholders to identify 

and implement solutions for a sustainable funding model. We are confident that the FLRA’s 

financial and performance data are complete, accurate, and reliable.

Carol Waller Pope

Chairman and Chief Financial Officer

December 16, 2013
36

Federal Labor Relations Authority

BALANCE SHEET

(in dollars)

As of September 30, 2013 and 2012

2013 2012

Assets:

Intragovernmental:

Fund balance with the Treasury (Note 2) $3,488,106 $4,525,133

Accounts receivable (Note 3) 0 1,335

Advances and prepayments 27,298 21,414

Total intragovernmental 3,515,404 4,547,882

Accounts receivable from the public, net (Note 3) 16,742 12,172

General property and equipment, net (Note 4) 212,632 353,163

Total Assets $3,744,778 $4,913,217

Liabilities:

Intragovernmental:

Accounts payable $52,987 $40,857

Unfunded FECA liability (Note 5) 227,025 240,761

Custodial liability 0 38

Total intragovernmental 280,012 281,656

Accounts payable 361,828 184,639

FECA actuarial liability (Note 5) 1,180,558 1,185,256

Unfunded leave (Note 5) 1,412,090 1,519,345

Accrued payroll and benefits 1,025,702 1,207,777

Other (Note 6) 282 2

Total Liabilities $4,260,472 $4,378,675

Net Position:

Unexpended appropriations – other funds $2,071,393 $3,117,955

Cumulative results of operations – other funds (2,587,087) (2,583,413)

Total Net Position $(515,694) $534,542

Total Liabilities and Net Position $3,744,778 $4,913,217

The accompanying notes are an integral part of these statements.
37

Federal Labor Relations Authority

STATEMENT OF NET COST

(in dollars)

For the Years Ended September 30, 2013 and 2012

2013 2012

Gross Program Costs:

Authority:

Intragovernmental costs $3,928,616 $4,037,251

Public costs 11,392,530 10,735,958

Total costs 15,321,146 14,773,209

Intragovernmental earned revenue (24,275) (1,223)

Public earned revenue (2,902) (3,144)

Less: Total earned revenue (27,177) (4,367)

Net Program Costs $15,293,969 $14,768,842

Office of the General Counsel:

Intragovernmental costs $39,215 $0

Public costs 8,699,750 10,816,099

Total costs 8,738,965 10,816,099

Intragovernmental earned revenue (10,296) (24,924)

Public earned revenue (8,903) (9,218)

Less: Total earned revenue (19,199) (34,142)

Net Program Costs $8,719,766 $10,781,957

Federal Service Impasses Panel:

Intragovernmental costs $0 $0

Public costs 621,410 791,422

Total costs 621,410 791,422

Intragovernmental earned revenue 0 (643)

Public earned revenue (600) (548)

Less: Total earned revenue (600) (1,191)

Net Program Costs $620,810 $790,231

Net Cost of Operations $24,634,545 $26,341,030

The accompanying notes are an integral part of these statements.
38

Federal Labor Relations Authority

STATEMENT OF CHANGES IN NET POSITION

(in dollars)

For the Years Ended September 30, 2013 and 2012

2013 2012

Cumulative Results of Operations:

Beginning balance $(2,583,413) $(2,332,968)

Budgetary financing sources:

Appropriations used 23,270,794 24,594,738

Non-exchange revenue (282) (2)

Other financing sources (non-exchange):

Imputed financing 1,360,359 1,495,849

Total financing sources 24,630,871 26,090,585

Net cost of operations (24,634,545) (26,341,030)

Net change (3,674) (250,445)

Cumulative Results of Operations $(2,587,087) $(2,583,413)

Unexpended Appropriations:

Beginning balance $3,117,955 $5,016,802

Budgetary financing sources:

Appropriations received 24,723,000 24,723,000

Other adjustments (2,498,768) (2,027,109)

Appropriations used (23,270,794) (24,594,738)

Total budgetary financing sources (1,046,562) (1,898,847)

Total Unexpended Appropriations $2,071,393 $3,117,955

Net Position $(515,694) $534,542

The accompanying notes are an integral part of these statements.
39

Federal Labor Relations Authority

STATEMENT OF BUDGETARY RESOURCES

(in dollars)

For the Years Ended September 30, 2013 and 2012

2013 2012

Budgetary Resources:

Unobligated balance, brought forward, October 1 $1,847,474 $3,253,030

Recoveries of prior year unpaid obligations 418,760 611,555

Other changes in unobligated balance (1,205,607) (2,027,109)

Unobligated balance from prior year budget authority, net 1,060,627 1,837,476

Appropriation 23,429,839 24,723,000

Spending authority from offsetting collections 46,900 46,053

Total budgetary resources $24,537,366 $26,606,529

Status of Budgetary Resources:

Obligations incurred (Note 10) $23,634,042 $24,759,055

Unobligated balance, end of year:

Apportioned 67,001 63,518

Unapportioned 836,323 1,783,956

Total obligated balance, end of year 903,324 1,847,474

Total budgetary resources $24,537,366 $26,606,529

Change in Obligated Balance:

Unpaid obligations:

Unpaid obligations, brought forward, October 1 $2,692,558 $3,285,463

Obligations incurred 23,634,042 24,759,055

Outlays (gross) (23,320,255) (24,740,405)

Recoveries of prior year unpaid obligations (418,760) (611,555)

Unpaid obligations, end of year 2,587,585 2,692,558

Uncollected payments:

Uncollected payments, Federal sources, brought forward, October 1 (14,937) (6,559)

Change in uncollected payments, Federal sources 11,852 (8,378)

Uncollected payments, Federal sources, end of year (3,085) (14,937)

Memorandum (non-add) entries:

Obligated balance, start of year $2,677,621 $3,278,905

Obligated balance, end of year $2,584,500 $2,677,621

Budget Authority and Outlays, Net:

Budget authority, gross $23,476,739 $24,769,053

Actual offsetting collections (58,752) (37,675)

Change in uncollected customer payments from Federal sources 11,852 (8,378)

Budget authority, net $23,429,839 $24,723,000

Outlays, gross $23,320,255 $24,740,405

Actual offsetting collections (58,752) (37,675)

Outlays, net 23,261,503 24,702,730

Agency Outlays, Net $23,261,503 $24,702,730

The accompanying notes are an integral part of these statements.
40

NOTES TO THE FINANCIAL STATEMENTS

Note 1: Significant Accounting Policies

(a) Reporting Entity – The FLRA is an independent administrative Federal agency created by 

Title VII of the Civil Service Reform Act of 1978, with a mission to carry out five statutory 

responsibilities: (1) determining the appropriateness of units for labor organization 

representation; (2) resolving complaints of unfair labor practices; (3) adjudicating exceptions 

to arbitrators’ awards; (4) adjudicating legal issues relating to duty to bargain; and (5) 

resolving impasses during negotiations. The agency consists of three components: the 

Authority, the Office of the General Counsel, and the Federal Service Impasses Panel.

(b) Basis of Accounting and Presentation – The financial statements have been prepared to 

report the financial position, net cost of operations, changes in net position, and budgetary 

resources of the FLRA in accordance with the Chief Financial Officers Act of 1990, the 

Government Management Reform Act of 1994, and the Accountability of Tax Dollars Act of 

2002. The statements have been prepared from agency financial records in accordance with 

U.S. Generally Accepted Accounting Principles (GAAP), in accordance with guidance issued 

by the Federal Accounting Standards Advisory Board (FASAB) and the Office of 

Management and Budget (OMB), as prescribed in OMB Circular A-136, Financial 

Reporting Requirements, and pursuant to the requirements of 31 U.S.C. 3515(b). These 

financial statements include all funds and accounts under the control of the FLRA.

The accounting structure of Federal agencies is designed to reflect both accrual and 

budgetary accounting transactions. Under the accrual method of accounting, revenues are 

recognized when earned and expenses are recognized when incurred, without regard to the 

receipt or payment of cash. The budgetary accounting principles, on the other hand, are 

designed to recognize the obligation of funds according to legal requirements, which in many 

cases occurs before an accrual-based transaction takes place. The recognition of budgetary 

accounting transactions is essential for compliance with legal constraints and controls over 

the use of Federal funds. The accompanying financial statements are prepared on the accrual 

basis of accounting.

(c) Budget Authority – The Congress passes appropriations annually that provide the FLRA 

with authority to obligate funds for necessary salaries and expenses to carry out mandated 

program activities. These funds are available until expended, subject to OMB apportionment 

and to Congressional restrictions on the expenditure of funds. Also, the FLRA places 

internal restrictions on fund expenditures to ensure the efficient and proper use of all funds.

(d) Fund Balance with the Treasury – FLRA receipts and disbursements are processed by the 

Department of the Treasury. Fund balances with the Treasury consist of appropriated funds 

that are available to pay current liabilities and to finance authorized purchase commitments. 

No cash is held in commercial bank accounts.

(e) Accounts Receivable – Accounts receivable consists of amounts due from other Federal 

entities and from current and former employees and vendors. Amounts due from the public 
41

are stated net of an allowance for uncollectible accounts that is based on an analysis of 

outstanding receivables balances and past collection experience. No allowance is established 

for intragovernmental receivables, as they are considered fully collectible from other Federal 

agencies.

(f) General Property and Equipment (P&E) – This category consists of equipment and internal 

use software. The basis for recording purchased P&E is full cost, including all costs incurred 

to bring FLRA P&E to and from a location suitable for its intended use. P&E is depreciated 

using the straight-line method over the estimated useful life of the asset. Statement of 

Federal Financial Accounting Standards (SFFAS) No. 10, Accounting for Internal Use 

Software, provides accounting standards for internal use software used by each agency. The 

standards provide for capitalized property to continue to be reported on the Balance Sheet. 

P&E that are not capitalized because they are under the capitalization threshold are expensed 

in the year of acquisition.

The FLRA’s capitalization threshold for individual purchases is $25,000. Bulk purchases of 

similar items that individually are worth less than $25,000, but collectively are worth more 

than $100,000 are also capitalized using the same general P&E categories and useful lives as 

capital acquisitions. Major building alterations and renovations are capitalized, while 

maintenance and repair costs are charged to expense as incurred.

General P&E Category Service Life

Software 3 years

Computer equipment 5 years

Office equipment 7 years

Office furniture 15 years

Leasehold improvements Life of lease

(g) Liabilities – Liabilities represent the amount of monies or other resources likely to be paid by 

the FLRA as a result of transactions or events that have already occurred. No liability can be 

paid, however, absent an appropriation. Liabilities for which an appropriation has not been 

enacted are, therefore, classified as not covered by budgetary resources, and there is no 

certainty that the appropriation will be enacted. Also, the Federal government, acting in its 

sovereign capacity, can abrogate liabilities other than contracts. Liabilities that are covered 

by budgetary resources consist of intragovernmental and public accounts payable and 

accrued funded payroll. Liabilities not covered by budgetary resources in FY 2012 and FY 

2013 consist of accrued and actuarial Federal Employees Compensation Act (FECA) 

compensation and unfunded employee leave.

(h) FECA Liabilities – An accrued FECA liability is recorded for actual and estimated future 

payments to be made for workers’ compensation pursuant to the FECA. The actual costs 

incurred are reflected as a liability because agencies will reimburse the Department of Labor 

(DOL) two years after the actual payment of expenses. Future revenues will be used for their 

reimbursement to the DOL. The liability consists of: (1) the net present value of estimated 
42

future payments calculated by the DOL; and (2) the un-reimbursed cost paid by the DOL for 

compensation to recipients under the FECA.

An estimated actuarial liability for future workers’ compensation benefits is included. The 

liability estimate is based on the DOL’s FECA actuarial model that takes the amount of 

benefit payments over the last twelve quarters and calculates the annual average of payments 

for medical expenses and compensation. This average is then multiplied by the liabilities-tobenefits paid ratios for the whole FECA program for FY 2013. The ratios may vary from 

year to year as a result of economic assumptions and other factors, but the model calculates a 

liability approximately eleven times the annual payments.

(i) Annual, Sick and Other Leave – Amounts associated with the payment of annual leave are 

accrued while leave is being earned by employees, and this accrual is reduced as leave is 

taken. Each year the balance in the accrued annual leave account is adjusted to reflect 

current pay rates. To the extent that current or prior year appropriations are not available to 

finance annual leave, future financing sources will be used. Sick leave and other types of 

non-vested leave are expensed as taken.

Any liability for sick leave that is accrued but not taken by a Civil Service Retirement 

System (CSRS)-covered employee is transferred to the Office of Personnel Management 

(OPM) upon the retirement of that individual. Federal Employees Retirement System

(FERS)-covered employees were not entitled to use unused sick leave for additional service 

credit until October 28, 2009. For retirements effective between October 28, 2009 and 

December 31, 2013, 50 percent of unused sick leave can be used for additional service 

credit. For retirements effective after December 31, 2013, 100 percent of unused sick leave 

can be credited.

(j) Accounts Payable and Other Accrued Liabilities – Accounts payable and accrued liabilities 

represent a probable future outflow or other sacrifices of resources as a result of past 

transactions or events. Liabilities are recognized when they are incurred, regardless of 

whether they are covered by available budgetary resources. FLRA liabilities cannot be 

liquidated without legislation that provides resources to do so.

(k) Net Position – The components of net position are unexpended appropriations and 

cumulative results of operations. Unexpended appropriations include undelivered orders and 

unobligated balances. Undelivered orders reflect the amount of goods and services ordered 

that have yet to be actively or constructively received. Unobligated balances are the amount 

of appropriations or other authority remaining after deducting the cumulative obligations 

from the amount available for obligation. The cumulative results of operations represent the 

net results of operations since inception, the cumulative amount of prior-period adjustments, 

the remaining book value of capitalized assets, and future funding requirements.

(l) Retirement Plans – The FLRA’s employees participate in the CSRS or the FERS. For CSRS 

employees, hired prior to January 1, 1984, the FLRA withholds seven percent of each 

employee’s salary and contributes seven percent of the employee’s basic salary to the CSRS 

Retirement and Disability Fund. These employees may also contribute, on a tax-deferred 
43

basis, to a defined contribution plan – the Thrift Savings Plan (TSP). In 2012, the regular 

Internal Revenue Service limit was $17,000; the limit was increased to $17,500 in FY 2013. 

The FLRA is not required to and does not contribute any matching amounts for CSRS 

employees.

The FERS was established by enactment of Public Law 99-335. Pursuant to this law, the 

FERS and Social Security automatically cover most employees hired after December 31, 

1983. Employees hired before January 1, 1984 elected either to join the FERS and Social 

Security or to remain in the CSRS. For FERS employees, the FLRA withholds 6.2 percent in

old age survivors and disability insurance up to a specified wage ceiling and 0.8 percent of an 

employee’s gross earnings for retirement. In FY 2013, the FLRA matched the retirement 

withholdings with a contribution equal to 13.2 percent of the employee’s taxable salary.

All employees are eligible to contribute to the TSP. For employees under the FERS, a TSP 

account is automatically established. The FLRA is required to make a mandatory 

contribution of one percent of the base salary for each employee under the FERS. The 

agency is required to match the employee’s contribution up to a maximum of five percent of 

his or her salary. Matching contributions are not made to the TSP accounts established by 

CSRS employees. The FLRA does not report on its financial statements information 

pertaining to the retirement plans covering its employees. Reporting amounts such as plan 

assets, accumulated plan benefits, and related unfunded liabilities, if any, is the responsibility 

of the OPM.

FERS employees and certain CSRS reinstatement employees are eligible to participate in the 

Social Security program after retirement. CSRS employees who are 65 or older are eligible 

for Social Security payments (even if they have not retired). In these instances, the FLRA 

remits the employer’s share of the required contribution.

(m) Imputed Financing from Costs Absorbed by Others – The FASAB’s SFFAS No. 5, 

Accounting for Liabilities of the Federal Government, requires that employer agencies 

recognize the full cost of pension, health, and life insurance benefits during their employees’ 

active years of service. The OPM, as administrator of the CSRS and FERS plans, the 

Federal Employees Health Benefits Program, and the Federal Employees Group Life 

Insurance Program, must provide the “cost factors” that adjust the agency contribution rate 

to the full cost for the applicable benefit programs. An imputed financing source and 

corresponding imputed personnel cost is reflected in the Statement of Changes in Net 

Position and the Statement of Net Cost, respectively.

(n) Revenue and Other Financing Sources – The FLRA’s revenues are derived from 

reimbursable agreements (exchange) and a direct, annual appropriation (financing source). 

The FLRA recognizes reimbursable work agreement revenue when earned, i.e., goods have 

been delivered or services that have been rendered. Each reimbursable work agreement 

specifies the dollar value of the agreement and is based on estimated resources needed to 

perform the specified services, whether it is personnel services, including base pay, 

overtime and benefits, or travel and per diem. 
44

The agency receives an annual Salaries and Expenses appropriation from the Congress. 

Annual appropriations are used, within statutory limits, for salaries and administrative 

expenses and for operating and capital expenditures for essential personal property. 

Appropriations are recognized as non-exchange revenues at the time the related program or 

administrative expenses are incurred. Appropriations expended for capitalized property and 

equipment are recognized as expenses when an asset is consumed in operations. The 

FLRA’s annual appropriation for FY 2012 was $24,723,000. The agency’s annual 

appropriation for FY 2013 was $24,723,000, which was reduced by $1,293,161 pursuant to 

0.2 percent across-the-board and sequestration rescissions included in Public Law 113-6.

(o) Expired Accounts and Cancelled Authority – Unless otherwise specified by law, annual 

authority expires for incurring new obligations at the beginning of the subsequent fiscal 

year. The account into which the annual authority is placed is called the expired account. 

For five fiscal years, the expired account is available for expenditure to liquidate valid 

obligations incurred during the unexpired period. Adjustments are allowed to increase or 

decrease valid obligations incurred during the unexpired period but not previously reported. 

At the end of the fifth expired year, the expired account is cancelled and any remaining 

money is returned to the Treasury.

(p) Transactions with Related Parties – In the course of its operations, the FLRA has

relationships and conducts financial transactions with numerous Federal agencies. The most 

prominent of these relationships are with the Treasury, the DOL, the Department of the 

Interior, the Department of Transportation, the Department of Homeland Security, and the 

General Services Administration.

(q) Contingencies – A contingency is an existing condition, situation, or set of circumstances 

involving uncertainty as to possible gain or loss to the agency. The uncertainty will 

ultimately be resolved when one or more future events occur or fail to occur. With the 

exception of pending, threatened, or potential litigation, a contingent liability is recognized 

when a past transaction or event has occurred, a future outflow or other sacrifice of 

resources is more likely than not, and the related future outflow or sacrifice of resources is 

measurable. For pending, threatened, or potential litigation, a liability is recognized when a 

past transaction or event has occurred, a future outflow or other sacrifice of resources is 

likely, and the related future outflow or sacrifice of resources is measurable.

(r) Use of Estimates – The preparation of financial statements in conformity with GAAP 

requires management to make estimates and assumptions that affect the reported amounts of 

assets and liabilities and disclosure of contingent liabilities as of the date of the financial 

statements, as well as the reported amounts of revenues and expenses during the reporting 

period. Actual results could differ from those estimates.

(s) Advances and Prepayments – Advance payments are generally prohibited by law. There 

are some exceptions, such as reimbursable agreements, subscriptions, and payments to 

contractors and employees. Payments made in advance of the receipt of goods and services 

are recorded as advances or prepayments at the time of the prepayments and recognized as 

expenses when the related goods and services are received.
45

Note 2: Fund Balance with the Treasury

U.S. government cash is accounted for on an overall consolidated basis by the Treasury. The 

amounts shown on the Balance Sheet represent the FLRA’s right to draw on the Treasury for 

valid expenditures. The fund balance as shown on the FLRA records is reconciled monthly with

records from the Treasury.

Fund Balance with the Treasury

As of September 30, 2013 2012

General funds $3,488,106 $4,525,095

Other fund types 0 38

Total $3,488,106 $4,525,133

Status of Fund Balance with the Treasury

As of September 30, 2013 2012

Unobligated balance available $67,001 $63,518

Unobligated balance unavailable 836,323 1,783,956

Obligated balance not yet distributed 2,584,500 2,677,621

Non-budgetary fund balance with the Treasury 282 38

Total $3,488,106 $4,525,133

Note 3: Accounts Receivable, Net

The reported amount for accounts receivable consists of amounts owed to the FLRA by other 

Federal agencies (intragovernmental) and the public.

Accounts Receivable, Net

As of September 30, 2013 2012

From Federal agencies, net $0 $1,335

From the public, net 16,742 12,172

Total $16,742 $13,507

Amounts Due from Other Federal Agencies

As of September 30, 2013 2012

Department of Homeland Security $0 $1,335

Total $0 $1,335
46

Note 4: General Property and Equipment, Net

Category

Service 

Life

Acquisition 

Value

Accumulated 

Depreciation

2013 Net 

Book 

Value

2012 Net 

Book 

Value

Software 3 years $258,957 $(258,957) $0 $0

Computer equipment 5 years 497,617 (447,760) 49,857 68,553

Office equipment 7 years 541,273 (474,364) 66,909 119,298

Office furniture 15 years 526,039 (430,173) 95,866 126,112

Leasehold improvements Life of lease 428,172 (428,172) 0 39,200

Total $2,252,058 $(2,039,426) $212,632 $353,163

Note 5: Liabilities Not Covered By Budgetary Resources

Unfunded FECA liabilities consists of workers’ compensation claims payable to the DOL, which 

will be funded in a future period, and an unfunded estimated liability for future workers’ 

compensation claims based on data provided from the DOL. The actuarial calculation is based 

on benefit payments made over twelve quarters, and calculates the annual average of payments. 

For medical expenses and compensation, this average is then multiplied by the liability-tobenefit paid ratio for the whole FECA program.

Unfunded leave represents a liability for earned leave and is reduced when leave is taken. At 

year-end, the balance in the unfunded leave account is adjusted to reflect the liability at current 

pay rates and leave balances. Unfunded leave is paid from future funding sources and, 

accordingly, is reflected as a liability not covered by budgetary resources. Sick and other leave 

is expensed as taken. All other liabilities are considered to be covered by budgetary resources.

Liabilities Not Covered By Budgetary Resources

For the Years ended September 30, 2013 2012

Intragovernmental – Unfunded FECA liabilities $227,025 $240,761

Federal employee benefits – FECA actuarial liability 1,180,558 1,185,256

Unfunded leave 1,412,090 1,519,345

Total $2,819,673 $2,945,362

Note 6: Other Liabilities

Other liabilities in FY 2012 and FY 2013 include interest payment from a customer agency for 

reimbursable travel and payment for responding to Freedom of Information Act requests. 

Payment was deposited into the Treasury’s General Fund.
47

Note 7: Leases

The FLRA has operating leases for rental of office space and equipment. As a Federal agency, 

the FLRA is not liable for any lease terms beyond one year.

Future Minimum Lease Payments

FY Equipment Building Total

2014 $27,912 $1,005,411 $1,033,323

2015 13,527 658,358 671,885

2016 0 554,305 554,305

2017 0 587,248 587,248

2018 0 430,462 430,462

Thereafter 0 1,342,627 1,342,627

Total $41,439 $4,578,411 $4,619,850

Note 8: Commitments and Contingencies

The FLRA is a party in various administrative proceedings, legal actions, and claims brought by 

or against the agency. In the opinion of FLRA management, the ultimate resolution of 

proceedings, actions, and claims will not materially affect financial position or results of 

operations of the FLRA. The agency has examined its obligations related to cancelled FY 2008

authority and believes that it will not have outstanding commitments that will require future 

resources.

Note 9: Intragovernmental Costs and Exchange Revenue

The classification of revenue or cost defined as "intragovernmental" or "with the public" is 

defined on a transaction by transaction basis. Preceding transactions in the lifecycle of a product

will not have an impact on subsequent transactions. If the FLRA purchases goods or services 

from another Federal entity, capitalizes them into inventory, and later resells them to the public, 

the cost of the original purchase of resale assets from the other Federal entity will be classified as 

"intragovernmental" at the time of the purchase. At ultimate sale to the end user, the resulting 

cost of goods will be classified as "with the public." The purpose of this classification is to 

enable the Federal government to provide consolidated financial statements, and not to match 

public and intragovernmental revenue with costs that are incurred to produce public and 

intragovernmental revenue.
48

Note 10: Apportionment Categories of Obligations Incurred: Direct Versus 

Reimbursable Obligations

Obligations Incurred

For the Years Ended September 30, 2013 2012

Direct obligations – Category A $23,584,501 $24,713,002

Reimbursable obligations – Category A 49,541 46,053

Total $23,634,042 $24,759,055

Note 11: Undelivered Orders at the End of the Period

The amount of budgetary resources obligated for undelivered orders at the end of September 30, 

2013 and 2012 was $1,147,067 and $1,259,285, respectively.

Note 12: Explanation of Differences between the SBR and the Budget of the 

U.S. Government

SFFAS No. 7, Accounting for Revenue and Other Financing Sources and Concepts for 

Reconciling Budgetary and Financial Accounting, calls for explanation of material differences 

between amounts reported in the Statement of Budgetary Resources and the actual balances 

published in the Budget of the U.S. Government (the President’s Budget). The FY 2014

President’s Budget, with actual amounts for FY 2012, has been reconciled to the Statement of 

Budgetary Resources. The FY 2015 President’s Budget, with actual amounts for FY 2013, will 

not be published until February 2014.

Note 13: Reconciliation of Net Cost of Operations to Budget

Details of the relationship between budgetary resources obligated and the net costs of operations 

for the fiscal years ended September 30, 2013 and 2012 are shown in the table on the following 

page.
49

Reconciliation of Net Cost of Operations to Budget

For the Years Ended September 30, 2013 2012

Resources Used to Finance Activities:

 Obligations incurred $23,634,042 $24,759,055

 Spending authority from offsetting collections:

 Collected (58,752) (37,675)

 Change in unfilled customer orders 3,920 (5,821)

 Recoveries of prior year unpaid obligations (418,760) (611,555)

Transfers in/out without reimbursement (163,967) 0

 Imputed financing sources 1,360,359 1,495,849

Other 163,682 0

Total Resources Used to Finance Activity $24,520,524 $25,599,853

Resources Used That Do Not Fund Net Cost of Operations:

Change in unfilled customer orders $(3,920) $5,821

 Change in undelivered orders 106,333 502,552

Components of the Net Cost of Operations Which Do Not 

Generate or Use Resources in the Reporting Period:

 Change in non-Federal receivables (3,234) 8,758

 Other financing sources not in the budget (1,360,359) (1,495,849)

 Depreciation and amortization 140,530 172,591

 Future funded expenses (120,990) 7,505

 Imputed costs 1,360,359 1,495,849

 Other expenses not requiring budgetary resources (4,698) 43,950

Net Cost of Operations $24,634,545 $26,341,030
50

REPORT OF INDEPENDENT AUDITORS 

To Chairman Pope

Federal Labor Relations Authority

Report on the Financial Statements 

We have audited the accompanying financial statements of the Federal Labor Relations 

Authority (FLRA), which comprise the balance sheet as of September 30, 2013 and 2012, and 

the related statements of net cost, changes in net position, and budgetary resources, for the years 

then ended.

Management's Responsibility for the Financial Statements 

Management is responsible for the preparation and fair presentation of the financial statements in 

accordance with U.S. generally accepted accounting principles; this includes the design, 

implementation, and maintenance of internal control relevant to the preparation and fair 

presentation of the financial statements that are free from material misstatement, whether due to 

fraud or error. 

Auditor's Responsibility 

Our responsibility is to express an opinion on the financial statements based on our audits. We 

conducted our audits in accordance with auditing standards generally accepted in the United 

States of America; the standards applicable to financial audits contained in the U.S. Government 

Auditing Standards, issued by the Comptroller General of the United States; and Office of 

Management and Budget (OMB) Bulletin No. 14-02, Audit Requirements for Federal Financial 

Statements. Those standards and OMB Bulletin No. 14-02 require that we plan and perform the 

audit to obtain reasonable assurance about whether the financial statements are free from 

material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and 

disclosures in the financial statements. The procedures selected depend on the auditor's 

judgment, including the assessment of the risks of material misstatement of the financial 

statements, whether due to fraud or error. In making those risk assessments, the auditor 

considers internal control relevant to the agency's preparation and fair presentation of the 

financial statements in order to design audit procedures that are appropriate in the circumstances, 

but not for the purpose of expressing an opinion on the effectiveness of the agency's internal 

control. Accordingly, we do not express such an opinion. An audit also includes evaluating the 

appropriateness of accounting policies used and the reasonableness of significant estimates made 

by management, as well as evaluating the overall presentation of the financial statements. We 

believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis 

for our opinion.
51

Opinion on Financial Statements 

In our opinion, the financial statements present fairly, in all material respects, the financial 

position of the Federal Labor Relations Authority as of September 30, 2013 and 2012, and its net 

costs; changes in net position; and budgetary resources for the years then ended.

Consideration of Internal Control

In planning and performing our audit, we considered the Federal Labor Relations Authority's 

internal control over financial reporting as a basis for designing our auditing procedures and to 

comply with the Office of Management and Budget (OMB) audit guidance for the purpose of 

expressing our opinion on the financial statements, but not for the purpose of expressing an 

opinion on internal control and compliance or on management's assertion on internal control 

included in MD&A. Accordingly, we do not express an opinion on internal control over 

financial reporting and compliance or on management's assertion on the effectiveness of the 

entity's internal control over financial reporting or on management's assertion on internal control 

included in the MD&A.

Our consideration of internal control over financial reporting was for the limited purpose 

described in the preceding paragraph and was not designed to identify all deficiencies in internal 

control that might be material weaknesses or significant deficiencies and therefore, material 

weaknesses or significant deficiencies may exist that were not identified. We did not identify 

any deficiencies in internal control over financial reporting that we consider to be material 

weaknesses or significant deficiencies, as defined below.

A deficiency in internal control exists when the design or operation of a control does not allow 

management or employees, in the normal course of performing their assigned functions, to 

prevent or detect and correct misstatements on a timely basis. A material weakness is a 

deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable 

possibility that a material misstatement of the entity's financial statements will not be prevented, 

or detected and corrected, on a timely basis.

A significant deficiency is a deficiency, or combination of deficiencies, in internal control that is 

less severe than a material weakness yet important enough to merit the attention of those charged 

with governance.

We noted other non-reportable matters involving internal control and its operation that we will 

communicate in a separate management letter to FLRA management. 

Compliance With Laws and Regulations

As part of obtaining reasonable assurance about whether the Federal Labor Relations Authority 

financial statements are free from material misstatement, we also performed tests of its 

compliance with certain provisions of laws and regulations for fiscal year 2013. However, 

providing an opinion on compliance with those provisions was not an objective of our audit, and 

accordingly, we do not express such an opinion. The results of our tests of compliance disclosed 
52

no instances of noncompliance or other matters that are required to be reported under 

Government Auditing Standards.

Consistency of Other Information

The information in the Management's Discussion and Analysis is not a required part of the 

financial statements, but is supplementary information required by U.S. generally accepted 

accounting principles. We have applied certain limited procedures, which consisted principally 

of inquiries of management regarding the methods of measurement and presentation of this 

information. However, we did not audit this information and, accordingly, we express no opinion 

on it.

The information in the Chairman's Message, Performance Section, and Other Accompanying 

Information is presented for purposes of additional analysis and is not required as part of the 

financial statements. This information has not been subjected to auditing procedures and, 

accordingly, we express no opinion on it.

Rockville, Maryland

December 6, 2013
53

OTHER ACCOMPANYING INFORMATION

SUMMARY OF FINANCIAL STATEMENT AUDIT

Audit Opinion: Unqualified

Restatement: No

Beginning 

Balance New Resolved Consolidated

Ending 

Balance

Material weaknesses 0 0 0 0 0

SUMMARY OF MANAGEMENT ASSURANCES

Effectiveness of Internal Control over Financial Reporting (FMFIA § 2)

Statement of Assurance: Unqualified

Beginning 

Balance New Resolved Consolidated Reassessed

Ending 

Balance

Material weaknesses 0 0 0 0 0 0

Effectiveness of Internal Control over Operations (FMFIA § 2)

Statement of Assurance: Unqualified

Beginning 

Balance New Resolved Consolidated Reassessed

Ending 

Balance

Material weaknesses 0 0 0 0 0 0

Conformance with Financial Management System Requirements (FMFIA § 4)

Statement of Assurance: Systems conform

Beginning 

Balance New Resolved Consolidated Reassessed

Ending 

Balance

Non-conformances 0 0 0 0 0 0
54

 INSPECTOR GENERAL

MEMORANDUM

DATE: October 23, 2013

TO: Ernest DuBester

Chairman

FROM: Dana Rooney-Fisher 

Inspector General

SUBJECT: Inspector General Identified Management Challenges

This memorandum transmits the key management and performance challenges facing the Federal 

Labor Relations Authority (FLRA) as identified by the Inspector General (IG). 

The FLRA is required to prepare an annual performance report as well as prepare and submit 

audited financial statements to the President, the Office of Management and Budget, and to 

appropriate committees and subcommittees of Congress. The Reports Consolidation Act of 

2000, Public Law 106-531, requires the IG to provide the agency head with a statement that 

summarizes the most serious management and performance challenges facing the agency and 

briefly assess the agency’s progress in addressing those challenges. This statement should 

accompany the agency's annual performance report.

Accordingly, the attached document describes the most serious management and performance 

challenges facing the FLRA along with a brief assessment of management’s progress in 

addressing them. These ongoing challenges include: Human resources shortage; information 

technology security and proper handling of records.

I also noted the above challenges in my prior year report dated October 12, 2012. The agency 

has made progress in addressing these challenges as further described in the attachment. I 

appreciate management’s strong commitment in tackling these challenges and look forward to 

working collaboratively in addressing them.

Attachment

 

 UNITED STATES OF AMERICA

 FEDERAL LABOR RELATIONS AUTHORITY

 WASHINGTON, D.C. 20424-0001
55

Attachment

Challenge: Human Resources shortage 

The U.S. Federal Labor Relations Authority (FLRA) is the sole agency responsible for 

establishing policies and guidance regarding the labor-management relations program for

2.1 million non-Postal, Federal employees worldwide, approximately 1.2 million of whom are 

represented in 2,200 bargaining units. Although the FLRA is a small agency, accomplishing its 

mission, including the timely, quality resolution of disputes, is essential for program 

performance Government-wide. If a labor-management dispute in another agency remains 

unresolved for too long, the mission accomplishment in that agency likely will suffer. The 

Federal Government currently faces significant financial challenges today, especially when 

considering the impacts of sequestration which took effect in Fiscal Year (FY) 2013. Further, 

recent events demonstrate that this fiscal environment may likely require major changes and 

presents challenges that will have a significant impact on the Federal workforce as well as the 

effectiveness and efficiency of agency operations. In addition, President Obama previously 

called for the reorganization of Federal agencies – described as the most aggressive 

reorganization of the Federal Government in at least half a century. These factors, which are 

external to outside of the FLRA's ability to control, are nevertheless key stimulus that can result 

in an increased demand for the FLRA’s services. 

The FLRA's ability to meet its performance goals and to deliver timely and high quality services 

will be critical in facilitating orderly, efficient and effective changes that impact the Federal 

Government workforce which has the potential to generate representation cases, and collectivebargaining may be necessary for the implementation of such changes. In addressing workforce 

disputes that may result, the FLRA has a direct bearing on how well and quickly any 

improvements in Government operations can be effectuated, therefore FLRA is an essential 

component to bringing about change within the Federal Government. 

In the event of a large increase in the agency’s core workload (e.g., an increase in the total filings 

received by the FLRA for review and disposition) as a result of the Government-wide forces and 

potential changes described above, the FLRA's current workforce would face significant 

challenges. Over the past decade or more, the FLRA has not had a significant increase to its 

staffing levels, and out of necessity, the agency has managed its caseload through a variety of 

strategies. While case filings have also declined over that period of time, the agency has recently 

experienced increases in filings in all three of its components. The FLRA professional staffs 

responsible for managing and resolving complex legal matters (e.g., filings) are generally 

attorneys with years of relevant experience. These professional positions require extensive 

education and specialized knowledge and experience, and the work performed by such staff 

cannot be easily shifted to other staffs whom lack the education and training. Accordingly, the 

FLRA is presently faced with the challenge of positioning itself for a significant influx of 

mission critical workload, but at the same time, has very limited ability to hire additional staff 

above current levels. This scenario presents a challenge that the agency's performance (in terms 

of timeliness of processing cases) could be negatively impacted without sufficient FTE, if the 

situation described above results in a significantly increased workload.
56

Progress made:

The FLRA management has proactively tried to address this challenge by taking actions within 

their control. For example, management has used “details”, including temporarily utilizing 

employees from other agency's as well as temporary internal reassignments of existing 

personnel. Further, management has reduced spending to the extent practical on discretionary 

spending on items such as travel and training. However, these actions alone cannot fully 

mitigate the challenge. 

Challenge: Security as well as information technology security

While technological advances enable increases in efficiency, they also can pose additional 

vulnerabilities and threats to agency operations. The agency must remain vigilant in establishing 

a control environment that incorporates monitoring potential Information Technology (IT) risks, 

threats and vulnerabilities and in mitigating them. The agency has undertaken annual reviews of 

the agency’s information security program as required by the Federal Information Security 

Management Act (FISMA). The FISMA requires the FLRA to prepare a report which 

summarizes the findings of such reviews and submit it to the Office of Management and Budget. 

The report is considered non-public. The most recent report contains findings which present 

risks and challenges that confront management and require additional action to be fully resolved. 

Management's progress in addressing these issues has been hampered by the absence of a Chief 

Information Officer (CIO) for much of the fiscal year. Filling the CIO position is critical to 

ensure proper oversight and attention is given to the agency's IT systems and security program.

Progress made:

Management has made significant progress in addressing certain information technology 

challenges identified in prior years. Such progress demonstrates that the FLRA management is 

serious about ensuring the agency maintains a robust information security program. However, as 

of the date of this report, certain issues remain unresolved. Management plans to recruit for a 

new CIO, the position remains vacant. 

Challenge: Proper handling of records (hard copy and electronic) 

Management has made significant progress in addressing this challenge which was mentioned in 

my report dated October 12, 2012. For example, the agency has established a structure for 

receiving and storing electronically filed cases, via its new E-filing system. This is an excellent 

step forward in using technology to enhance operational efficiencies by implementing systems to 

automate paper-based manually intensive processes. However, system automation is one part of 

a comprehensive approach to address the challenge of records management. Industry practices 

dictate that along with implementing new technology, it is imperative that a complete oversight 

or governance process be established which includes documenting agency policies, procedures 

and processes that address the proper handling of all hard copy and electronic records. Although 

new automated systems offer increased capabilities, they also present new internal (management) 

control challenges. The agency needs to ensure various roles (e.g., system administrator) and 

related authorities and capabilities are properly assigned, documented, managed and monitored. 
57

Such written documentation should be kept up-to-date, and this need becomes increasingly 

critical as additional functionality and enhancements are added to the system. Further, although, 

certain types of records do not have legal retention requirements, the policies, processes and 

procedures should clearly and specifically instruct staff on the proper handling and 

management should periodically verify that such policies are being followed. 

Progress made:

The FLRA has made steady progress towards its multi-year system implementation plan goals 

with the completion of its E-filing case system, a very noteworthy accomplishment. 

Management continues working its multi-year agenda to integrate its E-filing and other 

automated systems. Given the resource constraints it is faced with (described above in the first 

challenge noted in my report), the successful implementation of this plan and related system is 

increasingly important as a means to help leverage resources and partially mitigate the challenge 

presented by shortages in human resources.
58

MANAGEMENT’S RESPONSE

Since FY 2009, the FLRA has engaged in a thorough review of agency programs and 

performance. Efforts have been focused on budget-related matters and the development of 

management initiatives to improve the FLRA’s performance of its statutory mission. In addition 

to program performance, the review has included information technology (IT) investments, 

human resources (HR), case processing, and financial management. As a result, in recent years, 

the FLRA has made substantial progress in addressing and resolving deficiencies and challenges 

identified by the Inspector General. The remaining challenges identified by the Inspector 

General include human resources shortage, IT security, and proper handling of records.

With respect to these ongoing challenges, management has made, and continues to make, 

progress towards their resolution with the input of agency leadership, management, and 

employees and their representative union. With respect to human resources matters, the FLRA 

successfully navigated sequestration in FY 2013 and the resulting staffing reduction by using 

creative, immediate solutions to address the challenges. With an ever increasing number of case 

filings and demand for FLRA services, reduced staffing levels may impact mission performance. 

The FLRA will continue its efforts to reallocate and leverage resources to maximize 

organizational performance and to address those areas where limited resources adversely affect 

agency operations. As for IT security, the agency remains vigilant in maintaining a control 

environment that monitors and mitigates risks, threats, and vulnerabilities, and is committed to 

establishing and maintaining a program that is fully Federal Information Security Management 

Act compliant. There are specific agency plans of action in place to ensure such compliance. 

Finally, the FLRA continues its efforts to ensure proper handling of records, noting in particular 

that the ongoing development of a case management infrastructure that supports electronic case 

filing and files will further advance this effort. In FY 2014, the FLRA will continue its work to 

develop and implement policies, processes, and procedures that provide staff with clear guidance 

for handling agency records.

IMPROPER PAYMENTS ELIMINATION AND RECOVERY

The Improper Payments Information Act of 2002, as amended by the Improper Payments 

Elimination and Recovery Act of 2010 (IPERA), requires agencies to annually report 

information on improper payments. The FLRA has reviewed all of its programs and determined 

that none are susceptible to significant improper payment. The IPERA also requires agencies to 

conduct payment recapture audits for each program that expends $1 million or more annually, if 

conducting such audits would be cost-effective. Based on the criteria set forth in Appendix C of 

Office of Management and Budget Circular A-123, the agency has also determined that it would 

not be cost-effective to establish a recovery audit program for its programs that expend more 

than $1 million. Recoveries are not expected to be greater than the costs incurred to identify any 

overpayments.

FEDERAL LABOR RELATIONS AUTHORITY

1400 K Street, N.W.

Washington, DC 20424

www.flra.gov