TABLE OF CONTENTS

PAGE NO.

I. INTRODUCTION

A. Agency Mission.....................................................................6

B. FMCS Services......................................................................6

1. Dispute Mediation – Initial and Successor Contract Negotiations..........6

2. Preventative Mediation............................................................7

3. Arbitration Services...............................................................9

4. Grants Program.....................................................................9

5. FMCS Institute....................................................................10

6. ADR/International................................................................11

7. Youth Conflict Resolution and Peer Mediation..............................12

C. Nature of Collective Bargaining in FY 2002...................................13

D. GPRA Goals Achieved in FY 2002.............................................14

E. Technology..........................................................................16

F. New Initiatives......................................................................17

1. Credentialing of Neutrals........................................................17

2. Resource Center..................................................................17

G. Summary............................................................................18

II. DISPUTE MEDIATION.................................................................20

A. Dispute Mediation Process........................................................20

B. FY 2002 Cases of Significance...................................................20

1. First Energy/International Brotherhood of Electrical Workers 

2. Hershey Foods/Bakery, Confectionary, Tobacco Workers and Grain Millers 

Union 

3. Eaton Aerospace (Vickers Fluid Power)/Communication Workers of America

4. University Hospitals Incorporated/Ohio Nurses Association 

5. Tyson Foods (Iowa Beef Processors) United Food and Commercial Workers

6. Cook County (Chicago, Illinois)/Service Employees International 

Union/American Federation of State and County Municipal Employees 
2

C. Dispute Mediation Program Data............................................23

III. INITIAL CONTRACT NEGOTIATIONS.......................................25

A. Initial Contract Negotiations and Processes................................25

B. Initial Contract Bargaining Data.............................................25

IV. PREVENTATIVE MEDIATION.................................................27

A. Preventive Mediation Process................................................27

B. FY 2002 Cases of Significance...............................................27

1. Kaiser Permanente/United Association of California/Service Employees 

International Union/American Federation of Nurses

2. Frederick County Maryland/Emergency Services Division/Career Fire 

Fighters Association of Frederick/International Association of Fire 

Fighters/Frederick County Volunteer Fire and Rescue Association

3. United States Air Force Material Command/American Federation of 

Government Employees

4. Iowa Association of School Boards (IASB)/Iowa State Education 

Association/Iowa Public Employment Relations Board 

5. Levi Strauss/UNITE

6. City of Los Angeles/Various Unions

C. Preventative Mediation Program Data.......................................29

V. ARBITRATION SERVICES........................................................30

A. Arbitration Services............................................................30

B. FY 2002 Accomplishments....................................................30

C. Arbitration Program Data......................................................31

VI. GRANTS..............................................................................36

A. Grants Program..................................................................36

B. FY 2002 Grant Funding Summary............................................36

VII. FMCS INSTITUTE..................................................................39

A. Purpose and Course Offering...................................................39

VIII. ADR/INTERNATIONAL..........................................................40

A. Services Provided................................................................40
3

1. Domestic Alternate Dispute Resolution.......................................40

2. Regulatory Negotiations..........................................................41

3. International ADR................................................................41

IX. FMCS ORGANIZATION.............................................................43

Office of the Director 

National Office Department 

FMCS Field Organization 

X. LEGISLATIVE AUTHORITY......................................................46
4

To	the	Congress:

It	is	my	distinct	privilege	to	submit	to	you	the	Fifty-Fifth	Annual	Report	of	the	

Federal	Mediation	and	Conciliation	Service	(FMCS)	in	accordance	with	the	

provisions	of	the	Labor-Management	Relations	Act	of	1947.		This	report	details	the	

activities	of	this	agency	in	fiscal	year	2002.

Fiscal	year	2002	commenced	immediately	after	the	terrorist	attacks	of	

September	11,	2001.		The	aftermath	of	9-11,	the	difficulties	faced	by	the	markets,	

corporate	scandals,	the	globalization	of	the	economy,	rapid	technological	changes,	

and	pressures	in	the	health	care	industry	continue	to	burden	the	collective	

bargaining	process.		Despite	these	factors,	we	continue	to	assist	in	the	free	flow	of	

commerce	through	mediation.		We	remain	committed	to	our	goals,	and	to	the	needs	

of	our	customers,	for	mediation	and	alternate	dispute	resolution	services	aimed	at	

resolving	our	nation’s	conflicts	which	can	adversely	affect	commerce.		

I	was	confirmed	as	the	Service’s	15th Director	in	August	2002,	and	was	

immediately	faced	with	the	West	Coast	ports’ dispute.		This	dispute	best	exemplifies	

the	issues	that	continue	to	plague	the	labor-management	community: the	desire of	

employers	to	implement	cost-saving	technological	advancements that	affect	

employees.		The	ports’ dispute	began	in	FY	2002,	and	stalled	the	shipment	of	nearly	

half	the	cargo	entering	and	exiting	the	United	States	by	sea.		

Although	the	ports’ dispute	was	the	most	publicly	known	dispute	during	

fiscal	year	2002,	our	field mediators	were	involved	in	6757	disputes.		In	75%	of	

those	cases,	we	assisted	the	parties	in	achieving	collective	bargaining	settlements. In	

addition,	our	mediators	continue	to	train	the	labor-management	community	on	

methods	designed	to	improve	their	relationship.		These	training	sessions,	known	as	

preventative	mediation,	were	provided	2618	times	during	this	fiscal	year.		Our	

alternative	dispute	resolution	services	to	federal,	state	and	local	governments

continue	to	be	in	wide	demand	as	more	agencies	have	turned	to	FMCS	for	

alternatives	to	courtroom	litigation.
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The	American	workplace	is	changing and	the	Federal	Mediation	and	

Conciliation	Service	will change	with	it	so	that	we	can	continue	to	offer	assistance	to	

employers	and	employees	as	they	confront	the	challenges	of	modern	labormanagement	relations.

Respectfully,

Peter	Hurtgen,	Director	
6

I. INTRODUCTION

A. Agency Mission

For fifty-five years, the Federal Mediation and Conciliation Service (FMCS) has 

carried out its mission of preserving and promoting labor-management peace. The 

FMCS was created by Congress as an independent agency by the Labor-Management 

Relations Act of 1947. A dedicated cadre of highly trained mediators provide conflict 

resolution services to our nation’s employers and their unionized employees and carry 

out the agency’s mission. Their primary mission is to prevent or minimize interruptions 

to the free flow of commerce growing out of labor disputes and to assist these parties in 

improving and maintaining their labor-management relationships. The core mission of 

the Service is dispute mediation, a voluntary process in which mediators serve as thirdparty neutrals to facilitate the settlement of issues in the negotiation of collective 

bargaining agreements.

B. FMCS Services 

In carrying out its mission, the FMCS provides the following services to the 

public: 

1. Dispute Mediation – Initial and Successor Contracts

2. Preventative Mediation 

3. Arbitration Services 

4. Grants Program 

5. FMCS Institute 

6. ADR/International 

7. Youth Conflict Resolution and Peer Mediation

1. Dispute Mediation: Initial and Successor Contract Negotiations

Dispute mediation is a voluntary process that occurs when a third-party neutral 

assists the parties in reaching agreement in contract negotiations. This includes initial 

contract negotiations, which take place between an employer and a newly certified or 

recognized union representing its employees, and negotiations for successor collective 

bargaining agreements. Mediators have no authority to impose settlements; their only 

tool is the power of persuasion. Through dispute mediation, FMCS helps avert or 

minimize the impact of work stoppages on the U.S. economy. 

In FY 2002, FMCS mediators were actively involved in 6757 collective 

bargaining contract negotiations in every major industry and service throughout the 

United States. This is an increase of approximately 300 cases over FY 2001 dispute 

activity. Dispute mediation services are provided not only to the private sector, but also 

to the public sector, including federal agencies, and state and local governments. 

Initial contract negotiations are critical as they are the foundation for the parties’ 

future labor-management relationship. Initial contract negotiations are often more 

difficult than established contract re-negotiations since they frequently follow 

contentious representation election campaigns in which the parties adopt hardened 
7

positions toward each other. Current data indicates less likelihood of agreement on 

initial contracts than in contract re-negotiations, even with the assistance of FMCS 

mediators. There are higher incidences of strikes or lockouts, and threats or actual use 

of permanent replacement workers in initial contract negotiation settings. Additionally, 

unfair labor practice charges can hold up any possibility of agreement and are more 

common in this environment.

For the last several years, FMCS has placed special emphasis on the mediation 

of initial contract negotiations between employers and unions in newly represented 

bargaining units. Under an arrangement with the National Labor Relations Board, 

FMCS is immediately notified of all new union certifications. Our policy is to assign 

all initial contract cases to mediators as soon as we receive the certifications. 

Mediators are proactively involved in assisting the parties and the cases remain open 

for a two year period if the parties do not reach agreement. 

With regard to successor contract negotiations, mediators are in touch with both 

parties prior to commencement of negotiations. The legally required notice of intent to 

commence successor contract negotiations triggers the contact. FY 2002 was a critical 

bargaining year, with major contracts expiring in the following industries: aerospace, 

defense, food manufacturing, construction, hotel service and maintenance, theme park 

entertainment, west coast shipping, apparel, health care as well as federal, state and local 

public employees and educational institutions. 

For FY 2002 data regarding dispute mediation in successor contracts and initial 

contract negotiations, and cases of significance in each category during this fiscal year, 

see Sections II and III.

2. Preventative Mediation

Preventative mediation services are collaborative union-management processes 

that concentrate on improving the parties’ long-term relationships. In preventative 

mediation, FMCS mediators address the workplace relationship by providing education 

and skills training in effective bargaining, communications, joint problem solving and 

innovative conflict resolution. Preventative mediation services are increasingly 

important because labor and management have entered into contracts of longer duration 

than in previous years. Because the parties maintain their contractual relationship for 

longer periods, our preventative mediation services are of particular significance to 

address the workplace relationship issues that arise during the life of the contract. FY 

2002 data shows a slight decrease in the number of preventative mediation services over 

fiscal year 2001, but we anticipate an increase in demand for these services in the 

future. 

Preventative mediation services are broadly defined as collaborative unionmanagement processes designed to improve the party’s relationship on issues of mutual 

interest. When preventative mediation is requested, the mediator determines the 

parties’ needs and designs a program that is specifically tailored for those parties. 

FMCS offers a wide array of services to address workplace problems and they include: 
8

• Orientation to Joint Labor-Management Initiatives: a one day 

workshop providing participants the opportunity to interact and share 

common experiences, discuss the nation’s economic climate, the impact 

of international competition, and the foundation of labor-management 

cooperation.

• Interest Based Bargaining Training: teaches the benefits and 

techniques of a non-adversarial, joint problem solving approach to 

negotiation focusing on the interests that underlie the parties’ positions. 

• Relationship by Objective: aims to improve the parties relationship 

with one another, particularly where the relationship has worsened after 

a contentious representation election, initial contract negotiation, or 

strike. These training sessions are held off site and require a team of 

mediators. 

• Labor-Management Committee: joint labor-management committees 

designed to bring the parties into regular communication. 

• Partners in Change: a two day workshop to explore the organization’s 

current culture, identifying perceptions within the organization, creating 

a vision for the future, and designing a system that effectuates change.

• Committee Effectiveness Training: skills training on how to become 

effective contributors, and includes a guidebook covering effective 

planning, meetings, group problem solving, consensus decision making, 

and effective communication with constituents. Training modules 

include understanding yourself and others, interpersonal skills, group 

dynamics and shared leadership. 

• Labor-Management Worksite Committee Training: extends labormanagement committees from the leadership level to the worksite level,

including the formation of worksite committees, group interactions, 

techniques to manage change and skills to monitor the work of the 

committee. 

• Contract Administration/Steward-Supervisor Training: provides 

front line supervisors and shop stewards with the basic information on 

their roles and responsibilities regarding contract administration, 

grievance processing, the arbitration procedure, and interpersonal 

communications for building cooperative relationships.

• Facilitation Training: focuses on the skills needed to build a successful 

labor-management committee, including understanding adult learning 

and working styles, and planning and facilitating effective meetings. 

• Alternate Dispute Resolution: designed for governmental agencies 

implementing ADR strategies and defines mediation and negotiation, the 

role of the mediator, and practice of ADR skills. 

• Cultural Awareness Skills for Labor and Management: addresses 

cross cultural conflicts in a workplace setting and how to function in a 

multicultural work setting. This program works best when an issue 

arises that is racial or cultural in nature, such as a sudden change in the 

makeup of the workforce, negative cultural undertones during 

negotiations, a bargaining committee that is diverse, or a rise in 

grievances that are racially or culturally motivated. 
9

In addition to these preventive mediation programs, field mediators continuously 

participate in education, advocacy and outreach activities (EAOs). Mediators lecture at 

universities, seminars and conferences and they meet with local leaders in the collective 

bargaining community. Through this outreach activity, the labor-management 

community and the general public gain understanding of the uses of mediation, 

arbitration and collective bargaining and the agency’s services. 

For FY 2002 data regarding preventative mediation and cases of significance 

during this year, see Section IV.

3. Arbitration Services

National labor policy favors the settlement of contractual disputes by arbitration, 

if the parties cannot otherwise settle the matter. When conflicts arise over the 

interpretation or implementation of a contract or contract provision, FMCS assists 

through voluntary arbitration. A professional arbitrator, acting in a quasi-judicial 

capacity, hears arguments, weighs evidence and renders a decision to settle the dispute, 

usually binding on both parties. On request, FMCS Arbitration Services provides the 

disputing parties with a “panel” of qualified, private labor arbitrators from which they 

select the arbitrator to hear their case. The panels are drawn from an FMCS 

computerized nationwide roster of some 1400 labor arbitrators. To join the FMCS 

roster, arbitrators must be approved by an Arbitration Review Board, which meets 

quarterly to consider new applicants, in order to be appointed to the roster by the FMCS 

Director. There is also an arbitration user focus group that reviews and makes 

recommendations to the FMCS Director on changes in arbitration service, policies and 

procedures.

In recent years, we implemented new policies and procedures in our arbitration 

services department. The parties now have the ability to request arbitration panels online and receive them via e-mail, fax, or regular mail. We have revised Form R-43 

(Request for Arbitration Panel) to expand the list of acceptable methods of payment and 

clarified special requirements for panels. Customers are now able to select from 

geographical areas closer to the site of the dispute, thereby reducing the travel costs 

incurred by arbitrators.

The FMCS also holds annual Arbitrator Symposia in Cleveland, Philadelphia, 

Chicago and Seattle. These functions provide FMCS arbitrators with an opportunity to 

discuss and share the latest information about their profession.

For FY 2002 data regarding arbitration services and program data, see Section V.

4. Grants Program

FMCS is authorized by the Labor-Management Cooperation Act of 1978 to 

award grants to support and encourage joint labor-management cooperative activities 

that “improve the labor-management relationship, job security and organizational 

effectiveness.” Congress funds the FMCS Grants Program each year in the agency’s 

appropriation. 
10

The rules, regulations and instructions for preparing grant applications are 

published annually in the Federal Register and include the following information: 

• Program description and scope

• Required program elements

• Grantee selection criteria

• Applicant submission deadline 

• Applicant eligibility criteria

• Dollar range of awards 

• Duration of grant period

• Cash Match requirement 

• Application review process 

Financial assistance is appropriate where it can be demonstrated that the 

creation of the labor-management committee has the potential to: 

• Improve communication between management and labor; 

• Train employees and employers on organizational effectiveness and innovative 

joint approaches; 

• Assist management and labor in solving issues that may not be resolved in the 

traditional collective bargaining process; 

• Eliminate potential problems effecting the economic development of the area; 

• Enhance employee involvement in the decision-making process; or 

• Encourage and improve communication skills

The establishment or continuation of joint committees unite representatives of 

management and labor organizations on a regular basis, and are effective vehicles for 

increasing productivity, improving product quality and resolving workplace issues. In 

the past, committees have focused their efforts on improving labor-management 

relationships, job security, organizational effectiveness, economic development, health 

care cost containment solutions, competitiveness of a region’s hotel industry, economic 

development, and public sector management. All committees must present measurable 

results of their efforts for grant funding. 

 An independent FMCS Grants Review Board, chaired by the Director of 

Labor-Management Grants, preliminarily scores each application. Final selection is 

made by the program director. 

For FY 2002 data regarding the grants program and summary funding, see 

Section VI. 

5. FMCS Institute 

The FMCS Institute commenced operation in 1999. The Institute delivers 

extended training and education to labor and management practitioners in a central 

classroom format. This training is more structured and more conducive to intensive focus 
11

than the Agency’s traditional on-site preventative mediation programs. Our experience 

with Institute course work shows that the training is better handled in a classroom setting, 

away from shop or office floor, in order to maximize communication among all the 

participants. 

 The FMCS Institute offers training in practical conflict resolution skills, and 

provides participants the opportunity to interact with and learn from experienced 

practitioners who use these skills every day. Institute activities have included training in 

labor relations, collective bargaining, dispute resolution skills, arbitrator and arbitration 

skills building, facilitation process skills, group dynamics and multi-party facilitation, 

cultural diversity, negotiation contract skills, information technology and conflict 

resolution, advanced facilitation skills, equal employment opportunity complaint 

mediation skills, and workplace violence prevention. 

Fees received for delivery of training services fund the FMCS Institute. All fees 

collected are utilized to recover expenses and administrative costs of the Institute. 

Training fees charged to customers are set at a level that allows the Institute to provide a 

professionally delivered product from one year to the next.

For FY 2002 data regarding the FMCS Institute and course offerings, see Section 

VII.

6. ADR/International

FMCS is authorized under the Administrative Dispute Resolution Act of 1996 to 

provide mediation/problem-solving techniques in non-labor relations situations. The 

ADR/International department functions in three arenas: (a) domestic ADR; (b) 

International Labor Education and Training; and (c) International ADR. 

(a) Domestic ADR work provides conflict resolution services aimed at helping all 

sectors of government avoid costly and time-consuming litigation to settle disputes by 

assisting parties in creating ADR structures and processes within agencies. We provide 

government with an open and inclusive alternative to traditional rule and policy making. 

Our services in the domestic ADR arena include: 

• Consultation: Initial assessment of customer needs.

• System Design: Analysis of existing mechanisms and design of appropriate 

methods and strategies to establish or improve conflict resolution processes within 

the agency or customer. 

• Education/Training: Programs aimed at educating ADR users and practitioners 

on mediation skills, training for potential customer or agency mediators, and 

mentoring mediator trainees through active ADR cases. 

• Mediation/Facilitation and Convening: Mediation or facilitation of disputes, or 

performing fact finding or convening processes. 

• Regulatory Negotiations/Public Policy Dialogues: Conducting consensus 

focused public policy discussions regarding proposed rules or regulations for 

government agencies. We guide regulatory negotiations aimed at unifying 

government regulators and those affected by the proposed regulation. 
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• Private Sector ADR: Applying ADR principles to conflicts away from the 

negotiation table not directly related to collective bargaining, including 

facilitation of disputes within a corporate of union board, patent or trademark 

disputes, or mediation of issues surrounding voluntary recognition of a bargaining 

unit. 

(b) International Labor Education and Training program: Due to the rapid 

globalization of marketplaces, proliferation of trade pacts and rapid technological 

advances, more countries recognize that industrial relations and conflict resolution 

systems are means of securing economic growth and competitiveness. Countries with 

developing economies may not have developed industrial relations or conflict resolution 

systems. Our mediators provide briefings, training and technical assistance in labor 

relations, mediation and collective bargaining to friendly foreign governments. 

Delegations from other countries are frequent visitors to FMCS National Headquarters in 

Washington D.C. for briefings and training. The International Labor and Training 

Services include: 

• Consultation on dispute resolution systems. 

• Negotiation skills training. 

• The collective bargaining process. 

• Dispute mediation skills, and training in labor dispute resolution. 

• Creation of labor-management committees.

• Introduction to advanced labor-management relations at specific company-union 

sites

• Administration of mediation services. 

• Introduction and use of ADR systems. 

(c) International ADR: The conflict resolution needs of other nations continue to 

evolve and our expertise is sought to provide ADR training and processes to other 

nations. Application of FMCS conflict resolution skills through the International ADR 

department continues to develop in the following areas: 

• Facilitation of consensus building dialogues related to economic growth and 

legal/institutional reform in developing countries; 

• Mediation/negotiation skills building for employees of regional organizations; 

• Negotiation/conflict resolution training for police forces in post-conflict societies; 

• Sponsorship or co-sponsorship of best practices seminars in use of conflict 

resolution;

• Consultation and assistance in establishing international centers of dispute 

resolution; 

• Training of co-mediation teams to mediate NAFTA disputes.

For FY 2002 data regarding ADR and the international program, see Section VIII.

7. Youth Conflict Resolution and Peer Mediation: 

In FY 2000, FMCS began delivering the completed curriculum on Youth Conflict 

Resolution and Peer Mediation. Experience teaches that those who learn conflict 
13

resolution skills early in life carry these skills with them throughout their life. This 

program provides a means of nonviolent conflict resolution for students and staff and is 

designed to assist elementary and secondary school staff to implement a school wide peer 

mediation program. Students, staff and parents are trained in basic conflict resolution 

skills to prepare them to problem solve many of their disputes in a constructive manner. 

A smaller group of students and staff are then trained as mediators. 

The curriculum is designed to teach new skills in managing anger and conflict and 

apply them by direct participation; improve the school environment by helping students 

and staff address underlying conflict that cause rule infractions; reduce the number of 

disputes that become violent or hurtful; and reduce the amount of staff time spent on 

discipline. 

In fiscal year 2002, we partnered with six communities across the nation to 

implement a technology-driven, internet-based program. Using the agency’s TAGS 

technology (see description below), we conducted surveys to identify the factors 

contributing to youth conflict and violence within communities. Using TAGS, 

communities, schools, parents, teachers and students conduct on-line problem-solving 

meetings and surveys in an effort to prevent or eliminate youth violence in their 

communities. While TAGS technology is extremely useful for higher level elementary 

and middle school age children, the technology is too advanced for younger children. As 

a result, we are currently developing a child-friendly CD-ROM, aimed at teaching 

conflict resolution skills to pre-school and elementary school age children. 

A team of academic partners and mediators continue to evaluate this program and 

monitor its successes to ensure its continued assistance to our nation’s communities. 

C. Nature of Collective Bargaining in FY 2002

Fiscal year 2002 was a critical bargaining year, with major contracts expiring the 

following industries: aerospace, defense, food manufacturing, construction, hotel service 

and maintenance, theme park entertainment, west coast shipping, apparel, health care as 

well as federal, state and local public employees and educational institutions. While the 

west coast ports dispute remained in the public eye, mediators were actively involved in 

6757 collective bargaining contract negotiations in every major industry and service 

throughout the United States in FY 2002. This represents an increase of 300 cases over 

FY 2001 dispute activity. 1 With our assistance, 5128 contracts were reached. As a 

result, 75.8% of our dispute cases resulted in negotiated settlements. 

In the aftermath of September 11, a spirit of cooperation existed in the labormanagement community and, as a result, there were fewer work stoppages during this 

fiscal year. There were 445 work stoppages during fiscal year 2001, but that number 

substantially decreased during fiscal year 2002 to 327. Nevertheless, contracts continued

 1

 It is interesting to note that FY 2002 saw an increase in dispute work over the prior year, despite the 

terrorists acts of September 11. To further analyze this issue, we compared the number of contracts that 

expired in FY 2001 with those that expired in FY 2002. The numbers show that there were 37,646 

contracts that expired in FY 2001, compared to 45,339 that expired on FY 2002. This could explain the 

increase in the number of dispute cases we had in FY 2002. A greater number of expiring contracts is 

directly proportional to an increase in dispute assignments. 
14

to expire and the Agency played a role in resolving significant disputes. We resolved a 

defense-related dispute involving Lockheed Martin’s employees and also resolved a work 

stoppage among thousands of employees employed at two Disney premier hotels serving 

VIP visitors and guests. We settled strikes involving 6,000 court–system employees of 

Cook County, Illinois, and 3,000 employees of Hershey Foods. 

Although we assist the parties in resolving strike situations, our primary mission 

is to avoid work stoppages altogether by achieving negotiated settlements. We averted 

strikes by 185,000 employees of United Parcel Service; 55,000 health care workers 

employed by the League of Voluntary Hospitals in New York City; 40,000 employees in 

the Las Vegas casino industry; 2,000 employees of Tyson Foods; 887 nurses employed 

by University Hospitals in Cincinnati; and 385 employees of Eaton Aerospace. 

D. GPRA Achievements: 

Government Performance and Results Act requires all federal agencies to identify 

performance goals. For every service provided, we identified specific goals for fiscal 

year 2002. Although our 2002 GPRA performance was previously submitted to 

Congress in our FY 2004 budget submission, our achievements are reported here as well. 

To the extent that the Agency fell short of its GPRA goals in any of the below-noted 

areas, the Agency’s GPRA 2002 report explained the factors impacting our ability to 

achieve certain goals. Those factors are reiterated here in footnotes.

Service Goals/Objectives Actual Performance

Dispute Mediation 1. Close 14,740 cases 2. Closed 15,256 cases

2. Assign 32.9% of active 

cases2 2. Assigned 35% of active cases

Arbitration Services 1. Provide 19,021 panels 1. Provided 18,885 panels.

2. Average number of days 

between receipt of request 

and panel provided should 

not exceed 5 workdays

2. Average workdays 6.85 

from receipt of panel 

request to panel provided3

3. 6 National or Regional 

training conferences for 

arbitrators and users 

3. 5 training conferences 

provided

Domestic ADR 1. Close 793 ADR cases 1. Closed 1,114 cases 

2. Monitor number of 

participants exposed to 

ADR

2. 6,289 participants 

exposed to ADR 

 2

 An active case is defined as one where an F-7 has been filed. However, not every case is assigned to a 

mediator. We assign cases where the bargaining unit is in excess of 15 or the case involves an initial 

contract. 

3 Arbitration Services was severely impacted by the anthrax incidents in Washington, D.C. Mail was 

delayed for months so that it could be irridiated by the Postal Service which resulted in the delay in 

furnishing panels. 
15

Service Goals/Objectives Actual Performance

3. Settle 60% of non-EEO 

ADR 

3. 60% of non-EEO settled 

4. Settle 52% of EEO cases 4. Settled 57.1% of EEO 

cases 

Regulatory Negotiations 1. Close 7 regulatory 

negotiations 

1. Closed 44

2. Assist 120 organizations 2. Assisted 40 

organizations

International ADR 1. Assist 70 foreign 

governments 

1. Assisted 73 foreign 

governments 

FMCS Institute 1. Provide 10 courses 1. Provided 12 courses 

Grants Program 1. Provide 20 grants to 

labor-management 

committees 

1. Provided 18 grants 

2. Determine percentage of 

committees sustained 

beyond grant period 

2. 66% of labormanagement committees 

remained active past grant 

period 

Regional LaborManagement Conferences 1. Conduct 51 Agencysponsored conferences at 

regional level 

1. Conducted 75 Agencysponsored conferences at 

the regional level

In addition to the above chart, it should be noted that the Agency continues its 

success rate in dispute cases. In this fiscal year, 76% of our dispute mediation cases

resulted in settlement. Although we were unable to secure collective bargaining 

agreements in 24% of our cases, this does not mean that we were not otherwise 

successful. In this regard, the mediator could have assisted the parties in reducing the 

number of open or unresolved issues. While we could not persuade the parties to reach 

agreement in 24% of the cases, only 4.86% of those cases resulted in a work stoppage. 

Avoidance of a work stoppage is a measure of success. If only 4.86% of our mediated 

cases resulted in a work stoppage, the mediation process has succeeded to a large extent. 

Another important measurement of success includes the number of times the 

labor-management community consented to a mediator’s intervention. As noted above, 

not every case is assigned to a mediator. Once a case is assigned, the mediator contacts 

the parties to offer his/her assistance. Even where cases are assigned to mediators and the 

mediator offers assistance, the parties must consent to the mediator’s intervention. 

 4 There is an increase in the number of private and public faciliators to perform the highly technical task of 

faciliating regulatory negotatiations. Some of the Agency’s work has gone to other mediators.
16

Mediation is a voluntary process and even a skilled mediator cannot intervene in the 

absence of consent. 

Bearing this in mind, in fiscal year 2001, we assigned 19,116 cases to mediators. 

It is presumed that, in each case, the assigned mediator contacted the parties and offered 

his/her services to resolve the dispute. Of those 19,116, the parties accepted mediation 

6424 times, roughly 33.6%. In fiscal year 2002, the mediation process fared better: we 

assigned 19,303 cases, and the parties consented to mediation 6,757 times, an increase to 

35%.5 The Agency will continue to educate the public about the mediation process and 

its advantages in order to increase the number of situations where our services can be 

utilized and work stoppages are avoided. 

E. Technology: 

In FY 2000, the agency introduced Technology Assisted Group Solutions System 

(TAGS). The TAGS system uses a powerful network of mobile computers and 

customized software that skilled mediators use to solve problems more effectively, help 

groups brainstorm, gather and organize information, prioritize, evaluate and build 

consensus faster than traditional group meetings. 

Use of TAGS is economically sound for two reasons: (1) the technology requires less 

face-to-face time and allows negotiations to take place between parties that are 

geographically separated, thereby saving travel costs; and (2) it reduces the number of 

days required for face-to-face meetings because it increases the efficiency of decisionmaking. 

We have also incorporated TAGS technology into the Agency’s culture. We use 

it to communicate with our field offices, conduct surveys, and lead focus groups. We 

also use it to share documents, presentations and other items that might be useful for field

communications. 

1. Electronic Conference Centers: 

We continue to maintain seven electronic conference centers (ECCs) that 

incorporate TAGS technology. These ECCs are located in Newark, Minneapolis, 

Oakland, Cleveland, Atlanta and Washington D.C. While these centers are designed to 

be stationary, they have mobile capacity and can be shipped to customer locations when 

needed and can be combined with equipment from other ECCs to accommodate larger 

groups. Additionally, the ECCs can be linked electronically. Each ECC has 14 laptops 

and most have mobile servers available to them, all of which have been shipped around 

the country when parties request it. 

 5 As indicated above in footnote 1, the increase in dispute cases appears to be linked to the increase in the 

number of contract expirations this fiscal year. 
17

2. Academic Partnerships:

In FY 2001, the Agency began academic partnerships with universities, colleges 

and/or institutes that allow us to share research, curricula, internships, and mentoring 

opportunities. Researchers at academic institutions have developed theories of dispute 

resolution techniques and new approaches to collaborative systems. In order to benefit 

from the ongoing knowledge that the academic world can provide, we continue to 

develop relationships with the following institutions, some of whom maintain a TAGS 

ECC: 

• The Usery Center at Georgia State University (also an ECC); 

• The Kennedy School at Harvard (also an ECC); 

• North Texas University (also an ECC); 

• The School for Conflict Management at George Mason University 

• The Strauss Institute at Pepperdine

• Sullivan University (also an ECC) 

• Southern Illinois University (also an ECC)

• The ADR and Law Schools at the University of Missouri 

F. New Initiatives:

1. Registry of Neutrals

In addition to our collaborative efforts with academic institutions, the FMCS 

embarked on a credentialing initiative in fiscal years 2000 and 2001 that has continued in 

fiscal year 2002. We have considered establishing a registry of neutrals who could 

accept employment-related disputes (i.e., EEO cases) where this Agency might be unable 

to assign a mediator to attend to that dispute. Accordingly, we explored methods for 

referring employment-related disputes to private neutrals, and for maintaining confidence 

in the referral and in the quality of services provided by the neutral. 

We convened focus groups in fiscal years 2000, 2001 and 2002, among 

academicians, practitioners, alternate dispute experts, and FMCS commissioners and 

managers, to determine how a registry of neutrals can be established and utilized. The 

focus groups discussed criteria for selection, procedures for selection, and procedures to 

request or select a neutral from our roster. Based on all of the above, we have developed 

the following plan to build a registry or roster of neutrals: 

• First Step: Applications for inclusion on the roster will be accepted during the 

last quarter of FY 2003. 

• Second Step: Applications will be reviewed and placement on the roster is based 

on a flexible point system. An applicant must receive a minimum number of 

points for acceptance as an FMCS neutral. Points are awarded for: 

- experience in handling alternative dispute resolution cases; 

- educational background in alternative dispute resolution processes; 
18

- work experience in handling employment related conflicts; and 

- educational experience in employment related areas. 

• Third Step: FMCS Institute will develop classes and programs to satisfy the 

educational requirements for initial inclusion on the roster, although applicants 

may satisfy the educational requirements through courses taken at other academic 

institutions. 

• Fourth Step: Registry members will be required to accumulate continuing 

education hours, including ethics and/or professional education hours. The FMCS 

Institute will provide classes to meet the continuing education requirement for 

retention on the registry. 

• Fifth Step: A consumer complaint system will be developed for receiving and 

evaluating complaints regarding a neutral, and for checking the effectiveness of 

the process. 

As of this writing, the registry of neutrals program has been published in the 

Federal Register, inviting comment by the public. 

2. Resource Center: 

In fiscal year 2002, we completed The Resource Center, an on-line resource 

available to field mediators via the FMCS intranet. The Resource Center provides 

electronic access to books, articles, preventive mediation training materials, and videos 

on labor relations and collective bargaining, labor-management partnerships, conflict 

resolution, negotiated rulemaking and, resolution of EEO and ADA disputes. The 

Resource Center has sample contract language used in different industries throughout the 

country. Our goal is to improve the quantity of tools available to assist mediators in their 

work by providing a mediator resource kit. This kit will include documentation on joint 

labor-management process mission statements, examples of labor-management education 

programs, exercises for facilitating meetings, a rich array of case studies and case study 

summaries, an assortment of assessment and evaluation tools used in joint labormanagement programs, joint process contract language, and materials on alternative 

bargaining processes and alternative dispute mechanisms. 

G. Summary

All FMCS activity is aimed at promoting and improving the conflict resolution 

and collective bargaining processes in the United States. This helps American businesses 

become and remain more competitive in the international marketplace and increases the 

quality of working life of American workers. Through dispute mediation, FMCS averts 

or minimizes the impact of work stoppages on the U.S. economy, either in initial 

bargaining relationships, or in mature bargaining relationships. Preventive mediation 

services offers labor and management the skills to improve long-term workplace 

relationships. Arbitration services provides the internal jurisprudence that helps the 

parties administer their collective bargaining agreements. The grants program promotes 

innovative, joint approaches to building effective labor-management relationships. 

Through alternative dispute resolution services, FMCS helps government agencies reduce 
19

the likelihood of litigation, speeds up federal processes, and improves the delivery of 

regulated government services. Our international services offers training to foreign 

governments in these same techniques, promoting the establishment of sound labormanagement relations and conflict resolution systems in strategic areas of the world. 

While there are fewer cases involving work stoppages in recent years, strikes and 

lockouts that do occur are often more protracted, difficult, and contentious. The 

complexity of issues in today’s collective bargaining arena require FMCS mediators to 

play increasingly important roles in critical negotiations and in guiding the parties to 

constructive agreements. 
20

II. DISPUTE MEDIATION: 

A. Dispute Mediation Process: 

In collective bargaining, Dispute Mediation is a voluntary process which occurs 

when a third-party neutral assists the two sides, or parties, in reaching agreement in 

contract negotiations. This includes initial contract negotiations, which take place 

between an employer and a newly certified union representing its employees, and 

negotiations for successor collective bargaining agreements. 

In dispute mediation, FMCS mediators are in touch with both parties even before 

negotiations actually begin. The legally required notice of intent to open a collective 

bargaining agreement triggers the contact. During negotiations, effective mediators use 

knowledge of the parties and issues "on the table" to guide negotiators through potential 

deadlocks to a settlement acceptable to both sides. Mediators may make suggestions, and 

offer procedural or substantive recommendations with the agreement of both parties. 

However, they have no authority to impose settlements. Their only tool is the power of 

persuasion. Their effectiveness derives from their status as respected neutrals, their 

acceptability to the parties, their broad knowledge and experience in the process of 

collective bargaining, and, especially, the quality of their ideas, suggestions and 

perspectives. 

B. FY 2002 Cases of Significance:

1. First Energy/International Brotherhood of Electrical Workers: 

The relationship between First Energy, a nuclear power plant, and the International 

Brotherhood of Electrical Workers became increasingly adversarial when the company, 

as a successor employer assuming the terms of the collective bargaining agreement, laid 

off 124 union members. When contract negotiations commenced, the company sought 

contract terms that paralleled its other locations, and wanted increasing flexibility to 

improve efficiency. The union viewed those positions as seeking significant concessions 

that would impact employees’ quality of life. The parties had 15 negotiations sessions 

without a mediator and failed to reach agreement on any contractual provision. A 

number of mediators held 20 negotiation sessions that narrowed the issues, but 

nevertheless some issues remained open. When the company proposed its last offer, the 

union rejected it, and thereafter, the company suspended negotiations. Although the 

membership voted to strike, the mediators prevailed on the parties to return to the table, 

and after two lengthy bargaining sessions, a contract was reached and ratified by the 

membership, averting a strike at the nuclear power plant. 

2. Hershey Foods/Bakery, Confectionary, Tobacco Workers and Grain Millers 

Union: 

 The parties in this case negotiated under the terms of an expired collective 

bargaining agreement, and ultimately reached an agreement which was not ratified by the 

membership. After the intervention of the mediator, the parties reached a second 

agreement, which also was rejected by the membership. A strike commenced, but 
21

throughout, the mediator maintained contact with the parties, exploring alternative 

solutions. When the strike continued for more than a month, the mediator held marathon 

negotiation sessions and reached a tentative agreement. This time, the agreement was 

ratified by the membership and the 44 day strike ended. 

3. Eaton Aerospace (Vickers Fluid Power)/Communication Workers of America: 

Eaton Aerospace manufactures hydraulic pumps and motors for airplanes. Due to 

the uncertainty of the airline industry in the wake of September 11, this company’s future 

was equally uncertain and the pressure pervaded the negotiations. The mediator attended 

many negotiation sessions, and although the talks were difficult, they progressed and the 

parties reached agreement. The agreement was rejected by the membership because they 

were dissatisfied with the wage package and changes to long-standing work rules. The 

company changed its economic package, but refused to change the language regarding 

the work rules. When the membership rejected the second agreement, the mediator 

explained to the parties that the language regarding work rules impeded ratification. 

After a series of lengthy sessions, the parties ultimately revised the language and the 

contract was ratified. 

4. University Hospitals Incorporated/Ohio Nurses Association: 

University Hospital Inc., the largest hospital in the Cincinnati area, employs 887 

nurses. Staffing shortages plagued this negotiation and the shortages were directly linked 

to mandatory overtime issues. Frustration mounted when no agreement was reached, and 

the membership voted to strike. The hospital indicated that it would close 20 of its 22 

operating rooms and reduce bed space from 400 to 50 if the strike proceeded as 

scheduled. The mediator convinced the parties to continue negotiation during the ten 

day period leading up to the strike. The parties met for 5 consecutive days, for 12 to 14 

hours every day, and an agreement was reached 48 hours prior to the commencement of 

the strike that would have resulted in significant disturbance in patient care. 

5. Tyson Foods (Iowa Beef Processors) United Food and Commercial Workers: 

Tyson Foods purchased an Iowa Beef Processor plant in Waterloo, Iowa, where 

2,000 union members work. The parties rejected mediation during their negotiation and, 

although far apart, they reported slow progress. The company submitted its last and final 

offer, which was rejected by the membership and a strike was authorized. The parties 

then consented to mediation, and two days of intense negotiations focused on the primary 

issue of wages, health insurance and contract duration. A new agreement was reached 

and ratified by the membership, averting a strike. 

6. Cook County (Chicago, Illinois)/Service Employees International 

Union/American Federation of State and County Municipal Employees: 

Over 11,000 employees of Cook County are employed in three different 

bargaining units. AFSCME represents 6,000 court-system employees (including public 
22

defenders and judicial clerical staff), and SEIU represents the remaining 5,000 employees 

in hospitals and clinics throughout the county. After nine months of bargaining without 

mediator assistance, the unions set a deadline for a one-day strike to pressure the county. 

Several mediation sessions were held with a team of mediators while the strike deadline 

loomed, and the issues narrowed to wages, health insurance and retroactivity of wages. 

Eventually, agreements were reached covering the SEIU units, but the AFCSME unit 

struck, effectively shutting down the court system. After a number of one day strikes, 

AFCSME returned to the table and reached agreement. 
23

C. Dispute Mediation Program Data

Intake

Fiscal Years 1998 Through 2002 1998 1999 2000 2001 2002

 Union and Employer Notices 6 50,170 36,854 34,038 33,344 40,677

 NLRB and FLRA Certifications7 1,750 1,631 1,492 1,446 1,389

 Public Sector Board Requests8 207 198 191 152 173

 Union and Employer Requests9 1,872 1,903 2,521 2,704 3,100

Total 53,978 40,586 38,242 37,646 45,339

Case Numbers Issued

Fiscal Years 1998 Through 200210 1998 1999 2000 2001 2002

27,802 25,676 26,323 25,071 25,282

Case Numbers Assigned

Fiscal Years 1998 Through 200211 1998 1999 2000 2001 2002

20,263 19,200 19,574 19,116 19,303

Cases Closed Fiscal Years 1998 

Through 200212 1998 1999 2000 2001 2002

 By consolidation after assignment 13 972 685 1,125 619 727

 By Final Report with meetings 14 5,784 6,188 6,321 6,424 6,757

 By Final Report with no meetings 15 13,011 12,422 13,291 12,107 10,861

Total 20,139 19,295 20,737 19,150 18,345

 6 Notifications to the Service by one or both parties desiring to modify a contract that is expiring, or for a 

specific reopening of an existing contract.

7 Notifications from these two agencies regarding certification or recertification of bargaining units. 

Bargaining for an initial contract usually follows such certifications. 8 Requests for mediation assistance from public sector parties where a state has a Public Sector Board with 

jurisdiction over labor contracts, but no state mediation service is available.

9 Requests from the parties for mediation assistance where no notification to the Service has been filed. 10 Case numbers assigned to notifications, certifications, and requests received by the Service. Some 

notifications are subsequently consolidated into a single case with a specific case number; therefore, the 

lower total of case numbers issued when compared to the intake.

11 Cases assigned to a mediator. The decision to assign a case involves many factors and not all cases are 

assigned.

12 Closed by Final Report filed by the mediator assigned to the case or by consolidation of a case with other 

cases after assignment. 

13 Some caes are subsequently consolidated after assignment where it is determined that multiple parties 

will be involved in the same negotiations. 

14 Cases closed where the mediator met with both parties on one or more occasions. 15 Cases closed where mediation assistance did not require any meetings with the parties, but where the 

mediator was in contact with the parties during the negotiations. 
24

Dispute Meeting Conferences

Fiscal Years 1998 Through 2002 16 1998 1999 2000 2001 2002

17,923 19,329 17,837 17,933 17,920

Work Stoppage Information

Fiscal Years 1998 Through 200217 1998 1999 2000 2001 2002

 Work stoppages beginning in the

 fiscal year 421 362 400 432 308

 Work stoppages in closed cases

 in the fiscal year 405 411 392 445 327

 Average duration of work stoppages

 in closed cases (number of days) 43.7 50.5 39.0 40.7 53.7

Contract Mediation Analysis By Sector

Fiscal Years 1998 Through 2002 1998 1999 2000 2001 2002

INTAKE 53,978 40,586 38,242 37,646 45,339

CASE NUMBERS ISSUED

 Private Sector 26,006 23,856 24,386 23,135 23,170

 Public Sector 1,145 1,141 1,216 1,185 1,362

 Federal Sector 649 678 720 750 749

ASSIGNED

 Private Sector 18,487 17,444 17,681 17,241 17,266

 Public Sector 1134 1,089 1,168 1,139 1,296

 Federal Sector 641 666 725 739 741

CLOSED CASES18

 Private Sector 18,036 17,394 18,786 17,219 16,331

 Public Sector 1,105 1,199 1,209 1,150 1,297

 Federal Sector 626 701 742 781 717

 16 The number of meetings in closed dispute mediation cases where a mediator was present in a meeting 

between the parties. 

17 The Bureau of Labor Statistics reports work stoppages over 1,000 employees. FMCS reports all work 

stoppages. 

18 Excludes cases closed by consolidation after assignment. 
25

III. INITIAL CONTRACT NEGOTIATIONS:

A. Initial Contract Negotiations and Processes: 

Initial contract negotiations are critical because they are the foundation for the 

parties’ future labor-management relationship. A bad start in relations between the 

employer and the union may be felt for years afterward, and ultimately injure the 

economic health of the organization. Initial contract negotiations are often more 

difficult than established successor contract since they frequently follow contentious 

representation election campaigns. 

Negotiations can be further complicated by one or both parties’ inexperience in 

collective bargaining and labor-management relations. Current data indicates less 

likelihood of agreement on initial contracts than in successor contract negotiations, 

even with the assistance of FMCS mediators. There are higher incidences of strikes or 

lockouts, and permanent replacement workers are used with greater frequency during 

initial contract negotiations. Unfair labor practice charges are more common in this 

environment and can deter an agreement. 

For the last several years, FMCS has placed special emphasis on mediation of 

initial contract negotiations between employers and newly certified or recognized 

bargaining units. Under an arrangement with the National Labor Relations Board, 

FMCS is immediately notified of all new union certifications. It is our policy that all 

initial contract cases are promptly assigned for mediation, and that mediators make 

every effort to become actively involved in assisting the parties in achieving 

agreements.

Since 1996, FMCS maintained a rule requiring all initial contract cases remain 

open for two years pending an agreement between the parties, or the closing of the 

case for other reasons. 

B. Initial Contract Bargaining Data

Initial Contract Bargaining FY 98 FY 99 FY2000 FY2001 FY2002

Private Sector initial contract cases 

received:

1,800 1,715 1715 1,745 1,486

Assigned to mediators: 1,730 1,657 1,677 1,702 1,458

Assigned from NLRB certifications: 1,503 1,397 1,296 1,282 1,185

Assigned from other sources:

 (e.g. voluntary recognition) 227 260 381 420 273

Cases closed by FMCS:

 (Mediated and non-mediated) 597 661 867 1,892 1,361
26

Mediated cases closed with agreement 

reached:

119 137 231 360 243

 Percentage of mediated cases 68.4 47.9 52.9 55.1 50.3

Mediated cases closed without agreement 

reached:

55 149 206 293 240

 Percentage of mediated cases19 31.6 52.1 47.1 44.9 49.7

Non-mediated cases closed with 

agreement reached:

277 249 255 676 538

 Percentage of non-mediated cases: 65.4 66.4 59.3 54.6 61.3

Non-mediated cases closed without 

agreement reached:

146 126 175 561 339

 Percentage of non-mediated cases20 34.5 33.6 40.7 45.3 38.7

Percentage of mediated and non-mediated 

cases

 Closed with agreement reached:

66.3 58.3 56.0 54.8 57.4

Closed cases involving ULP charges21

filed by either party:

65 75 128 263 221

Closed cases involving work stoppages: 24 19 24 43 29

Closed cases involving work stoppages 

with 

 Agreement reached:

10 10 14 21 20

Average number of days between statutory 

notice

 Receipt by FMCS and closure:22 

175 166 176 85 75

Average number of days for cases carried 

over

 And closed in next fiscal year:

337 351 363 432 396

Assigned cases carried over to next year: 1,416 1,001 813 792 784

 19 Cases closed with agreement reached occur with final agreement on an initial contract. 20 Cases closed without agreement occur after two years if agreement has not been reached on initial 

contract. 

21 Unfair labor practices. 22 For cases closed in the same fiscal year they are received.
27

IV. PREVENTIVE MEDIATION: 

A. Preventive Mediation Process:

In today's changing workplace and economic environment, business organizations 

and unions recognize that the quality of the labor-management relationship is an 

important factor in an organization's ability to compete. As a result, the role of federal 

mediators has evolved beyond traditional crisis intervention during the last few days of 

collective bargaining negotiations. More frequently, mediators are involved during the 

life of a contract to address workplace issues between the parties, and train both sides in 

effective bargaining, communications, joint problem solving and innovative conflict 

resolution methods. Increasingly, FMCS offers a broader range of services to respond to 

changing customer requirements. These "preventive mediation" (PM) services are 

collaborative union-management processes and are as important as our dispute mediation 

services.

B. FY 2002 Preventative Mediation Cases of Significance:

1. Kaiser Permanente/United Association of California/Service Employees 

International Union/American Federation of Nurses: 

With our assistance, the Los Angeles Metro Kaiser Permanente operation 

created 20 labor-management partnership committees to deal with ongoing disputes in 

different departments. Using interest-based problem solving techniques to identify 

issues and resolve persistent issues that plagued their relationship, FMCS has trained 

approximately 1000 employees, managers and union leadership in cooperative efforts 

designed to improve the relationship between the parties. 

2. Frederick County Maryland/Emergency Services Division/Career Fire 

Fighters Association of Frederick/International Association of Fire 

Fighters/Frederick County Volunteer Fire and Rescue Association: 

Frederick County has one of the country’s largest fire fighting departments. 

The parties sought a relationship-by-objective program to improve and create a better 

working environment. Elected officials participated in the training as well. Although 

the parties relationship improved, problems remained and a follow up training session 

was conducted. This time, the parties elected the use of TAGS to sort through 

information and brainstorm. The participants accomplished their objectives in only 

three days, and created a code of conduct and a problem solving process when disputes 

arise. 

3. United States Air Force Material Command/American Federation of 

Government Employees: 

AFGE represents 46,000 employees in 10 different bargaining units employed 

by the United States Air Force. These parties have an adversarial history; their last 

round of negotiations went to the Federal Impasse Panel and required 6 years of 

litigation. To avoid protracted litigation with a successor contract, the mediator 
28

suggested interest based bargaining. The parties received extensive training in interest 

based bargaining techniques and ultimately, the parties utilized the same mediator to 

negotiate a successor agreement, requiring only 3 months of bargaining. 

4. Iowa Association of School Boards (IASB)/Iowa State Education 

Association/Iowa Public Employment Relations Board: 

Iowa State education stakeholders filed a joint request for a labor-management 

grant. The grant was awarded and a labor-management partnership committee was 

built with the express purpose of educating school board members, administrators and 

teachers in the principles of interest based bargaining. More than 530 individuals, 

representing 88 school districts, participated in one of five regional conferences held 

throughout the state. Intensive interest based bargaining training was offered to 

another 38 teams and the training was jointly provided by FMCS mediators and 

members of the state partnership committee. In the end, twelve local school districts 

utilized interest based bargaining to resolve their successor contracts and reported 

great success. 

5. Levi Strauss/UNITE: 

Two task forces were charged with studying the company’s distribution 

processes and recommending changes to improve efficiency. The union and the 

employer approached FMCS to provide committee effectiveness training, with an 

emphasis on analytical tools, interest based problem solving and consensus decision 

making. The training assisted the task force in preparing and submitting their 

recommendations for improvements to efficiency. 

6. City of Los Angeles/Various Unions: 

Employees of the City of Los Angeles were poised to form a labormanagement committee in certain city departments. We were approached to provide 

training on interest based bargaining theory and practice. Training was provided 

separately to labor representatives and management representatives. Thereafter, we 

provided joint training to both groups to coach the labor-management committee 

through any issues. The training was so successful that the city’s goal is to implement 

labor-management committees in every city department. 
29

C. Preventive Mediation Program Data

Preventive Mediation Cases

Fiscal Years 1998 through 2002 23 1998 1999 2000 2001 2002

Assigned 24 2,776 2,891 2,782 2,629 2,610

Closed by Final Report 25 2,813 2,954 2,792 2,655 2,618

Education, Advocacy and Outreach Cases

Fiscal Years 1998 Through 2002 26 1998 1999 2000 2001 2002

Assigned 5,797 5,518 5,504 5,436 5,800

Closed by Final Report 5,932 5,626 5,621 5,645 5,881

 23 Preventive mediation involves the assistance of a mediator where a party or parties desires such help in 

improving the relationship during the term of the contract. Such assistance may include training, arranging 

labor-management committees, and special programs. 24 Cases assigned to a mediator. 25 Closed by a Final Report filed by the mediator. 26 Education, Advocacy and Outreach involves mediator meeting with various members of the public to 

discuss and/or explain the processes of mediation.
30

V. ARBITRATION SERVICES:

A. Arbitration Services: 

In collective bargaining, voluntary arbitration is the preferred method of 

settling disputes over contract interpretation or application. Since its creation, FMCS 

provided access to voluntary arbitration services. Rather than using full-time 

government employees, the Service maintains a roster of the nation’s most 

experienced private professional arbitrators who have met rigid FMCS qualifications. 

Upon request, FMCS furnishes a panel of qualified arbitrators from which the parties 

select a mutually satisfactory individual to hear and render a final and binding 

decision on the issue or issues in dispute. We retain a roster of over 1,300 private 

arbitrators, knowledgeable practitioners with backgrounds in collective bargaining 

and labor-management relations. FMCS charges a nominal fee for the provision of 

arbitrator lists and panels, or other major services. 

The FMCS computerized retrieval system produces a random panel of 

potential arbitrators from which the parties may select. However, panels can be 

compiled on the basis of geographic location, professional affiliation, occupation, 

experience with particular industries or issues, or other criteria when specified by the 

parties. FMCS also furnishes current biographical sketches of arbitrators for parties 

to establish their own permanent panels.

To join the FMCS Roster, arbitrators must be approved by an Arbitration 

Review Board, which meets quarterly to consider new applicants for appointment to the 

roster by the FMCS Director. There is also an arbitration user focus group, which 

reviews and makes recommendations to the FMCS Director on changes in Arbitration 

Service policies and procedures.

B. FY 2002 Accomplishments:

The following represents the activities and accomplishments of the Office of 

Arbitration Services during fiscal year 2002: 

• E-filing: To encourage on-line filing for arbitration panels, we have asked the 

Office of Management and Budget to increase fees for non-electronic panel 

requests, while maintaining the $30 on-line fee. 

• Timeliness of awards: Instituted a timeliness requirement in discharge cases. If 

an award in a discharge case is late, we no longer make that arbitrator available 

for additional work until the award is rendered. 

• Revisions to the R-43: We revised this form to expand acceptable forms of 

payment, and the ability to select an arbitrator based on a particular geographical 

region, subregion, or metropolitan areas. As a result of these targeted requests, 

we now provide the parties with the names of arbitrators whose principal business 
31

address is within 125 miles of the site of the dispute. This results in substantial 

savings on travel expenditures. 

• Expansion of arbitrator biographies: The arbitrators’ biographies now include 

more information regarding fees and expenses, awards rendered, significant 

publications, and their ability to work on an interest arbitration case or an 

expedited case. 

• Capture data on current issues: Revised the “issues” lists to conform with 

current issues facing the labor-management community. 

• Capture data on costs associated with arbitration: We reinforced our policy 

regarding the submission of R-19 form. This form captures the expenses 

associated with arbitrations and critical information regarding costs of arbitration 

as a whole. 

• FMCS Institute: Conducted two arbitrator training courses to increase the 

professionalism and expertise of new arbitrators. 

C. Arbitration Services Program Data

Number of Panel Requests, Panels Submitted and Arbitrator Appointments Fiscal Years 

1998 Through 2002

Activity 1998 1999 2000 2001 2002

Panel Requests 17,357 17,514 16,976 16,594 17,282

Panels Issued 27 31,295 19,062 19,485 18,275 18,891

Arbitrators Appointed 10,391 8,984 9,561 8,706 8,335

Activity Charged For 1998 1999 2000 2001 2002

Travel Days .34 .41 .51 .43 .45

Hearing Days 1.23 1.20 1.18 1.15 1.09

Study Days 2.30 2.38 2.58 2.40 2.44

Total 3.74 4.02 4.27 3.98 3.98

 

Charges 1998 1999 2000 2001 2002

Per Diem Rate 598.50 641.49 672.12 693.12 720.75

Amount of Fee 2,296.46 2,592.00 2863.49 2761.04 2884.46

Amount of Expenses 252.00 248.92 321.67 341.92 318.03

Total Charged 2,548.46 2,840.92 3185.16 3102.96 3202.49

 27 Frequently, the labor-management parties request more than one panel for arbitration cases, resulting in 

an increase in the number of panels issued over the number of requests received.
32

Total Number of Issues

And Specific Issues 1998 1999 2000 2001 2002

Total 2,132 2,132 2,723 1902 1989

General Issues 409 391 585 434 463

 Overtime Other Than Pay*

 Distribution of Overtime 36 30 48 34 26

 Compulsory Overtime 4 8 12 8 12

 Other Overtime 17 15 18 10 10

Seniority

 Promotion & Upgrading 49 42 86 54 52

 Layoff Bumping & Recall 52 48 65 46 48

 Transfer 22 13 16 17 21

 Other Seniority 31 33 38 25 25

 Union Officers** 6 4 12 9 14

 Strike & Lockout 2 2 4 3 2

 Working Conditions*** 15 19 35 35 29

 Discrimination 12 21 27 19 24

 Management Rights 37 49 75 51 63

 Scheduling of Work 49 45 50 43 67

 Work Assignments 77 62 99 80 70

Economic Wage Rates & Pay 

Issues

231 239 298 227 229

 Wage Issues 39 46 32 29 36

 Rate of Pay 48 65 75 53 60

 Severance Pay 7 6 5 6 8

 Reporting, Call- in & Call-back Pay 6 10 12 13 7

 Holidays & Holiday Pay 34 15 33 31 26

 Vacations & Vacation Pay 36 31 54 29 39

 Incentive Rates & Standards 12 17 25 13 7

 Overtime Pay 49 49 62 53 46

Fringe Benefits Issues 81 63 100 69 99

 Health & Welfare 35 27 58 29 58

 Pensions 15 6 14 11 8

 Other Fringe Issues 31 30 28 29 33

Discharge & Disciplinary Issues 1,032 1004 1203 849 947

 * Overtime pay issues included under this category Economic: Wage Rates and Pay Issues. ** Included in this classification are issues concerning super seniority and union business. *** This classification also includes issues concerning safety.
33

Technical Issues 79 102 139 81 86

 Job Posting & Bidding 38 36 52 32 38

 Job Evaluation 18 24 28 18 11

 Job Classification 23 42 59 31 37

Scope of Agreement 78 61 74 45 65

 Subcontracting 54 40 48 29 41

 Jurisdictional Disputes 15 10 16 8 14

 Foreman, Supervision, etc. 5 7 5 5 8

 Mergers, Consolidations, Accretion, 

Other Plants

4 4 5 3 2

Arbitrability of Grievances 81 146 193 109 100

 Procedural 43 98 120 76 60

 Substantive 29 35 42 14 23

 Procedural & Substantive 9 13 24 19 17

 Other Arbitrability Questions 0 0 7 0 0

Not Elsewhere Classified 43 126 131 88 115

Total Number of Cases

State & Region 1998 1999 2000 2001 2002

Mountain 97 142 85 123 115

 Arizona 8 9 15 10 15

 Colorado 30 47 28 40 30

 Idaho 4 6 3 7 5

 Montana 14 8 11 16 7

 Nevada 13 30 12 13 31

 New Mexico 18 35 11 26 19

 Utah 7 5 4 5 5

 Wyoming 3 2 1 6 3

Pacific 150 153 128 140 151

 Alaska 6 8 6 13 7

 California 56 86 59 66 73

 Hawaii 0 2 2 0 1

 Oregon 34 17 32 28 31

 Washington 54 40 29 33 39

Miscellaneous 7 9 16 9 13

 Philippines 0 0 0 0 0

 Puerto Rico 2 2 4 1 2

 Virgin Islands 1 4 4 4 10

 Guam 0 0 0 0 0
34

 Others43841

New England 34 20 29 45 17

 Connecticut45 10 130

 Maine 102222

 Massachusetts 119 11 129

 New Hampshire32021

 Rhode Island11063

 Vermont516 102

Middle Atlantic 567 233 289 307 246

 New Jersey 20 31 22 30 26

 New York 81 95 111 121 71

 Pennsylvania 233 107 156 156 149

South Atlantic 288 285 349 385 375

 Delaware546 123

 District of Columbia 20 53 31 36 35

 Florida 98 55 92 112 125

 Georgia 35 25 51 58 41

 Maryland 32 48 35 29 49

 North Carolina 177 21 29 29

 South Carolina 158 15 14 14

 Virginia 32 47 56 30 43

 West Virginia 34 38 42 65 36

East North Central 790 673 866 715 950

 Illinois 127 207 191 145 216

 Indiana 101 71 67 63 84

 Michigan 159 187 190 194 158

 Ohio 343 154 338 224 413

 Wisconsin 60 54 80 89 79

West North Central 408 222 316 314 273

 Iowa 88 49 61 68 51

 Kansas 3627 32 38 28

 Minnesota 103 40 90 84 82

 Missouri 148 85 101 94 89

 Nebraska 19 16 17 19 12

 North Dakota 101584

 South Dakota44 1037

East South Central 191 118 236 239 221

 Alabama 57 23 53 57 51

 Kentucky 49 35 70 81 66

 Mississippi 169 17 32 20
35

 Tennessee 69 51 96 69 84

West South Central 207 110 227 237 308

 Arkansas 30 11 35 40 53

 Louisiana 21 9 28 23 43

 Oklahoma 69 26 68 70 104

 Texas 87 64 96 104 108

Totals 2,506 1,965 2507 2514 2669

 

 
36

VI. GRANTS PROGRAM:

A. Grants: 

FMCS is authorized by the Labor-Management Cooperation Act of 1978 to 

award grants to support and encourage joint labor-management cooperative activities 

that “improve the labor-management relationship, job security and organizational 

effectiveness.” Congress funds FMCS Grants Program each year in the agency’s 

appropriation.

In fiscal year 2002, the FMCS awarded 13 new and 5 non-competitive 

(continuation of prior grants) at a cost of $1.5 million. These grants supported labormanagement committees representing approximately 1.6 million employees in both the 

private and public sector. In FY 2002, 67 grant applications were received. An 

independent FMCS Grants Review Board, chaired by the Director of LaborManagement Grants, does preliminary scoring of each application. Final selection is 

made by the program director.

B. Fiscal Year 2002 Grant Funding Summary

AREA

Lake Superior Area Labor Management Association, Inc. (Duluth, MN)

$32,327 to assist in outreach to the area east of the Duluth-Superior region and Iron 

Range and enable the grant to identify labor and management needs for cooperative 

initiatives.

PLANT

Virgin Islands Water & Power Authority (Christiansted, VI)

$48,000 to assist incorporating better communication systems through the development 

of video/dvd media and to enable the use of programs such as TAGS.

Newport News Shipbuilding (Newport News, VA)

$39,952 to propose a strategy on monitoring the progress of the return-to-work initiatives 

and identify “at-risk” injured workers who may need additional management, assistance, 

training or alternate medical treatment to successfully return employees to work.

INDUSTRY

Building & Construction Trades Department (Washington, DC)

$50,000 to assess skills that are lacking in the construction industry.

International Association of Machinists And Aerospace Workers (Upper Marlboro, 

MD) 

$100,000 to create a partnership that meets the challenges of decision-making in the 

global marketplace.
37

Mobilization Optimization Stabilization & Training (Kansas City, KS)

$149,850 to organize a national, ad-hoc committee to oversee the development, 

implementation and evaluation of a pilot program designed to create financial incentives 

to attract and retain Boilermakers.

Wisconsin Regional Training Partnership (Milwaukee, WI)

$125,000 to implement an education and leadership development program for 

contractors, unions and craft workers to improve union construction and cover market 

share.

Atlanta & North Georgia Building Trades (Atlanta, Georgia)

$100,000 to improve cooperation between labor and management to increase the quality 

and productivity of construction. 

Delaware Construction Council (Wilmington, DE)

$103,485 to improve communication and cooperation between management and labor

and to develop a structure to resolve jurisdictional disputes that occur on projects. 

Upper Midwest Labor Management Health Care Coalition (South St. Paul, MN)

$115,000 to expand innovation in labor-management collaboration in solving health care 

and related issues. 

Alliance of Construction Professionals (Toledo, OH)

$72,794 to revamp recruitment efforts through outreach to the Hispanic community to 

establish workplace diversity and offer economic development.

Pacific Coast Maritime Labor Management Consortium (Seattle, WA)

$123,386 to establish practical programs for career advancement within the maritime 

sector by developing an approach to outreach, recruitment and training to decrease the 

skills shortages in the industry.

PUBLIC SECTOR

State of Rhode Island (Providence, RI) 

$112,500 to assist in the development of a diversity plan in the state and strengthen

communications between labor and management. 

New Hampshire Federation of Teachers (Bow, NH)

$47,237 to create and implement an assessment system that improves student 

performance through effective teaching and professional development.

Clark County (Las Vegas, NV)

$64,123 to build an organizational structure and process to improve service outcomes and 

organizational effectiveness through implementation.
38

Superior Court of California (Oakland, CA)

$65,000 to establish a training program to improve the operational effectiveness of the 

Court and to facilitate career development of all employees.
39

VII. FMCS INSTITUTE:

A. Purpose and Course Offering:

Education and training in labor relations and conflict resolution are an integral 

part of the Agency’s mission for more than half a century. The Institute’s primary 

mission is to offer training and education to labor and management practitioners in a 

classroom format that is structured, accessible, and convenient to individuals and small 

groups rather than the site-based preventive mediation programs. The institute was 

established to respond to the changing needs of modern collective bargaining, providing 

essential training in meeting the challenges of labor-management relations and 

organizational change. 

In fiscal year 2002, the Institute offered the following classes: 

• Labor Arbitrator Skills Training 

• Advanced Facilitation Skills 

• Negotiating Contracts

• Mediation Skills for Workplace Violence 

• Information Technology and Conflict Resolution 

• Facilitating and Mediating Multi-Party Disputes 

Fees received for delivery of training services fund the 

FMCS INSTITUTE. All fees collected will be utilized 

to recover expenses and administrative costs of the 

Institute. Training fees charged to customers are set at a 

level that allows the Institute to provide a professionally delivered product 

from one year to the next. 
40

VIII. ADR/INTERNATIONAL: 

A. Services Provided: 

Alternative Dispute Resolution (ADR) services are available to agencies of 

government. These range from mediation, conflict resolution systems design, education, 

training and mentoring, to the facilitation of multi-party regulatory, environmental and 

public policy negotiations. All these services are successful alternatives to costly and 

time-consuming litigation in the settlement of conflict.

FMCS mediates disputes both within agencies (e.g., age discrimination and other 

unfair employment complaints, whistleblower complaints) and between agencies and their 

regulated public (e.g., environmental disputes). 

The longer-term objective is to assist agencies in institutionalizing these processes. 

FMCS “trains the trainers,” imparting these skills to agency personnel so they can 

construct their own dispute resolution system, and also train others within their 

organization. 

1. Domestic Alternative Dispute Resolution (ADR)

FMCS concluded nearly 1114 ADR cases for numerous governmental agencies in 

fiscal year 2002. For most of the governmental agencies listed below, we mediate 

workplace and discrimination disputes. Our government contracts include: 

• Equal Employment Opportunity Commission

• United States Postal Service

• Health and Human Services 

• Department of the Interior 

• Internal Revenue Service

• Department of Agriculture

• Department of the Navy 

• Immigration and Naturalization Service 

• U.S. Geological Survey 

• Federal Bureau of Investigation 

• Housing and Urban Development 

• Veteran Affairs 

• Peace Corps

Additional domestic ADR work included: 

City of Chicago Fire Department: Trained 25 mediators, jointly selected by 

management and labor, for training in communications, conflict resolution, problemsolving techniques, and the mediation process. Assisted in the creation of an “agreement 

to mediate” form and development of a mediation evaluation process. 

Iowa Department of Economic Development: Held multiple negotiation sessions with 

various stakeholders in the animal confinement industry. The state established stringent 

regulations on the location and operation of animal confinement facilities and the state 
41

law required that each county have local input for scoring applications for construction or 

expansion of these facilities. Participants in these negotiations included employer 

groups, state universities, the environmental community, state agencies, farmer 

organizations, and a representative from the county board of supervisors. TAGS 

technology was utilized in these negotiations and it enabled the parties to engage in 

organized brainstorming to comply with state regulations. 

2. Regulatory Negotiations:

Authorized by the Administrative Dispute Resolution Act of 1996, FMCS offers 

government regulatory and enforcement agencies a better way to formulate new rules and 

regulations. In the traditional rulemaking process, agency personnel draft new regulations 

with little or no outside input, publish the draft regulation in the Federal Register for the 

required public comment period, and then await criticism, or legal challenges, from those 

affected by the new regulation.

In contrast, FMCS convenes and facilitates Regulatory Negotiations, a process in 

which those affected by a regulation jointly draft a proposed rule or regulation by 

consensus. Early involvement by potential antagonists allows the agency to resolve its 

problems by working together with the agency’s stakeholders. The result is better 

regulation because those facing regulation took an active role in the process. In addition, 

subsequent court challenges are greatly reduced.

Our most significant achievement in FY 2002 in this area was our involvement in 

a public meeting held by the National Institute of Standards and Technology, Department 

of Commerce. The agency gathered comments and suggestions related to the building 

and fire safety investigation of the World Trade Center collapse on September 11, 2001. 

A team of mediators played a key role in planning this very public meeting, involving 

200 attendees commenting on issues that remain crucial to the safety of the nation’s 

structures. 

3. International Dispute Resolution, Education and Training:

FMCS is responding to increasing requests for conflict resolution services outside

the traditional domestic labor-management. It is adapting the same skills and processes 

provided here to friendly foreign governments and organizations. Briefing sessions for 

foreign union and management officials familiarize them with U.S. labor-management 

history, laws, and practice enabling them to more fully understand how American 

industry and its workers function in today’s economy.

The International ADR Team develops a program plan, outlining specific services, 

potential venues for those services and possible funding sources. Since FMCS receives no 

appropriated funds for its ADR or International programs, mediator salaries and expenses 

are reimbursed through such entities as the Department of State, The United States 

Agency for International Development (USAID) and the United States Institute of Peace.

Overall, we assisted 73 foreign government organizations in FY 2002. Some 

examples include the following: 

 
42

• Asia-Pacific Economic Cooperation (APEC): Provided training to 7 APEC 

member economies in prevention and resolution of labor and employment

disputes and assisted the participants in preparing action plans for adapting their 

economies to conflict resolution processes.

• Argentina: Provided training in labor techniques and win-win negotiations to 

address the backlog of discharge cases pending in parts of the country. Training 

also provided on how to deal with difficult issues raised in negotiations. 

• Australia: Training to the Royal Austrian Navy on cultural competency and 

alternative dispute resolution.

• Bulgaria: Two week training course on a developing a commission for 

mediation and arbitration. 

• China: Provided institutional consulting regarding labor issues arising from 

privatization efforts. 

• Puerto Rico: FMCS mediators, in a program sponsored by the United States 

Department of Labor, mediated a backlog of pending wage and hour cases. 

• Mozambique: In a program sponsored by the United States Department of 

Labor, we conducted a five phase program designed to educate the Mozambique

Ministry of Labor on labor-management relations and conflict resolution. 

• Croatia: In a project funded by USAID, training was provided in 

communication skills and dispute resolution for 60 labor, management and 

government officials. 

• East Africa: Under ILO auspices, training was provided to 60 labor officials 

from Kenya, Uganda and Tanzania in negotiation skills and mediation.

• Indonesia–ILO/US Declaration Project: Provided training to 40 high-level 

government officials, mediators, trade union and employer representatives to 

build a mediation model similar to that in the United States. Training also 

provided in alternative dispute resolution techniques and interest based problem 

solving. 

• Latvia, Lithuania and Estonia: Funded by the United States Department of 

State, this project trained labor relations teams in women’s labor issues, 

collective bargaining, dispute resolution and workplace improvements. The 

program also allowed for foreign officials to “shadow” FMCS mediators while 

they performed their work. 
43

IX. FMCS ORGANIZATION: 

The functions and responsibilities of each office within FMCS are set forth below:

Office of the Director

The Director, appointed by the President with the advice and consent of the Senate, is 

responsible for establishment of policy and overall administration of the Service. The 

Director serves as agency liaison with the White House, members of the President’s 

Cabinet, Congress, and major labor and management customers, while providing 

direction for, and participating in, the mediation of major disputes and preventive 

mediation cases.

The Executive Assistant to the Director assists the Director in the administration of 

his duties, has overall responsibility for the coordination of meetings and events 

involving the Director and represents the Director in many National Office activities, 

such as the National Office Partnership Council.

Chief of Staff 

The Chief of Staff serves as the principal operations officer in the internal 

administration of the Service, responsible for managing the daily operations and 

implementing policies for the program and support functions of the National Office. The

Chief of Staff also serves as an advisor to the Director in establishment of policy, and 

represents the Director in a variety of forums with the White House, the President’s 

Cabinet, Congress, leaders of labor and management, and federal, state and local 

government officials. 

National Office Departments

The Office of Arbitration Services provides the labor-management community, 

upon request, with “panels” of highly qualified arbitrators to settle disputes arising during 

the life of labor contracts. This office maintains a computerized roster more than 1,350 

qualified, private sector arbitrators. 

The Office of Budget and Finance develops budget estimates and supporting 

material to cover the financial needs of the Service, coordinates and assists in the 

presentation of the budget to the Office of Management and Budget and to the Congress, 

and ensures that enacted appropriations are properly executed. The office also provides an 

integrated system of accounting controls, records, and reports to meet management’s needs 

and ensure compliance with applicable laws.

The Office of Education and Training develops educational and training curricula 

for FMCS Preventive Mediation programs, and oversees all training and professional 

development functions for FMCS leadership, mediators and staff, including the assessment 

of staff training needs and the coordination of training programs.
44

The Office of Human Resources is responsible for providing human resource 

programs to meet management’s needs and ensure compliance with applicable laws and 

regulations. Major programs include hiring of qualified employees, classification of all 

positions, implementation and monitoring of appraisal systems, and coordination of 

employee relations programs.

The Office of Information Systems and Administration provides a full range of 

administrative support functions to the National Office in Washington, D.C. and the 

seventy one field locations throughout the country. These services include procurement, 

contracting, supply, office space, mail services, records management, printing and 

distribution, desktop publishing, communications and transportation management, building 

security, and maintenance. This office is also responsible for the Service’s automated data 

processing support with the major focus on systems that handle case processing and 

reporting.

The Office of International and Alternate Dispute Resolution Services is 

responsible for International Domestic Alternative Dispute Resolution, International Labor 

and International Dispute Resolution activities and projects, coordinating the provision of 

conflict resolution services with other government agencies, including joint problemsolving approaches used in lieu of agency adjudication, courtroom litigation and traditional 

government rulemaking. This office also coordinates programs with sponsoring 

organizations that send FMCS mediators abroad and bring delegations from other countries 

to FMCS Headquarters. 

The Office of Programs and Labor-Management Grants administers the FMCS 

program for labor-management grants, supporting the establishment and operation of plant, 

area, and industry wide joint labor-management committees, and coordinating the National 

Labor-Management Conference. 

The Office of the General Counsel provides legal support and advice necessary 

for the Service to carry out its mission. Working with the Department of Justice, the 

office represents the agency in proceedings before the Merit Systems Protection Board, 

the Office of the Special Counsel, the Equal Employment Opportunity Commission, the 

Federal Labor Relations Authority, and other administrative bodies. This office is also 

responsible for the agency’s compliance with the Freedom of Information Act.

The Designated	Agency	Ethics	Officer	is	responsible	for	assuring	high	ethical	

standards	by	all	FMCS	employees,	and	for	preventing	any	financial	conflicts	of	

interest,	or	the	appearance	of	conflict	by	FMCS	personnel.		This	office	manages	the	

agency’s	Ethics	program,	which	includes	annual	ethics	training	for	all	employees,	and	

oversight	of	all	required	financial	reporting	by	certain	FMCS	personnel.		

FMCS Field Organization

Leadership Teams in each of the Service’s five geographic regions are comprised of 

a Regional Director and two Directors of Mediation Services, who report to the Regional 

Director and each work hands-on with approximately twenty mediators. 
45

Mediators are the largest group of employees. They provide services to the 

agency’s customers, mediating disputes in the negotiation of collective bargaining 

contracts, and training in cooperative skills and processes as part of Preventive Mediation 

services. To be selected as mediators, they must have extensive experience and 

knowledge of collective bargaining and a strong commitment to become proficient in the 

delivery of all FMCS services. Their knowledge of labor-management relations and the 

collective bargaining process is key to their ability to assist and influence bargainers in 

settling their differences. 
46

X. LEGISLATIVE AUTHORITY:

The Federal Mediation and Conciliation Service was established by Title II of 

the Labor-Management Relations Act (Taft-Hartley) in 1947 as an independent agency 

whose mission is to prevent and minimize labor-management disputes affecting 

interstate commerce by providing mediation, conciliation, and voluntary arbitration. 

That primary duty remains unchanged. All mediation and conciliation functions of the 

Secretary of Labor and the United States Conciliation Service were transferred to 

FMCS at that time. Its independence and neutrality were highlighted by the Act’s 

legislative command that “The Director and the Service shall not be subject in any way 

to the jurisdiction or authority of the Secretary of Labor or any official or division of 

the Department of Labor.” The FMCS mission includes both the private and public 

sectors, except for the railroad and airline industries, which are covered by the Railway 

Labor Act and the National Mediation Board.

In 1990, the Administrative Dispute Resolution Act and the Negotiated 

Rulemaking Act authorized the agency to assist other Federal agencies in resolving 

disputes arising out of grants, contracts, licenses, or other agency rules, regulations or 

administrative actions, and to assist in the process of negotiated rulemaking. The 

Administrative Dispute Resolution Act of 1996 amended and permanently reenacted 

these 1990 Acts.

The National Performance Review recommended creation of the National 

Partnership Council to promote the formation of labor-management partnerships in the 

Federal government as a way of reforming government. FMCS has continued its 

mediation and other services available to federal sector parties in an effort to avoid costly 

litigation and adversarial disputes.

Over the years, Congress and the Executive Branch have authorized FMCS to 

perform a variety of dispute resolution functions as well as to assist in collective 

bargaining disputes and the improvement of labor-management relationships. Specific 

statutory and other authorizations of agency programs are described below. 


47

The Labor-Management Relations Act of 1947 (Public Law 80-101, 29 U.S.C. See. 

173) directs the Service to prevent or minimize interruptions of the free flow of 

commerce growing out of labor disputes by helping the parties settle such disputes 

through mediation. Parties are required to notify the Service 30 days prior to a contract 

termination or modification date so that mediation services may be proffered.

The Act establishes a special procedure for threatened or actual strikes which in the 

opinion of the President imperil the national health or safety. In such a situation, the 

President may appoint a board of inquiry to ascertain the facts with respect to the 

dispute. After receipt of the report, the President may seek to enjoin the strike for not 

more than 80 days, and a court may do so if it finds that the threatened or actual strike 

or lockout affects a substantial part or all of an industry and would imperil the national 

health or safety.

The Health Care Amendments of 1974 (Public Law 93-360, 29 U.S.C. See. 158(d) 

(amending the National Labor Relations Act) include special responsibilities to prevent 

or minimize work stoppages in the health care industry. In the case of this industry, 

FMCS must be notified 60 days before the contract termination date. A 30 day notice 

is required in initial bargaining situations. If, in the opinion of the Director, a strike is 

threatened which would interrupt the delivery of health care in a locality, the Director 

may appoint a board of inquiry (29 U.S.C. section 183). The board has 15 days within 

which to operate and file its report and recommendations; parties must maintain the 

status quo for 15 days thereafter while further negotiations and mediation take place. 

The parties are required to cooperate in any mediation efforts by FMCS.

The Civil Service Reform Act of 1978 (Public Law 95-454, 5 U.S.C. Sec. 7119) 

directs the Service to provide mediation assistance and services in disputes arising 

from negotiations between Federal agencies and the exclusive representatives of their 

employees.

The Postal Reorganization Act of 1970 (Public Law 91-375,39 U.S.C. Sec. 1207) 

requires the Service to establish fact-finding panels and arbitration

boards if disputes between the Postal Service and the exclusive representatives of its 

employees are not resolved prior to certain statutory deadlines.

Presidential Statement, March 24,1953. President Eisenhower established the 

Atomic Energy Labor-Management Relations Panel within the Service in March 1953, 

in order to ensure the uninterrupted functioning of the Atomic Energy Program without 

strikes or lockouts due to labor-management disputes. This Panel was moved to the 

Atomic Energy Commission in March 1956 but was returned to FMCS under 

President Carter in April 1980 and renamed the Energy Labor-Management Relations 

Panel (ELMRP).

Executive Order 11374, dated October 11, 1967, transferred the responsibilities of 

the Missile Sites Labor Commission (created by Executive Order 10946) to FMCS.

The Federal Insecticide, Fungicide and Rodenticide Act of 1978 (Public Law 

95-396, 7 U.S.C. 136a(c)(f)(ii)) requires the Service to provide for the appointment of 
48

arbitrators to decide disputes concerning compensation for the use or development of 

pesticide registration data.

The Labor-Management Cooperation Act of 1978 (Public Law 95-524, 29 U.S.C. 

175a) amended sections 175 and 302 of the Labor-Management Relations Act and 

authorizes and directs the Service to encourage and support joint labor-management 

activities conducted by plant, area, and industry-wide committees designed to improve 

labor-management relationships, employment security, and organizational 

effectiveness. The Act authorizes the Service to provide grant funds to assist in the 

establishment and operation of these labor-management committees.

The Administrative Dispute Resolution Act of 1996 (Public Law 104-320) 5 

U.S.C., 571, et seq. authorizes and encourages agencies to use various alternative 

means of dispute resolution in the federal administrative process in order to avoid the 

time and expense of litigation. The 1996 Act amended and permanently reenacted the 

Administrative Dispute Resolution Act of 1990 as well as the Negotiated Rulemaking 

Act of 1990. The repeal of the sunset date (expiration dates) and the reporting 

requirements of the Acts suggest that the ADR and regulatory-negotiation 

"experiments" have become well accepted processes of Federal agencies.

A lead agency or interagency committee will be designated by the President to 

facilitate and encourage use of alternative dispute resolution. Federal agencies are now 

required to consult with that lead agency or committee and are now permitted to 

participate in binding arbitration in some situations. Under the 1996 Act, coverage has 

been expanded to include additional dispute resolution techniques, such as 

"ombudsmen," and the use of ADR in some workplace conflicts, including Hatch Act 

violations, retirement, insurance, certain suspensions, removals, examinations and 

appointments. The 1996 Act directs FMCS to develop guidelines to expedite the 

acquisition of neutrals and to encourage use of alternative dispute resolution in the 

Federal government. Lastly, this legislation amends the Labor-Management Relations 

Act of 1947 (Taft-Hartley) by permanently adding section 173(f) of Title 29 of the 

United States Code so that FMCS may provide all forms of ADR assistance to Federal 

agencies. Under this legislation, FMCS continues to assist agencies in negotiated 

rulemaking processes as well as other ADR procedures by providing training, 

facilitation, mediation, and other neutral skills.

The U.S. Code of Federal Regulations at 45 CFR 90.43, issued by the Department 

of Health and Human Services, implementing its authority under the Age 

Discrimination Act of 1975, 42 U.S.C. 6 101 et seq., authorizes the Service to 

provide mediation assistance for the resolution of age discrimination charges.

The Air Traffic Management Performance Improvement Act of 1996 (Public Law 

104-264, 49 U.S.C. Section 40122, directs the FMCS to mediate disputes between the 

Administrator of the Federal Aviation Administration and its employee representatives 

if these bargaining parties fail to reach a negotiated agreement. 
49