Opinion ID: 568491
Heading Depth: 1
Heading Rank: 3

Heading: eligibility for attorneys' fees

Text: 16 As we revert to the cases at bar, we are confronted at the threshold by the question whether, in the circumstances presented, there properly can be any attorneys' fee award at all. The Back Pay Act, in referring to the recipient of the entitlements it confers, uses the word employee, 38 which is statutorily defined in terms of an officer or an individual. 39 Since the requests for fees were submitted not by Richard Frontera, the fired and later reinstated cook, but rather by the union attorneys who participated in the grievance and unfair labor practice proceedings on his behalf, our dissenting colleague concludes that no allowance of fees is authorized. And the Bureau, adverting to Section 7701(g)(1)'s requirement that attorneys' fees sought must have been incurred by an employee, 40 maintains that since Frontera was not legally obligated to pay any sort of fee none was incurred, and that since Frontera was not a named party to either the arbitration or the ensuing proceedings he was not represented therein.
17 We begin our consideration of these contentions with a close look at the two statutory provisions most pertinent. The union invokes the Back Pay Act which, in speaking of who may obtain attorneys' fees under its aegis, states that it is [a]n employee of an agency who, on the basis of a timely appeal or an administrative determination (including a decision relating to an unfair labor practice or a grievance) is found by appropriate authority under applicable law, rule, regulation, or collective bargaining agreement, to have been affected by an unjustified or unwarranted personnel action which has resulted in the withdrawal or reduction of all or part of the pay, allowances, or differentials of the employee. 41 The entitlement of this employee arises on correction of the personnel action, 42 and it is to receive backpay for the period for which the personnel action was in effect 43 and reasonable attorney fees related to the personnel action. 44 However, with respect to any decision related to an unfair labor practice 45 or a grievance processed under a procedure negotiated in accordance with applicable provisions of the Civil Service Reform Act, 46 the fees must be awarded in accordance with standards established under section 7701(g). 47 18 Section 7701(g) 48 is directed primarily to grants of attorneys' fees by the [Merit Systems Protection] Board, or an administrative law judge or other employee of the Board designated to hear a case on appeal from a personnel action. 49 Either may require payment by the agency involved of reasonable attorney fees incurred by an employee or applicant for employment 50 upon satisfaction of two conditions. One is that the employee or applicant is the prevailing party; 51 the other is that there be a determin[ation] that payment by the agency is warranted in the interest of justice. 52 The phrase interest of justice includ[es] any case in which a prohibited personnel practice was engaged in by the agency [and] any case in which the agency's action was clearly without merit. 53 19

20 To say, as the dissent does, that labor unions and their lawyers who assist employee personnel litigation are beyond the pale of the Back Pay Act's attorneys' fee prescription is first to defy the strong current of contemporary interpretation. The Supreme Court has twice confirmed the entitlement of nonprofit legal service organizations to fees under the Civil Rights Attorney's Fees Awards Act of 1976 54 though it speaks only of fees for the prevailing party. 55 In this circuit, under statutes worded no more definitively or comprehensively, we have done the same with respect not only to a similar entity 56 but also to labor unions. 57 The Ninth Circuit has ruled explicitly that market-rate fees sought for a union's legal services fund are allowable under the Back Pay Act. 58 Both the Claims Court 59 and MSPB 60 have bottomed cost-based fees for union lawyers on that legislation, and FLRA has rested awards of both types thereon. 61 The Federal Circuit 62 and MSPB 63 held that unions may stand on Section 7701(g)(1)'s conditional authorization of awards of reasonable attorney fees incurred by an employee or applicant for employment 64 in their quests for remuneration incidental to representation of those individuals by union counsel. 21 Precedent, then, both judicial and administrative, points singularly in the direction of the availability of fees under the Back Pay Act to a labor union whose attorney has served the cause of an aggrieved employee in a grievance or unfair labor practice matter. We have not been referred to, nor have we found, any authority supporting the position taken in dissent; indeed, we have not encountered any other case in which the objection interposed by the dissent was even urged. We realize, of course, that some decisions favoring unions and union counsel have limited them to cost-based fees, a consideration we later address. 65 The important point for present purposes, however, is that they recognize that unions and their lawyers qualify for fees in some amount when the statutory elements stated are present. 22 There is abundant reason for this well-nigh universal understanding of the Back Pay Act. Whether or not a union may solicit attorneys' fees as a matter of independent entitlement, the victorious employee surely can, 66 and the representative character of the union and its lawyers in the litigation for which fees are sought must be taken fully into account. In the cases before us it cannot be doubted that they acted in that capacity throughout the grievance and unfair labor practice proceedings, a fact noted in the decision under review: 23 As the [administrative law] Judge found, the Union and its counsel filed the charge in this case and were at all relevant times prosecuting the case primarily, if not solely, on behalf of employee Frontera. Frontera was the sole person who suffered whatever harm was occasioned by the Agency's commission of an unfair labor practice. The remedy sought, and eventually obtained, through the administrative and judicial process was personal to Frontera. 67 24 We see no reason why the union and union counsel could not continue equally with other counsel in their representative roles when it became appropriate to request attorneys' fees, and the Act has been administratively interpreted to permit precisely that to be done. Congress wrote into the Back Pay Act a direction to OPM to prescribe regulations to carry out this section 68 and OPM has issued a regulation allowing [a]n employee or an employee's personal representative [to] request payment of reasonable attorney fees under the act. 69 As OPM has explained, [t]his provision does not address the question of who may receive payment for reasonable attorney fees. Rather, it provides that an employee's personal representative may request payment of reasonable attorney fees on the employee's behalf. 70 We believe the phrase employee's personal representative encompasses a union and its salaried attorney who have represented the employee. 71 Once requested and granted,, the fees can be allocated among the union, union counsel and the employee as their respective interests may appear--the process utilized in many contexts all of the time. 25 OPM's regulation is significant as an authoritative interpretation of the Back Pay Act. Congress has not specified any procedure to be followed in asking for fees, even when the employee is the applicant. As the Supreme Court has taught,  '[t]he power of an administrative agency to administer a congressionally created ... program necessarily requires the formulation of policy and the making of rules to fill any gap left, implicitly or explicitly, by Congress.'  72 And when, as here, the legislative delegation to an agency on a particular question is implicit rather than explicit[,] ... a court may not substitute its own construction of a statutory provision for a reasonable interpretation made by the administrator of an agency. 73 26 This body of judicial and administrative precedent and the logic supporting it weighs heavily on the side of the union. The dissent, on its part, offers no more than a literal reading of the statutory language. The Supreme Court has repeatedly warned against the dangers of an approach to statutory construction which confines itself to the bare words of a statute, ... for 'literalness may strangle meaning.'  74 That, we think, the dissent has let be done here. 27
28 When we examine the structure of the Back Pay Act's fee section and its legislative history, it becomes even more evident that Congress did not intend to banish unions or their salaried lawyers from the realm of reasonable remuneration. 29 One of the major accomplishments of the Civil Service Reform Act was statutory protection of the right of employees to organize, bargain collectively, and participate through labor organizations of their own choosing in decisions which affect them. 75 Labor organizations ... in the civil service, Congress declared, are in the public interest, 76 and the Act allots various functions to them. 77 Of special interest to us are those defining the role of unions in grievances and unfair labor practice actions. 30 Agencies must accord exclusive recognition to unions selected by unit employees as their representatives. 78 The union chosen becomes the exclusive representative of the employees in the unit it represents and is entitled to act for, and negotiate collective bargaining agreements covering, all employees in the unit. 79 With exceptions not applicable here, collective bargaining agreements must provide procedures for the settlement of grievances, including questions of arbitrability, 80 which are the exclusive procedures for resolving grievances which fall within [their] coverage. 81 All grievance procedures thus negotiated must 31 include procedures that-- 32 (A) assure an exclusive representative the right, in its own behalf or on behalf of any employee in the unit represented by the exclusive representative, to present and process grievances; 33 (B) assure such an employee the right to present a grievance on the employee's own behalf, and assure the exclusive representative the right to be present during the grievance proceeding; and 34 (C) provide that any grievance not satisfactorily settled under the negotiated grievance procedure shall be subject to binding arbitration which may be invoked by either the exclusive representative or the agency. 82 35 The interplay of these provisions is well illustrated by the events transpiring in the cases at bar. The union, as exclusive representative of the employees in Frontera's bargaining unit, worked out with the Bureau of Prisons a collective bargaining agreement specifying procedures for processing and resolving grievances. The union later represented Frontera in his individual grievance proceeding, assigning two of its staff attorneys to the effort. When the parties deadlocked, the union called for arbitration and won an order favorable to Frontera. Thereafter, when the Bureau refused to obey the arbitral order, the union prosecuted an unfair labor practice action to a successful conclusion. Union counsel then sought compensation for the services they rendered in Frontera's behalf and invoked the Back Pay Act as the statutory foundation for an allowance thereof. Our dissenting colleague says that they must be rebuffed because the Act authorizes an attorneys' fee award only to an employee, which the union and its lawyers definitely were not. 36 We would be greatly surprised to learn that they must be turned down if that were to become the case. Attorneys' fees are for the asking when employees are permissibly represented by privately-retained counsel and the statutory prerequisites are satisfied. 83 It is inconceivable that Congress, after imposing vital representational duties on unions, meant to deny fee awards when union lawyers served employees in like fashion. We need not, however, rest our decision upon this consideration alone, for specific features of the Act demonstrate beyond cavil that Congress did not intend that result. 37 An employee subjected to disciplinary action 84 may elect either to appeal to MSPB 85 or to utilize an available negotiated grievance procedure. 86 If the employee picks the latter, the union has the right to present and process the grievance on behalf of the employee 87 and, if the grievance is not satisfactorily settled by negotiation, the union or the agency may require submission of the dispute to binding arbitration. 88 While it is the employee's decision whether to use the negotiated grievance procedure at all, 89 the Supreme Court reminds us that [t]he union and the agency possess the exclusive power to invoke the arbitral process.... 90 So it was in the instant case that the union was formally a party to the arbitration and Frontera, the real party in interest, was not. 38 When we examine the dissent's position against this statutory backdrop, we find it totally at war with the Back Pay Act. As we have seen, the Act expressly authorizes attorneys' fee awards for services furnished in grievance or unfair labor practice proceedings on behalf of employees adversely affected by unjustified or unwarranted personnel actions. 91 This was the upshot of congressional dissatisfaction with the 1966 version of the Act, which had left the expense of legal representation wholly upon employees, even when they were successful in their efforts. 92 Grievances usually wind up in arbitration, which unions must invoke and service; 93 many are resolved in unfair labor practice actions, which ordinarily are handled by union lawyers; 94 and employees cannot be represented by outside counsel when, as here, negotiated grievance and unfair labor practice procedures are utilized. 95 So, while the Act supplies the promise and the means of compensating union counsel, the dissent would snatch this opportunity away on the theory that union counsel cannot benefit from the Act. 39 After imposing upon unions and their lawyers the responsibility of employee representation in areas vital in the scheme of the Civil Service Reform Act, it would have been the height of irony for Congress to deny them the blessing of the Back Pay Act. We are unwilling to attribute such a purpose to Congress. Moreover, it is a cardinal rule of statutory construction that, to the extent possible, a legislative enactment is to be so read as to give operation to all of its parts, 96 and we are not prepared to disregard this salutary canon of interpretation.
40 The Bureau's primary arguments are that unions and union lawyers cannot qualify under the Back Pay Act for an award of attorneys' fees for services rendered on behalf of an employee in a proceeding to which the employee was not a named party. The Bureau also insists that fees must be disallowed in this case for failure to meet one of the statutory stipulations. We find no merit in these contentions. 41 Nothing in the Back Pay Act requires an affected employee to be named as a party to an administrative proceeding charging wrongful personnel action, and for fairly obvious reasons. As we have said, resolution of employee grievances is accomplished largely through binding arbitration, which only the union and the agency can invoke. 97 A requirement of party status would likely produce less frequent resort to this time-tested mechanism for dispute resolution as well as unfairness to many lawyers who deserve to be paid. We agree with FLRA that 42 [t]o read the Back Pay Act to require an employee to file unfair labor practice charges in addition to, or as opposed to, the Union filing such charges as the representative of that employee would emphasize form over substance and render the Back Pay Act's provisions inapplicable in a large number of cases. We do not believe that such an interpretation is necessary or appropriate. 98 43 The Bureau also points to the specification in the Back Pay Act that attorneys' fees are to be awarded, if at all, in accordance with the standards established under section 7701(g), 99 which empowers MSPB to allow reasonable attorney fees incurred by an employee in proceedings before it. 100 The Bureau contends that incurrence by the employee of a liability for fees is a requirement for an award under the Back Pay Act, and that it was not met because the union's lawyers represented Frontera free of charge. If the Bureau were correct, the astonishing result would be that Back Pay Act awards could be made only when employees could afford to pay for legal talent, which many employees are unable to do and no prevailing employee should have to do. 101 It was for those very reasons that the attorneys' fees provision was put into the Back Pay Act, 102 which is devoid of any reference to incurrence. This court has said, with reference to a similar statutory scheme, that free representation by union staff counsel does not preclude an award of attorneys' fees; 103 MSPB has held under Section 7701(g) that the fact that an employee had no contractual obligation to pay for legal services does not render inappropriate an attorneys' fee award to union-paid counsel; 104 and MSPB has further ruled that attorney fees are 'incurred' within the ambit of § 7701(g)(1) where an attorney-client relationship exists and counsel has rendered legal services on behalf of the employee. 105 Clearly, that relationship existed between Frontera and the two attorneys who labored on his behalf. 106 44 More importantly, the requirement that Back Pay Act awards of attorneys' fees abide the standards established under section 7701(g) hardly imports into the Act every prerequisite to attorneys' fee allowances by MSPB. 107 OPM, in its special interpretive role, 108 has refused to declare that this language refers to Section 7701(g)(1)'s demand for incurr[ence] by the employee 109 and has instead adopted MSPB's stance on that score. 110 In the instant cases, FLRA remained faithful to that construction 111 and after careful review believe[d] that this case presents the type of situation to which the authorization of attorney fee awards in MSPB and related proceedings is intended to apply. 112 It elucidated: 45 The sole issue in the unfair labor practice proceeding was the Agency's failure to comply with an arbitration award. The award specifically set forth the Arbitrator's ruling that Frontera was to be reinstated to a position in Ray Brook, New York, and that his assignment to Lewisburg, Pennsylvania did not constitute compliance with that award. Nonetheless, the Agency continued to refuse to properly reinstate Frontera throughout the course of substantial litigation, including the unfair labor practice proceeding and an unsuccessful appeal to the court of appeals. The employee's position was vindicated at each step of these proceedings. 113 46 We agree. An agency bears a statutory duty to comply with an arbitrator's final award, 114 and surely that obligation extends to adverse-action arbitration awards. The interest of justice is served by an allowance of attorneys' fees whenever the agency's action [is] clearly without merit, 115 and without a doubt so it was here.