The MSPB recently reaffirmed its power to review arbitration decisions involving claims of discrimination where the Board has jurisdiction over the subject matter, such as an adverse action, and even to set such decisions aside if it determines that they were based on incorrect legal analysis.

In Pace v. Dept. of the Treasury, 2012 MSPB 108 (9/19/12), Pace requested that the MSPB review the decision of an arbitrator who had heard his challenge to his removal on allegations of misconduct. The arbitrator determined that removing Pace did not promote the efficiency of the service, and ordered that he be reinstated with four months back pay (although he had been out of work for 26 months).

Pace argued that the arbitrator’s decision was flawed in that it failed to appropriately consider and decide on several arguments he had presented. The neglected arguments included claims that the agency had subjected Pace to discrimination, harassment and retaliation and had violated his due process rights. Pace asked the Board to consider the claims the arbitrator had overlooked, make a finding of discrimination, and award him not only full back pay for the entire period since his termination, but also compensatory damages for pain and suffering caused by the agency’s discrimination and retaliation.

In its decision on Pace’s request for review, the Board described what it could and could not do in situations such as this. The Board stated, for example, that it could not consider the agency’s arguments that there were important errors in the arbitrator’s decision since agencies do not have an independent right to Board review of arbitration awards. The Board also clarified that it has authority to review arbitration decisions only to the extent that they are based on errors of law, or do not provide adequate legal justification. The arbitrator’s findings of fact, however, are entitled to the Board’s deference.

In this case, the Board found that the arbitrator had not provided a sufficient explanation of the legal standards or framework he used to arrive at his decision. The Board noted, for example, that by awarding Pace only four months of back pay when he had been out of work for 26 months, the arbitrator effectively imposed a 22-month suspension on Pace, without providing any justification for doing so.

As for Pace’s claims of discrimination, the Board stated that it had authority to review such claims even if they had not been raised during the arbitration, but that it could not review other claims not previously raised. In Pace’s case, the Board found that he should have a full opportunity to make his arguments before an administrative judge who would then issue a decision on his claims of discrimination and retaliation since the arbitrator’s decision failed to do so. The Board set aside the arbitrator’s decision and determined that Pace’s case should be sent to his regional MSPB office for further processing and decisions on his claims.

* This information is provided by the attorneys at Passman & Kaplan, P.C., a law firm dedicated to the representation of federal employees worldwide. For more information on Passman & Kaplan, P.C., go to http://www.passmanandkaplan.com.

The attorneys at Passman & Kaplan, P.C, are the authors of The Federal Employees Legal Survival Guide, Second Edition, a comprehensive overview of federal employees’ legal rights. To order your copy, go to http://www.passmanandkaplan.com/CM/Custom/Federal-Employees-Survival-Guide.asp. This book originally sold for $49.95 plus s&h, but is now available