SEC Once Again Refuses to Provide Retroactive Transit Subsidies Passed by Congress; Union Files Latest National Grievance


1/28/15:  Last week, NTEU Chapter 293 filed a national grievance against the SEC over its latest violation of the collective bargaining agreement with the union and refusal to provide a benefit to which SEC employees are entitled. Specifically, the SEC's Office of Human Resources (OHR) has refused to implement recently enacted retroactive transit benefits and has refused to bargain over the issue. In related news, the Federal Labor Relations Authority (FLRA) yesterday upheld a federal arbitrator's decision that another federal agency violated its collective bargaining agreement with NTEU by failing to pay similar retroactive transit benefits in 2013.

Late last year, Congress passed the Tax Increase Protection Act of 2014 (TIPA), which amended the law governing qualified transportation fringe benefits. TIPA increased the maximum tax-free monthly transportation subsidy that may be provided from $130 per month to $250 per month. It also provided that this increased subsidy shall apply retroactively to January 2014.

Under Article 23 of the Collective Bargaining Agreement between the union and the SEC, when transit benefits are increased, the SEC is required to provide the new maximum amount or else reopen the matter for further negotiations. After the passage of TIPA, union leaders contacted OHR at the SEC and requested that it pay the new maximum, including the retroactive benefit afforded under the new law. OHR agreed to increase the current subsidy going forward, but refused to pay the retroactive benefit.

This latest grievance is very similar to a grievance filed by the union against the SEC in 2013, when OHR refused to pay retroactive transit benefits after Congress passed the American Taxpayer Relief Act of 2012 (ATRA), which also provided for retroactive transit subsidies back to January 2012. The union settled that case by waiving the claim for retroactive benefits under ATRA in exchange for a permanent increase of the transit subsidy going forward from $130 per month to $250 per month.

OHR is now claiming that because the union settled the 2013 grievance under 2012's ATRA, it is not obligated to do anything retroactively under 2014's TIPA. This nonsensical position is undercut not only by the language in our collective bargaing agreement, but also by the fact that OHR has already retroactively repaid the taxes that it withheld on the increased transit subsidies that it paid to SEC employees during the final months of 2014. (The portion of the subsidy that was over the nontaxable first $130 paid per month was subject to taxes). If the taxes withheld were repaid retroactively, then why is OHR refusing to pay the increased subsidy retroactively?

Adding a further wrinkle to the issue, the FLRA yesterday issued a decision against the Department of Health and Human Services (HHS) for its failure to pay retroactive transit benefits under ATRA back in 2013. In that case, federal arbitrator Suzanne R. Butler previously ruled that HHS had violated its collective bargaining agreement with NTEU when it refused to pay the retroactive benefits in 2013, and directed the agency to reimburse affected employees for the amounts that they would have received absent the contract violation. The FLRA upheld Butler's decision. NTEU Chapter 293 at the SEC has similar contract language in its collective bargaining agreement.

"We hope that SEC senior management will reverse this latest misguided decision," NTEU Chapter 293 President Greg Gilman remarked this morning. "What is most disappointing about this is that, once again, we have a situation where OHR appears to be doing its level best to withhold a benefit when it is not required to do so," he added. "Congress has enacted a law and the FLRA has issued a decision interpreting an identical law under the same contract provision in favor of the employees of another federal agency. Other financial regulators, like FDIC, do not withhold benefits like this. Why does our Office of Human Resources always seem to strive to block benefits, rather than to seek to enhance employee morale by granting benefits that are permitted by law?"

The SEC’s refusal to issue retroactive transportation subsidies up to the non-taxable amount of $250 per month to qualified bargaining unit employees for all of 2014, and its refusal to bargain over that retroactive increase, violates CBA Article 23, and also constitutes an unfair labor practice under 5 U.S.C. 7116(a)(1), (5), and (8).

As a remedy, the union has asked for make whole relief for impacted employees, including, but not limited to, retroactive payment of transportation subsidy benefits up to $250 per month for the months of January 2014 through December 2014, minus any monthly benefit amount already provided; interest on such amounts; attorney’s fees; an order to cease and desist from violating the parties’ collective bargaining agreements; a posting; and all other appropriate relief.