NTEU Is Pressing the SEC to Comply with the WIGI Order

07/21/2009

In June, the United States Court of Appeals for the District of Columbia Circuit ruled in NTEU’s favor on the SEC’s appeal of a decision by the Federal Labor Relations Authority (FLRA) requiring the SEC to make back pay distributions to all SEC employees who should have received within grade increases (WIGIs) in 2002. As this newsletter went to press, NTEU and the SEC were discussing these back pay distributions. The Union will notify all employees as soon as the details are worked out.

Under the original order entered by arbitrator and subsequently affirmed by both the FLRA and the DC Circuit, the agency is required to take the following steps:

(1) Review employee personnel files to ascertain which employees met the time-in-grade and other longevity requirements for a step increase between May 19 and November 8 2002;

(2) For those employees who met the longevity requirements during that period, review their performance appraisals for the corresponding period to ascertain which employees performed at an “acceptable” level;

(3) Grant one-step increases, under the SEC’s pay schedule in existence prior to May 19, 2002, to all employees who meet the two criteria above, retroactive to the date each employee met the longevity requirements;

(4) Taking into account the step increases given to those employees identified above, determine the appropriate placement of those employees in the new pay schedule implemented by the SEC in 2002 and adjust such employees’ pay and benefits as of the date each employee qualified for a step increase; and

(5) Make whole the employees identified above by paying them back pay, with interest, for all pay they lost because of the SEC’s failure to give them step increases prior to the conversion to the new pay schedule, between the date they qualified for step increases until the date of compliance.

Chapter 293 is recommending a claims process under which the affected employees identified by the SEC will be notified and told how much they will receive and the date by which they will receive the payment. All other employees will be notified and afforded the opportunity to demonstrate that they should be on the list. The Union has urged the SEC to agree to a schedule for this process. If we are unable to do so, we will return to the FLRA to seek enforcement of compliance with its order.

By way of background, this case began when NTEU filed an Unfair Labor Practice (ULP) complaint against the SEC in 2002, asserting that the agency had violated federal labor law by unilaterally terminating WIGIs without first completing bargaining with the Union over the implementation of its new pay system. The SEC ceased giving WIGIs as of May 19, 2002, adversely affecting many SEC employees who were due to receive salary raises. This state of affairs continued for approximately six months until November 8, 2002, when the Federal Service Impasses Panel finally issued a decision regarding the compensation negotiations impasse between NTEU and the SEC. The SEC filed this appeal last July, after the FLRA rejected the agency’s first appeal from NTEU’s initial arbitration victory.

As a direct result of the SEC’s decision to proceed with the appeal to the DC Circuit in this case, for the past year hundreds of the agency’s own employees did not receive the back pay to which they were entitled as a result of the agency’s violation of federal labor law. Instead, those employees were required to wait for a final decision by the DC Circuit. Indeed, those employees have waited now for seven years.

On June 12, the DC Circuit upheld the FLRA’s decision and rejected the SEC’s claim that the FLRA should have afforded deference to the agency’s choice to unilaterally implement its pay system. The Court also found that the SEC had failed to meet its burden to prove its chosen affirmative defense -- that its unilateral implementation of the new pay system by May 19, 2002 was somehow “necessary to the functioning of the agency” -- because it failed to show that the change was in response to any “overriding exigency” or some similarly compelling need.

After the DC Circuit’s decision, Chapter 293 President Greg Gilman noted that “This case once again demonstrates that, when faced with the need to litigate to vindicate employees’ rights, NTEU will persist in the fight, even in the face of years of obstacles thrown in its path by agency management. Chapter 293 now stands ready to work with the SEC to ensure that it remedies its past violations of federal labor law by making back pay distributions to all affected employees in a fair and expeditious fashion. We also look forward to working closely with new senior management at the SEC to ensure that the poor decisions of previous agency leaders on compensation issues, such as the decisions made in this case, will become a thing of the past. Thank you to all of the dues paying NTEU members at the SEC, without whom it would not be possible for the Union to pursue matters like this one.”