The Foreign Service Journal, December 2015

54 DECEMBER 2015 | THE FOREIGN SERVICE JOURNAL AFSA NEWS ISSUE BRIEF Update on Meritorious Service Increase Disputes On Sept. 3, the Foreign Service Grievance Board ruled in favor of AFSA’s implementation dispute, which it had filed on behalf of the 554 Foreign Service employees who never received the monetary component of their Meritorious Service Increases awarded by the 2013 selection boards. The FSGB decision found that the Department of State breached a provision regarding MSIs in the 2013 procedural precepts for the selection boards—a negotiated agreement with AFSA. In its ruling, the board directed the department to retroactively pay the 2013 MSIs, with interest, dating back to Nov. 3, 2013—the effective date of promotions. On Oct. 3, the department responded by filing excep- tions to the FSGB’s decision with the Foreign Service Labor Relations Board. It also requested that the FSGB temporarily stay its order to retroactively pay the 2013 MSIs, pending an FSLRB decision. The Grievance Board granted the request. Thus, 2013 MSI payments continue to be withheld, though interest is still accruing. The FSLRB must now assess whether the Grievance Board’s decision is deficient because it is contrary to any law, rule or regulation, or on other grounds similar to those applied by federal courts in private-sector labor-management relations. AFSA has 30 days to respond to the department’s exceptions. Background For more than 30 years the department and AFSA have negotiated and agreed on the procedural precepts (i.e., the “ground rules” for selection boards). The precepts include provisions relating to the award of MSIs to employees who were not promoted, but whose performance was of sufficient quality that an MSI was deemed appropriate by the selection boards. For approximately 30 years prior to 2013, MSIs were paid to whatever number of employees the selection boards recommended, up to a percentage limitation of the competitive class specified in the precepts. 2013 Sequester: In February 2013, as the federal government instituted precautionary financial measures in preparation for the 2013 sequester, the Office of Management and Budget issued a memo to the heads of all agencies stating that “increased scrutiny” should be paid by agencies in “issuing discretionary monetary awards to employees, which should occur only if legally required, until further notice.” On March 1, 2013, President Barack Obama signed an order issuing a budget sequestration. On March 8, 2013, the under secretary for management issued a directive ordering a freeze on monetary awards to department employees. On April 4, 2013, OMB issued another memo stating that discretionary monetary awards should not be issued while sequestration is in place, unless issuance of such awards is legally required. OMB said, “[l]egal requirements include com- pliance with provisions in collective bargaining agreements governing awards.” OMB also said that quality step increases (the civil service equivalent of an MSI) were not considered discretionary awards. On April 9, 2013, the department proposed the inclusion of new language in the precepts relating to MSIs. The new language stated that “If restricted by policy, regulation or budget from granting step increases of cash awards,” the department would recognize employees through a statement to their files, annotation of their scorecards and granting of bidding privileges. The proposal also stated, “if authorized, [the Bureau of Human Resources] will implement all MSIs and cash payments in lieu thereof as of the effective date of the promotion.” AFSA agreed to the department’s proposal due to its concerns that employees would be furloughed if it did not agree to suspend MSIs during sequestration. However, AFSA understood the new language to refer to policy, regulations or budget restrictions imposed by OMB, and that once these restrictions were lifted, HR would implement MSIs and cash payments as of the effective date of the promotion. When OMB and the Office of Personnel Management jointly issued a memo establishing budgetary limits on awards paid during fiscal year 2014 on Nov. 1, 2013, and when the president signed the fiscal year 2014 appropriations act on Jan. 17, 2014, AFSA argued that the conditions in the pre- cepts had been met and State was required to pay the 2013 MSIs. The department declined to do so, arguing that the Foreign Service Act of 1980 gave the department the sole discretion to either pay or not pay MSIs and that the “if authorized” lan- guage in the precepts referred to the department’s discretion, and not to any action by OMB or OPM. Dispute Details: AFSA filed an implementation dispute with the department on May 16, 2014. On June 30, 2014, the