BACKGROUND
From 1995, until the first CBA went into effect on October 1, 1999, there were several employees working at alternative workplaces pursuant to flexiplace agreements. The initial CBA formalized the flexiplace program in Article 26, establishing the Flexible Workplace Program (FWAP).

In October 2000, the Agency terminated the pre-existing flexiplace agreements of six grievants. The grievants included a Compliance Safety Officer (CSO) from the Indianapolis Resident Post who reported to the office one day each pay period and a CSO from the South Bend Resident Post who reported to the office one day each pay period but whose agreement stated she would report to the office "when necessary."

The Agency, in memos sent to the grievants terminating their flexiplace agreements, stated that the terminations were in compliance with the CBA. The Agency explained that the terminations were necessary because certain positions were not amenable to flexiplace agreements; office interaction was important for the employees; flexiplace agreements were negatively affecting the "ability to maintain adequate office coverage;" and the Agency was "prioritizing [flexiplace agreements] to maintain reasonable costs[.]"

The Agency also denied requests from several grievants for new flexiplace agreements. Those grievants included four CSOs from the Detroit and Grand Rapids offices, requesting flexiplace agreements that would vary in hours and days each week and two South Bend CSOs, requesting the same schedule as that given to the third CSO in that office, who reported to the office one day of each pay period.

The Union filed two grievances, alleging that the Agency improperly terminated existing flexiplace agreements and that the Agency improperly denied requests for new flexiplace agreements. The grievances were unresolved and were submitted to arbitration.

The Arbitrator first determined whether the CBA governed the pre-existing flexiplace agreements. The Arbitrator found the Agency's interpretation of Article 26, § 4(C) unconvincing. The Arbitrator, based on the email message from the Agency and the Agency's explicit references to and reliance on the CBA in the notices of termination, found that the provision did not mean that employees must request a flexiplace agreement during the first sixty days of the CBA term or forever lose their opportunity to do so. Thus, the Arbitrator determined that the Agency could only terminate the agreements "for cause" and interpreted § 7(A), the cause provision in the CBA, as requiring a change in circumstances that results in the agreement no longer meeting the contractual criteria.

The Arbitrator considered whether each flexiplace agreement was terminated "for cause." The Arbitrator determined that the terminations of the agreements of the CSO from Indianapolis and the CSO from South Bend were not "for cause." The Arbitrator found that the Agency presented no evidence to support its justifications for the terminations. The Arbitrator concluded that the remote access system was adequate until 2000 and the Agency did not present any evidence of a change that would warrant termination of the flexiplace agreements. The Arbitrator also decided that the termination of these agreements would not significantly increase office interaction because the CSO is the only employee in the Indianapolis office and the only employees in South Bend are CSOs who work in the field much of the time.

The Arbitrator then considered whether the denials of the requests for new flexiplace agreements were "fair[] and equitable[]." Addressing the requests made by the four CSOs from the Detroit and Grand Rapids offices, the Arbitrator found that these denials were "fair and equitable" in accordance with the CBA.

The Arbitrator found that the Agency improperly denied the request of the two CSOs from South Bend and that these grievants deserved the same consideration for flexiplace agreements as their counterpart, with the same position, in the same office, who had a pre-existing flexiplace agreement. The Arbitrator determined that the Agency's argument that the CSOs needed to be at the worksite to provide in-person office coverage was not convincing because the Agency did "not claim or prove the existing office coverage at South Bend, consisting mostly of a telephone answering machine to which the three CSOs faithfully attended through remote access, was inadequate for the needs of that post." The Arbitrator also found that one of the CSOs had an existing informal agreement and found no reason not to formalize it.

Based on his findings, the Arbitrator ordered the Agency to restore the flexiplace agreements of the CSO from South Bend and the CSO from Indianapolis. The Arbitrator ordered that the new requests of the two CSOs from South Bend be approved and the flexiplace agreements implemented immediately.

ANALYSIS
When an exception alleges that an award is contrary to law, the Authority reviews the question of law raised and the award de novo. NTEU, Chapter 24, 50 FLRA 330, 332 (1995). In applying de novo review, the Authority assesses whether an arbitrator's legal conclusions are consistent with the applicable standard of law. NFFE, Local 1437, 53 FLRA 1703, 1710 (1998). In making that assessment, the Authority defers to an arbitrator's underlying factual findings. Id.

When resolving an exception alleging that an award violates management's rights under § 7106 of the Statute, the Authority first determines whether the award affects a management right under § 7106(a). See United States Small Bus. Admin., 55 FLRA 179, 184 (1999). If it does, then the Authority applies the framework established in BEP. United States Dep't of the Treasury, Bureau of Engraving & Printing, Wash. D.C., 53 FLRA 146, 152-53 (1997) (BEP).

The right to determine organization encompasses the right to determine the administrative and functional structure of the agency, including the relationship of personnel through lines of authority and the distribution of responsibilities for delegated and assigned duties. See, e.g., United States Dep't of Transp., Fed. Aviation Admin., 58 FLRA 175, 178 (2002) (FAA); United States Dep't of Veterans Affairs, Conn. HealthCare Sys.; Newington, Conn., 57 FLRA 47, 48 (2001). The right also includes the authority to determine how an agency will structure itself to accomplish its mission and functions and the right to determine how the agency will be divided into organizational entities such as sections. See, e.g., FAA, 58 FLRA at 178; United States Dep't of Def., Nat'l Guard Bureau, Wash. Army Nat'l Guard, Tacoma, Wash., 45 FLRA 782 (1992); NTEU, Chapter 83, 35 FLRA 398, 410 n.5 (1990) (citing Congressional Research Employees Ass'n, 3 FLRA 737, 737-38 (1980)). Finally, the right to determine organization encompasses the right to determine "where organizationally certain functions shall be established and where the duty stations of the positions providing those functions shall be maintained." See \pard *AFGE, Local 3529, 55 FLRA 830, 832 (1999) (citing NTEU, Atlanta, Ga., 32 FLRA 886, 889-90 (1988)).

The Agency alleges that the award affects its organizational and administrative structure because the Arbitrator "permitted all the employees [in the South Bend office] to work at home 9 days out of [10 in each] pay period, thereby effectively eliminating the Agency's ability to maintain a functional operational resident post" and eliminating the Agency's ability to ensure that its facilities are capable of responding to the public. However, the factual finding, to which the Authority defers, does not support the conclusion that the Agency's right to determine its organization is affected because the Arbitrator found that office interaction would not significantly increase as a result of the termination of flexiplace agreements. Based on this finding, we conclude that the award does not affect the Agency's ability to maintain a functional operational post or determine its organizational structure.

The Agency also alleges that the award violates its right to assign work. According to Authority precedent, the right to assign work includes the right to determine the particular duties to be assigned, when work assignments will occur, and to whom or what positions the duties will be assigned. United States Dep't of Health and Human Servs., Health Care Financing Admin., 57 FLRA 462, 463 (2001) (HHS) (citing AFGE, Local 3529, 56 FLRA 1049, 1050 (2001)). The Agency argues that its right to assign work in this case includes the right to mandate the location where the work is performed because there is a nexus between the assignment to respond to members of the public and the location where this duty may be performed.

The Authority has held that if an agency establishes a relationship between job location and job duties, then a provision addressing job location would violate the right to assign work. United States Dep't of Health and Human Servs., Ctrs. for Medicare and Medicaid Servs., Baltimore, Md., 57 FLRA 704, 707 (2002) (HHS Baltimore) (citing NAGE, Local R1-109, 53 FLRA 526, 535 (1995). However, based on the Arbitrator's finding that employees have satisfactorily responded to the public, even while working under flexiplace agreements, the record does not support the conclusion that there is a nexus between the duties and the job location. Therefore, we find that the award does not affect the Agency's right to assign work in this manner.

In addition, the Agency argues that the award prevents it from assigning the grievants any other duties that would require them to be physically present in the office. Despite the Agency's allegations, there is nothing in the award that would preclude the Agency from assigning an employee duties that could only be performed in the office setting and modifying a flexiplace agreement accordingly.

The Arbitrator acknowledged that the Agency could terminate flexiplace agreements if it provided evidence that there was a change in circumstances such that the agreement no longer met the contractual criteria. The Arbitrator found that one of the agreements was properly terminated due to a "significant change in circumstances making it reasonable to conclude . . . the flexiplace [agreement] no longer met [contractual criteria] . . . ." However, the Arbitrator determined that the Agency did not present evidence of such a change in the flexiplace agreements at issue.

Additionally, the Arbitrator recognized that requests for flexiplace agreements could be denied if, for example, office interaction was required for an employee to successfully perform his/her duties. The Union concedes that the parties' CBA would clearly allow the Agency to cancel or disapprove a flexiplace agreement "due to a change in workload or duties[.]" In these circumstances, we conclude that the award does not preclude the Agency from assigning an employee duties that would require that employee to be physically present in the office.

Based on the determination that the award does not affect the Agency's management right to determine organization or the right to assign work, the BEP analysis is not applicable. United States Dep't of Veterans Affairs Med. Ctr., Coatesville, Pa., 56 FLRA 966, 971 (2000). Therefore, we dismiss the Agency's exception.

In order for an award to be found deficient as failing to draw its essence from the CBA, it must be established that the award: (1) cannot in any rational way be derived from the CBA; (2) is so unfounded in reason and fact and so unconnected with the wording and purposes of the CBA as to manifest an infidelity to the obligation of the arbitrator; (3) does not represent a plausible interpretation of the CBA; or (4) evidences a manifest disregard of the CBA. United States Dep't of Def., Def. Logistics Agency, Def. Distribution Ctr., New Cumberland, Pa., 55 FLRA 1303, 1306-07 (2000) (New Cumberland) (Member Cabaniss concurring); United States Dep't of Labor (OSHA), 34 FLRA 573, 575 (1990).

The Arbitrator concluded that the Agency violated Article 26 of the parties' CBA by improperly denying some of the grievants' requests for new flexiplace agreements. The Arbitrator assessed the denials of each individual grievant to determine if the request was disapproved "fairly and equitably on a case by case basis, consistent with Article 26 Section 3.A. and with Section 4 criteria."

The Agency's arguments do not support the conclusion that the award fails to draw its essence from the parties' CBA. The Agency argues that the Arbitrator's findings are contradictory by disapproving some but not all of the requests, and all the requests should have been disapproved because all CSOs have the same position description. However, the CBA specifically notes that participation in the flexiplace program is determined on a "case by case basis." Attachment 3, Article 26, § 4B. The CBA also goes on to note that "[s]ituations appropriate for flexiplace depend on the specific nature and content of the job, rather than just the job series and title."

Consequently, we conclude that the award does not fail to draw its essence from the CBA because the Arbitrator denied some but not all of the requests, and because the Arbitrator evaluated the requests on a case by case basis rather than treating all of the requests the same because all of the employees were CSOs and all had the same job description.

The Agency's exception also misstates the Arbitrator's actions when the Agency alleges that the Arbitrator's reasoning was that "what was good for [one employee whose flexiplace agreement had been approved] is also good for [two of the grievants]." To the contrary, the Arbitrator noted that, in terms of equity, the two grievants' claim of entitlement under the CBA "was as good as" that of the employee who already had permission for the same type of flexiplace agreement. Thus, this argument does not establish that the Arbitrator's approval of the two flexiplace requests was solely to provide a benefit already enjoyed by another employee.

The Agency's exception does not demonstrate that the award is unfounded, implausible or evidences a manifest disregard of the CBA. New Cumberland, 55 FLRA at 1306-07. Thus, the award does not fail to draw its essence from the parties' CBA. Accordingly, we deny the exception.

Posted: 01 Aug 04