B-150596, JANUARY 24, 1963, 42 COMP. GEN. 395

B-150596: Jan 24, 1963

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ARE NONPERSONAL SERVICES WHICH MAY BE PROCURED BY CONTRACT RATHER THAN SERVICES REQUIRED TO BE PROCURED UNDER THE CONSULTANT EMPLOYMENT AUTHORITY IN SECTION 15 OF THE ADMINISTRATIVE EXPENSES ACT OF 1946. ASKS OUR OPINION CONCERNING THE RATE OF COMPENSATION WHICH MAY BE PAID TO ARBITRATORS WHOSE SERVICES ARE ENGAGED UNDER SECTION 11 OF EXECUTIVE ORDER NO. 10988. OR OF ANY EMPLOYEE ORGANIZATION WHICH IS SEEKING EXCLUSIVE RECOGNITION AND WHICH QUALIFIES FOR OR HAS BEEN ACCORDED FORMAL RECOGNITION. SHALL NOMINATE FROM THE NATIONAL PANEL OF ARBITRATORS MAINTAINED BY THE FEDERAL MEDIATION AND CONCILIATION SERVICE ONE OR MORE QUALIFIED ARBITRATORS WHO WILL BE AVAILABLE FOR EMPLOYMENT BY THE AGENCY CONCERNED FOR EITHER OR BOTH OF THE FOLLOWING PURPOSES.

B-150596, JANUARY 24, 1963, 42 COMP. GEN. 395

UNIONS - FEDERAL SERVICE - ARBITRATION SERVICES - CONTRACTING PROCEDURES. UNIONS - FEDERAL SERVICE - ARBITRATION SERVICE - CONTRACTING PROCEDURES THE SERVICES OF ARBITRATORS UNDER SECTION 11 OF EXECUTIVE ORDER NO. 10988, CONCERNING FEDERAL SERVICE EMPLOYEE-MANAGEMENT COOPERATION, TO INVESTIGATE, SUPERVISE, AND RENDER ADVISORY DECISIONS ON MATTERS OF UNION RECOGNITION, FREE FROM SUPERVISION OR CONTROL BY THE GOVERNMENT, ARE NONPERSONAL SERVICES WHICH MAY BE PROCURED BY CONTRACT RATHER THAN SERVICES REQUIRED TO BE PROCURED UNDER THE CONSULTANT EMPLOYMENT AUTHORITY IN SECTION 15 OF THE ADMINISTRATIVE EXPENSES ACT OF 1946, 5 U.S.C. 55A, AND, THEREFORE, THE FEE LIMITATIONS APPLICABLE TO CONSULTANT HERE DO NOT PRECLUDE THE EMPLOYMENT OF ARBITRATORS BY CONTRACT AT RATES COMMENSURATE WITH THOSE PAID IN PRIVATE LABOR MANAGEMENT FIELDS. THE EXECUTION OF NONPERSONAL SERVICE CONTRACTS FOR THE EMPLOYMENT THE EXECUTION OF NONPERSONAL SERVICE CONTRACTS FOR THE EMPLOYMENT OF ARBITRATORS PURSUANT TO EXECUTIVE ORDER NO. 10988, RELATING TO FEDERAL SERVICE EMPLOYEE-MANAGEMENT COOPERATION, ON A GENERAL "WHEN NEEDED" BASIS WITH THE DEPARTMENT OF LABOR RATHER THAN ON AN INDIVIDUAL AGENCY BASIS WOULD NOT COMPLY WITH SECTION 11 OF THE ORDER SPECIFYING "EMPLOYMENT BY THE AGENCY CONCERNED; " THEREFORE, NOTWITHSTANDING ADMINISTRATIVE CONVENIENCE OF GENERAL CONTRACTS, THE PARTICULAR AGENCY REQUIRING THE SERVICES OF ARBITRATORS SHOULD EXECUTE INDIVIDUAL CONTRACTS FOR ARBITRATION SERVICES.

TO THE SECRETARY OF LABOR, JANUARY 24, 1963:

YOUR LETTER OF JANUARY 9, 1963, WITH ENCLOSURE, ASKS OUR OPINION CONCERNING THE RATE OF COMPENSATION WHICH MAY BE PAID TO ARBITRATORS WHOSE SERVICES ARE ENGAGED UNDER SECTION 11 OF EXECUTIVE ORDER NO. 10988, PERTAINING TO EMPLOYEE-MANAGEMENT COOPERATION IN THE FEDERAL SERVICE, AND AS TO THE MANNER IN WHICH SUCH SERVICES SHOULD BE PROCURED.

SECTION 11 OF THE EXECUTIVE ORDER, SO FAR AS HERE PERTINENT, READS:

* * * UPON THE REQUEST OF ANY AGENCY, OR OF ANY EMPLOYEE ORGANIZATION WHICH IS SEEKING EXCLUSIVE RECOGNITION AND WHICH QUALIFIES FOR OR HAS BEEN ACCORDED FORMAL RECOGNITION, THE SECRETARY OF LABOR, SUBJECT TO SUCH NECESSARY RULES AS HE MAY PRESCRIBE, SHALL NOMINATE FROM THE NATIONAL PANEL OF ARBITRATORS MAINTAINED BY THE FEDERAL MEDIATION AND CONCILIATION SERVICE ONE OR MORE QUALIFIED ARBITRATORS WHO WILL BE AVAILABLE FOR EMPLOYMENT BY THE AGENCY CONCERNED FOR EITHER OR BOTH OF THE FOLLOWING PURPOSES, AS MAY BE REQUIRED: (1) TO INVESTIGATE THE FACTS AND ISSUE AN ADVISORY DECISION AS TO THE APPROPRIATENESS OF A UNIT FOR PURPOSES OF EXCLUSIVE RECOGNITION AND AS TO RELATED ISSUES SUBMITTED FOR CONSIDERATION; (2) TO CONDUCT OR SUPERVISE AN ELECTION OR OTHERWISE DETERMINE BY SUCH MEANS AS MAY BE APPROPRIATE, AND ON AN ADVISORY BASIS, WHETHER AN EMPLOYEE ORGANIZATION REPRESENTS THE MAJORITY OF THE EMPLOYEES IN A UNIT. CONSONANT WITH LAW, THE SECRETARY OF LABOR SHALL RENDER SUCH ASSISTANCE AS MAY BE APPROPRIATE IN CONNECTION WITH ADVISORY DECISIONS OR DETERMINATIONS UNDER THIS SECTION, BUT THE NECESSARY COSTS OF SUCH ASSISTANCE SHALL BE PAID BY THE AGENCY TO WHICH IT RELATES. * * *

IN THE LIGHT OF THE LANGUAGE QUOTED ABOVE YOU ASK SPECIFICALLY WHETHER THE SERVICES OF THE ARBITRATORS REFERRED TO WOULD BE VIEWED AS NONPERSONAL SUCH AS MIGHT BE RENDERED BY AN INDEPENDENT CONTRACTOR, OR WHETHER THEY WOULD BE REGARDED AS THOSE OF AN INTERMITTENT CONSULTANT APPOINTED AND EMPLOYED UNDER SECTION 15 OF THE ADMINISTRATIVE EXPENSES ACT OF 1946, AS AMENDED, 5 U.S.C. 55A, WHOSE PER DIEM COMPENSATION WOULD BE LIMITED BY THE PROVISIONS OF THAT SECTION OR BY SPECIFIC STATUTES OR APPROPRIATION ACTS PERTAINING TO THE DEPARTMENT OR AGENCY CONCERNED. ALSO, YOU ASK WHETHER THE MANNER OF CONTRACTING FOR THEIR SERVICES WOULD AFFECT THE LEGAL RELATIONSHIP OF SUCH INDIVIDUALS TO THE AGENCY, I.E., THE DETERMINATION AS TO WHETHER THEY ARE INDEPENDENT CONTRACTORS OR EMPLOYEES, AND THE RATE OF COMPENSATION WHICH THEY MAY BE PAID.

YOU POINT OUT THAT ARBITRATORS ORDINARILY WILL USE STENOGRAPHIC AND SPACE FACILITIES OF THE AGENCY DURING THE CONDUCT OF HEARINGS, BUT GENERALLY WILL USE THEIR OWN FACILITIES IN THE PREPARATION OF WRITTEN OPINIONS. THEY WILL NOT BE SUBJECT TO GOVERNMENT SUPERVISION AND WILL BE RESPONSIBLE FOR THEIR OWN DECISIONS. FURTHER, YOU SAY THAT THE NEED FOR COMPENSATING ARBITRATORS AT RATES ABOVE THOSE PROVIDED BY LAW FOR THE EMPLOYMENT OF CONSULTANTS ARISES FROM THE FACT THAT QUALIFIED AND IMPARTIAL ARBITRATORS USUALLY RECEIVE PER DIEM FEES HIGHER THAN THOSE PROVIDED BY LAW FOR EMPLOYEE CONSULTANTS. THUS, TO SUCCESSFULLY IMPLEMENT THE EXECUTIVE ORDER, IT IS YOUR VIEW THAT THEY MUST BE PAID RATES COMMENSURATE WITH THOSE PAID TO THEM IN PRIVATE LABOR-MANAGEMENT FIELDS.

ASIDE FROM THE APPARENT INCOMPATIBILITY OF THE MASTER AND SERVANTOR EMPLOYER-EMPLOYEE RELATIONSHIP WITH THE NECESSARY INDEPENDENCE AND OBJECTIVITY REQUIRED OF THE ARBITRATORS IN THEIR WORK, WE CONSISTENTLY HAVE RULED THAT WHEN AN INDIVIDUAL IS RESPONSIBLE FOR AN END RESULT--- IN THIS INSTANCE THE ADVISORY DECISION OR DETERMINATION--- AND IS REQUIRED BY THE NATURE OF THE SERVICE TO ATTAIN THAT RESULT FREE OF SUPERVISION OR CONTROL OF THE GOVERNMENT, HE MAY BE REGARDED AS AN INDEPENDENT CONTRACTOR RATHER THAN AN EMPLOYEE. 28 COMP. GEN. 50. THEREFORE, OUR VIEW IS THAT THE SERVICES OF ARBITRATORS ARE NONPERSONAL. IT FOLLOWS THAT THEIR SERVICES, TO THE EXTENT OTHERWISE AUTHORIZED, SHOULD BE PROCURED BY CONTRACTS SPECIFYING THE RATES OF COMPENSATION AND OTHER CONDITIONS UNDER WHICH THEIR NONPERSONAL SERVICES WILL BE ENGAGED. SEE 41 U.S.C. 5.

YOU POINT OUT THAT EACH GOVERNMENT AGENCY REQUIRED TO USE ARBITRATORS COULD SIGN INDIVIDUAL CONTRACTS. YOU SAY, HOWEVER, THAT THE TOTAL EXPENSE TO THE GOVERNMENT AND ADMINISTRATIVE CONVENIENCE MAKE IT PREFERABLE THAT EACH ARBITRATOR SIGN A GENERAL "WHEN NEEDED" CONTRACT WITH THE SECRETARY OF LABOR. OUR OPINION IS THAT THE LANGUAGE "FOR EMPLOYMENT BY THE AGENCY CONCERNED" IN SECTION 11 OF EXECUTIVE ORDER NO. 10988, BY ITS TERMS, REQUIRES THAT THE CONTRACTS WITH THE ARBITRATORS BE WITH THE AGENCY CONCERNED, RATHER THAN WITH THE SECRETARY OF LABOR. THEREFORE, ANY SUCH CONTRACTS SHOULD BE SO EXECUTED.