US SUPREME COURT DECISIONS

Under the Civil Service Reform Act of 1978 (Act), a federal employee may challenge agency disciplinary action by appealing the agency's decision to the Merit Systems Protection Board (Board), or, if he is a member of a federal employees' labor union, he may, in the alternative, challenge the action through any grievance and arbitration procedure provided by the collective bargaining agreement between the agency and the union. Under 5 U.S.C. § 7701(c)(2)(A), the Board may not sustain the agency's action if the employee "shows harmful error in the application of the agency's procedures in arriving at such decision." The Act also requires an arbitrator to apply this "harmful error" rule in grievance and arbitration procedures under a bargaining agreement. Two employees of the General Services Administration (GSA), members of a union having a bargaining agreement with the GSA, were removed from their jobs for falsification of records and other reasons. When the employees were first interrogated about the wrongdoing, and later when they admitted it in sworn affidavits, they were not advised that they were entitled to have a union representative present. The employees also did not receive notices of proposed removal until almost three months after the wrongdoing. The employees challenged their removals under the bargaining agreement's grievance and arbitration procedures. The arbitrator, while finding that the wrongdoing normally would justify removal, also found that the GSA had committed procedural errors in violation of the bargaining agreement by failing to give the employees an opportunity to have a union representative present during interrogation and by unreasonably delaying issuance of the notices of proposed removal. The arbitrator concluded that, although the errors did not prejudice the employees, the removals were not for just cause. Accordingly, the arbitrator reduced the penalties to two weeks' suspension without pay. The Court of Appeals affirmed in substantial part, holding that although the employees were not prejudiced, the arbitrator, in making the ultimate award, could take into account significant violations of the bargaining agreement that were important to the union, because such violations were tantamount to "harmful error" to the union within the scope of § 7701(c)(2)(A). The Court of Appeals also ruled that the chanrobles.com-red

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reduction of the penalties was a proper means of "penalizing the agency" for disregarding the agreement's procedural protections.

Held: Under § 7701(c)(2)(A), the employee-grievant must show error that caused substantial prejudice to his individual rights by possibly affecting the agency's decision. Pp. 472 U. S. 657-665.

(a) The Board has so interpreted § 7701(c)(2)(A) in its regulation defining "harmful error," and its interpretation is entitled to deference. To apply a different definition of "harmful error" in an arbitral context than in a Board proceeding, so as to permit an arbitrator to overturn agency disciplinary action on the basis of a violation of a bargaining agreement that is harmful only to the union, would directly contravene the Act's purpose of promoting consistency in resolving federal employee grievances and avoiding forum shopping. Pp. 472 U. S. 657-662.

(b) Moreover, the "harmful error" rule must be interpreted as the Board interprets it if the underlying purpose of the Act of maintaining an effective and efficient Government, and the particular purpose of § 7701 to give agencies greater ability to remove or discipline erring employees expeditiously, are to be carried out. The purpose of the Act of strengthening federal employee unions and making the collective bargaining process more effective is not undermined by application of the Board's interpretation of the "harmful error" rule in the arbitral context. Under any interpretation of the rule, unions are free to bargain for procedures to govern agency actions, and agencies must follow agreed-upon procedures. If the agency violates these procedures with prejudice to the individual employee's rights, any resulting agency disciplinary decision will be reversed. Whether or not there is prejudice to the individual employee, the union may file a grievance in its own behalf and, in the case of a clear breach of the agreement, may file an unfair labor practice charge with the Federal Labor Relations Authority. Thus, the union has adequate remedies of its own for enforcing agency compliance with the procedural requirements of the bargaining agreement. Pp. 472 U. S. 662-665.

718 F.2d 1048, reversed.

BLACKMUN, J., delivered the opinion of the Court, in which BURGER, C.J.,and WHITE, REHNQUIST, STEVENS, and O'CONNOR, JJ., joined. MARSHALL, J., filed a dissenting opinion, in which BRENNAN, J., joined, post, p. 472 U. S. 666. POWELL, J., took no part in the decision of the case. chanrobles.com-red

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