Claim for Damages and Fees Gets Second Look

In Hollingsworth v. Dept. of Commerce, 2011 MSPB 26 (February 18, 2011), the Merit Systems Protection Board exercised its authority under 5 U.S.C. § 7121(d) to review an arbitrator's decision which involved an allegation of discrimination. The Board found that the arbitrator committed violations of law by not addressing the employee's claims for compensatory damages and for reimbursement of attorneys' fees.

In Hollingsworth, the employee filed a grievance under her collective bargaining agreement when she was removed from employment after claiming that she was a qualified individual with a disability and entitled to reasonable accommodations. The Department of Commerce removed Hollingsworth for "unavailability" for work. However, Hollingsworth had presented medical documentation supporting her claims of asthma and allergies and requested reasonable accommodations. Rather than accommodate Hollingsworth as a disabled employee, as required under the Rehabilitation Act, the department removed her from her position and federal service. When her grievance was not resolved, Hollingsworth's union processed the matter to arbitration.

The arbitrator found that Hollingsworth established that she was a qualified individual with a disability and that the agency failed to provide her with a reasonable accommodation as required under the Rehabilitation Act. Accordingly, the arbitrator ordered the Department of Commerce to reinstate Hollingsworth with back pay, and to provide her with reasonable accommodation. Hollingsworth also requested compensatory damages (such as for emotional distress and medical expenses) as well as reimbursement of attorneys' fees incurred in the arbitration. Without explanation, the arbitrator denied these remedies. Hollingsworth requested a clarification from the arbitrator and the deadline for submitting her petition for attorneys' fees and compensatory damages. The arbitrator ruled that no clarification of his award was required and denied the employee's request.

On appeal to the MSPB, Hollingsworth challenged the arbitrator's failure to award her attorneys' fees and compensatory damages. The Board has jurisdiction to review an arbitrator's decision under 5 U.S.C. § 7121(d) when the subject matter of the grievance is one over which the MSPB would have jurisdiction (such as a removal), the employee has alleged discrimination in the grievance, and a final arbitration decision has been issued. The scope of the Board's review of an arbitrator's award is limited; an arbitrator's factual determinations are normally entitled to deference, unless the arbitrator errs in his legal analysis. In this case, a review of the arbitrator's 45-page decision revealed no mention of the employee's request for attorneys' fees or compensatory damages. Because the arbitrator made no specific findings on the issues of attorneys' fees or compensatory damages, the Board found that his decision to deny those requests was not entitled to deference. Moreover, because the arbitrator did not cite any legal standard, or apply any legal analysis in denying the appellant's request for attorney's fees and compensatory damages, the Board found that the arbitrator made legal errors that permit the Board to make its own findings.

Because there had been no prior hearing before an MSPB administrative judge, as this matter was heard by an arbitrator, the Board found that the appropriate manner for it to resolve this dispute was to remand the case to an administrative judge for the taking of evidence on the issue of Hollingsworth's entitlement to compensatory damages. The judge is to make a recommendation to the three-member Board for the ultimate decision on the amount of compensatory damages, if any, to which Hollingsworth is entitled. If the Board finds that Hollingsworth is entitled to compensatory damages, and is therefore a "prevailing party," she may initiate an addendum proceeding for attorneys' fees after the conclusion of the compensatory damages matter.

* This information is provided by the attorneys at Passman & Kaplan, P.C., a law firm dedicated to the representation of federal employees worldwide. For more information on Passman & Kaplan, P.C., go to http://www.passmanandkaplan.com.