HHS and NTEU, 74 FLRA No. 87

What happened

HHS and NTEU, 74 FLRA No. 87, Case No. 0-AR-6103, began as a union grievance over the Department of Health and Human Services' February 7, 2025 directive implementing the presidential memorandum titled Return to In-Person Work. Arbitrator Michael J. Falvo found that the directive violated Article 26 of the parties' collective-bargaining agreement and was an unfair labor practice. He ordered the agency to rescind it, reinstate terminated telework and remote-work agreements and post a notice.

The agency filed exceptions on February 17, arguing that the award rested on nonfacts (central facts that are clearly erroneous), failed to draw its essence from the agreement and exceeded the arbitrator's authority. The Authority checked the authorities in the agency's brief. It counted 22 of 29 footnotes, and 35 of 42 legal or record citations, as "fictitious, erroneous, or irrelevant."

The examples in the HHS and NTEU decision are specific. A decision cited as 913th Air Wing, 57 FLRA 469, "does not exist." Nine more citations, among them 43 FLRA 852 and 68 FLRA 677, were described as entirely fictitious. Eleven did not support the propositions cited, and 10 more had partially incorrect citations as well. AFGE Local 2921, 50 FLRA 184, was cited at pages 187-88, although the decision ends on page 186. A Navy decision at 55 FLRA 687 was cited for granting a nonfact exception that it in fact denied.

What the Authority did

On October 21 the Authority denied every exception. It rejected one nonfact argument as unsupported under section 2425.6(e)(1) of its regulations, noting that one supporting case was fictitious and the other three did not address the point. It then wrote: "Based on the nature and scope of these errors, it appears that the Agency may have used a generative artificial-intelligence (AI) tool in drafting its brief."

The Authority added that "nothing prohibits parties from using AI tools when preparing filings for submission to the Authority," but cautioned that AI "continues to present significant risks of error" and that parties should verify AI-generated material. For the same caution it cited American Backflow & Fire Prevention, 375 NLRB No. 31, and a GAO bid-protest decision, Raven Investigations. It imposed no sanction and made no referral, and it made no finding about who drafted the brief or which tool, if any, was used.

The decision is available as a PDF copy.

Where it stands

The HHS and NTEU decision leaves the arbitrator's award in place, including rescission of the directive and reinstatement of the terminated agreements. Two members decided the case; the third did not participate. Any request for reconsideration, compliance proceedings or internal review of how the brief was prepared were not located as of October 30.

The obligation it engaged

The agency's brief engages Clause 3 of the Standard, independent authority: every citation is confirmed against an independent source before it enters the work. The Authority did that confirmation itself, reporter by reporter, and found most of the brief's support missing or misdescribed. Clause 4, checkability before adoption, applies as well. Each failed citation was checkable, and none appears to have been checked before filing.

For an expert, HHS and NTEU shows how such a review reads in practice. A tribunal or opposing counsel can count a report's footnotes, test each one and publish the ratio. The Authority did not need to show that AI was used; the errors alone left the agency's arguments without support. An expert whose report carries legal, regulatory or technical citations should expect the same audit, and should complete it before signing.

Sources

• Federal Labor Relations Authority (copy hosted by Damien Charlotin's AI Hallucination Cases database) · October 21, 2026
  U.S. Department of Health and Human Services and National Treasury Employees Union, 74 FLRA No. 87

What could not be confirmed

The decision was read from an OCR text of a scanned copy; quotations were checked against that text, which renders AI as Al and drops some apostrophes. The Authority made no finding on who drafted the brief or what tool was used. The case number appears in the OCR as 0-AR-6103. Any reconsideration, compliance or internal review was not located as of October 30, 2026.