Employee has Right to Withdraw Voluntary Demotion Request Before Effective Date Unless Agency has Valid Reason to Refuse to Allow the Withdrawal, MSPB Holds

An employee has a right to withdraw an alleged voluntary demotion request at any time before its effective date unless the agency has a valid reason for refusing to permit the withdrawal, the Merit Systems Protection Board recently held in a precedential decision.

In October 2010, Jodie Loredo’s immediate supervisor, Charmian Setear, told her that the agency decided to reassign her from her IR-11 Supervisory Clerk position to either a lateral management position or a downgrade to a Tax Examiner position. Several weeks later, Loredo signed a memorandum that stated she voluntarily requested reassignment to a GS-5/6 Tax Examiner position in another department, acknowledging that the reassignment was a downgrade and that the decision was voluntary. A few days later, Loredo stated she declined the downgrade to the GS-5/6 Tax Examiner position. Nevertheless, the agency effected Loredo’s demotion to a GS-05 Tax Examining Technician position in November 2010.

Loredo then filed an equal employment opportunity complaint alleging that the demotion was involuntary and that the agency had discriminated against her on the basis of religion and retaliated against her for prior EEO activity. The agency issued a Final Agency Decision and Loredo filed an appeal with the Board. In an initial decision, the administrative judge dismissed Loredo’s appeal for lack of jurisdiction, and Loredo filed a petition for review, reiterating her arguments that the agency’s alleged premise for downgrading her was false and that the agency’s real reason for the downgrade was religious discrimination because of her Jewish faith.

Ultimately, the Board found that Loredo’s arguments provided no basis to disturb the initial decision.  First, the Board looked at the administrative judge’s finding that the testimony of Loredo’s subordinates supported the agency’s stated reason for its actions. One of Loredo’s former subordinates, Joyce Nevarez, had testified that she had requested to be transferred from Loredo’s team because of her management style. Another former subordinate testified that she left Loredo’s team because it had an “unpleasant atmosphere.” Therefore, the Board found that the administrative judge’s findings were supported by hearing testimony.

The Board also found unpersuasive Loredo’s assertion that the real reason for the agency’s action was religious discrimination. Because Loredo raised the allegation of religious discrimination in connection with a claim of involuntariness, the allegation could only be addressed insofar as it relates to the voluntariness issue, the Board explained, “[t]hus, evidence of discrimination goes to the ultimate question of coercion, i.e., whether under all of the circumstances, working conditions were made so difficult by the agency that a reasonable person in the employee’s position would have felt compelled to request a demotion.”

While Loredo asserted that she was subjected to religious slurs and religious counseling sessions, the Board found that she failed to provide sufficient evidence that would establish that a reasonable person would have felt compelled to accept a demotion under the circumstances, primarily because Loredo merely stated that her manager subjected to religious counseling sessions that only talked about people of different religions.

However, the Board did question whether Loredo’s demotion became involuntary once she withdrew her voluntary demotion request. In cases concerning withdrawals of resignations and retirements, the Board has held that “an employee has a right to withdraw an alleged voluntary demotion request at any time before its effective date unless the agency has a valid reason for refusing to permit the withdrawal.” The agency has the burden of proving by preponderant evidence that it has a valid reason, which can include administrative disruptions or the hiring of a replacement, the Board said.

In this case, Loredo stated that her decision to decline the downgrade to a GS-5/6 Tax Examiner position occurred before her demotion was effected in November 2010. However, the administrative judge below failed to address the issue. Therefore, the Board remanded the matter so that the parties could submit further evidence regarding that issue.

The case is Loredo v. Department of the Treasury and is available here.

 

Posted in Case Law Update

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