Last Chance Agreement can Impose Additional Conditions upon Agreeing Employee, even if other Employees would not receive Same Discipline in Same Circumstances, Federal Circuit holds

An employee who agrees to a last chance agreement (LCA) is bound by its terms, and an agency is free to impose additional conditions upon an employee in relation to an LCA, even if the agency would not impose the same discipline to other employees under the same circumstances, the Federal Circuit recently held.

Vallire Scott worked for the U.S. Department of Agriculture (USDA). In June 2010, USDA proposed her removal on charges of discourteous conduct and failure to follow proper leave-approving procedures. The following month, the agency and Scott entered into a last chance agreement (LCA) which required Scott to, among other things, call her supervisor before 8:55 a.m. to request unplanned or emergency leave. Scott also agreed to waive all appeal rights if she was terminated for failure to meet any of the conditions in the LCA.

In October 2010, Scott called her supervisor at 9:07 a.m. to let him know she was going to be late for her tour of duty. In November 2010, the agency issued a decision removing Scott for violating the LCA the previous month.

Scott appealed to the Merit Systems Protection Board (the Board) and challenged the agency’s removal decision. The Board issued an initial decision dismissing Scott’s appeal for lack of jurisdiction after finding that Scott had failed to make a non-frivolous allegation that she had complied with the LCA, that the agency had breached the LCA or that the LCA was a result of fraud or mutual mistake. Scott appealed to the U.S. Court of Appeals for the Federal Circuit.

The Federal Circuit ultimately affirmed the Board’s decision that it lacked jurisdiction over Scott’s appeal. First, Scott never disputed that she waived her appeal rights when she signed the LCA. Scott would have to prove compliance with the LCA, that the agency breached the agreement or that she did not knowingly or voluntarily enter into the agreement to overcome the waiver and establish the Board’s jurisdiction. 

Scott argued that USDA materially breached the LCA by holding her to an allegedly illegal leave and attendance policy. Specifically, Scott pointed to a September 2011 settlement agreement between USDA and her labor union that rescinded the policy requiring her to call by 8:55 a.m. to request unplanned or emergency leave and established instead that she had until 10:00 a.m. to notify her supervisor of her late arrival.

The court disagreed. The court explained that there was no indication in the record that the 2011 settlement agreement was intended to retroactively modify pre-existing LCAs and that Scott and USDA were bound by the LCA’s terms by which they agreed. 

Scott also argued that the agency breached the LCA by holding her to a stricter leave and attendance policy than permitted by the settlement agreement. The court rejected Scott’s argument and went on to explain that an agency can impose additional conditions upon an employee through an LCA and can discipline the employee if he or she fails to comply with the condition, regardless of whether other employees would not be disciplined under the same or similar circumstances.

Therefore, the court affirmed the Board’s decision that it lacked jurisdiction to review Scott’s termination.

The case is Scott v. Department of Agriculture, and is available here.

Posted in Case Law Update

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