VA Penalty Determinations Under New Title 38 Authority Is Reviewable By MSPB, New Authority Cannot Be Retroactively Applied
Congress did not intend to give the Department of Veterans Affairs carte blanch to impose penalties against non-executive career employees without review, the Federal Circuit held last week.
In 2003, VA promoted Dr. Jeffrey Sayers to his position as Chief of Pharmacy Services for the Greater Los Angeles VA Health Care System. In June 2016, a VA site-visit team discovered violations of VA policy in the pharmacies under Sayers’s supervision. When Sayers failed to follow orders to immediately correct these violations, VA detailed him out of his position pending further review.
On June 23, 2017, President Trump signed the Department of Veterans Affairs Accountability and Whistleblower Protection Act (DVAAWPA) into law. The new law, in part, created new expedited, less rigorous alternatives to traditional civil service processes for VA to remove its career employees. Three months later, in September 2017, VA invoked DVAAWPA’s new process for non-executive career employees to propose Sayers’s removal on ten specifications alleging he committed misconduct prior to the DVAAWPA’s enactment.
Sayers exercised his limited DVAAWPA rights to reply to VA’s proposal, and VA ultimately removed him effective November 7, 2017. Sayers then appealed his removal for a hearing before a Merit Systems Protection Board. The Administrative Judge held the DVAAWPA authorized her only to review whether Sayers committed the alleged misconduct and prohibited her from passing any judgment on the validity of the removal penalty that VA applied to the misconduct. She then ultimately sustained nine of the VA’s ten specifications against Sayers and held the DVAAWPA required her to affirm VA’s chosen removal penalty.
Because neither party appealed the Administrative Judge’s decision to the vacant three-member Board, the decision became a final MSPB decision. Sayers then appealed the decision to the U.S. Court of Appeals for the Federal Circuit.
On appeal, Sayers raised myriad arguments why the Federal Circuit should reverse the MSPB’s decision. The Federal Circuit addressed two of those arguments in its decision on Sayers’s case.
First, the Court addressed the MSPB’s authority to review VA’s chosen penalty. The DVAAWPA requires MSPB administrative judges “shall uphold the decision of [VA]…if the decision is supported by substantial evidence.” VA argued this provision limits the MSPB’s review to only the facts underlying an adverse action, not to the penalty VA applied to charged misconduct. The Federal Circuit disagreed and held the plain meaning of “the decision” referred to in the DVAAWPA provision is the decision “to remove, demote, or suspend [the] employee.” The Court concluded thus that the MSPB “cannot meaningfully review that decision if it blinds itself to the VA’s choice of action.”
Second, the Court turned to Sayers’s argument that VA impermissibly applied the DVAAWPA retroactively to his alleged conduct that occurred prior to the law’s enactment. The Court began with settled Supreme Court precedent that statutes generally apply only prospectively unless Congress expresses a “clear intent” that a provision should apply retroactively. Because the DVAAWPA provision used to remove Sayers is silent on retroactivity, and the DVAAWPA “does not reveal any intent that [the provision] apply retroactively,” the Federal Circuit continued its analysis to determine whether “application of the statute to the conduct at issue would result in a retroactive effect.”
The Supreme Court describes “retroactive effect” as whether a statute would “impair rights a party possessed when he acted, increase a party’s liability for past conduct, or impose new duties with respect to transactions already completed.” Applying that analysis to the DVAAWPA provision used to remove Sayers, the Federal Circuit concentrated on the new law’s reduction in the standard of proof from “preponderant evidence” in the pre-existing removal process to “substantial evidence” required for MSPB to sustain VA’s charges. The reduction in standard of proof, under which an employee like Sayers could be removed “even if that consequence goes against the weight of the evidence” unquestionably diminished Sayers’s property right in his continued federal employment.
On these two bases, the Federal Circuit vacated the MSPB’s decision affirming Sayers’s removal from federal service and remanded the matter to MSPB for further proceedings consistent with the Court’s opinion.
Review the full U.S. Court of Appeals for the Federal Circuit opinion: Sayers v. Department of Veterans Affairs
This case law update was written by James P. Garay Heelan, Associate Attorney, Shaw Bransford & Roth, PC.
For thirty years, Shaw Bransford & Roth P.C. has provided superior representation on a wide range of federal employment law issues, from representing federal employees nationwide in administrative investigations, disciplinary and performance actions, and Bivens lawsuits, to handling security clearance adjudications and employment discrimination cases.