Ninth Circuit: DOJ Appeals Federal Probationary Employment Records Order

• The Department of Justice is appealing a lower court order that mandates federal agencies correct the employment records of thousands of fired probationary employees.
• The government argues the federal court lacked jurisdiction, contending that the Civil Service Reform Act channels such "federal personnel action" claims to administrative bodies like the Merit Systems Protection Board.
• A San Francisco federal judge had previously ruled that the Office of Personnel Management's mass firings of probationary employees were likely illegal and violated the Administrative Procedures Act.
• While the judge did not order reinstatement, he directed agencies to update records to state terminations were not performance-based and issue corrective notices.
• The Ninth Circuit appeal will clarify the scope of judicial review for federal employment decisions and the rights of probationary federal employees under the Civil Service Reform Act.

The court's decision will clarify the boundaries between administrative remedies, as outlined by the Civil Service Reform Act, and the jurisdiction of federal courts in adjudicating disputes involving federal employees, particularly those in probationary status.

The legal battle over the rights of federal probationary employees has reached the Ninth Circuit Court of Appeals, where the Department of Justice is challenging a lower court's directive to correct thousands of employment records. This complex case originated when the Office of Personnel Management (OPM) issued an order to federal agencies, instructing them to terminate all probationary employees. These mass firings were ostensibly based on poor job performance, a claim later disputed by a coalition of unions, non-profit organizations, and the state of Washington, who filed a lawsuit against the federal government in February.

Senior U.S. District Judge William Alsup initially intervened, granting the plaintiffs a temporary restraining order. He determined that the OPM's mass firings were likely illegal, asserting that the OPM lacked the authority to compel agencies to hire or fire personnel, and could only offer guidance. Judge Alsup noted that the government's defense, characterizing OPM's actions as mere guidance, could easily be perceived by agencies as a direct order. The dispute briefly escalated to the Supreme Court, which issued an emergency stay, pausing Judge Alsup's order for the reinstatement of the terminated probationary federal employees. However, upon its return to Judge Alsup's San Francisco courtroom in April, he reaffirmed that the affected federal probationary employees retained standing in the case, despite the Supreme Court's intervention. He subsequently issued a narrowed preliminary injunction, prohibiting the OPM from issuing any further directives to agencies to terminate their employees.

In a significant development last September, Judge Alsup partially granted the plaintiffs' motion for summary judgment. He definitively concluded that the OPM had exceeded its authority by ordering agencies to hire or fire employees, and that the terminations themselves violated the Administrative Procedures Act. Despite these findings, Judge Alsup opted not to mandate the reinstatement of the terminated workers, acknowledging that "too much water has now passed under the bridge" since the Supreme Court's stay, and many of the affected individuals had already secured new employment.

Instead of reinstatement, the judge issued a crucial order focusing on the employment records of those terminated. He instructed federal agencies to update the files of the fired employees to clearly indicate that their terminations were not based on performance or conduct. Furthermore, he mandated the issuance of corrective notices to these employees, explicitly stating that they "were not terminated on the basis of your personal performance." This specific directive, aimed at rectifying the official narrative surrounding the OPM mass firings legality, is now at the heart of the government's appeal. The Department of Justice argues that this Judge Alsup employment records order inflicts ongoing injury, as agencies are compelled to affirm that terminations were not performance-based and are restricted from offering contradictory information to prospective employers.

The central argument presented by the Department of Justice to the Ninth Circuit panel is a challenge to the lower court's jurisdiction. Joshua Koppel, representing the government, contended that the San Francisco federal court lacked the authority to intervene in what constitutes a "federal personnel action." He asserted that the Civil Service Reform Act (CSRA) of 1978 establishes specific administrative channels for such claims, directing them to either the Federal Labor Relations Authority (FLRA) or the Merit Systems Protection Board (MSPB), rather than federal courts.

Koppel emphasized that the probationary federal employee rights are distinct from those of tenured federal workers under the 1978 law, implying a more limited scope for judicial review. He maintained that the legal framework provides a clear system for challenging personnel decisions, irrespective of whether the OPM's actions set a precedent for agency terminations. During the appellate hearing, U.S. Circuit Judge Morgan Christen questioned Koppel on whether his interpretation meant that unions or other interested parties would be entirely precluded from seeking declaratory judgment and prospective injunctive relief in federal court. Koppel affirmed this, stating that such a limitation is precisely what the CSRA scheme dictates. This jurisdictional dispute is a critical aspect of the Ninth Circuit federal probationary employment records appeal.

The outcome of this Ninth Circuit federal probationary employment records appeal carries significant weight for the landscape of federal employment law and the scope of federal personnel action judicial review. The court's decision will clarify the boundaries between administrative remedies, as outlined by the Civil Service Reform Act, and the jurisdiction of federal courts in adjudicating disputes involving federal employees, particularly those in probationary status. A ruling in favor of the government could reinforce the administrative channels as the primary, if not exclusive, avenue for challenging certain federal employment decisions, potentially limiting the ability of federal probationary employee rights to be addressed in federal courts.

Conversely, upholding Judge Alsup's orders could affirm a role for federal courts in ensuring the legality of broad agency directives, even when they pertain to personnel matters. The case also highlights the ongoing tension regarding the OPM's authority to issue binding orders versus mere guidance to other federal agencies. The resolution of this appeal will provide crucial guidance for both federal agencies and employees on the appropriate forums and procedures for addressing grievances related to federal personnel actions, especially concerning the correction of employment records following disputed terminations.

Lawyers advising federal employees or agencies must closely monitor the Ninth Circuit's ruling on this jurisdictional dispute, as it will clarify the proper channels for challenging federal employment decisions and the scope of judicial review versus administrative remedies under the Civil Service Reform Act, particularly for probationary workers and the correction of their employment records.

Source: Original reporting via Court News Service