A REPORT TO THE PRESIDENT AND THE CONGRESS OF THE UNITED STATES

BY THE U.S. MERIT SYSTEMS PROTECTION BOARD 

DECEMBER 2013

Clean Record

Settlement Agreements

and the Law

U.S. MERIT SYSTEMS PROTECTION BOARD

1615 M Street, NW

Washington, DC 20419-0001

The President

President of the Senate

Speaker of the House of Representatives

Dear Sirs:

In accordance with the requirements of 5 U.S.C. § 1204(a)(3), it is my honor to 

submit this U.S. Merit Systems Protection Board (MSPB) report, Clean Record Settlement 

Agreements and the Law. In the Federal civil service, a clean record agreement (CRA) is 

a contract between a Federal agency and a past or current employee in which the agency 

agrees to remove potentially negative information from the employee’s record in exchange 

for the resolution of employment-related claims against the agency. This report discusses the 

importance of agencies carefully choosing the language of CRAs and fully understanding the 

parties’ obligations—both explicit and implied.

MSPB—and its reviewing court—have often been presented with CRAs that fail to 

address important aspects of how the parties intend for the agreement to operate. Some Federal 

agencies appear to be unaware that, in the absence of specific language, the adjudicator may 

find implied obligations in many clean record agreements. An agency that fails to comply 

with these implied obligations may unintentionally breach a CRA. Such a breach can lead to 

both parties losing the benefits of the agreement, which means that if the agreement settled 

litigation, such litigation may resume and back pay with interest may apply.

The report also discusses how a CRA affects an agency’s ability to discuss an 

individual’s employment history with others, including officials conducting suitability or 

security clearance investigations for the Government or its contractors. For example, in the 

absence of criminal conduct, an explicit authorization in the agreement, or a specific waiver 

signed by the individual, an agency may be unable to disclose conduct or performance issues 

to an official conducting a security clearance investigation. 

I believe that you will find this report useful as you consider issues affecting the 

Federal Government’s ability to select and maintain a high-quality workforce.

Respectfully,

Susan Tsui Grundmann

A Report to the President and the Congress of the United States 

by the U.S. Merit Systems Protection Board

CLEAN RECORD 

SETTLEMENT AGREEMENTS

 AND THE LAW

U.S. Merit Systems Protection Board

Susan Tsui Grundmann, Chairman

Anne M. Wagner, Vice Chairman

Mark A. Robbins, Member

Office of Policy and Evaluation

Director

James M. Read

Deputy Director

James Tsugawa

Project Manager

Sharon Roth

Publication Production

Annette Butler

A Report by the U.S. Merit Systems Protection Board

TABLE OF CONTENTS

EXECUTIVE SUMMARY........................................................................................................... i

INTRODUCTION..................................................................................................................... 1

A BRIEF PRIMER ON MSPB SETTLEMENT LAW.................................................................... 5

“CLEANING” THE RECORD.................................................................................................... 9

Cleaning the Official Personnel File......................................................................................... 9

Broad OPF Cleaning Obligation..........................................................................................10

Narrowing the OPF Cleaning Obligation..........................................................................,...13

Cleaning Beyond the Official Personnel File..............................................................................13

Broad Cleaning Obligation Beyond the OPF.........................................................................13

Narrowing the Cleaning Obligation Beyond the OPF.............................................................16

DISCLOSING THE RECORD...................................................................................................19

What is Communicated...........................................................................................................19

Broad Obligation for Limited Communication.....................................................................19

Narrowing the Obligation to Limit Communications............................................................23

Who Does the Communicating................................................................................................27

Broad Agency Actors...........................................................................................................27

Narrowing Agency Actors....................................................................................................29

WAIVING CONFIDENTIALITY................................................................................................33

EXTERNAL RESTRICTIONS ON THE EFFECT OF A CRA.....................................................37

Public Policy Limitations.........................................................................................................37

Effects of CRA Provisions on Actions of Third Parties...............................................................42

Retirement Benefits and CRAs.............................................................................................43

OPM as Administrator of Retirement Benefits...........................................................................................43

Obligations Regarding Retirement Applications........................................................................................46

Office of the Inspector General............................................................................................50

Responses on OPM Forms about an Individual’s Background.....................................................51

CONCLUSION..........................................................................................................................57

APPENDIX A: METHODOLOGY DETAILS.............................................................................59

APPENDIX B: AGENCY REPRESENTATIVE SURVEY..............................................................61

APPENDIX C: LEGAL TERMINOLOGY...................................................................................67

APPENDIX D: ADDITIONAL INFORMATION ABOUT OFFICIAL PERSONNEL FILES........71

A Report by the U.S. Merit Systems Protection Board i

EXECUTIVE SUMMARY

More than two-thirds of adverse action appeals before the U.S. Merit Systems Protection 

Board (“MSPB” or “the Board”) in which the Board has jurisdiction are resolved by 

settlement agreements. Of those, more than half are clean record agreements (CRAs). The 

Board and its reviewing court, the U.S. Court of Appeals for the Federal Circuit (Federal 

Circuit), have addressed a variety of situations involving CRAs. An examination of the 

case law shows how nuances in the language of CRAs and the specific facts of the cases have 

brought about different results in seemingly similar situations. The case law also reveals the 

various consequences for parties that can arise from the breach of a CRA. 

Our goal in this report is to help parties to become more informed so that they may draft 

agreements that are valid, workable, and clearly express their intentions. This in turn will 

help the Board and its reviewing court to ensure that the parties receive the benefit of their 

bargain.

This report covers the following broad categories of issues:

• What items the CRA states or implies will be cleaned from a record.

• What systems of records the CRA states or implies will be cleaned.

• What obligations an agency has to support the record in communications with others.

• Which persons or entities are bound by the commitments made in the CRA.

• How entities, rules, and laws outside the agreement can affect the ability of parties to 

meet their obligations or benefit from the agreement as they intended. 

This report may be helpful in identifying cases and topics that should be addressed when 

negotiating and drafting CRAs but it is not a substitute for consulting the full content of 

Board and court opinions. 
ii Clean Record Settlement Agreeements and the Law
A Report by the U.S. Merit Systems Protection Board 1

INTRODUCTION

A majority of the adverse action cases filed with the U.S. Merit Systems Protection Board 

(“MSPB” or “the Board”)1 within its jurisdiction are resolved by a negotiated settlement 

agreement (NSA).2 Ninety-five percent of surveyed agency representatives reported that 

they had entered into a settlement agreement in the preceding three years.3 Eighty-nine 

percent of those who used NSAs were involved in one or more NSAs with a clean record 

provision.4

For the purpose of this report, a clean record provision is a term in an NSA under which the 

agency is obligated to change, remove, or withhold potentially negative information about 

an individual in exchange for the resolution of employment-related claims against the 

agency. NSAs with clean record provisions will be referred to as clean record agreements 

(CRAs). 

From Fiscal Year 2007 to Fiscal Year 2011, more than half of the settlement agreements 

filed with the Board for actions taken under 5 C.F.R. §§ 432 or 752 included a clean record 

provision.5 In our 2012 survey of agency representatives involved in §§ 752 and 432 cases, 

3 out of every 10 respondents indicated that more than half of their settlement agreements 

included a clean record provision.6 Seventy-five percent of those who used CRAs reported 

that CRAs “are often the only way to get an appellant/employee to agree to settle.”7

1 The practice of the U.S. Merit Systems Protection Board is to refer to the agency as “MSPB” and the three-member 

Board as “the Board”. However, others often use these terms interchangeably when referring to the agency or its leadership. 

2 See U.S. Merit Systems Protection Board, Annual Report for Fiscal Year 2012, at 36 (68 percent of adverse action initial 

decisions with jurisdiction resulted in settlement); Annual Report for Fiscal Year 2011, at 28 (68 percent); Annual Report for Fiscal Year 

2010, at 26 (71 percent); Annual Report for Fiscal Year 2009, at 22 (65 percent). Annual reports are available at http://www.mspb.

gov/publicaffairs/annual.htm. 

3 See Appendix B, Question 1. For more on the survey, see Appendix A. As explained in Appendix A, the data discussed in 

this report excludes responses of don’t know or not applicable. 

4 See Appendix B, Question 2.

5 Data is from a questionnaire given to MSPB administrative judges. For more on the questionnaire, see Appendix A. 

6 See Appendix B, Question 2. 

7 See Appendix B, Question 5.
2 Clean Record Settlement Agreements And The Law

Introduction

However, CRAs may also be used to settle other types of cases, including individual right 

of action (IRA) appeals claiming retaliation for whistleblower activity.8 In addition to 

adjudicating adverse action appeals, whistleblower IRA appeals, and a variety of other types 

of cases, the Board adjudicates appeals of decisions by the Office of Personnel Management 

(OPM) regarding applications for retirement benefits.9 In such cases, CRAs may affect 

OPM’s processing of retirement applications.10

The Board’s reviewing court, the U.S. Court of Appeals for the Federal Circuit (Federal 

Circuit), has noted regarding CRAs that “[t]he Board has a difficult job sorting through 

some of these enforcement agreements, particularly those that are not well-drafted, but. . . 

it is the Board’s job to see to it that the parties receive that for which they bargained.”11

In response to our questionnaire for agency representatives, 28 percent of the representatives 

who had used CRAs reported that they strongly agreed that they considered themselves 

“knowledgeable about MSPB and court decisions regarding the interpretation of clean 

record agreements.”12 Only 41 percent strongly agreed that before recommending or 

signing a clean record agreement, they “perform additional research to determine how 

various clauses in that agreement may be interpreted by MSPB or courts.”13

The purpose of this report is to explain the state of the law regarding CRAs to aid parties 

in drafting agreements that will increase the potential that they will obtain from the Board 

and its reviewing court that for which they thought they had bargained. The goal is to 

highlight case law that may help parties to craft appropriate language and adhere to the 

agreements that they make, thereby promoting mutual understanding between the parties 

and avoiding subsequent litigation related to alleged breach. To this end, the report identifies several clean record-related issues that parties should consider addressing with specificity, using language tailored to avoid ambiguity and to reflect their intentions.

8 For more on whistleblower law before MSPB, see U.S. Merit Systems Protection Board, Whistleblower Protections for Federal 

Employees, available at www.mspb.gov/studies. See also Whistleblower Protection Enhancement Act of 2012, Pub. L. No. 112-199, 

126 Stat. 1465 (WPEA), available at http://www.gpo.gov/fdsys/pkg/PLAW-112publ199/content-detail.html. 

9 OPM’s initial decision on a request for benefits is not appealable, but the individual can ask OPM to reconsider that 

initial decision. U.S. Office of Personnel Management, CSRS/FERS Handbook, Ch. 3A2.1-1. OPM’s reconsideration decision 

is appealable to MSPB. Id.; see also Lewis v. Merit Systems Protection Board, 301 F.3d 1352, 1354 (Fed. Cir. 2002) (explaining that 5 

U.S.C. § 8347(d)(1) (CSRS) and 5 U.S.C. § 8461(e)(1) (FERS) authorize individuals whose rights or interests are affected by OPM 

decisions under CSRS or FERS to appeal those decisions to MSPB). 

10 See, e.g., Conant v. Office of Personnel Management, 255 F.3d 1371, 1376 (Fed. Cir. 2001) (the agency breached the agreement by 

releasing the original SF-50 to OPM).

11 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1372 (Fed. Cir. 1999). 

12 Another 60 percent considered themselves somewhat knowledgeable about MSPB and court decisions regarding the 

interpretation of clean record agreements. See Appendix B, Question 15.

13 Another 42 percent somewhat agreed that before recommending or signing a clean record agreement, they perform 

additional research to determine how various clauses in that agreement may be interpreted by MSPB or courts. See Appendix B, 

Question 17. 
A Report by the U.S. Merit Systems Protection Board 3

Introduction

This report presumes a level of familiarity with contract law and Federal human resources 

(HR) processes.14 The next chapter contains a brief primer on MPSB settlement law. For 

readers who are not familiar with contract law, Appendix C contains a discussion of some 

of the legal terminology used in this report.

The primary resource for this report is case law, but the report also includes and was 

informed by: questionnaires completed by MSPB administrative judges (AJs) regarding 

cases; a review of a sample of settlement agreements containing a clean record provision; 

a 2012 survey of agency representatives; a questionnaire for unions and management 

associations; interviews of appellant attorneys; and responses to a questionnaire that MSPB 

sent to the OPM. Additional information on our methodology can be found in Appendix 

A.

14 The U.S. Government Printing Office (GPO) instructs that the words “Federal” and “Government” are to be capitalized 

in Government documents. U.S. Government Printing Office Style Manual, at 3.19, available at http://www.gpo.gov/fdsys/pkg/

GPO-STYLEMANUAL-2008/pdf/GPO-STYLEMANUAL-2008.pdf. However, in decisions issued by the Board and the 

Federal Circuit, these words are often not capitalized. See e.g., King v. Department of the Navy, 130 F.3d 1031, 1033 (Fed. Cir. 1997) 

(using lowercase of “government”). As a result, throughout this report, capitalization of these words inside quotations may vary, 

but outside of quotations, the report comports with the GPO instructions.
4 Clean Record Settlement Agreements And The Law
A Report by the U.S. Merit Systems Protection Board 5

A BRIEF PRIMER ON MSPB 

SETTLEMENT LAW

A settlement agreement is a contract and the interpretation of its terms is a question of 

law.15 Under the general principles of settlement construction, the words of the agreement 

itself are of paramount importance.16 In construing the terms of a settlement agreement, 

the Board examines the four corners of the agreement to determine the parties’ intent.17

Extrinsic evidence of intent will be considered only if the terms of the agreement are 

ambiguous. A contract is ambiguous when it is susceptible to differing yet reasonable 

interpretations.18 Additionally, the contract provisions will be read as part of an organic 

whole, giving reasonable meaning to all of the contract’s terms in order to identify and give 

weight to the spirit of the contract as intended by the parties.19

Oral settlement agreements are valid before MSPB and the same requirements apply to 

oral settlements that apply to written settlements.20 This includes that the terms must 

be memorialized for the record.21 Agreements may be memorialized without being fully 

reduced to a written and signed document.22 While parties may find it challenging to 

15 Greco v. Department of the Army, 852 F.2d 558, 560 (Fed. Cir. 1988); McGriff v. Department of the Navy, 118 M.S.P.R. 89, ¶ 20 

(2012). 

16 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶ 5 (2011). 

17 King v. Department of the Navy, 130 F.3d 1031, 1033 (Fed. Cir. 1997); Felch v. Department of the Navy, 112 M.S.P.R. 145 (2009); 

Wells v. Department of the Treasury, 89 M.S.P.R. 228, ¶ 7 (2001).

18 Mital v. Department of Agriculture, 116 M.S.P.R. 589, ¶ 6 (2011); Sweet v. U.S. Postal Service, 89 M.S.P.R. 28, ¶ 9 (2001). 

19 Young v. U.S. Postal Service, 113 M.S.P.R. 609, ¶ 15 (2010); see Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659 (2009), 

aff’d, 420 F. App’x. 980 (Fed. Cir. 2011). 

20 See Parks v. U.S. Postal Service, 113 M.S.P.R. 60, ¶ 11 (2010); Brown v. Department of the Navy, 60 M.S.P.R. 461, 462-63 (1994).

21 Parks v. U.S. Postal Service, 113 M.S.P.R. 60, ¶ 11 (2010). See Tiburzi v. Department of Justice, 269 F.3d 1346 (Fed. Cir. 2001) (if 

“no written agreement is forthcoming, the oral agreement still governs”); but see Mahboob v. Department of the Navy, 928 F.2d 1126, 

1130 (Fed. Cir. 1991) (the parties oral negotiations did not constitute a contract because they did not intend for it to be binding 

until it was reduced to writing).

22 See Gill v. Department of Veterans Affairs, 85 M.S.P.R. 541, ¶ 4 (2000) (methods for memorialization can include verbatim 

transcripts of the agreed upon terms or a tape recording); Brown v. Department of the Navy, 60 M.S.P.R. 461, 462-63 (1994) (the 

memorialization does not have to be in writing).
6 Clean Record Settlement Agreements And The Law

A Brief Primer on MSPB SEttlement Law

enforce the terms of an agreement if the memorialization is flawed,23 it is well-settled “that 

if no written agreement is forthcoming, the oral agreement still governs.”24

Before accepting a settlement agreement into the record for enforcement purposes, the 

Board must determine whether the agreement is lawful on its face, whether the parties 

freely entered into it, and whether the subject matter of this appeal is within the Board’s 

jurisdiction.25 

An appellant’s waiver of appeal rights in a settlement agreement is enforceable and not 

against public policy if the terms of the waiver are comprehensive, freely made, and fair, 

and the execution of the waiver was not the result of duress or bad faith on the part of the 

agency.26

In cases involving disclosures of information that purportedly violate the terms of a 

settlement agreement, the Board has consistently found that an appellant need not show 

actual harm, such as a failure to obtain a position or other form of monetary loss, in order 

to establish that a nondisclosure provision has been materially breached.27

The Board has broad authority to enforce the terms of a settlement agreement entered into 

the record.28 If a party believes that the other party has breached a settlement agreement 

that is under MPSB’s jurisdiction, the aggrieved party may file a petition for enforcement 

(PFE) (also known as a compliance action) with MSPB.29 The PFE is filed with the field 

23 See, e.g., Neal v. Department of Justice, 65 M.S.P.R. 207 (1994). In Neal, the parties reached an oral settlement agreement 

and the appeal was dismissed as settled. Id. at 211. Subsequently, efforts to reduce the oral agreement to writing failed and the 

appellant filed a petition for enforcement (PFE). Id. The parties orally settled again, the appeal was dismissed, and then the 

parties once again failed to reduce the agreement to writing. Id. The parties had recorded the second oral agreement, but the 

recording was inaudible. Id. The appellant filed a second PFE, which led to a third oral agreement, which in turn led to a third 

PFE when the parties could not agree on its content. Id. The third PFE was resolved when the parties finally created a written 

settlement agreement. Id. at 211-13. The appellant then sued for attorney fees and was found to be the prevailing party entitled 

to reasonable attorney fees for one of the PFEs. Id. 

24 Tiburzi v. Department of Justice, 269 F.3d 1346, 1352 (Fed. Cir. 2001); but see Mahboob v. Department of the Navy, 928 F.2d 1126, 

1130 (Fed. Cir. 1991) (the parties’ oral negotiations did not constitute a contract because they did not intend for it to be binding 

until it was reduced to writing).

25 Groeser v. Department of the Army, 114 M.S.P.R. 118, ¶ 4 (2010); see McCarter v. Department of the Navy, 114 M.S.P.R. 599, 

¶ 11 (2010). See also Mansfield v. National Mediation Board, 103 M.S.P.R. 237, ¶ 21 (2006) (in which the Board declined to accept a 

settlement agreement in which it was “plain that the parties [were] attempting to misuse [a Government] program for a purpose 

for which it was not intended” resulting in “a combination of pay and benefits not authorized by law”); Adkins v. U.S. Postal 

Service, 86 M.S.P.R. 671 ¶ 10 (2000) (finding it was error for the administrative judge to have accepted an NSA into the record 

for enforcement without first determining whether the underlying appeal was within the Board’s jurisdiction, and that the NSA 

must therefore be set aside and the initial decision that dismissed the appeal be vacated).

26 Simmons v. Small Business Administration, 108 M.S.P.R. 325, ¶ 6 (2011); Lawrence v. Office of Personnel Management, 108 M.S.P.R. 

325, ¶ 6, aff’d, 318 F. App’x 895 (Fed. Cir. 2008); Wyatt v. U.S. Postal Service, 101 M.S.P.R. 28, ¶ 18 (2006). 

27 Young v. U.S. Postal Service, 117 M.S.P.R. 211, ¶ 17 (2012); see Doe v. Department of the Army, 116 M.S.P.R. 160, ¶ 10 (2011); 

Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶¶ 15-17 (2009).

28 Littlejohn v. Department of the Air Force, 69 M.S.P.R. 59, 61 (1995).

29 5 C.F.R. § 1201.182(a).
A Report by the U.S. Merit Systems Protection Board 7

A Brief Primer on MSPB Setlement LAw

or regional office that handled the earlier action.30 The allegedly noncomplying party then 

must file either: (1) evidence of full compliance; (2) evidence of partial compliance with a 

statement regarding what remains to be done and what the party is doing about it; or (3) a 

statement showing good cause for a failure to completely meet its obligations.31 A hearing 

may be held if the administrative judge determines it is necessary.32 The administrative 

judge then will issue an initial decision which will be subject to the petition for review 

(PFR) and judicial review processes if a party seeks higher review.33

When one party materially breaches a Board-enforceable settlement agreement, the other 

party is entitled either to enforce the settlement agreement or to rescind it and reinstate the 

underlying action.34 If a breach of a NSA results in a lost job opportunity, the Board lacks 

authority to grant damages for wages the appellant may have earned with the prospective 

employer.35 

The choice of seeking enforcement or rescission of a settlement agreement belongs to the 

non-breaching party and the breaching party does not have the right to select the remedy.36

If the agreement is rescinded, the settlement terms become inoperative, and the parties are 

essentially restored to the status quo ante.

37 Rescission must be total as there is no remedy 

of partial rescission or partial enforcement.38 Therefore, if back pay is ordered, the Board 

will not limit such payment to the period from the breach forward. Rather cover the entire 

period in which pay would have been received—which can be several years or more.39

30 5 C.F.R. § 1201.182. A PFE for a settlement agreement reached under the Board’s original jurisdiction is filed with the 

Clerk of the Board. Id. 

31 5 C.F.R. § 1201.183(a)(1). 

32 5 C.F.R. § 1201.183(a)(3). 

33 5 C.F.R. § 1201.183(a)(4)-(6).

34 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶¶ 11-12 (2011); Eagleheart v. U.S. Postal Service, 113 M.S.P.R. 89, ¶ 16 (2009). 

The Board has noted that breaches of a non-disclosure provision cannot be fully cured. Littlejohn v. Department of the Air Force, 69 

M.S.P.R. 59, 62 (1995). 

35 Cardoza v. Department of Justice, 53 M.S.P.R. 264, 267 (1992); Miller v. Department of Health & Human Services, 41 M.S.P.R. 385, 

392 (1989). For more on the meaning of the word breach, see Appendix C: Legal Terminolog y. 

36 Lutz v. U.S. Postal Service, 108 M.S.P.R. 695, ¶ 11 (2008). 

37 Eagleheart v. U.S. Postal Service, 113 M.S.P.R. 89, ¶ 16 (2009).

38 Poett v. Department of Agriculture, 98 M.S.P.R. 628, ¶ 20, n.3 (2005); see Capps v. Department of Agriculture, 97 M.S.P.R. 381, 

¶ 20 (2004).

39 See Poett v. Department of Agriculture, 98 M.S.P.R. 628, ¶¶ 20-21, n.3 (2005) (rejecting the agency’s argument that it should 

only pay for the period from the breach forward and instead ordering back pay for a period of approximately 10 years). 
8 Clean Record Settlement Agreements And The Law
A Report by the U.S. Merit Systems Protection Board 9

“CLEANING” THE RECORD

As the Federal Circuit has explained, “[w]hen an employee voluntarily resigns in exchange 

for purging of the records that show the prior adverse action, the employee’s goal, to which 

the agency has agreed, is to eliminate this information as it may affect future employment 

with the government or elsewhere.”40 The cases below discuss the extent to which an 

agency may be required to purge those records to eliminate negative information and the 

circumstances under which that obligation may be broadened or limited by the terms in 

the CRA. 

CLEANING THE OFFICIAL PERSONNEL FILE

The Official Personnel File (OPF) is a single personnel folder that documents all Federal 

civilian service for a particular individual.41 A notification of personnel action (SF-50) 

is put into the OPF for all appointments and separations (as well as many other types of 

personnel actions).42 OPFs are a system of records subject to both the Privacy Act and the 

Freedom of Information Act (FOIA).43 “Agencies are authorized to respond to requests for 

information from the public on all Official Personnel Folders[.]”44

40 King v. Department of the Navy, 130 F.3d 1031, 1033 (Fed. Cir. 1997).

41 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping (Jun. 1, 2011), at Ch. 2-1 available at www.opm.

gov/feddata/recguide2011.pdf. OPM is the official owner of the system of records containing notifications of personnel action 

and OPM’s term to describe it is the “Official Personnel Folder.” 5 C.F.R. § 293.303. However, it is the practice of the Board to 

refer to such records as the “Official Personnel File.” For the sake of consistency with the cases being discussed in this report, 

the term Official Personnel File may be used in this report. Both terms are abbreviated as OPF and refer to the same system of 

records used to maintain notifications of personnel action. 

42 Office of Personnel Management, Guide to Processing Personnel Actions, at Ch. 1-4, 1-5, available at www.opm.gov/feddata/

gppa/gppa.asp. 

43 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at Ch. 6-4. “Requests from the public for 

information from personnel and medical folders must be handled in compliance with both the Privacy Act of 1974, as amended 

(5 U.S.C. 552a) and the Freedom of Information Act (5 U.S.C 552). The Privacy Act restricts access to records in a system 

of records. The Freedom of Information Act establishes the public’s right to information contained in Government records. 

Agencies are authorized to respond to requests for information from the public on all Official Personnel Folders and Employee 

Medical Folders in their possession.” Id. 

44 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at Ch. 6-4. See King v. Department of the Navy, 130 

F.3d 1031, 1033 (Fed. Cir. 1997) (the appellant learned of the agency’s non-compliance with a CRA through a FOIA request for 

her records).
10 Clean Record Settlement Agreements And The Law

"Cleaning" the Record

An OPF is retained for 65 years from the date of the individual’s last separation from Federal 

employment.

45 Thus, if an individual separates from the civil service at age 18, the OPF will 

be retained until the individual reaches the age of 83.

When an individual transfers to a new job within the executive branch, the OPF is 

transferred to the new employer.46 Typically, the new agency sends the new appointment 

SF-50 to the old agency with a request for the OPF.47 Under OPM policies, the OPF 

should be sent to the new employer within 5 working days after the old agency receives a 

request for the OPF.48

As shown in several cases in this report, in order to avoid breach, agencies that enter into 

CRAs should account for the longevity of OPFs and the extent to which the documents 

in the OPF are retained.

Broad OPF Cleaning Obligation

A seminal case for the issue of cleaning OPFs is Conant v. Office of Personnel Management.49

In Conant, an employing agency stipulated in a settlement agreement that it would 

“rescind” an individual’s removal SF-50 and issue a new SF-50 stating that the individual 

resigned for personal reasons.50 The Federal Circuit found that, by agreeing to “rescind” 

the removal SF-50, the agency had promised to erase the removal and all reasons for the 

removal from the agency’s records.51 The court determined that by agreeing to issue a new 

SF-50 in its place, the agency had promised that the only document in its records regarding 

the end of the individual’s employment with the agency would be the SF-50 stating that 

45 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at Ch. 7-1. When not in the possession of an 

agency, these records are stored by the National Archives and Records Administration, National Personnel Records Center. Id. 

46 This rule applies when the individual transfers within his or her agency, or transfers to another agency operating under 

OPM’s recordkeeping authority (which is most of the executive branch). U.S. Office of Personnel Management, Guide to Personnel 

Recordkeeping, at Ch. 7-2, 7-4. Employers who are outside OPM’s recordkeeping authority and do not transfer folders should receive 

a “transcript of service rather than a folder[.]” Id. at 7-4. However, some non-executive entities do receive the OPF, such as the 

U.S. Senate. Id. 

47 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at Ch. 7-2. 

48 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at Ch. 7-2. 

49 Conant v. Office of Personnel Management, 255 F.3d 1371 (Fed. Cir. 2001).

50 Conant v. Office of Personnel Management, 255 F.3d 1371, 1373 (Fed. Cir. 2001). The Conant case is also pertinent for 

issues related to CRA provisions that may conflict with obligations that an agency cannot contractually waive. To avoid 

repetitiousness, the specific facts surrounding the terms of the Conant agreement and the reasons why the agency shared the 

initial SF-50 with the agency will be discussed as a part of the chapter titled External Restrictions on the Effect of a CRA.

51 Conant v. Office of Personnel Management, 255 F.3d 1371, 1376 (Fed. Cir. 2001).
A Report by the U.S. Merit Systems Protection Board 11

"Cleaning" the Record

the individual had resigned for personal reasons.52 When the agency later provided a 

copy of the original SF-50 to OPM as a part of retirement proceedings, the agency was in 

material breach of the agreement.53

In Kitt v. Department of the Navy, the Board explained what it means to “clean” a record 

in light of Conant.54 In Kitt, the parties agreed that the appellant’s removal would be 

mitigated to a 30-day suspension.55 The terminology used in the CRA was that the agency 

would “change the nature” of the employee’s SF-50.56 The agreement did not explicitly 

promise to expunge all mention of the removal action from the OPF, and it made no 

mention of other recordkeeping systems.57

The Board discussed Conant at length and noted that the word “change” means “to replace 

with another.”58 The Board found that when the Navy agreed to “change” the nature of 

the action on the SF-50 from a removal to a suspension, and provided no express language 

permitting other disclosures of the removal, it was agreeing to remove any record of the 

appellant’s removal from the OPF.59 

The Board also noted that this holding was consistent with OPM’s Guide to Processing 

Personnel Actions, which instructs agencies that when they substitute a new personnel 

action for the original action, the agency shall “remove from the OPF the personnel action 

(SF-50) being cancelled.”60 Thus, under OPM’s regulations, to change meant to cancel 

and to cancel meant that the agency had the implied obligation to remove the original 

SF-50 from the OPF.61

52 Conant v. Office of Personnel Management, 255 F.3d 1371, 1376 (Fed. Cir. 2001). In Principe v. U.S. Postal Service, 100 M.S.P.R. 

66 (2005), the Board noted that, on first glance, Conant appears to be at odds with the general principles of settlement 

construction that silence as to a matter does not mean the agreement is ambiguous and that the Board will not imply a term into 

an agreement that is unambiguous. Id. ¶ 7. However, the Board noted that any reservations it might entertain about Conant are 

beside the point, because the Board is bound by the decisions of the Federal Circuit. Id.

53 Conant v. Office of Personnel Management, 255 F.3d 1371, 1376 (Fed. Cir. 2001).

54 See Kitt v. Department of the Navy, 116 M.S.P.R. 680 (2011).

55 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶ 2 (2011).

56 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶ 9 (2011).

57 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶ 9 (2011).

58 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶ 9 (2011); see Webster’s Ninth New Collegiate Dictionary 225 (9th ed. 

1985). 

59 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶ 9 (2011).

60 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶ 9 (2011); see Office of Personnel Management, Guide to Processing Personnel 

Actions, at Ch. 32-6. 

61 Kitt v. Department of the Navy, 116 M.S.P.R. 680, ¶¶ 9-10 (2011). The Board noted that the term at issue in Conant was 

“rescind” and that the dictionary definition of rescind includes to “cancel”. Id. at ¶ 8.
12 Clean Record Settlement Agreements And The Law

"Cleaning" the Record

This cleaning of OPFs has been read into agreements even when there has been no reference 

to SF-50s or an OPF.62 In Wells v. Department of the Treasury, the appellant was terminated 

from the agency during his probationary period for a negative suitability determination.63

The parties resolved the matter with an NSA in which the agency agreed to cancel the 

negative suitability determination and document that three training classes had been 

completed.64 In exchange, the appellant agreed not to “reapply” for employment with the 

agency.65 The Board found that the agreement did not explicitly address the employee’s 

status following the agreement, but that, since the NSA stated the appellant would not 

apply to work for the agency, some manner of separation was clearly intended.66

The “common sense” interpretation that the Board gave to the CRA was that the parties 

must have intended for the OPF to reflect that the appellant resigned, as any other separation 

would not afford the appellant with the benefit that he clearly sought from the cancellation 

of the negative suitability determination and the issuance of training documentation.67

Thus, when the agency failed to cancel the removal and issue an updated SF-50, the agency 

materially breached the CRA and the appellant was offered the opportunity to rescind the 

agreement.68

As noted earlier, OPFs are maintained for 65 years after an employee’s separation from 

the civil service.69 If an agency fails to clean the OPF in accordance with the terms of an 

agreement, it may be years before the individual learns of the breach.70 Yet, the agency 

may still be held liable for the breach if the appellant files a timely PFE upon learning of 

the problem.71

62 See Wells v. Department of the Treasury, 89 M.S.P.R. 228 (2001).

63 Wells v. Department of the Treasury, 89 M.S.P.R. 228, ¶ 2 (2001).

64 Wells v. Department of the Treasury, 89 M.S.P.R. 228, ¶ 8 (2001).

65 Wells v. Department of the Treasury, 89 M.S.P.R. 228, ¶ 8 (2001).

66 Wells v. Department of the Treasury, 89 M.S.P.R. 228, ¶ 9 (2001).

67 Wells v. Department of the Treasury, 89 M.S.P.R. 228, ¶¶ 14-16 (2001).

68 Wells v. Department of the Treasury, 89 M.S.P.R. 228, ¶¶ 15, 18-19 (2001).

69 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at Ch. 7-1. 

70 See, e.g., Eagleheart v. U.S. Postal Service, 113 M.S.P.R. 89, ¶¶ 3, 8, 14 (2009) (the agency breached the agreement when the 

appellant discovered in 2008 that the agency had failed to modify his OPF in accordance with a 2005 clean record settlement 

agreement).

71 A petition for enforcement alleging a breach of a settlement agreement must be filed within a reasonable time after the 

petitioner becomes aware of the breach. Kasarsky v. Merit Systems Protection Board, 296 F.3d 1331, 1335 (Fed. Cir. 2002); Eagleheart 

v. U.S. Postal Service, 113 M.S.P.R. 89, ¶ 12 (2009).
A Report by the U.S. Merit Systems Protection Board 13

"Cleaning" the Record

Narrowing the OPF Cleaning Obligation

Despite the cases above, OPFs can contain negative information after the parties agree to 

a CRA if the parties explicitly agree that the OPF may contain negative information.72

For example, in Lowe v. Department of Veterans Affairs, the parties agreed that “the agency 

would “[a]mend the Official Personnel Action (SF-50) dated May 19, 1995, to read “Resignation (ILIA-In Lieu of Impending Action) and remove the Official Personnel Action 

(SF-50) dated May 19, 1995, Removal, from the Official Personnel Folder.”73 The NSA 

also explicitly stated that “[i]n the remarks area of the Official Personnel Action, Resignation (SF-50) it will reflect that the resignation was a settlement offer to Ms. Lowe by the 

agency during the pendency of Ms. Lowe’s MSPB appeal of her removal.74 

The appellant later filed a PFR asserting, among other things, that the remarks on the 

OPF’s SF-50 referring to the proposed removal were negative and therefore needed to 

be deleted.75 The Board found that the SF-50 used the “precise language” that had been 

agreed upon, and therefore the mention of a proposed removal action did not constitute a 

breach of the agreement.76

CLEANING BEYOND THE OFFICIAL PERSONNEL FILE

Personnel information can exist in systems of records other than the OPF.77 While the 

cases above demonstrate the extent to which CRAs can bind agencies to clean the OPF or 

release them from that obligation, the cases below illustrate the extent to which agencies 

may be bound or released from the obligation to clean other records as well. 

Broad Cleaning Obligation Beyond the OPF 

In addition to maintaining an OPF for notifications of personnel actions, agencies are 

responsible for maintaining other systems of records containing information about 

an employee. For example, an agency must maintain performance-related forms in an 

Employee Performance File (EPF).78 Such a file contains appraisals, performance-related 

training information, individual development plans, and other documents.79 The terms of 

a CRA may require agencies to modify the EPF.80

72 See Lowe v. Department of Veterans Affairs, 85 M.S.P.R. 219, ¶¶ 3, 9 (2000) (permitting negative information in the OPF). 

73 Lowe v. Department of Veterans Affairs, 85 M.S.P.R. 219, ¶¶ 3-4 (2000).

74 Lowe v. Department of Veterans Affairs, 85 M.S.P.R. 219, ¶ 4 (2000).

75 Lowe v. Department of Veterans Affairs, 85 M.S.P.R. 219, ¶ 6 (2000).

76 Lowe v. Department of Veterans Affairs, 85 M.S.P.R. 219, ¶ 6 (2000). In Appendix D: Additional Information About Official 

Personnel Files, we discuss other rules about what can and what cannot be in an OPF.

77 See, e.g., 5 C.F.R. § 293.403 (employee performance files); 5 C.F.R. § 293.505 (employee medical files).

78 Compare 5 C.F.R. § 293.302 with 5 C.F.R. § 293.403 (EPFs).

79 5 C.F.R. § 293.403.

80 See Fernandez v. Department of Justice, 84 M.S.P.R. 666, ¶ 5 (2000). 
14 Clean Record Settlement Agreements And The Law

"Cleaning" the Record

In Fernandez v. Department of Justice, the agency had agreed to expunge an appellant’s 

personnel and disciplinary action files with respect to a demotion based on performance 

by removing the proposal and decision letters and all other information relating to the 

underlying demotion.81 The appellant filed several enforcement petitions, arguing that the 

agency had failed to comply with the settlement agreement because it had not expunged 

all information relating to the demotion from its records.82 

The agency repeatedly maintained that it had complied by purging her OPF.83 The agency 

claimed that it did not remove the appraisal at issue from the EPF because the agency 

believed that OPM regulations required the retention of her last three performance ratings 

in connection with reduction in force (RIF) procedures.84

The Board found that the agency’s “performance file” was a subset of the performance 

record system, and was therefore a personnel record.85 Accordingly, the agency was found 

in breach of the CRA because it had not removed the appraisal at issue from the appellant’s 

performance file.86

This obligation to clean—or at least attempt to clean—the record can extend to records 

not in the agency’s direct control.87 In King v. Department of the Navy, the Navy agreed 

to “cancel the removal action of the appellant. . . and remove all reference to the removal 

action from [the appellant’s] Official Personnel File.”88 In response to a FOIA request, the 

appellant was informed that both OPM and the Defense Finance and Accounting Service 

(DFAS) had records that contained references to the removal action.89 The appellant 

subsequently filed a PFR alleging breach of the CRA, even though the CRA made no 

mention of OPM or DFAS files.90

81 Fernandez v. Department of Justice, 84 M.S.P.R. 666, ¶¶ 2-3 (2000). 

82 Fernandez v. Department of Justice, 84 M.S.P.R. 666, ¶ 2 (2000). 

83 Fernandez v. Department of Justice, 84 M.S.P.R. 666, ¶ 2 (2000). 

84 Fernandez v. Department of Justice, 84 M.S.P.R. 666, ¶ 3 (2000); see 5 C.F.R. § 351.504(b)(1) (“[a]n employee’s entitlement to 

additional retention service credit for performance [in a reduction in force] shall be based on the employee’s three most recent 

ratings of record received during the 4-year period prior to the date of issuance of reduction in force notices.”) 

85 Fernandez v. Department of Justice, 84 M.S.P.R. 666, ¶ 5 (2000). 

86 Fernandez v. Department of Justice, 84 M.S.P.R. 666, ¶ 5 (2000). The Board also noted in dicta that in the event of a RIF, the 

removed appraisal would be treated as a “missing” appraisal – something that OPM regulations have a provision to address. Id. 

at ¶ 6; see 5 C.F.R. § 351.504(c). But see Baig v. Department of the Navy, 66 M.S.P.R. 269, 275 (1995) (even if a settlement agreement 

states that all references to an action must be expunged from its records, an agency is still permitted to retain pertinent 

documents in its litigation files).

87 See, e.g., King v. Department of the Navy, 130 F.3d 1031, 1033-34 (Fed. Cir. 1997).

88 King v. Department of the Navy, 130 F.3d 1031, 1033 (Fed. Cir. 1997).

89 King v. Department of the Navy, 130 F.3d 1031, 1033 (Fed. Cir. 1997).

90 King v. Department of the Navy, 130 F.3d 1031, 1033 (Fed. Cir. 1997).
A Report by the U.S. Merit Systems Protection Board 15

"Cleaning" the Record

The Federal Circuit found that “[i]t appears to be undisputed that the mutual intent was to 

purge the personnel records that are officially kept and thus might be available to a future 

employer; no other reasonable meaning has been proposed.”91 To limit the cleaning of the 

record to the OPF in the possession of the agency would deny the appellant the benefit of 

the agreement, which is to eliminate this information as it may affect future employment 

with the Government or elsewhere.92 The court found that it was “highly unlikely that 

the parties bargained for the purging of only local personnel records” while intending to 

permit the files at OPM and DFAS to hold the removed information.93 

While Fernandez applied the cleaning obligation to agency records other than the OPF, 

and King addressed Government records in the hands of other Federal agencies, in Phillips 

v. Department of Homeland Security, the Board was presented with a case in which the 

records were in the hands of a private sector company.94 

In Phillips, the parties resolved an appeal through an NSA in which the agency agreed that 

it would “[e]xpunge all documents related to Appellant’s removal from her Official Personnel [F]older. In the event anything else relating to the removal action should arise in any 

other files, it will likewise be destroyed.”95 The only exception was that the agency could 

maintain copies of the original documents in its litigation file in the legal and employee 

relations offices for possible use in “future litigation[.]”96

The Department of Homeland Security (DHS) employed a private sector contractor to 

communicate on its behalf with state unemployment offices.97 Prior to reaching the NSA, 

DHS gave the contractor records reflecting the appellant’s removal.98 The agency did not 

inform the contractor of the change in circumstances or ask the contractor to update its 

records.99 The contractor’s subsequent actions led to a PFE in which the appellant argued 

that DHS breached the NSA.100

91 King v. Department of the Navy, 130 F.3d 1031, 1034 (Fed. Cir. 1997).

92 King v. Department of the Navy, 130 F.3d 1031, 1033 (Fed. Cir. 1997).

93 King v. Department of the Navy, 130 F.3d 1031, 1034 (Fed. Cir. 1997). The court expressly stated that its decision did not 

reach the question as to whether the agency had the authority to enter into an agreement that would bind DFAS or OPM. Id. 

Rather, it noted that there had been no assertion that OPM or DFAS had received a request from Navy and then refused to 

comply with the settlement agreement. Id. For a discussion of the extent to which a contract may or may not bind third parties, 

see the subsection titled Effects of CRA Provisions on Actions of Third Parties in a later chapter of this report. 

94 See King v. Department of the Navy, 130 F.3d 1031, 1033-34 (Fed. Cir. 1997) (other agencies); Fernandez v. Department of Justice, 

84 M.S.P.R. 666, ¶ 5 (2000) (other systems of records); Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 13-14 (2012) 

(holding the agency accountable for failing to clean the records of its agent).

95 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 4 (2012). 

96 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 4 (2012). 

97 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 3 (2012). 

98 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 3 (2012). 

99 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 5 (2012). 

100 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 6-7 (2012). 
16 Clean Record Settlement Agreements And The Law

"Cleaning" the Record

The Board found that the CRA could have specified – but did not – that copies could be 

kept by other components, by agents of agency offices or components, or for reasons other 

than future litigation.101 Because the CRA’s limited provision regarding where the removal 

records could be kept did not include the contractor, the agency breached the agreement 

by not instructing the contractor to clean its records.102

Narrowing the Cleaning Obligation Beyond the OPF

While the cases above highlight how broad the obligation may be to clean the record, 

the obligation can be contractually narrowed by the terms of the CRA.103 In Knight v. 

Department of the Treasury, the agency agreed to remove from the appellant’s OPF the 

SF-50 documenting the appellant’s removal and instead insert an SF-50 indicating that 

the appellant had either resigned or retired.104 The CRA stated that “[e]xcept as expressly 

provided for in this Agreement, the Appellant waives any and all rights to seek . . . personnel 

records adjustment[s]” or “other remedies[.]”105 The appellant also agreed that he would 

neither seek nor accept employment with any “bureau, department or subagency” within 

the Department of the Treasury.106 As discussed in Appendix D, a “no return” clause of this 

kind is a fairly common CRA provision.107

Mr. Knight later applied for another position within the Department of the Treasury. When 

the agency investigated him in connection with his application, the agency reviewed its 

internal records. Through these records, the agency learned of his three prior suspensions, 

a report of investigation regarding alleged misconduct, and “the fact that he faced a removal 

action[.]”108 The appellant filed a PFE alleging that the settlement was intended to provide 

him with a clean record and the retention of these records breached the CRA.109

The Board denied the PFE, finding that the expungement provision was expressly limited 

to the OPF and that the CRA in Knight was distinguishable from other CRAs that the 

101 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 14 (2012).

102 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 14 (2012).

103 See Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶ 11 (2010).

104 Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶ 2 (2010).

105 Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶ 2 (2010).

106 Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶ 2 (2010). 

107 Prohibitions on future employment were present in more than 40 percent of the CRAs filed with MSPB to settle an 

initial appeal between FY 2007 and FY 2011. Eighty-four percent of the agency representatives who reported using CRAs 

said that they had included this term in one or more of their CRAs. Eighty-seven percent of agency representatives reported 

that when they decided to recommend or oppose a CRA, it was either very or somewhat important to them that they be able to 

prevent future employment with the office, agency or other identified employer(s). For more on the methodology by which this 

data was collected, see Appendix A. For a copy of the survey and its results, see Appendix B. 

108 Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶¶ 4-5, 14 (2010).

109 Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶ 4 (2010).
A Report by the U.S. Merit Systems Protection Board 17

"Cleaning" the Record

Board and the Federal Circuit had read more broadly, such as those discussed above.110

Because the OPF was the only system of records expressly named to be cleaned, and because 

the CRA stated that “[e]xcept as expressly provided for in this Agreement, the Appellant 

waives any and all rights to seek” adjustments to personnel records, the Board found that 

the appellant had “clearly and unambiguously” waived the cleaning of any other system of 

records.111

The outcomes of the cases in this chapter regarding records were a result of the distinguishing 

aspects of the CRAs and the specific actions of the agencies in the particular cases. The 

next chapter demonstrates the extent to which distinguishing characteristics in CRAs and 

agency actions can also determine whether a disclosure of the original history constitutes a 

breach of the CRA.

110 Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶ 11 (2010). In its decision, the Board recognized that both it and 

the Federal Circuit had construed CRAs that provide for rescission of the original removal SF-50s and issuance of new SF-50s as 

also requiring expungement of other removal-related documents from an employee’s OPF. Id. 

111 Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶ 11 (2010). One of our survey questions asked agency 

representatives what they had done that worked well and should be done by others. Several respondents recommended expressly 

limiting the cleaning obligation to the OPF. As one respondent put it: “I attempt to restrict clean record agreements to the OPF 

only. It is virtually impossible for an agency to remove all documentation of a personnel action. There is always a piece of paper 

or a misspoken employee. Agencies do their best to abide by agreements but a true clean record is difficult to achieve unless 

there are agreed parameters.”
18 Clean Record Settlement Agreements And The Law
A Report by the U.S. Merit Systems Protection Board 19

 DISCLOSING THE RECORD

When communicating with others, agencies that have entered into CRAs have an 

obligation to support the modified record and act as if the appellant’s history was, in fact, 

clean.112 The promise to clean the record automatically implies the promise to act as if the 

clean record is the only record.113 There are at least two important aspects of meeting this 

obligation: (1) what is being communicated; and (2) who is doing the communicating. 

Each of these aspects has an implied rule that is broad and each can be narrowed by the 

explicit terms of the agreement.

WHAT IS COMMUNICATED

An agency cannot explicitly or by implication signal that there is something odd about 

the appellant’s record.114 However, this obligation to support the modified record can be 

narrowed by the explicit language of the CRA.115 

Broad Obligation for Limited Communication 

In Pagan v. Department of Veterans Affairs (DVA), the parties reached a CRA resolving the 

applicant’s removal appeal.116 The agreement included that “[t]he appellant will receive 

a clean record. All charges and actions will be removed from the appellant’s personnel 

file.”117 There was also a clause in which the agency agreed “not to disclose the terms to 

any prospective employer.”118 However, “the agreement did not spell out the nature of the 

reference the DVA was to provide upon request from Mr. Pagan’s potential employers.”119

112 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1371-72 (Fed. Cir. 1999).

113 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1371-72 (Fed. Cir. 1999); Torres v. Department of Homeland Security, 110 

M.S.P.R. 482, ¶ 12 (2009).

114 See Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1372 (Fed. Cir. 1999) (explaining that by crossing out questions 

on a form, the agency signaled that something was off about the appellant).

115 See Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 23 (2009) (permitting a disclosure when language in the 

CRA authorized such disclosures).

116 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1370 (Fed. Cir. 1999).

117 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1370 (Fed. Cir. 1999).

118 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1370 (Fed. Cir. 1999).

119 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1371 (Fed. Cir. 1999).
20 Clean Record Settlement Agreements And The Law

Disclosing the Record

The appellant applied for a position with the U.S. Postal Service (USPS), which contacted 

the Department of Veterans Affairs (DVA) for references. In its decision, the Federal 

Circuit noted:

[T]hough the purpose of the settlement agreement was clear, exactly 

how to respond to the question: “Would you rehire this individual?” 

was less so. On the basis of a “clean record” in Mr. Pagan’s personnel 

file, [the agency official] could check “yes,” but on the basis of the facts 

as he knew them, to be honest he should check “no.”120

The agency official did not provide a yes or no answer, but stated he could not answer the 

question due to circumstances beyond his control.121 The agency was also asked to rate 

the appellant’s “attendance, work performance, behavior, and attitude using an excellent 

to unsatisfactory scale.”122 The agency official crossed out the whole scale and did not rate 

the appellant.123

The court found that “although the agency did not promise to provide a favorable reference, 

or even any reference at all, it was required to act, in matters relating to Mr. Pagan, as if 

he had a ‘clean record.’”124 The court found that returning the questionnaire with the 

questions about the appellant’s conduct and performance crossed out “would have strongly 

suggested to any recipient of the form that Mr. Pagan did not have a ‘clean record’ with the 

DVA.”125 Accordingly, the agency was found in breach of the CRA.126

While Pagan involved a CRA with a confidentiality clause, its principles apply even when 

there is no such clause.127 For example, in Torres v. Department of Homeland Security, 

the agency and the appellant entered into a CRA to resolve an appeal involving the 

appellant’s removal. The agreement stated that the agency would remove from the OPF 

all documentation regarding the appellant’s removal and replace the removal SF-50 with 

a resignation SF-50.128 According to the appellant, he then applied for a position with 

an American company to serve as a contractor in Iraq.129 He asserted that as part of the 

120 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1371 (Fed. Cir. 1999).

121 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1370 (Fed. Cir. 1999).

122 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1370 (Fed. Cir. 1999).

123 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1370 (Fed. Cir. 1999).

124 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1371-72 (Fed. Cir. 1999).

125 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1372 (Fed. Cir. 1999).

126 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1372 (Fed. Cir. 1999).

127 Torres v. Department of Homeland Security, 110 M.S.P.R. 482, ¶¶ 6, 12 (2009).

128 See Torres v. Department of Homeland Security, MSPB Docket No. DA-0752-07-0066-C-1, Initial Decision (Aug. 20, 2008), 

at 4. 

129 Torres v. Department of Homeland Security, MSPB Docket No. DA-0752-07-0066-C-1, Initial Decision (Aug. 20, 2008), at 5. 
A Report by the U.S. Merit Systems Protection Board 21

Disclosing the Record

company’s background investigation, he informed the company that he had never been 

fired for “payroll issues”.130 The appellant claimed that he later learned that several agency 

employees had told the investigator that the appellant had resigned in lieu of termination 

due to payroll issues.131

The appellant filed a PFE.132 The AJ found that even if the appellant’s allegations could be 

proven, there was no breach because “the agreement did not contain any confidentiality clause 

that would preclude agency employees from providing information to an investigator.”133 

On PFR, the Board reversed the initial decision.134 The Board found that the key concern 

in clean record cases is that the Board “see to it that the parties receive that for which they 

bargained.”135 For this to occur, the agreement must be construed as requiring that the 

agency’s communications with third parties reflect what the agreed upon record shows—

regardless of whether the CRA contained an explicit confidentiality clause.136 Because the 

agency agreed to a clean record, it was required to act as if the appellant had a clean record.137

Thus, if the agency disclosed the appellant’s alleged misconduct to the investigator, it was 

in breach of the CRA.138 

The Board recently decided an appeal that hinged on a similar issue, i.e., whether a general 

disclosure prohibition applies to intra-agency communications that are not necessary to 

carry out the terms of the agreement. In Shirley v. Department of the Interior, the parties 

settled a removal appeal with a CRA.139 The CRA provided in relevant part that:

The Parties, to the extent permitted by law, agree that the terms and 

conditions of this Agreement, including the identity of the Parties, and 

the facts surrounding the Agreement are to be deemed confidential and 

are not to be disclosed to anyone, with the exception of disclosure of the 

contents of the Agreement when required by law; disclosures made by 

the Appellant to his immediate family members; and disclosures made 

130 Torres v. Department of Homeland Security, MSPB Docket No. DA-0752-07-0066-C-1, Initial Decision (Aug. 20, 2008), at 5. 

131 Torres v. Department of Homeland Security, MSPB Docket No. DA-0752-07-0066-C-1, Initial Decision (Aug. 20, 2008), at 5. 

132 Torres v. Department of Homeland Security, 110 M.S.P.R. 482, ¶ 4 (2009). 

133 Torres v. Department of Homeland Security, MSPB Docket No. DA-0752-07-0066-C-1, Initial Decision (Aug. 20, 2008), at 8. 

134 Torres v. Department of Homeland Security, 110 M.S.P.R. 482, ¶ 11 (2009).

135 Torres v. Department of Homeland Security, 110 M.S.P.R. 482, ¶ 11 (2009) (citing Pagan v. Department of Veterans Affairs, 170 

F.3d 1368, 1372 (Fed. Cir. 1999)). 

136 Torres v. Department of Homeland Security, 110 M.S.P.R. 482, ¶ 12 (2009).

137 Torres v. Department of Homeland Security, 110 M.S.P.R. 482, ¶ 12 (2009).

138 Torres v. Department of Homeland Security, 110 M.S.P.R. 482, ¶ 12 (2009). On remand, the AJ was instructed to develop the 

record to determine if the alleged communications with the investigator had occurred. Id. at 13. 

139 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 8. 
22 Clean Record Settlement Agreements And The Law

Disclosing the Record

by the Parties for the limited purposes of implementing or enforcing the 

terms of this Agreement.140

The CRA did not prevent the appellant from reapplying for a new job the same agency.141

The appellant did so and accepted an appointment at a different agency office.142 Shortly 

after the appointment, however, the appellant’s new office contacted his former office 

to obtain the information necessary to effect a law enforcement commission for him.143

During the course of those discussions, the officials at the appellant’s new office learned of 

his removal, Board appeal, and settlement.144 The appellant filed a PFE, arguing among 

other things that the agency breached the nondisclosure provision of the CRA. 145

The Board found, however, that these intra-agency communications did not breach the 

CRA nondisclosure provision as written. Specifically, the “parties” to the agreement were 

the appellant and the agency—not any particular agency office or official.146 “As the term 

‘disclosure’ is ordinarily understood, a party cannot disclose information to itself, because 

any information the party could disclose is already in its possession.”147 Accordingly, the 

Board found that “[a]bsent clear indications to the contrary, we must infer that when 

‘[t]he Parties’ agreed that information about the agreement would not be disclosed to 

anyone, they committed themselves not to reveal such information to third parties.”148

The Board contrasted the general nondisclosure provision in Shirley with the more specific 

nondisclosure provision in Sena v. Department of Defense which explicitly restricted the 

intra-agency disclosures that could occur.149

140 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 8. 

141 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 9.

142 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 11. 

143 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 11.

144 Shirley v. Department of the Interior, 2013 MSPB 76, ¶¶ 12-25.

145 Shirley v. Department of the Interior, 2013 MSPB 76,¶ 15. The appellant also argued that the agency breached the clean 

record provision by not purging the adverse action-related documents from his law enforcement commission file. Id., ¶ 18. The 

Board disagreed, finding that the agency only agreed to remove such information from the appellant’s OPF, and that the clean 

record provision was similar to the one in Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659 (2009), discussed above. Shirley 

v. Department of the Interior, 2013 MSPB 76, ¶¶ 20-23

146 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 25.

147 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 25.

148 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 25.

149 Shirley v. Department of the Interior, 2013 MSPB 76, ¶ 27 (citing Sena v. Department of Defense, 66 M.S.P.R. 458 (1995)).
A Report by the U.S. Merit Systems Protection Board 23

Disclosing the Record

Narrowing the Obligation to Limit Communications

As with issues regarding cleaning the record, non-disclosure obligations can be narrowed 

by the terms of the agreement.150 In Godwin v. Department of Defense, the CRA stated that 

the appellant would “direct any potential future employers seeking an employment reference” to one of two specific people or their designees.151 These individuals would then, in 

response to any inquiry by future employers, “advise” the inquiring entity that the appellant “resigned from the agency for personal reasons, and that Appellant was rated at the 

highly successful level. No negative statement [would] be made.”152

One of the designated officials was contacted by a potential employer who sent a form 

containing 12 questions.153 The official “returned the form without filling it out, but she 

attached a cover letter stating that Ms. Godwin had ‘left for personal reasons’ and that 

she had ‘performed at a highly successful level.’”154 The official also “stated that she could 

not answer specific questions regarding Ms. Godwin.”155 In a separate incident, when 

contacted by a potential employer, the official stated that the appellant “met standards” 

for a variety of tasks but declined to answer other questions, including whether the agency 

would be willing to rehire the appellant.156

While the facts in Godwin are similar to those in Pagan, discussed earlier, slight differences 

in the facts and more substantial differences in the CRAs brought a different result.157 In 

Pagan, the CRA did not specify what the agency would say, and when asked about the 

appellant, the agency official drew lines through the questions on a form that asked about 

the appellant’s conduct and performance.158 The Federal Circuit found that by crossing 

out the questions, the agency had, in effect, “strongly suggested” that there was a problem 

with the appellant and thereby breached the agreement.159

150 Compare Knight v. Department of the Treasury, 113 M.S.P.R. 548, ¶ 11 (2010) (narrowing the obligation to clean the record) 

with Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659 (2009) (narrowing the obligation to support the record). 

151 Godwin v. Department of Defense, 228 F.3d 1332, 1334 (Fed. Cir. 2000).

152 Godwin v. Department of Defense, 228 F.3d 1332, 1334 (Fed. Cir. 2000).

153 Godwin v. Department of Defense, 228 F.3d 1332, 1335 (Fed. Cir. 2000).

154 Godwin v. Department of Defense, 228 F.3d 1332, 1335 (Fed. Cir. 2000).

155 Godwin v. Department of Defense, 228 F.3d 1332, 1335 (Fed. Cir. 2000).

156 Godwin v. Department of Defense, 228 F.3d 1332, 1336 (Fed. Cir. 2000).

157 Godwin v. Department of Defense, 228 F.3d 1332, 1336 (Fed. Cir. 2000) (discussing Pagan v. Department of Veterans Affairs, 170 

F.3d 1368, 1370-71 (Fed. Cir. 1999)).

158 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1370-71 (Fed. Cir. 1999).

159 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1372 (Fed. Cir. 1999).
24 Clean Record Settlement Agreements And The Law

Disclosing the Record

In Godwin, the Federal Circuit found that:

Upon being asked a question falling outside the specific areas covered 

by. . . the settlement agreement, as to which an honest answer would be 

negative, [the agency official] had three choices: to give a false favorable 

answer, thereby deceiving the inquirer; to give a truthful negative answer, 

thereby breaching the provision of the agreement prohibiting negative 

statements; or to decline to answer the question. In that situation, it 

was perfectly permissible for [the agency official] to choose the third 

option, thereby avoiding either lying or breaching an express term of the 

agreement. We decline to interpret the “negative statement” provision 

of the agreement to impose an affirmative obligation on [the agency 

official] to lie to any prospective employer if a truthful answer would be 

negative.160

The Federal Circuit emphasized its “discomfort” with agreements that pose such dilemmas, 

but stated that it would “construe such agreements strictly according to their terms” and 

would “not readily construe such an agreement to require an agency to deceive prospective 

employers.”161 It reiterated that it would “not assume that silence in response to particular 

inquiries necessarily constitutes a ‘negative comment’ on the employee’s performance.”162

The ability to make a disclosure can also be narrowed based on the circumstances 

surrounding the inquiry.163 In Allen v. Department of Veterans Affairs, the agency agreed 

to remove from the appellant’s OPF a suspension SF-50 and a removal SF-50.164 A 

resignation SF-50 would be inserted in their place.165 The agreement also stated that if 

the Human Resources Officer was “contacted for any employment inquiry or reference 

for the Appellant [the official] will. . . truthfully respond regarding those matters required 

by law.”166 The appellant then applied to the Office of Workers’ Compensation Programs 

(OWCP) for Federal benefits for an alleged workplace injury.167 

OWCP sent to the agency a request for information that included questions about whether 

the appellant had any conduct or performance problems during his employment.168 The 

160 Godwin v. Department of Defense, 228 F.3d 1332, 1337 (Fed. Cir. 2000).

161 Godwin v. Department of Defense, 228 F.3d 1332, 1338 (Fed. Cir. 2000).

162 Godwin v. Department of Defense, 228 F.3d 1332, 1338 (Fed. Cir. 2000).

163 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 23 (2009). 

164 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 2 (2009). 

165 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 2 (2009). 

166 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 2 (2009) (emphasis added). 

167 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 3 (2009). 

168 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 4 (2009). 
A Report by the U.S. Merit Systems Protection Board 25

Disclosing the Record

agency replied to OWCP with a narrative response and enclosed documents regarding 

the appellant’s disciplinary history, including copies of the proposal and decision notices 

from the rescinded removal action.169 The appellant then filed a PFE alleging that the 

information the agency sent to OWCP constituted a breach of the CRA.170

The Board noted the seeming applicability of Conant, in which the agency breached the 

CRA when it sent a rescinded SF-50 to OPM.171 However, the Board distinguished 

Allen from Conant because contract provisions must be read as part of an organic whole, 

according reasonable meaning to all of the contract terms and giving weight to the spirit or 

essence of the contract as intended by the parties.172 As explained above, the CRA in Allen, 

contained a clause permitting the agency to make disclosures when required by law.173 

The Board found that an employer is legally required to disclose to OWCP information 

that challenges an employee’s claim of entitlement to FECA benefits.174 The Board 

also analyzed the False Claims Act and found that if the responding agency official had 

willfully failed, neglected, or refused to make any of the reports, or knowingly filed a false 

statement or representation, or concealed any material facts, the official could be fined or 

imprisoned.175 The Board found that because of the agency’s legal obligations to OWCP, 

and the clause that permitted the making of disclosures required by law, the agency was 

not in breach of the CRA.176 

However, in Phillips v. Department of Homeland Security, a case using similar CRA language, 

an important difference in the facts of the case resulted in the opposite outcome for the 

agency when it disclosed the appellant’s history.177 In Phillips, discussed earlier for issues 

related to cleaning the record of an agency’s contractor, the CRA also had an exception for 

disclosures required by law.178 

In Phillips, the CRA included a provision that enabled the agency to discuss the original 

record if the appellant signed a waiver or applied for a “law enforcement officer position[,]” 

169 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 4 (2009). 

170 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 4 (2009); see Conant v. Office of Personnel Management, 255 F.3d 1371 

(Fed. Cir. 2001). 

171 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 16 (2009). 

172 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 16 (2009). 

173 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 2 (2009). 

174 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 21 (2009). 

175 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 21 (2009); see 31 U.S.C. § 3729 (False Claims Act). 

176 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659, ¶ 23 (2009). 

177 Compare Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 20, 23 (2012) with Allen v. Department of Veterans 

Affairs, 112 M.S.P.R. 659, ¶ 23 (2009).

178 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 17, 22-23 (2012). 
26 Clean Record Settlement Agreements And The Law

Disclosing the Record

but was otherwise unable to discuss the record except as “required by law, court order, 

or government regulation.”179 The agency’s private sector contractor later informed a 

Maryland state unemployment agency that the appellant had been removed.180 

Among several different defenses, the agency asserted that the disclosure did not breach 

the settlement agreement because the agreement contained an exception for disclosure 

of removal-related information when required by law.181 The agency claimed that both 

Board precedent (including the Allen case discussed above) and Maryland law required it 

“to truthfully respond to the Maryland Unemployment Division’s request for separation 

information about the Appellant.”182 

The Board distinguished the facts of Phillips from those in Allen.

183 In Phillips, the Board 

found that it was possible for the agency to comply with Maryland law without making 

the disclosure.184 Thus, the agency in Phillips had breached the CRA while the agency in 

Allen had not.185 

These cases, when looked at together, highlight an important point about the use of 

boilerplate language. Whatever language the parties agree to put into the contract, the 

contract will still be applied to the specific facts of the case at hand.186 It therefore behooves 

parties to tailor the language of their CRAs to accommodate the situation at hand and 

thereafter to conduct themselves in accordance with the situation where the settlement 

contract is operating.

187 

179 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 4 (2012). 

180 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 6 (2012). Prior to the settlement, the contractor had 

informed a Virginia unemployment agency about the removal. Id. at ¶ 3.

181 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 17 (2012). 

182 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 17 (2012). The agency also cited Felch v. Department of the 

Navy, 112 M.S.P.R. 145, ¶ 16 (2009), in which the Board found that if an agency with a CRA that permitted disclosures required 

by law was, in fact, required by law to disclose to a state unemployment office, then the agency would not be in breach of the 

CRA. In Felch, the Board remanded the case back to the AJ to determine, among other things, whether the law required a 

disclosure. Id. at ¶ 17. 

183 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶ 20 (2012). 

184 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 22-23 (2012). 

185 Compare Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 20, 23 (2012) with Allen v. Department of Veterans 

Affairs, 112 M.S.P.R. 659, ¶ 23 (2009).

186 Compare Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 20, 23 (2012) with Allen v. Department of Veterans 

Affairs, 112 M.S.P.R. 659, ¶ 23 (2009).

187 Compare Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 20, 23 (2012) with Allen v. Department of Veterans 

Affairs, 112 M.S.P.R. 659, ¶ 23 (2009).
A Report by the U.S. Merit Systems Protection Board 27

Disclosing the Record

WHO DOES THE COMMUNICATING

The question of whether or not the agency will be held accountable for the actions of an 

individual has been read quite broadly in the absence of narrowing language.188 However, 

as with the cases discussed previously, narrowing language can be an option. 

Broad Agency Actors

In Thomas v. Department of Housing and Urban Development, there was a CRA between the 

Department of Housing and Urban Development (HUD) and the appellant to resolve a 

demotion action.189 As a term of the agreement, the appellant resigned from the agency.190

The CRA stated that no agency employee could directly or indirectly refer to the demotion 

which had been predicated on an investigation into the appellant.191 The appellant later 

expressed interest in employment with the Department of Justice (DOJ), so a DOJ official 

called a friend at HUD to ask about the appellant.192 The HUD employee, who admitted 

that she did not know the appellant personally, spoke with another HUD employee to 

obtain information about the appellant and then passed on to her DOJ friend what the 

second HUD employee had told her.193 This information included that the appellant had 

been the subject of an investigation.194

When the case reached the Federal Circuit, the court opined that:

It may well be that it is virtually impossible for agencies to ensure 

that settlement agreements such as this, requiring the whitewashing 

of an employee’s disciplinary record, can be performed to the letter. 

Even if some agency officials are willing to palm off their problems on 

others, including sister agencies, without revealing the truth about an

188 Compare King v. Department of the Navy, 130 F.3d 1031, 1033-34 (Fed. Cir. 1997) (reading record cleaning obligations 

broadly) and Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1370 (Fed. Cir. 1999) (the agency breached the CRA by drawing 

lines through questions about the appellant because it sent a message that would make the recipient suspicious) with Phillips v. 

Department of Homeland Security, 118 M.S.P.R. 515, ¶ 14 (2012) (the agency was liable for the communications of its agent). 

189 Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1440 (1997).

190 Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1440 (1997).

191 Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1440-41 (1997).

192 Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1440 (1997).

193 Thomas v. Department of Housing and Urban Development, 71 M.S.P.R. 181, 188-89 (1996).

194 Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1440-42 (1997); Thomas v. Department of Housing and 

Urban Development, 71 M.S.P.R. 181, 188-89 (1996).
28 Clean Record Settlement Agreements And The Law

Disclosing the Record

employee, there is always the risk that another person who knows the 

facts will not remain silent.195

However, it also found that it could not “permit the agency that willingly entered into such 

an arrangement to breach it without being held responsible. To do so would be to condone 

what would be essentially an empty promise made by the government.”196 The court found 

in 1997 that the agency’s breach of the CRA permitted the appellant to withdraw his 1992 

resignation.197

Similarly in Powell v. Department of Commerce, the parties agreed that the agency 

would not discuss any aspect of the settlement agreement, or the incidents leading up 

to the agreement, with any other person or entity, except as necessary to implement the 

agreement or as ordered by a court or administrative body of competent jurisdiction.198

The agreement specified that employment-related inquiries would not be directed to the 

appellant’s Commerce supervisor, Mr. Levitt.199 The appellant filed an EEO complaint 

at her new agency, and the new agency proffered as a witness Mr. Levitt, who it stated 

would testify negatively about the appellant’s prior EEO activity and “abusive” treatment 

of coworkers at Commerce.200

The appellant filed a PFE alleging breach.201 In reply, Commerce did not dispute that the 

proffer occurred but “explained that Mr. Levitt was not familiar with all the terms of the 

agreement. The agency further stated that it had taken correctivemeasures immediately after 

the disclosure occurred.”202 These measures included informing the EEOC administrative 

judge that the proffered testimony was “unauthorized”.203 Commerce argued there had 

been no breach as Mr. Levitt did not actually testify, having been rejected as a witness by 

the EEOC.204 The Board found that by communicating the negative information to the 

new employer, Commerce had deprived the appellant of the “clean slate” that she had 

195 Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1442 (1997). While this case referred to the original 

history as “the truth,” we note that in Conant v. Office of Personnel Management, 255 F.3d 1371, 1377 (Fed. Cir. 2001), the Federal 

Circuit deemed it an “abuse of discretion” when the Board allegedly accepted as true allegations that the agency had not proven 

before a third party adjudicator because the case was settled. 

196 Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1442 (1997).

197 Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1441-43 (1997).

198 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶ 3 (2005). 

199 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶ 2 (2005).

200 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶ 5 (2005).

201 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶ 5 (2005).

202 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶ 6 (2005).

203 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶ 12 (2005).

204 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶ 12 (2005).
A Report by the U.S. Merit Systems Protection Board 29

Disclosing the Record

bargained for under the agreement.205 Thus, even though the employee that caused the 

breach may not have “been familiar with all the terms” of the CRA, his communications 

with the new employer constituted an incurable material breach.206

The obligation of the agency to avoid “the risk that another person who knows the facts will 

not remain silent” is not limited to the employees of the agency.207 In Phillips, discussed 

earlier, the agency breached its contractual obligations to the appellant through the actions 

of its contractor.208 The agency’s clean record obligations applied to not only the paper 

record in the contractor’s possession, but also to disclosures made by its contractor.209

Narrowing Agency Actors

The language of a CRA can narrow an agency’s obligation to control the speech of those 

under its control.210 In Godwin v. Department of Defense, discussed earlier, the CRA stated 

that the appellant would “direct any potential future employers seeking an employment 

reference” to one of two specific people or their designees.211 However, a prospective 

employer contacted the appellant’s supervisor, who was not one of the two individuals 

named.212 In response to questions from the prospective employer, the supervisor allegedly 

laughed and “took the 5th.”213 

The court found that the supervisor’s action was “troubling” but that, because he was not 

a designee of either of the two people indicated in the CRA as individuals to whom the 

appellant was to direct interested parties, he was not bound by the limits that had been 

placed on the speech of those two individuals.214

In order to provide sufficient protection to both parties, a point-of-contact provision must 

also be specific and complete. In Allison v. Department of Transportation, the CRA stated 

that requests “for employment references are to be directed only to: Human Resource [sic] 

205 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶ 13 (2005).

206 Powell v. Department of Commerce, 98 M.S.P.R. 398, ¶¶ 6, 13 (2005).

207 The quote is from Thomas v. Department of Housing and Urban Development, 124 F.3d 1439, 1442 (1997). See Phillips v. 

Department of Homeland Security, 118 M.S.P.R. 515, ¶ 14 (2012) (holding the agency accountable for the actions of its contactor). 

208 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 3-6, 13-14 (2012). 

209 Phillips v. Department of Homeland Security, 118 M.S.P.R. 515, ¶¶ 3-6, 13-14 (2012). 

210 Godwin v. Department of Defense, 228 F.3d 1332, 1336 (Fed. Cir. 2000). 

211 Godwin v. Department of Defense, 228 F.3d 1332, 1334 (Fed. Cir. 2000).

212 Godwin v. Department of Defense, 228 F.3d 1332, 1334-36 (Fed. Cir. 2000).

213 Godwin v. Department of Defense, 228 F.3d 1332, 1336 (Fed. Cir. 2000).

214 Godwin v. Department of Defense, 228 F.3d 1332, 1338 (Fed. Cir. 2000). As the court explained, “The agency was thus 

protected against the risk that a prospective employer would obtain a negative recommendation from someone other than 

[a designated official] – perhaps someone who was not aware of the settlement agreement or was not schooled in the proper 

manner of responding to inquiries governed by the agreement.” Id. at 1336.
30 Clean Record Settlement Agreements And The Law

Disclosing the Record

Division, Federal Aviation Administration, 2300 East Devon Ave., Des Plaines, Illinois 

60018, phone 847 294 ****, Facsimile (847) 294 ****.”215 The CRA included a footnote 

that the “*” digits would be provided by January 24, 2007.216 However, the agency failed 

to provide those numbers.217 The CRA also specified the content of the neutral references 

to be given but did not contain the names of any individuals who would give the neutral 

references.218

On June 20, 2008, a secretary in the Federal Aviation Administration’s (FAA’s) Human 

Resources Division (HRD) received a request for “employment verification, the reason for 

separation, and any other details regarding Mr. Allison’s time at the FAA.”219 The secretary 

then provided printouts from an automated system that indicated that the appellant had 

been removed and the removal action was cancelled due to a settlement agreement.220 

The agency argued that it was not liable for the breach because the appellant was purportedly 

responsible for the disclosure due to his failure to: (1) obtain more specific contact 

information for references from the agency; and (2) instruct the prospective employer to 

contact the “Employment Services Branch” within HRD, which allegedly was the only 

office that was supposed respond to requests for employment information.221

The Board found that, to the extent that it was the agency’s intent to limit the employees 

who would provide an employment reference by providing the telephone number for a 

particular employee or branch as part of the settlement agreement, the agency’s failure 

to promptly provide the numbers as required by the agreement could not allow it to 

escape responsibility when someone else in HRD was contacted.222 

The agreement also did not specify the names of the individuals in HRD who would reply 

or which branch in HRD would respond to inquiries.223 Unlike Godwin, where there was 

a specific individual charged with responding and the agency was not liable for a disclosure 

by someone else, in Allison, by narrowing the non-disclosure obligation to all of HRD, 

215 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶ 3 (2009).

216 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶ 3 (2009).

217 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶ 8 (2009). The agency finally provided the digits after the 

appellant filed his PFE. Id.

218 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶ 3 (2009).

219 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶ 4 (2009).

220 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶¶ 4-5, 10 (2009).

221 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶¶ 12-13 (2009).

222 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶¶ 12, 14 (2009).

223 Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶¶ 13-14 (2009).
A Report by the U.S. Merit Systems Protection Board 31

Disclosing the Record

the agency was responsible for the actions of the HRD secretary who released the negative 

information and thereby was responsible for the breach of the agreement.224

224 Compare Godwin v. Department of Defense, 228 F.3d 1332, 1336 (Fed. Cir. 2000) with Allison v. Department of Transportation, 111 

M.S.P.R. 62, ¶ 14 (2009).
32 Clean Record Settlement Agreements And The Law
A Report by the U.S. Merit Systems Protection Board 33

Below we discuss two cases in which the agency provided to an outsider information about 

the appellant that had been cleaned from the official record and permitted the appellant’s 

coworkers to speak about the appellant. Both cases involved a waiver signed by the 

appellant authorizing discussion of the appellant’s work history. Yet, the outcomes were 

different because the waivers differed in specificity.

In Del Balzo v. Department of the Interior, the appellant was a Criminal Investigator removed 

for allegedly falsifying travel vouchers.225 The parties entered into a CRA, which stated 

that the agency would direct all employment inquiries to the appellant’s former secondlevel supervisor or, in that official’s absence, to the Deputy Assistant Inspector General for 

Investigations.226 The agency further agreed that the official to whom the inquiries were 

directed would only communicate that the appellant had resigned from his position for 

personal reasons, the dates on which the appellant’s employment with the agency began 

and ended, and the type of work he performed.227 

The appellant subsequently applied for the position of Investigator in the Department of 

Housing and Urban Development (HUD) and was given a tentative job offer conditional 

upon a successful suitability determination.228 When HUD first contacted the Department 

of the Interior (DOI), one of the individuals authorized by the agreement to speak about 

the appellant (Sheehan) responded, and his response comported with the CRA.229 

However, HUD then showed Sheehan a waiver signed by the appellant “authorizing and 

directing his former employing agency to release [to HUD investigators] information 

regarding his activities” including his performance and disciplinary history. Sheehan then 

provided HUD with access to a file about the investigation into the appellant that included 

information related to charges in the appellant’s removal.230

225 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 660 (1994). 

226 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 660-61 (1994). 

227 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 661 (1994). 

228 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 661 (1994). 

229 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 661 (1994). 

230 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 661 (1994). 

WAIVING 

CONFIDENTIALITY
34 Clean Record Settlement Agreeements and the Law

Waiving Confidentiality

The appellant’s supervisor also was contacted by HUD, and while he refused to discuss 

details about the appellant, he gave HUD access to DOI employees who had been the 

appellant’s coworkers.231 This access was at the work site, during working hours, and 

over agency telephones.232 The coworkers provided negative references.233 The Board 

found that construing the release form’s provisions broadly enough to authorize either 

the investigation file or the discussions with coworkers would be inconsistent with the 

purpose of the settlement agreement and the agency therefore violated the settlement 

agreement by disclosing information beyond that described in the agreement.234

A few years later, the Interstate Commerce Commission faced a similar situation involving 

a general waiver.235 In Hosey v. Interstate Commerce Commission, the CRA stated that the 

agency would designate a contact for prospective employment references sought on behalf 

of the appellant and that the contact would release only certain information such as dates 

of employment.236 When the appellant was selected for a position requiring a top secret 

clearance, the investigator was stymied in his efforts because all of the individuals he 

contacted referred him to the designated person, and that person informed the investigator 

that the general release signed in the appellant’s application for the security clearance was 

not adequate to authorize the release of the desired information.237 The agency said that it 

would only provide further information or permit interviews with other employees if the 

agency received a more specific release authorization signed by the appellant.238

The investigator informed the appellant of the need for a more specific release in order to 

conduct the investigation for the required clearance level, and the appellant signed such a 

release, which expressly mentioned the ability to interview supervisors and co-workers as 

well as access to records.239 The agency then allowed the investigator to speak with former 

coworkers and supervisors and granted access to the litigation file containing negative 

information about the appellant.240

231 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 661, 664 (1994). 

232 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 664 (1994). 

233 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 661 (1994). 

234 Del Balzo v. Department of the Interior, 60 M.S.P.R. 659, 663-65 (1994).

235 Compare Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605 (1997) (in which there was a CRA that specified who 

would respond to contacts, that a neutral reference would be given, and in which a general waiver was then presented to the 

agency) with Del Balzo v. Department of the Interior, 60 M.S.P.R. 659 (1994) (in which there was a CRA that specified who would 

respond to contacts, that a neutral reference would be given, and in which a general waiver was then presented to the agency).

236 Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605, 607 (1997).

237 Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605, 607-08 (1997).

238 Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605, 608 (1997).

239 Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605, 608 (1997).

240 Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605, 608 (1997).
A Report by the U.S. Merit Systems Protection Board 35

Waiving COnfidentiality

The appellant asserted that this release of negative information constituted a breach of the 

agreement.241 The Board found that a valid waiver requires: (1) the existence at the time of 

the waiver of a right, privilege, advantage, or benefit that may be waived; (2) the actual or 

constructive knowledge thereof; and (3) an intention to relinquish it.242 The Board found 

that all three elements were met in Hosey, and therefore the appellant had waived his right 

to require the non-disclosure of negative information.243

Similarly in Lowe v. Department of Veterans Affairs, discussed earlier, the agency entered into 

a CRA and was later presented with a request for information from an attorney for the City 

of Jacksonville, Arkansas, accompanied by a “Release of Employment Information” signed 

by the appellant.244 The agency then released the appellant’s OPF to the requestor.245 The 

Board, citing Hosey, applied the test from that case to the facts of Lowe and found that 

the release satisfied all three elements. The Board therefore found that the agency had not 

breached the CRA.246

241 Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605, 608 (1997).

242 Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605, 609 (1997).

243 Hosey v. Interstate Commerce Commission, 74 M.S.P.R. 605, 609-10 (1997). 

244 Lowe v. Department of Veterans Affairs, 85 M.S.P.R. 219, ¶¶ 3, 5 (2000).

245 Lowe v. Department of Veterans Affairs, 85 M.S.P.R. 219, ¶ 5 (2000).

246 Lowe v. Department of Veterans Affairs, 85 M.S.P.R. 219, ¶¶ 11-12 (2000). In Lowe, the NSA stated that the “agreement 

will be kept confidential and the terms herein shall not be disclosed by either party, except to authorized officials responsible 

for implementing the agreement[.]” Id. at ¶ 3. However, it also stated that the agency “reserves the right to discuss the 

circumstances of [the appellant’s] resignation with prospective employers.” Id. at ¶ 3. In her PFE, the appellant asserted that 

the agency broke the confidentiality clause of the NSA when it disclosed the resignation in lieu of removal to an attorney for 

the City of Jacksonville. Id. at ¶ 3. The agency argued that it was permitted to send the information under the “prospective 

employers” clause while the appellant argued that the City of Jacksonville was not a prospective employer. Id. at ¶ 11, n.4. The 

Board held that, because the waiver issue was dispositive, there was no need to address whether the prospective employer clause 

was met by the facts of the case. Id. 
36 Clean Record Settlement Agreements And The Law
A Report by the U.S. Merit Systems Protection Board 37

EXTERNAL RESTRICTIONS 

ON THE EFFECT OF A CRA

There are limits to the contractual promises that a court can enforce.247 A court cannot 

require a party to take actions that violate the law, even if the parties have contracted to 

do so.248 A court cannot use a settlement agreement to “impose duties or obligations on 

a third party without that party’s agreement.”249 This means that it cannot compel a third 

party to accept particular facts or alter the third party’s separate entitlement to receive or 

disclose facts.250 This chapter discusses various cases in which issues as to the enforceability 

of the agreement arose because of restrictions on what a contract between two parties can 

achieve when a third party is involved.

PUBLIC POLICY LIMITATIONS

Certain situations can require an agency to make disclosures regardless of the terms of a 

CRA.251 For example, in Fomby-Denson v. Department of the Army, the appellant was a U.S. 

citizen employed with the U.S. Army at a duty station in Germany.252 The appellant was 

removed for alleged child neglect and forgery.253 The appellant filed an appeal and a CRA 

was reached in which the agency agreed that the OPF would be cleaned and the terms of 

247 See Hurd v. Hodge, 334 U.S. 24, 34-35 (1948) (“The power of the federal courts to enforce the terms of private agreements 

is at all times exercised subject to the restrictions and limitations of the public policy of the United States as manifested in the 

Constitution, treaties, federal statutes, and applicable legal precedents. Where the enforcement of private agreements would be 

violative of that policy, it is the obligation of courts to refrain from such exertions of judicial power.”)

248 See Hurd v. Hodge, 334 U.S. 24, 34-35 (1948).

249 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 17 (2003).

250 See, e.g., Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 21 (2003) (OPM is not required to accept the alleged 

facts presented to it when those facts are the result of a settlement agreement); Stevenson v. Office of Personnel Management, 103 

M.S.P.R. 481, ¶ 11 (2006) (the agency was “obligated to provide” certain information to OPM “regardless of the terms of 

the settlement agreement”); Vance v. Department of Interior, 114 M.S.P.R. 679 (2010) (because of the independence accorded to 

Inspectors General, neither the Board nor an agency has the authority to order an OIG to remain silent about the results of an 

investigation conducted by the OIG); Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 159-60 (1997) (the appellant was 

obligated to report to a new employer that he had left a position by mutual agreement and failure to disclose this was grounds 

for removal and debarment), aff’d 155 F.3d 565 (1998).

251 See, e.g., Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1376 (Fed. Cir. 2001) (holding that the United States 

cannot contractually bind itself not to refer criminal misconduct); Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 23 

(2001) (holding that an agency cannot contract to withhold from OPM police or criminal records pertinent to a background or 

suitability investigation). But see Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 16 (2009) (explaining that the 

holding in Gizzarelli is limited to situations where an agency discloses police or criminal information to OPM for a suitability 

determination and does not apply to information about performance or non-criminal conduct issues).

252 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1368 (Fed. Cir. 2001).

253 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1369 (Fed. Cir. 2001).
38 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

the agreement would “not be publicized or divulged in any manner, except as is reasonably 

necessary to administer its terms.”254 Approximately one month after the agreement was 

signed, the Army forwarded to local officials its allegations for possible investigation and 

prosecution.255 A few days after that, the Army notified immigration officials that the 

appellant was no longer an Army employee who could benefit from the Status of Forces 

Agreement (SOFA) and informed them of the appellant’s alleged criminal conduct.256

When contacted by local officials about her conduct, the appellant contacted the Army to 

ask if they requested that the local officials investigate her, and if so, to ask that the request 

be withdrawn.257 The Army replied:

We have always had an obligation to the German government to report 

suspected criminal violations of German law and only refrained, in 

your client’s case, because the MSPB case was pending and we believed 

she would be losing her eligibility to remain in Germany as a result of 

those proceedings. . . . Other than making a truthful report of what 

had happened, the US Army has had no involvement in any German 

investigation. . . . Moreover, we have no authority to interfere now 

in the German government’s investigation of an incident that they 

apparently also consider serious enough to take action on.258

The appellant filed a PFE alleging that the referral of the criminal charges to the local 

authorities constituted a breach of the CRA. The AJ found that the agreement did not 

prohibit such referrals.259 The Federal Circuit agreed as to the result, but on a different basis. 

Specifically, it found that, although the agreement was ambiguous as to the referrals, the 

issue was immaterial to the outcome because under the appellant’s proffered interpretation, 

the agreement would be void on public policy grounds.260

The court held that to “declare a contract unenforceable on public policy grounds. . . 

courts must first determine that the public policy at issue is well defined and dominant.”261

The court then noted that, for more than 700 years, it has been public policy to require 

citizens to notify the authorities when a crime is committed—it was called raising a “hue 

254 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1369 (Fed. Cir. 2001).

255 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1369 (Fed. Cir. 2001).

256 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1369-70 (Fed. Cir. 2001).

257 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1370 (Fed. Cir. 2001).

258 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1370 (Fed. Cir. 2001).

259 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1371 (Fed. Cir. 2001).

260 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1373, 1378 (Fed. Cir. 2001).

261 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1375 (Fed. Cir. 2001).
A Report by the U.S. Merit Systems Protection Board 39

External Restrictions on the Effect of CRA

and cry.”262 On this basis, the court found that an agreement that requires a party to not 

disclose a crime is contrary to public policy and is therefore unenforceable.263

Another case concerning a CRA’s public policy implications is Gizzarelli v. Department 

of the Army. In Gizzarelli, the appellant and the Army entered into a CRA in which 

the agency agreed that it would “not disclose any information to prospective employers 

which would indicate that [the appellant] was removed” and would provide only certain 

neutral information authorized in 5 C.F.R. § 293.311(a) such as the appellant’s grades, 

duty stations, and position descriptions.264 The appellant later received an appointment 

from the Social Security Administration (SSA), which required a background check.265

Acting in its role performing such checks, OPM asked the Army’s Crime Records Center 

for “pertinent information” about the appellant, at which time the Army informed OPM 

that the appellant had admitted that she “had stolen agency property, transported the 

stolen property in government-owned vehicles, and used agency employees to remodel her 

home.”266 The Army also notified OPM that the “Military Police found probable cause to 

believe that the appellant had committed the criminal offenses of receiving stolen property, 

larceny and embezzlement, and fraud.”267

The appellant filed a PFE arguing that the agency breached the agreement by giving OPM 

information that was not authorized by 5 C.F.R. § 293.311(a).268 

The Board found that the Federal Circuit’s reasoning in Fomby-Denson was “instructive” 

for Gizzarelli.

269 It noted that there was a “well defined and dominant” public policy issue 

at stake in protecting the citizenry from misconduct by public servants who were in a 

position of trust and that OPM’s investigation regulations were intended to protect that 

public interest.270 Accordingly, the Board found that the Army could not contractually bar

262 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1375 (Fed. Cir. 2001).

263 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1378 (Fed. Cir. 2001).

264 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 2 (2001) (indicating that the only information that would be 

released was that which is permitted under 5 C.F.R. § 293.311(a)); see 5 C.F.R. § 293.311(a) (describing neutral information to 

include grades, duty stations, position descriptions, etc.). 

265 Gizzarelli v. Department of Army, 90 M.S.P.R. 269, ¶ 3 (2001).

266 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶¶ 3-4 (2001).

267 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 4 (2001).

268 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶¶ 5-6 (2001).

269 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 10 (2001).

270 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 12 (2001).
40 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

itself from reporting alleged criminal activity to OPM if OPM’s inquiry was related to a 

background or suitability investigation.271

However, in Cunningham v. Office of Personnel Management, the Board distinguished 

cases such as Gizzarelli from those in which there were no allegations of criminal activity. 

In Cunningham, the appellant was a criminal investigator who was removed during his 

probationary period for unspecified reasons.272 The parties entered into a CRA under 

which the agency agreed that it would keep the “terms, amount, and facts of [the] 

Agreement completely confidential, except to the extent disclosure may be required by 

law, regulation, subpoena or court order.”273 The appellant then obtained a position with 

a private contractor who performed investigations for the agency.274 Due to the duties 

of the position with the contractor, the appellant was subject to a background check.275

OPM told the private sector investigator that the appellant: (1) was separated from the 

agency; (2) filed an MSPB appeal; (3) reached a settlement agreement with the agency; and 

(4) “now” had a record that showed a resignation.276 

The appellant filed a PFE arguing that the communication of this information constituted 

a breach of the CRA.277 The Board noted that it decided Gizzarelli on narrow grounds and 

had explicitly stated that it was “not finding that OPM can obtain personnel records related 

to misconduct or performance where a settlement agreement prevents the release of such 

271 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶¶ 15, 33 (2001). This issue has also arisen, but not been fully 

addressed, in the context of the duties of the Office of Special Counsel (OSC) and criminal investigators acting based on 

referrals from OSC. See Doe v. Department of the Army, 116 M.S.P.R. 160 (2011). In Doe, the employing agency and the appellant 

reached a CRA in which the agency was obligated to “amend” Doe’s records to reflect a resignation instead of a removal. Id. 

at ¶ 2. OSC referred a travel fraud allegation to Army’s Criminal Investigation Division (CID), which asked a question of the 

appellant’s supervisor, who was purportedly under oath and disclosed the removal in response to the question. Id. at ¶ 3. CID 

then purportedly gave the information to OSC, leading to the appellant’s concern that OSC might publish it. Id. In response to 

the appellant’s PFE for breach, the agency asserted that if anyone violated the appellant’s privacy, it was OSC, not the agency. 

Id. at 4. The Board remanded the case back to the Central Regional Office to address the question of whether there had been a 

breach of the CRA in the particular context of this case. Id. at ¶ 11-12. 

272 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 2 (2009). Typically, the Board does not have jurisdiction 

over the termination of a probationer. See 5 U.S.C. § 7511; but see McCormick v. Department of the Air Force, 307 F.3d 1339, 1342-43 

(Fed. Cir. 2002) (a probationer has appeal rights if he or she has completed 1 year of current continuous service under other 

than a temporary appointment limited to 1 year or less). However, actions based upon partisan politics or marital status can 

be appealed to the MSPB, as can procedural issues for terminations based upon pre-appointment causes. See Von Deneen v. 

Department of Transportation, 33 M.S.P.R. 420 (1987); 5 C.F.R. § 315.805, 315.806. Probationers may also appeal whistleblowing 

reprisal personnel actions to the Board. See Horton v. Department of the Navy, 66 F.3d 279 (Fed. Cir. 1995); Eidmann v. Merit Systems 

Protection Board, 976 F.2d 1400, 1407-08 (Fed. Cir. 1992). Jurisdiction in Cunningham was based upon the appellant’s nonfrivolous 

allegations of marital status discrimination. Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 2 (2009); but see Burton 

v. Department of the Air Force, 118 M.S.P.R. 2010, ¶ ¶ 8 n.1, 9-11, n.2 (2012) (under Federal Circuit precedent and the Board’s 

regulations, jurisdiction over a part 315 appeal is established by preponderant evidence – not by nonfrivolous allegations).

273 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 3 (2009).

274 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 4 (2009). 

275 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 4 (2009). 

276 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 18 (2009) (from the Board’s findings of facts).

277 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 5 (2009). 
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External Restrictions on the Effect of CRA

personnel records.”278 The Board found that Cunningham fell into the broader category of 

CRAs in which a disclosure was not permitted because the agency did not disclose criminal 

conduct.279 As the agency had materially breached the CRA, the appellant was, in 2009, 

given the option to reinstate his 2005 appeal.280

The decisions in Gizzarelli and Cunningham illustrate that the nature of the details being 

disclosed can matter regardless of the words of the contract.281 The public policy exception 

is based upon the “well defined and dominant” public interest in what is being disclosed.282

Thus, while much of this report discusses broad implied obligations and the importance 

of using clear and narrowing language in any attemps to narrow thoses obligations, it is 

mportant to recognize that the content of the CRA will not always determine the outcome 

—the information that the parties seek to keep confidential can determine whether 

confidentiality is possible.283

Below we discuss a case from the U.S. Court of Appeals for the First Circuit. Decisions of 

the Federal Circuit are binding on the Board, but decisions of the other circuits are only 

persuasive—meaning the Board can allow itself to be persuaded by the legal reasoning of 

such courts, yet is not bound to follow their decisions.284 In Gizarrelli, the Board discussed 

a case from the First Circuit which it found persuasive on the question of whether an 

NSA requiring confidentiality was void as a matter of public policy—Equal Employment 

Opportunity Commission v. Astra USA, Inc., 94 F.3d 738 (1st Cir. 1996).285 Because the 

Board found Astra persuasive in Gizzarelli, we discuss those aspects of Astra below, yet we 

remind readers that Astra itself is not binding precedent on the Board.286

278 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 15 (2009) (quoting Gizzarelli v. Department of the Army, 90 

M.S.P.R. 269, ¶ 23 (2001)).

279 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶ 16 (2009). 

280 Cunningham v. Office of Personnel Management, 110 M.S.P.R. 389, ¶¶ 1, 21 (2009). 

281 Compare Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 23 (2001) (an agency cannot contract to withhold from 

OPM police or criminal records pertinent to a background or suitability investigation) with Cunningham v. Office of Personnel 

Management, 110 M.S.P.R. 389, ¶ 16 (2009) (the holding in Gizzarelli is limited to situations where an agency discloses police or 

criminal information to OPM for a suitability determination and does not apply to information about performance or noncriminal conduct issues).

282 Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1375 (Fed. Cir. 2001).

283 See Fomby-Denson v. Department of the Army, 247 F.3d 1366, 1378 (Fed. Cir. 2001) (agencies cannot contract to hide a crime); 

Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 23 (2001) (an agency cannot contract to withhold from OPM police or 

criminal records pertinent to a background or suitability investigation); Cunningham v. Office of Personnel Management, 110 M.S.P.R. 

389, ¶ 16 (2009) (the holding in Gizzarelli is limited to situations where an agency discloses police or criminal information to 

OPM for a suitability determination and does not apply to information about performance or non-criminal conduct issues).

284 Fairall v. Veterans Administration, 33 M.S.P.R. 33, 39 (decisions of the U.S. Court of Appeals for the Federal Circuit are 

controlling authority for the Board, and decisions of other Federal circuit courts may be persuasive, but are not controlling, 

authority), aff’d, 844 F.2d 775 (Fed. Cir. 1987).

285 See Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶¶ 18-22 (2001).

286 See Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶¶ 18-22 (2001).
42 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

In Astra, the employer, Astra USA, Inc., entered into settlement agreements with at least 

11 of its employees who claimed to have been subjected to, or to have witnessed, sexual 

harassment.287 Under one of the terms of the agreements, the settling employees promised 

not to assist the EEOC in its investigation of such charges for other employees.288 The 

First Circuit found that: (1) Congress entrusted the EEOC with “significant enforcement

responsibilities” regarding Title VII discrimination matters; (2) for EEOC to fulfill its 

role, it was “crucial” that EEOC’s ability to investigate charges of discrimination “not be 

impaired”; (3) EEOC’s investigatory mission and authority would be “sharply curtailed” 

and “severely hampered” if the non-assistance clauses in the agreements were enforced; and 

(4) such interference in the EEOC’s fact-gathering function via private contracts “sows the 

seeds of harm to the public interest.”289

Upon weighing the “significant public interest in encouraging communication with EEOC 

against the minimal adverse impact that opening channels of communication would have 

on settlement,” the First Circuit “wholeheartedly” concurred with the district court’s 

determination that the non-assistance provisions were “void as against public policy.”290

EFFECTS OF CRA PROVISIONS ON ACTIONS OF THIRD PARTIES

A settlement agreement cannot impose duties or obligations on a third party without that 

party’s agreement.291 The cases below discuss situations in which the terms of the CRA 

affected an entity which did not have a representative sign the agreement. These cases 

287 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 18 (2001) (citing Equal Employment Opportunity Commission v. Astra 

USA, Inc., 94 F.3d 738, 741 (1st Cir. 1996)).

288 Equal Employment Opportunity Commission v. Astra USA, Inc., 94 F.3d 738, 740-41 (1st Cir. 1996); see Gizzarelli v. Department 

of the Army, 90 M.S.P.R. 269, ¶ 18 (2001).

289 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 19 (2001) (quoting Equal Employment Opportunity Commission v. Astra 

USA, Inc., 94 F.3d 738, 744 (1st Cir. 1996)).

290 Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶ 21 (2001) (quoting Equal Employment Opportunity Commission v. Astra 

USA, Inc., 94 F.3d 738, 744-45 (1st Cir. 1996)). When applying the logic from Astra to the facts in Gizzarelli, the Board found 

that when OPM operates in its role as investigator to protect the public’s interest in having trustworthy public servants, for an 

agency to withhold the appellant’s criminal history from OPM would violate public policy. Gizzarelli v. Department of the Army, 

90 M.S.P.R. 269, ¶¶ 22-23 (2001). The parties could not be permitted, “thorough a private agreement, to thwart the public’s 

interest” and thus the agency could not be compelled to withhold from OPM the information that it needed to perform its 

duties. Gizzarelli v. Department of the Army, 90 M.S.P.R. 269, ¶¶ 22-23, 33 (2001).

291 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 17 (2003) (citing Jordan v. Office of Personnel Management, 77 M.S.P.R. 

610, 616 (1998)).
A Report by the U.S. Merit Systems Protection Board 43

External Restrictions on the Effect of CRA

illustrate the importance of determining who is a third party and what rights a third party 

has that cannot be taken away by a contract between the two other parties.292

Retirement Benefits and CRAs

Retirement is often an important issue for at least one of the parties negotiating a CRA.293

Half of our surveyed agency representatives reported that they had “been involved in 

an agreement where the agency changed the type of action taken or the reason for the 

action in order to potentially assist the individual to obtain” a Government benefit such 

as retirement.294 However, as discussed below, the interaction between a CRA and an 

agency’s responsibilities when the appellant files for retirement can be complicated. 

OPM as Administrator of Retirement Benefits

One of the most important cases on the issue of NSAs interacting with retirement 

applications is Parker v. Office of Personnel Management, which was within the Board’s 

jurisdiction to adjudicate appeals of OPM retirement decisions.295 In Parker, the agency 

and employee used an NSA to resolve a dispute about reemployment.296 The agency agreed 

to provide the appellant with an appointment (and by implication an SF-50 showing this 

appointment) and the appellant, among other things, agreed to waive his right to advanced 

notice before being terminated.297 On the same day that it appointed the appellant (Feb. 

28, 1992), the agency notified the appellant that he would be removed effective Mar. 

2, 1992 (which was the next business day) for a failure to maintain a condition of that 

employment.298

The appellant then contacted OPM about a retirement annuity and was told that these 

SF-50s did not give him the right to an annuity because he had not been employed in a 

covered position for at least one of the two years preceding his application.299 The agency 

292 See, e.g., Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 21 (2003) (OPM is not required to accept the alleged 

facts presented to it when those facts are the result of a settlement agreement); Stevenson v. Office of Personnel Management, 103 

M.S.P.R. 481, ¶ 11 (2006) (the agency was “obligated to provide” certain information to OPM “regardless of the terms of the 

settlement agreement”). Compare Vance v. Department of Interior, 114 M.S.P.R. 679 (2010) (because of the independence accorded 

to Offices of the Inspectors General (OIGs), neither the Board nor an agency has the authority to order an OIG to remain silent 

about the results of an investigation conducted by the OIG) with Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 12 

(2012) (an OIG official committed a breach of a CRA when he disclosed a rescinded personnel action). 

293 See Appendix B, Question 7. 

294 See Appendix B, Question 7. 

295 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 18 (2003) (OPM’s authority to question a personnel action taken 

as a result of a settlement agreement applies whether the statutory provisions at issue implicate filing deadlines or substantive 

criteria for entitlement to a retirement benefit).

296 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 4 (2003).

297 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 4 (2003).

298 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 5 (2003).

299 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 5 (2003).
44 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

then issued an SF-50 showing that the appellant purportedly had been appointed nearly 

two years earlier.300 OPM examined the new evidence and determined that it was impossible for the employee to have been appointed to the civil service at that time as he was 

unavailable due to active duty in the military.301 OPM applied the Uniformed Services 

Employment and Reemployment Rights Act of 1994 (codified at 38 U.S.C. §§ 4301-

4333) (USERRA) to the situation but found that the appellant was not eligible for the 

requested benefits because the appellant had not been employed in the pertinent period 

and the SF-50s were, instead, “effected pursuant to a settlement agreement.”302

After various levels of appeal, the Board found that, with respect to a settlement agreement 

to which OPM is not a party, OPM has the authority to determine whether dates 

established by the agreement are “an artifice designed to evade the statutory requirements 

for entitlement to an annuity.”303 The Board found that “OPM’s authority to question a 

personnel action taken as a result of a settlement agreement applies whether the statutory 

provisions at issue implicate filing deadlines. . . or substantive criteria for entitlement to 

a retirement benefit, as in this case.”304 The agency’s retroactive appointment documents 

“were designed for no other purpose than to give the appearance that the appellant had the 

service necessary for him to receive a CSRS annuity, so that the cost of the settlement would 

be paid from” the retirement funds rather than the agency’s own funds.305 Accordingly, 

when reaching its decision on the appellant’s entitlement to retirement benefits, OPM was 

not required to recognize the period of service alleged in those documents.306

In Stevenson v. Office of Personnel Management, the Board applied Parker to a different set 

of facts and came to a similar conclusion about OPM’s freedom to disregard assertions 

from parties made as a result of a settlement agreement.307 In Stevenson, the appellant 

was removed for misconduct, but a CRA was reached in which the employing agency, the 

Department of Agriculture (USDA), agreed to cancel the removal action, substitute it with 

an SF-50 showing a medical inability to perform the essential duties of his position, and 

assist the appellant with his disability retirement application.308 

300 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 5 (2003).

301 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶¶ 5, 7 (2003).

302 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 9 (2003).

303 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 18 (2003). In its non-precedential decision affirming Parker, 

the court observed that the settlement “agreement appears to have simply been an invalid attempt to create entitlement to 

a retirement annuity under CSRS. The agreement was also contrary to law because it voluntarily arranged a supposedly 

‘involuntary’ separation as a basis for discontinued service retirement under 5 U.S.C. § 8336(d)(1).” Parker v. Office of Personnel 

Management, 91 F. App’x 660, 665 n.5 (Fed. Cir. 2004).

304 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 18 (2003).

305 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 20 (2003).

306 Parker v. Office of Personnel Management, 93 M.S.P.R. 529, ¶ 21 (2003).

307 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 12 (2006) (reiterating that OPM, in carrying out its statutory 

responsibility of deciding claims for disability retirement, may look behind a settlement agreement to which it was not a party). 

308 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 2 (2006). 
A Report by the U.S. Merit Systems Protection Board 45

External Restrictions on the Effect of CRA

The language used in the new SF-50 is critically linked to the issue of a disability retirement 

because the general rule for individuals seeking a retirement annuity is that the burden 

of proving entitlement to an annuity is on the applicant for benefits.309 However, an 

employee’s removal for medical inability to perform the essential functions of his position 

constitutes prima facie evidence that he is entitled to disability retirement; the burden of 

production then shifts to OPM to produce evidence sufficient to support a finding that 

the applicant is not entitled to disability retirement benefits; and if OPM produces such 

evidence, the applicant must then come forward with evidence to rebut OPM’s assertion 

that he is not entitled to benefits.310 In other words, Mr. Stevenson’s new SF-50 shifted 

the burden from the appellant to prove his entitlement to the annuity to OPM, which was 

given the burden to disprove it.311

The appellant filed for a disability annuity, but OPM denied the application, noting, 

among other things, that the appellant had been removed for misconduct and that he 

had not shown any nexus between his misconduct and his alleged medical condition.312

The appellant filed a PFE against USDA (presumably for letting OPM know of the 

removal action), and the appellant and the agency reached a new agreement in which in 

which USDA agreed to send OPM a letter stating its position that the appellant’s medical 

conditions prevented him from performing his essential job duties.313 However, in its 

reconsideration decision, OPM again found that the appellant’s alleged misconduct was 

his principal service deficiency and thus he was not entitled to a disability retirement.314 

The appellant filed an appeal of OPM’s reconsideration decision.315 On PFR, the Board 

cited Parker, above, and found that if OPM, in carrying out its statutory responsibility of 

deciding claims for disability retirement, may look behind a settlement agreement to which 

it was not a party, then it follows that the Board, in carrying out its statutory responsibility 

of reviewing an OPM final decision, may also look behind a settlement agreement to 

which OPM was not a party.316 The Board then found that the fact that the appellant did 

not file for a disability retirement until after he was removed for misconduct was a relevant 

309 See Cheeseman v. Office of Personnel Management, 791 F.2d 138, 14041 (Fed. Cir. 1986) (applying the rule to survivor 

annuities); 5 C.F.R. § 1201.56(a)(2)(iii) (“in appeals from reconsideration decisions of the Office of Personnel Management 

involving retirement benefits, if the appellant filed the application, the appellant has the burden of proving, by a preponderance 

of the evidence, entitlement to the benefits”).

310 Bruner v. Office of Personnel Management, 996 F.2d 290, 294 (Fed. Cir. 1993).

311 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 2 (2006). 

312 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶¶ 3-4 (2006). 

313 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 5 (2006). 

314 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 5 (2006). 

315 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 6 (2006). 

316 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 12 (2006). 
46 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

factor that detracted from his argument that he was eligible for a disability retirement.317

After analyzing other issues raised in the case, the Board concluded that the appellant had 

failed to show his entitlement to a disability retirement.318 In other words, the agency may 

have contracted that it would support the appellant’s retirement request, but neither OPM 

nor the Board were obliged to accept such claims.319

Because Stevenson preceded the Board’s guidance in Allen regarding false statements, which 

has not yet been raised directly in a retirement case, we cannot state how Allen would 

apply to a CRA case involving retirement applications and statements from supervisors 

about applicants for benefits.320 As with all cases discussed in this report, similarities 

or distinguishing features in a specific case may result in a similar or different outcome. 

However, in Stevenson, the Board noted that the law regarding CRAs and OPM has been 

“refined” since the Conant decision in 2001.321 The Board’s findings in Allen, and its 

holding regarding the legality of an agency official knowingly making a false statement or 

representation, or concealing material facts, may be another step in that evolution.322

Obligations Regarding Retirement Applications

A disability retirement application requires a statement from the agency about the 

appellant.323 Unlike a typical request for an employment reference, the supervisor’s 

statement for disability retirement applications is made on an official Government form 

approved by the Office of Management and Budget and requires the supervisor to certify 

that he or she is telling the truth to the best of his or her knowledge and belief. The form 

also instructs the supervisor to attach relevant documents.324 Silence by the agency official, 

which may be permitted in some CRA reference checks, is not an option for this form. 

Occasionally, parties will settle an appeal with the expectation that the appellant will 

apply for disability retirement. Under these circumstances, the parties should anticipate 

317 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 12 (2006). 

318 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 15 (2006). 

319 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶¶ 5, 12 (2006). 

320 Within the packet of forms for a disability application (SF-3112), the form that is signed by the employee includes, 

next to the signature block, the statement: “WARNING: Any intentionally false statement in this application or willful 

misrepresentation relative thereto is a violation of the law punishable by a fine of not more than $10,000 or imprisonment of not 

more than 5 years, or both. (18 U.S.C. 1001)”. U.S. Office of Personnel Management, Applicant’s Statement of Disability, SF3112(A) (May 2011) (emphasis in original), available at http://www.opm.gov/forms/standard-forms/.

321 Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 12 (2006).

322 Allen v. Department of Veterans Affairs, 112 M.S.P.R. 659 (2009); Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481 

(2006). See Volpe v. Trim, 708 F.3d 688, 702 (6th Cir. 2013) ( (“The law evolves over time with experience”); Derman v. United 

States, 298 F.3d 34, 40 (1st Cir. 2002) (“the law, by its nature, evolves over time”). 

323 See Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 11 (2006); U.S. Office of Personnel Management, 

Supervisor’s Statement, SF-3112(B) (May 2011), available at http://www.opm.gov/forms/standard-forms/.

324 U.S. Office of Personnel Management, Supervisor’s Statement, SF-3112(B).
A Report by the U.S. Merit Systems Protection Board 47

External Restrictions on the Effect of CRA

that the agency’s obligation to provide a truthful supervisor’s statement may conflict with 

the general disclosure limitations of the CRA. A well-drafted CRA should take this into 

account and address the supervisor’s statement separately, adjusting the parties’ expectations 

of what the supervisor’s statement may (and must) contain, and defining any limitations 

on the information that the agency may provide. As discussed below, parties have taken 

different approaches to this matter, including promises to support an application, promises 

not to oppose an application, and promises to refrain from including negative remarks 

in the supervisor’s statement. The parties may decide that any one of these approaches is 

appropriate for their particular needs, but whatever limitations the parties agree to, the 

agency must be sure that it is making a promise that it can keep and take care to confine 

its disclosures to the parameters of the CRA.

In Conant, discussed above, the agency promised in the CRA that it would “utilize its best 

efforts to effectuate the Grievant’s application for disability retirement[.]”325 The agency 

later submitted a negative supervisor’s statement to OPM and supporting documentation 

that included the removal SF-50.326 The Federal Circuit found that this act “sabotage[ed]” 

the retirement application and the agency had taken “affirmative steps to impede and to 

prejudice the process.”327 Making “unproven allegations of misconduct” and providing 

OPM with a copy of the rescinded removal SF-50 was inconsistent with the agency’s 

promise to make its “best efforts” to help the appellant obtain approval of her retirement 

application.328

In Lutz v. U.S. Postal Service, the agreement provided that:

Within 30 days of the date this Settlement Agreement is fully executed, 

Appellant agrees to take all necessary steps to apply for disability 

retirement with [OPM]. The Agency agrees to take all necessary steps 

to cooperate and facilitate the acceptance of Appellant’s application and 

agrees not to place negative statements in the supervisor’s statement.329

Nevertheless, the agency submitted to OPM a supervisor’s statement asserting, among 

other things, that the appellant was “supposedly” injured and had repeatedly “refused” to 

work when he was medically able to do so according to a fitness for duty examination.330

OPM denied the appellant’s application for a disability retirement.331 In a later overruled 

325 Conant v. Office of Personnel Management, 255 F.3d 1371, 1374 (Fed. Cir. 2001).

326 Conant v. Office of Personnel Management, 255 F.3d 1371, 1374 (Fed. Cir. 2001).

327 Conant v. Office of Personnel Management, 255 F.3d 1371, 1376 (Fed. Cir. 2001).

328 Conant v. Office of Personnel Management, 255 F.3d 1371, 1376 (Fed. Cir. 2001).

329 Lutz v. U.S. Postal Service, 108 M.S.P.R. 695, ¶ 2 (2008).

330 Lutz v. U.S. Postal Service, 100 M.S.P.R. 600, ¶ 5 (2005).

331 Lutz v. U.S. Postal Service, 100 M.S.P.R. 600, ¶ 9 (2005).
48 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

decision, the Board, assuming arguendo that the agency had breached the CRA by providing 

negative information, held that the breach was not material because the Board determined 

that OPM’s basis for denying the application was “the appellant[’s] fail[ure] to supply the 

required medical documentation to support his claim of disability.”332

The Federal Circuit reversed.333 The court found that the supervisor’s statement the agency 

submitted to OPM was “indisputably negative in tone,” and “rife” with innuendo[.]”334

Because the agency agreed to avoid being “negative” and then characterized the appellant’s 

actions in a negative manner, the agency breached the agreement.335 The court found that, 

“[w]hile it is impossible to know precisely to what extent these statements colored the 

analysis of OPM, it is clear that the statements did discourage OPM’s acceptance of Mr. 

Lutz’s disability retirement application. Therefore, the breach was not immaterial[.]”336

The court remanded the case to the Board for further proceedings.337 

On remand, the Board noted that the agency’s action was not a curable breach, because 

OPM “is not a party to either to the settlement agreement or this appeal. . . . We therefore 

lack the authority, in the context of this case, to compel OPM to reconsider the appellant’s 

application for disability retirement or to expunge the initial supervisor’s statement from 

its record.”338 Accordingly, the CRA was rescinded and the appellant’s demotion appeal 

was reinstated for adjudication.339 

In Miller v. U.S. Postal Service, the agency likewise agreed not to affirmatively oppose the 

appellant’s disability retirement application.340 However, the CRA in Miller also addressed 

the possibility that the agency might be put in the position where being truthful to the 

best of its knowledge on the supervisor’s statement could impede the appellant’s ability 

to obtain a disability retirement.341 It expressly did “not require the agency to provide 

incorrect information to the Office of Personnel Management.”342

332 Lutz v. U.S. Postal Service, 100 M.S.P.R. 600, ¶ 9 (2005).

333 Lutz v. U.S. Postal Service, 485 F.3d 1377, 1382 (Fed. Cir. 2007).

334 Lutz v. U.S. Postal Service, 485 F.3d 1377, 1381 (Fed. Cir. 2007). 

335 Lutz v. U.S. Postal Service, 485 F.3d 1377, 1381-82 (Fed. Cir. 2007).

336 Lutz v. U.S. Postal Service, 485 F.3d 1377, 1382 (Fed. Cir. 2007).

337 Lutz v. U.S. Postal Service, 485 F.3d 1377, 1382 (Fed. Cir. 2007).

338 Lutz v. U.S. Postal Service, 108 M.S.P.R. 695, ¶ 12 (2008). 

339 Lutz v. U.S. Postal Service, 108 M.S.P.R. 695, ¶ ¶ 14-15 (2008).

340 Compare Miller v. U.S. Postal Service, 90 M.S.P.R. 550, ¶ 10 (2002) with Conant v. Office of Personnel Management, 255 F.3d 1371, 

1374 (Fed. Cir. 2001) (promising the agency’s best efforts to help the appellant); Lutz v. U.S. Postal Service, 108 M.S.P.R. 695, ¶ 2 

(2008) (promising no negative statements).

341 Miller v. U.S. Postal Service, 90 M.S.P.R. 550, ¶ 10 (2002). 

342 Miller v. U.S. Postal Service, 90 M.S.P.R. 550, ¶ 13 (2002). 
A Report by the U.S. Merit Systems Protection Board 49

External Restrictions on the Effect of CRA

The appellant filed a PFE, arguing that the agency breached the settlement agreement 

by informing OPM of the modified assignments that it had offered the appellant. The 

agency informed OPM of modified positions that it had offered to the appellant.343 The 

Board disagreed, finding that the agency had not affirmatively opposed the appellant’s 

application and that the agency was required to disclose information about the modified 

assignments.344 The information that the agency provided to OPM showing that it offered 

the appellant work that she could medically perform was consistent with the record 

and thus fell into the exception in the CRA that the agency was not required to provide 

incorrect information.345 Because the agency’s disclosure fell within the parameters of the 

CRA, there was no breach.346

Similarly, in Komiskey v. Department of the Army, the agreement recognized that OPM 

rules were likely to pose a problem for a retirement application and specifically addressed 

the conflict in the agreement.347 In Komiskey, the appellant wanted a discontinued service 

retirement, which, under the particular circumstances of the case, required an involuntary 

separation for performance.348 However, she also wanted a clean record, which was not 

consistent with being involuntarily separated for performance.349 The CRA expressly stated 

OPM was unlikely to permit both, but the agency would “make all efforts” to process the 

retirement in “such a way” that the appellant would have the clean record.350

The appellant later filed a PFE, arguing that the agency had breached the agreement by 

processing her retirement without obtaining a clean record for her.351 The Board found 

that the agency had met its obligations because it asked OPM to process the retirement in 

a manner that would not refer to the performance-based action and by requesting from 

OPM that no records be maintained with negative information about the appellant.352

The Board noted that OPM responded by asserting “its firm position that statutory 

requirements cannot be waived to accommodate settlement agreements,” and found that 

the Army was not accountable for the decisions of OPM.353 The agency’s obligation under 

343Miller v. U.S. Postal Service, 90 M.S.P.R. 550, ¶ 10 (2002).

344Miller v. U.S. Postal Service, 90 M.S.P.R. 550, ¶ 10 (2002). OPM’s form to be completed by supervisors for disability 

retirement applications specifically asks the supervisor about efforts to accommodate the employee. U.S. Office of Personnel 

Management, Supervisor’s Statement, SF-3112(B).

345 Miller v. U.S. Postal Service, 90 M.S.P.R. 550, ¶ 10 (2002).

346 Miller v. U.S. Postal Service, 90 M.S.P.R. 550, ¶ 13 (2002).

347 Komiskey v. Department of the Army, 70 M.S.P.R. 607, 608 (1996).

348 Komiskey v. Department of the Army, 70 M.S.P.R. 607, 608 (1996).

349 Komiskey v. Department of the Army, 70 M.S.P.R. 607, 608 (1996).

350 Komiskey v. Department of the Army, 70 M.S.P.R. 607, 608 (1996).

351 Komiskey v. Department of the Army, 70 M.S.P.R. 607, 609 (1996).

352 Komiskey v. Department of the Army, 70 M.S.P.R. 607, 610 (1996).

353 Komiskey v. Department of the Army, 70 M.S.P.R. 607, 610 (1996).
50 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

the agreement was to ask for the clean record in addition to the retirement, but under the 

terms of the agreement it was not obligated to succeed with that request.354 

Office of the Inspector General

As explained in the previous section, OPM, as a third party, is not bound by the terms 

of a CRA signed by another agency.355 Depending on the facts of the case, the Office of 

the Inspector General (OIG) may be treated as a third party whose actions also cannot be 

bound by the contract, or it may be considered a part of the agency bound by the CRA.

In Vance v. Department of Interior, the agency’s OIG was involved in an audit of the 

appellant’s Government credit card use that resulted in findings of misuse that led to the 

appellant’s removal.356 The agency entered into a CRA with the appellant under which 

the agency agreed to “rescind, expunge, and remove the proposal notice, decision, and 

Standard Form 50 (SF-50) reflecting the appellant’s removal from the appellant’s Official 

Personnel File (OPF) and from all of the agency’s electronic and paper files.”357 However, the 

OIG published the results of its investigation in its semiannual report to Congress and the 

report naming the appellant remained available to the public on the OIG’s website.358 The 

appellant filed a PFE alleging that this publication on the website constituted a breach of 

the CRA.359 

The Board found that, once the OIG decided to issue the report, the agency could not 

compel the Inspector General to stop its publication or to demand that it be corrected 

because “the head of the agency may not generally prevent the Inspector General’s report 

from going to Congress or alter or delete the report.”360 The Board found that it also lacked 

the authority to order the OIG to alter its report.361

Therefore, regardless of whether the agreement’s provision was a result of a mutual mistake 

by both parties as to what control the agency could exercise over the OIG, or whether 

354 Komiskey v. Department of the Army, 70 M.S.P.R. 607, 610 (1996).

355 See Stevenson v. Office of Personnel Management, 103 M.S.P.R. 481, ¶ 12 (2006) (neither OPM, nor the Board when reviewing 

OPM decisions, is bound by the terms of a CRA to which they are not parties).

356 Vance v. Department of Interior, 114 M.S.P.R. 679, ¶¶ 2, 10 (2010). 

357 Vance v. Department of Interior, 114 M.S.P.R. 679, ¶¶ 2-3 (2010) (emphasis added). 

358 Vance v. Department of Interior, 114 M.S.P.R. 679, ¶ 3 (2010). 

359 Vance v. Department of Interior, 114 M.S.P.R. 679, ¶ 3 (2010). 

360 Vance v. Department of Interior, 114 M.S.P.R. 679, ¶ 11 (2010) (internal punctuation and citations omitted).

361 Vance v. Department of Interior, 114 M.S.P.R. 679, ¶ 11 (2010); but see Kramer v. Department of the Navy, 46 M.S.P.R. 187, 

191-92 (1990) (holding that when an agency representative signs an agreement, it binds the agency as a whole, including other 

commands within the agency).
A Report by the U.S. Merit Systems Protection Board 51

External Restrictions on the Effect of CRA

the agency had negotiated in bad faith something it knew it could not accomplish, the 

agreement had to be set aside because the provision could not be put into effect.362 

However, in Zumwalt v. Department of Veterans Affairs, the Board found that an OIG was 

responsible for complying with the agency’s CRA.363 The parties in that case entered into a 

CRA under which the agency was obligated to cancel a 3-day suspension for misusing the 

Utah Bureau of Criminal Identifications (BCI) database.364 The agreement provided that 

the parties would keep the terms of the agreement confidential and that the agency would 

disclose the terms of the agreement only to those management officials that it determined 

needed to know specific terms to implement them.365 After the CRA was signed, an OIG 

official, Morse, heard a rumor about misuse of the BCI database, investigated further, 

and when later asked by Utah officials what had happened to the appellant, Morse told 

those officials about the 3-day suspension.366 The appellant filed a PFE, arguing that the 

disclosure by Morse violated the agreement.367

The Board found that, regardless of his position in the agency’s organizational structure, 

Morse was an agency employee representing the interests of the agency when he disclosed 

the appellant’s suspension, thereby denying the appellant the benefit of the clean record that 

the agency promised him in exchange for the withdrawal of his IRA appeal.368 Therefore, 

the disclosure constituted a breach of the agreement.369 In a dissenting opinion, Member 

Robbins expressed that, because of the OIG’s independence, he would have found that the 

OIG was not a party to the CRA.370

RESPONSES ON OPM FORMS ABOUT AN INDIVIDUAL’S BACKGROUND

Several of the cases that we have discussed include examples of occasions when agencies 

were put in difficult positions when they were asked about the conduct or performance of 

individuals covered by a CRA. However, employees can also be put into a difficult position 

362 Vance v. Department of Interior, 114 M.S.P.R. 679, ¶¶ 16 (2010). The parties later entered into yet another settlement 

agreement. Vance v. Department of the Interior, 119 M.S.P.R. 275 at 3-4 (2013) (NP). As of June 2013, the report on the OIG’s 

website has the repeated use of the letter “X” in place of the appellant’s name and notes that the individual’s identity has been 

“redacted due to a 2010 settlement agreement.” Department of the Interior, Office of Inspector General, Semiannual Report to 

the Congress, at 40, October 2008, available at http://www.doi.gov/oig/reports/upload/SemiannualOct2008revision.pdf.

363 Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 12 (2012).

364 Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 3 (2012).

365 Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 3 (2012).

366 Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 4 (2012).

367 Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 4 (2012).

368 Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 12 (2012).

369 Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 13 (2012).

370 Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574 (2012) (dissenting opinion, Robbins, ¶ 5).
52 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

when they are asked about their own record.371 “The Declaration for Federal Employment 

Optional Form (OF) 306 is completed by applicants who are under consideration for 

Federal or Federal contract employment.”372 On the OF-306, Question 12 asks:

During the last 5 years, have you been fired from any job for any reason, 

did you quit after being told that you would be fired, did you leave 

any job by mutual agreement because of specific problems, or were 

you debarred from Federal employment by the Office of Personnel 

Management or any other Federal agency?373

The Questionnaire for Public Trust Positions (SF-85P) asks if the individual has been 

fired, quit after being told he or she would be fired, left under mutual agreement following 

allegations of misconduct or unsatisfactory performance, or under other “unfavorable 

circumstances.”374 The Questionnaire for National Security Positions (SF-86) goes further, 

inquiring about written warnings, reprimands, suspensions or other discipline.375 

We asked OPM what answer an individual should give on the OF-306 if the person has, 

in the preceding 5 years, signed a CRA by which a removal for cause was changed to a 

371 Office of Personnel Management, OF-306, Declaration for Federal Employment, question 12, available at http://www.

opm.gov/forms/. 

372 U.S. Office of Personnel Management, “Submission for Review: Declaration for Federal Employment, OF 306,” 75 

Fed. Reg. 20399 (Apr. 19, 2010) (internal punctuation omitted). See 59 Fed. Reg. 65086 (Dec. 16, 1994) (“Before anyone can be 

appointed or converted to a new appointment in the competitive service, the excepted service, or the Senior Executive Service, 

he or she must execute a Declaration for Federal Employment. In addition, the form may be needed in position changes, for 

example, for agency determinations concerning nepotism and for OPM background investigations”); Office of Personnel 

Management, Delegated Examining Operations Handbook, 2007, at 79, available at http://www.opm.gov/deu/ (explaining that 

the use of this form is mandatory for new appointments under competitive examining).

373 Office of Personnel Management, OF-306, Declaration for Federal Employment, question 12. Private sector employers 

may ask a similar question. See David P. Willis, Jobs Experts: Being Honest If You’re Fired, Daily Record (Morristown, NJ), Mar. 26, 

2011.

374 SF-85P, Question 12, available on line at http://www.opm.gov/forms/. The form requires the individual to assert that 

the statements on the form are “true, complete, and correct” and warns that a “knowing and willful false statement” can result 

in a fine or imprisonment under 18 U.S.C. § 1001. Id. In United States v. Ahmed, 472 F.3d 427, 431, 433, 436 (6th Cir. 2006), the 

court upheld a sentence of 18 months of imprisonment for an individual who made a false statement on the SF-85P regarding 

the terms of his separation from an employer and an additional false statement in response to a question on the form regarding 

the revocation of a past security clearance. 

375 SF-86, Question 13C, available on line at http://www.opm.gov/forms/. Clean record agreements can have a 

consequence for the effectiveness of security clearance checks even when the individual does not return to Federal service. In 

a recent article, the Federal Times discussed a situation involving an individual who was permitted to resign with a clean record 

“after an internal probe found he’d [allegedly] run up tens of thousands of dollars in dubious government credit card charges, 

violated weapons laws and obstructed an internal affairs investigation[.]” Jim McElhatton, CBP secret deal to bury investigator’s past 

misconduct questioned, Jul. 7, 2013, available at http://www.federaltimes.com/article/20130707/ACQUISITION03/307070009/

CBP-secret-deal-bury-investigator-s-past-misconduct-questioned. According to the article, a few months later the individual 

“applied for – and received – a contract investigator job vetting top secret government clearances.” Id. The individual was later 

charged with 23 counts of false statements involving top secret clearance investigations. Id. 
A Report by the U.S. Merit Systems Protection Board 53

External Restrictions on the Effect of CRA

resignation.376 OPM responded that the individual must respond “yes” to Question 12 

and noted a case in which the Board upheld OPM’s decision to bar an individual from 

Federal employment because he answered “no” to a similar question on the SF-86 despite 

the fact that he had left a position by mutual agreement.377

As mentioned in OPM’s response to our questionnaire, and as described in the cases below, 

when an appellant departs an agency under the terms of a mutual agreement, the agreement does not relieve the appellant of the obligation to be candid when asked about the 

circumstances under which the appellant departed past employment—particularly when 

asked if the departure was by mutual agreement.378

The Federal Circuit has noted that, when an appellant signs a CRA, one of the appellant’s 

goals is often to eliminate the negative information that may “affect future employment 

with the government[.]”379 Several of the appellant attorneys we spoke with indicated 

that the primary reason why appellants seek clean records is to aid them in their efforts to 

obtain another Federal position. However, 80 percent of the respondents to our agency 

representative survey agreed with the statement: “Appellants/employees who enter into 

clean record agreements may have an unrealistic idea of how well their past can be kept a 

secret.”380

In Pappas v. Office of Personnel Management, the appellant left employment with the New 

York State Police (NYSP) as a result of a “mutual agreement” between the employer and 

the appellant “that he should resign after allegations of unsatisfactory performance” rather

376 U.S. Office of Personnel Management, Response to MSPB Questionnaire for OPM Regarding Clean Record Settlement Agreements, 

Oct. 9, 2012, Question 2(a) at 3.

377 U.S. Office of Personnel Management, Response to MSPB Questionnaire for OPM Regarding Clean Record Settlement Agreements, 

Oct. 9, 2012, Question 2(a) at 3; Pappas v. Office of Personnel Management, 76 M.S.P.R. 152 (1997). See also Riggsbee v. Office of Personnel 

Management, 111 M.S.P.R. 129, ¶¶ 2, 11 (2009) (removal and debarment were appropriate for a false statement in response to 

question 12); Wolfbauer v. Office of Personnel Management, 283 Fed. App’x 803, 804-05 (Fed. Cir. 2008) (NP) (upholding removal for 

a false statement on question 12).

378 U.S. Office of Personnel Management, Response to MSPB Questionnaire for OPM Regarding Clean Record Settlement Agreements, 

Oct. 9, 2012, Question 2(a) at 3. See, e.g., Horton v. Nicholson, 435 F. Supp. 2d 429, 436-37 (E. D. Pa. 2006) (finding the appellant 

“lied” when he answered no to question 12 after settling an earlier EEO case with a resignation in lieu of a termination, and 

that the “lie” was a legitimate reason for his new agency to remove him); Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 

161 (1997) (the appellant was obligated to report that he had left a position by mutual agreement and failure to disclose this was 

grounds for removal and debarment); Forma v. Department of Justice, 57 M.S.P.R. 97, 105 (1993) (removal was appropriate for a 

failure to disclose that the appellant left a job by mutual agreement). See also Harrison v. Department of Agriculture, 411 F. App’x 312, 

315 (Fed. Cir. 2010) (NP). In Harrison, the court found that the appellant was obligated to answer truthfully a question about 

her departure from her prior agency. Id. Accordingly, her removal by her new agency for, among other things, making a false 

statement regarding her departure was affirmed. Id. 

379 King v. Department of the Navy, 130 F.3d 1031, 1033 (Fed. Cir. 1997).

380 See Appendix B, Question 8.
54 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

than “face possible termination proceedings for unsatisfactory performance.”381 He applied 

for a position as a Border Patrol Agent.382 The appellant was asked the following questions:

During the last 10 years, were you fired from any job for any reason, did 

you quit after being told that you would be fired, or did you leave by 

mutual agreement because of specific problems?383

Has any of the following happened to you in the last 15 years? (1) Fired 

from a job; (2) Quit a job after being told you’d be fired; (3) Left a job by 

mutual agreement following allegations of misconduct; (4) Left a job by 

mutual agreement following allegations of unsatisfactory performance; 

[or] (5) Left a job for other reasons under unfavorable circumstances.384

In his response to these questions, the appellant failed to disclose the circumstances 

surrounding his resignation.385 OPM debarred the appellant from Federal employment for 

three years for his “deception or fraud” in the examination process.386 

The Board found that under the facts of the case, “the appellant reasonably should have 

known that he had left his NYSP job under unfavorable circumstances, and it was not 

reasonable for him” to fail to disclose it.387 The Board explained that a failure to disclose 

information in response to a question on an SF-86, coupled with the lack of a plausible 

explanation for that failure, warranted an inference of an intent to deceive.388 The Board 

found that the appellant’s falsification offense was enough by itself to uphold the debarment 

because it directly implicated his honesty and fitness for employment.389

In Forma v. Department of Justice, the appellant left an employer who documented his 

departure as follows: 

381 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 159 (1997).

382 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 154 (1997).

383 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 155 (1997).

384 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 155-56 (1997).

385 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 155-56 (1997).

386 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 155 (1997).

387 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 159 (1997).

388 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 160 (1997).

389 Pappas v. Office of Personnel Management, 76 M.S.P.R. 152, 161 (1997). The penalty imposed for an inaccurate response 

on the OF-306 will depend, in part, on whether the offense was intentional, technical, or inadvertent. See Douglas v. Veterans 

Administration, 5 M.S.P.R. 280, 305 (1981). In response to our questionnaire, OPM clearly expressed that if an individual has 

been removed for cause and later enters into a settlement agreement, the answer to the OF-306 question 12 should be “yes.” 

U.S. Office of Personnel Management, Response to MSPB Questionnaire for OPM Regarding Clean Record Settlement Agreements, Oct. 9, 

2012, Question 2(a) at 3. However, OPM also noted in its questionnaire response that “whether a misstatement or omission in 

response to this question is intentional requires a separate, individualized assessment.” Id. 
A Report by the U.S. Merit Systems Protection Board 55

External Restrictions on the Effect of CRA

We agree that there is a mismatch between your interests and strengths 

and the requirements of your current position that makes it unlikely that 

you will be content or successful in the job. Therefore, as we agreed, 

your last day of work will be August 3, 1990 and you will be coded as 

an involuntary termination. The ‘Remarks’ section of your records will 

reflect this mismatch.390

The appellant applied for a position with the Department of Justice but failed to report 

on his application and security questionnaires that he had been fired, left a job by mutual 

agreement due to specific problems, or under other unfavorable circumstances.391 The 

appellant was removed for falsifying these forms.392 On appeal, the Board found that the 

appellant was required to answer “yes” to the questions about leaving a job by mutual 

agreement because the appellant did not dispute there was an agreement that he would 

leave the old employer and the “mismatch” was a specific problem.393 The Board found 

that the appellant had deliberately given incorrect responses to the questions on OPM’s 

forms with the intent to deceive the DOJ.394 Accordingly, the Board upheld the appellant’s 

removal.395

An appellant also cannot avoid disclosure by failing to mention past employers.396 In Hanker 

v. Department of the Treasury, the appellant was required to list his previous employers on 

the SF-86 but omitted two employers from the list.397 Under its delegated suitability 

authority, the agency found that this failure to disclose made the appellant unsuitable for 

the position.398 The Board agreed and upheld the agency’s decision.399 

In Ly v. Department of the Treasury, the appellant was discharged from two different 

employers and was not eligible for rehire with either.400 The appellant was removed for 

390 Forma v. Department of Justice, 57 M.S.P.R. 97, 99-100 (1993).

391 Forma v. Department of Justice, 57 M.S.P.R. 97, 99 (1993).

392 Forma v. Department of Justice, 57 M.S.P.R. 97, 99 (1993).

393 Forma v. Department of Justice, 57 M.S.P.R. 97, 103 (1993).

394 Forma v. Department of Justice, 57 M.S.P.R. 97, 104-05 (1993).

395 Forma v. Department of Justice, 57 M.S.P.R. 97, 105 (1993); see also Horton v. Nicholson, 435 F. Supp. 2d 429, 436-37 (E.D. Pa. 

2006) (finding the appellant “lied” when he answered no to question 12 after settling an earlier EEO case with a resignation in 

lieu of a termination, and that the “lie” was a legitimate reason for his new agency to remove him).

396 See Ly v. Department of the Treasury, 118 M.S.P.R. 481, ¶ 16 (2012) (upholding removal for failure to disclose past 

employers); Hanker v. Department of the Treasury, 73 M.S.P.R. 159, 168 (1997) (upholding removal for failure to disclose past 

employers). 

397 Hanker v. Department of the Treasury, 73 M.S.P.R. 159, 161 (1997).

398 Hanker v. Department of the Treasury, 73 M.S.P.R. 159, 161, n.1 (1997).

399 Hanker v. Department of the Treasury, 73 M.S.P.R. 159, 168 (1997).

400 Ly v. Department of the Treasury, 118 M.S.P.R. 481, ¶¶ 2-3 (2012).
56 Clean Record Settlement Agreements And The Law

External Restrictions on the Effect of CRA

failure to disclose each of these discharges on her OF-306.401 The appellant appealed the 

removal and penalty.402 In its decision, the Board noted that it “has consistently held that 

the penalty of removal for falsification of government employment documents is within 

the bounds of reasonableness because such falsification raises serious doubts regarding the 

appellant’s honesty and fitness for employment” and upheld the removal.403 

We asked appellant attorneys what they tell individuals to do in this situation and what 

they think most people actually do.404 Several attorneys told us that they advise clients to 

explain what really happened because of the risk that the clients might later be removed 

for lack of candor. However, multiple attorneys also stated that they think that most 

people will not make the disclosure. One appellant attorney admitted that, with respect to 

answers provided on the OF-306, “I think there is a lot of game playing that is probably 

happening.” 

401 Ly v. Department of the Treasury, 118 M.S.P.R. 481, ¶ 2 (2012).

402 Ly v. Department of the Treasury, 118 M.S.P.R. 481, ¶¶ 6, 8 (2012).

403 Ly v. Department of the Treasury, 118 M.S.P.R. 481, ¶ 16 (2012).

404 For more on the methodology by which this data was collected, see Appendix A.
A Report by the U.S. Merit Systems Protection Board 57

CONCLUSION

Clean record settlement agreements are a complex area of the law. The question of whether 

a breach has occurred depends heavily on the specific promises made in the CRA and the 

particular facts of a case in which breach is alleged. Additionally, external forces beyond 

the control of the contracting parties can determine whether the confidentiality provisions 

in the agreement are enforceable and whether the parties can get what they intended to get 

out of the agreement.

Public policy favors settlement agreements to avoid unnecessary litigation and to encourage 

fair and speedy resolution of issues. The Board favors settlement agreements that are 

consistent with law, equity, and public policy. 

The Federal Circuit has noted, regarding CRAs, that “[t]he Board has a difficult job 

sorting through some of these enforcement agreements, particularly those that are not 

well-drafted, but. . . it is the Board’s job to see to it that the parties receive that for which 

they bargained.”405 Once parties have entered into a CRA, the Board will hold them 

responsible for meeting their obligations regardless of any difficulty in accomplishing those 

tasks.406 Applying the lessons contained in the cases discussed in this report may help 

parties to improve the drafting of such agreements and to form realistic expectations about 

the benefits that they can expect to receive, while at the same time helping the Board and 

its reviewing court to enforce those agreements consistent with the parties’ intent.

405 Pagan v. Department of Veterans Affairs, 170 F.3d 1368, 1372 (Fed. Cir. 1999). 

406 Poett v. Department of Agriculture, 98 M.S.P.R. 628, ¶ 19 (2005).
58 Clean Record Settlement Agreeements and the Law
A Report by the U.S. Merit Systems Protection Board 59

APPENDIX A: 

METHODOLOGY DETAILS

The sources of information that were used in this report or that influenced this report 

include: case law, a survey of agency representatives, questionnaires completed by MSPB 

AJs regarding cases, a review of a sample of settlement agreements containing a clean record 

provision, a questionnaire sent to OPM, a questionnaire for unions and management 

associations, and interviews of appellant attorneys. Several of these sources of information 

are described in greater depth below. 

Agency Representatives’ Survey:

We identified 1,193 individuals who appeared before MSPB as an agency representative 

from May 1, 2011 to April 30, 2012 in an adverse action case.407 We contacted this 

population by letter and then sent e-mail reminders to those individuals for whom we had 

an e-mail address. We received 621 responses, for a response rate of 52 percent. 

In order to capture data relevant to the management of the civil service as a whole, this 

survey asked respondents to include their “experiences with settlement agreements for 

potential EEO complaints or union/administrative grievances as well as actions appealable 

to MSPB.” As a result, while we identified the agency representative survey respondents 

through their past appearance before MSPB, this data should not be read to apply only to 

cases before MSPB. Furthermore, responses of “don’t know” or “not applicable” have been 

removed from the discussion of data from this survey in order to show only responses of 

those who had experience with the issue at hand or were in a position to form an opinion. 

See Appendix B for the full list of questions and responses. 

AJ Questionnaires:

MSPB AJs were asked to answer questionnaires about certain outcomes in cases (such as 

the use of a clean record settlement agreement). For the AJ data, the response rate may be 

measured against docket numbers for a given fiscal year. We utilized data from case docket 

numbers that began in FY 2007-FY 2011. Overall, the response rate from the AJs was 

61.5 percent. 

407 By statute, MSPB has the authority to survey Federal employees. 5 U.S.C. § 1204(e)(3). Because we do not have a 

similar authority for former employees, and because such individuals are less likely to be able to address concepts across multiple 

cases, we did not survey appellants.
60 Clean Record Settlement Agreements And The Law

Appendix A

Settlement Agreement Reviews:

We reviewed 50 settlement agreements that were submitted to the Board for inclusion in a 

case record for the purpose of enforceability. Due to the costs and administrative burden 

involved in requesting individual, paper case files from the National Archives and Records 

Administration, we reviewed only settlement agreements contained in MSPB’s electronic 

filing system. We reviewed such agreements for a random selection of cases filed in FY 

2010-2011.

Other Sources:

We provided OPM with a written list of open-ended questions. We also wrote to nine 

organizations that represent Federal or U.S. Postal Service employees or supervisors and 

invited them to respond to a list of questions. Six organizations responded. Finally, we 

interviewed by telephone attorneys from seven private sector law firms who frequently 

appear before the Board on behalf of appellants.
A Report by the U.S. Merit Systems Protection Board 61

APPENDIX B: AGENCY 

REPRESENTATIVE SURVEY

Dear Agency Representative:

Thank you for responding to the notification that we sent to you! As we explained, in 

accordance with 5 U.S.C. § 1204, we are currently conducting a study about settlement 

agreements in which an agency agrees to modify or “clean” an individual’s record as 

a material term of the agreement. A report from this study will be prepared for the 

President and the Congress and distributed to other Federal officials. 

Your response to this survey is voluntary and will be kept strictly confidential. The data 

will be reported only in the aggregate and no individuals will be identified. Only MSPB 

staff and our survey host will have access to the surveys and no personal information 

about respondents has been disclosed to the host. Our survey is brief, and should take 

less than 15 minutes to complete. 

In response to our questions, please include your experiences with settlement agreements 

for potential EEO complaints or union/administrative grievances as well as actions 

appealable to MSPB. For convenience, the term “appellant” or “employee” may be used 

throughout this survey to refer the individual with whom you may negotiate such an 

agreement. 

Thank you for your participation!408

408 This survey was administered electronically. While the content below is consistent with the survey that was provided 

to agency representatives, the layout is different. The below also includes responses of “don’t know” or “not applicable,” 

even though these responses were removed from the body of this report to assist with the discussion of views held by those 

respondents with opinions. Narrative responses are not provided.
62 Clean Record Settlement Agreements And The Law

Appendix B

4. Which of the following best describes your role in 

settlement agreements with employees or appellants?

 4.7%

I often or always have the 

authority to decide what the 

agency will agree to do.

92.3%

I often or always have 

the authority to make 

recommendations but someone 

else usually decides what the 

agency will agree to do.

 0.6%

I am rarely involved in 

recommendations or decisions 

for settlement agreements.

 2.5% Other

Please indicate your level of agreement or 

disagreement with each of the following 

statements:

5. Clean record agreements are often the only way to 

get an appellant/employee to agree to settle.

18.8% Strongly Agree

54.7% Somewhat Agree

17.4% Somewhat Disagree

 7.3% Strongly Disagree

 1.8% Not Applicable/ Don’t Know

6. I consider the seriousness of the appellant’s/employee’s 

conduct when deciding whether to recommend/agree 

that the agency will clean a record that documents 

misconduct.

66.5% Strongly Agree

27.9% Somewhat Agree

 3.6% Somewhat Disagree

 1.0% Strongly Disagree

 1.0% Not Applicable/ Don’t Know

1. During the past 3 years, in approximately 

how many settlement agreements for adverse 

personnel actions have you had a role? (This 

includes drafting, reviewing, advising upon, or 

signing the agreement.)

 5.0% None

26.5% 1-3

21.5% 4-6

19.3% 7-10

7.4% 11-15

20.2% More than 15

2. Approximately what percentage of these 

settlement agreements included a commitment 

that the agency will clean any of its records or 

modify/limit what it states in response to reference 

checks?

11.1% None

23.3% 1-15 percent

16.6% 16-30 percent

18.4% 31-50 percent

12.7% 51-75 percent

17.8% More than 75 percent

3. Why haven’t you recommended/approved any 

clean record agreements? (Select all that apply.)

57.6% The issue has never come 

up.

10.6% I don’t think cleaning 

records to reach a 

settlement is in the public 

interest.

 3.0% Human resources staff 

oppose clean record 

agreements.

 6.1% Management opposes clean 

record agreements.

21.2% It is not practical to reach 

such an agreement because 

it is too hard for the agency 

to meet its end of the 

bargain.

15.2% None of the above.

13.6% Other
A Report by the U.S. Merit Systems Protection Board 63

Appendix B

7. I have been involved in an agreement where 

the agency changed the type of action taken or 

the reason for the action in order to potentially 

assist the individual to obtain Government 

benefits. (Examples of such benefits include, but 

are not limited to, workplace injury compensation, 

retirement, social security, or unemployment 

benefits.)

15.1% Strongly Agree

27.0% Somewhat Agree

12.5% Somewhat Disagree

29.4% Strongly Disagree

16.1% Not Applicable/ Don’t Know

8. Appellants/employees who enter into clean 

record agreements may have an unrealistic idea of 

how well their past can be kept a secret.

29.2% Strongly Agree

40.8% Somewhat Agree

13.5% Somewhat Disagree

 4.0% Strongly Disagree

12.5% Not Applicable/Don’t Know

9. When I recommend/agree to a clean record it 

is often because I think the agency should not risk 

losing the case on a legal technicality.

12.7% Strongly Agree

37.3% Somewhat Agree

27.8% Somewhat Disagree

18.1% Strongly Disagree

 4.2% Not Applicable/Don’t Know

10. When I recommend/agree to a clean record it 

is often because I think the appellant/employee did 

not engage in the charged conduct or performance 

deficiency.

 2.0% Strongly Agree

 6.7% Somewhat Agree

21.2% Somewhat Disagree

66.1% Strongly Disagree

 4.0% Not Applicable/Don’t Know

11. When I recommend/agree to a clean record it is 

often because I think litigating the case will take up 

more time or money than the litigation would be worth 

to the agency.

29.7% Strongly Agree

47.7% Somewhat Agree

12.3% Somewhat Disagree

 8.7% Strongly Disagree

 1.6% Not Applicable/ Don’t Know

12. Clean record agreements between agencies and 

appellants/employees are usually in the interest of the 

agency.

12.6% Strongly Agree

48.7% Somewhat Agree

26.5% Somewhat Disagree

10.2% Strongly Disagree

 2.0% Not Applicable/ Don’t Know

13. Clean record agreements between agencies and 

appellants/employees are usually in the interest of the 

appellant/employee.

46.7% Strongly Agree

47.3% Somewhat Agree

 3.8% Somewhat Disagree

0.6% Strongly Disagree

 1.6% Not Applicable/ Don’t Know

14. Clean record agreements between agencies and 

appellants/employees are usually in the interest of the 

general public.

4.4% Strongly Agree

32.3% Somewhat Agree

34.1% Somewhat Disagree

19.0% Strongly Disagree

10.2% Not Applicable/ Don’t Know
64 Clean Record Settlement Agreements And The Law

Appendix B

15. I consider myself knowledgeable about MSPB and 

court decisions regarding the interpretation of clean 

record agreements.

27.7% Strongly Agree

59.8% Somewhat Agree

 8.6% Somewhat Disagree

 1.8% Strongly Disagree

 2.0% Not Applicable/Don’t Know

16. Before entering into a clean record agreement, I 

consult with someone from human resources.

60.3% Strongly Agree

26.5% Somewhat Agree

 6.6% Somewhat Disagree

 3.2% Strongly Disagree

 3.4% Not Applicable/Don’t Know

17. Before recommending or signing a clean record 

agreement, I perform additional research to determine 

how various clauses in that agreement may be 

interpreted by MSPB or courts.

40.5% Strongly Agree

41.5% Somewhat Agree

12.4% Somewhat Disagree

 3.6% Strongly Disagree

 2.0% Not Applicable/Don’t Know

18. I suspect that many appellants/employees who are 

given clean records go on to be problem employees 

elsewhere.

25.0% Strongly Agree

39.3% Somewhat Agree

15.2% Somewhat Disagree

 3.0% Strongly Disagree

17.6% Not Applicable/Don’t Know

How important to you are the following 

when you decide whether you will recommend/approve or oppose a clean record 

agreement?

19a. Resolving or precluding litigation in other forums 

(such as EEO complaints or union grievances).

65.9% Very Important

26.5% Somewhat Important

 4.6% Slightly Important

 2.6% Not Important

 0.4% Not Applicable/Don’t Know

19b. Finality (eliminating further review such as a 

petition for review or appeal to the Federal Circuit).

68.3% Very Important

23.6% Somewhat Important

 5.4% Slightly Important

 2.0% Not Important

 0.6% Not Applicable/Don’t Know

19c. The costs of continued litigation of the appeal.

50.9% Very Important

33.4% Somewhat Important

10.9% Slightly Important

 4.6% Not Important

 0.2% Not Applicable/Don’t Know

19d. The penalty’s result remains in effect (e.g., 

termination of the employment relationship).

67.5% Very Important

24.0% Somewhat Important

 5.6% Slightly Important

 1.2% Not Important

 1.6% Not Applicable/Don’t Know
A Report by the U.S. Merit Systems Protection Board 65

Appendix B

19e. Preventing future employment with the office, 

agency or other identified employer(s).

56.3% Very Important

30.2% Somewhat Important

10.5% Slightly Important

2.2% Not Important

0.8% Not Applicable/Don’t Know

19f. Your (or management’s) desire to provide the 

individual with the best chance for future employment 

or benefits.

4.8% Very Important

24.1% Somewhat Important

35.1% Slightly Important

33.9% Not Important

2.0% Not Applicable/Don’t Know

19g. The individual’s desire to have the best chance for 

future employment or benefits.

11.2% Very Important

28.5% Somewhat Important

32.1% Slightly Important

26.5% Not Important

1.8% Not Applicable/Don’t Know

9h. The ability of agency officials to be candid about 

the individual in the future.

24.4% Very Important

39.8% Somewhat Important

21.0% Slightly Important

12.7% Not Important

2.0% Not Applicable/Don’t Know

19i. Agency records will reflect the truth.

32.2% Very Important

36.9% Somewhat Important

19.8% Slightly Important

8.1% Not Important

3.1% Not Applicable/Don’t Know

19j. Ensuring that the agency can comply with the 

terms of the agreement.

89.0% Very Important

9.1% Somewhat Important

1.0% Slightly Important

0.2% Not Important

0.6% Not Applicable/Don’t Know

19k. Ensuring that the individual can comply with the 

terms of the agreement.

48.9% Very Important

28.0% Somewhat Important

14.4% Slightly Important

7.3% Not Important

1.4% Not Applicable/Don’t Know

19l. The potential consequences for other employers in 

the future.

20.0% Very Important

37.2% Somewhat Important

28.9% Slightly Important

12.3% Not Important

1.6% Not Applicable/Don’t Know
66 Clean Record Settlement Agreements And The Law

Appendix B

20. Have you recommended or approved a clean 

record agreement which prohibited the individual from 

applying for—or being employed with—a particular 

office or agency?

81.6% Yes

15.8% No

2.6% Don’t Know or Not Applicable

21. Why did the agency include the condition that the 

individual could not work for the office or agency?

Narrative Text Box

22. What do you think are the most common or 

avoidable mistakes made by parties regarding clean 

record agreements?

Narrative Text Box

23. What have you done with respect to clean record 

agreements that you think worked well that others 

should consider doing?

Narrative Text Box

24. What other benefits are there to using clean record 

agreements that were not addressed in this survey?

Narrative Text Box

25. What other drawbacks are there to using clean 

record agreements that were not addressed in this 

survey?

Narrative Text Box

26. Is there anything else that you would like to tell us 

about clean record agreements?

Narrative Text Box
A Report by the U.S. Merit Systems Protection Board 67

APPENDIX C: LEGAL 

TERMINOLOGY

There are a few legal terms used frequently in this report that are central to understanding 

CRAs.

CRAs are contracts.409 The promises being made in the contract are called consideration.

410

Consideration can be an obligation regarding a physical thing (like money), or it can be 

the performance of an act (such as withdrawing an appeal or providing a certain type of 

reference in the future).411 To be valid, a contract must have mutual consideration, which 

means each side must promise to do something or to refrain from doing something that 

the party had a right to do.412

In contract law, a breach means a party failed to meet its contractual obligations.413 A 

breach of a settlement agreement is material when it relates to a matter of vital importance 

or goes to the essence of the contract.414 When one party commits a material breach of a 

409 See Greco v. Department of the Army, 852 F.2d 558, 560 (Fed. Cir. 1988); McGriff v. Department of the Navy, 118 M.S.P.R. 89, 

¶ 20 (2012). 

410 Consideration is “something having value in the eye of the law. It may consist either in some right, interest, profit, 

or benefit accruing to one party, or some forbearance, detriment, loss, or responsibility given, suffered, or undertaken by the 

other[.]” Kemp v. National Bank, 109 F. 48, 52 (4th Cir. 1901). “A consideration consists of some benefit or advantage accruing 

to the promisor, or of some loss or disadvantage incurred by the promisee. A consideration is an essential ingredient to the 

legal existence of every simple contract.” Eastman v. Miller, 85 N.W. 635, 636 (Iowa 1901). “It is not essential that the person to 

whom the consideration moves should be benefited, provided the person from whom it moves is, in a legal sense, injured. The 

injury may consist of a compromise of a disputed claim or forbearance to exercise a legal right, the alteration in position being 

regarded as a detriment that forms a consideration independent of the actual value of the right forborne.” Rector, Church Wardens 

& Vestrymen v. Teed, 24 N.E. 1014, 1015 (N.Y. 1890).

411 See Kemp v. National Bank, 109 F. 48, 52 (4th Cir. 1901); Eastman v. Miller, 85 N.W. 635, 636 (Iowa 1901); Rector, Church 

Wardens & Vestrymen v. Teed, 24 N.E. 1014, 1015 (N.Y. 1890).

412 See Corbin on Contracts, Mutuality of Obligation, Mutuality of Consideration, § 6.1, LexisNexis, 2013; Ballentine’s Law 

Dictionary, Consideration, LexisNexis, 2010. 

413 See Lujan v. G and G Fire Sprinklers, 532 U.S. 189, 198 (2001) (one way that breach has been defined is the “‘unjustified 

or unexcused failure to perform’ contractual duties); Klay v. Humana, Inc., 382 F.3d 1241, 1263 (11th Cir. 2004) (quoting Black’s 

Law Dictionary 200 (8th ed. 2004), defining “breach of contract” as “violation of a contractual obligation by failing to perform 

one’s own promise”); Restatement 2d of Contracts, § 235 (“[w]hen performance is due. . . anything short of full performance is a 

breach”).

414 “A breach is material when it relates to a matter of vital importance, or goes to the essence of the contract.” Thomas v. 

Department of Housing & Urban Development, 124 F.3d 1439, 1442 (Fed. Cir. 1997) (citing 5 Arthur L. Corbin, Corbin on Contracts § 

1104 (1964)). An appellant is not required to show actual harm to establish that an agency’s disclosure of information covered 

by the agreement constitutes a material breach. Doe v. Department of the Army, 116 M.S.P.R. 160, ¶ 10 (2011). Thus, an appellant 

need not show that a disclosure resulted in a lost job opportunity or other harm in order to prevail in litigation over whether the 

agency breached a CRA. See Allison v. Department of Transportation, 111 M.S.P.R. 62, ¶ 17 (2009); Poett v. Department of Agriculture, 98 

M.S.P.R. 628, ¶ 17 (2005).
68 Clean Record Settlement Agreements And The Law

Appendix C

settlement agreement that was put into MSPB’s record for enforcement purposes, the other 

party is entitled either to enforce the settlement agreement or to rescind it and reinstate the 

underlying appeal.415

A mutual mistake of fact or law tends to bring about a similar result.416 A mutual mistake 

occurs if, at the time that the contract is formed, both parties operate from an erroneous 

assumption that has a material effect on what the parties have agreed to do.417 This can 

include an erroneous assumption about the facts or about what the parties are able to do by 

law.418 For example, the parties may be mutually mistaken about an individual’s eligibility 

for a retirement pension, and such eligibility can be a major consideration for parties when 

assessing whether to enter into a particular settlement agreement.419 When a settlement 

agreement is based on a mutual mistake about a material fact in existence at the time of the 

agreement, or a law permitting the implementation of a material provision of the agreement, then the agreement may be set aside by the Board.420 

If an allegation of breach or mutual mistake is proven, then the agreement as a whole 

is lost, as if it had never been put into effect at all and the parties are freed from their 

contractual obligations.421 This cancellation of the contract is called rescission.

422 When 

rescission occurs, the parties are back where they started, although time will have passed.423

415 See Lutz v. U.S. Postal Service, 485 F.3d 1377, 1381, n.2 (Fed. Cir. 2007); Kitt v. Department of the Navy, 116 M.S.P.R. 680, 

¶¶ 11-12 (2011).

416 See Garcia v. Department of the Air Force, 83 M.S.P.R. 277, ¶ 7 (1999) (a settlement agreement may be avoided if it was based 

on a mutual mistake of material fact); Potter v. Department of Veterans Affairs, 111 M.S.P.R. 374, ¶ 9 (2009) (settlement agreement 

must be set aside if it is tainted with invalidity by a mutual mistake of law under which both parties acted).

417 The famous case used to teach this principle to law students is Sherwood v. Walker, 33 N.W. 919 (Mich. 1887), in which an 

agreement was reached to sell a specific barren cow. However, it turned out to be possible that the cow could get pregnant. As 

the deal was for a barren cow, if the cow named in the deal was not barren then the parties had been mutually mistaken about 

the consideration named in the deal (the cow) and the contract was voidable. See also Black’s Law Dictionary 1017 (7th Ed. 1999) 

(mutual mistake is a mistake that is shared and relied on by both parties to a contract; mistake of fact is a mistake about a fact 

that is material to a transaction; mistake of law is a mistake about the legal effect of a known fact or situation).

418 See Garcia v. Department of the Air Force, 83 M.S.P.R. 277, ¶¶ 11, 15 (1999) (discussing how a mutual mistake of fact led to a 

mutual mistake of the lawfulness of a material provision of the agreement, resulting in the agreement being set aside).

419 Compare Thomas v. United States Postal Service, 87 M.S.P.R. 512, ¶ 10 (2001) (raising the possibility of setting aside the 

contract if both parties were mistaken about the appellant’s eligibility for disability retirement because of her years of service) 

with Farrero v. National Aeronautics & Space Administration, 83 M.S.P.R. 487, ¶¶ 7-9 (1999) (explaining that because the agreement 

stated that “nothing in this Settlement Agreement warrants that Appellant will receive any retirement or other benefit[,]” the 

appellant’s entitlement to a retirement was not a fact about which a mutual mistake could have been formed). 

420 See Thomas v. United States Postal Service, 87 M.S.P.R. 512, ¶ 10 (2001) (addressing mutual mistakes of fact); Adkins v. United 

States Postal Service, 86 M.S.P.R. 671, ¶ 9 (2000) (addressing mutual mistakes of law); see also Garcia v. Department of the Air Force, 83 

M.S.P.R. 277, ¶¶ 11, 15 (1999) (discussing how a mutual mistake of fact led to a mutual mistake of the lawfulness of a material 

provision of the agreement, resulting the in the agreement being set aside). 

421 See Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 14 (2012) (explaining that if the agreement is rescinded, 

the settlement terms become inoperative, and the parties are essentially restored to the status quo ante). 

422 See Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶ 14 (2012).

423 See Zumwalt v. Department of Veterans Affairs, 118 M.S.P.R. 574, ¶¶ 3, 14 (2012) (finding in 2012 that the appellant may 

reinstate his 2009 appeal).
A Report by the U.S. Merit Systems Protection Board 69

Appendix C

Portions of this report discuss the interaction between contracts and public policy. Public 

policy is the relationship between the public interest and the law.424 Public policy has been 

described as:

[T]hat principle of law which holds that no subject or citizen can 

lawfully do that which has a tendency to be injurious to the public or 

against the public good. . . . But it is also a well-established principle of 

law and public policy, that where a person is engaged in. . . legitimate 

pursuits, he shall not be unreasonably fettered in the exercise of such 

[pursuits.]”425

424 See Advance-Rumely Thresher Co. v. Jackson, 287 U.S. 283, 288 (1932) (when contract “enforcement conflicts with dominant 

public interests” it is contrary to public policy and a party will therefore not be held to his contractual promise).

425 Consumers’ Oil Co. v. Nunnemaker, 41 N.E. 1048, 1050 (Ind. 1895) (punctuation modified). The U.S. Supreme Court has 

stated that “the public interest can never be promoted by encouraging unfair, inequitable or dishonorable practices[.]” Int’l News 

Serv. v. AP, 248 U.S. 215 (1918).
70 Clean Record Settlement Agreements And The Law
A Report by the U.S. Merit Systems Protection Board 71

APPENDIX D: ADDITIONAL 

INFORMATION ABOUT 

OFFICIAL PERSONNEL FILES

The Official Personnel Folder is the central repository for Notifications of Personnel 

Actions (SF-50s) for a given individual.426 Agencies have been moving from a paper-based 

OPF system to an electronic OPF (e-OPF) system.427 However, regardless of which type 

of OPF is used, OPFs are the property of OPM, although they are in the physical custody 

of an employing agency.428 Therefore, OPM sets the rules for OPFs.429

As explained below, there are some modifications that agencies are authorized to make to 

OPFs, but there are limits to an agency’s power over an OPF.430

Put simply, the civil service was designed to be open and merit-based.431 Processes have 

been crafted around the assumption that the Government should not hide information 

from those with a need to know and that any anomalies will have a reasonable explanation 

that need not be hidden from view.432 Thus, acting in the normal course of business

426 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at 1-7.

427 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at 1-1; see U.S. Office of Personnel Management, 

http://www.opm.gov/policy-data-oversight/data-analysis-documentation/enterprise-human-resources-integration/ (explaining 

that “the Office of Management and Budget (OMB) mandated all Executive Branch agencies eliminate paper Official Personnel 

Folders. . . by December 2013”).

428 5 C.F.R. § 293.303(a).

429 5 C.F.R. § 293.303(e); see U.S. Office of Personnel Management, Guide to Personnel Recordkeeping.

430 See U.S. Office of Personnel Management, Guide to Personnel Recordkeeping.

431 The Pendleton Act that ended the spoils system and created the civil service required the Civil Service Commission 

(CSC) to keep a record of “the persons selected for appointment or employment from among those who have been examined, 

of the place of residence of such persons, of the rejection of any such persons after probation, of transfers, resignations, and 

removals and of the date thereof[.]” Pendleton Act of 1883, § 2-8. Shortly before the duties of the CSC were given to OPM, 

the CSC explained that its system of records contained reprimands and decisions on charges, and that the information could be 

“[u]sed in the selection process by the agency maintaining the record in connection with appointments, transfers/promotions, or 

qualifications determinations. To the extent relevant and necessary, it will be furnished upon request to other agencies for the 

same purpose.” 40 Fed. Reg. 54356, 54361-62, Nov. 21, 1975. This information also could be “[d]isclosed to other Government 

agencies maintaining relevant enforcement or other information if necessary to obtain from these agencies information 

pertinent to decisions regarding hiring or retention.” Id. 

432 See U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at Ch. 6-4. “Requests from the public for 

information from personnel and medical folders must be handled in compliance with both the Privacy Act of 1974, as amended 

(5 U.S.C. 552a) and the Freedom of Information Act (5 U.S.C 552). The Privacy Act restricts access to records in a system 

of records. The Freedom of Information Act establishes the public’s right to information contained in Government records. 

Agencies are authorized to respond to requests for information from the public on all Official Personnel Folders and Employee 

Medical Folders in their possession.” Id. 
72 Clean Record Settlement Agreements And The Law

Appendix D

tends to create a paper trail of events, even if that is not the desire of the agency or the 

employee.433 The OPF or e-OPF will—overtly or discretely—record that a change has 

been made.434 

When an SF-50 is cancelled and replaced by a new notification of a personnel action (such 

as a removal being replaced by a resignation), the personnel office must:

Issue Standard Form 50 with the nature of action, authority, and effective 

date that would have been used if action had been processed properly 

to begin with. Identify in blocks 46-50 the office that processes the 

replacement action, the date it is approved by the appointing official in 

that office, and the title of that official.435

In other words, if an employee is removed and a year later a settlement agreement is 

reached to change the nature of the separation to a resignation, the SF-50 will indicate 

that the resignation SF-50 was approved a year after the effective date of the resignation.436

Similarly, if the agency alters its records to reflect that an individual who was removed 

technically remained employed for a period, any annual increases, within-grade increases, 

or other regularly generated documents may either be missing or display an approval date 

so distant from the effective date as to raise questions in the minds of experienced human 

resources specialists who may one day see the OPF.437

In our questionnaire to OPM, we asked if a difference in the approval and effective dates 

on a SF-50 could be an issue in an investigation.438 OPM replied that, “depending on 

the type of background investigation being conducted, the OPF/e-OPF of the person 

being investigated may be reviewed as part of the investigative process.”439 Additionally, 

“investigators may seek clarification of information contained within the file if the 

information as presented appears to have been altered or revised in some manner.”440

433 See U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at 1-1.

434 See U.S. Office of Personnel Management, Guide to Processing Personnel Actions, Ch. 32-10 (explaining the information 

placed on a notification of personnel action for a cancellation). 

435 U.S. Office of Personnel Management, Guide to Processing Personnel Actions, Ch. 32-10 (emphasis added).

436 See U.S. Office of Personnel Management, Guide to Processing Personnel Actions, Ch. 32-10.

437 See U.S. Office of Personnel Management, Guide to Processing Personnel Actions, Ch. 32-10.

438 U .S. Office of Personnel Management, Response to MSPB Questionnaire for OPM Regarding Clean Record Settlement Agreements, 

Oct. 9, 2012, Question 3(a) at 4.

439 U .S. Office of Personnel Management, Response to MSPB Questionnaire for OPM Regarding Clean Record Settlement Agreements, 

Oct. 9, 2012, Question 3(a) at 4.

440 U .S. Office of Personnel Management, Response to MSPB Questionnaire for OPM Regarding Clean Record Settlement Agreements, 

Oct. 9, 2012, Question 3(b) at 4. 
A Report by the U.S. Merit Systems Protection Board 73

Appendix D

There are indications that, in effectuating CRAs, some agencies may not be following the 

rules set by OPM regarding what OPFs may—and may not—contain. In particular, some 

agencies appear to be placing copies of the settlement agreements inside the appellant’s 

OPF —something expressly prohibited by OPM’s rules for OPFs.441 The Guide to Personnel 

Recordkeeping specifically states that copies of decisions and agreements must not be filed in 

the personnel folder.442

For example, one settlement agreement that we examined as part of the sample of reviewed 

agreements contained the following term:

The Agency will remove all documents referring to any discipline related 

to attendance from the Appellant’s Official Personnel File. However, 

the Agency will be allowed to place a copy of this agreement in a sealed 

envelope in the Appellant’s Official Personnel File marked “To be opened 

only in the event [the appellant] seeks employment or restoration with 

the [agency].”443

This CRA also included the statement that the appellant “agrees that he will not seek 

employment or restoration to employment with the [agency] in the future.”444 This is a 

relatively common CRA provision. Prohibitions on future employment were present in 

more than 40 percent of the CRAs filed with MSPB to settle an initial appeal between FY 

2007 and FY 2011.445 Eighty-four percent of the agency representatives who reported using 

CRAs said they had included this term in one or more of their CRAs.446 In our survey, 

87 percent of agency representatives reported that when they decided to recommend or 

oppose a CRA, it was either very or somewhat important to them that they be able to 

prevent future employment with the office, agency or other identified employer(s).447 

Whatever solution agencies seek to address the challenge of enforcing no return clauses, 

putting a copy of the agreement inside the OPF cannot be the answer—even if the parties 

agree upon it.448 The content of an OPF is not theirs to negotiate.449

441 See U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at 3-24.

442 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at 3-24.

443 For more on the methodology by which this data was collected, see Appendix A.

444 One agreement that we reviewed went so far as to state that the individual could not even be employed as a contractor 

performing duties for the agency. For more on the methodology by which this data was collected, see Appendix A.

445 Data is from a questionnaire given to MSPB administrative judges. For more on the questionnaire, see Appendix A. 

446 See Appendix B, Question 20.

447 See Appendix B, Question 19e.

448 U.S. Office of Personnel Management, Guide to Personnel Recordkeeping, at 3-24.

449 5 C.F.R. § 293.303. 
74 Clean Record Settlement Agreements And The Law
A Report by the U.S. Merit Systems Protection Board 75
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