Court Opinion

ID: 4099899
Source: CourtListenerOpinion
Date Created: 2016-11-18 16:00:09.475493+00
Date Added: 2024-06-11T14:29:43.709150
License: Public Domain

UNITED STATES OF AMERICA
                        MERIT SYSTEMS PROTECTION BOARD
                                        2016 MSPB 39

                              Docket No. AT-0752-14-0058-B-1

                                        Lisa J. Hess,
                                         Appellant,
                                              v.
                               United States Postal Service,
                                          Agency.
                                     November 18, 2016

             Thomas J. Connick, Esquire, Cleveland, Ohio, for the appellant.

             Jason L. Hardy, Esquire, and Margaret L. Baskette, Esquire, Clearwater,
               Florida, for the agency.

                                          BEFORE

                              Susan Tsui Grundmann, Chairman
                                 Mark A. Robbins, Member

                                  OPINION AND ORDER

¶1           This appeal is before us on the administrative judge’s July 22, 2016 order
     certifying for interlocutory review his ruling that the Board lacks the authority to
     award    compensatory    damages    in   discrimination   and   equal   employment
     opportunity (EEO) reprisal claims.        For the reasons discussed below, we
     REVERSE the administrative judge’s ruling, VACATE the order that stayed the
     proceedings below, and RETURN the appeal to the regional office for further
     adjudication consistent with this Opinion and Order.
                                                                                      2

                                      BACKGROUND
¶2           The agency removed the appellant effective September 27, 2013. Hess v.
     U.S. Postal Service, MSPB Docket No. AT-0752-14-0058-I-1, Initial Appeal File
     (IAF), Tab 5 at 65-68. She appealed her removal, and raised affirmative defenses
     of sex and disability discrimination, reprisal for EEO activity, and whistleblower
     reprisal. IAF, Tab 1 at 3, 6; Hess v. U.S. Postal Service, MSPB Docket No.
     AT-0752-14-0058-I-2, Refiled Appeal File (RAF), Tab 18 at 4. Subsequently,
     the agency rescinded the action, removed all references thereto from the
     appellant’s official personnel folder, and retroactively returned her to the nonpay
     status that she occupied prior to her removal. IAF, Tab 26 at 35-36, 56.
¶3           The administrative judge issued an initial decision, dismissing the appeal
     as moot.    RAF, Tab 23, Initial Decision (ID).    In doing so, he found that no
     hearing was necessary concerning the appellant’s affirmative defenses because
     she failed to allege a genuine issue of material fact entitling her to additional
     relief. ID at 4‑20.
¶4           Shortly after the administrative judge issued the initial decision in the
     instant appeal, the Board issued Savage v. Department of the Army, 122 M.S.P.R.
     612 (2015). In Savage, we observed that it is civil service law that defines the
     procedures by which we decide whether a violation of title VII has taken place ,
     including 5 U.S.C. § 7702(a)(1)(B). Id., ¶ 45. Those procedures do not provide
     for summary judgment. Id., ¶ 46 & n.10.
¶5           The appellant petitioned for review of the initial decision.   Hess v. U.S.
     Postal Service, MSPB Docket No. AT-0752-14-0058-I-2, Petition for Review
     File, Tab 1. In an Opinion and Order, we affirmed the administrative judge’s
     finding that the appellant’s removal and her whistleblower reprisal defense were
     moot.      Hess v. U.S. Postal Service, 123 M.S.P.R. 183, ¶¶ 1, 6‑8 (2016).
     However, relying on Savage, 122 M.S.P.R. 612, ¶¶ 45‑46 & n.10, we found that
     the administrative judge erred in dismissing the appellant’s discrimination and
                                                                                      3

     EEO retaliation affirmative defenses without a hearing because the appellant had
     stated cognizable claims. Hess, 123 M.S.P.R. 183, ¶¶ 9-10. We remanded the
     appeal to the regional office for a hearing on these claims. Id., ¶¶ 10-11.
¶6         On remand, the administrative judge ordered the parties to brief the issue
     of whether, pursuant to its decision in Savage, the Board lacks authority to award
     compensatory damages should the appellant prove her EEO affirmative defenses.
     Remand File (RF), Tab 9. The administrative judge observed that, because the
     underlying removal claim is no longer an issue, in the absence of the authority to
     award compensatory damages, the Board lacks jurisdiction over the instant
     appeal. Id. at 1, 3. Both parties responded that they believed the Board has the
     authority to award compensatory damages. RF, Tabs 15‑16. Nevertheless, the
     administrative judge ruled that the Board lacks such authority.        RF, Tab 17
     at 3‑6. On that basis, he once again found that the appeal is moot. Id. at 1, 6‑7.
     He then certified his ruling for interlocutory review. RF, Tab 18; see 5 C.F.R.
     § 1201.91.

                                         ANALYSIS
¶7         An administrative judge will certify a ruling for interlocutory review if the
     ruling involves an important question of law or policy about which there is
     substantial ground for difference of opinion; and an immediate ruling will
     materially advance the completing of the proceeding, or the denial of an
     immediate ruling will cause undue harm to a party or the public.         Cooper v.
     Department of the Navy, 98 M.S.P.R. 683, ¶ 5 (2005); 5 C.F.R. § 1201.92. In
     light of the lack of guidance regarding the impact of the Savage decision on the
     Board’s authority to award compensatory damages, we find that certificatio n was
     proper.
¶8         A case is moot when the issues presented are no longer “live” or the parties
     lack a legally cognizable interest in the outcome of the case. Wrighten v. Office
     of Personnel Management, 89 M.S.P.R. 163, ¶ 5 (2001).           An appeal will be
                                                                                          4

      dismissed as moot if, by virtue of an intervening event, the Board cannot grant
      any effectual relief in favor of the appellant. Id. Thus, an agency’s complete
      rescission of the action appealed, and an appellant’s restoration to the status quo
      ante, may render an appeal moot. Id., ¶¶ 6‑8. However, if an appellant raises a
      claim for compensatory damages that the Board has jurisdiction to adjudicate, the
      agency’s complete rescission of the action appealed does not afford her all of the
      relief available before the Board and the appeal is not moot. Id., ¶ 9.
¶9          Thus, because the agency rescinded the appellant’s removal and returned
      her to status quo ante, we must determine whether the Board has authority to
      award compensatory damages for discrimination and EEO reprisal claims. IAF,
      Tab 26 at 35-36, 56. The Board’s authority to adjudicate such claims arises from
      the “integrated scheme of administrative and judicial review” contained in the
      Civil Service Reform Act (CSRA) of 1978. United States v. Fausto, 484 U.S.
      439, 445 (1988) (finding that a former Federal employee without Board appeal
      rights was not entitled to seek judicial review of his suspension), superseded by
      statute on other grounds as stated in Kaplan v. Conyers, 733 F.3d 1148 (Fed. Cir.
      2013); CSRA, Pub. L. No. 95-454, 92 Stat. 1111 (codified as amended in various
      sections of title 5, including as pertinent here, 5 U.S.C. §§ 7701‑7703).
¶10         The CSRA does not address the Board’s authority to award compensatory
      damages in connection with discrimination claims.            See generally CSRA,
      Pub. L. No. 95-454, 92 Stat. 1111. This omission is not surprising because such
      damages were not available until more than 10 years after the CSRA was
      enacted. 1 Cf. West v. Gibson, 527 U.S. 212, 217 (1999) (observing that it was

      1
        By contrast, the Board’s authority to award reinstatement and back pay in appeals in
      which it finds discrimination derives from the CSRA. Savage, 122 M.S.P.R. 612, ¶ 47
      (citing 5 U.S.C. §§ 1204(a), 2302(b)(1), 7701(c)(2)(B)); see 5 U.S.C. § 5596(b)(1)
      (authorizing back pay for periods during which an employee was “affected by an
      unjustified or unwarranted personnel action”).
                                                                                        5

“not surprising” that the statutory authority of the Equal Employment
Opportunity Commission (EEOC) does not specifically enumerate compensatory
damages because such damages were not available when the statute in question
was enacted). With the Civil Rights Act of 1991, Pub. L. No. 102‑166, § 102,
105 Stat. 1071, 1072-74 (codified at 42 U.S.C. § 1981a), Congress authorized
compensatory damages for both title VII and disability discrimination claims
under 42 U.S.C. § 1981a(a)(1)‑(2). 2 Neither the Civil Rights Act of 1991, nor its

2
    Section 1981a provides, in relevant part:

         (a) Right of recovery
            (1) Civil rights
            In an action brought by a complaining party under section 706 or 717
            of the Civil Rights Act of 1964 [42 U.S.C. §§ 2000e-5, 2000e-16]
            against a respondent who engaged in unlawful intentional
            discrimination (not an employment practice that is unlawful because of
            its disparate impact) prohibited under section 703, 704, or 717 of the
            Act [42 U.S.C. §§ 2000e-2, 2000e-3, 2000e-16], and provided that the
            complaining party cannot recover under section 1981 of this title, the
            complaining party may recover compensatory and punitive damages as
            allowed in subsection (b) of this section, in addition to any relief
            authorized by section 706(g) of the Civil Rights Act of 1964, from the
            respondent.
            (2) Disability
            In an action brought by a complaining party under the powers,
            remedies, and procedures set forth in section 706 or 717 of the Civil
            Rights Act of 1964 [42 U.S.C. §§ 2000e-5, 2000e-16] (as provided in
            section 107(a) of the Americans with Disabilities Act of 1990
            (42 U.S.C. § 12117(a)), and section 794a(a)(l) of title 29, respectively)
            against a respondent who engaged in unlawful intentional
            discrimination (not an employment practice that is unlawful because of
            its disparate impact) under section 791 of title 29 and the regulations
            implementing section 791 of title 29, or who violated the requirements
            of section 791 of title 29 or the regulations implementing section 791
            of title 29 concerning the provision of a reasonable accommodation, or
            section 102 of the Americans with Disabilities Act of 1990 ( 42 U.S.C.
            § 12112), or committed a violation of section 102(b)(5) of the Act,
            against an individual, the complaining party may recover
                                                                                              6

      legislative history, addresses whether the Board has the authority to award
      compensatory damages.           42 U.S.C. § 1981a; H.R. Rep. Nos. 104-40(I)-(II)
      (1991), reprinted in 1991 U.S.C.C.A.N. 549; see Savage, 122 M.S.P.R. 612, ¶ 45
      (observing that title VII does not provide the Board with enforcement authority) .
      However, because the Board is charged with applying substantive discrimination
      law, we have long awarded compensatory damages. See Savage, 122 M.S.P.R.
      612, ¶ 45 (observing that the Board adjudicates substantive discrimination issues
      under the standard set forth in 42 U.S.C. § 2000e-16(a)); Southerland v.
      Department of Defense, 122 M.S.P.R. 51, ¶ 12 (2014) (observing that the Board
      generally defers to the EEOC on substantive discrimination law). 3
¶11           This practice of awarding of damages is consistent with the structure of the
      CSRA. The CSRA provides for a complex interplay between the Board and the
      EEOC. An employee or applicant alleging discrimination in conjunction with an
      otherwise appealable action initially may elect either to file an EEO complaint
      with her agency or proceed directly to the Board.           Lott v. Department of the
      Army,    82 M.S.P.R.     666,    ¶6   (1999);   5 C.F.R.    § 1201.154(a);     29 C.F.R.
      § 1614.302(b); see 5 U.S.C. §§ 7701(a), 7702(a)(1)‑(2). However, regardless of

                 compensatory and punitive damages as allowed in subsection (b) of
                 this section, in addition to any relief authorized by section 706(g) of
                 the Civil Rights Act of 1964, from the respondent.
      Both the Board and the EEOC have recognized that the term “action” in these
      subsections includes both court actions and the administrative process. Crosby v. U.S.
      Postal Service, 78 M.S.P.R. 263, ¶¶ 7-8 (1998) (citing Jackson v. Runyon, EEOC
      Appeal No. 01923399, 1992 WL 1372557 (Nov. 12, 1992)).
      3
        Member Robbins does not believe that the Board has express statutory authority to
      award compensatory damages, and inferences from title 42 are inadequate. The Board’s
      authority is limited to those matters over which is has been given authority by law, rule,
      or regulation. Maddox v. Merit Systems Protection Board, 759 F.2d 9, 10 (Fed.
      Cir. 1985). However, he does not believe this case is the proper venue in which to
      address this issue. The Board previously has awarded compensatory damages in mixed
      cases, and our holding in Savage was not intended to disrupt the status quo on this
      issue.
                                                                                         7

      the avenue chosen, the complaining individual’s only right to an ev identiary
      hearing in such mixed cases is before the Board, not the EEOC.               Rosso v.
      Department of Homeland Security, 113 M.S.P.R. 271, ¶ 11 (2010); see 5 U.S.C.
      §§ 7701(a)(1), 7702(a); 29 C.F.R. § 1614.302(d)(3) (providing that an agency
      issuing a final decision on a mixed‑case complaint “shall advise the complainant
      of the right to appeal the matter to the [Board] (not EEOC)”); see also Gubisch v.
      Department of the Treasury, 36 M.S.P.R. 634, 637 (1988) (observing that the
      EEOC has no role in a mixed-case appeal unless and until the Board has issued a
      decision that complies with 5 U.S.C. § 7702(a)(1)). In such appeals, “the Board
      shall . . . decide both the issue of discrimination and the appealable action in
      accordance with [its] appellate procedures under [5 U.S.C. §§ 7701 and 7702].”
      5 U.S.C. § 7702(a)(1); Savage, 122 M.S.P.R. 612, ¶ 45.
¶12         An appellant who disagrees with the Board’s decision may seek review
      from the EEOC. 5 U.S.C. § 7702(b)(1). The EEOC may decline to “consider”
      the Board’s decision, consider and concur in the decision, or consider and
      disagree with the decision. 5 U.S.C. § 7702(b)(2)-(3). If the EEOC disagrees, it
      must refer the matter back to the Board. 5 U.S.C. § 7702(b)(3), (b)(5)(B). The
      Board then reviews and either “concur[s] and adopt[s]” the EEOC’s decision or
      reaffirms its own decision. 5 U.S.C. § 7702(c).
¶13         If the Board reaffirms its own decision, it is required to refer the matter to
      a Special Panel, consisting of one member each from the Board and the
      Commission, and a Presidential appointee.          5 U.S.C. § 7702(c)(2), (d)(1),
      (d)(6)(A). The Special Panel then issues a decision, “giv[ing] due deference to
      the   respective   expertise   of   the   Board   and    [EEOC].”        5     U.S.C.
      § 7702(d)(2)(A)-(B).
¶14         At various stages in the process, if the employee has exhausted her
      administrative remedies, or if she has attempted to do so and sufficient time has
      elapsed, she has the right to proceed in Federal district court.             5 U.S.C.
                                                                                       8

      §§ 7702(a)(2)‑(3), (b)(5)(A), (d)(2)(A), (e)(1), 7703(b)(2). There, she is entitled
      to de novo review. 5 U.S.C. §§ 7702(e)(3), 7703(c).
¶15         A Senate Report on the CSRA expressed the intent that the Board consider
      discrimination claims together with “the employee’s inefficiency or misconduct”
      as “two sides of the same question.” S. Rep. No. 95‑969, at 53 (1978), reprinted
      in 1978 U.S.C.C.A.N. 2723, 2775. This would permit a “single unified personnel
      policy which took into account the requirements of all the various laws and goals
      governing Federal personnel management.” Id. The mixed-case appeal process
      was intended to streamline adjudication, avoid “forum shopping and inconsistent
      decisions,” and ensure that “the Board and the [EEOC] work together to resolve
      any differences.” Id.
¶16         Similarly, a joint statement by a Senate and House conference committee
      expressed the goal to “maintain[] the principle of parity between the MSPB and
      EEOC” in the mixed-case appeal process. H.R. Rep. No. 95‑1717, at 139 (1978)
      (Conf. Rep.), reprinted in 1978 U.S.C.C.A.N. 2860, 2873. Therefore, the Board’s
      decision in a mixed-case appeal was to “include[] any remedial order the
      [EEOC] . . . may impose under law.” H.R. Rep. No. 95‑1717, at 140, reprinted
      in 1978 U.S.C.C.A.N. at 2873. The EEOC was to determine whether the Board
      correctly interpreted the laws “over which the EEOC has jurisdiction” and
      awarded an appropriate remedy. H.R. Rep. No. 95‑1717, at 140, reprinted in
      1978 U.S.C.C.A.N. at 2873-74.
¶17         Consistent with their relative roles in adjudicating appealable actions, the
      Board generally defers to the EEOC on issues of substantive discrimination law
      unless the EEOC’s decision rests on civil service law for its support or is so
      unreasonable that it amounts to a violation of civil service law. Southerland,
      122 M.S.P.R. 51, ¶ 12. The Civil Rights Act of 1991 provides for compensatory
      damages in matters brought pursuant to 42 U.S.C. § 2000e-16.             42 U.S.C.
      § 1981a(a)(1); West, 527 U.S. at 217-23. Further, the EEOC has the authority to
                                                                                       9

      award compensatory damages pursuant to the Civil Rights Act of 1991. West,
      527 U.S. at 217‑20, 223. In finding such authority appropriate, the U.S. Supreme
      Court reasoned that it is consistent with a remedial scheme that requires
      exhaustion of administrative remedies to “encourag[e] quicker, less formal, and
      less expensive resolution of disputes within the Federal Government outside of
      court.” Id. at 218-19.
¶18         This reasoning is equally applicable here, particularly because, as
      discussed above, an employee’s only right to an administrative hearing on a
      discrimination claim related to an otherwise appealable action is before the
      Board.    Further, because such cases necessarily contain allegations that
      discrimination prohibited by 42 U.S.C. § 2000e-16 occurred, we find the
      reasoning in West extends to the Board’s adjudication of these claims.         See
      5 U.S.C. § 7702(a)(1)(B)(i); see also 5 U.S.C. § 7703(b)(2) (stating that “[c]ases
      of discrimination subject to the provisions of section 7702 of this title shall be
      filed under [42 U.S.C. § 2000e‑16(c)]”). Although the Board stated in Savage
      that mixed-case appeals are decided using the Board’s appellate procedures, it
      also recognized that the substantive standard for title VII claims in the Federal
      sector is set forth in 42 U.S.C. § 2000e-16. Savage, 122 M.S.P.R. 612, ¶¶ 44-45.
      Therefore, we find that Savage did not affirmatively diminish the Board’s
      previous practice of awarding compensatory damages.
¶19         The EEOC believes that the Board is required to adjudicate an appellant’s
      claim for any compensatory damages resulting from a discriminatory or
      retaliatory adverse action. Martin v. Department of the Air Force, 73 M.S.P.R.
      590, 593-94 (1997). Although it reasonably may be argued that the question of
      whether compensatory damages are available in the administrative process
      involves the Board’s jurisdiction, and therefore is a matter of civ il service law,
      the Board previously has found that, at base, the issue is one of discrimination
      law. Crosby v. U.S. Postal Service, 78 M.S.P.R. 263, ¶ 8 (1998). The Board
                                                                                       10

      reasoned that the authority for compensatory damages derives from the Civil
      Rights Act of 1991, which is discrimination law, and implicates not just the
      Board’s authority, but that of the EEOC. Id. Thus, if an appellant prevails in an
      appeal before the Board based on a finding of discrimination, she may recover
      compensatory damages from the agency pursuant to the Civil Rights Act of 1991.
      Hocker v. Department of Transportation, 63 M.S.P.R. 497, 505 (1994), aff’d per
      curiam, 64 F.3d 676 (Fed. Cir. 1995) (Table); 5 C.F.R. § 1201.202(c) (reflecting
      the Board’s authority to award compensatory damages under the C ivil Rights Act
      of 1991).   We continue to defer to the EEOC’s interpretation of the Board’s
      ability to award compensatory damages, which we find is not so unreasonable as
      to amount to a violation of civil service law.
¶20         In light of our finding that Savage does not alter the Board’s previous
      practice of awarding compensatory damages, we find that the appeal is not moot.

                                            ORDER
¶21         Accordingly, we vacate the stay order issued in this proceeding and return
      the appeal to the regional office for further processing and adjudication consistent
      with this Opinion and Order.

      FOR THE BOARD:

      ______________________________
      Jennifer Everling
      Acting Clerk of the Board
      Washington, D.C.