Court Opinion

ID: 2982014
Source: CourtListenerOpinion
Date Created: 2015-09-22 20:00:18.217102+00
Date Added: 2024-06-11T15:00:20.661526
License: Public Domain

UNITED STATES OF AMERICA
                        MERIT SYSTEMS PROTECTION BOARD

     TRAVIS E. WILKES,                               DOCKET NUMBER
                   Appellant,                        DA-0432-11-0466-C-1

                  v.

     DEPARTMENT OF VETERANS                          DATE: September 22, 2015
       AFFAIRS,
                 Agency.

             THIS FINAL ORDER IS NONPRECEDENTIAL 1

           Daniel J. Gamino, Esquire, Oklahoma City, Oklahoma, for the appellant.

           Joan M. Green, Esquire, Oklahoma City, Oklahoma, for the agency.

                                           BEFORE

                              Susan Tsui Grundmann, Chairman
                                 Mark A. Robbins, Member

                                       FINAL ORDER

¶1         The appellant has filed a petition for review of the compliance initial
     decision, which denied his petition for enforcement following the Board’s
     reversal of his removal. Generally, we grant petitions such as this one only when:
     the initial decision contains erroneous findings of material fact; the initial

     1
        A nonprecedential order is one that the Board has determined does not add
     significantly to the body of MSPB case law. Parties may cite nonprecedential orders,
     but such orders have no precedential value; the Board and administrative judges are not
     required to follow or distinguish them in any future decisions. In contrast, a
     precedential decision issued as an Opinion and Order has been identified by the Board
     as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).
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     decision is based on an erroneous interpretation of statute or regulation or the
     erroneous application of the law to the facts of the case; the judge’s rulings
     during either the course of the appeal or the initial decision were not consistent
     with required procedures or involved an abuse of discretion, and the resulting
     error affected the outcome of the case; or new and material evidence or legal
     argument is available that, despite the petitioner’s due diligence, was not
     available when the record closed. See Title 5 of the Code of Federal Regulations,
     section 1201.115 (5 C.F.R. § 1201.115). After fully considering the filings in this
     appeal, we conclude that the petitioner has not established any basis under section
     1201.115 for granting the petition for review. Therefore, we DENY the petition
     for review. Except as expressly MODIFIED by this Final Order to supplement
     the analysis concerning the reinstatement of the appellant’s Thrift Savings Plan
     (TSP) account loan, we AFFIRM the compliance initial decision.

                                      BACKGROUND
¶2        The appellant filed a petition for enforcement of the Board’s Final Order in
     Wilkes v. Department of Veterans Affairs, MSPB Docket No. DA-0432-11-0466-
     I-3, Final Order (Aug. 21, 2014), which ordered the agency to cancel his removal
     and retroactively restore him to duty, effective April 23, 2011, 2 with back pay and
     benefits. In his petition, the appellant alleged that the agency failed to comply
     with the Board’s order because it had not provided a complete written narrative
     account of the actions taken to restore him and because he had not been fully
     reinstated. Compliance File (CF), Tab 1 at 5.
¶3        The administrative judge found that the agency adequately explained its
     back pay calculations and that the appellant’s claim for an additional $10,219.57
     was based on computation errors. CF, Tab 20, Compliance Initial Decision (CID)

     2
       The Board’s Final Order contained a typographical error and referred to the
     appellant’s effective restoration date as April 23, 2014. Wilkes v. Department of
     Veterans Affairs, MSPB Docket No. DA-0432-11-0466-I-3, Final Order (Aug. 21,
     2014). The appellant’s effective restoration date should be April 23, 2011.
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     at 2-3.    The administrative judge further found that the parties merely used
     different rounding methods to calculate the deductions for life insurance
     premiums and the agency’s rounding method favored the appellant by $24.65.
     CID at 3. The administrative judge also found that, to the extent that the agency
     erred by not providing a written narrative statement setting forth its back pay
     calculations, the error was harmless because the agency provided the appellant
     and his representative with a spreadsheet explaining the calculations and they had
     the opportunity to ask agency officials about the spreadsheet and the back pay
     calculations.   Id.     The administrative judge found that the agency was in
     compliance regarding the appellant’s TSP account because the agency could not
     change the distribution of funds in his account, but he could, by directly
     contacting the Federal Retirement Thrift Investment Board (FRTIB). CID at 3-4.
     The administrative judge also found that the appellant cited no regulation or rule
     requiring the agency to reimburse him for the tax consequences of a TSP loan
     converted to a withdrawal when he separated from service. CID at 4-5.
¶4         The appellant has filed a petition for review.     Compliance Petition for
     Review (CPFR) File, Tab 1. The agency has filed an opposition to the appellant’s
     petition for review. CPFR File, Tab 3.

                      DISCUSSION OF ARGUMENTS ON REVIEW
     The agency provided the appellant with adequate notice of how it calculated his
     back pay award.
¶5         When the Board reverses a personnel action, it orders that the appellant be
     placed, as nearly as possible, in the situation he would have been in had the
     wrongful    personnel    action   not   occurred.   Vaughan   v.   Department   of
     Agriculture, 116 M.S.P.R. 319, ¶ 5 (2011). The agency bears the burden to prove
     compliance with the Board’s order. Id. An agency’s assertions of compliance
     must include a clear explanation of its compliance actions supported by
     documentary evidence. Id. The appellant may rebut the agency’s evidence of
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     compliance by making specific, nonconclusory, and supported assertions of
     continued noncompliance. Id.
¶6        The appellant argues that the agency failed to comply with the relief order
     because it never provided a written narrative explaining how his back pay award
     was calculated. CPFR File, Tab 1 at 6-8, 10-11, 14-15. The Board ordered the
     agency to inform the appellant in writing of the actions taken to comply with the
     Board’s relief order. Wilkes v. Department of Veterans Affairs, MSPB Docket
     No. DA-0432-11-0466-I-3, Final Order, ¶ 11 (Aug. 21, 2014). The agency sent
     the appellant a letter dated October 9, 2014, informing him that it believed it was
     in full compliance. CF, Tab 8 at 23-25. The appellant argued that this letter was
     deficient because the agency had not provided affidavits or written documentation
     of transactions with other agencies, or the names and addresses of the person
     responsible for implementing the relief order. CF, Tab 9 at 4-5. On November 3,
     2014, the administrative judge issued an order summarizing the appellant’s
     continuing compliance concerns. CF, Tab 12. In that order, the administrative
     judge stated, among other things, “I am requiring the agency to afford the
     appellant a narrative explanation/accounting of how the back pay payment was
     calculated and what deductions [were] taken from it, including the dates of the
     back pay period.”    Id. at 2.   In response to this order, the agency filed an
     explanation on January 29, 2015. CF, Tab 15.
¶7        We find that the agency provided adequate written notice concerning the
     implementation of the back pay award.       A number of the compliance issues
     originally raised by the appellant concerning the back pay calculations were
     resolved through the exchange of letters, documentary evidence, telephone status
     conferences, and meetings. CID at 2. The appellant argues that the agency’s
     letter failed to comply with the Board’s order because it did not contain the name
     and address of the person responsible for compliance; however, the record
     contains a sworn statement from an agency employee attesting that he
     “coordinated and monitored” the appellant’s reinstatement. CF, Tab 10 at 8. The
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     appellant’s own accounting firm was able to conduct a complete review of the
     agency’s back pay calculations based on the documentary evidence provided by
     the agency, without needing additional documents, narratives, or explanations.
     CF, Tab 9, Exhibit (Ex.) H. Based on the foregoing, we find the agency complied
     with the relief order by informing the appellant in writing of the actions taken to
     comply with the order.
¶8         In addition to the requirements in the relief order, the administrative judge
     ordered the agency to file a “narrative explanation” addressing its compliance
     with the back pay award.       CF, Tab 12.     An administrative judge has the
     discretionary authority to order the production of evidence.             5 C.F.R.
     § 1201.41(b)(10). The Board will not find reversible error in a matter left to an
     administrative judge’s discretion absent an abuse of discretion. Cf. Vaughn v.
     Department of the Treasury, 119 M.S.P.R. 605, ¶ 15 (2013). The administrative
     judge found that, to the extent that the appellant never received a narrative
     statement setting forth the back pay calculation, any such error was harmless
     because the agency provided a spreadsheet to explain the award and met with the
     appellant and his representative to answer questions. CID at 3. Having reviewed
     the record, we find no abuse of discretion in the administrative judge’s
     determination.   Even if the agency failed to fully comply with this order to
     provide a narrative explanation of how the back pay payment was calculated, that
     error was not harmful because the record contains sufficient other evidence to
     enable the appellant to identify any compliance issues with the back pay award.
     He has not shown that he was harmed by not getting the same information
     concerning the back pay calculation in narrative form.       See Russell v. Equal
     Employment Opportunity Commission, 110 M.S.P.R. 557, ¶ 15 (denying the
     petition for review based on alleged procedural errors by the administrative judge
     when the appellant failed to show how any of the purported errors prejudiced her
     substantive rights).
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¶9        On the day the record closed below, the agency filed a written explanation
     addressing the compliance issues that the appellant raised in his brief in support
     of the petition for enforcement. CF, Tab 19; see CF, Tab 17. The appellant
     claims that the agency’s explanation did not meet “the requirements of the law”
     and that, by accepting the agency’s submission on the day that the record closed,
     the administrative judge denied him an opportunity to review it and question the
     agency’s actions. CPFR File, Tab 1 at 14. Determining when to close the record
     is within an administrative judge’s sound discretion, but such discretion must
     comport with basic requirements of fairness and notice. Blackmer v. Department
     of the Navy, 52 M.S.P.R. 571, 574 (1992). The parties were on notice that the
     agency had until the close of the record to file a response. CF, Tab 16. The
     appellant neither objected to this notice when it was issued nor attempted to file a
     response to the agency’s submission during the month between the close of the
     record and the issuance of the compliance initial decision. The appellant’s failure
     to timely object to the administrative judge’s ruling precludes him from doing so
     on petition for review.     See McCarthy v. International Boundary & Water
     Commission, 116 M.S.P.R. 594, ¶ 25 (2011) (finding that the appellant’s failure
     to timely object to rulings during the hearing precludes his doing so on petition
     for review), aff’d, 497 F. App’x 4 (Fed. Cir. 2012), cert. denied, 134 S. Ct. 386
     (2013). Moreover, the appellant was given multiple opportunities to rebut the
     agency’s compliance evidence below, and he now has had the opportunity to raise
     any outstanding compliance issues through his petition for review.              The
     administrative judge did not abuse his discretion by determining that the record
     would close after the agency had one final opportunity to respond to the
     compliance issues that remained after considerable efforts by both parties to
     resolve those issues. CF, Tabs 9, 17.
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      The appellant is not entitled to restoration of his TSP account loan under the
      Back Pay Act.
¶10        The appellant argues that the agency is not in compliance because it has not
      reinstated a loan outstanding from his TSP account when he separated from
      service. CPFR File, Tab 1 at 9-14. The regulations implementing the Back Pay
      Act require that an agency correct errors affecting an employee’s TSP account
      consistent with the regulations prescribed by the FRTIB. Price v. U.S. Postal
      Service, 118 M.S.P.R. 222, ¶ 16 (2012) (citing 5 C.F.R. § 550.805(h)).             In
      accordance with the FRTIB’s regulations, the appellant had the option to restore
      the amount withdrawn from his TSP account at the time of his separation and, in
      such a case, could elect to reinstate an outstanding loan that was treated as a
      taxable distribution.     See Crazy Thunder-Collier v. Department of the
      Interior, 115 M.S.P.R. 82, ¶ 13 (2010) (citing 5 C.F.R. § 1605.13(d)-(e)). The
      option to restore withdrawn funds expires if the participant does not exercise the
      option by notifying the FRTIB within 90 days of his reinstatement.        5 C.F.R.
      § 1605.13(d).   The Board has found that this regulation does not obligate an
      agency to notify an employee of this option.          Crazy Thunder-Collier, 115
      M.S.P.R. 82, ¶¶ 13-14 (stating that it was incumbent on the appellant to make
      inquiries if she wished to restore funds to her TSP account upon reinstatement).
¶11        We agree with the administrative judge’s conclusion that the agency plays
      no role in reinstating the appellant’s TSP loan. CID at 4. To the extent that the
      administrative judge relied on the tax consequences of the TSP loan being
      converted to a withdrawal, an issue the appellant believes is irrelevant in his
      petition for review, CPFR File, Tab 1 at 13, we modify the initial decision. We
      reach the same conclusion as the administrative judge based on our finding in
      Crazy Thunder-Collier.      Since an agency has no obligation to inform the
      employee of her right to reinstate a TSP loan, the appellant’s position that the
      agency had an obligation to reinstate his loan is untenable.
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      The agency cannot change the breakage calculated for the appellant’s makeup
      contributions.
¶12             The appellant appears to be arguing that the agency failed to comply
      with 5 C.F.R. § 1605.13 by not calculating the breakage on his TSP makeup
      contributions based on investment in the correct fund. CPFR File, Tab 1 at 7-8,
      11, 13-15; see CF, Tab 9 at 28, Tab 18, Ex. D.             Makeup contributions are
      contributions that should have been deducted from an employee’s basic pay or
      contributed by the agency on an earlier date but were not deducted or
      contributed. 5 C.F.R. § 1605.1. Breakage is the loss incurred or gain realized on
      makeup contributions. Id. Makeup contributions and the associated breakage are
      invested according to the employee’s contribution allocation on the posting
      date. 3      5 C.F.R. § 1605.13(a)(3).     Calculating breakage is based on the
      participant’s contribution allocation on file for the “as of” the date.      5 C.F.R.
      § 1605.2(b). The “as of” date is the date the TSP contribution should have taken
      place. 5 C.F.R. § 1605.1(b).
¶13             The appellant appears to be alleging that, at the time of his separation, he
      had a contribution allocation on file investing all of his contributions in the C
      Fund, and therefore his breakage should have been calculated based on an
      investment in that fund. CF, Tab 9 at 28, Tab 18, Ex. D. The agency states that it
      has been advised by the TSP and the Defense Finance and Accounting Service
      that the management of the appellant’s TSP account is a matter between the
      appellant and the TSP. CF, Tab 19 at 8. The appellant acknowledges that he
      received both makeup contributions and breakage. CPFR File, Tab 1 at 12. We
      agree with the administrative judge’s finding that the agency is in compliance
      with its TSP payment obligations under the applicable regulations.          CID at 4.
      Calculating breakage is a function of the FRTIB/TSP, not a function of the
      employing agency. See 5 C.F.R. § 1605.2 (stating that “[t]he TSP” will calculate

      3
        Posting date means the date on which a transaction is credited or debited to a
      participant’s account. 5 C.F.R. § 1690.1.
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      breakage on makeup contributions).      The appellant’s remedy for errors in the
      breakage calculation is found in the procedures in 5 C.F.R. Part 1605, Subpart C.
      See 5 C.F.R. § 1605.21(a)(2)(iii).
¶14         The appellant alleges that the “expert testimony” provided in the form of
      letters from an accounting firm explaining his financial losses was never
      addressed by the administrative judge.        CPFR File, Tab 1 at 7.           The
      administrative judge’s failure to mention all of the evidence of record does not
      mean that he did not consider it in reaching his decision. Marques v. Department
      of Health & Human Services, 22 M.S.P.R. 129, 132 (1984), aff’d, 776 F.2d
      1062 (Fed. Cir. 1985) (Table). Some of the compliance issues identified by the
      accounting firm were not included in the appellant’s brief in support of his
      petition for enforcement.    The calculation of interest on the back pay award,
      deductions from the award for union dues, and the number of pay periods the
      appellant was paid after his reinstatement were identified as compliance issues by
      the accounting firm, but were not included in the appellant’s brief in support of
      his petition for enforcement. Compare CF, Tab 9, Exs. H, K, with CF, Tab 17.
      Each of the remaining issues identified by the accounting firm, including the back
      pay calculation, the deductions taken from the back pay award for health
      insurance, and the calculation of breakage, were addressed by the administrative
      judge in the initial decision and also have been considered and addressed on
      review. For the foregoing reasons, we find that the agency is in compliance with
      the relief order.

                          NOTICE TO THE APPELLANT REGARDING
                             YOUR FURTHER REVIEW RIGHTS
            The initial decision, as supplemented by this Final Order, constitutes the
      Board’s final decision in this matter. 5 C.F.R. § 1201.113. You have the right to
      request review of this final decision by the United States Court of Appeals for the
      Federal Circuit.     You must submit your request to the court at the following
      address:
                                                                                   10

                          United States Court of Appeals
                              for the Federal Circuit
                            717 Madison Place, N.W.
                             Washington, DC 20439

     The court must receive your request for review no later than 60 calendar
days after the date of this order. See 5 U.S.C. § 7703(b)(1)(A) (as rev. eff. Dec.
27, 2012). If you choose to file, be very careful to file on time. The court has
held that normally it does not have the authority to waive this statutory deadline
and that filings that do not comply with the deadline must be dismissed. See
Pinat v. Office of Personnel Management, 931 F.2d 1544 (Fed. Cir. 1991).
     If you need further information about your right to appeal this decision to
court, you should refer to the Federal law that gives you this right. It is found in
Title 5 of the United States Code, section 7703 (5 U.S.C. § 7703) (as rev. eff.
Dec. 27, 2012). You may read this law as well as other sections of the United
States   Code,    at   our     website,   http://www.mspb.gov/appeals/uscode.htm.
Additional       information         is     available      at      the         court’s
website, www.cafc.uscourts.gov. Of particular relevance is the court’s “Guide
for Pro Se Petitioners and Appellants,” which is contained within the
court’s Rules of Practice, and Forms 5, 6, and 11.
     If you are interested in securing pro bono representation for an appeal to the
United States Court of Appeals for the Federal Circuit, you may visit our website
at   http://www.mspb.gov/probono for        information    regarding     pro     bono
representation for Merit Systems Protection Board appellants before the Federal
Circuit. The Merit Systems Protection Board neither endorses the services
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provided by any attorney nor warrants that any attorney will accept representation
in a given case.

FOR THE BOARD:                           ______________________________
                                         William D. Spencer
                                         Clerk of the Board
Washington, D.C.