Banks v. Merit Systems Protection Board , 854 F.3d 1360 ( 2017 )

United States Court of Appeals
for the Federal Circuit
______________________
PHYLLIS E. BANKS,
Petitioner
v.
MERIT SYSTEMS PROTECTION BOARD,
Respondent
______________________
2017-1242
______________________
Petition for review of the Merit Systems Protection
Board in No. SF-0752-16-0381-I-1.
______________________
Decided: April 18, 2017
______________________
PHYLLIS E. BANKS, Inglewood, CA, pro se.
KATRINA LEDERER, Office of the General Counsel,
Merit Systems Protection Board, Washington, DC, for
respondent. Also represented by BRYAN G. POLISUK,
KATHERINE M. SMITH.
______________________
Before PROST, Chief Judge, NEWMAN, and DYK, Circuit
Judges.
2 BANKS v. MSPB
DYK, Circuit Judge.
Phyllis E. Banks petitions for review of a decision by
the Merit Systems Protection Board (“Board”) dismissing
her appeal for lack of jurisdiction. We affirm.
BACKGROUND
Banks was hired by the Department of Veterans Af-
fairs (“VA”) on July 26, 2015, as a Medical Support Assis-
tant. Her appointment was in the excepted service and
was subject to a one-year probationary period. On March
2, 2016, within the one-year period, the VA notified Banks
that the agency planned to terminate her due to perfor-
mance issues. Rather than wait for the agency to termi-
nate her, Banks chose to resign her position, effective
March 15, 2016.
Banks appealed to the Board, asserting that her res-
ignation was involuntary and therefore constituted a
constructive removal. See, e.g., Cruz v. Dep’t of Navy, 934
F.2d 1240, 1244 (Fed. Cir. 1991) (en banc). In an initial
decision dismissing Banks’s appeal for lack of jurisdiction,
the administrative judge (“AJ”) found that Banks was not
preference eligible and that the record contained no
evidence of prior federal service. Given these facts and
that Banks was still within her probationary period at the
time of her alleged removal, the AJ concluded that Banks
was not an “employee” under 5 U.S.C. § 7511(a)(1) with
the right to appeal adverse actions to the Board. The
Board therefore lacked jurisdiction. The AJ further noted
Banks’s allegations of a hostile work environment and
retaliation, but concluded that these claims did not pro-
vide the Board with jurisdiction under 5 U.S.C. § 7702(a)
in the absence of non-frivolous allegations of an agency
action independently appealable to the Board. See Garcia
v. Dep’t of Homeland Sec., 437 F.3d 1322, 1335 (Fed. Cir.
2006) (en banc). Banks petitioned the Board for review.
BANKS v. MSPB 3
The Board upheld the AJ’s dismissal of Banks’s ap-
peal for lack of jurisdiction. In doing so, the Board ad-
dressed evidence not considered by the AJ indicating that,
prior to being hired by the VA, Banks had been currently
and continuously employed by the U.S. Postal Service for
approximately three years as a Mail Handler. The Board
concluded that this prior federal service did not give
Banks a right to appeal because the Postal Service is not
an “Executive agency” under 5 U.S.C. § 7511(a)(1)(C)(ii).
The Board issued a final order dismissing Banks’s appeal
for lack of jurisdiction.
Banks petitioned for review of the Board’s final order.
We have jurisdiction under 28 U.S.C. § 1295(a)(9).
DISCUSSION
We review the Board’s jurisdictional determinations
de novo and its factual findings for substantial evidence.
See Bolton v. Merit Sys. Prot. Bd., 154 F.3d 1313, 1316
(Fed. Cir. 1998). “The Board’s statutory interpretations
are reviewed for correctness as a matter of law.” Ellison v.
Merit Sys. Prot. Bd., 7 F.3d 1031, 1034 (Fed. Cir. 1993).
The Board’s jurisdiction is limited and extends only to
actions “appealable to the Board under any law, rule, or
regulation.” 5 U.S.C. § 7701(a). As relevant here, 5 U.S.C.
§ 7513(d) permits an “employee” to appeal certain adverse
actions to the Board, including involuntary resignations
that are deemed constructive removals. See, e.g., Cruz,
934 F.2d at 1244. For the purpose of § 7513(d), however,
the term “employee” is defined—in relevant part—as “an
individual in the excepted service (other than a preference
eligible)” who is either “not serving a probationary or trial
period,” 5 U.S.C. § 7511(a)(1)(C)(i), or “has completed 2
years of current continuous service . . . in an Executive
agency,” id. § 7511(a)(1)(C)(ii). An individual may qualify
as an “employee” under either § 7511(a)(1)(C)(i) or (ii).
See, e.g., Van Wersch v. Dep’t of Health & Human Servs.,
197 F.3d 1144, 1151 (Fed. Cir. 1999).
4 BANKS v. MSPB
Because Banks was still serving her one-year proba-
tionary period with the VA when she resigned, her only
claim to the status of an “employee” turns on whether her
three years with the Postal Service qualify as “current
continuous service . . . in an Executive agency” under
§ 7511(a)(1)(C)(ii). 1 In this regard, 5 U.S.C. § 105 provides
that “[f]or the purpose of [Title 5], ‘Executive agency’
means an Executive department, a Government corpora-
tion, and an independent establishment.” The Postal
Service is not an “Executive department” or a “Govern-
ment corporation” as defined in relevant part under 5
U.S.C. §§ 101 and 103. Instead the Postal Service is an
“independent establishment of the executive branch of the
Government of the United States.” 39 U.S.C. § 201; U.S.
Postal Serv. v. Flamingo Indus. (USA) Ltd., 540 U.S. 736,
746 (2004) (“Congress, however, declined to create the
Postal Service as a Government corporation, opting
instead for an independent establishment.”).
Despite 39 U.S.C. § 201, 5 U.S.C. § 104 provides that
the Postal Service is not an “independent establish-
ment”—and therefore not an “Executive agency”—for the
purpose of Title 5. Section 104 states that “[f]or the pur-
1 The Office of Personnel Management has exer-
cised its authority under 5 U.S.C. § 7514 to promulgate
regulations implementing § 7511. Under these regula-
tions, “current continuous employment” is defined as “a
period of employment or service immediately preceding an
adverse action without a break in Federal civilian em-
ployment of a workday.” 5 C.F.R. § 752.402. We have held
that this regulation governs the interpretation of the term
“current continuous service” under § 7511, see Wilder v.
Merit Systems Protection Board, 675 F.3d 1319, 1322–23
(Fed. Cir. 2012), and there is no contention that Banks’s
employment with the Postal Service does not qualify as
“current continuous service” under the statute.
BANKS v. MSPB 5
pose of this title, ‘independent establishment’ means . . .
an establishment in the executive branch (other than the
United States Postal Service . . . ).” (emphasis added).
Both the designation of the Postal Service as an “in-
dependent establishment” in § 201 and the parenthetical
exclusion of the Postal Service as an “independent estab-
lishment” in § 104 were enacted by Congress in the Postal
Reorganization Act (“PRA”). See Pub. L. No. 91-375 § 2, 84
Stat. 719, 720 (1970); id. § 6(c)(2), 84 Stat. at 775. In the
PRA, Congress sought to recast “the operation of the
[P]ostal [S]ervice in ‘a business-like way,’” i.e., “to make
the delivery of the mail a self-supporting enterprise.”
Standard Oil Div., Am. Oil Co. v. Starks, 528 F.2d 201,
202 (7th Cir. 1975). In addition to insulating the Postal
Service “from the political arena,” the PRA furthered this
goal by broadly exempting the Postal Service from federal
laws “dealing with the public or [f]ederal contracts, prop-
erty, works, officers, employees, budgets or funds,” subject
to certain enumerated exceptions. Id. (quoting 39 U.S.C.
§ 410(a)); see also, e.g., Beneficial Fin. Co. of N.Y. v. Dal-
las, 571 F.2d 125, 128 (2d Cir. 1978).
The legislative history of the PRA makes clear that
civil service provisions governing personnel at other
federal agencies would not apply wholesale to employees
of the reorganized Postal Service. See S. Rep. No. 91-912,
at 5–7 (1970) (“Senate Report”) (“Employees who have
competitive status under the Civil Service Act of 1883
shall automatically achieve career tenure under the
postal career system, but thereafter the provisions of title
5 . . . shall not apply to officers and employees of the
Postal Service.”). In keeping with this goal, the PRA as
amended omits the provisions governing adverse-action
appeals to the Board from the listing of Title 5 provisions
that remain applicable to the Postal Service. See 39
U.S.C. § 410(b)(1). This omission accords with, inter alia,
39 U.S.C. § 1005(a)(1)(A), which makes the adverse-action
provisions applicable only to the extent that they are
6 BANKS v. MSPB
consistent with collective-bargaining agreements that the
Postal Service may make with its employees. See id.
(referring to “the provisions of chapter 75 of title 5”); see
also Senate Report at 5–7 (recommending the “enact-
ment” of collective bargaining agreements).
The exclusion of the Postal Service as an “independ-
ent establishment” in § 104 is consistent with the statuto-
ry framework of the PRA that makes Title 5 applicable to
the Postal Service only in piecemeal fashion. Relying in
part on § 104’s exclusion, we have held that preference-
eligible Postal Service employees may not seek attorneys’
fees under the fee-shifting provision of the Back Pay Act,
5 U.S.C. § 5596(b)(1)(A)(ii). See Erickson v. U.S. Postal
Serv., 759 F.3d 1341, 1347 (Fed. Cir. 2014). In Erickson,
we held that the Back Pay Act does not apply to the
Postal Service “by its own terms . . . because the Postal
Service is not an ‘executive agency,’ the term . . . used to
define the scope of the [Back Pay] Act’s coverage.” Id. We
reasoned that although § 105 defines an “executive agen-
cy” as encompassing independent establishments, that
term “is further defined to mean ‘an establishment in the
executive branch (other than the United States Postal
Service . . . ).’” Id. at 1348 (quoting 5 U.S.C. § 104). We
therefore concluded that “[t]he Postal Service is . . . not an
‘executive agency’ within the meaning of title 5 in general
and the Back Pay Act in particular.” Id.
We see no reason to depart from our conclusion in Er-
ickson, which held that the provisions of § 104 displace,
for the purpose of Title 5, the general characterization of
the Postal Service as an “independent establishment” set
forth in § 201. Id.; see also, e.g., RadLAX Gateway Hotel,
LLC v. Amalgamated Bank, 132 S. Ct. 2065, 2070–71
(2012). Accordingly, the Postal Service does not fall into
any of the categories that define an “Executive agency”
under Title 5, which renders Banks’s service as a Mail
Handler not “service . . . in an Executive agency” under
§ 7511(a)(1)(C)(ii). As a consequence, Banks does not
BANKS v. MSPB 7
qualify as an “employee” with a right to appeal adverse
actions to the Board. See Van Wersh, 197 F.3d at 1151.
There being no action appealable to the Board under
§ 7701, the remaining issues raised in Banks’s appeal—
her claims of retaliation and a hostile work environ-
ment—lie outside the Board’s jurisdiction. See Garcia, 437
F.3d at 1335. The Board’s final order dismissing Banks’s
appeal for lack of jurisdiction is
AFFIRMED
COSTS
No costs.