Arceneaux v. Irs ( 2021 )

Case: 19-2366 Document: 42 Page: 1 Filed: 07/29/2021
NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
ANGEL L. ARCENEAUX,
Petitioner
v.
INTERNAL REVENUE SERVICE,
Respondent
______________________
2019-2366
______________________
Petition for review of an arbitrator's decision by Sam-
uel Vitaro.
______________________
Decided: July 29, 2021
______________________
KATHRYN W. BAILEY, Office of General Counsel, Na-
tional Treasury Employees Union, Washington, DC, for pe-
titioner. Also represented by GREGORY O'DUDEN.
ANDREW JAMES HUNTER, Commercial Litigation
Branch, Civil Division, United States Department of Jus-
tice, Washington, DC, for respondent. Also represented by
JEFFREY B. CLARK, ELIZABETH MARIE HOSFORD, ROBERT
EDWARD KIRSCHMAN, JR.
______________________
Case: 19-2366 Document: 42 Page: 2 Filed: 07/29/2021
2 ARCENEAUX v. IRS
Before NEWMAN, LOURIE, and HUGHES, Circuit Judges.
Opinion for the court filed by Circuit Judge HUGHES.
Dissenting opinion filed by Circuit Judge NEWMAN.
HUGHES, Circuit Judge.
Angel Arceneaux invoked an arbitration clause in her
collective bargaining agreement after she was removed
from her job at the IRS. The arbitrator dismissed that in-
vocation as untimely. Because we agree with the arbitrator
that Ms. Arceneaux’s invocation of arbitration was un-
timely, we affirm.
I
Ms. Arceneaux was employed by the IRS starting in
2005. After a number of gaps in employment due to her res-
ignation from various roles within the IRS, she was hired
as a Tax Examiner on February 22, 2016, and then in Oc-
tober 2016 she was moved to the role of customer service
representative.
On February 16, 2017, the IRS notified Ms. Arceneaux
that a recommendation had been made for her removal due
to excessive absences but that she could avoid removal by
a voluntary resignation. J.A. 2. The next day, Ms. Arce-
neaux responded with a letter agreeing to resign, but
stated in the letter that she was being “forced to resign.”
Id. Rather than accept this resignation under protest, the
IRS terminated her employment and notified Ms. Arce-
neaux in a letter dated February 17, 2017. The letter stated
in relevant part:
Dear Ms. Arceneaux:
This is a notice of my decision to terminate your
employment with the Internal Revenue Service, ef-
fective Friday February 17, 2017, in accordance
with Part 315.804 of the Office of Personnel Man-
agement (OPM) regulations.
Case: 19-2366 Document: 42 Page: 3 Filed: 07/29/2021
ARCENEAUX v. IRS 3
J.A. 30. The letter continued by describing reasons for
Ms. Arceneaux’s termination and certain appeal rights.
J.A. 30–31. The letter also noted that Ms. Arceneaux was
still in her probationary period at the time of termination.
J.A. 30.
Under its 2016 National Agreement with the IRS (the
Agreement), the National Treasury Employees’ Union
(NTEU) secured certain rights for IRS employees who com-
pleted their probationary period. As such, if Ms. Arceneaux
had tenure, she would have had various rights, including
the right to 30 days’ notice of a proposed adverse action,
the right to file a reply, and the right to invoke arbitration.
The Agreement provides that: “The Union must invoke ar-
bitration within thirty (30) days of the date the employee
receives the final decision issued by the Employer.” Agree-
ment, Art. 39, § 6(B).
On March 10, 2017, a Union representative wrote the
IRS:
As the designated representative of your employee
Angel L Arceneaux we are requesting an oral re-
ply/written reply to the removal dated February 17,
2017 and received February 23, 2017. I am also re-
questing the related evidentiary file.
J.A. 37. On March 13, 2017, the IRS responded to the rep-
resentative as follows:
Management is unable to fulfil your request for an
oral reply/written reply and evidence relied upon in
regard to the removal of probationary employee
Angel Arceneaux, as she is not covered under the
2016 National Agreement, Article 38 and 39 for
which these requests apply.
The Probationary employee received a last right of-
fer on February 16, 2017, but her reason for resign-
ing was not acceptable to management so she was
issued a probationary termination letter. In the
Case: 19-2366 Document: 42 Page: 4 Filed: 07/29/2021
4 ARCENEAUX v. IRS
termination letter it provided the probationary em-
ployee all avenues of appeal rights she can take
(MSPB, EEO, FLRA, OSC, OPM) should she wish
to appeal her termination.
J.A. 36–37. The Union disagreed, arguing that “the em-
ployee obtained full appeal and contractual rights before
she received a termination letter so now we have due pro-
cess rights issues.” J.A. 36. The Union also contended that
“[a]n employee may resign and state any reason they
want,” so the IRS should not have rejected her resignation.
J.A. 36. The IRS ended this series of communications with
an email on March 14, 2017:
Stating they were forced to resign or coerced to re-
sign is not a voluntary resignation, which is what
management offered the employee. You can disa-
gree all you want. The termination letter provided
the probationary employee all avenues of appeal
rights she can take. . . . This is management’s posi-
tion and my final reply.
J.A. 36.
On April 12, 2017, the Union invoked arbitration. The
IRS objected, arguing that the invocation was untimely be-
cause the February 17, 2017 letter was the IRS’s “final de-
cision,” which began the 30-day clock to invoke arbitration.
The arbitrator agreed with the IRS that the invocation of
arbitration was untimely and dismissed the case. 1 J.A. 5–
7.
II
We have jurisdiction to review an arbitrator’s decision
under a collective bargaining agreement under 5 U.S.C.
1 The arbitrator reached this question by assuming
without deciding that Ms. Arceneaux had completed her
probationary period. J.A. 4.
Case: 19-2366 Document: 42 Page: 5 Filed: 07/29/2021
ARCENEAUX v. IRS 5
§§ 7121(f) and 7703(a). We reverse the decision only if it is
“(1) arbitrary, capricious, an abuse of discretion, or other-
wise not in accordance with law; (2) obtained without pro-
cedures required by law, rule, or regulation having been
followed; or (3) unsupported by substantial evidence.”
Miskill v. Soc. Sec. Admin., 863 F.3d 1379, 1382 (Fed. Cir.
2017) (citing 5 U.S.C. §§ 7703(c)(1)–(3)). We agree that the
invocation of arbitration was untimely and therefore af-
firm.
Under the Agreement, if the IRS takes an adverse ac-
tion against a non-probationer employee, the employee has
multiple options for appeal, including binding arbitration.
Agreement, Art. 39, § 6(A). “The [NTEU] must invoke arbi-
tration within thirty (30) days of the date the employee re-
ceives the final decision issued by the [IRS].” Id. at § 6(B).
It is undisputed that Ms. Arceneaux invoked arbitra-
tion more than 30 days after receiving the February 17,
2017 notice from the IRS informing her of her termination.
Thus, the only issue here is whether that notice constituted
a final decision.
Several factors indicate that the February 17, 2017 let-
ter was a final decision. The opening words of the letter
noted that it was a “decision to terminate.” J.A. 30. The de-
cision was effective as of the date of the letter, signaling
finality. Id. The letter also outlined Ms. Arceneaux’s appeal
rights, language typically included in final agency person-
nel decisions and that would be superfluous if the letter
was not a final decision. J.A. 30–31.
Ms. Arceneaux argues that the final decision was in-
stead the IRS’s email on March 14, 2017. But that email
did nothing to render the February 17 decision non-final.
J.A. 36. Unlike the February notice, the March email did
not use the word “decision,” nor did it list appeal rights or
even purport to change the status of the parties. Rather
than indicating that it was a new final decision, the email
referenced the original termination letter and reaffirmed
Case: 19-2366 Document: 42 Page: 6 Filed: 07/29/2021
6 ARCENEAUX v. IRS
its validity. The email’s short statement that it was the
IRS’s “final reply” merely indicated the agency’s desire to
discuss the issue no further.
Ms. Arceneaux also argues that the IRS violated her
procedural rights by removing her without enough advance
notice and without giving her an opportunity to respond.
Appellant’s Br. at 15. But even assuming these rights were
violated, we cannot reinterpret a notice that is clearly the
final decision of the agency to be a notice of proposed action.
The 30-day period to invoke arbitration under the Agree-
ment began when she received the final decision of the
agency, not after her subsequent communications with the
IRS. Removed employees cannot undermine the finality of
removal decisions by corresponding with the employer af-
terwards.
We hold that the IRS’s termination letter on February
17, 2017 was the final decision regarding Ms. Arceneaux’s
removal. Her invocation of arbitration more than 30 days
after the termination letter is therefore untimely under the
Agreement.
III
Because the arbitrator properly dismissed this case as
untimely, we affirm.
AFFIRMED
No costs.
Case: 19-2366 Document: 42 Page: 7 Filed: 07/29/2021
NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
ANGEL L. ARCENEAUX,
Petitioner
v.
INTERNAL REVENUE SERVICE,
Respondent
______________________
2019-2366
______________________
Petition for review of an arbitrator’s decision by Sam-
uel Vitaro.
______________________
NEWMAN, Circuit Judge, dissenting.
This appeal is from the denial of arbitration, as at-
tempted to be invoked by Angel L. Arceneaux and her rep-
resentative the National Treasury Employees Union
(NTEU). The right to arbitrate an adverse employment ac-
tion is established by the National Agreement between the
NTEU and the Treasury (“the Agreement”).
Ms. Arceneaux was terminated by the Internal Reve-
nue Service (IRS or “Agency”), on one day’s written notice.
The NTEU then requested the procedures established in
the Agreement; the IRS refused; and the NETU invoked
arbitration in accordance with the Agreement. The arbi-
trator dismissed the arbitration as untimely, because it
Case: 19-2366 Document: 42 Page: 8 Filed: 07/29/2021
2 ARCENEAUX v. IRS
was not invoked within 30 days of the IRS’s designated “fi-
nal decision. 1” My colleagues agree. I respectfully dissent,
for the IRS action did not conform to the Agreement’s no-
tice and response requirements for a final decision, and did
not start the period for invoking arbitration.
DISCUSSION
The Agreement establishes required procedures for ad-
verse employment actions affecting Treasury employees.
These procedures were not followed in terminating Ms.
Arceneaux, the IRS giving as its reason that she was a pro-
bationary employee. The arbitrator stated that Ms. Arce-
neaux was not a probationary employee; she had been
employed by the IRS since March 2005, with several peri-
ods of leave. At the hearing the arbitrator stated: “I will
not be taking evidence in this threshold proceeding as to
whether Angel Arceneaux was a probationer or not but for
purposes of any arbitrability argument you can assume
that she was not.” Hearing Tr. of May 3, 2018 (Appx. 61).
The arbitrator held that the IRS termination procedure
“was incorrect based on the understanding that the
Grievant was not a probationary employee because it was
issued as if the Grievant was, and misstated the appeal
rights (i.e., not notice of a right to seek arbitration).” Arb.
Dec. at 6.
The IRS procedure terminating Ms. Arce-
neaux violated the Agreement
Ms. Arceneaux was given a letter dated February 16,
2017 stating that a “recommendation has been made” for
her termination effective February 17, 2017. The February
16 letter stated that she could prevent the termination
1 Nat’l Treasury Emps. Union, Chapter 97 v. Dep’t of
Treasury, Internal Revenue Serv. (July 5, 2019) (“Arb.
Dec.”).
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ARCENEAUX v. IRS 3
action by voluntarily resigning. Ms. Arceneaux resigned
on February 17, 2017, writing that her resignation was
“not willing but by force.”
By letter dated February 17, 2017, the IRS rejected her
resignation and stated its “final decision” terminating her
employment effective February 17, 2017.
The NTEU Agreement requires 30 days’ advance notice
of a proposed adverse action, and an opportunity to respond
and receive findings. The Agreement’s Article 39, cap-
tioned “Adverse Actions,” states the several steps of the
agreed procedure; starting with the requirement for 30
days’ notice of the proposed action:
Section 2(A). In all cases of proposed adverse ac-
tion, the employee will be given written notice stat-
ing the specific reasons for the proposed action
thirty (30) days in advance of the action.
Ms. Arceneaux was not given 30 days notice. She was
given one day’s notice on February 16, 2017, of the pro-
posed action effective February 17, 2017.
The Agreement requires that the employee will be
given the opportunity to respond prior to a decision:
Section 2(B). In all cases of proposed adverse ac-
tion . . . the employee will be given the oppor-
tunity . . . to respond orally and/or in writing to the
reasons and specifications prior to a decision on
them provided that the oral and/or written reply is
received by the employer within a reasonable pe-
riod of time after the employee’s receipt of the letter
of proposed action.
Ms. Arceneaux was given no opportunity to respond.
She was invited to resign, but her resignation was not ac-
cepted, and she was terminated effective that same day.
The Agreement also requires the Agency to set forth
findings on each reason and specification for the decision:
Case: 19-2366 Document: 42 Page: 10 Filed: 07/29/2021
4 ARCENEAUX v. IRS
Section 4. An official who sustains the proposed
reasons against an employee in an adverse action
will set forth findings with respect to each reason
and specification against the employee in the notice
of decision. Such notice will also address factual
disputes, if any, raised in the employee’s reply by
stating the reasons why each factual dispute was
rejected.
This requirement also was not met. The IRS provided
no findings for any reason or specification concerning the
termination.
The NTEU on March 10, 2017 asked to reply to the re-
moval of Ms. Arceneaux, writing by email as follows:
As the designated representative of your employee
Angel L Arceneaux we are requesting an oral re-
ply/written reply to the removal dated February 17,
2017 and received on February 23, 2017. I am also
requesting the related evidentiary file.
Appx35. On March 13, 2017, the IRS answered the NTEU,
stating that Ms. Arceneaux is a probationary employee and
is not covered by the Agreement:
Management is unable to fulfil your request for an
oral reply/written reply and evidence relied upon in
regards to the removal of probationary employee
Angel Arceneaux, as she is not covered under the
2016 National Agreement, Article 38 and 39 for
which these requests apply.
Appx36. The NTEU replied the same day, stating that she
was not a probationary employee, and that “the employee
obtained full appeal and contractual rights before she re-
ceived a termination letter so now we have due process
rights issues.” Appx36. The IRS answered on March 14,
2017 that:
Case: 19-2366 Document: 42 Page: 11 Filed: 07/29/2021
ARCENEAUX v. IRS 5
The termination letter provided the probationary
employee all avenues of appeal rights she can take.
This is management’s position and my final reply.
Appx36.
On April 12, 2017 the NTEU invoked arbitration, as
provided in Section 6 of the Agreement’s Article 39:
Section 6(A). If the Employer’s final decision is to
effect an adverse action against a bargaining unit
employee, the employee may appeal the decision to
the Merit Systems Protection Board (MSPB) in ac-
cordance with applicable law, or with the consent
of the NTEU to binding arbitration.
Section 6(B). The NTEU must invoke arbitration
within thirty (30) days of the date the employee re-
ceives the final decision issued by the Employer.
The IRS moved to dismiss the arbitration, stating that
the arbitration request was made after the 30-day period
for invoking arbitration. The arbitrator granted the dis-
missal, despite holding that the IRS violated the Agree-
ment’s procedures.
The February 17 letter cannot be deemed a fi-
nal decision
The IRS position is that the February 17, 2017 letter
was a “final decision,” despite the absence of 30 days’ no-
tice, because “[t]he employment action removing Ms. Arce-
neaux was completed that same day.” IRS Br. 6.
Ms. Arceneaux argues that finality cannot have oc-
curred with the February 17 letter, and that finality of de-
cision could not be earlier than the IRS’s “final reply” to the
NTEU’s request to respond. A “final decision” is the “last
action that settles the rights of the parties and disposes of
all issues in controversy.” Herman v. Local 305, Nat’l Post
Office Mail Handlers, 214 F.3d 475, 479 (4th Cir. 2000).
Case: 19-2366 Document: 42 Page: 12 Filed: 07/29/2021
6 ARCENEAUX v. IRS
Ms. Arceneaux argues that the IRS violation of the
Agreement violated her due process rights, see Cleveland
Bd. of Educ. v. Loudermill, 470 U.S. 532, 542 (1985) (“We
have described ‘the root requirement’ of the Due Process
Clause as being ‘that an individual be given an opportunity
for a hearing before he is deprived of any significant prop-
erty interest.’”) (emphasis in original) (quoting Boddie v.
Connecticut, 401 U.S. 371, 379 (1971). “A due process vio-
lation ‘is not complete when the deprivation occurs; it is not
complete unless and until the State fails to provide due pro-
cess.’” Zinerman v. Burch, 494 U.S. 113, 126 (1990).
The arbitrator observed that the IRS procedure could
“deny [Ms. Arceneaux] certain due process rights to em-
ployment,” Arb. Dec. at 6. Although the IRS violated the
Agreement, the arbitrator held that the February 17, 2017
letter initiated the Agreement’s 30-days limit for invoking
arbitration. The panel majority agrees, postulating that
“even assuming these [Agreement] rights were violated, we
cannot reinterpret a notice that is clearly the final decision
of the agency to be a notice of proposed action.” Maj. Op. at
6. However, the February 17, 2017 letter cannot be deemed
a final decision under the Agreement, for the February 17
letter did not conform to the Agreement.
Ms. Arceneaux proposes that finality occurred no ear-
lier than the Agency’s denial of the NTEU’s request to re-
spond to the termination, for this was a “last action that
settles the rights of the parties.” Herman v. Local 305, 214
F.3d at 479. No stretch of due process can convert an illicit
action into a “final decision” having estoppel consequences.
Nonetheless, the arbitrator held that although Ms.
Arceneaux was denied the required 30 days’ notice and op-
portunity to respond, this did not avoid accrual of the 30-
day period for invocation of arbitration. That cannot be
correct, for the “final decision” under Article 39 is made af-
ter the employee has been given notice and an opportunity
to reply. See Garcia v. Dep’t of Homeland Sec., 780 F.3d
Case: 19-2366 Document: 42 Page: 13 Filed: 07/29/2021
ARCENEAUX v. IRS 7
1145, 1147 (Fed. Cir. 2015) (“[W]e must interpret specific
language in light of the contract as a whole.”). The 30 day
period to invoke arbitration could not accrue until after
these events occurred. My colleagues err in denying arbi-
tration as untimely invoked.
I respectfully dissent.