Lisa J. Hess v. United States Postal Service , 2016 MSPB 40 ( 2016 )

UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD
2016 MSPB 40
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the agency rescinded the action, removed all references thereto from the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
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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.
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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.