Christian v. New York State Department of Labor, Division of Employment 8212 5704

• Decision Date: 21 January 1974
• Docket Number: No. 72,72
• Citation: 414 U.S. 614,39 L.Ed.2d 38,94 S.Ct. 747
• Parties: Jean CHRISTIAN and Victor L. Green, Appellants, v. NEW YORK STATE DEPARTMENT OF LABOR, DIVISION OF EMPLOYMENT, et al. —5704
• Court: U.S. Supreme Court

414 U.S. 614

94 S.Ct. 747

39 L.Ed.2d 38

Jean CHRISTIAN and Victor L. Green, Appellants,

v NEW YORK STATE DEPARTMENT OF LABOR, DIVISION OF EMPLOYMENT, et al.

No. 72—5704.

Argued Nov. 13, 1973.

Decided Jan. 21, 1974.

Syllabus

Appellants, former federal probationary employees who were denied benefits under the Unemployment Compensation for Federal Employees Program brought this action in District Court seeking declaratory and injunctive relief against provisions of the Program and its implementing regulations that they contended operated to deny them a hearing on the factual basis for their removal from federal service, for the purpose of determining their eligibility under state law for unemployment compensation. They claimed that the Act requires such a hearing and, alternatively, that the denial of a hearing deprived them of due process and equal protection. A three-judge District Court held that the statute does not require a hearing to contest the employing agency's findings; dismissed the constitutional claims against the federal defendants for lack of subject-matter jurisdiction; and held that the state agency's denial of a hearing did not violate the Due Process or Equal Protection Clauses. Held: Any decision upon appellants' statutory or constitutional claims would be premature in view of the fact that the record does not disclose that the state agency, in notifying appellants of the adverse determinations, informed them, as it was required to do by the applicable regulation, of their 'right to additional information or reconsideration and correction' of the findings by the employing agencies; or that appellants invoked the available procedure entitling them to request their agencies 'to reconsider and correct' those findings. The District Court's dismissal of the suit as to both federal and state defendants is therefore vacated with directions that the court determine whether appellants should be permitted to invoke the applicable administrative procedures. Pp. 618—624.

347 F.Supp. 1158, vacated.

E. Richard Larson, New York City, for appellants.

Mark L. Evans, Washington, D.C., for appellees.

Mr. Justice BRENNAN delivered the opinion of the Court.

Appellants, discharged federal probationary employees, were denied unemployment compensation by the New York State Department of Labor, an 'agent of the United States' under agreement with the Secretary of Labor for the administration of the Unemployment Compensation for Federal Employees (UCFE) Program, 5 U.S.C. § 8501 et seq. Appellants brought this class suit against that state agency in the District Court for the Southern District of New York, joining as defendants the United States Department of Labor, which is charged with overall responsibility for the program, and the United States Post Office Department and Department of the Treasury, which are appellants' former employing agencies.

Appellants alleged that the state agency had based its adverse determinations on findings of fact made ex parte by the federal employing agencies, and that the state agency had refused to afford either appellant a hear- ing at which he or she could attempt to contest those federal findings. The result, appellants claimed, was a deprivation of any opportunity to be heard, in violation of the UCFE statutes and of the Fifth and Fourteenth Amendments. They sought certification as representatives of the class of persons similarly situated, the convening of a three-judge court, and declaratory, injunctive, and mandamus relief.

The District Court viewed the suit as a constitutional attack on 5 U.S.C. § 8506(a),¹ which, inter alia, makes the findings of the federal employing agency 'final and conclusive' on the state agency, and on the regulations of the Secretary of Labor promulgated, pursuant to 5 U.S.C. § 8508, to enforce the program.² A three-judge court was convened. That court, in an opinion reported at 347 F.Supp. 1158 (1972), first examined the statutory claim and held that § 8506(a) does not require that appellants receive either a state or a federal hearing to contest the employing agency's findings. Next, the court noted that jurisdiction over the claims against the federal defendants had been alleged only under 28 U.S.C. § 1361, providing for mandamus actions. Holding that § 1361 will not support a constitutional challenge to a statute, the court dismissed the constitutional claims against the federal defendants for lack of subject-matter jurisdiction.³ Finally, turning to the constitutional claims against the state defendants, the court, apparently assuming for purposes of argument that the federal defendants were not constitutionally required to afford appellants a hearing, treated the claims as asserting that denial of a state hearing was, in effect, a denial of any hearing on the federal findings. The court held that the denial of a hearing by the state agency did not violate either the Due Process or the Equal Protection Clauses.

We noted probable jurisdiction of appellants' appeal, 411 U.S. 930, 93 S.Ct. 1904, 36 L.Ed.2d 389 (1973). We are of the view that decision upon appellants' statutory and constitutional claims would be premature. We cannot discover in the record that the state agency, in notifying appellants of the adverse determinations, informed them, as required by 20 CFR § 609.20, of their 'right to additional information or reconsideration and correction' of the findings by the employing agencies. Nor can we discover from the record whether or not appellants invoked 20 CFR § 609.23, entitling them to request their employing agencies 'to reconsider and correct' those findings.

The 'findings' of appellant Christian's federal employer, the United States Post Office Department, were that Christian was discharged because of excessive absences. The 'findings' of appellant Green's employer, the Department of the Treasury, were that Green was discharged for consuming an alcoholic beverage within 24 hours of going on duty as a sky marshal. It is clear that neither was afforded a prior hearing by his or her agency or any opportunity to challenge the justifications for discharge.⁴ Each then applied for unemployment compensation through the New York State Department of Labor. As required by § 8506, New York requested and obtained from each agency its 'findings' describing the nature of the employment, including the reasons for the discharge. On the basis of those findings, the state officials made an initial determination that neither appellant qualified for compensation under the applicable state standards.⁵

We find nothing whatever in the record to show compliance by the state agency with 20 CFR § 609.20. All that appears is that the New York officials sent each appellant a letter that included (a) a recitation that no employment benefits could be paid, (b) the state rule that required that conclusion, (c) a short summary of the findings of the federal agency, and (d) a statement that the individual could request a hearing before an impartial state referee. Indeed, the letter appears to be a form letter appropriate in cases of private and state employee applicants, but not tailored for the situation of the federal employee applicant given rights of reconsideration and correction by the Secretary's regulations.

Appellant Christian requested and obtained a hearing before a state referee. The referee permitted her to introduce evidence to rebut the federal findings, credited that evidence, and recommended that she be provided unemployment compensation. The state Appeals Board, however, reversed on the ground that § 8506 prohibited re-examination of the facts found by the federal agency. Appellant Green had not obtained a hearing at the time this suit was filed, and the record does not disclose whether he requested one.⁶

The UCFE Program does not, as the state Appeals Board recognized, contemplate a hearing before the state agency for correction of factual findings of the federal employer. But, while prohibiting state re-examination of the facts, § 8506(a) also requires an opportunity for federal re-examination:

'The regulations (promulgated by the Secretary of Labor) shall include provision for correction by the employing agency of errors and omissions. Findings made in accordance with the regulations are final and conclusive for the purpose of (state adjudication).'

The regulations promulgated by the Secretary of Labor plainly attach great significance to the right of the discharged employee to have the employing agency reconsider its stated reasons for his discharge. The crucial requirement that triggers this reconsideration is the obligation imposed upon the state agency to notify the applicant of the content of the federal findings, which notice 'shall (also) inform the Federal civilian employee of his right to additional information or reconsideration and correction of such findings.' 20 CFR § 609.20. Thereupon, the employee may obtain additional infor- mation from the employing agency concerning the basis of its findings, § 609.22. Whether or not he avails himself of that opportunity, he may file a request for reconsideration and correction, 'together with such information as supports his request, through the State agency before which the claim is pending . . ..' § 609.23. Upon receipt of such a request, the federal agency must consider any information submitted by the employee, promptly correct any errors or omissions, and either affirm, modify, or reverse its original findings in writing. § 609.9. Finally, the State is required to stay its adjudicatory process pending federal reconsideration, although it is conclusively bound by any factual findings of the federal agency, §§ 609.23(a), 609.18(c), when it applies its own law to redetermine eligibility. §§ 609.24(c), (d).

Appellants' contention that § 8506(a) works a denial of due process and equal protection by depriving them of a hearing before the state agency is thus misdirected....