Covington v. Department of Health and Human Services

• Decision Date: 18 December 1984
• Docket Number: No. 84-976,84-976
• Citation: 750 F.2d 937
• Parties: Elias COVINGTON, Petitioner, v. DEPARTMENT OF HEALTH AND HUMAN SERVICES, Respondent. Appeal
• Court: U.S. Court of Appeals — Federal Circuit

Page 937

750 F.2d 937

Elias COVINGTON, Petitioner, v. DEPARTMENT OF HEALTH AND HUMAN SERVICES, Respondent.

Appeal No. 84-976.

United States Court of Appeals Federal Circuit.

Dec. 18, 1984.

John I. Heise, Jr., Heise, Jorgensen & Stefanellie, P.C., Silver Spring, Md., argued for petitioner. With him on the brief was John P. Rhody, Jr., Silver Spring, Md., of counsel.

M. Susan Burnett, Dept. of Justice, Washington, D.C., argued for respondent.

Richard K. Willard, Acting Asst. Atty. Gen., David M. Cohen, Director, Robert A. Reutershan and Lynn J. Bush, Washington, D.C., Dept. of Justice, were on the brief for appellee. Florence Asnes, Dept. of Health and Human Services, Rockville, of counsel.

Before MILLER, Circuit Judge, SKELTON, Senior Circuit Judge, and NEWMAN, Circuit Judge.

PAULINE NEWMAN, Circuit Judge.

This is an appeal from a final decision of the Merit Systems Protection Board (Board), Case No. DC03518210591. The issue is whether petitioner's retirement from federal service was deemed voluntary or involuntary, in the context of a reduction-in-force action. The Board held petitioner's retirement to be voluntary and therefore dismissed his appeal challenging the agency's action. For the reasons that follow, we reverse the decision of the Board and remand for further proceedings.

I.

Petitioner Elias Covington is a former GS-13 grade employee of the Community Services Administration (CSA). Covington, who held a 5-point veteran's preference, was employed by CSA as a General Supply Specialist with a service computation date of August 24, 1942.

On July 30, 1981 CSA distributed a general reduction-in-force (RIF) notice which informed employees that the President had requested no funding for fiscal year 1982, that CSA might be terminated, and that all CSA positions might be abolished as of September 30, 1981. On August 13, 1981, the Omnibus Budget Reconciliation Act of 1981 (OBRA), Pub.L. No. 97-35, 95 Stat. 358 (1981) was enacted. Title VI of this Act terminated CSA as of October 1, 1981.

On August 21, 1981 Covington received a specific RIF notice informing him that CSA would not exist after September 30, 1981, that his position would be abolished, and that he would be separated due to the RIF effective September 30, 1981. The notice advised Covington that "[b]ecause all positions in your competitive area are being abolished as of September 30, 1981, you have no right of assignment to another position." Since Covington was eligible for an immediate retirement annuity, information concerning benefits of discontinued service retirement was included in the notice. The notice advised Covington that he could appeal the RIF action to the MSPB if he was of the opinion that his rights had been violated.

On September 12, 1981 the CSA union filed suit in the United States District Court for the District of Columbia, alleging that CSA employees had rights under the Veterans Preference Act, 5 U.S.C. Sec. 3503, ¹ to be transferred to the Department of Health and Human Services (HHS) to perform certain activities authorized by OBRA. The union also moved for a preliminary injunction to prevent HHS from filling certain positions under OBRA without first effecting the transfer of CSA employees in accordance with the Veterans Preference Act.

Effective September 30, 1981, Covington retired from federal service for reason of "Abolishment of Agency". The agency treated his retirement as involuntary and established his eligibility for discontinued service retirement. All CSA employees who had not resigned or retired were separated due to RIF on September 30, 1981.

On October 16, 1981 District Judge Penn acted on the union's complaint and permanently enjoined HHS from staffing positions in the Office of Community Services (OCS), CSA's successor, without giving the former CSA employees Veterans Preference rights. Nat'l Council for CSA Locals, American Federation of Government Employees (AFGE), AFL-CIO v. Schweiker, 526 F.Supp. 861 (D.D.C.1981). The district court did not decide whether a transfer of function from CSA to HHS had occurred, nor did it adjudicate the rights of former CSA employees pursuant to 5 U.S.C. Sec. 3503, holding that the former CSA employees had not exhausted their administrative remedies with regard to questions of employee rights pursuant to RIF procedures. 526 F.Supp. at 864-65.

On November 5, 1981 Secretary Schweiker determined that a transfer of function from CSA had occurred with respect to certain activities of OCS. As a result, approximately 180 former CSA employees were appointed to OCS positions retroactively to October 1, 1981. These persons received back pay and all other benefits associated with their retroactive appointments.

On December 5, 1981, as part of the transfer process, HHS officials offered Covington a position as a GS-5 clerk-typist with GS-13 saved pay for two years. Covington declined the offer because his experience was as a property officer.

As of December 21, 1981, approximately 250 former CSA employees had appealed their separation by RIF to the Board. On February 12, 1982 the Board consolidated these appeals and assigned them to the Office of Administrative Law Judges for consideration of common issues of law and fact which were national in scope. On February 15, 1982 Covington appealed the failure of HHS to transfer him to a position identified with a function that was transferred from CSA, and requested consolidation of his appeal with the others. He requested a hearing and stated that he had retired involuntarily.

On August 20, 1982 MSPB Chief Administrative Law Judge McCarthy found that a transfer of function had occurred so that certain former CSA employees had the right to compete for positions at OCS. Certain Former Community Services Administration Employees v. Department of Health and Human Services, MSPB Partial Initial Decision, Decision No. HQ12008110063 (Aug. 20, 1982). Both parties petitioned the Board to review this decision.

While these appeals were pending, on July 15, 1983 HHS moved to dismiss Covington's appeal, arguing that he had retired prior to his separation by RIF and that the Board therefore lacked jurisdiction to hear his appeal. In response to an order to show cause, Covington asserted that his appeal satisfied the requirements of 5 C.F.R. Sec. 351.901, that he had been terminated by a RIF action, and that his retirement was involuntary and not of his own choosing. He provided copies of his RIF notice, his notice of appeal, and his SF 50 involuntary retirement form. This form appears to have been filled out by the agency, is signed by Mr. Robert Davis on behalf of the agency, and states "INVOLUNTARY RETIREMENT, RIF NOTICE DTD 08-21-81" in Block 30 as the reason for Covington's separation. Covington also included a copy of a letter dated July 21, 1983 from the former Director of Personnel for CSA which stated that certain other former CSA employees "may have taken advantage of early retirement, however none of you voluntarily resigned your position" and that "[a]ny records to the contrary are in error."

On August 15, 1983 the presiding official dismissed Covington's appeal for lack of jurisdiction. Covington v. Department of Health and Human Services, Case No. DC3518210591 (Aug. 15, 1983). Observing that a retirement is normally a voluntary action which is not appealable to the Board, the presiding official framed the issue to be whether Covington had presented a non-frivolous allegation that his retirement was wrongfully coerced by the agency. Although the presiding official determined that Covington's "retirement was involuntary, for purposes of [establishing eligibility for discontinued service] retirement", that fact did not "amount to an allegation that his retirement decision was wrongfully extracted by deception or coercive agency action" which would render his retirement involuntary for purposes of establishing Board jurisdiction. Id. at 3.

The presiding official also found that the statement in the RIF notice that no jobs would be available was harmless error which did not mislead Covington because the union had filed a court action prior to the effective date of his retirement. The official concluded that "[w]hile it may have behooved the agency to be more specific so as to inform petitioner that he could retire or be separated by RIF, I do not find the agency's specific notice presented such confusing or misleading information as might work to bring this appeal within the Board's jurisdiction." Id.

In his petition to the full Board to review the presiding official's decision, Covington argued that Gonzalez v. Department of Transportation, 701 F.2d 36 (5th Cir.1983), cited but not followed by the presiding official, required reversal by the Board because he had not been informed that by choosing to retire he would forfeit his right to challenge the agency's action. On January 19, 1984 the Board denied Covington's petition for review; he then appealed to this court.

On June 18, 1984, the Board issued its opinion on review of the ALJ's partial decision of August 20, 1982. The Board's opinion, issued June 18, 1984, modified the decision of the ALJ but agreed that the agency had failed to match the continuing functions with those individual employees who had been identified with those functions prior to the transfer. Accordingly, the petitioners were entitled to continue their individual appeals at the local level:

The effects of this agency error as it relates to each appellant have yet to be determined. Upon remand, each individual appellant must be afforded an opportunity to present with some degree of specificity, evidence which tends to establish that he was denied retention to which he was otherwise entitled under 5 C.F.R. 351.303. Debold v. Department of the Navy, 9 MSPB 95 (1982).

It is therefore incumbent upon each appellant to assert that he was identified with a continuing function that is now being...