Ronald Cogan v. United States Postal Service

UNITED STATES OF AMERICA

MERIT SYSTEMS PROTECTION BOARD

RONALD COGAN, DOCKET NUMBER

Appellant, CH-0752-14-0197-I-1

v.

UNITED STATES POSTAL SERVICE, DATE: October 6, 2014

Agency.

THIS ORDER IS NONPRECEDENTIAL 1

Ronald Cogan, Canton, Ohio, pro se.

James E. Campion, Jr., Esquire, Philadelphia, Pennsylvania, for the agency.

BEFORE

Susan Tsui Grundmann, Chairman

Anne M. Wagner, Vice Chairman

Mark A. Robbins, Member

REMAND ORDER

¶1 The appellant has filed a petition for review of the initial decision, which

dismissed his appeal of his reduction in grade for lack of jurisdiction. For the

reasons discussed below, we GRANT the appellant’s petition for review,

1

A nonprecedential order is one that the Board has determined does not add

significantly to the body of MSPB case law. Parties may cite nonprecedential orders,

but such orders have no precedential value; the Board and administrative judges are not

required to follow or distinguish them in any future decisions. In contrast, a

precedential decision issued as an Opinion and Order has been identified by the Board

as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).

2

VACATE the initial decision, and REMAND the case to the regional office for

further adjudication in accordance with this Order.

DISCUSSION OF ARGUMENTS ON REVIEW

¶2 The appellant, a preference-eligible veteran, worked as a Building

Equipment Mechanic, PS-9, at the agency’s Processing and Distribution Facility

in Canton, Ohio. Initial Appeal File (IAF), Tab 1 at 1, Tab 7 at 16. In

September 2013, the appellant transferred to the position of Building

Maintenance Custodian at the agency’s Post Office in Brunswick, Ohio, with

saved grade and the same rate of pay. IAF, Tab 7 at 15. The transfer was due to

the agency’s Area Mail Processing consolidation. Id. at 15, 41-43. The

appellant initiated a Board appeal challenging his placement, alleging a

reduction in pay or grade and failure to restore/reemploy/reinstate or improper

restoration/reemployment/reinstatement. IAF, Tab 1 at 3. The administrative

judge issued an acknowledgment order directing the appellant to file evidence

and argument to show that the Board had jurisdiction over the appeal. IAF,

Tab 2 at 2. The appellant responded to the order and alleged the agency had

engaged in an improper reduction in force (RIF). IAF, Tab 4 at 3-4. The

administrative judge then issued a show cause order directing the appellant to

again provide evidence and argument to show that the Board had jurisdiction

over the appeal. IAF, Tab 10 at 2. The appellant responded to the order and

argued that he had been reduced in grade because the new position was a level

five when he had previously been a level nine. 2 IAF, Tab 11 at 5.

¶3 The administrative judge issued an initial decision that dismissed the appeal

for lack of jurisdiction without holding the requested hearing. IAF, Tab 14,

2

The appellant appears to have mistakenly referenced the position as a level four in his

response. The position description submitted by the appellant and the appellant’s

petition for review both refer to the position as being a level five. IAF, Tab 11 at 6-8;

Petition for Review (PFR) File, Tab 1 at 4. For the sake of consistency, we will rely on

the designation in the position description.

3

Initial Decision (ID) at 1, 3. She found that the appellant had not been reduced

in pay or grade because the agency had provided him with both saved pay and

saved grade. ID at 3. She also found that, because the appellant did not suffer a

reduction in pay or grade, the Board lacked jurisdiction over his reassignment

appeal. ID at 2-3. The appellant has filed a timely petition for review. PFR

File, Tab 1. The agency has responded in opposition to the appellant’s petition

for review. PFR File, Tabs 3 and 5.

The appeal must be remanded to provide the appellant with notice of how he can

establish jurisdiction over an alleged RIF action.

¶4 The Board does not have jurisdiction over all matters involving a federal

employee that are allegedly unfair or incorrect. Miller v. Department of

Homeland Security, 111 M.S.P.R. 325, ¶ 14 (2009), aff’d, 361 F. App’x 134

(Fed. Cir. 2010). The Board’s jurisdiction is not plenary; it is limited to those

matters over which it has been given jurisdiction by law, rule or regulation.

Maddox v. Merit Systems Protection Board, 759 F.2d 9, 10 (Fed. Cir. 1985). The

appellant bears the burden of showing that the Board has jurisdiction over his

appeal. 5 C.F.R. § 1201.56(a)(2)(i).

¶5 In response to the administrative judge’s acknowledgment order, the

appellant alleged that the reassignment was an improper RIF assignment under

the collective bargaining agreement (CBA) between the agency and the

American Postal Workers Union. IAF, Tab 4 at 3-4. Under these circumstances,

the administrative judge should have advised the appellant of how to establish

Board jurisdiction over a RIF appeal. When the Board’s jurisdiction is in doubt,

an appellant must receive explicit information on what is required to establish an

appealable jurisdictional issue. Alvarez v Department of Homeland

Security, 112 M.S.P.R. 434, ¶ 9 (2009) (citing Burgess v. Merit Systems

Protection Board, 758 F.2d 641, 643-44 (Fed. Cir. 1985)).

¶6 A RIF is an administrative procedure by which agencies eliminate jobs for

certain listed reasons, including lack of work or reorganization, and release

4

employees from their competitive levels by furlough of more than 30 days,

separation, demotion, or reassignment requiring displacement. 5 C.F.R.

§ 351.201(a)(2); Burger v. U.S. Postal Service, 93 M.S.P.R. 582, ¶ 9 (2003),

aff’d, 390 F.3d 1373 (Fed. Cir. 2004). The Postal Service must follow the RIF

regulations set out in 5 C.F.R. part 351 when it releases a preference-eligible

employee from his original position to a lower-grade position for a reason

covered by the RIF regulations. 3 Buckheit v. U.S. Postal Service, 107 M.S.P.R.

52, ¶ 11, n.5 (2007); Brown v. U.S. Postal Service, 58 M.S.P.R. 345, 347-48

(1993). Even placement of an employee in an indefinite saved pay and saved

grade status will require compliance with the RIF regulations if the new position

is at a lower-grade level. Adams v. U.S. Postal Service, 77 M.S.P.R. 368, 370

(1998).

¶7 Here, the appellant has alleged that he was subject to a RIF. IAF, Tab 4

at 3-4. Thus, to be entitled to a jurisdictional hearing over his RIF claim, the

appellant must make a nonfrivolous allegation that he was subjected to an

appealable RIF in the form of a demotion, separation, or furlough for more than

30 days. Harrell v U.S. Postal Service, 112 M.S.P.R. 492, ¶ 11 (2009); Adams v.

Department of Defense, 96 M.S.P.R. 325, ¶ 9 (2004); 5 C.F.R. § 351.901.

Further, the appellant must show that his reassignment was involuntary. 4

3

The parties agree that the appellant is a preference-eligible employee. IAF, Tab 1

at 1, Tab 7 at 4.

4

The agency alleges that the appellant’s reassignment was voluntary because it

occurred after he was reassured that he would not be involuntarily reassigned to a

lower-level position. IAF, Tab 13 at 4. However, the Postal Service (PS) Form 50

documenting the transfer reflected an involuntary reassignment. IAF, Tab 7 at 4, 15.

An appellant claiming an involuntary demotion by RIF must establish, by preponderant

evidence, that two things happened. Burger, 93 M.S.P.R. 582, ¶ 13. First, he must

show that he bid to and accepted a lower-grade position after the agency actually

informed him that his original position had in fact been abolished. Id. Second, he must

prove that his bid to and acceptance of a lower-grade position occurred after the agency

expressly notified him that he would not be assigned to a position at the same grade as

the position which was abolished. Id.

5

Burger, 93 M.S.P.R. 582, ¶ 13. On remand, the administrative judge should

advise the appellant of his jurisdictional burden regarding a RIF appeal and

provide him the opportunity to submit evidence and argument on this issue.

The appeal must be remanded for a determination of whether the appellant

waived his Board appeal rights in his reassignment letter.

¶8 The agency argued that the appellant waived his Board appeal rights. IAF,

Tab 13 at 4-5. The agency submitted a copy of the letter, titled “Veteran

Preference Waiver Letter,” that states that, as “a preference eligible employee”

and in accordance with the CBA, he could only be assigned into vacancies at the

same level as his former position. The letter also includes the following

statement:

Prior to voluntarily signing this form, I hereby state that I have

read, and completely understand the conditions set forth in this

letter. I am mentally and physically fit so as to be able to

understand the terms and conditions of this letter. In addition,

I understand that I am freely waiving my rights to Merit

[Systems] Protection Board for any claims resulting from my

position being abolished; and my being placed into a lower

level position was based on my personal preference of choice.

I freely sign this letter of selection without reservation, and

recognize that this selection is being made without duress, or

coercion on the part of anyone.

Id. at 7. Although it is not clear, it appears the appellant may have signed this

letter to get a preferential bid on an assignment. The administrative judge did

not address this letter in her decision or advise the appellant that he may have

waived his Board appeal rights, and how he could challenge such a waiver.

¶9 The Board has acknowledged that an employee can waive his right to appeal

in certain circumstances, most often in a settlement agreement. Cooper v.

Department of Veterans Affairs, 117 M.S.P.R. 611, ¶ 6 (2012), aff’d, 515 F.

App’x 897 (Fed. Cir. 2013). The Board will consider an agreement reached

outside of Board proceedings to determine its effect on the Board appeal and any

waiver of Board appeal rights. See Lee v. U.S. Postal Service, 111 M.S.P.R. 551,

6

¶ 4 (2009) (settlement agreement reached to resolve equal employment

opportunity complaint waived appellant’s right to bring appeal over same matters

to the Board), aff’d, 367 F. App’x 137 (2010). When an individual is already

employed by the agency and had the right to appeal to the Board, he must receive

bargained-for consideration from the agency for the waiver of appeal rights to be

a valid, enforceable contract. Thompson v. Department of the

Treasury, 100 M.S.P.R. 545, ¶ 9 (2005) (citing Hughes v. Social Security

Administration, 99 M.S.P.R. 67, ¶ 7 (2005)); see generally Blum v. United

States, 120 Ct. Cl. 232 (1951) (the court reviewed whether it was appropriate for

an employee who, in order to avoid resigning, agreed to separate from the agency

pursuant to a RIF and thereby waive his rights under the Veterans’ Preference

Act).

¶10 An appellant may challenge the enforceability of a waiver of Board appeal

rights. Lee, 111 M.S.P.R. 551, ¶ 4. The waiver of appeal rights will be

enforceable if its terms are comprehensive, freely made, and fair, and the

execution of the waiver did not result from agency duress or bad faith. Id.

Because the administrative judge failed to adjudicate the agency’s claim of

waiver, this issue must be remanded. The administrative judge must provide the

appellant with notice on how he may challenge the enforceability of a waiver of

Board appeal rights. On remand, the parties should address not only the

enforceability of the waiver, but also the issue of what consideration, if any, the

appellant received for his waiver. If the appellant makes a nonfrivolous

allegation that the waiver is invalid or unenforceable, then he is entitled to a

jurisdictional hearing on this issue.

The administrative judge properly found that the appellant did not suffer an

appealable chapter 75 adverse action.

¶11 The administrative judge found that the appellant had not suffered a

reduction in pay or grade when he took the new position with retained grade and

no loss of pay. ID at 3. Therefore, she concluded that the Board lacked

7

jurisdiction over the appeal. ID at 3. The appellant argues on review that he was

subjected to a reduction in grade because he was involuntarily reassigned to a

lower-level position. PFR File, Tab 1 at 4.

¶12 The Board generally has jurisdiction to review an appeal of a reduction in

grade or pay. Simmons v. Department of Housing & Urban

Development, 120 M.S.P.R. 489, ¶ 5 (2014); see 5 U.S.C. § 7512(3)-(4). The

term grade is defined as “a level of classification under a position classification

system.” 5 U.S.C. § 7511(a)(3). The Board has previously found that it does not

have jurisdiction over appeals when an employee is reassigned with retained

grade. Pascarella v. Consumer Product Safety Commission, 13 M.S.P.R. 48, 49

(1982). Here, the appellant’s PS Form 50 reflects that his new position is subject

to saved grade, and he retained the same grade and step as his prior position.

IAF, Tab 7 at 15-16. The appellant argues that he has been reduced to a grade

five position from a grade nine position, but the PS Form 50 that reflects no

reduction in grade occurred. PFR File, Tab 4 at 3; IAF, Tab 7 at 15. The

appellant has not made a nonfrivolous allegation that he suffered an appealable

reduction in grade.

¶13 For adverse action purposes, pay means “the rate of basic pay fixed by law

or administrative action for the position held by an employee.” 5 U.S.C.

§ 7511(a)(4). Thus, a reduction in pay is appealable only when this rate

decreases. Gaydar v. Department of the Navy, 121 M.S.P.R. 357, ¶ 6 (2014).

There is no indication that the appellant’s pay has been reduced or will be

reduced in the future. Contrary to the appellant’s claim, he actually received a

pay increase on November 16, 2013. IAF, Tab 7 at 15. Therefore, the appellant

has not demonstrated that he suffered an appealable reduction in pay.

¶14 Because we are remanding the case for further jurisdictional proceedings,

the administrative judge must issue a new initial decision addressing whether the

appellant was subject to an involuntary appealable RIF action when he was

reassigned to his present position and whether he waived his Board appeal rights

8

regarding that reassignment. On remand, if the administrative judge determines

the appellant was not subject to a RIF, then she may incorporate her original

findings that the Board lacked jurisdiction over the appeal under chapter 75

because the appellant did not suffer an appealable reduction in grade or pay.

ORDER

For the reasons discussed above, we REMAND this case to the regional

office for further adjudication in accordance with this Remand Order.

FOR THE BOARD: ______________________________

William D. Spencer

Clerk of the Board

Washington, D.C.