Lal v. Merit Systems Protection Board

United States Court of Appeals

for the Federal Circuit

______________________

RENU B. LAL,

Petitioner

v.

MERIT SYSTEMS PROTECTION BOARD,

Respondent

DEPARTMENT OF HEALTH AND HUMAN

SERVICES,

Intervenor

______________________

2015-3140

______________________

Petition for review of the Merit Systems Protection

Board in No. DC-0752-14-0852-I-1.

______________________

Decided: May 11, 2016

______________________

GEORGE CHUZI, Kalijarvi, Chuzi, Newman & Fitch,

P.C., Washington, DC, argued for petitioner. Also repre-

sented by RICHARD RANDOLPH RENNER.

CALVIN M. MORROW, Office of the General Counsel,

Merit Systems Protection Board, Washington, DC, argued

for respondent. Also represented by BRYAN G. POLISUK.

2 LAL v. MSPB

RETA EMMA BEZAK, Commercial Litigation Branch,

Civil Division, United States Department of Justice,

Washington, DC, argued for intervenor. Also represented

by BENJAMIN C. MIZER, ROBERT E. KIRSCHMAN, JR.,

REGINALD T. BLADES, and ERIN K. MURDOCK-PARK.

______________________

Before MOORE, O’MALLEY, and HUGHES, Circuit Judges.

HUGHES, Circuit Judge.

Renu Lal was terminated from her position as a dis-

tinguished consultant at the Centers for Disease Control,

a component of the Department of Health and Human

Services. Ms. Lal appealed her removal to the Merit

Systems Protection Board, which concluded that it lacked

jurisdiction over Ms. Lal’s removal because she had been

appointed pursuant to 42 U.S.C. § 209(f), “without regard

to the civil-service laws.” While we agree with the Board

that § 209(f) places Ms. Lal into the excepted service, it

does not exempt her from the Civil Service Due Process

Amendments of 1990, which provide appeal rights to

certain excepted service employees. Accordingly, we

reverse the Board’s decision and remand for further

proceedings.

I

Ms. Lal was appointed as a distinguished consultant

in the excepted service pursuant to § 209(f), which pro-

vides that consultants “may be appointed without regard

to the civil-service laws.” The agency understood this to

mean that Ms. Lal was not subject to the statutory due

process requirements of the civil-service laws under title 5

of the United States Code, and terminated her employ-

ment without providing notice of the termination or a

right to respond, as would ordinarily be required by the

civil-service laws. Ms. Lal appealed to the Board, which

concluded that § 209(f)’s “appointed without regard to the

LAL v. MSPB 3

civil-service laws” language deprived the Board of juris-

diction. Ms. Lal appeals.

II

Our review of the Board’s decisions is limited by stat-

ute. Under 5 U.S.C. § 7703(c), we set aside any action,

finding, or conclusion that is: (1) arbitrary, capricious, an

abuse of discretion, or otherwise not in accordance with

the law; (2) obtained without procedures required by law,

rule, or regulation having been followed; or (3) unsupport-

ed by substantial evidence. The Board’s determination

that it lacked jurisdiction is a question of law that we

review de novo. Bennett v. Merit Sys. Prot. Bd., 635 F.3d

1215, 1218 (Fed. Cir. 2011). “The [Board’s] jurisdiction is

limited to those matters over which it has been given

jurisdiction by law, rule or regulation.” Id. And, “[a]s the

petitioner, [Ms. Lal] bears the burden of proving the

[Board’s] jurisdiction over her appeal by a preponderance

of the evidence.” Id.

Title 5 limits the Board’s jurisdiction over federal

workers’ appeals based on both the nature of the person-

nel action being contested and the employment status of

the individual complainant. 5 U.S.C. §§ 7701(a), 7512,

7513(d). “Taken together, these statutory provisions

make clear that tenured employees—those individuals

who meet the definition of an ‘employee’ set forth in

§ 7511—can seek Board review of adverse actions as

defined in § 7512, including removals.” Archuleta v.

Hopper, 786 F.3d 1340, 1348 (Fed. Cir. 2015). Here, there

is no dispute that Ms. Lal fits within the statutory defini-

tion of “employee,” and is entitled to appeal rights unless

otherwise excepted by statute. For the reasons set forth

below, we agree with Ms. Lal that § 209(f) does not pro-

vide such an exception.

We begin, as we must, with the plain language of

§ 209(f), which provides:

4 LAL v. MSPB

In accordance with regulations, special consult-

ants may be employed to assist and advise in the

operations of the [Public Health] Service. Such

consultants may be appointed without regard to

the civil-service laws.

The plain language of the statute only speaks in terms of

appointment authority, and does not discuss the removal

of the employee. Because the statute does not include an

explicit reference to removal ability, we must determine if

the Civil Service Due Process Amendments of 1990 ex-

tended appeal rights to employees appointed under

§ 209(f). If so, the Board has jurisdiction over Ms. Lal’s

appeal.

“It is a ‘fundamental canon of statutory construction

that the words of a statute must be read in their context

and with a view to their place in the overall statutory

scheme.’” Food and Drug Admin. v. Brown & Williamson

Tobacco Corp., 529 U.S. 120, 133 (2000) (quoting Davis v.

Michigan Dept. of Treasury, 489 U.S. 803, 809 (1989)). “A

court must therefore interpret the statute ‘as a symmet-

rical and coherent regulatory scheme,’ and ‘fit, if possible,

all parts into an harmonious whole.’” Id. (internal cita-

tions omitted).

Section 209(f) was enacted as part of the Public

Health Service Act of 1944, which codified existing rules

and regulations surrounding the operation of the Public

Health Service, including the Public Health Commis-

sioned Corps. See, e.g., H.R. Rep. No. 78–1364, at 1–4

(1944). As explained by the Surgeon General at the time,

the Act provided for “a closely knit, highly trained com-

missioned corps of officers, who are specialists in public

health, medicine, scientific research, and related special-

ists, as the best type of administrative structure to deal

with national and international health problems.” Alan-

son Wilcox, Public Health Service Act, 1944, 7 Soc. Sec.

Bull., Aug. 1944, at 15 (quoting Surgeon General Thomas

LAL v. MSPB 5

Parran). To that end, what is now the Secretary of

Health and Human Services was given authority to

appoint “any officer or employee of the Service . . . in

accordance with the civil-service laws.” 42 U.S.C. § 209(i).

But, “[w]hen the Public Health Service requires the

services of consultants who cannot be obtained when

needed through regular Civil Service appointment . . . ,

special consultants to assist and advise the operations of

the Service may be appointed,” 42 C.F.R. § 22.3(a), pursu-

ant to § 209(f), “without regard to the civil-service laws.”

To put it more simply, § 209(f) permits the Secretary to

hire consultants into the excepted service.

As the civil-service laws matured, section 209(f) re-

mained substantively unchanged. The Civil Service

Reform Act of 1978 (CSRA) “comprehensively overhauled

the civil service system,” creating “a new framework for

evaluating adverse personnel actions against ‘employees’”

within the newly formed Merit Systems Protection Board.

Lindahl v. Office of Pers. Mgmt., 470 U.S. 768, 774 (1985).

The CSRA “prescribes in great detail the protections and

remedies applicable to” actions taken against certain

federal employees, “including the availability of adminis-

trative and judicial review.” United States v. Fausto, 484

U.S. 439, 443 (1988). As is relevant here, the CSRA

extended certain benefits, including the right to adminis-

trative review by the Board and appeal rights to this

court, to individuals in the competitive service and “cer-

tain veterans and their close relatives—so-called ‘prefer-

ence eligibles,’” in the excepted service. Id. at 441 n.1.

But the CSRA did not extend these benefits to non-

preference eligible members of the excepted service.

Recognizing a gap in administrative and judicial ap-

peal rights for non-preference eligible members of the

excepted service, Congress enacted the Civil Service Due

Process Amendments of 1990 (the Due Process Amend-

ments), Pub.L. No. 101-376, 104 Stat. 461 (Aug. 17, 1990)

(codified in relevant part at 5 U.S.C. § 7511)). See Ben-

6 LAL v. MSPB

nett, 635 F.3d at 1220 (recognizing that Congress enacted

the Due Process Amendments in response to the Supreme

Court’s decision in Fausto, where the Court held that the

CSRA precluded judicial review for non-preference eligi-

ble members of the excepted service); see also H.R. Rep

No. 101-328, at 1 (1989), reprinted in 1990 U.S.C.C.A.C.

695 (“The key difference between the protections available

to competitive service employees and preference eligibles

in the excepted service, on the one hand, and excepted

service employees who are not preference eligibles, on the

other, is the right to appeal an adverse action to the Merit

Systems Protection Board for independent review.”). The

Due Process Amendments broadened the CSRA’s defini-

tion of covered employees to include non-preference

eligible individuals in the excepted service “who [are] not

serving a probationary or trial period under an initial

appointment pending conversion to the competitive ser-

vice,” or “who [have] completed 2 years of current contin-

uous service in the same or similar positions in an

Executive agency under other than a temporary appoint-

ment limited to 2 years or less . . . .” 5 U.S.C.

§ 7511(a)(1)(C).

The Due Process Amendments also include a list of

categories of individuals who are excluded from title 5

protection, although they would ordinarily fall within the

broad definition of “employee” set forth in § 7511(a)(1).

See 5 U.S.C. § 7511(b)(1)–(10). In addition to excluding

political appointees and confidential or policy making

positions, the Due Process Amendments also list seven

additional categories of individuals that are excluded from

§ 7511’s reach. Many of these categories were either

expressly excluded by existing statute or regulation, or

already subject to an appeal regime within a particular

agency. For example, § 7511(b) excludes employees of the

Central Intelligence Agency, the General Accounting

Office, and the Veterans Health Services—all of whom

were already excluded from the Board’s appeals process.

LAL v. MSPB 7

See H.R. Rep. No. 101-328, at 5, 6–7 (1989) (“The National

Security Act of 1946 provides the Director of the Central

Intelligence Agency (CIA) with plenary authority to deal

with personnel of the CIA. The General Accounting Office

Personnel Act of 1980 provides comparable procedural

rights for GAO employees through the GAO personnel

Appeals Board. The employees at the Veterans Health

Services and Research Administration are subject to a

special peer review system.”).

With that context in mind, we find that § 209(f) mere-

ly ensures that the Secretary has the authority to hire

individuals into the excepted service. And, after the Due

Process Amendments, non-preference eligible members of

the excepted service who, like Ms. Lal, have “completed 2

years of continuous service in the same or similar posi-

tions,” 5 U.S.C. § 7511(a)(1)(C), and who do not fall within

one of the enumerated excluded categories of individuals

in § 7511(b), are “employees” ordinarily entitled to appeal

rights at the Board. This conclusion is consistent with

our precedent in Todd v. Merit Systems Protection Board,

55 F.3d 1574 (Fed. Cir. 1995), and its progeny. That

precedent stands for the proposition that, absent a specif-

ic exclusion of appeal rights or exemption from § 7511’s

definition of employee, a statute exempting an appoint-

ment from the civil-service laws cannot escape the broad

reach of Due Process Amendments and therefore does not

strip the Board of jurisdiction to hear an appeal from an

adverse action.

In Todd, we analyzed 20 U.S.C. § 241(a), which per-

mitted certain “local installations to employ personnel

whose ‘compensation, tenure, leave, hours of work, and

other incidents of the employment relationship may be

fixed without regard to the Civil Service Act and rules

and the following: . . . (4) sections . . . 7511, 7512, and

7701 of Title 5.’” 55 F.3d at 1578 (quoting § 241(a)). We

found that this statutory language was sufficient to

exempt the petitioner from appeal rights and we rejected

8 LAL v. MSPB

the argument that the Due Process Amendments implied-

ly repealed § 241(a). See id. It was of no consequence

that the Due Process Amendments expanded the defini-

tion of “employee” under § 7511 because 20 U.S.C.

§ 241(a) explicitly exempted hired personnel from the

definition of “employee” in § 7511. See Todd, 55 F.3d at

1577–78 (rejecting the argument that “the general provi-

sions of section 7511(a)(1)(C) trump specific exceptions of

section 241(a)”). Indeed, given that § 241(a) excluded

preference-eligible members before the enactment of the

Due Process Amendments, see Pub. Law. 89-77, 79 Stat.

243 (July 21, 1965) (explaining that the Veterans Prefer-

ence Act of 1944 does not apply), and the Due Process

Amendments were intended to give the same benefits to

non-preference excepted service members as those held by

preference eligible excepted service members, see supra at

5–6, it is not surprising that the Due Process Amend-

ments could not be read to give additional appeal rights to

the petitioner in Todd.

A key factor in Todd was § 241(a)’s explicit reference

to the statutory provisions granting appeal rights. See

King v. Briggs, 83 F.3d 1384, 1388 (Fed. Cir. 1996) (“[A]s

Todd amply demonstrates, Congress knows how to ex-

empt a civil service position from the protections found in

chapters 75 and 77 of title 5 if it so desires.”). Thus, we

found in Todd that “there is no irreconcilability or repug-

nancy between the general rule at section 7511(a)(1)(C)

that excepted service employees with two years of contin-

uous service have appeal rights and the specific exception

to this rule at section 241(a) which permits an agency to

deny the appeal rights to a narrow category of personnel.”

Todd, 55 F.3d at 1578.

In Briggs, we reviewed 29 U.S.C. § 783(a)(1), which

states that the National Council on Disability (Council)

“may appoint, without regard to the provisions of Title 5

governing appointments in the competitive service, or the

provisions of chapter 51 and subchapter III of chapter 53

LAL v. MSPB 9

of such title relating to classification and General Sched-

ule pay rates, an Executive Director . . . .” Because “Con-

gress gave the Council the option of disregarding only

certain parts of title 5,” which did not include removal

protections or the definition of employee in § 7511, we

held that § 783(a)(1) did not exempt the Executive Direc-

tor from the broad reach of 5 U.S.C. § 7511(a)(1)(C).

Briggs, 83 F.3d at 1388. Therefore, personnel hired

pursuant to § 783(a)(1) are hired into the excepted service

and fall within the gamut of the Due Process Amend-

ments and § 7511(a)(1)(C).

More recently, in Bennett, we found that a statute

that explicitly gives the authority to “appoint[ ] . . . and

remove[ ] . . . without regard to the provisions of title 5

governing appointments in the competitive service” was

sufficient to exempt the position from the reach of the Due

Process Amendments. 635 F.3d at 1219–20.

Here, unlike the statutes at issue in Bennett and

Todd, 42 U.S.C. § 209(f) merely states “appoint without

regard to the civil-service laws” and does not include an

explicit reference to removal or § 7511. As a result, we

decline to find an additional implicit exemption to

§ 7511(a)’s definition of “employee” for special consultants

like Ms. Lal.

Moreover, we find no conflict between § 209(f)’s au-

thority to hire employees into the excepted service and the

Due Process Amendments’ extension of appeal rights to

non-preference eligible members of the excepted service.

Cf. Todd, 55 F.3d at 1577–78 (finding “no irreconcilability

or repugnancy between the general rule at section

7511(a)(1)(C) that excepted service employees with two

years of continuous service have appeal rights and the

specific exception to this rule at section 241(a) which

permits an agency to deny the appeal rights to a narrow

category of personnel”). Rather, § 7511(a)(1)(C) operates

in this situation as it was intended: it extends adminis-

10 LAL v. MSPB

trative and judicial appeal rights to non-preference eligi-

ble members of the excepted service. To the extent the

OPM’s implementing regulation at 5 C.F.R.

§ 752.401(d)(12) calls for a result contrary to the plain

meaning of 5 U.S.C. § 7511 and 42 U.S.C. § 209(f), “it has

no force or effect in this case,” Briggs, 83 F.3d at 1388.

In sum, we find that Ms. Lal was hired into the ex-

cepted service pursuant to § 209(f) and, because § 209(f)

does not explicitly exempt personnel from the definition of

“employee” in § 7511 or include specific reference to

removal authority, the Due Process Amendments extend-

ed jurisdiction over Ms. Lal’s claims. Accordingly, we

reverse the Board’s dismissal for lack of jurisdiction and

remand for further proceedings.

REVERSED AND REMANDED