Federal Whistleblower Must Specifically Identify Disclosures to Exhaust Administrative Remedies Before OSC: Tenth Circuit

Practical Law Legal Update w-004-5772 (Approx. 4 pages)

Federal Whistleblower Must Specifically Identify Disclosures to Exhaust Administrative Remedies Before OSC: Tenth Circuit

by Practical Law Labor & Employment

Background

Acha, a purchasing agent for the Forest Service (a Department of Agriculture (DOA) agency), was responsible for ensuring that all purchases complied with the Federal Acquisition Regulation (FAR). In January 2012, he reported to his supervisor what he believed to be an unauthorized deposit that violated FAR. In April, Acha emailed the DOA's Inspector General, describing the deposit violation, that his supervisor instructed him to cover up the violation, and that he was punished for following that instruction. The Inspector General took no action.

Acha's employment was terminated during his probationary period. He filed an OSC complaint, alleging that he was a whistleblower and that the termination was a result of his April disclosures to the Inspector General. OSC refused to seek corrective action from the MSPB on his behalf because no official involved with Acha's termination knew of Acha's April email. Acha appealed to the MSPB, arguing that he was fired for his April whistleblowing disclosures to the Inspector General and the January disclosure to his supervisor of the FAR violation.

When Acha filed his OSC complaint, disclosures made during an employee's normal course of duties (like his January disclosure) were not protected activity under the Whistleblower Protection Act (WPA). While his MSPB appeal was pending, Congress passed the Whistleblower Protection Enhancement Act of 2012 (WPEA), which now protects employee disclosures made during the normal course of duties, and applies retroactively to pending appeals.

Acha also argued that he had exhausted his remedies because although he did not specifically allege in his OSC complaint that he was terminated for the January disclosure, he had included information about the January disclosure in his complaint. He attached to the OSC complaint his April email to the Inspector General, in which he discussed the January disclosure and that he was punished for disclosing the FAR violation. He argued his complaint gave OSC "sufficient basis to pursue an investigation" (Serrao v. Merit Sys. Protection, Bd., 95 F.3d 1569, 1577 (Fed. Cir. 1996)).

The MSPB concluded that Acha exhausted his administrative remedies but dismissed his appeal on the merits.

Outcome

The Tenth Circuit:

Vacated the MSPB's decision and remanded the case back to the MSPB to dismiss the appeal for lack of jurisdiction.
Compared Acha to the recent McCarthy v. Merit Sys. Protection Bd. decision in which the Federal Circuit held that:
- another employee had failed to exhaust his administrative remedies on aspects of his complaint that were not cognizable before the WPEA was passed; and
- that he could also refile his OSC complaint.
(809 F.3d 1365, 1374 (Fed. Cir. 2016); see Legal Update, Federal Employee Has Second Bite at Whistleblowing Reprisal Claim, Thanks to WPEA.)
Found that:
- OSC's awareness of Acha's January disclosure did not automatically make OSC aware that it should have investigated whether he was terminated for making this disclosure;
- Acha's failure to specifically allege that he was terminated for the January disclosure was fatal to the MSPB's jurisdiction; and
- once the WPEA passed, allowing corrective action for employee disclosures during the normal course of duties, OSC was entitled to determine whether it wanted to pursue corrective action for Acha's January disclosure. Acha was required to present his claim concerning the January disclosure to the OSC before presenting it to the MSPB.

However, the facts in McCarthy were different than the facts in Acha. McCarthy's OSC complaint made no mention of any disclosures he made during the course of his duties. Acha, on the other hand, included a description of his January disclosure in an attachment to the complaint; he just did not specifically allege that the January disclosure was the cause of his termination. OSC filed an amicus brief in Acha, in which it:

Argued that the MSPB misapplied Acha's burden to prove when a disclosure made in the normal course of duties is a protected disclosure under the WPEA.
Did not support the agency's position that Acha failed to exhaust his administrative remedies.

Practical Implications

No statute of limitations exists for federal employees to file whistleblower complaints under the WPA or WPEA, so Acha has the opportunity to refile his complaint before OSC and clarify his allegations. The Tenth Circuit has jurisdiction over federal employee whistleblower appeals for a five year trial period that ends in late 2017 and therefore has little case law regarding MSPB decisions. Had the Federal Circuit (which has near-exclusive jurisdiction over MSPB decisions except for this trial period) heard Acha, it might have ruled differently than the Tenth Circuit did here. The Federal Circuit has held that:

Employees need only to give OSC "sufficient basis to pursue an investigation."
An employee need not correctly affix legal labels to his facts.

Unless renewed or extended, the Tenth Circuit's jurisdiction (and the jurisdiction of all circuits other than the Federal Circuit) to hear MSPB appeals under the WPEA will expire next year. As a result, the Tenth Circuit may not have the opportunity to review future whistleblower MSPB decisions. Nevertheless, a federal employee should specifically identify all disclosures in his OSC complaint to ensure that he is properly exhausting all administrative remedies.

Federal Whistleblower Must Specifically Identify Disclosures to Exhaust Administrative Remedies Before OSC: Tenth Circuit | Practical Law