OPM Reduction-in-Force Appeals Transfer Is Lawful and Necessary

Most private-sector employees serve “at will,” meaning they can’t challenge their terminations except on narrow grounds such as discrimination based on race or sex. Federal employees, by contrast, typically can appeal their employing agency’s decision to terminate or demote them on a wide variety of grounds.

These appeals are possible because of what one court described as an “enormously complicated and subtle” review scheme in the Civil Service Reform Act of 1978. In the CSRA, Congress considered a wide variety of possible employment actions and spelled out different administrative and judicial procedures by which employees could challenge each one.

Congress was specific for a reason. It sought to replace an outdated patchwork review scheme with a streamlined and rational system that balanced the interests of employees and agencies—and avoided wasteful, duplicative lawsuits in court and administrative agencies.

As part of the CSRA, Congress carefully defined the appellate jurisdiction of the Merit Systems Protection Board, which hears various types of federal employee appeals. As the US Supreme Court noted in Elgin v. Department of the Treasury, the merit board’s jurisdiction “turns on the type of civil service employee and adverse employment action at issue.”

Some employment actions are specifically excluded from the merit board’s jurisdiction. For example, Congress specifically excluded “a reduction-in-force action” from the categories of actions over which the merit board has jurisdiction. A reduction in force, or RIF, is a separation, demotion, or other employment action that results from a restructuring or layoff, as opposed to a termination for other reasons such as poor performance or misconduct.

Under the text of the CSRA, there is no requirement that there be any employee appeals regarding RIFs—much less that the merit board decide these appeals.

Over the years, however, the Office of Personnel Management has decided, via regulation, that RIF appeals should be decided by the merit board—despite Congress having expressly carved them out from the merit board’s jurisdiction in the CSRA.

OPM proposed regulations in February to replace the current complex and protracted merit board appeal process that currently governs RIF appeals with a single, streamlined appeal at OPM.

This proposal to shift RIF appeals from the merit board to OPM can’t be struck down under the Supreme Court’s Learning Resources v. Trump decision. These types of appeals were never assigned as one of the merit board’s core functions. In fact, Congress said just the opposite in the CSRA.

Challenges to RIFs were one of the categories of actions Congress expressly excluded from the merit board’s jurisdiction. The legislative history confirms that Congress intended for “appeals arising out of reduction in force actions” to continue to be governed by a statute under which the OPM’s predecessor agency, the Civil Service Commission, heard such appeals.

Congress never intended the merit board to house all adjudications by federal employees, while the OPM only engages in rulemaking. For many years, the OPM has adjudicated appeals over classification, wage-and-hour matters, certain compensation and leave claims, and declination of reasonable offer decisions.

More recently, Congress assigned the OPM authority to adjudicate appeals from current and former employees of the Department of Veterans Affairs for recoupment of awards and bonuses. The Equal Employment Opportunity Commission, for its part, adjudicates federal employee appeals regarding various discrimination claims.

Meanwhile, the merit board has rulemaking power of its own given to it by Congress. Congress didn’t enact a rigid “separation of powers” between the merit board and OPM but gave both agencies responsibility for ensuring a merit-based civil service.

Transferring RIF appeals to the OPM wouldn’t override due process. The OPM’s proposed rule carefully preserves due process, requires hearings where there are disputed facts, provides for the OPM to investigate or audit a RIF, allows for the employee to review the results of the audit or investigation, requires OPM to issue a written decision, and gives the OPM broad power to order appropriate relief.

What would change is that employees would no longer have to navigate the convoluted merit board process, which features two rounds of proceedings (first before an administrative judge, then before the merit board itself), before potentially proceeding to yet another appeal, in court.

This protracted process can take years and wastes untold amounts of taxpayer money. It isn’t fair to employees who seek quick redress for mistakes, errors, or legal violations in the RIF process, and it isn’t fair to taxpayers who foot the bill for this unnecessarily lengthy process.

It’s not just Congress that can change the current OPM regulations authorizing RIF appeals. The OPM can change regulations that it issued, and Congress clearly excluded RIF appeals from the merit board’s statutory jurisdiction.

It’s highly unlikely that any of the Supreme Court justices would vote to strike down the OPM’s proposed regulation under the major questions doctrine. An executive branch agency adjudicating RIF appeals brought by its own employees is nothing like the sort of regulation that imposes substantial and unanticipated costs on regulated parties that the Supreme Court in 2022 found in West Virginia v. EPA to trigger application of the major questions doctrine. And RIF appeals historically have made up a very small proportion of the merit board’s caseload.

For its part, the Supreme Court repeatedly has noted the “elaborate” and “comprehensive” nature of the CSRA scheme that Congress created. Chief Justice John Roberts, while serving on the US Court of Appeals for the DC Circuit in 2005, recognized in Fornaro v. James “the exclusivity of the remedial and review provisions of the CSRA,” and that “what you get under the CSRA is what you get.”

Ultimately, Congress in the CSRA specifically excluded RIF appeals from the merit board’s jurisdiction and left the determination regarding such appeals to the OPM. Congress therefore gave the OPM the discretion to craft a better RIF appeal process—and that is exactly what the OPM is seeking to do with its proposed RIF appeals rule.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

Noah Peters is a senior adviser at the US Office of Personnel Management.

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