A federal court has backed agency management on a major principle underlying the 2013 sequestration furloughs, in a case involving Navy employees whose salaries were paid out of fees their facility charged to clients.
The case was one of the appeals filed in the wake of the sequester furloughs—which affected employees of a number of agencies, generally requiring them to take off up to about a week unpaid—involving employees paid not paid from regular appropriations—in this case so-called “working capital fund” operations.
The MSPB earlier rejected the appeal, holding that the furlough met the standard of promoting the efficiency of the service on grounds that it was a reasonable management solution to the financial restrictions placed on the agency—and further, that it was reasonable for management to consider the budget situation holistically, rather than to isolate each individual activity.
The U.S. Court of Appeals for the Federal Circuit has affirmed, holding that a decision to issue a furlough will promote the efficiency of the service if it is a reasonable management solution to the financial restrictions placed on an agency, and if the agency determines which employees to furlough in a fair and even manner, according to an MSPB summary of the court’s ruling.
It said the decision further established that an agency is not required to show actual re-programming of the funds saved by the furlough to meet the efficiency of the service standard, and the Navy was not obligated to implement the DoD directive regarding sequestration in the same manner as other DoD subagencies.