On March 3, the Department of Homeland Security (DHS) announced its new personnel regulations, 5 CFR §9701, et seq., to take effect no later than August 1, 2005. These regulations drastically reduce approximately 110,000 employees’ rights to appeal adverse conduct- or performance-based actions, to engage in labor-management collective bargaining and to be assured of consistent pay increases. The new DHS regulations have the potential to reach far beyond DHS, because the administration hopes to expand personnel reforms like those at DHS to many, if not all, other federal agencies. The Department of Defense’s (DoD’s) approximately 750,000 civilian employees are likely to see similar changes within a year.
The new regulations stemmed from the Homeland Security Act of 2002 (November 25, 2002), PL 107-296, which created DHS effective March 1, 2003, combining 20 existing federal agencies and functions. This Act gave the DHS Secretary and the Director of the Office of Personnel Management (OPM) the authority to establish a “contemporary” and “flexible” new human resources management system for DHS (5 USC §§9701(b)(1) and (2)), abandoning most of the existing requirements of Title 5 of the United States Code. See Federal Legal Corner 3/3/04.
After February 20, 2004, when DHS and OPM issued the proposed personnel policies for DHS, the major federal employees’ unions (including the American Federation of Government Employees (AFGE), AFL-CIO, and the National Treasury Employees Union (NTEU)), directly representing more than one-quarter of DHS employees, submitted a 91-page joint commentary. The unions objected to the DHS system “in its entirety and strongly recommend[ed] that it not be implemented until the many serious defects . . . have been corrected.”
Due to their input, and that of influential legislators (see Federal Legal Corner, 6/16/04), the regulations finally issued on March 3, 2005 did contain variations from the original proposed regulations – for example, providing greater detail on the new mandatory removal offenses (MROs), giving some arbitration opportunities to employees with non-MROs, eliminating the notion of “performance review boards,” and maintaining the status quo burden of proof for an agency in a non-MRO misconduct action, i.e., that to sustain an action against a non-probationary employee, an agency must prove by a preponderance of the evidence (greater than 50 percent) that an employee engaged in misconduct. However, most of the originally-proposed DHS changes were adopted in the final regulations, including, for example: 1) eliminating the general schedule, and substituting a new “pay-banding” system which gives management more discretion to grant or prevent pay increases; 2) curtailing union rights across the board and establishing a Homeland Security Labor Relations Board (HSLRB); and 3) drastically reducing the scope and changing the nature of possible employee appeals of performance- and conduct-based adverse actions.
As to employee appeals, the new DHS system features a curtailed MSPB adjudication process, the end of “the Douglas factors” and their opportunity for penalty mitigation, restricted vehicles for settlement of disputes, and the creation of new mandatory removal offenses and a new mandatory removal bureaucracy. The new standards set forth under the DHS regulations will be defined by the MSPB and the courts in the coming year, as extensive litigation is likely. The federal employee unions have already filed a lawsuit to stop the new DHS personnel regulations from taking effect.
* This information is provided by the attorneys at
Passman & Kaplan, P.C., a law firm dedicated to
the representation of federal employees worldwide.
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