Comments from the Office of Personnel Management in a recent rulemaking could change how agencies approach performance improvement plans and termination for cause.
The Office of Personnel Management writes in new regulations proposed on Tuesday that a precedent-altering 2021 court ruling is in opposition to OPM’s interpretation of statute -- a move that could help agencies in future lawsuits around firings for poor performance.
The new regulations on performance and firing were promulgated to reverse changes made by the Trump administration on how feds can be disciplined, and to implement President Biden's executive order reversing his predecessor’s workforce policies.
A major revision is bringing back the ability of agencies to remove or change official personnel records as part of settlement agreements. OPM also reversed Trump regulations that capped improvement periods at 30 days and required agencies to remind supervisors at certain intervals when their employees' probationary period was ending.
OPM also took the opportunity to comment on Santos v NASA, a key personnel case decided last March in the U.S. Court of Appeals for the Federal Circuit that changed decades-old precedent on what agencies need to prove in lawsuits around performance-based removals.
The court ruled that agencies must be able to show that a federal employee had poor performance warranting their placement on a performance improvement plan (PIP), a formal opportunity for an employee to address poor performance, before they were fired.
The court decision referenced OPM comments from the Trump-era regulations that are now being amended. But in the new regulations, OPM writes that the Santos decision goes against OPM’s interpretation of statute.
“OPM wishes to clarify that the conclusion in Santos is contrary to OPM’s comment in supplemental information on which Santos relies and OPM’s interpretation of” Title 5, the regulation reads.
In the Santos ruling, the judge referenced OPM’s 2020 regulations, which stated that agencies weren’t relieved “of the responsibility to demonstrate that an employee was performing unacceptably -- which per statute covers the period both prior to and during a formal opportunity period -- before initiating an adverse action.”
In the new regulations, OPM writes that it interprets the statute to mean agencies cannot take performance-based adverse actions unless they first give a federal employee notice and an opportunity to improve.
This reading of statute allows agencies to use PIPs to address performance issues “without concern that employees who ultimately are unable to demonstrate acceptable performance … cannot be removed because the [Merit Systems Protection Board] or a court might find that they were not performing unacceptably when the PIP began,” the new regulation reads.
OPM’s new comments don’t change the standard set in Santos, said Jim Eisenmann, a partner at Alden Law Group, who previously served as executive director and general counsel of the MSPB.
OPM seems to be trying to “set the record straight” on its position, he said.
What the latest commentary could do, he said, is reappear in future court cases as agencies defend employee terminations. It would take either legislation or additional court action reversing the Santos decision to change the standard, Eisenmann said.