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March 12, 2020

OPM Proposes Revisions to Back Pay Act Regulations

The Office of Personnel Management (OPM) has proposed changes to its longstanding regulations interpreting the scope of the Back Pay Act.
Home » News » OPM Proposes Revisions to Back Pay Act Regulations

Thu, 12/03/2020

The Office of Personnel Management (OPM) has proposed changes to its longstanding regulations interpreting the scope of the Back Pay Act. Although these changes may appear minor at first glance, their implementation would cause significant harm to federal employees. The changes will greatly limit the scope of the Back Pay Act, effectively preventing federal employees from challenging many pay violations.

The Back Pay Act establishes a uniform system for making federal employees whole where the government unlawfully deprives them of pay through an “unjustified or unwarranted personnel action.” 5 U.S.C. § 5596(b)(1). The Act defines “personnel action” to include “the omission or failure to take an action or confer a benefit.” § 5596(b)(5). Aggrieved federal employees who bring successful claims under the Back Pay Act are entitled to back pay, attorney’s fees, and full credit for missed time. § 5596(b)(1)(A).

OPM has proposed two key changes to its regulations:

First, it attempts to limit the scope of the Back Pay Act to exclude “pay actions” under the definition of “unjustified or unwarranted personnel action.” See 5 C.F.R. § 550.803 (providing definitions for Back Pay Act).
Second, it seeks to exclude labor organizations from the definition of “employee’s personal representative,” thereby precluding them from recovering attorney’s fees under the Back Pay Act. Id.
Neither change is warranted based on the text and purposes of the Back Pay Act and both changes will hurt federal employees and prevent them from seeking make whole relief.

First, eliminating “pay actions” from the definition of “personnel action” would effectively eliminate the ability for employees to recoup unlawfully withheld statutory pay and benefits unrelated to formal “personnel actions.” While pay disputes arising from, for example, an appointment, removal or suspension, a promotion or demotion, or a change in step or grade, would still be included under the definition, pay disputes in many other contexts would be excluded. Employees would not be able to recover under the Back Pay Act for such “pay actions” as failing to properly pay night differential payments, holiday pay, hazardous duty pay, Sunday pay, or Title 5 overtime, or even correcting simple clerical errors like a missing paycheck. This means that, even if a federal employee could otherwise challenge these pay violations under another law, the employee would no longer be able to seek reasonable attorneys’ fees and expenses under the Back Pay Act as part of the challenge. Without the ability to seek attorneys’ fees and expenses, most federal employees will be effectively unable to shoulder the cost of challenging these wage violations and the Federal Government could be able to violate its own pay laws with impunity.

By attempting to eliminate pay actions, OPM is depriving employees of their rights under the Back Pay Act to be made whole when the government fails to pay them correctly. Importantly, the Back Pay Act’s scope is already limited to only payments required by law. It is only if the government fails to confer a mandatory payment or benefit conferred by statute will the Act appropriately provide relief to an employee. See, e.g., In re Levenson, 587 F.3d 925, 936 (9th Cir. 2009) (finding spousal health insurance to be a mandatory personnel policy and concluding that the “denial of federal benefits to [plaintiff’s] spouse constitutes an ‘unjustified or unwarranted personnel action’ under the Back Pay Act”). Thus, there is simply no need to further limit the definition unless the goal is to make it easier for the government to take federal employees’ money with impunity.

Second, OPM proposes limiting the definition of an “employee’s personal representative” in its regulations to mean exclusively the executor or administrator of the estate of a deceased employee, and to exclude “labor organizations.” OPM provides no explanation for this change other than to say that OPM now intends to exclude “labor organizations.”

OPM’s proposed rule attempts to financially undermine the ability for labor organizations to represent bargaining unit employees and betrays the purposes of the Back Pay Act and other federal service employment statutes. Attorneys’ fees under the Back Pay Act are part of the relief necessary to make employees whole. In addition, unions and their lawyers are required by law to be the exclusive bargaining representatives of federal employees. Depriving unions of their ability to recover attorneys’ fees would unnecessarily conflict with this role. As one court observed, “[a]fter imposing upon unions and their lawyers the responsibility of employee representation in areas vital in the scheme of the Civil Service Reform Act, it would have been the height of irony for Congress to deny them the blessing of [attorneys’ fees under] the Back Pay Act.” AFGE, Local 3882 v. Fed. Labor Relations Auth., 944 F.2d 922, 932 (D.C. Cir. 1991).

Because the two changes proposed by OPM are contrary to the Back Pay Act’s purpose and intended solely to hurt federal employees, we have submitted comments to OPM opposing these proposed changes.

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