B-180021(B),L/M, MAR 20, 1975

B-180021(B),L/M: Mar 20, 1975

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HOUSE OF REPRESENTATIVES: REFERENCE IS MADE TO YOUR LETTERS OF JULY 17. REQUESTING OUR OFFICE TO PROVIDE AN ASSESSMENT OF EXISTING LAW AND REGULATIONS GOVERNING "MAKE-WHOLE" REMEDIES FOR FEDERAL EMPLOYEES WHO HAVE UNDERGONE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTIONS TO CORRECT SUCH IMPROPER PERSONNEL ACTIONS. YOU ALSO ASK US TO IDENTIFY ANY GAPS IN EXISTING COVERAGE WHICH WE BELIEVE WILL REQUIRE NEW LEGISLATION. YOU HAVE ASKED US TO ANALYSE ARBITRATION AWARDS MADE TO DATE UNDER EXECUTIVE ORDER NO. 11491. WILL BE HELPFUL TO YOUR COMMITTEE IN CONSIDERING POSSIBLE CHANGES IN THE PERMISSIBLE SCOPE OF ARBITRATION. A STUDY OF THE APPROXIMATELY 600 ARBITRATION AWARDS INVOLVED IS ACTIVELY UNDERWAY.

B-180021(B),L/M, MAR 20, 1975

PRECIS-UNAVAILABLE

DAVID N. HENDERSON, HOUSE OF REPRESENTATIVES:

REFERENCE IS MADE TO YOUR LETTERS OF JULY 17, 1974, AND DECEMBER 13, 1974, REQUESTING OUR OFFICE TO PROVIDE AN ASSESSMENT OF EXISTING LAW AND REGULATIONS GOVERNING "MAKE-WHOLE" REMEDIES FOR FEDERAL EMPLOYEES WHO HAVE UNDERGONE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTIONS TO CORRECT SUCH IMPROPER PERSONNEL ACTIONS. YOU ALSO ASK US TO IDENTIFY ANY GAPS IN EXISTING COVERAGE WHICH WE BELIEVE WILL REQUIRE NEW LEGISLATION.

IN ADDITION, YOU HAVE ASKED US TO ANALYSE ARBITRATION AWARDS MADE TO DATE UNDER EXECUTIVE ORDER NO. 11491, AND ITS PREDECESSOR EXECUTIVE ORDER NO. 10988, WHICH, WE UNDERSTAND FROM MEMBERS OF YOUR STAFF, WILL BE HELPFUL TO YOUR COMMITTEE IN CONSIDERING POSSIBLE CHANGES IN THE PERMISSIBLE SCOPE OF ARBITRATION.

WITH RESPECT TO THIS LAST REQUEST, A STUDY OF THE APPROXIMATELY 600 ARBITRATION AWARDS INVOLVED IS ACTIVELY UNDERWAY. AS YOU SUGGEST, WE WILL FORWARD A REPORT ON THIS STUDY SEPARATELY WHEN IT IS COMPLETED.

THE SINGLE MOST COMPREHENSIVE STATUTORY REMEDY FOR FEDERAL EMPLOYEES WHO HAVE BEEN WRONGFULLY DEPRIVED OF PAY, ALLOWANCES, OR DIFFERENTIALS IS THE BACK PAY ACT OF 1966, 5 U.S.C. SEC. 5596 (1970), WHICH THE CIVIL SERVICE COMMISSION (CSC) ADMINISTERS. FOR MANY YEARS THE ACT HAS BEEN INTERPRETED RATHER NARROWLY BY OUR OFFICE, AS REFLECTED IN CSC REGULATIONS (5 C.F.R. PART 550, SUBPART H), WHICH, AS YOUR STAFF MEMBERS POINTED OUT TO US, HAS GENERATED A NUMBER OF PROPOSALS TO PROVIDE NEW MAKE-WHOLE REMEDIES THROUGH LEGISLATION. IN THE LAST 6 MONTHS, WE HAVE BEEN REEXAMINING OUR OLD POSITIONS AND HAVE ISSUED A NUMBER OF DECISIONS WHICH HAVE CONSIDERABLY BROADENED THE APPLICABILITY OF THE ACT. (COPIES OF THESE DECISIONS HAVE PREVIOUSLY BEEN FURNISHED TO YOUR STAFF.) AMONG THE MAJOR CHANGES IN APPROACH IS THE ADOPTION OF THE PRINCIPLE THAT ANY FAILURE TO CARRY OUT A MANDATORY PERSONNEL REQUIREMENT - WHETHER THE REQUIREMENT IS FOUND IN A LAW, AN AGENCY REGULATION, AN EXECUTIVE ORDER, OR A VALID COLLECTIVE BARGAINING AGREEMENT - IS AN UNWARRANTED OR UNJUSTIFIED PERSONNEL ACTION WHICH MAY BE CORRECTED UNDER THE BACK PAY ACT, SUPRA, IF THE NECESSARY CAUSAL CONNECTION BETWEEN THE ACT AND THE INJURY TO THE EMPLOYEE IS ESTABLISHED. WE NO LONGER REQUIRE THAT THE WRONGFUL ACT BE AFFIRMATIVE RATHER THAN A FAILURE TO ACT, OR THAT THE INJURY TO THE EMPLOYEE INVOLVE A "WITHDRAWAL" OF A BENEFIT RATHER THAN A FAILURE TO CONFER THE BENEFIT AT ALL. OF MOST IMPORTANCE IS THE FACT THAT WE NOW REGARD A BINDING ARBITRATION AWARD ON THE SAME BASIS AS IF THE AWARD HAD BEEN MADE BY THE AGENCY HEAD, FOR THE PURPOSE OF APPLYING THE REMEDIES AVAILABLE UNDER THE BACK PAY ACT. SEE TAB A FOR A MORE DETAILED DISCUSSION OF THE SCOPE OF THE REMEDIES WE FEEL ARE AVAILABLE UNDER THE ACT.

THESE POLICIES HAVE BEEN FORMULATED IN CLOSE COOPERATION WITH THE CSC WHICH IS IN COMPLETE AGREEMENT WITH THIS NEW APPROACH. THE CSC HAS RECENTLY CIRCULATED FOR COMMENT NEW DRAFT REGULATIONS WHICH INCORPORATE THESE PRINCIPLES TO EXECUTIVE AGENCIES, EMPLOYEE ORGANIZATIONS, AND OTHER CONCERNED PARTIES. (WE UNDERSTAND YOU HAVE OR WILL SOON BE SENT A COPY OF THE PROPOSED REGULATIONS BY THE CSC AS WELL.) A DISCUSSION OF SOME OF THE MAJOR PROPOSED CHANGES IN THE REGULATIONS IS ALSO INCLUDED IN TAB A.

WITH REGARD TO OTHER MAKE-WHOLE REMEDIES, IN ADDITION TO THE BACK PAY STATUTE, WE NOTE THAT HEALTH INSURANCE MAY BE REINSTATED UNDER THE PROVISIONS OF 5 U.S.C. SEC. 8908 (SEE TAB B.1), AND LIFE INSURANCE MAY BE RESTORED UNDER 5 U.S.C. SEC. 8706(F). (SEE TAB B.2.) DISCRIMINATION IN GOVERNMENT EMPLOYMENT ON GROUNDS OF RACE, COLOR, RELIGION, SEX, OR NATIONAL ORIGIN MAY BE CORRECTED UNDER PROVISIONS OF 42 U.S.C. SEC. 2000E - 16(B). (SEE TAB B.3.) SIMILARLY, THE ASSISTANT SECRETARY OF LABOR FOR LABOR-MANAGEMENT RELATIONS (A/SLMR), UNDER SECTIONS 6(A)(4) AND 6(B) OF EXECUTIVE ORDER NO. 11491, AS AMENDED, IS AUTHORIZED TO HEAR UNFAIR LABOR PRACTICE COMPLAINTS AND TO REQUIRE THAT AGENCIES AND LABOR ORGANIZATIONS TAKE SUCH AFFIRMATIVE ACTION AS HE CONSIDERS APPROPRIATE WHEN UNFAIR LABOR PRACTICES ARE FOUND TO HAVE OCCURRED. THIS AUTHORITY ENABLES THE A/SLMR TO ORDER AGENCIES TO TAKE CORRECTIVE ACTION CONSISTENT WITH LAW AND REGULATIONS WHEN HE DETERMINES THAT AN EMPLOYEE HAS BEEN DISCRIMINATED AGAINST BECAUSE OF HIS UNION ACTIVITY. ALL THE MAKE-WHOLE REMEDIES DISCUSSED, SUPRA, ARE AVAILABLE FOR THE PURPOSE OF CORRECTING IMPROPER PERSONNEL ACTIONS IN UNFAIR LABOR PRACTICE CASES TOO. (SEE TAB B.4.)

WAIVER OF CLAIMS AGAINST EMPLOYEES FOR OVERPAYMENTS OF PAY AND ALLOWANCES, INCLUDING EXCESS LEAVE CREDITED THROUGH ADMINISTRATIVE ERROR, IS PERMITTED UNDER 5 U.S.C. SEC. 5584, AS IMPLEMENTED BY REGULATIONS PROMULGATED BY THE GAO AT 4 C.F.R. SEC. 91, WHERE COLLECTION WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE. (SEE TAB B.5.)

PUBLIC LAW 93-181, DECEMBER 14, 1973, 5 U.S.C. SEC. 6304(D) (SUPP. III, 1973), PERMITS RESTORATION OF LEAVE TO AN EMPLOYEE THAT IS LOST THROUGH NO FAULT OF HIS UNDER CERTAIN SPECIFIED CIRCUMSTANCES. (SEE TAB B.6 FOR DISCUSSION OF THIS REMEDY.)

FINALLY, THE SECRETARY OF STATE HAS AUTHORITY UNDER PROVISIONS OF 22 U.S.C. SEC. 993 (SUPP. III, 1973), TO CORRECT CERTAIN ERRONEOUS PERSONNEL ACTIONS THAT AFFECT FOREIGN SERVICE EMPLOYEES BY IMPLEMENTING RECOMMENDATIONS OF GRIEVANCE BOARDS, PANELS, OR EQUAL OPPORTUNITY APPEALS EXAMINERS AND BY AWARDING RETROACTIVE PROMOTIONS AND ADDITIONAL INCREASES IN SALARY. SEE TAB B.7 FOR A DISCUSSION OF THIS AUTHORITY.

WE BELIEVE THAT THE PRESENT BACK PAY ACT WITH ITS IMPLEMENTING REGULATIONS, EITHER EXISTING OR PROPOSED, AND THE OTHER STATUTORY REMEDIES CITED ARE ADEQUATE IN MOST INSTANCES TO MAKE EMPLOYEES WHOLE. HOWEVER, THERE ARE SOME GAPS IN COVERAGE, FOR WHICH, IF SUCH COVERAGE IS DEEMED BY THE CONGRESS TO BE DESIRABLE, NEW LEGISLATION WOULD BE NECESSARY.

REMEDIES NOT CURRENTLY AUTHORIZED UNDER THE BACK PAY ACT INCLUDE PAYMENTS FOR ATTORNEY FEES AND LITIGATION EXPENSES OF THE EMPLOYEE IN OBTAINING HIS REMEDY (SEE TAB C.1), INTEREST ON THE AMOUNT OF THE MONETARY AWARD (SEE TAB C.2), AND CONSEQUENTIAL DAMAGES SUSTAINED BY THE EMPLOYEE DURING THE PERIOD THE IMPROPER PERSONNEL ACTION WAS IN EFFECT. (SEE TAB C.3.)

WE REFERRED EARLIER TO THE BENEFITS OF PUB. L. 93-181 WHICH PERMITS RESTORATION OF LEAVE TO EMPLOYEES WHICH WOULD NORMALLY BE FORFEITED UNDER CERTAIN PRESCRIBED CONDITIONS. THERE IS ONE INSTANCE IN WHICH WE FEEL THAT THE LEGISLATIVE REMEDY HAS BEEN UNNECESSARILY RESTRICTED BY CSC REGULATIONS. WHILE NORMALLY NO EMPLOYEE MAY BE CREDITED WITH ANNUAL LEAVE AT THE END OF THE LEAVE YEAR IN EXCESS OF THE CEILING PRESCRIBED BY LAW AND REGULATION, ANNUAL LEAVE WHICH HAD BEEN SCHEDULED IN ADVANCE BUT WAS NOT USED BECAUSE OF "ADMINISTRATIVE ERROR" MAY BE RESTORED AND PLACED IN A SEPARATE LEAVE ACCOUNT UNDER THE PROVISIONS OF THE NEW STATUTE. HOWEVER, IF THE EMPLOYEE IS REINSTATED PURSUANT TO THE BACK PAY ACT, HE MAY NOT BE ABLE TO TAKE ADVANTAGE OF PUB. L. 93 131 TO HAVE ALL HIS LEAVE RESTORED. CIVIL SERVICE COMMISSION IMPLEMENTING REGULATIONS, WHICH ARE CONTAINED IN THE ATTACHMENT TO FEDERAL PERSONNEL MANUAL (FPM) LETTER NO. 630-22, DATED JANUARY 11, 1974, HAVE CONSTRUED THE STATUTORY TERM "ADMINISTRATIVE ERROR" AS EXCLUDING "UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTIONS." TO CORRECT THIS SITUATION, WE ARE PRESENTLY EXPLORING WITH CSC THE POSSIBILITY OF AN AMENDMENT TO ITS CURRENT REGULATIONS. HOWEVER, IT MAY BE FELT THAT A LEGISLATIVE AMENDMENT TO 5 U.S.C. SEC. 6304(D)(1) WILL BE REQUIRED. SEE TAB C.4 FOR A FULLER DISCUSSION OF THIS PROBLEM.

UNDER TAB B.3, WE DISCUSS EXISTING REMEDIES FOR FAILURE TO AFFORD EQUAL EMPLOYMENT OPPORTUNITY TO PERSONS WHO MAY NOT YET BE FEDERAL EMPLOYEES WHERE THE FAILURE IS ATTRIBUTABLE TO DISCRIMINATION ON CERTAIN SPECIFIED GROUNDS. HOWEVER, THE PERSON WHO WAS NOT HIRED INITIALLY BY THE FEDERAL GOVERNMENT ON EQUALLY MERETRICIOUS GROUNDS BUT WHICH ARE NOT BASED ON HIS RACE, COLOR, RELIGION, SEX, OR NATIONAL ORIGIN IS NOT PROTECTED BY ANY EXISTING LEGISLATION. THIS GAP IS DISCUSSED UNDER TAB C.5.

FINALLY, WE DISCUSS THE LACK OF A REMEDY FOR AN EMPLOYEE WHO WAS WRONGFULLY REMOVED FROM SERVICE AND WHO PURCHASED COMMERCIAL HEALTH INSURANCE TO PROTECT HIMSELF DURING THE PERIOD OF HIS REMOVAL. UPON REINSTATEMENT UNDER THE BACK PAY ACT, NO PORTION OF THE COST OF THAT COMMERCIAL INSURANCE MAY BE REIMBURSED UNDER EXISTING LAW OR REGULATIONS. SEE TAB C.6.

THE DESIRABILITY OF LEGISLATION TO FILL THESE GAPS IS, OF COURSE, A MATTER FOR CONGRESSIONAL DETERMINATION. WE ARE NOT PREPARED TO MAKE A RECOMMENDATION AT THE PRESENT TIME FOR OR AGAINST ENACTMENT OF SUCH LEGISLATION. THE DISCUSSION IN TAB C IS MERELY AN ATTEMPT TO IDENTIFY THE GAPS IN RESPONSE TO YOUR COMMITTEE'S REQUEST.

IN SUMMARY, WE CONCLUDE FROM OUR ANALYSIS THAT EXISTING STATUTORY MAKE- WHOLE REMEDIES ARE GENERALLY ADEQUATE TO RESTORE EMPLOYEES WHO HAVE UNDERGONE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTIONS TO THE SAME FINANCIAL POSITION THEY WOULD HAVE BEEN IN IF THE WRONGFUL ACTION HAD NOT TAKEN PLACE. THERE ARE A FEW SITUATIONS WHICH ARE NOT COVERED AND WHICH MAY REQUIRE LEGISLATIVE ACTION IF THE CONGRESS WISHES TO PROVIDE A REMEDY IN THESE CASES. WE HAVE IDENTIFIED THESE "GAPS" AND THE TYPE OF AMENDMENT THAT WOULD BE NECESSARY.

WE HOPE THE INFORMATION PROVIDED IS RESPONSIVE TO YOUR REQUEST, AND WE WILL BE GLAD TO PROVIDE WHATEVER ADDITIONAL ASSISTANCE YOU MAY REQUIRE.

BACK PAY STATUTE

THE BACK PAY ACT, 5 U.S.C. SEC. 5596 (1970), IS THE MAJOR STATUTORY AUTHORIZATION FOR PROVISION OF "MAKE-WHOLE" REMEDIES TO EMPLOYEES WHO HAVE UNDERGONE AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION. THE STATUTE PROVIDES:

"SEC. 5596. BACK PAY DUE TO UNJUSTIFIED PERSONNEL ACTION

"(A) FOR THE PURPOSE OF THIS SECTION, 'AGENCY' MEANS -

"(1) AN EXECUTIVE AGENCY;

"(2) THE ADMINISTRATIVE OFFICE OF THE UNITED STATES COURTS;

"(3) THE LIBRARY OF CONGRESS;

"(4) THE GOVERNMENT PRINTING OFFICE; AND

"(5) THE GOVERNMENT OF THE DISTRICT OF COLUMBIA.

"(B) AN EMPLOYEE OF AN AGENCY WHO, ON THE BASIS OF AN ADMINISTRATIVE DETERMINATION OR A TIMELY APPEAL, IS FOUND BY APPROPRIATE AUTHORITY UNDER APPLICABLE LAW OR REGULATION TO HAVE UNDERGONE AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION THAT HAS RESULTED IN THE WITHDRAWAL OR REDUCTION OF ALL OR A PART OF THE PAY, ALLOWANCES, OR DIFFERENTIALS OF THE EMPLOYEE -

"(1) IS ENTITLED, ON CORRECTION OF THE PERSONNEL ACTION, TO RECEIVE FOR THE PERIOD FOR WHICH THE PERSONNEL ACTION WAS IN EFFECT AN AMOUNT EQUAL TO ALL OR ANY PART OF THE PAY, ALLOWANCES, OR DIFFERENTIALS, AS APPLICABLE, THAT THE EMPLOYEE NORMALLY WOULD HAVE EARNED DURING THAT PERIOD IF THE PERSONNEL ACTION HAD NOT OCCURRED, LESS ANY AMOUNTS EARNED BY HIM THROUGH OTHER EMPLOYMENT DURING THAT PERIOD; AND

"(2) FOR ALL PURPOSES, IS DEEMED TO HAVE PERFORMED SERVICE FOR THE AGENCY DURING THAT PERIOD, EXCEPT THAT THE EMPLOYEE MAY NOT BE CREDITED, UNDER THIS SECTION, LEAVE IN AN AMOUNT THAT WOULD CAUSE THE AMOUNT OF LEAVE TO HIS CREDIT TO EXCEED THE MAXIMUM AMOUNT OF LEAVE AUTHORIZED FOR THE EMPLOYEE BY LAW OR REGULATION.

"(C) THE CIVIL SERVICE COMMISSION SHALL PRESCRIBE REGULATIONS TO CARRY OUT THIS SECTION. HOWEVER, THE REGULATIONS ARE NOT APPLICABLE TO THE TENNESSEE VALLEY AUTHORITY AND ITS EMPLOYEES."

THE CIVIL SERVICE COMMISSION HAS PROMULGATED IMPLEMENTING REGULATIONS FOR THIS STATUTE IN 5 C.F.R. CHAPTER 550, SUBPART H, WHICH PROVIDE AS FOLLOWS:

"SUBPART H - BACK PAY

"AUTHORITY: THE PROVISIONS OF THIS SUBPART H ISSUED UNDER 5 U.S.C. 5596.

"SEC. 550.801 SCOPE.

"(A) COVERAGE. THIS SUBPART APPLIES TO (1) AGENCIES AS DEFINED IN SEC. 550.802(A), AND (2) EMPLOYEES AS DEFINED IN SEC. 550.802(B).

"(B) APPLICABILITY. THIS SUBPART AND SECTION 5596 OF TITLE 5, U.S.C. APPLY TO THE COMPUTATION, PAYMENT, AND RESTORATION OF PAY, ALLOWANCES, DIFFERENTIALS, AND EMPLOYMENT BENEFITS FOR THE PURPOSE OF MAKING AN EMPLOYEE WHOLE WHEN THE EMPLOYEE, ON THE BASIS OF AN ADMINISTRATIVE DETERMINATION OR A TIMELY APPEAL, IS FOUND TO HAVE UNDERGONE AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION.

"SEC. 550.802 DEFINITIONS.

"IN THIS SUBPART:

"(A) 'AGENCY' MEANS (1) AN EXECUTIVE AGENCY (OTHER THAN THE TENNESSEE VALLEY AUTHORITY) AS DEFINED BY SECTION 105 OF TITLE 5, UNITED STATES CODE; (2) THE ADMINISTRATIVE OFFICE OF THE U.S. COURTS; (3) THE LIBRARY OF CONGRESS; (4) THE GOVERNMENT PRINTING OFFICE; AND (5) THE GOVERNMENT OF THE DISTRICT OF COLUMBIA.

"(B) 'EMPLOYEE' MEANS AN EMPLOYEE OF AN AGENCY, INCLUDING A FORMER EMPLOYEE.

"SEC. 550.803 DETERMINING ENTITLEMENT.

"(A) THE REQUIREMENT FOR AN ADMINISTRATIVE DETERMINATION REFERRED TO IN THE PHRASE 'ON THE BASIS OF AN ADMINISTRATIVE DETERMINATION OR A TIMELY APPEAL' IN SECTION 5596 OF TITLE 5, UNITED STATES CODE, IS MET WHEN AN APPROPRIATE AUTHORITY IN AN AGENCY MAKES A DECISION ON ITS OWN INITIATIVE IN A CASE INVOLVING AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION. THE DECISION MAY BE ORAL BUT SHALL BE CONFIRMED IN WRITING. "(B) THE REQUIREMENT FOR A TIMELY APPEAL REFERRED TO IN THE PHRASE 'ON THE BASIS OF AN ADMINISTRATIVE DETERMINATION OR A TIMELY APPEAL' IN SECTION 5596 OF TITLE 5, U.S.C. IS MET WHEN AN EMPLOYEE OR HIS AUTHORIZED REPRESENTATIVE INITIATES AN APPEAL UNDER AN APPEALS SYSTEM OR PROCEDURE ESTABLISHED BY LAW, EXECUTIVE ORDER, OR REGULATION AND THAT APPEAL IS ACCEPTED AS TIMELY FILED BY THE GOVERNMENT AUTHORITY ADMINISTERING THE APPEALS SYSTEM OR PROCEDURE CONCERNED.

"(C) THE APPROPRIATE AUTHORITY REFERRED TO IN SECTION 5596 OF TITLE 5, U.S.C. AND THIS SUBPART IS (1) THE AGENCY OR THE OFFICE OR OFFICIAL IN AN AGENCY AUTHORIZED UNDER APPLICABLE LAW OR REGULATION TO CORRECT, OR TO DIRECT THE CORRECTION OF, THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION, OR (2) A COURT HAVING JURISDICTION TO MAKE A DETERMINATION THAT A PERSONNEL ACTION IS UNJUSTIFIED OR UNWARRANTED.

"(D) TO BE UNJUSTIFIED OR UNWARRANTED A PERSONNEL ACTION MUST BE DETERMINED TO BE IMPROPER OR ERRONEOUS ON THE BASIS OF EITHER SUBSTANTIVE OR PROCEDURAL DEFECTS AFTER CONSIDERATION OF THE EQUITABLE LEGAL, AND PROCEDURAL ELEMENTS INVOLVED IN THE PERSONNEL ACTION.

"(E) A PERSONNEL ACTION REFERRED TO IN SECTION 5596 OF TITLE 5, U.S.C. AND THIS SUBPART IS ANY ACTION BY AN AUTHORIZED OFFICIAL OF AN AGENCY WHICH RESULTS IN THE WITHDRAWAL OR REDUCTION OF ALL OR ANY PART OF THE PAY ALLOWANCES, OR DIFFERENTIALS OF AN EMPLOYEE AND INCLUDES, BUT IS NOT LIMITED TO, SEPARATIONS FOR ANY REASON (INCLUDING RETIREMENT), SUSPENSIONS, FURLOUGHS WITHOUT PAY, DEMOTIONS, REDUCTIONS IN PAY, AND PERIODS OF ENFORCED PAID LEAVE WHETHER OR NOT CONNECTED WITH AN ADVERSE ACTION COVERED BY PART 752 OF THIS CHAPTER.

"SEC. 550.804 CORRECTIVE ACTION.

"(A) WHEN AN APPROPRIATE AUTHORITY CORRECTS AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION, THE AGENCY SHALL RECOMPUTE FOR THE PERIOD COVERED BY THE CORRECTIVE ACTION THE PAY, ALLOWANCES, DIFFERENTIALS, AND LEAVE ACCOUNT (LIMITING THE ACCUMULATION TO THE MAXIMUM PRESCRIBED BY LAW OR REGULATION FOR THE EMPLOYEE) OF THE EMPLOYEE AS IF THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION HAD NOT OCCURRED AND THE EMPLOYEE SHALL BE DEEMED FOR ALL PURPOSES TO HAVE RENDERED SERVICE IN THE AGENCY FOR THE PERIOD COVERED BY THE CORRECTIVE ACTION. IN MAKING ITS COMPUTATION UNDER THIS PARAGRAPH, AN AGENCY SHALL NOT INCLUDE AS ALLOWANCES ANY AMOUNT WHICH REPRESENTS REIMBURSEMENT FOR EXPENSES WHICH WOULD HAVE BEEN INCURRED BY AN EMPLOYEE IN THE PERFORMANCE OF HIS JOB IF THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION HAD NOT OCCURRED BUT WHICH WERE NOT INCURRED BECAUSE OF THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION BUT SHALL INCLUDE OTHER ALLOWANCES WHICH ARE A FORM OF REMUNERATION TO THE EMPLOYEE FOR SERVICES THAT OTHERWISE WOULD HAVE BEEN RENDERED IN THE JOB.

"(B) IN RECOMPUTING THE PAY, ALLOWANCES, DIFFERENTIALS, AND LEAVE ACCOUNT OF AN EMPLOYEE UNDER PARAGRAPH (A) OF THIS SECTION, THE AGENCY SHALL INCLUDE THE FOLLOWING:

"(1) PREMIUM PAY WHICH THE EMPLOYEE WOULD HAVE RECEIVED HAD IT NOT BEEN FOR THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION;

"(2) CHANGES IN PAY RATES BY REASON OF WAGE SURVEYS, ADMINISTRATIVE ACTION, LAW, OR OTHER CHANGES OF GENERAL APPLICATION;

"(3) CHANGES IN ALLOWANCE OR DIFFERENTIAL RATES;

"(4) WITHIN-GRADE OR STEP INCREASES OR OTHER PERIODIC INCREASES WHICH WOULD OTHERWISE HAVE BECOME DUE;

"(5) CHANGES IN PAY CAUSED BY CHANGES IN ASSIGNED WORKING-SHIFTS;

"(6) CHANGES IN THE EMPLOYEE'S LEAVE EARNING RATE; AND

"(7) ANY OTHER CHANGES WHICH WOULD AFFECT THE AMOUNT OF PAY, ALLOWANCES, DIFFERENTIALS OR LEAVE WHICH THE EMPLOYEE WOULD HAVE EARNED HAD IT NOT BEEN FOR THE UNJUSTIFIED OR UNWARRENTED PERSONNEL ACTION.

"(C) SUBJECT TO THE PROVISIONS OF PARAGRAPH (D) OF THIS SECTION, THE PERIOD FOR WHICH RECOMPUTATION IS REQUIRED UNDER PARAGRAPH (A) OF THIS SECTION IS THE PERIOD COVERED BY THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION WHICH IS CORRECTED AND MAY NOT EXTEND (1) BEYOND THE DATE OF THE EMPLOYEE'S DEATH, OR (2) BEYOND THE DATE ON WHICH THE EMPLOYEE WAS PROPERLY SEPARATED FROM THE ROLLS OF HIS AGENCY SUCH AS BY RESIGNATION, RETIREMENT, REMOVAL, REDUCTION IN FORCE, EXPIRATION OF APPOINTMENT, OR TRANSFER TO ANOTHER AGENCY, WHEN THE EMPLOYEE CONTINUED ON THE ROLLS OF THE AGENCY BEYOND THE DATE ON WHICH THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION WAS TAKEN AND THE SEPARATION WOULD HAVE BEEN EFFECTED EVEN THOUGH THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION HAD NOT BEEN TAKEN.

"(D) IN COMPUTING THE AMOUNT OF BACK PAY UNDER THIS SECTION AND SECTION 5596 OF TITLE 5, UNITED STATES CODE, THE AGENCY MAY NOT (1) INCLUDE ANY PERIOD DURING WHICH THE EMPLOYEE WAS NOT READY AND ABLE TO PERFORM HIS JOB BECAUSE OF INCAPACITATING ILLNESS, EXCEPT THAT THE AGENCY SHALL GRANT UPON THE REQUEST OF THE EMPLOYEE ANY SICK OR ANNUAL LEAVE TO HIS CREDIT TO COVER THE PERIOD OF INCAPACITY BY REASON OF ILLNESS, OR (2) INCLUDE ANY PERIOD DURING WHICH THE EMPLOYEE WAS UNAVAILABLE FOR THE PERFORMANCE OF HIS JOB AND HIS UNAVAILABILITY WAS NOT RELATED TO, OR CAUSED BY, THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION.

"(E) IN COMPUTING THE AMOUNT OF BACK PAY DUE AN EMPLOYEE UNDER THIS SECTION AND SECTION 5596 OF TITLE 5, U.S.C. THE AGENCY SHALL DEDUCT THE AMOUNTS EARNED BY THE EMPLOYEE FROM OTHER EMPLOYMENT DURING THE PERIOD COVERED BY THE CORRECTED PERSONNEL ACTION. THE AGENCY SHALL INCLUDE AS OTHER EMPLOYMENT ONLY THAT EMPLOYMENT ENGAGED IN BY THE EMPLOYEE TO TAKE THE PLACE OF THE EMPLOYMENT FROM WHICH THE EMPLOYEE WAS SEPARATED BY THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION.

"(F) IN COMPUTING THE AMOUNT OF BACK PAY DUE AN EMPLOYEE UNDER THIS SECTION AND SECTION 5596(B) OF TITLE 5, UNITED STATE CODE, IF THE EMPLOYEE HAS BEEN RESTORED WITHIN 1 YEAR AFTER HIS ERRONEOUS SEPARATION, THE AGENCY MAY NOT DELETE ANY PERIOD FROM COMPUTATION ON THE BASIS THAT THE EMPLOYEE WAS UNDER OBLIGATION TO MAKE AN EFFORT TO SECURE OTHER EMPLOYMENT DURING THE PERIOD COVERED BY THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION."

AS IS THE CASE WITH MANY STATUTORY REMEDIES, THE INTERPRETATION OF THE LEGISLATIVE LANGUAGE BY THOSE WHOM THE CONGRESS HAS DESIGNATED TO ADMINISTER OR TO APPLY THE PROVISIONS OF THE ACT TENDS TO BE DYNAMIC, CHANGING TO MEET NEW NEEDS OR NEW SITUATIONS NOT PREVIOUSLY ENCOUNTERED. AT THE PRESENT TIME, THE GENERAL ACCOUNTING OFFICE (GAO), IN THE EXERCISE OF ITS SETTLEMENT AUTHORITY (31 U.S.C. SEC. 71, ET SEQ.), AND THE CIVIL SERVICE COMMISSION (CSC), THE ADMINISTERING AGENCY, HAVE AGREED ON THE FOLLOWING INTERPRETATIONS OF THE TERMS OF THE ACT, ON WHICH WE BASE THE DECISIONS DESCRIBED BELOW:

1. "APPROPRIATE AUTHORITY" MAY MEAN AN AGENCY HEAD, THE DECISION MAKER DESIGNATED PURSUANT TO A STATUTORY APPEALS PROCEDURE (E.G., THE APPEALS REVIEW BOARD, CSC), AN ADMINISTRATIVE LAW JUDGE, AN ARBITRATOR APPOINTED THROUGH A COLLECTIVE BARGAINING AGREEMENT, OR THE COMPTROLLER GENERAL.

2. AN "UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION" MEANS ANY ACT OF COMMISSION OR OMISSION BY AN AUTHORIZED OFFICIAL OF AN AGENCY WHICH IS IN VIOLATION OF A NONDISCRETIONARY REQUIREMENT, WHETHER THAT REQUIREMENT IS FOUND IN A LAW, REGULATION, EXECUTIVE ORDER, AGENCY PERSONNEL POLICY MANUAL, OR NEGOTIATED COLLECTIVE BARGAINING AGREEMENT.

3. "RESULTED IN THE WITHDRAWAL, ETC.," MEANS THAT THE UNJUSTIFIED OR UNWARRANTED ACTION MUST HAVE DIRECTLY CAUSED THE HARM TO THE EMPLOYEE FOR WHICH HE SEEKS RESTITUTION. FOR EXAMPLE, A FAILURE TO CONSIDER AN EMPLOYEE FOR A PROMOTION, WHEN SEVERAL OTHER EQUALLY QUALIFIED CANDIDATES ARE UNDER CONSIDERATION AS WELL, IN VIOLATION OF A BINDING AGREEMENT IS AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION BUT NO BACK PAY IS WARRANTED SINCE IT CANNOT BE SAID THAT "BUT FOR" THE WRONGFUL ACTION, THE EMPLOYEE WOULD HAVE RECEIVED THE PROMOTION.

4. "WITHDRAWAL OR REDUCTION OF ALL OR A PART OF PAY, ETC.," INCLUDES FAILURE TO GIVE THE BENEFIT IN QUESTION IN THE FIRST PLACE.

5. THE TERM "PAY, ALLOWANCES, OR DIFFERENTIALS" INCLUDES, IN ADDITION TO THE USUAL SALARY AND PREMIUM PAY BENEFITS INCLUDED IN THE PRESENT REGULATIONS, A NUMBER OF MONETARY BENEFITS WHICH ARE THE USUAL PERQUISITES OF FEDERAL EMPLOYMENT. THUS, TRAVEL AND TRANSPORTATION COSTS, ANNUAL AND SICK LEAVE, AND HEALTH INSURANCE BENEFITS, FOR EXAMPLE, COULD BE INCLUDED IN A "MAKE-WHOLE" AWARD BUT BENEFITS NOT DIRECTLY ATTRIBUTABLE TO HIS STATUS AS A FEDERAL EMPLOYEE WOULD NOT - E.G., ACCESS TO PUBLIC TRANSPORTATION, MAKING A CAR UNNECESSARY.

THE CONCEPTS HAVE BEEN INCLUDED, FOR THE MOST PART, IN A CSC PROPOSED REVISION OF THE BACK PAY ACT REGULATIONS WHICH IS PRESENTLY CIRCULATING FOR COMMENTS TO AGENCIES, FEDERAL EMPLOYEE LABOR ORGANIZATIONS, AND OTHER CONCERNED PARTIES.

IN ADDITION TO THE CONCEPTUAL CHANGES DISCUSSED ABOVE, THE CSC'S PROPOSED REVISIONS WOULD EXPAND THE MEANING OF "PAY, ALLOWANCES, OR DIFFERENTIALS" TO INCLUDE, IN ADDITION TO THE USUAL SALARY AND PREMIUM PAY BENEFITS, AND THE RESTORATION OF ANNUAL LEAVE, SICK LEAVE, AND HEALTH AND LIFE INSURANCE PERMITTED UNDER THE PRESENT REGULATIONS, A NUMBER OF OTHER BENEFITS WHICH ARE DIRECT PERQUISITES OF FEDERAL EMPLOYMENT. NO DECISIONS INVOLVING AWARDS OF COMPENSATION IN THE SITUATIONS DESCRIBED BELOW HAVE BEEN RENDERED TO DATE, OF COURSE, THEY ARE OFFERED AS ILLUSTRATIONS OF POTENTIALLY ALLOWABLE AWARDS, IF THE NEW REGULATIONS ARE PROMULGATED IN THEIR PRESENT FORM. NOTE THAT IN EACH INSTANCE THE BENEFIT IS ONE TO WHICH THE EMPLOYEE WAS ENTITLED BY VIRTUE OF HIS FEDERAL EMPLOYMENT STATUS. BENEFITS HE MIGHT HAVE BEEN ENJOYING AT THE TIME THE WRONGFUL ACTION TOOK PLACE BUT WHICH WERE NOT ENTITLEMENTS ARE NOT COMPENSABLE.

1. TRAVEL AND TRANSPORTATION COSTS AND COSTS INCURRED IN THE STORAGE OF HOUSEHOLD GOODS, SHIPMENT OF HOUSEHOLD GOODS AND SHIPMENT OF PRIVATELY OWNED AUTOMOBILE.

EXAMPLE: A LARGE AGENCY IN THE EXECUTIVE BRANCH HAS ADOPTED A POLICY, AS PART OF A COLLECTIVE BARGAINING AGREEMENT, OF PAYING TRAVEL AND TRANSPORTATION EXPENSES OF NEW APPOINTEE MEDICAL OFFICERS, A MANPOWER SHORTAGE POSITION, FROM THEIR RESIDENCES AT THE TIME OF SELECTION TO THEIR FIRST DUTY STATIONS, PURSUANT TO 5 U.S.C. 5723 AND IMPLEMENTING REGULATIONS.

THIS POLICY IS VIOLATED BY A SUBORDINATE ELEMENT OF THE AGENCY WHICH FAILS TO AUTHORIZE THE PAYMENT OF SUCH EXPENSE FOR A NEW APPOINTEE MEDICAL OFFICER. SUBSEQUENTLY, THIS MEDICAL OFFICER DISCOVERS THAT ALL HIS FELLOW MEDICAL OFFICERS HAVE BEEN PAID TRAVEL AND TRANSPORTATION EXPENSE TO THEIR FIRST DUTY STATIONS AND HE THEREFORE SUBMITS A CLAIM FOR HIS TRAVEL AND TRANSPORTATION EXPENSES. THE AGENCY DENIES HIS CLAIM AND A GRIEVANCE ARBITRATOR FINDS THAT THE DENIAL WAS AN UNWARRANTED PERSONNEL ACTION SINCE THE COLLECTIVE BARGAINING AGREEMENT MADE IT MANDATORY TO PAY SUCH EXPENSES TO NEW APPOINTEE MEDICAL OFFICERS. THE ARBITRATOR COULD ORDER THE AGENCY TO PAY THESE EXPENSES RETROACTIVELY IN ORDER TO MAKE HIM WHOLE.

2. HOME LEAVE.

EXAMPLE: AN EMPLOYEE ASSIGNED OVERSEAS IN GERMANY IS SEPARATED FROM HIS POSITION IN A REDUCTION-IN-FORCE ACTION AND RETURNED AT GOVERNMENT EXPENSE TO HIS ACTUAL RESIDENCE IN THE UNITED STATES. UPON REINSTATEMENT, ON THE BASIS THAT HIS SEPARATION WAS AN UNJUSTIFIED PERSONNEL ACTION, HE APPARENTLY WOULD BE ENTITLED TO REMAIN IN THE UNITED STATES ON HOME LEAVE, IF ELIGIBLE UNDER THE PROVISIONS OF 5 C.F.R. SEC. 630.606 (1974), BEFORE RETURNING TO HIS OVERSEAS POSITION.

EXAMPLES OF RECENT DECISIONS PROVIDING MAKE-WHOLE REMEDIES UNDER THE BACK PAY STATUTE AND IMPLEMENTING REGULATIONS ARE SUMMARIZED BELOW.

RETROACTIVE PROMOTIONS. WHERE AN APPROPRIATE AUTHORITY SUCH AS AN AGENCY HEAD OR AN OFFICIAL DESIGNATED BY HIM, THE CIVIL SERVICE COMMISSION, THE COMPTROLLER GENERAL, A COURT OF COMPETENT JURISDICTION OR AN ARBITRATOR IN A BINDING LABOR-MANAGEMENT ARBITRATION CASE DETERMINES THAT AN EMPLOYEE HAS UNDERGONE AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION BY VIRTUE OF NOT RECEIVING A PROMOTION, TEMPORARY OR PERMANENT, ON A SPECIFIED DATE TO WHICH HE WAS ENTITLED UNDER AGENCY REGULATIONS OR A COLLECTIVE BARGAINING AGREEMENT, SUCH EMPLOYEE MAY BE AWARDED THE PROMOTION RETROACTIVELY, TOGETHER WITH BACK PAY, ALLOWANCES AND DIFFERENTIALS. B-180311, OCTOBER 4, 1974, 54 COMP. GEN. ; B 180010, OCTOBER 31, 1974, 54 ID. ; B-181173, NOVEMBER 13, 1974, 54 ID. ; B-181069, NOVEMBER 20, 1974, 54 ID. ; B- 180010, DECEMBER 2, 1974, 54 ID. ; B-181271, DECEMBER 30, 1974, 54 ID. .

SEPARATIONS AND REMOVALS. IN CASES WHERE AN APPROPRIATE AUTHORITY HAS DETERMINED THAT AN EMPLOYEE HAS BEEN IMPROPERLY REMOVED OR SEPARATED IN VIOLATION OF A MANDATORY REQUIREMENT, THEREBY CONSTITUTING AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION, THE EMPLOYEE IS ENTITLED TO BE REINSTATED ON A RETROACTIVE BASIS WITH BACK PAY, ALLOWANCES AND DIFFERENTIALS FROM THE DATE THE IMPROPER ACTION WAS EFFECTIVE, PURSUANT TO APPLICABLE REGULATIONS. 53 COMP. GEN. 824 (1974). THIS REMEDY HAS EVEN BEEN APPLIED IN A CASE WHERE AN INDIVIDUAL RECEIVED AN OFFER OF EMPLOYMENT (NEW APPOINTMENT) THAT WAS SUBSEQUENTLY WITHDRAWN BY THE AGENCY. IT WAS DETERMINED THAT THE AGENCY'S WITHDRAWAL OF ITS EMPLOYMENT OFFER CONSTITUTED CONSTRUCTIVELY AN IMPROPER DISCHARGE, AND REINSTATEMENT OF THE EMPLOYEE TOGETHER WITH BACK PAY ALLOWANCES AND DIFFERENTIALS WAS ORDERED FROM THE ORIGINAL APPOINTMENT DATE AS SET FORTH IN THE OFFER. B-175373, APRIL 21, 1972.

SUSPENSIONS, FURLOUGHS WITHOUT PAY AND PERIODS OF ENFORCED LEAVE. BACK PAY ALLOWANCES AND DIFFERENTIALS HAVE BEEN ALLOWED FOR EMPLOYEES WHO WERE SUSPENDED OR PLACED ON INVOLUNTARY LEAVE IN CONNECTION WITH PERSONNEL ACTIONS THAT WERE SUBSEQUENTLY DETERMINED BY APPROPRIATE AUTHORITIES TO HAVE BEEN UNJUSTIFIED OR UNWARRANTED. 39 COMP. GEN. 154 (1959), ABBETT V. UNITED STATES, 381 F.2D 609 (5TH CIR. 1967), SEEBACH V. UNITED STATES, 182 CT. CL. 342 (1968). AN EMPLOYEE, WHOSE AGENCY VIOLATED A COLLECTIVE BARGAINING AGREEMENT TO "MAKE EVERY EFFORT" TO FIND HIM LIMITED DUTY WORK AFTER HE WAS INJURED ON THE JOB AND INSTEAD PLACED HIM ON EXTENDED ADMINISTRATIVE LEAVE, MAY BE GIVEN RETROACTIVE PAY FOR THE JOB HE COULD HAVE PERFORMED BUT FOR THE AGENCY'S FAILURE TO COMPLY WITH THE AGREEMENT. 53 COMP. GEN. , JUNE 25, 1974.

EMPLOYEES WHO WERE PLACED ON VOLUNTARY ANNUAL LEAVE IN LIEU OF SUSPENSION STATUS OR SUSPENDED FROM THEIR POSITIONS AS A RESULT OF MISCONDUCT CHARGES THAT WERE LATER CANCELLED AND DETERMINED TO HAVE BEEN UNJUSTIFIED AND UNWARRANTED PERSONNEL ACTIONS, WERE RECREDITED WITH THE LEAVE THEY USED AS A RESULT OF THE IMPROPER AGENCY ACTION. B 178712, JULY 16, 1973. SIMILARLY, BACK PAY, ALLOWANCES AND DIFFERENTIALS WERE ALLOWED FOR AN EMPLOYEE WHO TOOK LEAVE WITHOUT PAY IN CONNECTION WITH AN IMPROPER REDUCTION-IN-FORCE ACTION WHEN HE WAS OFFERED AND ACCEPTED THE OPPORTUNITY OF EXTENDING THE NORMAL 60-DAY NOTICE OF SEPARATION PERIOD BY 30 DAYS IN A LEAVE-WITHOUT-PAY STATUS. B-172195(.05), NOVEMBER 23, 1971. SIMILARLY, WHEN AN EMPLOYEE HAS TAKEN ANNUAL LEAVE INCIDENT TO AN AUTHORIZED EXTENSION OF REDUCTION-IN FORCE NOTICE PERIOD, WE HAVE ALLOWED SUCH LEAVE TO BE RECREDITED TO THE EMPLOYEE'S ACCOUNT UPON A DETERMINATION BY APPROPRIATE AUTHORITY THAT THE REDUCTION IN FORCE WAS AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION. B-176846, OCTOBER 25, 1972.

RETROACTIVE PERIODIC STEP INCREASES. RETROACTIVE PERIODIC STEP INCREASES TOGETHER WITH BACK PAY HAVE BEEN ALLOWED EMPLOYEES, UPON A DETERMINATION BY APPROPRIATE AUTHORITY THAT SUCH STEP INCREASES WERE DELAYED AS A RESULT OF ADMINISTRATIVE ERROR OR UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTIONS. 37 COMP. GEN. 300 (1957), 37 ID. 774 (1958), B-173976(.10), JULY 11, 1972.

RETROACTIVE CHANGE IN APPOINTMENTS. A RETROACTIVE CHANGE IN APPOINTMENT TOGETHER WITH BACK PAY HAS BEEN PERMITTED UPON A DETERMINATION BY APPROPRIATE AUTHORITY THAT AN EMPLOYEE WAS INITIALLY APPOINTED IN A LOWER GRADE THAN THE GRADE REQUIRED BY NONDISCRETIONARY AGENCY POLICY. 181223, JULY 29, 1974.

ENVIRONMENTAL AND HAZARDOUS DUTY DIFFERENTIALS. WHERE EMPLOYEES ARE SUBSEQUENTLY DETERMINED BY APPROPRIATE AUTHORITY TO HAVE WORKED UNDER ENVIRONMENTAL OR HAZARDOUS CONDITIONS ENTITLING THEM TO ADDITIONAL COMPENSATION, BACK PAY FOR SUCH DIFFERENTIALS HAS BEEN PERMITTED. COMP. GEN. 789 (1974), B-163901, MAY 2, 1973.

RETROACTIVE ADJUSTMENT OF RATE OF PAY. BACK PAY HAS BEEN ALLOWED IN A CASE WHERE THE STEP RATE OF A PREVAILING RATE EMPLOYEE WHO HAS CONVERTED TO THE GENERAL SCHEDULE WAS DETERMINED BY APPROPRIATE AUTHORITY TO HAVE BEEN SET AT A LOWER RATE THAN REQUIRED BY APPLICABLE REGULATIONS. COMP. GEN. 656 (1972). AN EMPLOYEE WHO WAS DENIED THE BENEFIT OF THE HIGHEST PREVIOUS RATE RULE WHICH THE AGENCY ADMITS HE WOULD HAVE RECEIVED IF HE HAD BEEN WILLING TO DROP CERTAIN GRIEVANCE ACTIONS INITIATED BY HIM, WAS AWARDED THE RATE RETROACTIVELY SINCE THE AGENCY'S TERMS WERE IMPROPER AND IN CARRYING OUT ITS THREAT TO AWARD HIM THE LOWER RATE IF HE DID NOT DROP HIS GRIEVANCE ACTIONS, IT HAD COMMITTED AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION. B-180997, OCTOBER 30, 1974.

POST DIFFERENTIAL AND LIVING QUARTERS ALLOWANCES. THE BACK PAY ACT HAS BEEN APPLIED TO COMPENSATE AN EMPLOYEE RETROACTIVELY WHO WAS REMOVED WHILE STATIONED OVERSEAS AND ENTITLED TO A POST DIFFERENTIAL UNDER A PROVISION OF LAW SUCH AS 5 U.S.C. SEC. 5925 (1970). THE EMPLOYEE WAS TRANSPORTED BACK TO THE UNITED STATES WHERE HE PROCEEDED WITH LEGAL ACTION THAT ULTIMATELY SUCCEEDED IN HIS REINSTATEMENT. ALTHOUGH THE EMPLOYEE REMAINED IN THE UNITED STATES THROUGHOUT THE PERIOD HIS LEGAL ACTION WAS PENDING, HIS ENTITLEMENT TO A POST DIFFERENTIAL WAS INCLUDED IN THE AWARD SINCE HE WOULD HAVE RECEIVED IT BUT FOR HIS UNJUSTIFIED REMOVAL. VITARALLI V. UNITED STATES, 150 CT. CL. 59 (1960). THE BACK PAY ACT HAS BEEN APPLIED TO COMPENSATE AN EMPLOYEE STATIONED OVERSEAS WHO, AT THE TIME OF AN UNJUSTIFIED REMOVAL, WAS RECEIVING A LIVING QUARTERS ALLOWANCE PURSUANT TO 5 U.S.C. SEC. 5923 (1970) AND, SECTION 031, DEPARTMENT OF STATE STANDARDIZED REGULATIONS (GOVERNMENT CIVILIANS, FOREIGN AREAS). THE LIVING QUARTERS ALLOWANCE WAS INCLUDED IN A BACK PAY AWARD DESPITE THE FACT THAT THE EMPLOYEE HAD BEEN RETURNED TO THE UNITED STATES AT THE TIME OF REMOVAL. URBINA V. UNITED STATES, 192 CT. CL. 875 (1970).

TRAVEL EXPENSES DIRECTLY INCIDENT TO SUCCESSFUL APPEAL. THE BACK PAY ACT CONTEMPLATES THAT A REINSTATED EMPLOYEE PERFORMED SERVICE FOR THE AGENCY DURING THE PERIOD THE IMPROPER PERSONNEL ACTION WAS IN EFFECT JUST AS IF THE UNWARRANTED ACTION HAD NOT OCCURRED. PURSUANT TO THIS STATUTORY RATIONALE, WE REGARD THE REINSTATED EMPLOYEE AS HAVING BEEN IN A TEMPORARY DUTY STATUS DURING PERIODS HE WAS REQUIRED TO TRAVEL IN ORDER TO PROSECUTE HIS APPEAL. ACCORDINGLY, WE HAVE ALLOWED SUCH TEMPORARY DUTY TRAVEL EXPENSES IN PROSECUTING SUCCESSFUL APPEALS. B-180469, FEBRUARY 28, 1974.

OTHER MAKE-WHOLE REMEDIES PROVIDED BY LAW AND REGULATIONS

1. HEALTH INSURANCE FOR RESTORED EMPLOYEES

THE MAKE-WHOLE REMEDY CONCERNING HEALTH INSURANCE FOR REINSTATED EMPLOYEES WHO WERE IMPROPERLY REMOVED IS GOVERNED BY 5 U.S.C. SEC. 8908 (1970), WHICH PROVIDES:

"SEC. 8908. COVERAGE OF RESTORED EMPLOYEE

"AN EMPLOYEE ENROLLED IN A HEALTH BENEFITS PLAN UNDER THIS CHAPTER WHO IS REMOVED OR SUSPENDED WITHOUT PAY AND LATER REINSTATED OR RESTORED TO DUTY ON THE GROUND THAT THE REMOVAL OR SUSPENSION WAS UNJUSTIFIED OR UNWARRANTED MAY, AT HIS OPTION, ENROLL AS A NEW EMPLOYEE OR HAVE HIS COVERAGE RESTORED, WITH APPROPRIATE ADJUSTMENTS MADE IN CONTRIBUTIONS AND CLAIMS, TO THE SAME EXTENT AND EFFECT AS THOUGH THE REMOVAL OR SUSPENSION HAD NOT TAKEN PLACE."

CIVIL SERVICE COMMISSION REGULATIONS IMPLEMENTING THIS STATUTE ARE CONTAINED IN PARAGRAPH S8-5, FEDERAL PERSONNEL MANUAL SUPPLEMENT 890-1, INSTRUCTION 34, DATED SEPTEMBER 24, 1973, WHICH READS AS FOLLOWS:

"S8-5. RESTORATION TO DUTY AFTER ERRONEOUS REMOVAL OR SUSPENSION

"A. EMPLOYEE ELECTION. THE ENROLLMENT OF AN EMPLOYEE WHO IS SUSPENDED WITHOUT PAY CONTINUES FOR UP TO 365 DAYS IN NONPAY STATUS, AS STATED IN S8 -4A. THE ENROLLMENT OF AN EMPLOYEE WHO IS REMOVED IS TERMINATED AT THE END OF THE PAY PERIOD IN WHICH HE IS REMOVED. IF THE ENROLLMENT OF AN EMPLOYEE WHO WAS REMOVED OR SUSPENDED WITHOUT PAY WAS TERMINATED, AND THE EMPLOYEE IS ORDERED RESTORED TO DUTY ON THE GROUNDS THAT THE SUSPENSION OR REMOVAL WAS UNWARRANTED OR UNJUSTIFIED, HE MAY ELECT EITHER TO (1) HAVE HIS PRIOR ENROLLMENT REINSTATED RETROACTIVE TO THE DATE IT WAS TERMINATED, OR (2) ENROLL IN THE PLAN AND OPTION OF HIS CHOICE, THE SAME AS A NEW EMPLOYEE.

"B. REINSTATEMENT OF ENROLLMENT. IF THE EMPLOYEE ELECTS TO HAVE HIS PRIOR ENROLLMENT REINSTATED RETROACTIVELY, WITHHOLDINGS AND CONTRIBUTIONS MUST ALSO BE MADE RETROACTIVELY JUST AS THOUGH THE ERRONEOUS SUSPENSION OR REMOVAL HAD NOT TAKEN PLACE. HIS HEALTH BENEFITS COVERAGE IS CONSIDERED TO HAVE BEEN CONTINUOUSLY IN EFFECT, AND HE AND ANY COVERED FAMILY MEMBERS WILL BE RETROACTIVELY ENTITLED TO THE FULL BENEFITS OF HIS PLAN.

"C. NEW ENROLLMENT. IF THE EMPLOYEE ELECTS TO ENROLL INSTEAD OF HAVING HIS PRIOR ENROLLMENT REINSTATED, HIS ENROLLMENT WOULD BE EFFECTIVE AS STATED IN S7-2B. HE IS NOT RETROACTIVELY ENTITLED TO BENEFITS FROM HIS PLAN AND NO RETROACTIVE WITHHOLDINGS AND CONTRIBUTIONS SHOULD BE MADE.

"D. NOTICE TO EMPLOYEES. AN EMPLOYEE ORDERED RESTORED TO DUTY AFTER ERRONEOUS REMOVAL OR SUSPENSION SHOULD BE NOTIFIED OF THE CHOICES OPEN TO HIM REGARDING HIS HEALTH BENEFITS COVERAGE. HE ALSO SHOULD BE ADVISED THAT IF HE ELECTS TO ENROLL AS A NEW EMPLOYEE, THE PERIOD OF HIS SUSPENSION OR REMOVAL (DURING WHICH HIS ENROLLMENT WAS NOT IN EFFECT) WILL NOT BE CONSIDERED AS AN INTERRUPTION TO HIS CONTINUOUS ENROLLMENT FOR PURPOSES OF CONTINUING ENROLLMENT AFTER RETIREMENT, PROVIDED HE ENROLLS WITHIN 31 DAYS AFTER THE DATE HE IS ORDERED RESTORED TO DUTY."

IT IS NOTED THAT THE REMEDY PROVIDED BY THE ABOVE-QUOTED STATUTE AND REGULATION IS SUFFICIENT FOR MOST CASES. HOWEVER, IT DOES NOT APPEAR TO ADEQUATELY COVER THE EMPLOYEE WHO, WHEN REMOVED, PURCHASES SIMILAR COVERAGE ON THE COMMERCIAL MARKET. SEE TAB C.6 FOR DISCUSSION OF THE PROBLEM.

2. GOVERNMENT LIFE INSURANCE FOR RESTORED EMPLOYEES

THE MAKE-WHOLE REMEDY REGARDING GOVERNMENT LIFE INSURANCE FOR A GOVERNMENT EMPLOYEE WHO IS REINSTATED ON THE BASIS OF A FINDING THAT HE HAD UNDERGONE AN UNJUSTIFIED PERSONNEL ACTION IS COVERED BY 5 U.S.C. SEC. 8706(F) (SUPP. III, 1973), AND PROVIDES:

"(F) IF THE INSURANCE OF AN EMPLOYEE STOPS BECAUSE OF SEPARATION FROM THE SERVICE OR SUSPENSION WITHOUT PAY, AND THE SEPARATION OR SUSPENSION IS THEREAFTER OFFICIALLY FOUND TO HAVE BEEN ERRONEOUS, THE EMPLOYEE IS DEEMED TO HAVE BEEN INSURED DURING THE PERIOD OF ERRONEOUS SEPARATION OR SUSPENSION. DEDUCTIONS OTHERWISE REQUIRED BY SECTION 8707 OF THIS CHAPTER SHALL NOT BE WITHHELD FROM ANY BACK PAY AWARDED FOR THE PERIOD OF SEPARATION OR SUSPENSION UNLESS DEATH OR ACCIDENTAL DISMEMBERMENT OF THE EMPLOYEE OCCURS DURING SUCH PERIOD."

CIVIL SERVICE COMMISSION REGULATIONS IMPLEMENTING THIS STATUTE ARE CONTAINED IN PARAGRAPH S4-2E, FEDERAL PERSONNEL MANUAL SUPPLEMENT 870 1, INSTRUCTION 14, DATED SEPTEMBER 12, 1973, AND PROVIDE AS FOLLOWS:

"E. RESTORATION AFTER ERRONEOUS SUSPENSION OR REMOVAL. EFFECTIVE ON OR AFTER OCTOBER 21, 1972, IF AN EMPLOYEE IS RETROACTIVELY RESTORED TO DUTY WITH PAY AFTER AN ERRONEOUS SUSPENSION OR REMOVAL, THERE WILL BE NO LIFE INSURANCE WITHHOLDINGS MADE FROM THE RETROACTIVE PAY ADJUSTMENT FOR THE PERIOD OF SUSPENSION OR REMOVAL. HOWEVER, IF DEATH OR ACCIDENTAL DISMEMBERMENT OCCURS DURING THE PERIOD BETWEEN THE EMPLOYEE'S REMOVAL AND THE FINDING THAT THE SEPARATION OR SUSPENSION WAS ERRONEOUS, INSURANCE PROCEEDS WILL BE PAID AND PREMIUMS WILL BE WITHHELD FROM BACK PAY AWARDED FOR THE PERIOD OF SEPARATION OR SUSPENSION. WHERE PAYMENT OF BACK PAY WAS MADE BEFORE OCTOBER 21, 1972, WITHHOLDINGS FOR THE PERIOD OF SUSPENSION OR REMOVAL MUST BE MADE FROM THE PAY ADJUSTMENT."

THE ABOVE STATUTE AND REGULATION APPEARS TO PROVIDE A COMPLETE MAKE WHOLE REMEDY IN THE AREA OF GOVERNMENT LIFE INSURANCE FOR REINSTATED EMPLOYEES.

3. EMPLOYMENT DISCRIMINATION

TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED, PUB. L. 88 352, JULY 2, 1964, 42 U.S.C. 2000E-2(A), DECLARES IT TO BE AN UNLAWFUL EMPLOYMENT PRACTICE.

"(1) TO FAIL OR REFUSE TO HIRE OR TO DISCHARGE ANY INDIVIDUAL, OR OTHERWISE TO DISCRIMINATE AGAINST ANY INDIVIDUAL WITH RESPECT TO HIS COMPENSATION, TERMS, CONDITIONS, OR PRIVILEGES OF EMPLOYMENT, BECAUSE OF SUCH INDIVIDUAL'S RACE, COLOR, RELIGION, SEX, OR NATIONAL ORIGIN; OR

"(2) TO LIMIT, SEGREGATE, OR CLASSIFY HIS EMPLOYEES OR APPLICANTS FOR EMPLOYMENT IN ANY WAY WHICH WOULD DEPRIVE OR TEND TO DEPRIVE ANY INDIVIDUAL OF EMPLOYMENT OPPORTUNITIES OR OTHERWISE ADVERSELY AFFECT HIS STATUS AS AN EMPLOYEE, BECAUSE OF SUCH INDIVIDUAL'S RACE, COLOR, RELIGION, SEX, OR NATIONAL ORIGIN."

THE SECTION IS MADE APPLICABLE TO THE FEDERAL GOVERNMENT AS AN EMPLOYER BY THE EQUAL EMPLOYMENT OPPORTUNITY ACT OF 1972, PUB. L. 92 261, MARCH 24, 1972, 42 U.S.C. 2000E-16(A).

THE MAKE-WHOLE REMEDY FOR FAILURE TO PROVIDE EQUAL EMPLOYMENT OPPORTUNITY IN SELECTING EMPLOYEES FOR GOVERNMENT SERVICE IS GOVERNED BY 42 U.S.C. SEC. 2000E-16(B), WHICH PROVIDES IN PERTINENT PART:

"(B) CIVIL SERVICE COMMISSION; ENFORCEMENT POWERS; ISSUANCE OF RULES, REGULATIONS, ETC; ANNUAL REVIEW AND APPROVAL OF NATIONAL AND REGIONAL EQUAL EMPLOYMENT OPPORTUNITY PLANS; REVIEW AND EVALUATION OF EQUAL EMPLOYMENT OPPORTUNITY PROGRAMS AND PUBLICATION OF PROGRESS REPORTS; CONSULTATIONS WITH INTERESTED PARTIES; COMPLIANCE WITH RULES, REGULATIONS, ETC.; CONTENTS OF NATIONAL AND REGIONAL EQUAL EMPLOYMENT OPPORTUNITY PLANS; AUTHORITY OF LIBRARIAN OF CONGRESS.

"EXCEPT AS OTHERWISE PROVIDED IN THIS SUBSECTION, THE CIVIL SERVICE COMMISSION SHALL HAVE AUTHORITY TO ENFORCE THE PROVISIONS OF SUBSECTION (A) OF THIS SECTION THROUGH APPROPRIATE REMEDIES, INCLUDING REINSTATEMENT OR HIRING OF EMPLOYEES WITH OR WITHOUT BACK PAY, AS WILL EFFECTUATE THE POLICIES OF THIS SECTION, AND SHALL ISSUE SUCH RULES, REGULATIONS, ORDERS AND INSTRUCTIONS AS IT DEEMS NECESSARY AND APPROPRIATE TO CARRY OUT ITS RESPONSIBILITIES UNDER THIS SECTION. ***"

IN ADDITION, COURTS ARE AUTHORIZED TO PROVIDE THE FOLLOWING REMEDIES FOR UNLAWFUL EMPLOYMENT PRACTICES, PURSUANT TO 42 U.S.C. SEC. 2000E 5(G):

"(G) INJUNCTIONS; APPROPRIATE AFFIRMATIVE ACTION; EQUITABLE RELIEF; ACCRUAL OF BACK PAY; REDUCTION OF BACK PAY; LIMITATIONS ON JUDICIAL ORDERS.

"IF THE COURT FINDS THAT THE RESPONDENT HAS INTENTIONALLY ENGAGED IN OR IS INTENTIONALLY ENGAGING IN AN UNLAWFUL EMPLOYMENT PRACTICE CHARGED IN THE COMPLAINT, THE COURT MAY ENJOIN THE RESPONDENT FROM ENGAGING IN SUCH UNLAWFUL EMPLOYMENT PRACTICE, AND ORDER SUCH AFFIRMATIVE ACTION AS MAY BE APPROPRIATE, WHICH MAY INCLUDE, BUT IS NOT LIMITED TO, REINSTATEMENT OR HIRING OF EMPLOYEES, WITH OR WITHOUT BACK PAY (PAYABLE BY THE EMPLOYER, EMPLOYMENT AGENCY, OR LABOR ORGANIZATION, AS THE CASE MAY BE, RESPONSIBLE FOR THE UNLAWFUL EMPLOYMENT PRACTICE), OR ANY OTHER EQUITABLE RELIEF AS THE COURT DEEMS APPROPRIATE. BACK PAY LIABILITY SHALL NOT ACCRUE FROM A DATE MORE THAN TWO YEARS PRIOR TO THE FILING OF A CHARGE WITH THE COMMISSION. INTERIM EARNINGS OR AMOUNTS EARNABLE WITH REASONABLE DILIGENCE BY THE PERSON OR PERSONS DISCRIMINATED AGAINST SHALL OPERATE TO REDUCE THE BACK PAY OTHERWISE ALLOWABLE. NO ORDER OF THE COURT SHALL REQUIRE THE ADMISSION OR REINSTATEMENT OF AN INDIVIDUAL AS A MEMBER OF A UNION, OR THE HIRING, REINSTATEMENT, OR PROMOTION OF AN INDIVIDUAL AS AN EMPLOYEE, OR THE PAYMENT TO HIM OF ANY BACK PAY, IF SUCH INDIVIDUAL WAS REFUSED ADMISSION, SUSPENDED, OR EXPELLED, OR WAS REFUSED EMPLOYMENT OR ADVANCEMENT OR WAS SUSPENDED OR DISCHARGED FOR ANY REASON OTHER THAN DISCRIMINATION ON ACCOUNT OF RACE, COLOR, RELIGION, SEX, OR NATIONAL ORIGIN OR IN VIOLATION OF SECTION 2000E-3(A) OF THIS TITLE." IMPLEMENTING REGULATIONS REGARDING REMEDIAL ACTION FOR DISCRIMINATION IN GOVERNMENT EMPLOYMENT HAVE BEEN PROMULGATED BY THE CIVIL SERVICE COMMISSION IN 5 C.P.R. SEC. 713.271 (1974), AND PROVIDE:

"SEC. 713.271 REMEDIAL ACTIONS.

"(A) REMEDIAL ACTION INVOLVING AN APPLICANT.

(1) WHEN AN AGENCY, OR THE COMMISSION, FINDS THAT AN APPLICANT FOR EMPLOYMENT HAS BEEN DISCRIMINATED AGAINST AND EXCEPT FOR THAT DISCRIMINATION WOULD HAVE BEEN HIRED, THE AGENCY SHALL OFFER THE APPLICANT EMPLOYMENT OF THE TYPE AND GRADE DENIED HIM. THE OFFER SHALL BE MADE IN WRITING. THE INDIVIDUAL SHALL HAVE 15 CALENDAR DAYS FROM RECEIPT OF THE OFFER WITHIN WHICH TO ACCEPT OR DECLINE THE OFFER. FAILURE TO NOTIFY THE AGENCY OF HIS DECISION WITHIN THE 15-DAY PERIOD WILL BE CONSIDERED A DECLINATION OF THE OFFER, UNLESS THE INDIVIDUAL CAN SHOW THAT CIRCUMSTANCES BEYOND HIS CONTROL PREVENTED HIM FROM RESPONDING WITHIN THE TIME LIMIT. IF THE OFFER IS ACCEPTED, APPOINTMENT SHALL BE RETROACTIVE TO THE DATE THE APPLICANT WOULD HAVE BEEN HIRED, SUBJECT TO THE LIMITATION IN SUBPARAGRAPH (4) OF THIS PARAGRAPH. BACK PAY, COMPUTED IN THE SAME MANNER PRESCRIBED BY SEC. 550.804 OF THIS CHAPTER, SHALL BE AWARDED FROM THE BEGINNING OF THE RETROACTIVE PERIOD, SUBJECT TO THE SAME LIMITATION, UNTIL THE DATE THE INDIVIDUAL ACTUALLY ENTERS ON DUTY. THE INDIVIDUAL SHALL BE DEEMED TO HAVE PERFORMED SERVICE FOR THE AGENCY DURING THIS PERIOD OF RETROACTIVITY FOR ALL PURPOSES EXCEPT FOR MEETING SERVICE REQUIREMENTS FOR COMPLETION OF A PROBATIONARY OR TRIAL PERIOD THAT IS REQUIRED. IF THE OFFER IS DECLINED, THE AGENCY SHALL AWARD THE INDIVIDUAL A SUM EQUAL TO THE BACK PAY HE WOULD HAVE RECEIVED, COMPUTED IN THE SAME MANNER PRESCRIBED BY SEC. 550.804 OF THIS CHAPTER, FROM THE DATE HE WOULD HAVE BEEN APPOINTED UNTIL THE DATE THE OFFER WAS MADE, SUBJECT TO THE LIMITATION OF SUBPARAGRAPH (4) OF THIS PARAGRAPH. THE AGENCY SHALL INFORM THE APPLICANT, IN ITS OFFER, OF HIS RIGHT TO THIS AWARD IN THE EVENT HE DECLINES THE OFFER.

"(2) WHEN AN AGENCY, OR THE COMMISSION, FINDS THAT DISCRIMINATION EXISTED AT THE TIME THE APPLICANT WAS CONSIDERED FOR EMPLOYMENT BUT DOES NOT FIND THAT THE INDIVIDUAL IS THE ONE WHO WOULD HAVE BEEN HIRED EXCEPT FOR DISCRIMINATION, THE AGENCY SHALL CONSIDER THE INDIVIDUAL FOR ANY EXISTING VACANCY OF THE TYPE AND GRADE FOR WHICH HE HAD BEEN CONSIDERED INITIALLY AND FOR WHICH HE IS QUALIFIED BEFORE CONSIDERATION IS GIVEN TO OTHER CANDIDATES. IF THE INDIVIDUAL IS NOT SELECTED, THE AGENCY SHALL RECORD THE REASONS FOR NONSELECTION. IF NO VACANCY EXISTS, THE AGENCY SHALL GIVE HIM THIS PRIORITY CONSIDERATION FOR THE NEXT VACANCY FOR WHICH HE IS QUALIFIED. THIS PRIORITY SHALL TAKE PRECEDENCE OVER PRIORITIES PROVIDED UNDER OTHER REGULATIONS IN THIS CHAPTER.

"(3) THIS PARAGRAPH SHALL BE CITED AS THE AUTHORITY UNDER WHICH THE ABOVE -DESCRIBED APPOINTMENTS OR AWARDS OF BACK PAY SHALL BE MADE.

"(4) A PERIOD OF RETROACTIVITY OR A PERIOD FOR WHICH BACK PAY IS AWARDED UNDER THIS PARAGRAPH MAY NOT EXTEND FROM A DATE EARLIER THAN 2 YEARS PRIOR TO THE DATE ON WHICH THE COMPLAINT WAS INITIALLY FILED BY THE APPLICANT. IF A FINDING OF DISCRIMINATION WAS NOT BASED ON A COMPLAINT, THE PERIOD OF RETROACTIVITY OR PERIOD FOR WHICH BACK PAY IS AWARDED THIS PARAGRAPH MAY NOT EXTEND EARLIER THAN 2 YEARS PRIOR TO THE DATE THE FINDING OF DISCRIMINATION WAS RECORDED.

"(B) REMEDIAL ACTION INVOLVING AN EMPLOYEE. WHEN AN AGENCY, OR THE COMMISSION, FINDS THAT AN EMPLOYEE OF THE AGENCY WAS DISCRIMINATED AGAINST AND AS A RESULT OF THAT DISCRIMINATION WAS DENIED AN EMPLOYMENT BENEFIT, OR AN ADMINISTRATIVE DECISION ADVERSE TO HIM WAS MADE, THE AGENCY SHALL TAKE REMEDIAL ACTIONS WHICH SHALL INCLUDE ONE OR MORE OF THE FOLLOWING, BUT NEED NOT BE LIMITED TO THESE ACTIONS:

"(1) RETROACTIVE PROMOTION, WITH BACK PAY COMPUTED IN THE SAME MANNER PRESCRIBED BY SEC. 550.804 OF THIS CHAPTER, WHEN THE RECORD CLEARLY SHOWS THAT BUT FOR THE DISCRIMINATION THE EMPLOYEE WOULD HAVE BEEN PROMOTED OR WOULD HAVE BEEN EMPLOYED AT A HIGHER GRADE, EXCEPT THAT THE BACK PAY LIABILITY MAY NOT ACCRUE FROM A DATE EARLIER THAN 2 YEARS PRIOR TO THE DATE THE DISCRIMINATION COMPLAINT WAS FILED, BUT, IN ANY EVENT, NOT TO EXCEED THE DATE HE WOULD HAVE BEEN PROMOTED. IF A FINDING OF DISCRIMINATION WAS NOT BASED ON A COMPLAINT, THE BACK PAY LIABILITY MAY NOT ACCRUE FROM A DATE EARLIER THAN 2 YEARS PRIOR TO THE DATE THE FINDING OF DISCRIMINATION WAS RECORDED, BUT, IN ANY EVENT, NOT TO EXCEED THE DATE HE WOULD HAVE BEEN PROMOTED.

"(2) CONSIDERATION FOR PROMOTION TO A POSITION FOR WHICH HE IS QUALIFIED BEFORE CONSIDERATION IS GIVEN TO OTHER CANDIDATES WHEN THE RECORD SHOWS THAT DISCRIMINATION EXISTED AT THE TIME SELECTION FOR PROMOTION WAS MADE BUT IT IS NOT CLEAR THAT EXCEPT FOR THE DISCRIMINATION THE EMPLOYEE WOULD HAVE BEEN PROMOTED. IF THE INDIVIDUAL IS NOT SELECTED, THE AGENCY SHALL RECORD THE REASONS FOR NONSELECTION. THIS PRIORITY CONSIDERATION SHALL TAKE PRECEDENCE OVER PRIORITIES UNDER OTHER REGULATIONS IN THIS CHAPTER.

"(3) CANCELLATION OF AN UNWARRANTED PERSONNEL ACTION AND RESTORATION OF THE EMPLOYEE.

"(4) EXPUNCTION FROM THE AGENCY'S RECORDS OF ANY REFERENCE TO OR ANY RECORD OF AN UNWARRANTED DISCIPLINARY ACTION THAT IS NOT A PERSONNEL ACTION.

"(5) FULL OPPORTUNITY TO PARTICIPATE IN THE EMPLOYEE BENEFIT DENIED HIM (E.G., TRAINING, PREFERENTIAL WORK ASSIGNMENTS, OVERTIME SCHEDULING)."

WE NOTE THAT BACK PAY UNDER THE EQUAL EMPLOYMENT OPPORTUNITY ACT (EEOA) AND ITS IMPLEMENTING REGULATION IS COMPUTED IN THE SAME MANNER PRESCRIBED BY 5 C.F.R. SEC. 550.894 FOR THE BACK PAY ACT OF 1966, SUPRA. THERE ARE SOME SIGNIFICANT DIFFERENCES BETWEEN REMEDIES PROVIDED IN THE TWO STATUTES AND REGULATIONS WHICH HAVE A BEARING ON THE EXTENT EMPLOYEES ARE MADE WHOLE. UNDER THE EEOA THE PERIOD OF RETROACTIVITY FOR WHICH BACK PAY IS PERMITTED MAY NOT EXTEND BACK FARTHER THAN 2 YEARS. THERE IS NO SUCH LIMITATION ON BACK PAY FOR OTHER UNJUSTIFIED AND UNWARRANTED PERSONNEL ACTIONS UNDER THE BACK PAY ACT. FOR EXAMPLE, AN EMPLOYEE WHO 3 YEARS AGO WAS NOT PROMOTED BECAUSE OF RACIAL OR SEX DISCRIMINATION WOULD RECEIVE ONLY 2 YEARS OF BACK PAY UNDER THE EEOA BUT AN EMPLOYEE WHO 3 YEARS AGO WAS NOT PROMOTED BY VIRTUE OF AN ADMINISTRATIVE OVERSIGHT WOULD RECEIVE RETROACTIVE COMPENSATION FOR THE FULL PERIOD UNDER THE BACK PAY ACT.

IN SOME RESPECTS REMEDIES UNDER THE EQUAL OPPORTUNITY REGULATION ARE BROADER THAN THE BACK PAY REGULATIONS IN THAT THE EQUAL OPPORTUNITY REGULATIONS PROVIDE FOR EXPUNGEMENT FROM THE RECORDS OF AN UNWARRANTED DISCIPLINARY ACTION.

4. UNFAIR LABOR PRACTICE REMEDIES

THE ASSISTANT SECRETARY OF LABOR FOR LABOR-MANAGEMENT RELATIONS (A/SLMR), PURSUANT TO EXECUTIVE ORDER 11491, AS AMENDED, IS AUTHORIZED TO DECIDE UNFAIR LABOR PRACTICE (ULP) COMPLAINTS AND TO REQUIRE AGENCIES AND LABOR ORGANIZATIONS TO TAKE CORRECTIVE ACTION WHEN HE FINDS A ULP HAS OCCURRED. IN THIS REGARD SECTIONS 6(A)(4) AND 6(B) OF THE ORDER PROVIDE:

"SEC. 6. ASSISTANT SECRETARY OF LABOR FOR LABOR-MANAGEMENT RELATIONS.

"(A) THE ASSISTANT SECRETARY SHALL -

"(4) DECIDE UNFAIR LABOR PRACTICE COMPLAINTS AND ALLEGED VIOLATIONS OF THE STANDARDS OF CONDUCT FOR LABOR ORGANIZATIONS ***.

"(B) IN ANY MATTTERS ARISING UNDER PARAGRAPH (A) OF THIS SECTION, THE ASSISTANT SECRETARY MAY REQUIRE AN AGENCY OR A LABOR ORGANIZATION TO CEASE AND DESIST FROM VIOLATIONS OF THIS ORDER AND REQUIRE IT TO TAKE SUCH AFFIRMATIVE ACTION AS HE CONSIDERS APPROPRIATE TO EFFECTUATE THE POLICIES OF THIS ORDER."

IF THE A/SLMR FINDS THAT AN EMPLOYEE HAS BEEN DISCRIMINATED AGAINST BECAUSE OF UNION ACTIVITY, UNDER THE ABOVE-QUOTED PROVISIONS OF THE ORDER HE MAY DIRECT THE AGENCY TO TAKE ACTION TO MAKE THE EMPLOYEE WHOLE. ALL REMEDIAL MEASURES PROVIDED BY LAW AND REGULATION ARE AVAILABLE TO THE A/SLMR TO MAKE THE EMPLOYEE WHOLE SUCH AS BACK PAY AND RETROACTIVE PROMOTIONS. THE PROPOSED NEW CSC REGULATIONS TO THE BACK PAY ACT, NOW CIRCULATING FOR COMMENT, WILL MAKE IT CLEAR THAT DISCRIMINATION AGAINST AN EMPLOYEE BECAUSE OF HIS UNION ACTIVITIES IS AS MUCH AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION AS IS DISCRIMINATION ON ANY OTHER NONPERMISSIBLE GROUNDS.

5. WAIVER OF CLAIMS AGAINST EMPLOYEES

ANOTHER REMEDY IN LAW SOMETIMES USEFUL TO CORRECT ERRORS RESULTING FROM CERTAIN ERRONEOUS OVERPAYMENTS TO AN EMPLOYEE IS THE CLAIMS WAIVER STATUTE CONTAINED IN 5 U.S.C. SEC. 5584 (1974), WHICH PROVIDES IN PERTINENT PART:

"SEC. 5584. CLAIMS FOR OVERPAYMENT OF PAY AND ALLOWANCES, OTHER THAN TRAVEL AND TRANSPORTATION EXPENSES AND ALLOWANCES AND RELOCATION EXPENSES

"(A) A CLAIM OF THE UNITED STATES AGAINST A PERSON ARISING OUT OF AN ERRONEOUS PAYMENT OF PAY OR ALLOWANCES, OTHER THAN TRAVEL AND TRANSPORTATION EXPENSES AND ALLOWANCES AND RELOCATION EXPENSES PAYABLE UNDER SECTION 5724A OF THIS TITLE, ON OR AFTER JULY 1, 1960, TO AN EMPLOYEE OF AN EXECUTIVE AGENCY, THE COLLECTION OF WHICH WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE AND NOT IN THE BEST INTERESTS OF THE UNITED STATES, MAY BE WAIVED IN WHOLE OR IN PART BY -

"(1) THE COMPTROLLER GENERAL OF THE UNITED STATES; OR

"(2) THE HEAD OF THE EXECUTIVE AGENCY WHEN -

"(A) THE CLAIM IS IN AN AMOUNT AGGREGATING NOT MORE THAN $500;

"(B) THE CLAIM IS NOT THE SUBJECT OF AN EXCEPTION MADE BY THE COMPTROLLER GENERAL IN THE ACCOUNT OF ANY ACCOUNTABLE OFFICIAL; AND

"(C) THE WAIVER IS MADE IN ACCORDANCE WITH STANDARDS WHICH THE COMPTROLLER GENERAL SHALL PRESCRIBE.

"(B) THE COMPTROLLER GENERAL OR THE HEAD OF THE EXECUTIVE AGENCY, AS THE CASE MAY BE, MAY NOT EXERCISE HIS AUTHORITY UNDER THIS SECTION TO WAIVE ANY CLAIM -

"(1) IF, IN HIS OPINION, THERE EXISTS, IN CONNECTION WITH THE CLAIM, AN INDICATION OF FRAUD, MISREPRESENTATION, FAULT, OR LACK OF GOOD FAITH ON THE PART OF THE EMPLOYEE OR ANY OTHER PERSON HAVING AN INTEREST IN OBTAINING A WAIVER OF THE CLAIM;

"(2) IF APPLICATION FOR WAIVER IS RECEIVED IN HIS OFFICE AFTER THE EXPIRATION OF THREE YEARS IMMEDIATELY FOLLOWING THE DATE ON WHICH THE ERRONEOUS PAYMENT OF PAY WAS DISCOVERED OR THREE YEARS IMMEDIATELY FOLLOWING OCTOBER 21, 1968, WHICHEVER IS LATER; OR

"(3) IF APPLICATION FOR WAIVER IS RECEIVED IN HIS OFFICE AFTER THE EXPIRATION OF THREE YEARS IMMEDIATELY FOLLOWING THE DATE ON WHICH THE ERRONEOUS PAYMENT OF ALLOWANCES WAS DISCOVERED OR THREE YEARS IMMEDIATELY FOLLOWING THE EFFECTIVE DATE OF THE AMENDMENT AUTHORIZING THE WAIVER OF ALLOWANCES, WHICHEVER IS LATER."

REGULATIONS GOVERNING THE STANDARDS FOR WAIVER OF CLAIMS FOR ERRONEOUS PAYMENT OF PAY AND ALLOWANCES HAVE BEEN PROMULGATED IN PART 91 OF 4 C.P.R. (1974). IN SUBSTANCE THE STATUTE AND REGULATIONS PERMIT THE WAIVER OF A CLAIM ARISING OUT OF AN ERRONEOUS PAYMENT OF PAY AND ALLOWANCES MADE TO AN EMPLOYEE THROUGH ADMINISTRATIVE ERROR OF WHICH HE WAS NOT KNOWLEDGEABLE AND COLLECTION ACTION UNDER THE CLAIM WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE AND NOT IN THE BEST INTERESTS OF THE UNITED STATES.

ONE EXAMPLE OF THE APPLICATION OF WAIVER PROVISIONS ARISES WHEN AN EMPLOYEE HAS USED LEAVE CREDITED TO HIS ACCOUNT IN ERROR.

"SEC. 6302. GENERAL PROVISIONS

"(F) AN EMPLOYEE WHO USES EXCESS ANNUAL LEAVE CREDITED BECAUSE OF ADMINISTRATIVE ERROR MAY ELECT TO REFUND THE AMOUNT RECEIVED FOR THE DAYS OF EXCESS LEAVE BY LUMP-SUM OR INSTALLMENT PAYMENTS OR TO HAVE THE EXCESS LEAVE CARRIED FORWARD AS A CHARGE AGAINST LATER-ACCRUING ANNUAL LEAVE, UNLESS REPAYMENT IS WAIVED UNDER SECTION 5584 OF THIS TITLE.

IN OTHER WORDS, SUCH LEAVE COULD BE CONVERTED TO A MONETARY AMOUNT AND FORM AN INDEBTEDNESS ON THE PART OF THE EMPLOYEE TO THE GOVERNMENT. THEN AN AGENCY MAY, UNDER THE CONDITIONS DESCRIBED ABOVE, GRANT A WAIVER TO THE EMPLOYEE FOR THE INDEBTEDNESS. B-166848, JUNE 3, 1969.

6. RESTORATION OF ANNUAL LEAVE LOST UNDER CERTAIN CIRCUMSTANCES

A NEW MAKE-WHOLE REMEDY WAS PROVIDED BY ENACTMENT OF PUB. L. 93-181 ON DECEMBER 14, 1973. NOW FOUND AT 5 U.S.C. SEC. 6304(D), SUPP. III (1973), IT PERMITS THE RESTORATION OF LEAVE TO AN EMPLOYEE THAT IS LOST, THROUGH NO FAULT OF HIS, BECAUSE OF ADMINISTRATIVE ERROR, EXIGENCIES OF PUBLIC BUSINESS, OR SICKNESS. SECTION 6304(D) PROVIDES AS FOLLOWS:

"SEC. 6304. ANNUAL LEAVE; ACCUMULATION

"(D)(1) ANNUAL LEAVE WHICH IS LOST BY OPERATION OF THIS SECTION BECAUSE OF -

"(A) ADMINISTRATIVE ERROR WHEN THE ERROR CAUSES A LOSS OF ANNUAL LEAVE OTHERWISE ACCRUABLE AFTER JUNE 30, 1960;

"(B) EXIGENCIES OF THE PUBLIC BUSINESS WHEN THE ANNUAL LEAVE WAS SCHEDULED IN ADVANCE; OR

"(C) SICKNESS OF THE EMPLOYEE WHEN THE ANNUAL LEAVE WAS SCHEDULED IN ADVANCE;

SHALL BE RESTORED TO THE EMPLOYEE.

"(2) ANNUAL LEAVE RESTORED UNDER PARAGRAPH (1) OF THIS SUBSECTION, OR UNDER CLAUSE (2) OF SECTION 5562(A) OF THIS TITLE, WHICH IS IN EXCESS OF THE MAXIMUM LEAVE ACCUMULATION PERMITTED BY LAW SHALL BE CREDITED TO A SEPARATE LEAVE ACCOUNT FOR THE EMPLOYEE AND SHALL BE AVAILABLE FOR USE BY THE EMPLOYEE WITHIN THE TIME LIMITS PRESCRIBED BY REGULATIONS OF THE CIVIL SERVICE COMMISSION. LEAVE CREDITED UNDER THIS PARAGRAPH BUT UNUSED AND STILL AVAILABLE TO THE EMPLOYEE UNDER THE REGULATIONS PRESCRIBED BY THE COMMISSION SHALL BE INCLUDED IN THE LUMP SUM PAYMENT UNDER SECTION 5551 OR 5552(1) OF THIS TITLE BUT MAY NOT BE RETAINED TO THE CREDIT OF THE EMPLOYEE UNDER SECTION 5552(2) OF THIS TITLE." THE CIVIL SERVICE COMMISSION HAS PROMULGATED REGULATIONS AND GUIDELINES FOR THE IMPLEMENTATION OF THE ABOVE-QUOTED STATUTE IN FEDERAL PERSONNEL MANUAL (FPM) LETTER NO. 630.22 DATED JANUARY 11, 1974. THE STATUTE AND REGULATIONS APPEAR TO PROVIDE AN ADEQUATE MAKE WHOLE REMEDY FOR AN EMPLOYEE WHO IS PREVENTED FROM TAKING ANNUAL LEAVE SCHEDULED IN ADVANCE BY REASON OF EXIGENCIES OF THE PUBLIC BUSINESS OR SICKNESS. HOWEVER, THE STATUTE AND REGULATIONS DO NOT APPEAR TO PROVIDE AN ADEQUATE MAKE-WHOLE REMEDY UNDER ALL CIRCUMSTANCES WHERE THE EMPLOYEE LOSES LEAVE AS A RESULT OF AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION BY THE AGENCY WHICH IS NOT TERMED "AN ADMINISTRATIVE ERROR." SEE TAB C.4 FOR DISCUSSION OF THIS PROBLEM.

7. MAKE-WHOLE REMEDIES FOR FOREIGN SERVICE EMPLOYEES

THE SECRETARY OF STATE HAS AUTHORITY UNDER 22 U.S.C. SEC. 993 (SUPP. III, 1973), TO TAKE CERTAIN REMEDIAL MEASURES TO CORRECT ERRONEOUS PERSONNEL ACTIONS AFFECTING FOREIGN SERVICE EMPLOYEES. 22 U.S.C. SEC. 993 READS AS FOLLOWS:

"SEC. 993. RECOMMENDATIONS FOR PROMOTION.

"(A) EVALUATION OF PERFORMANCE BY SELECTION BOARDS; RANK ORDER LISTS.

"THE SECRETARY SHALL ESTABLISH, WITH THE ADVICE OF THE BOARD OF THE FOREIGN SERVICE, SELECTION BOARDS TO EVALUATE THE PERFORMANCE OF FOREIGN SERVICE OFFICERS; AND UPON THE BASIS OF THEIR FINDINGS, WHICH, EXCEPT FOR CAREER AMBASSADORS AND CAREER MINISTERS, SHALL BE SUBMITTED TO THE SECRETARY IN RANK ORDER BY CLASS OR IN RANK ORDER BY SPECIALIZATION WITHIN A CLASS, THE SECRETARY SHALL MAKE RECOMMENDATIONS IN ACCORDANCE WITH THE FINDINGS TO THE PRESIDENT FOR THE PROMOTION OF FOREIGN SERVICE OFFICERS. NO PERSON ASSIGNED TO SERVE ON ANY SUCH BOARD SHALL SERVE IN SUCH CAPACITY FOR ANY TWO CONSECUTIVE YEARS. IN SPECIAL CIRCUMSTANCES, HOWEVER, WHICH SHALL BE SET FORTH BY REGULATIONS, THE SECRETARY SHALL HAVE THE AUTHORITY TO REMOVE INDIVIDUAL NAMES FROM THE RANK ORDER LIST SUBMITTED BY THE SELECTION BOARDS OR TO DELAY THE INCLUSION OF INDIVIDUAL NAMES UNTIL A SUBSEQUENT LIST OF NOMINATIONS IS TRANSMITTED TO THE PRESIDENT.

"(B) RECOMMENDATIONS OF GRIEVANCE BOARDS OR PANELS OR EQUAL EMPLOYMENT OPPORTUNITY APPEALS EXAMINERS.

THE SECRETARY MAY, PURSUANT TO A RECOMMENDATION OF A DULY CONSTITUTED GRIEVANCE BOARD OR PANEL OR AN EQUAL EMPLOYMENT OPPORTUNITY APPEALS EXAMINER -

"(1) RECOMMEND TO THE PRESIDENT THE PROMOTION OF A FOREIGN SERVICE OFFICER:

"(2) PROMOTE FOREIGN SERVICE STAFF PERSONNEL AND FOREIGN SERVICE RESERVE OFFICERS WITH LIMITED OR UNLIMITED TENURE; AND

"(3) GRANT TO FOREIGN SERVICE PERSONNEL ADDITIONAL STEP INCREASES IN SALARY, WITHIN THE SALARY RANGE ESTABLISHED FOR THE CLASS IN WHICH AN OFFICER OR EMPLOYEE IS SERVING.

"(C) RETROACTIVE PROMOTIONS; ADDITIONAL INCREASES IN SALARY.

THE SECRETARY MAY, IN SPECIAL CIRCUMSTANCES WHICH SHALL BE SET FORTH IN REGULATIONS, MAKE RETROACTIVE PROMOTIONS AND ADDITIONAL INCREASES IN SALARY WITHIN CLASS MADE OR GRANTED UNDER THE AUTHORITY OF THIS SECTION."

THE ABOVE-QUOTED STATUTE AUTHORIZES THE SECRETARY OF STATE TO REMEDY IMPROPER PERSONNEL ACTIONS AFFECTING FOREIGN SERVICE EMPLOYEES THROUGH THE IMPLEMENTATION OF RECOMMENDATIONS OF CERTAIN FACT-FINDING AUTHORITIES AND BY GRANTING RETROACTIVE PROMOTIONS AND ADDITIONAL INCREASES OF SALARY IN SPECIAL CIRCUMSTANCES. THIS AUTHORITY IS IN ADDITION TO OTHER MAKE-WHOLE REMEDIES SUCH AS THE BACK PAY STATUTE, 5 U.S.C. SEC. 5596.

GAPS IN EXISTING LAW AND REGULATIONS THAT PRECLUDE AN EMPLOYEE FROM BEING MADE ENTIRELY WHOLE

THERE ARE A FEW RESPECTS IN WHICH EXISTING LAW AND REGULATIONS DO NOT FULLY COMPENSATE AN EMPLOYEE WHO HAS UNDERGONE AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION SO AS TO PUT HIM IN THE SAME FINANCIAL POSITION HE WOULD HAVE BEEN IN HAD THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION NOT OCCURRED. IN MOST INSTANCES, WE BELIEVE LEGISLATIVE ACTION WILL BE NECESSARY TO AUTHORIZE THE APPROPRIATE REMEDY. WE TAKE NO POSITION AT THE PRESENT TIME AS TO WHETHER THESE REMEDIES ARE DESIRABLE, HOWEVER; THEY ARE MERELY PRESENTED FOR YOUR CONSIDERATION.

1. ATTORNEY FEES AND OTHER LITIGATION EXPENSES

DESPITE THE FACT THAT AN EMPLOYEE MAY EXPEND LARGE SUMS OF MONEY IN OBTAINING A REMEDY FOR AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION, THESE EXPENSES ARE FOR THE MOST PART NOT RECOVERABLE.

IT IS A GENERAL PRINCIPLE OF LAW THAT IN THE ABSENCE OF ANY CONTRACTUAL OR STATUTORY LIABILITY THEREFOR, ATTORNEYS' FEES AND EXPENSES OF LITIGATION INCURRED BY A PLAINTIFF OR WHICH A PLAINTIFF IS OBLIGATED TO PAY IN THE LITIGATION OF HIS CLAIM, ARE NOT RECOVERABLE AS AN ITEM OF DAMAGES, EITHER IN A CONTRACT OR A TORT ACTION. THIS IS THE CASE WHETHER THE ACTION IS AGAINST A PRIVATE INDIVIDUAL OR CORPORATION, OR AGAINST THE UNITED STATES GOVERNMENT. STEWART V. SONNEBORN, 98 U.S. 187 (1878); HAUENSTEIN V. LYNHAM, 100 U.S. 483 (1880); PIGGLY WIGGLY V. UNITED STATES, 112 CT. CL. 391, 432 (1949); EDELMAN V. UNITED STATES, 117 CT. CL. 400, 413 (1950); 49 COMP. GEN. 44 (1969).

ACCORDINGLY, AN EMPLOYEE WHO IS FORCED TO EMPLOY AN ATTORNEY AND INCUR LITIGATION EXPENSES TO REMEDY AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION IS CURRENTLY UNABLE TO RECOVER THESE COSTS IF HE IS SUCCESSFUL IN OBTAINING HIS REMEDY, AND TO THIS EXTENT HE IS NOT MADE WHOLE AND PUT BACK IN THE POSITION HE OCCUPIED BEFORE THE IMPROPER ACTION OCCURRED. ON THE OTHER HAND, SINCE ATTORNEYS' FEES AND LITIGATION EXPENSES ARE NOT GENERALLY RECOVERABLE IN OTHER ROUTINE CIVIL ACTIONS, IT COULD BE ARGUED THAT THERE IS NO REASON TO TREAT THE PLAINTIFF IN A BACK PAY CASE DIFFERENTLY BECAUSE THE UNITED STATES GOVERNMENT IS THE DEFENDANT.

2. INTEREST ON BACK PAY

OFTEN MANY YEARS GO BY AFTER AN EMPLOYEE UNDERGOES AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION BEFORE HIS RIGHT TO COMPENSATION IS ESTABLISHED AND HE ACTUALLY RECEIVES HIS BACK PAY. SOMETIMES LARGE SUMS OF MONEY ARE INVOLVED WHICH MAY CONSIST OF AN EMPLOYEE'S PAY, ALLOWANCES AND DIFFERENTIALS FOR A NUMBER OF YEARS, AMOUNTING TO AS MUCH AS $100,000 OR MORE. DELAY IN RECEIPT OF SUCH MONEY DEPRIVES THE EMPLOYEE OF INVESTMENT OPPORTUNITIES TO MAKE HIS CAPITAL GROW. HOWEVER, THE GENERAL RULE OF LAW IS THAT IN THE ABSENCE OF A CONTRACT OR A STATUTE EXPRESSING A CONTRARY INTENTION, INTEREST DOES NOT RUN UPON CLAIMS AGAINST THE GOVERNMENT. SEABOARD AIR LINE RAILWAY V. UNITED STATES, 261 U.S. 299, 304 (1923); SMYTH V. UNITED STATES, 302 U.S. 329, 353 (1937); 45 COMP. GEN. 169 (1965).

INASMUCH AS THE BACK PAY STATUTE DOES NOT SPECIFICALLY PROVIDE FOR THE PAYMENT OF INTEREST, NO INTEREST MAY BE PAID ON ANY BACK PAY ALLOWANCES AND DIFFERENTIALS RECOVERED BY AN EMPLOYEE. IF IT IS DESIRED TO MAKE THE EMPLOYEE WHOLE WITH REGARD TO INTEREST ON HIS CLAIM, THEN IT WOULD BE NECESSARY TO AMEND THE BACK PAY STATUTE, 5 U.S.C. SEC. 5596, SUPRA, TO AUTHORIZE THE PAYMENT OF INTEREST ON THE CLAIM.

3. CONSEQUENTIAL DAMAGES

PRESENTLY THE BACK PAY ACT OF 1966, 5 U.S.C. SEC. 5596, SUPRA, AND IMPLEMENTING REGULATIONS, AUTHORIZE RECOMPENSE ONLY FOR ACTUAL DAMAGES RESULTING DIRECTLY FROM THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION. THESE DAMAGES ARE EQUIVALENT TO THE EXACT AMOUNT OF PAY, ALLOWANCES, OR DIFFERENTIALS THE EMPLOYEE WOULD HAVE RECEIVED AS A RIGHT HAD THE UNJUSTIFIED OR UNWARRANTED ACTION NOT OCCURRED. OTHER LOSSES THAT ARE INCIDENT TO AND OCCASIONED BY THE UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION ARE NOT COMPENSABLE. FOR EXAMPLE, AN EMPLOYEE WHO IS REMOVED MAY FIND IT IMPOSSIBLE TO CONTINUE MAKING HIS HOUSE AND CAR PAYMENTS. THE LOSS OF HIS EQUITY IN HIS CAR OR HOUSE THROUGH REPOSSESSION OR FORECLOSURE ACTIONS CANNOT BE REMEDIED UNDER THE PRESENT LAW AND AN AMENDMENT OF THE BACK PAY ACT WOULD BE REQUIRED TO AUTHORIZE COMPENSATION FOR SUCH LOSSES. MOREOVER, THERE IS NO WAY TO MAKE HIM WHOLE FOR LOST PROMOTION OR TRAINING OPPORTUNITIES, IN THE ABSENCE OF A SHOWING THAT SUCH OPPORTUNITIES WOULD DEFINITELY HAVE BEEN GIVEN TO HIM HAD THE WRONGFUL ACTION NOT TAKEN PLACE. FINALLY, IN THE ABSENCE OF A COURT TEST, THERE IS NO CLEAR AUTHORITY TO AWARD RECOMPENSE FOR SUCH DAMAGES AS THE LOSS OF PROFESSIONAL REPUTATION AND STANDING.

4.RESTORATION OF ANNUAL LEAVE TO EMPLOYEE REINSTATED UNDER THE BACK PAY ACT

UNDER TAB B.6, WE DISCUSSED THE PROVISIONS OF PUB. L. 93-181, 5 U.S.C. SEC. 6304(D) (SUPP. III, 1973), AND THE CSC IMPLEMENTING REGULATIONS IN FPM LETTER NO. 630-22, DATED JANUARY 11, 1974. WE NOTED THAT WHEN AN EMPLOYEE WHO HAD PLANNED IN ADVANCE TO TAKE ANNUAL LEAVE WHICH, IF NOT TAKEN, WOULD BE FORFEITED BECAUSE IT WAS IN EXCESS OF THE MAXIMUM LEAVE ACCUMULATION PERMITTED BY LAW, WAS PREVENTED FROM TAKING IT THROUGH NO FAULT OF HIS OWN, BUT RATHER BECAUSE OF (1) THE EXIGENCIES OF PUBLIC BUSINESS, (2) SICKNESS OF THE EMPLOYEE, OR (3) ADMINISTRATIVE ERROR, THAT LEAVE CAN BE CREDITED TO A SPECIAL LEAVE ACCOUNT AND SAVED FOR LATER USE WITHIN CERTAIN SPECIFIED TIME LIMITS. THE PROBLEM CENTERS ON AN EMPLOYEE WHO CLAIMS RESTORATION OF LEAVE UNDER THE THIRD CONDITION MENTIONED - "ADMINISTRATIVE ERROR."

IF AN EMPLOYEE USED LESS LEAVE THAN HE WAS ENTITLED TO BECAUSE HIS AGENCY MISTAKENLY ASSIGNED HIM TO A LOWER LEAVE-EARNING CATEGORY - E.G., 4 HOURS PER PAY PERIOD INSTEAD OF 6 HOURS) - AND AS A RESULT, HIS LEAVE BALANCE EXCEEDS THE USUAL 30-DAY CARRYOVER LIMITATION AT THE END OF THE LEAVE YEAR, IT IS NOT TOO DIFFICULT TO INVOKE THE ABOVE-CITED STATUTE TO PROTECT HIS LEAVE FROM FORFEITURE SINCE CLEARLY AN "ADMINISTRATIVE ERROR" HAD OCCURRED. BUT WHAT IF THE EMPLOYEE ACCRUED ANNUAL LEAVE HE HAD NO OPPORTUNITY TO USE BECAUSE HE WAS WRONGFULLY SEPARATED OR SUSPENDED? UNDER THE BACK PAY ACT, SUCH A WRONGFUL SEPARATION OR SUSPENSION WOULD BE REGARDED AS AN "UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION," AND UPON REINSTATEMENT TO DUTY, THE EMPLOYEE WOULD BE AWARDED NOT ONLY HIS BACK PAY BUT ALSO ANY LEAVE HE WOULD OTHERWISE HAVE ACCRUED. HOWEVER, IF THAT ACCRUED LEAVE EXCEEDS LEGAL CARRY-OVER LIMIT, THE EXCESS WOULD BE FORFEITED. THE INCOMPLETE REMEDY IN THIS SITUATION RESULTS FROM THE FOLLOWING STATEMENT REGARDING "ADMINISTRATIVE ERROR" WHICH APPEARS ON PAGE 3 OF THE ATTACHMENT TO THE CITED FPM LETTER:

"(3) SECTION 5596 OF TITLE 5 PROVIDES THE BASIC GUIDELINES FOR DETERMINING ENTITLEMENT TO PAY, ALLOWANCES, AND BENEFITS IN THE EVENT AN EMPLOYEE IS FOUND TO HAVE UNDERGONE AN UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION. THIS SECTION PROVIDES THAT ANNUAL LEAVE IS TO BE RESTORED UP TO THE MAXIMUM AMOUNT PERMITTED BY THE LEAVE SYSTEM UNDER WHICH THE EMPLOYEE IS COVERED. FOR PURPOSES OF PUBLIC LAW 93-181, (5 U.S.C. SEC. 6304(D)) UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTIONS ARE NOT CONSIDERED TO BE ADMINISTRATIVE ERRORS. THUS, AN EMPLOYEE, UNDER SECTION 5596, IS NOT ENTITLED TO EXCEED THE NORMAL MAXIMUM AMOUNT OF ANNUAL LEAVE PERMITTED UNDER THE APPROPRIATE LEAVE SYSTEM."

WE BELIEVE THAT THERE IS NO SUBSTANTIVE DIFFERENCE BETWEEN THE USE OF THE TWO TERMS "ADMINISTRATIVE ERROR" AND "UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTION" IN THIS CONTEXT AND THAT A REGULATORY CHANGE THAT PERMITTED APPLICATION OF PUB. L. 93-181 TO "UNJUSTIFIED OR UNWARRANTED PERSONNEL ACTIONS" WOULD BE CONSISTENT WITH CONGRESSIONAL INTENT. HOWEVER, THE CSC POINTS TO THE DELIBERATE USE OF THE WORDS "ADMINISTRATIVE ERROR" IN THE STATUTE AND SUGGESTS THAT THE RESTRICTION MAY HAVE BEEN INTENTIONAL. THAT CASE, IT WOULD REQUIRE NEW LEGISLATION TO AMEND THIS STATUTE SO THAT REMEDIAL MEASURES WOULD BE AVAILABLE FOR THIS CLASS OF ERRONEOUS PERSONNEL ACTIONS.

IT SHOULD BE POINTED OUT THAT THE PROVISIONS OF 5 U.S.C. SEC. 6304(D)(1)(A) AUTHORIZE THE RESTORATION OF LOST LEAVE RETROACTIVELY TO JUNE 30, 1960, WHICH WOULD, IF CONSTRUED TO COVER UNJUSTIFIED AND UNWARRANTED PERSONNEL ACTIONS, ALLOW A GREAT NUMBER OF PERSONS WHO HAVE UNDERGONE SUCH ACTIONS, TO RECREDIT LEAVE OR OBTAIN LUMP-SUM LEAVE PAYMENTS AS IS AUTHORIZED BY THE LAW. IN THIS CONNECTION WE HAVE NO INFORMATION AS TO HOW MANY PERSONS WOULD BE INVOLVED IF SUCH A CHANGE WERE MADE.

5. RECOMPENSE FOR DISCRIMINATION IN HIRING ON NON-EEO GROUNDS

IT IS A GENERAL PRINCIPLE OF LAW THAT THE SALARY AND OTHER ENTITLEMENTS OF A GOVERNMENT JOB ARE INCIDENT TO AND ATTACHED TO THE JOB. THEY ARE THUS A PART OF THE JOB AND GO WITH IT. CONSEQUENTLY, THE SALARY AND OTHER ENTITLEMENTS ARE PAYABLE ONLY TO THE PERSON APPOINTED TO THE JOB, AND A GOVERNMENT EMPLOYEE IS ENTITLED ONLY TO THE SALARY AND OTHER BENEFITS OF THE POSITION TO WHICH HE HAS BEEN APPOINTED. SEE BORAK V. UNITED STATES, 78 F. SUPP. 123 (CT. CL. 1948, CERT. DENIED), 335 U.S. 821; PRICE V. UNITED STATES, 80 F. SUPP. 542 (CT. CL. 1948); GANSE V. UNITED STATES, 376 F.2D 900 (CT. CL. 1967). IF AN APPLICANT FOR EMPLOYMENT IS NOT SELECTED ON THE BASIS OF DISCRIMINATION BECAUSE OF HIS RACE, COLOR, RELIGION, SEX, OR NATIONAL ORIGIN, AN EXCEPTION IS MADE AND THE AGENCY MAY BE ORDERED TO HIRE HIM UNDER THE PROVISIONS OF THE EEOA. (SEE DISCUSSION UNDER TAB B.3.) HOWEVER, IF HE IS NOT SELECTED ON SOME EQUALLY UNJUSTIFIED OR UNWARRANTED NON-EEO GROUND, AND THEREFORE NEVER APPOINTED, HE HAS NOT SUFFERED A DIMUNITION OF PAY OR OTHER ENTITLEMENTS SO AS TO COME WITHIN THE PURVIEW OF ANY MAKE-WHOLE LEGISLATION SUCH AS THE BACK PAY STATUTE, 5 U.S.C. SEC. 5596.

ACCORDINGLY, IF CORRECTIVE ACTION FOR THIS MAKE-WHOLE GAP IS DEEMED DESIRABLE, THE BACK PAY STATUTE WOULD HAVE TO BE AMENDED TO ALSO COVER APPLICANTS FOR EMPLOYMENT AS WELL AS EMPLOYEES.

6. REIMBURSEMENT TO RESTORED EMPLOYEE FOR COMMERCIAL HEALTH INSURANCE

5 U.S.C. SEC. 8908 (1970) PROVIDES AUTHORITY TO RESTORE HEALTH INSURANCE BENEFITS TO EMPLOYEES WHO WERE IMPROPERLY REMOVED OR SUSPENDED FROM GOVERNMENT EMPLOYMENT, FOLLOWING REINSTATEMENT UNDER THE BACK PAY ACT. (SEE DISCUSSION AT TAB B.1.) HOWEVER, THE STATUTE OFFERS THE EMPLOYEE ONLY THE OPTION OF ENROLLING AS THOUGH HE WERE A NEW EMPLOYEE IN ONE OF THE GOVERNMENT HEALTH PLANS PROVIDED "UNDER THIS CHAPTER," IN WHICH CASE HIS PAYMENTS DURING THE PERIOD OF HIS REMOVAL ARE WAIVED BUT HE CANNOT CLAIM ANY BENEFITS FOR THE PERIOD IN QUESTION, OR HE MAY CHOOSE TO BE CONSIDERED AS RETROACTIVELY RESTORED TO COVERAGE, IN WHICH CASE HE MUST MAKE THE REQUIRED CONTRIBUTIONS FOR THE PERIOD OF HIS REMOVAL BUT MAY ALSO FILE ANY CLAIMS HE MAY HAVE FOR THE SAME PERIOD. IT MAY BE ASKED WHETHER THE GOVERNMENT'S "MAKE-WHOLE" OBLIGATION IS FULLY MET BY CONFINING THE REMEDY TO RESTORATION OF BENEFITS UNDER ONE OF ITS OWN HEALTH INSURANCE PLANS. MANY YEARS MAY ELAPSE BEFORE AN EMPLOYEE HAS BEEN VINDICATED AFTER AN UNLAWFUL REMOVAL FROM GOVERNMENT SERVICE AND REINSTATED. QUITE POSSIBLY HE IS READY TO RETIRE BY THAT TIME. IN ANY CASE, IT IS NOT UNREASONABLE TO EXPECT THAT DURING THESE INTERVENING YEARS, A PRUDENT INDIVIDUAL WOULD PURCHASE ALTERNATIVE HEALTH INSURANCE ON THE COMMERCIAL MARKET, AT CONSIDERABLE FINANCIAL COST. IT IS NOT MUCH HELP TO OFFER HIM REINSTATEMENT IN A GOVERNMENT HEALTH INSURANCE PLAN IF HE IS CLOSE TO RETIREMENT.

TO MAKE HIM TRULY WHOLE FINANCIALLY, A LEGISLATIVE AMENDMENT TO 5 U.S.C. SEC. 8903 WOULD BE NECESSARY, OFFERING, AS A THIRD OPTION OR IN ADDITION TO OPTION C WHICH PERMITS ENROLLMENT AS A NEW EMPLOYEE, REIMBURSEMENT FOR THE PORTION OF HIS PREMIUMS FOR COMMERCIAL HEALTH INSURANCE EQUAL TO THE CONTRIBUTION NORMALLY MADE FOR ITS EMPLOYEES BY THE FEDERAL GOVERNMENT.