Those Pesky Background Checks Can Lead to Removal

Can an employee fired during a probationary period file an appeal with the MSPB if she is fired as a result of information uncovered during a background check? The MSPB said “no” and this case involving an IRS employee went to federal court.

A Revenue Officer terminated by the Internal Revenue Service during her probationary period had no luck when she took her case to the Merit Systems Protection Board and then the Federal Circuit Court of Appeals. (Alvarez v. Department of the Treasury, C.A.F.C. No. 2008-3264 (nonprecedential), 11/6/08)

After hiring Alvarez the agency did a routine background check. It uncovered that in prior employment as a Tax Examiner with the State of Maine, Alvarez had been disciplined for “inappropriately accessing” tax information. (Opinion p. 2) The IRS terminated Alvarez during her probationary period for “conduct unbecoming or not suitable for IRS employment.” (p. 2)

The Merit Systems Protection Board held a hearing that resulted in a finding that the Board did not have jurisdiction over her appeal. In cases involving pre-appointment conduct, the only role of the MSPB is to ensure that certain required procedural requirements were followed (advance written notice of reasons, reasonable time to respond, and notice of the final decision with appeal rights.) The Administrative Judge determined that the required procedures were followed by the agency and dismissed Alvarez’ appeal. (p. 4)

One of the points argued in the case was the adequacy of the amount of time Alvarez was given to respond to the notice. The agency gave her seven days, but by the time she got a copy of the background investigation report she had four days left. The AJ did not address whether four days was enough time, but concluded that Alvarez was not prejudiced when the agency refused to grant an extension—she filed a “thorough response” and did not show that she was prejudiced by the amount of time allowed to respond. (pp. 4-5) The court deferred to the AJ’s determination since Alvarez did not make a “persuasive showing” that the AJ erred in this regard. (p. 5)

Alvarez also unsuccessfully argued that her termination was actually an adverse suitability determination that is appealable to the Board, calling it a “constructive suitability determination.” She pointed among other things to the reason given for her termination, which used the word “suitability.” (p. 5)

The Board and the court did not buy this argument, pointing out that the request to terminate Alvarez and the notice of proposed termination both cited the regulations governing probationary separations. (pp. 5-6) In short, the court has now upheld Alvarez’ removal.

About the Author

Susan McGuire Smith spent most of her federal legal career with NASA, serving as Chief Counsel at Marshall Space Flight Center for 14 years. Her expertise is in government contracts, ethics, and personnel law.