U.S. MERIT SYSTEMS PROTECTION BOARD LATHAM et al. v. U.S. POSTAL SERVICE ORAL ARGUMENTS Washington, D.C. Tuesday, December 13, 2011 2 1 PARTICIPANTS: 2 For Merit System Protection Board: 3 SUSAN TSUI GRUNDMANN, Chairman 4 ANNE M. WAGNER, Vice Chairman 5 MARY M. ROSE, Member 6 For Appellants: 7 MATTHEW DOWD 8 For National Association of Letter Carriers: 9 KEITH SECULAR 10 For American Postal Workers Union: 11 DARRYL ANDERSON 12 For US Postal Service: 13 WILLIAM BUBB 14 15 16 17 * * * * * 18 19 20 21 22 23 24 25 3 1 P R O C E E D I N G S 2 (10:03 a.m.) 3 CHAIRMAN GRUNDMANN: Good morning. We're on the 4 record. 5 On November 21, 2011, the U.S. Merit Systems 6 Protection Board granted the U.S. Postal Service's motion 7 for oral argument in five consolidated cases. The Board 8 will now hear oral argument in the following cases, please 9 bear with me. 10 Latham v. U.S. Postal Service, MSPB docket numbers 11 DA-353-10-408-I-1; Turner v. USPS, SF-353-10-329-I-1; Reaves 12 v. USPS, CH-353-10-823-I-1; Lundy v. USPS, 13 AT-353-11-369-I-1; and Albright v. USPS, DC-752-11-196-I-1. 14 The hearing is conducted pursuant to 5-CFR-1201- 15 1117-A-2. Here today is the full Board of the MSPB: The 16 vice chair, Anne Wagner; the member, Mrs. Mary Rose; and 17 myself, Susan Tsui Grundmann, chairman, presiding. 18 The parties are represented by counsel. The 19 Office of Personnel Management, having submitted an advisory 20 opinion in these cases, has declined the right to 21 participate in the oral argument. The Board will now hear 22 from Mr. Dowd representing all five counts. 23 Good morning, Mr. Dowd. 24 MR. DOWD: Good morning. Chairman Grundmann, vice 25 Chairman Wagner, Member Rose, good morning. And may it 4 1 please the Board, thank you for the time today. And before 2 I get into the merits, I would like to just say for the 3 record, it is an honor and a privilege for me to represent 4 these five employees of the Postal Service. This is Ms. 5 Albright, Ms. Lundy, Ms. Reaves, Ms. Turner, and Mr. Latham. 6 Together they represent about 120 years of loyal service to 7 the Postal Service. 8 With that being said, I'd like to focus on the 9 issues before the Board today. In each of the five cases, 10 the administrative judge erred because the national 11 reassessment process, on its face, is arbitrary and 12 capricious. That's so because the NRP violates the Postal 13 Service's longstanding internal guidelines and regulations 14 that govern the restoration of partially recovered Postal 15 Service employees. 16 VICE CHAIRMAN WAGNER: Mr. Dowd, I'm sorry to 17 interrupt or to jump right in here so early, but did the 18 Postal Service negotiate the NRP policy or implementation 19 with the various unions that represent postal workers? 20 MR. DOWD: Based on the record that I've seen, I'm 21 not certain that is the case. I don't believe that the NRP 22 has been negotiated with these five individuals. I'm almost 23 certain of that. But my understanding of the NRP is that it 24 almost announced a unilateral decision by the Postal Service 25 to modify and change the status of these five individuals 5 1 who were restored under the Postal Service's longstanding 2 guidelines and rules that govern partially recovered 3 employees. 4 CHAIRMAN GRUNDMANN: But the question is not 5 necessarily about the NRP itself. The question is about the 6 Agency's rules and whether we have the jurisdiction to hear 7 cases like this. 8 MR. DOWD: Yes, Chairman Grundmann, that's 9 correct. And the question is jurisdiction and the 10 jurisdiction for the Board is set under 5 CFR 353.301C, 11 353.301D, and 353.304C. Both of those work together and 12 there the issue is whether the Postal Service's actions are 13 arbitrary and capricious. 14 CHAIRMAN GRUNDMANN: Well, what about the agency's 15 argument that the statute really only applies to fully 16 recovered or those who have overcome their disability, and 17 to be restored to a full or a whole position. 18 MR. DOWD: Well, Chairman -- 19 CHAIRMAN GRUNDMANN: And generally we don't have 20 jurisdiction. 21 MR. DOWD: Chairman Grundmann, that is, in my 22 opinion, a completely separate issue. What the Board did in 23 its announcement in the federal regulations is presenting 24 two issues for consideration by the five appellants in the 25 parties here. None of those considerations -- neither of 6 1 those issues addressed the authority of OPM to promulgate 2 the rules in 353. 3 What the Postal Service has done here is sort of 4 tried to shift the focus of what's being discussed today. 5 And it you read the Postal Service's brief carefully -- and 6 I think even a generous reading of the Postal Service's 7 brief in these cases -- they never ever dispute the fact 8 that the NRP is inconsistent with their rules and 9 regulations that have been in place for 30 years. What 10 they've tried to do is present a new issue to the Board and 11 what they presented is an issue that has not been raised in 12 any of the five cases before the administrative judge. And 13 -- 14 VICE CHAIRMAN WAGNER: So are you suggesting we 15 shouldn't consider it all based on the fact that it wasn't 16 raised before? 17 MR. DOWD: I think that's the strongest point, 18 Vice Chairman Wagner, because under this court's precedent 19 in banks, this Board requires parties to raise issues before 20 the administrative judge before the Board itself -- the full 21 Board -- will consider it. And I don't think there's any 22 question that that issue has been presented. And it's even 23 more telling than the fact that the Board -- and I'm not 24 saying that there's anything wrong with this, but when the 25 Board issued the order explaining the procedure of the oral 7 1 argument here today, what the Board had to do is add those 2 two issues. And so those are now presented as issues 3 and 3 4 in terms of the authority of OPM to promulgate those 4 rules. 5 And so that's just one -- that's just the main 6 point about the -- 7 VICE CHAIRMAN WAGNER: But the point about -- can 8 I -- but if the Postal Service raised those arguments as a 9 result of our having requested OPM for an advisory opinion 10 with regard to an interpretation of its regulations, I mean 11 -- 12 MR. DOWD: Yes. 13 VICE CHAIRMAN WAGNER: -- I think it could be 14 argued that that issue was interjected by the Board. So why 15 shouldn't we consider it as a matter that's been properly 16 raised before us? 17 CHAIRMAN GRUNDMANN: State it another way. If we 18 don't have jurisdiction to hear this case, we don't have 19 jurisdiction. The Board's jurisdiction is not plenary. 20 VICE CHAIRMAN WAGNER: Well, no -- 21 MR. DOWD: Yeah, I think those are two questions. 22 Let me address Vice Chairman Wagner's question first, if I 23 may. In terms of it being implicitly raised in the question 24 presented to OPM, I don't think that's even a question 25 because if you look at OPM's response and you look at the 8 1 question presented to OPM, the only question presented was 2 the interpretation of 353 and the scope of 353. And in 3 their response, what does OPM focus on? OPM focuses on the 4 Supreme Court's longstanding precedent in multiple cases -- 5 Vitarelli v. Seaton, the Service v. Dulles, these and 6 multiple cases -- that say that the agency, even if not 7 bound by statute or regulation, if that agency promulgates 8 stricter regulation, the agency has to follow it. 9 And that's what OPM addressed in their letter in 10 response to the Board. OPM did not address the authority 11 under 8151 to promulgate the rule. And that's a completely 12 different issue. And, in fact, there's a D.C. Circuit case, 13 Railway Labor Executives Association, from 1994, that 14 explains that those two issues are distinct. 15 Now, I think that's a very strong case where the 16 Postal Service has waived that argument. They never 17 presented it below and it's -- you know, I'll admit that it 18 could be a complex issue, and I'm happy to discuss the 19 merits of that as well today. But the point here is that no 20 administrative judge has addressed this specific question of 21 whether OPM has the authority to promulgate that rule? In 22 fact, the Postal Service in its brief, at page 7, complains 23 that OPM doesn't address it. OPM doesn't address it because 24 the question wasn't presented. And I think it's really 25 telling in the fact that the only party here today that has 9 1 addressed the question, the ultra vires question, is the 2 Postal Service. 3 Neither of the amicus briefs have addressed it. 4 None of the parties have addressed it and they haven't, 5 quite simply, because it wasn't raised. 6 CHAIRMAN GRUNDMANN: Are you saying that we cannot 7 raise it sua sponte? 8 MR. DOWD: I think that would be unwise at this 9 point. I'm not saying that it's probably not within the 10 power of the Board, but given the, you know, issues that 11 were fairly presented and the time span on this case, if the 12 Postal Service wants to take up that fight, there are 13 probably plenty of other cases that the Postal Service can 14 do. 15 I'm also happy to address that -- 16 CHAIRMAN GRUNDMANN: Please do. 17 MR. DOWD: -- the substance of it, right? Well, 18 the second point I would argue that the Postal Service is 19 judicially stopped. They've adopted affirmatively in a 20 number of the cases below the fact that 8151 gives OPM the 21 authority to promulgate the rules at 353. 22 Another point -- 23 CHAIRMAN GRUNDMANN: In other words, they haven't 24 raised it before in any other forum. 25 MR. DOWD: It's slightly different. It's not only 10 1 that they haven't raised it, but in their briefs to the AJs 2 they have actually stated that 8151 is the source of 3 authority for 353. So it's related, but a little different. 4 The other thing I would say is that what the 5 Postal Service tries to do in terms of the 6 authority/promulgate the rule issue is that it looks at the 7 statute and, without citing a single case in the six pages 8 of the brief, they just go on and on and say this is what 9 the text means. But in my view, the text isn't that clear. 10 It never defines what is meant by "overcome." And when you 11 look at the history of 8151 -- and this is also set out in 12 the Postal Service's brief, but they don't really -- think 13 they try to slide by it -- is that prior to 8151 being 14 adopted in 1974, it's pretty clear that employees didn't 15 have to recover 100 percent to be restored to a position. 16 If you look at the legislative history of FECA, 17 there are two explicit statements in the legislative history 18 that address this issue. And Congress explicitly said that 19 the goal and the intention of FECA was to cover partially 20 recovered employees. There's no question about that, and 21 the Postal Service adopts that. 22 VICE CHAIRMAN WAGNER: But it is true that that 23 clear statement occurs in the legislative history and the 24 language of the statute, on its face, doesn't appear to 25 address partially recovered individuals at all. Isn't that 11 1 -- at least in 1974. 2 MR. DOWD: Yeah, and I'll adopt that and I think 3 that's a fair reading of the statute. And because the 4 statute doesn't directly address the issue, under Chevron, 5 what the courts and the Board -- I think the proper way to 6 look at the statute is you look at the agency that has the 7 authority to administer the statute. 8151B explicitly says 8 that OPM has the authority to administer the statute, so OPM 9 gets Chevron deference in terms of interpreting the statute. 10 VICE CHAIRMAN WAGNER: They only get to Chevron 11 deference if the statute is unclear. 12 MR. DOWD: If the statute is unclear or is silent 13 on the issue. And the statute is silent, in terms of the 14 complete definition of "overcome." And when you look at the 15 legislative history, when you look at the 30 years that OPM 16 and the Postal Service itself has interpreted the statute, 17 and if you look at how other Circuits have interpreted this 18 statute, it's pretty clear that up until August 24, 2011, 19 when the Postal Service submitted its brief to the Board, 20 everyone had the understanding that 8151 in FECA covered 21 partially recovered employees. 22 CHAIRMAN GRUNDMANN: So your argument is that the 23 ambiguity is in "overcome." Are there any other terms in 24 FECA that you deem ambiguous? 25 MR. DOWD: I think if you look at "overcome" and I 12 1 think if you look at -- let me just pull it up. If you look 2 at "overcome" and you look at it read in the context of 3 "suitable position," so it's the same or suitable position. 4 I think if you look at those terms holistically, you have to 5 understand that Congress did not speak directly in the text 6 of the statute with respect to fully recovered. 7 CHAIRMAN GRUNDMANN: What about equivalent 8 positions? 9 MR. DOWD: Pardon me? 10 CHAIRMAN GRUNDMANN: What about equivalent 11 positions? 12 MR. DOWD: Equivalent positions, I would agree 13 with that as well, too. I mean, there's no definition of 14 equivalent positions in the statute. And so, there's the 15 question on the Chevron, you know? Is that term defined or 16 is it clear on its face? And I'd submit to the Board that 17 it's not and you have to look at the context of FECA, the 18 legislative history and the longstanding of both OPM, the 19 Postal Service, and the courts. 20 VICE CHAIRMAN WAGNER: If you look at the language 21 in B-1 and B-2, you mention the ambiguity in the word 22 "overcome" -- 23 MR. DOWD: Yep. 24 VICE CHAIRMAN WAGNER: -- but to me, it actually 25 comes before that, which is in B-1. You have, "where the 13 1 injury of disability has been overcome." And then in B-2, 2 "if the injury or disability is overcome." Is there 3 anything to be made of this different usage of tense that 4 Congress employed here? I mean, can we read into -- if 5 we're going to read into the statute at all, could we read 6 into the "is overcome" a concept of, you know, an ongoing 7 process of overcoming, as opposed -- which would encompass 8 the partially recovered individuals? 9 MR. DOWD: Vice Chairman Wagner, I think that's a 10 perfectly reasonable interpretation of the statute. And the 11 ultimate question on this Chevron is whether the agency's 12 interpretation is reasonable. I mean, any ambiguity -- I'm 13 not going to come up here and advocate that this is a 14 crystal clear statute, right? It wasn't because it was all 15 drafted as a short statute. And when you think about all of 16 what goes on in the federal government in terms of restoring 17 injured employees within these, you know, two paragraphs, 18 this statutory text, there is no way that 8151 can be viewed 19 as covering every possible scenario. 20 And I think that's precisely why Congress wrote 21 that in 8151 B-2, "under regulations issued by the Office of 22 Personal Management." Congress intended for OPM to fill in 23 the gaps and that's exactly what OPM has done over the past 24 35 years. 25 VICE CHAIRMAN WAGNER: But the problem is in part 14 1 due to the fact that this 1966 of FECA did, arguably, 2 plainly encompass in the language of the statute itself the 3 partially recovered individuals. And so the 1974 4 amendments, in terms of -- you know, you talk about 5 ambiguity and silence, I mean, one could argue, and I'm sure 6 the Postal Service will and has -- that the fact that the 7 1974 amendments do not specifically address partially 8 recovered individuals is to indicate congressional intent to 9 actually exclude them from coverage of the statute. What do 10 you say to that? 11 MR. DOWD: Well, I think that that's just an 12 improper reading because what you're doing there is 13 inferring congressional intent based on silence in the 14 statute. And the inference there is actually directly 15 contrary to the explicit statements in the legislative 16 history. 17 With that being said, I would like to turn to just 18 a couple of the other issues because I am running short on 19 time. 20 In terms of the first question, "May denial of 21 restoration be arbitrary and capricious solely for being in 22 violation of the agency's own internal rules," I think 23 there's absolutely no question about the correct answer to 24 that. And here it's clearly yes, the Postal Service has 25 violated the ELM and the EL 505. The Postal Service doesn't 15 1 dispute in their briefs Supreme Court precedent, Federal 2 Circuit precedent, other Circuit Court precedents clearly 3 say that an agency has to abide by its regulations, even if 4 the agency gratuitously promulgates regulations that are 5 stricter than what are required under the statute. 6 CHAIRMAN GRUNDMANN: Let's say we agree with you 7 on that point. Let's take it to the next step. Is there an 8 unconditional right to restoration? And does work have to 9 be available? I mean, what makes work available and 10 unavailable? 11 MR. DOWD: Chairman Grundmann, there's no absolute 12 right to being restored. I think that's pretty clear for 13 partially recovered employees. But what the Postal Service 14 does have to do is just comply with the steps and the 15 procedures it set forth in its own regulations and rules, 16 which are clearly set forth in the ELM and EL 505. 17 So, if for each of these five individuals today, 18 if the Postal Service can demonstrate and prove that the 19 Postal Service complied with ELM and EL 505, and there was 20 no work available, and they couldn't make work -- because 21 under 546.222 in the ELM, the Postal Service acknowledges 22 that it has a duty to actually, you know, make work. Not 23 silly work, but it has to combine tasks so that it could 24 accommodate the medical restrictions of the employee, so it 25 doesn't just have to be open vacancies. 16 1 MEMBER ROSE: So if they're not classified 2 positions, how do they define what work is available? 3 MR. DOWD: Once again, you go to the ELM and you 4 go to EL 505 and you look at the medical restrictions of the 5 individual. And this is, again, set forth in 353, where 6 part of figuring out if there's arbitrary and capricious is 7 you look at the circumstances of each case. 8 CHAIRMAN GRUNDMANN: So what if somebody was doing 9 it on overtime? Somebody in the same craft was performing 10 the same type of work overtime, would that make the work 11 unavailable or available? 12 MR. DOWD: Are you referring to another 13 individual? 14 CHAIRMAN GRUNDMANN: Yes. 15 MR. DOWD: Yes. And they're doing the work in 16 overtime? 17 CHAIRMAN GRUNDMANN: Yes. Say it's in the same 18 craft. 19 MR. DOWD: In the same craft, I think that's -- if 20 you go through the procedure that's set forth in the Postal 21 Service's guidelines, I think that's available work. 22 CHAIRMAN GRUNDMANN: That would be available work? 23 MR. DOWD: I mean, it also makes sense. Why would 24 the Postal Service want to pay extra to have someone do it 25 in overtime when they could have a fully capable individual 17 1 within their medical restrictions to do that work? 2 CHAIRMAN GRUNDMANN: Well, then -- 3 MEMBER ROSE: So if an employee has a job, an 4 8-hour job and this employee has 6 hours of heavy duty work, 5 lifting bags of 60 pounds or whatever, and then 2 hours is 6 just sweeping up the letters that fall out of the bags, 7 right? 8 MR. DOWD: Yes. 9 MEMBER ROSE: This is an exaggerated example. So 10 do they just snap that right out of that guy's job 11 description and give it -- make another available work 12 situation? Is that how they do it? 13 MR. DOWD: I'm not sure they do it that way, but, 14 again, it has to be done with respect to the procedure set 15 forth in the ELM. In the ELM it has a pretty clear table 16 that shows the Postal Service what to do. And keep in mind 17 it also has to restore the employee -- the partially 18 recovered employee -- in a way that doesn't detrimentally 19 effect current employees, with respect to seniority, for 20 example. 21 MEMBER ROSE: Okay. 22 MR. DOWD: I only have one minute of my rebuttal 23 time, so I -- 24 VICE CHAIRMAN WAGNER: We can -- 25 CHAIRMAN GRUNDMANN: We'll take care of that. 18 1 MR. DOWD: Okay. 2 VICE CHAIRMAN WAGNER: I have a question. If 3 these cases actually involve employees who were working in 4 modified assignments and then being reassigned or denied 5 that work, so, I mean, in that instance, I mean, is the fact 6 that the work -- that they were performing the work at all, 7 prima facie evidence that it was available? 8 MR. DOWD: Absolutely. Absolutely. Under the 9 ELM, because these five individuals, they were all restored 10 as partially recovered employees under the Postal Service's 11 guidelines that have been in existence for about 30 years. 12 What happened was that the NRP came along, they changed 13 their way -- and what's also notable is that -- and this is, 14 again, another example of arbitrary capricious action by an 15 agency. The NRP was in effect for a certain amount of time, 16 and as of January 31, 2011, of this year, the Postal Service 17 is no longer implementing the NRP. And they've stated in a 18 letter -- I'm not sure if this is in the record, but Mr. 19 Bubb, I'm sure, can confirm this -- they're going back to 20 the provisions that are set forth in the ELM. 21 So the way I understand it, if my five clients, 22 Postal Service employees, if they apply for restoration 23 today, they could possibly get it back. 24 CHAIRMAN GRUNDMANN: Let me ask you one question. 25 One of the unions argued that the Board should defer 19 1 adjudication of these cases to the parties' collective 2 grievance procedure. Do you have a position on that? 3 MR. DOWD: Yes, Chairman Grundmann. I don't see 4 any reason to defer. The Board's jurisdiction is set forth 5 in 353 -- 5 CFR 353. You have an obligation to carry out 6 the Board's duty. Now, of course, if there is some strong 7 compelling reason to defer, you might want to consider that. 8 And I believe this is the APWU's brief. They only 9 cite one case. They cite no other cases that support the 10 reason for deference. And the other thing to keep in mind 11 is that the Board's jurisdiction with respect to restoration 12 of employees is limited to denials of restoration. 13 So if you get into an issue of whether the actual 14 restoration was appropriate or sufficient or consistent with 15 the medical restrictions, that's something that goes over to 16 OWCP. And maybe that's something that's more appropriate to 17 be dealt with in the grievance procedure, but here the Board 18 does have an obligation to carry out its regulatory mandate. 19 CHAIRMAN GRUNDMANN: Thank you, Mr. Dowd. We'll 20 give you an additional -- 21 MEMBER ROSE: Just one more? 22 CHAIRMAN GRUNDMANN: Sure, okay. 23 MEMBER ROSE: I would like to ask a question. It 24 is clear that the Board has ruled that substantive rights 25 provided by the federal law and regulation to employees who 20 1 have partially recovered from a compensable injury are 2 limited to restoration to a position that constitutes a 3 separate and distinct unencumbered position. Now, this has 4 been since the Civil Service Reform Act and yet you explain 5 that we're making available work that aren't classified 6 positions for employees. 7 MR. DOWD: Yes. 8 MEMBER ROSE: And I would like to ask you, 9 wouldn't the Board have exceeded its legal rights or its 10 authority in restoration appeals by making a decision on 11 this? We're speaking purely of contractual rights, you 12 know. And again, I think that maybe a negotiated grievance 13 procedure would be the proper forum for this. 14 MR. DOWD: Member Rose, I appreciate that question 15 and concern. I have a couple of points on that. First is 16 that although there are contractual rights implicated in 17 this case, it's not solely contractual rights. These are 18 rights that are set forth in the Agency's regulations and 19 guidelines. And if you look at 39 CFR -- I forget the 20 section -- but what it does is it explicitly incorporates 21 into the regulations sections of the ELM and the ELM itself. 22 And what ELM 546.222 states is that with respect to 23 reassignment or reemployment of a partially recovered 24 employee, such an assignment may be to a residual vacancy or 25 to a position uniquely created to fit those restrictions. 21 1 However, such assignment must not impair seniority rights of 2 PTF employees. 3 Now, with respect to a prior Board decision that 4 might have ruled contrary to what is set forth in the ELM, 5 I'm not really certain, in terms of the timing of this. It 6 might have been that the ELM was different in the past. And 7 honestly, it might have been that that Board decision is not 8 correctly decided. But here, under Supreme Court precedent, 9 under the Circuit precedent, what the Agency is obligated to 10 do is to comply with the regulations that it has set forth. 11 And as far as I can tell with my review of the 12 record, the Postal Service does not dispute that their 13 conduct under the NRP is not consistent with their 14 regulations. Thank you. 15 CHAIRMAN GRUNDMANN: Thank you, Mr. Dowd. Save 16 five more minutes, will you? 17 Next we have Mr. Secular for an amicus curiae, 18 National Association of Letter Carriers. Good morning, sir. 19 MR. SECULAR: Good morning. May it please the 20 Board, thank you of the opportunity to address you. Let me 21 state at the outset that NALC agrees with the Postal Service 22 that the question of limited duty is fundamentally a 23 contractual issue. And those disputes over the assignment 24 of limited duty as a general rule can be resolved in the 25 parties' grievance arbitration procedure. 22 1 But having said that, we believe that as to the 2 pure legal issue that's presented here, the Appellants do 3 have the better argument and that the regulation which gives 4 employees the option of appealing disputes over limited duty 5 to the Board is, in fact, consistent with the statute. 6 Now, Mr. Dowd has addressed the ambiguity arising 7 over the word "overcome." We think it's telling that the 8 statute does not use the term "full recovery." There's no 9 reason to assume that "overcome" is synonymous with "full 10 recovery." In fact, it's reasonable, in our view, to 11 suggest that an employee who was injured and has recovered 12 to the point where he or she can assume productive work with 13 the Postal Service has overcome the injury. 14 CHAIRMAN GRUNDMANN: Let me pick up where the vice 15 chair started with Mr. Dowd. Did the agency bargain the 16 National Reassessment Program with the unions? 17 MR. SECULAR: No. 18 CHAIRMAN GRUNDMANN: With respect to provisions 19 governing the ELM and the EL, are there local agreements 20 that further affixiate -- 21 MR. SECULAR: There can be local agreements or 22 local practices. 23 CHAIRMAN GRUNDMANN: Okay. What do those look 24 like? What impact do they have? 25 MR. SECULAR: Well, local practices are looked to 23 1 on a case-by-case basis by arbitrators in resolving these 2 disputes. Maybe I should address Member -- I think it was 3 Member Rose's line of inquiry or perhaps Vice Chairman 4 Wagner's about how the work is deemed available. 5 Overwhelmingly, these cases are about limited duty 6 that is taken away from employees. And what happens is the 7 focus of the inquiry is, is the work still there? Now, the 8 reason we have an NRP, the reason we have such an explosion 9 in the number of cases is that the Postal Service's workload 10 is shrinking. Everyone knows that. And so what happens is 11 you have disputes over whether work that was given to 12 injured employees still exists. And when the employees 13 prevail in the grievance procedure, the union is successful 14 in showing that the work has not disappeared; that, in fact, 15 the work that had been given to the employee was reassigned 16 to somebody else. Typically, that's perhaps a non-career 17 employee or it may be to an employee who is now performing 18 the tasks on overtime. And so if the tasks still exist, 19 then there is no justification under the Postal Service's 20 regulations for taking it away from the employee. 21 CHAIRMAN GRUNDMANN: Well, going down that line of 22 reasoning, then an employee's rights under the ELM and the 23 EL can trump the operational needs of an agency. 24 MR. SECULAR: Yes. Well, depending on how you 25 define "operational needs." The regulations -- 24 1 CHAIRMAN GRUNDMANN: How would you define it? 2 MR. SECULAR: -- as we see it, do not permit the 3 Postal Service to make the most efficient choice, to assign 4 work to an able-bodied employee because that able-bodied 5 employee can do the work more quickly, for example. It does 6 have an obligation under its own regulations to restore the 7 employees to work and to provide them with limited duty if 8 the work is there. 9 CHAIRMAN GRUNDMANN: Well, when can the 10 operational needs of an agency trump, loosely speaking, the 11 ELM and the EL? 12 MR. SECULAR: Well, we don't recognize operational 13 needs as a relevant concept in these cases. In our view the 14 issue is, is the work there? And, again, I want to 15 emphasize that the cases come up because work had been given 16 to the employee. The Postal Service, back in the day, when 17 these regulations were formulated, was doing everything it 18 could to bring injured employees back to work and make them 19 productive because the Postal Service is on the hook for the 20 compensation costs. And it is only in this new era of 21 shrinking mail volume and work disappearing that we now have 22 disputes over whether work exists. But if the work exists, 23 the regulations -- which admittedly were crafted in a 24 different era -- do require the Postal Service to give the 25 work to the employee, if it is within the employee's medical 25 1 restrictions, and if the work still exists and is available 2 to the employee. 3 VICE CHAIRMAN WAGNER: What does that mean, if it 4 still exists, in the sense of is there some objective 5 financial, economic rationale for continuing -- 6 MR. SECULAR: Well, you know, mail volume may have 7 shrunk to the point where there isn't enough work to occupy 8 an employee who can't go out on the street and deliver it, 9 but was just casing it, for example. 10 VICE CHAIRMAN WAGNER: Okay. So the idea of make- 11 work is really inconsistent with your formulation of the 12 tasks still exist. 13 MR. SECULAR: Right. Well, we're not talking 14 about counting paper clips, we're talking about work that 15 normally has to get done by somebody for the Postal Service 16 to function. 17 CHAIRMAN GRUNDMANN: So there is no make-work. 18 MR. SECULAR: There's also another example. This 19 may make more sense. There's a lot of consolidation going 20 on in the Postal Service right now and work -- mail is being 21 routed through different post offices. So, if an employee 22 was working in the office to case mail in an office, that 23 mail may now be cased in some other office and may no longer 24 exist. 25 VICE CHAIRMAN WAGNER: Oh, so it's like it exists 26 1 per local -- 2 MR. SECULAR: Within each office, yes. The focus 3 is local under the regulations. 4 VICE CHAIRMAN WAGNER: So does the union concede 5 that the Postal Service can unilaterally determine whether 6 that task still exists or not? 7 MR. SECULAR: No, that's normally what -- is the 8 inquiry. It's a fact, case-by-case inquiry, but that's 9 usually what the issue is. Does the task still exist? 10 CHAIRMAN GRUNDMANN: And is someone else doing it? 11 MR. SECULAR: That's normally how the union proves 12 that the task still exists, by showing that another employee 13 is doing it. 14 VICE CHAIRMAN WAGNER: But another employee could 15 be doing it at a different location. 16 MR. SECULAR: Right. 17 VICE CHAIRMAN WAGNER: That's -- 18 MR. SECULAR: Right. Another employee within the 19 same office. 20 CHAIRMAN GRUNDMANN: What about a different 21 office? 22 MR. SECULAR: Well, that's getting harder and 23 harder to make that case, but it could be made. Employees, 24 generally, are fighting to remain in the office where 25 they're assigned. And it's increasingly difficult to get 27 1 employees assigned to limited duty work in another office 2 because there are normally employees there who need the 3 limited duty work. 4 VICE CHAIRMAN WAGNER: So I'm sure you're familiar 5 with the 50-mile radius concept that we have generally 6 incorporated into determining these types of cases. I mean, 7 that would seem to exceed beyond the specific office inquiry 8 that you're talking about. 9 MR. SECULAR: Well, I would say that, yes, that's 10 different. The regulations to that extent differ from the 11 concept of a commuting area for restoration. I'm not saying 12 that the employees, when they come here, will be arguing the 13 exact same concepts and rules that they would be in the 14 context of a grievance procedure. 15 VICE CHAIRMAN WAGNER: But you are -- maybe I'm 16 just confused, but it does sound like that the grievance -- 17 that the contractual right now sounds actually more narrow 18 than the regulatory right to restoration. 19 CHAIRMAN GRUNDMANN: In other words, it's beyond 20 the facility. 21 MR. SECULAR: The contractual right is to work 22 outside the facility. The reason I'm hesitating to answer 23 is because the regulations were set up to prevent employees 24 from being transferred out of their office. The origin of 25 the regulation had to do with -- 28 1 CHAIRMAN GRUNDMANN: Are you talking about CFR or 2 the ELM? 3 MR. SECULAR: The ELM. 4 CHAIRMAN GRUNDMANN: Okay. 5 MR. SECULAR: The ELM was changed in 1979 by the 6 virtue of an agreement between the union and the Postal 7 Service. That was done because, in the union's view, the 8 Postal Service was exploiting the limited duty options by 9 assigning people to graveyard shifts in distant offices to 10 discourage them from making compensation claims. And so the 11 protections were incorporated into the ELM to allow 12 employees to work their normal schedules in their home 13 offices. 14 So moving outside their office is, actually, a 15 last resort under the regulations. 16 VICE CHAIRMAN WAGNER: That's the pecking order, 17 correct? 18 MR. SECULAR: That's the pecking order. 19 VICE CHAIRMAN WAGNER: And at some point, down 20 pecking order, there is the right to go beyond the facility. 21 MR. SECULAR: Yes, yes. Right. 22 CHAIRMAN GRUNDMANN: But that's -- 23 MR. SECULAR: I can't say that there couldn't be a 24 case where someone is claiming work in a distant office 25 under the pecking order, but that would be very rare. 29 1 Usually the focus is not being sent to another office. 2 MEMBER ROSE: I'm still having difficulty with the 3 legal authority that the Board has to restore someone to a 4 task rather than a separate or distinct or already separate 5 -- 6 MR. SECULAR: Well, yes. Member Rose, thank you 7 for raising that. I think that there's obfuscation going on 8 here between the concept of a position and the concept of an 9 assignment. All these employees have positions and I think, 10 if you read the Anchetta line of cases on disability 11 retirement that it becomes very clear. An employee who is 12 reassigned to limited duty has an on-the-rolls complement 13 position of city letter carrier. What may change is the 14 tasks that the employee is assigned, the duty assignment. 15 And, for example, when Anchetta applied for 16 disability retirement, the Board concluded that her modified 17 letter carrier job was not a separate position, but that 18 didn't mean Anchetta didn't have a position. Instead it 19 meant that her position remained, as it does for these 20 limited duty letter carriers, city letter carrier. 21 Positions in the Postal Service have standard 22 descriptions in their regulations. Anyone on the complement 23 has a position of record, so these limited duty employees, 24 they come back to work, they are still on the rolls as city 25 letter carriers, but they may have a modified assignment. 30 1 It doesn't mean they don't have a position. When they have 2 these modified assignments, they're still being restored to 3 a position that we think easily fits within the notion of an 4 equivalent position at its stature. 5 VICE CHAIRMAN WAGNER: But what's the position 6 without any assignments? What does that become? 7 MR. SECULAR: There is a position or a concept in 8 the Postal Service of unassigned regular. That happens all 9 the time. A letter carrier could have his route abolished, 10 for example. He could go from having a delivery route that 11 he delivers every day to having no set duties and be 12 assigned to different duties each day, filling in for other 13 carriers because the route no longer exists. That has 14 nothing to do with injuries, but -- 15 CHAIRMAN GRUNDMANN: Well, let me ask you this. 16 Let's go the next step further. Say I'm a partially 17 recovered employee coming up with an unassigned regular 18 person, who gets what? 19 MR. SECULAR: Well, again, it depends on what the 20 injured letter carrier has been doing. You know, I don't 21 know off the top of my head -- and I'm not sure the Postal 22 Service would be on the hook if work has been assigned to an 23 unassigned regular. I don't know that the injured letter 24 carrier necessarily gets priority for work he's never done 25 before. 31 1 CHAIRMAN GRUNDMANN: So then, that would be work 2 unavailable, if it's the same craft? 3 MR. SECULAR: Yes, yes. 4 VICE CHAIRMAN WAGNER: But these cases involve 5 people who've been sent home, so what does it mean for them 6 to have the position? I'm unclear about that, when they're 7 not actually working. And I presume they're not getting 8 paid if they're not actually working. 9 MR. SECULAR: Right. That's right, but when they 10 are working they have a position as part of the complement 11 as city letter carrier. I'd ask the Board to recall that 12 the Board has recognized that positions in the Postal 13 Service don't line up with the standard Civil Service 14 definitions. And in the Anchetta line of cases, the 15 question of what is a position -- what the employee's 16 position is -- was treated as an issue of fact. 17 In fact, I believe all those cases were remanded 18 to the administrative judge for findings on that issue. And 19 I think the recognition was that it's specific to each 20 individual, but there is always a position of record when 21 someone is on the rolls and working for the Postal Service. 22 CHAIRMAN GRUNDMANN: Thank you, sir. 23 MR. SECULAR: Thank you. 24 VICE CHAIRMAN WAGNER: Thank you. 25 CHAIRMAN GRUNDMANN: Next we have Mr. Anderson, 32 1 amicus curiae for the American Postal Workers Union. Good 2 morning, sir. 3 MR. ANDERSON: Good morning. May it please the 4 Board, I'm Darryl Anderson, as you know, and I represent the 5 American Postal Workers Union. On behalf of the American 6 Postal Workers Union, thank you for making this time 7 available. 8 I want to start with the issue of jurisdiction. 9 It seems to me the Board needs to consider whether and how 10 to give meaning to the words, what is arbitrary and 11 capricious? Because as you look at contract violations, 12 which is what ELM violations are, the ELM is incorporated by 13 reference into the collective bargaining agreement. As the 14 Board looks at those contract violations, if every contract 15 violation becomes arbitrary and capricious, I mean, that's 16 almost an oxymoron. We have thousands of arbitration cases 17 every year in the Postal Service -- 18 CHAIRMAN GRUNDMANN: Well, you have a statement in 19 your brief -- and that was kind curious to me. I mean, you 20 state that not every violation of the ELM is arbitrary and 21 capricious. 22 MR. ANDERSON: Right. 23 CHAIRMAN GRUNDMANN: What, in your opinion, would 24 not be arbitrary and capricious? 25 MR. ANDERSON: Well, for example -- and I guess 33 1 maybe the way -- I want to start the other way, if I may? 2 And that is that when the NRP arguably was arbitrary and 3 capricious because the Postal Service, they didn't negotiate 4 it. They brought the NRP in and slammed it in and took 5 people off jobs where the work was still there. That's 6 pretty arbitrary. 7 On the other hand, it may well be -- and we've had 8 many cases -- we've arbitrated many cases under 546 of the 9 ELM where the issue becomes was there work available? And 10 also, 546 of the ELM, for example, requires the Postal 11 Service to respect seniority rights of other employees. And 12 so often there's a conflict between the employees, some of 13 whom may be represented by one union, some of whom may be 14 represented by another union. And we've had arbitrations 15 where the issue becomes did the Postal Service correctly 16 apply the contract? 17 That is a garden variety contract interpretation 18 case. It may well be that the supervisors and managers 19 applying in that case were looking at the 505, looking at 20 the 546, looking at the collective bargaining agreement, and 21 were trying in good faith to figure out what to do. What 22 were their obligations? It's not clear. And they might 23 have made a mistake, but the arbitrator will tell them 24 whether or not they made a mistake six months after they 25 make their decision. And so to say that every mistake they 34 1 make is arbitrary and capricious, it seems to me, is not 2 correct. 3 It's arbitrary when they come in and say nothing 4 has changed. No contract has changed. No fact has changed. 5 The work is still there. We're taking this new program and 6 we're taking you out of your job. That's pretty arbitrary 7 and we think it violated the contract that violated the 8 regulations. But not every case is arbitrary. In fact, 9 most of them are not. 10 I mean, I've spent my career arguing that the 11 Postal Service has made mistakes. That's what I do for a 12 living. And they make mistakes all the time. And sometimes 13 they're arbitrary, but most of them, frankly, aren't. They 14 try to do their job. They try to interpret the contract. 15 It's my job to disagree with them when they're wrong, and I 16 do that. But it seems to me not necessarily arbitrary just 17 because they're wrong. 18 VICE CHAIRMAN WAGNER: I thought the APWU's 19 argument in this regard somewhat curious because it seems 20 like when you're trying -- number one, you're going actually 21 to the merits of the arbitrary and capricious determination. 22 I mean, and that's -- you know, a contractual violation 23 arguably states -- makes a non-frivolous allegation of 24 arbitrary and capricious denial. It would be then a 25 question of getting to the merits of that, whether, in fact, 35 1 there was, you know, the denial, you know, the kind of 2 contractual violation reached the level of arbitrary and 3 capriciousness. That's really what you're getting at. And 4 I'm just curious why is the APWU taking that position in 5 this case when the issue is about really our jurisdictional 6 authority and whether individual Postal employees can come 7 in and attempt to seek relief at the Board for arguably 8 arbitrary and capricious denial based on contractual 9 violation. 10 MR. ANDERSON: Well, the serious concern the APWU 11 has is respect for seniority rights. The pattern has tended 12 to be over the years that city letter carriers have become 13 unable to carry their routes anymore after 20 years of 14 carrying a route, and they deserve accommodation and they 15 seek accommodation in clerk jobs, many of which tend to be 16 more sedentary. And there may be clerks who have worked 17 their jobs, perhaps more vigorous jobs working on machinery, 18 loading and unloading mail processing machinery, who've 19 waited for 25 years to get one of those jobs that's 20 sedentary. And so there becomes a conflict between the 21 seniority of the clerks who are waiting to bid for that job 22 and the needs of the carrier for accommodation. 23 And that's a very complex question. I mean, 24 there's a moral and ethical obligation to accommodate an 25 employee injured on the job. There's another type of 36 1 imperative to recognize seniority rights and to respect the 2 interests of somebody who may have worked the graveyard 3 shift working heavy machinery for 25 years, and wanted for 4 all that time to have a day job where they didn't have to 5 kill themselves and get carpal tunnel syndrome or risk 6 carpal tunnel syndrome or a bad back. But now that work's 7 unavailable because it's been taken up by somebody 8 accommodated who needs an accommodation. Those are 9 difficult and very complicated questions. 10 VICE CHAIRMAN WAGNER: So are you suggesting that 11 the Board is incapable in some way -- 12 MR. ANDERSON: Not in the least. 13 VICE CHAIRMAN WAGNER: -- in making -- 14 MR. ANDERSON: But -- 15 VICE CHAIRMAN WAGNER: -- its determination? 16 MR. ANDERSON: No, not at all. What I'm saying 17 is, though, that they raise contractual seniority rights 18 issues. And if the Board decides that it has jurisdiction 19 over every one of these cases, you're taking jurisdiction 20 over potentially thousands of cases, individual cases, which 21 will turn -- unlike the NRP program which they slammed in 22 nationwide, these other cases are going to be garden variety 23 contract interpretation cases. You're going to be 24 interpreting seniority right under the contract. You're 25 going to be interpreting the ELM, which is part of the 37 1 contract, incorporated by reference into the contract. So 2 you're going to be dealing with garden variety contract 3 interpretation cases in parallel with a very active and very 4 numerous arbitration system operated by the Postal Service 5 and its unions. So you'll be having parallel cases dealing 6 with contract interpretation issues, and that's what they 7 are. 8 CHAIRMAN GRUNDMANN: And are you conceding that 9 the National Reassessment Program is not part of the 10 analysis of the cases before us? 11 MR. ANDERSON: I'm sorry, Chairman Grundmann, your 12 question's beyond my knowledge. I don't know the answer to 13 that question. 14 I want to say that the APWU believes it's correct 15 that the Postal Service should be required to adhere to its 16 contracts and to its regulations and to its ELM, but, again, 17 not every violation is arbitrary and capricious. And if the 18 term "arbitrary and capricious" has any meaning, then there 19 has to be a distinction between a good faith effort, but 20 mistaken effort, to apply the contract or not. I would like 21 to make an analogy, if I may. 22 Under the National Labor Relations Act if the 23 employer violates a contract, that's not an unfair labor 24 practice. If the employer knows what the contract requires 25 and they arbitrarily and obstinately violate the contract 38 1 knowing that they're violating it, that's an unfair labor 2 practice. 3 CHAIRMAN GRUNDMANN: So it's a matter of intent. 4 MR. ANDERSON: It's a matter of intent. And if 5 they absolutely flaunt their determination to violate the 6 contract regardless of their contractual obligations, you've 7 got bad faith. That's arbitrary -- that's a violation. You 8 can take it to the National Labor Relations Board and you 9 can get an unfair labor practice complaint issued. But if 10 it's simply a contract violation, they dismiss it because 11 it's not within their jurisdiction. It was not a violation 12 of the act, that is. 13 And I would just mention that desirable as it is 14 to enforce the ELM and the contract against the Postal 15 Service, the Congress when they legislated did not 16 necessarily make provision for that. I mean, if the 17 question is arbitrary and capricious, if that defines the 18 Board's jurisdiction, then that defines the Board's 19 jurisdiction. And I would offer the familiar case of Fausto 20 decided by the U.S. Supreme Court as an example of how even 21 in a comprehensive Civil Service Reform Act scheme, the 22 Congress did not choose to make every avenue of relief 23 available to every employee. And so I think the Board needs 24 to consider very carefully whether and how it can give 25 substantive meaning to the term "arbitrary and capricious." 39 1 CHAIRMAN GRUNDMANN: Anything else? Thank you, 2 sir. 3 MR. ANDERSON: Thank you very much for your 4 courtesy and for your time. 5 CHAIRMAN GRUNDMANN: Finally we have Mr. Bubb for 6 the Agency. 7 MR. BUBB: Good morning. 8 CHAIRMAN GRUNDMANN: Good morning. 9 VICE CHAIRMAN WAGNER: Good morning. 10 MR. BUBB: If it please the Board, my name is 11 William Bubb and, as you know, I'm here on behalf of the 12 Postal Service. Thank you very much for this time. 13 I don't think any of us thought when we read the 14 consolidation order that it would take us where it has, but 15 we've tried to follow the law. We hope we are leading you 16 in that direction as well and we appreciate the time you 17 have spent considering our arguments, which is obvious from 18 your questions. 19 It is clear in our mind that OPM has exceeded its 20 authority under FECA to require any agency under the guise 21 of 8151, which is the section of FECA that deals with 22 restoration and, by the way, the only section of FECA under 23 which the OPM has any authority -- the balance of the 24 statute, there's no blanks that need to be filled in to use 25 Mr. Dowd's analogy, is administered by the secretary of 40 1 labor. And I'd like to come on to that in a few minutes if 2 I have time. But focusing on 8151, I think the statute 3 reads clearly. And I can tell that you do understand our 4 argument in that regard and I don't believe there's much 5 more I can say about it here than we have said in our 6 briefs. 7 VICE CHAIRMAN WAGNER: Actually I do have a 8 question. 9 MR. BUBB: Right. 10 VICE CHAIRMAN WAGNER: And even if we were to 11 agree with you, and I'm not suggesting that we do -- 12 MR. BUBB: I understand. 13 VICE CHAIRMAN WAGNER: -- in terms of what the 14 statute means and what authority it gives OPM, I mean, I do 15 think that -- I do see ambiguity in that language to a 16 certain degree. I understand the Postal Service argument 17 and I think in some level they're well taken. But you're 18 raising an ultra vires argument. You're challenging OPM's 19 authority to issue the regulation and our authority to 20 declare an OPM regulation invalid is really limited to when 21 there is -- it's under USA 1214. It's when a prohibitive 22 personnel practice would be committed as a result of the 23 regulation or implementation of the regulation. We don't 24 have the general APA jurisdiction to declare OPM's action to 25 be ultra vires. So where does that leave you? 41 1 MR. BUBB: I'm not asking you to do that. I'm 2 asking you to determine your own jurisdiction based on that 3 regulation. 4 VICE CHAIRMAN WAGNER: But our jurisdiction is 5 regulatory under OPM's -- 6 MR. BUBB: You have in the past, Vice Chairman 7 Wagner, said that you are suspicious of grants of 8 jurisdiction to you, that your jurisdiction is not plenary. 9 And while you tend to generally acknowledge that OPM is an 10 agency that can establish jurisdiction for you, you still 11 have taken a jaundiced eye of that. And you certainly don't 12 look to any other -- you don't, in my mind, seem to be 13 willing to allow any other agency, like the Postal Service, 14 for example, to do something that would grant or establish 15 jurisdiction for you. 16 CHAIRMAN GRUNDMANN: Let me ask you this. You're 17 talking about particularly 301C and D especially, not the 18 grant of jurisdiction for arbitrary and capricious. So do 19 we even have to invalidate an OPM reg to answer the question 20 which we posed to the parties, which is, is a violation 21 arbitrary and capricious if the Agency's own internal rules 22 grant greater substantive rights than the statute or 23 regulation? We're not talking about the OPM rules. We're 24 talking about the Agency rules. 25 MR. BUBB: I think so, Chairman Grundmann, because 42 1 when I read your question I believe you were asking whether 2 you could exercise jurisdiction when that was based only on 3 an internal Agency rule. I respectfully disagree with Mr. 4 Dowd's view of that. We know, do we not, that the arbitrary 5 or capricious standard is all about your jurisdiction? 6 That's in the section of the regulations that say these are 7 the appeals that may be brought to the MSPB with respect to 8 restoration rights granted elsewhere in these regulations. 9 That's all about your jurisdiction. 10 And also, contrary to what Mr. Dowd said, the OPM 11 did address that issue. If you're not asking us about 12 jurisdiction, which I understood you to be doing, then I'm a 13 little taken aback. 14 CHAIRMAN GRUNDMANN: Okay. Let me just ask you a 15 question. 16 MR. BUBB: All right. 17 CHAIRMAN GRUNDMANN: 301C and D, would we have to 18 invalidate that in order to find that we have or do not have 19 jurisdiction? Because you've argued throughout your brief 20 that 301C and D are ultra vires, which goes back to the vice 21 chair's question of is this a prohibitive personnel 22 practice, which is where we derive our jurisdiction. 23 MR. BUBB: You would have to -- I don't know that 24 you would have to completely invalidate -- and if you'll 25 forgive me, I'd like to focus on D, the partially recovered 43 1 one, which I understood to be the focus of your inquiry. We 2 can go back to C, if you'd like. 3 You just can't read it, Chairman Grundmann, to 4 require restoration under 8151 to something other than a 5 position or to someone other than a fully recovered 6 individual. There are ways to read it where that -- in that 7 way it uses the word "restore." That's a term of art. 8 That's not a coincidence. That means to a position. If you 9 go back and read all the regulations, "restoration," 10 "restore," term of art. As a matter of fact, 3101C is the 11 only one of the restoration obligations that does not use 12 some form of the word "restore" or "restoration." You could 13 easily say we're reading this to require an assignment to a 14 regular position and that's as far as we're going to go. 15 VICE CHAIRMAN WAGNER: You know, even if we -- I 16 mean, there's no dispute that the regulation talks about 17 restoration to a position, and that's not the question here. 18 The question is did the Postal Service in agreeing to the 19 ELM provisions and the handbook, the EL and whatnot, take 20 upon itself an obligation to define restoration as something 21 more than that, which the regulation D, and certainly as OPM 22 has construed it, would allow the Postal Service to do. So 23 in terms of what is the content of arbitrary and capricious 24 denial, you know, if the Postal Service has taken on 25 additional obligations, then do we have the authority under 44 1 304C to enforce those in terms of looking at them, you know, 2 under the arbitrary and capricious standard. 3 My question is our authority is completely 4 regulatory. It's pursuant to 304C, which is contingent upon 5 the validity of, as you point out, the, you know, 301C and D 6 -- forget C for a second because that's not really what 7 we're talking about -- D, partially recovered. If OPM 8 doesn't have authority to have issued that substantive 9 regulation creating right, presumably we don't have 10 jurisdiction to enforce a right if OPM didn't have authority 11 to create it. That's your argument, right? 12 MR. BUBB: Yes. 13 VICE CHAIRMAN WAGNER: Okay. But my question to 14 you is we don't have authority to tell OPM whether it could 15 or couldn't create that right. 16 MR. BUBB: But you have the authority, Vice 17 Chairman Wagner, to say whether you can have jurisdiction. 18 You have to have that authority. 19 VICE CHAIRMAN WAGNER: Yeah. Our jurisdiction is 20 pursuant to an OPM reg, which is -- 21 MR. BUBB: And it failed to grant you jurisdiction 22 is all that we're asking you to determine. 23 VICE CHAIRMAN WAGNER: No, the regulation clearly 24 grants us jurisdiction to look at restoration rights of 25 partially recovered employees. There's no doubt about that, 45 1 right. 2 MR. BUBB: I understand the question. 3 VICE CHAIRMAN WAGNER: You're saying that OPM 4 didn't have authority to create restoration rights for 5 partially recovered individuals. 6 MR. BUBB: Or to assign an appeal right for those 7 individuals with you. 8 CHAIRMAN GRUNDMANN: So because 301D is invalid, 9 then we can't enforce it under 304. Is that what you're 10 saying? Because it relates to -- 11 MR. BUBB: Yes. 12 CHAIRMAN GRUNDMANN: It relates to partially -- 13 MR. BUBB: Yes, that is what we're saying. That 14 is what we're saying. 15 CHAIRMAN GRUNDMANN: Okay. So we would have to 16 invalidate D in order to find that we don't have 17 jurisdiction. 18 MR. BUBB: I wouldn't use the word "invalidate" 19 because -- and this gets back to your question, Vice 20 Chairman Wagner. I think we may be mischaracterizing what 21 we're asking you to do if we're saying that you have to 22 somehow decide that an OPM regulation was ultra vires and 23 you believe that you don't have the ability to do that. I 24 understand that there is a line of cases that may go in that 25 direction, but it cannot be that you can be required to 46 1 exercise jurisdiction when that grant of jurisdiction was 2 invalid, and you have to be the arbiter of that. 3 VICE CHAIRMAN WAGNER: No, we don't. 4 MR. BUBB: If that's not true, then -- I'm sorry. 5 VICE CHAIRMAN WAGNER: No, I mean, this isn't a 6 situation where we're interpreting a statutory grant of 7 jurisdiction, you know, from Congress. This is, you know, 8 Congress authorized the creation of jurisdiction through 9 regulation. OPM has issued a regulation creating that 10 jurisdiction. You're saying it's outside of its statutory 11 authority to do that. We don't have judicial review 12 authority in that regard. We can't invalidate regulations 13 because they're outside OPM's statutory authority to issue 14 them. 15 CHAIRMAN GRUNDMANN: Let me ask you another 16 question along these lines. What prohibitive personnel 17 practice can be committed or is the OPM reg invalid on its 18 face because it requires someone to commit a prohibitive 19 personnel practice, which is our granted jurisdiction? 20 MR. BUBB: Right. I'm not sure, Chairman 21 Grundmann, what the answer to that question is. 22 CHAIRMAN GRUNDMANN: Okay. 23 MEMBER ROSE: Can I go at a little bit of a 24 different direction on this? In most or all of the 25 situations in which the Board has enforced internal Agency 47 1 rules and collective bargaining terms, the Agency rules in 2 question were procedural in nature. Here, by contrast, 3 we're talking about substantive rights that are not provided 4 for by federal law or regulation. By what legal authority 5 could the Board enforce a substantive entitlement that is 6 not authorized by federal law or a regulation? 7 MR. BUBB: I don't believe there is any. That's 8 essentially my response to Vice Chairman Wagner's point 9 about ultra vires. I have to say I did not consider before 10 this morning the precise argument that you're making, Vice 11 Chairman Wagner. But intuitively, I believe you're correct, 12 Member Rose. 13 If the grant of jurisdiction is ultra vires, it's 14 up to you to say -- and I would think it's your 15 responsibility to say -- that's ineffective, we do not have 16 that jurisdiction. 17 CHAIRMAN GRUNDMANN: Or we don't have that 18 authority. 19 MR. BUBB: What if it were something ridiculously 20 obvious? OPM said -- I don't know, I can't even think of 21 anything off the top of my head, but it was clear that it 22 was something that OPM didn't have the ability to say you 23 could hear, what would you do? Would you say, well, it's a 24 regulation even if it's ultra vires, even if they didn't 25 have the authority to adopt it, and even if it's clear, 48 1 like, 99 out of 100 people or maybe 100 out of 100 people 2 would agree with that, we have to hear those cases? I'm 3 struggling standing here this morning with you to think that 4 that could possibly be the law. 5 CHAIRMAN GRUNDMANN: Let me ask you a different 6 question then. You've argued for the last 13 minutes and in 7 your brief that the CFR is invalid in some form. Have the 8 Agency ever made this argument before during the several 9 years of litigation that we've had with the National 10 Reassessment Program? 11 MR. BUBB: Not as far as I've been able to find, 12 Chairman Grundmann. 13 CHAIRMAN GRUNDMANN: Mr. Dowd made an interesting 14 point. He said that the Agency has thrown out the National 15 Reassessment Program and that his employees -- his clients 16 today could reapply for restoration under the ELM and they 17 would be restored consistent to the ELM. Do you agree with 18 that point? 19 MR. BUBB: No, I do not. 20 CHAIRMAN GRUNDMANN: Okay. Why? 21 MR. BUBB: For two reasons. The first reason is 22 that there was an agreement with our unions that the ELM 23 provisions in play here were not affected in the first place 24 by the NRP. 25 CHAIRMAN GRUNDMANN: So you collectively bargained 49 1 the NRP with the unions? 2 MR. BUBB: No, we reached an agreement with the 3 unions on or about the time the NRP was instituted in 4 response to concerns from the unions that we were not 5 changing ELM Section -- it's not our intention to change ELM 6 Section 546 by anything that's substantive. That's in the 7 NRP. Our view was that if you wanted to say that someone 8 who was affected by the NRP was -- those circumstances 9 somehow did not comply with 446, have it. And they have. 10 CHAIRMAN GRUNDMANN: Okay. So you reserve that 11 for litigation. 12 MR. BUBB: Yeah. The second thing is that because 13 of that, if someone comes today, even though the NRP does 14 not exist in name any longer, we're still faced with the 15 same sorts of issues that the amici both described with 16 respect to the size of the workforce and the availability of 17 work and those sorts of things. And I wouldn't say that 18 we've -- stopping the NRP does not equate to we're no longer 19 going to consider assignments and decide whether they're 20 necessary or not. I believe that that will happen. 21 CHAIRMAN GRUNDMANN: So you still -- 22 MR. BUBB: I can't speak definitively about that, 23 but that's my sense only to describe that it's not a light 24 switch situation, Chairman Grundmann -- 25 CHAIRMAN GRUNDMANN: So if I were a letter carrier 50 1 and I'm partially restored, would I be restored pursuant to 2 the ELM today? 3 MR. BUBB: Whatever is going to happen to you 4 today is no different under the ELM than would have happened 5 to you in the NRP. 6 CHAIRMAN GRUNDMANN: Okay. I don't know if they 7 would agree with you on that, but. 8 MR. BUBB: Well, they may not -- 9 CHAIRMAN GRUNDMANN: Okay. 10 MR. BUBB: -- which is actually illustrative of 11 why this belongs where it is, which is under their 12 collective bargaining agreements. 13 VICE CHAIRMAN WAGNER: Well, I think that they 14 might not agree with you because the NRP incorporates a 15 standard of operational necessity that appears -- at least I 16 didn't see it in the ELM -- there was a whole different 17 analysis of when modified assignments were to be created and 18 how they were to be created in the ELM that really doesn't 19 take into account the operational needs of the Postal 20 Service. The NRP seems to be really focused on that or had 21 been really focused on that. So how can you -- I'm -- 22 MR. BUBB: Right. I think that there was -- we 23 would say, and I think this is a fair view of this, there 24 was always an implication under the ELM that there was some 25 operational necessity. I mean, that's too strong of a word 51 1 because it's provocative in terms of how the unions of the 2 Postal Service view this issue, but it always was some 3 requirement that when we gave somebody work, there needed to 4 be some substance to it in the sense that it was meaningful 5 in some ways. Now, there was a continuum, no question about 6 it, of that conclusion, but still that was true. 7 I think it's fair to say that when the NRP came 8 into existence, probably just because of circumstances, Vice 9 Chairman Wagner, I mean, there was -- we were focused more. 10 The reason for the NRP is because we were focused more on 11 our circumstances, on our operational circumstances, on the 12 reduction of mail. And we needed to look maybe more closely 13 than we would have -- than we did in the past at these 14 assignments and see what, if anything, could or should be 15 done with respect to those assignments in a fair way. 16 I know that there is some disagreement about what 17 we did. I do not think there was any ill motive involved in 18 that. I think the motive is what I just described to you. 19 So in that sense, I think there might be a 20 difference between the ELM and ELM plus NRP. But 21 analytically, I don't believe there was any difference. And 22 the reason that the unions are winning the grievance when 23 they win -- they don't always win -- but the reason they're 24 winning the grievances, as Mr. Secular described, that they 25 are winning under the collective bargaining agreements is 52 1 because they're able to win on that issue. They're able to 2 say the work -- as Mr. Secular described, the work's still 3 there. 4 But we're winning those grievances when the case 5 is that the work either is gone or was not -- even though it 6 still could be done, was at the bottom of that continuum I 7 described earlier about whether it really should be done. 8 Is it reasonable for us to have somebody to do it even 9 though it's helpful to them based on the fact that it's just 10 meaningless or substantially meaningless work? Those things 11 are happening every day. Those decisions are happening 12 every day, as Mr. Secular points out, in case-specific 13 situations. 14 But if I can bring you back, this discussion 15 actually makes our argument for us. We're not saying, we've 16 never said that that ELM does not have force, that we don't 17 have to follow it, that there isn't a means by which it can 18 be enforced. There certainly is. It's the collective 19 bargaining agreements and the grievance procedures. What 20 we're trying to say is that it's not for you to enforce it. 21 And I believe, again, what you asked us when you 22 asked us whether a violation of the Agency's rules -- 23 whether only a violation of the Agency's rules can be an 24 arbitrary and capricious violation of restoration, you were 25 saying can we base jurisdiction under 301D when the only 53 1 thing that was violated was an Agency rule? To me, and I 2 hope to you, it's all about your jurisdiction, not about the 3 merits of claims under 546. 4 CHAIRMAN GRUNDMANN: This goes back to the 5 argument that Mr. Dowd raised in the first place, that the 6 statute is ambiguous in many ways. "Overcome," we've talked 7 about "equivalent position," I mean, what is an equivalent 8 position other than a former position, which is what the 9 statute says? 10 MR. BUBB: Well, but the term "equivalent 11 position" comes right after "former position or its 12 equivalent." 13 CHAIRMAN GRUNDMANN: So what is an equivalent 14 position if not the former position? Can it be a lesser 15 position? 16 MR. BUBB: I don't think so. We do not think so. 17 We think what Congress was saying is if you are able to do 18 your old job -- I think equivalence there, because your 19 precise old job may no longer be there, not because they 20 were trying to establish some sort of classification of jobs 21 that somehow was broader than your old job. If you've 22 recovered enough to perform your old job, then you have a 23 restoration right. 24 By the way, you don't have to -- it's not a 25 medical term. Don't get caught up in that. These phrases 54 1 like "partially recovered," "physically disqualified," even 2 "fully recovered" didn't exist when that statute was 3 written. We're thinking in terms of what the regulations 4 say today. Think of it in terms of plain English. That's 5 what Congress was doing. 6 VICE CHAIRMAN WAGNER: Well, wait. There was -- 7 the Civil Service Commission and the FPN had issued their 8 regulations and content given to these terms back before 9 1974, correct, before Congress enacted the amendment? So to 10 say that these were concepts that have just sort of come out 11 of thin air is not quite correct in terms of understanding 12 what the statute means. 13 MR. BUBB: What you just said may be true, I do 14 not know. And if I misspoke, I apologize. What I was 15 trying to say is that the regulations today and the meanings 16 of terms under the regulations today, like "physically 17 disqualified," "partially recovered," "fully," did not 18 exist. Those regulations -- I think the existing 19 definitions were published in, I don't remember, sometime in 20 1990. It's in our brief. 21 I'm just saying that the concept is not your 22 medical state. You could be not medically recovered from 23 whatever your illness or injury -- completely recovered, 24 fully recovered in the medical sense from whatever your 25 illness or injury is, but you may very well be fully 55 1 recovered in the restoration sense because you can perform 2 your old job. 3 CHAIRMAN GRUNDMANN: So in your mind equivalent 4 and former position are the same thing? 5 MR. BUBB: In my mind the term "former position or 6 equivalent" is intended to give meaning to the term 7 "overcome." And what "overcome" meant to Congress was 8 overcome your injury sufficiently so that you are able to 9 perform the job you were performing before. 10 CHAIRMAN GRUNDMANN: But it's not medical 11 overcome. It's -- 12 MR. BUBB: I may not be better medically, but once 13 I get to the point where I'm able to -- I've recovered to 14 the point where I can perform my old job, I have overcome my 15 injury in the sense of 8151 and, by the way, in the sense of 16 the current regulations. If you read the definition of 17 "fully recovered" you'll see that it's not a medical 18 concept. It's a functional concept. You're able to perform 19 the job you had when you were injured. 20 CHAIRMAN GRUNDMANN: And the equivalent only comes 21 in if my former position was abolished. 22 MR. BUBB: I'm guessing. I believe that that 23 would be a reason to put "equivalent" in there. I think the 24 language of the statute indicates that "equivalent" must 25 mean functionally equivalent in terms of your ability to 56 1 perform the duties of the job to your former position 2 because the location of that word in the prose. I think -- 3 the reason I suggested it might be there, that was a guess 4 on my part. But it is true, particularly in the fully 5 recovered requirements, which are not controversial, that 6 there -- 7 CHAIRMAN GRUNDMANN: Well, the term is not "fully 8 recovered," is it? 9 MR. BUBB: But I'm just saying it's true that if 10 you have an obligation to put someone in their former job, 11 you've got to find an equivalent because it's an absolute 12 obligation, as you know, for a fully recovered person. So 13 that would be another reason -- would be explanatory of why 14 that term was used. 15 VICE CHAIRMAN WAGNER: Can I just go back to your 16 point that the ELM tacitly or implicitly incorporated a 17 concept of operational necessity? And I understand that 18 that's kind of a loaded term, but just -- 19 MR. BUBB: Right, right. 20 VICE CHAIRMAN WAGNER: But if that were the case, 21 then why did the Postal Service feel the need to create the 22 NRP to begin with? I mean, if it could have achieved simply 23 through the ELM process the necessary, or in the Postal 24 Service's view the economically necessary, reductions and 25 changes and whatnot, if they could have done that under the 57 1 ELM, why not just do that? Why create this -- 2 MR. BUBB: I don't know. I don't know. It's well 3 before my time. But I do know that there was a need to 4 focus for the reasons that I gave you before on operational 5 necessity, on costs, on things like that. But -- 6 VICE CHAIRMAN WAGNER: I guess what I'm asking -- 7 MR. BUBB: -- I'm sorry, I don't know the answer 8 to your question. 9 VICE CHAIRMAN WAGNER: -- is if -- I mean, if we 10 were to find that we have jurisdiction and we're looking at 11 what is arbitrary and capricious, I mean, you're saying that 12 the Postal Service is winning cases where it can show that 13 even under the ELM that these were tasks that were no longer 14 being performed or needed to be performed. 15 MR. BUBB: Or were eliminated. 16 VICE CHAIRMAN WAGNER: Or were eliminated. 17 MR. BUBB: Right. 18 VICE CHAIRMAN WAGNER: So, I guess, is there some 19 objective evidence that the ELM, in fact, incorporates this 20 concept of meaningful work or operational necessity in terms 21 of the modified assignments question? It's not there in the 22 language -- 23 MR. BUBB: I do not know of any -- 24 VICE CHAIRMAN WAGNER: Okay. 25 MR. BUBB: I believe, as I said before, it's 58 1 implicit. There could be. I'm ignorant about it, I don't 2 know, I'm sorry. 3 CHAIRMAN GRUNDMANN: Anything else? 4 MEMBER ROSE: Nothing else. 5 CHAIRMAN GRUNDMANN: Thank you, Mr. Bubb. 6 Appreciate it. 7 MR. BUBB: Thank you. 8 CHAIRMAN GRUNDMANN: Thank you. And we're back to 9 Mr. Dowd again. 10 MR. DOWD: I shall try to be fast, although 11 there's a lot to cover. And I can honestly say that I'm 12 actually confused as to the Postal Service's position after 13 this discussion. 14 Mr. Bubb mentions this implicit incorporation of 15 the operational necessary tasks into the ELM. I've never 16 heard of that before. That's a new argument. It's never 17 been raised before by the Postal Service. And Mr. Bubb 18 admits that he doesn't know where it comes from. 19 I believe Mr. Bubb said that the NRP is equivalent 20 to the ELM. The Postal Service has never argued that. And 21 I honestly don't think there's any dispute about that 22 because in each of these cases -- actually in three of the 23 cases the administrative judge analyzed the case under 24 standards that are not consistent with the ELM. So there's 25 really no dispute that the National Reassessment Program is 59 1 inconsistent with the ELM. 2 CHAIRMAN GRUNDMANN: Mr. Bubb raised a point that 3 the ELM never disappeared, never went out the window when 4 the NRP came in. Do you agree with that? 5 MR. DOWD: Absolutely not, Chairman Grundmann. 6 And I think, I don't know, every few people in this room 7 could possibly agree with that because if you look at the 8 administrative judge's decisions they're all based on the 9 fact that the analysis was done according to the NRP, not 10 according to, for example, ELM 546.222 where you actually 11 look for work that may not comprise a complete vacant 12 position. So there's no -- in my mind there's no way that 13 we can argue about this. It's clear, and the Agency has 14 never disputed, that the NRP is inconsistent with its ELM 15 guidelines. 16 On that point, and I think this is a particularly 17 important point, and I know it's a complex issue because you 18 do have these issues about contractual rights and grievances 19 and arbitrations, and the APWU mentioned this and I believe 20 Mr. Bubb mentioned this, but it does need correction. And 21 both attorneys said that the ELM violation is solely a 22 contract violation. As a matter of law that is incorrect 23 because under 39 CFR 211.2 the Postal Service has 24 incorporated into its regulations the provisions of the ELM. 25 So as a matter of law when the Postal Service 60 1 violates ELM provisions, those are regulatory violations. 2 They may also be contractual violations and there might be 3 concurrent jurisdiction, but there's nothing in the law that 4 says two fora can adjudicate the similar or same issues. 5 Now, that being said, I'll also mention that I 6 think the APWU's concerns about the explosion of cases that 7 the Board may experience, well, one, I think it's overblown 8 because I have full confidence in the Board to be able to 9 handle as many cases as it can get. But second, the 10 question isn't whether every violation of the ELM will end 11 up here. It's only whether a violation of the ELM will 12 constitute arbitrary or capricious conduct under 304C. 13 And I think that's -- in our discussion today I 14 think what Mr. Bubb has done a very good job of avoiding is 15 the discussion of what's arbitrary and capricious. And I 16 mentioned these in my opening argument, but the Supreme 17 Court case law is clear. And, in fact, the Circuit Court 18 case law is clear. And it's so clear, for example, the 10th 19 Circuit in Duane v. The Department of Defense, they write, 20 "It is, of course, conventional wisdom that agencies must 21 abide by their own regulations." And the Postal Service has 22 conceded that it has not abided by its regulations as set 23 forth in the ELM. 24 Because of that, that conduct on its face 25 constitutes arbitrary and capricious conduct. So, 61 1 therefore, you have jurisdiction and that finding itself 2 constitutes a violation of the restoration rights of the 3 partially recovered employees. 4 CHAIRMAN GRUNDMANN: I am not sure Mr. Bubb 5 conceded that point because it sounded like that both the 6 ELM and the NRP existed together. 7 MR. DOWD: Well, I may give you that -- 8 CHAIRMAN GRUNDMANN: I'm just -- 9 MR. DOWD: I may give you that -- 10 CHAIRMAN GRUNDMANN: What I heard, sorry. 11 MR. DOWD: -- and maybe that's my confusion 12 because, again, Mr. Bubb has presented new arguments today 13 that haven't been presented in his briefs themselves. I 14 mean, if I understood him correctly he was trying to say 15 that the Postal Service wasn't really trying to invalidate 16 OPM's regulation, but that's exactly what the Postal Service 17 said in their brief. The Postal Service said in their brief 18 that the regulations exceed the statutory authority of OPM. 19 And when you make that argument, that's an ultra vires 20 argument. And the only logical conclusion from that is that 21 the Postal Service is trying to invalidate OPM's regulation. 22 And that goes to another reason -- two more 23 reasons. One, all of this argument by the Postal Service is 24 classic post hoc rationalization. Under the Supreme Court's 25 precedent in Bowen v. Georgetown University Hospital, courts 62 1 can't accept a post hoc rationalization. You have to look 2 at what the Agency did and why they did it. The Agency 3 never instituted the NRP because it believed that OPM's 4 regulation at 353.304C was invalid. That rationalization 5 and that explanation came years later. And because of that, 6 under Bowen and under Chenery, a court can't accept that 7 explanation of Agency conduct. And there's really no 8 question about that. 9 VICE CHAIRMAN WAGNER: Mr. Dowd, can I just ask 10 you, I want a -- 11 MR. DOWD: Sure. 12 VICE CHAIRMAN WAGNER: -- point of clarification. 13 Would you agree that an appellant who comes to us and says 14 that the Postal Service has violated the ELM and, therefore, 15 state a non-frivolous allegation of jurisdiction under 304C, 16 okay, but that may be different? I mean, at that point, I 17 mean, we would have jurisdiction, but would you concede that 18 at that point the Postal Service may be able to come in and 19 say while that may be true, it was a good faith violation, 20 therefore, it's not arbitrary and capricious or it was a de 21 minimis violation? I mean, would you agree that merely 22 being able to make the non-frivolous allegation doesn't 23 necessarily mean you win on the merits? 24 MR. DOWD: I'm not sure I can agree with you, Vice 25 Chairman Wagner. This is a classic administrative law 63 1 problem. And what the courts generally do is when they look 2 at rules and regulations, if an agency violates a regulation 3 set forth in the CFR, that's the end of the story. An 4 agency has to -- and particularly when it's a regulation 5 that protects the rights of individuals, and that's what you 6 have here. 7 VICE CHAIRMAN WAGNER: So you're saying it's a per 8 se. 9 MR. DOWD: It is a per se violation of the rule 10 and, therefore, a per se arbitrary and capricious and, 11 therefore, per se invalid agency conduct. And I think 12 that's clear. 13 And when you look at the Supreme Court case of 14 Vitarelli, when you look at Service v. Dulles, and those 15 cases even go farther, right, because in those cases what 16 the Court found was an invalid agency action not based on a 17 regulation set forth in the CFR, as we have here with the 18 ELM, but as an internal rule. So there the Department of 19 State and the Department of Interior actually set up 20 procedural guidelines to protect employees. In each of 21 those cases the secretary of the respective departments 22 could have summarily dismissed the employees. But what the 23 Court found was that because there were guidelines and 24 regulations set forth to protect those individuals and 25 because the secretary did not comply with those guidelines, 64 1 then those actions were invalid. And I think that is our 2 argument here. 3 And, you know, we could present more evidence that 4 if you look at the rationalization of the NRP, there's 5 another line of cases in admin law that looks under the 6 reasoning, the bases for the agency action, and those are 7 the State Farm cases. And there you sort of -- you look 8 more towards the merits and you look to see whether the 9 agency considered something that Congress didn't want it to 10 consider or you look to see whether the agency failed to 11 consider an important factor. And if the agency goes 12 outright and fails to consider an important factor 13 altogether, that can constitute arbitrary and capricious 14 conduct. And here I don't think we have to -- I don't think 15 the Board has to reach this decision and, in fact, probably 16 shouldn't. And if you get this far, you can send it to the 17 AJ and have them look at it. 18 But here the Agency, in my opinion, has completely 19 failed to consider whether the NRP is consistent with its 20 longstanding policy of protecting partially recovered 21 employees. That's a little separate and distinct from the 22 question of whether the NRP itself on its face violates the 23 regulations. So it's a little more towards the substance. 24 MEMBER ROSE: I was wondering if you would answer 25 the question that I asked Mr. Bubb, that is about when the 65 1 Board has the responsibility to oversee agencies that have 2 violated their procedural rules. And by what legal 3 authority can the Board enforce a substantive right that is 4 not authorized by statute or federal law or regulation? I 5 didn't -- Mr. Bubb said he agreed that -- or he said that we 6 do not have the authority or the juris to do that. So the 7 difference between procedural rules and substantive rights 8 is where I'm stuck and like to have you explain that to me. 9 MR. DOWD: Sure, Member Rose. And I think it ties 10 into a little of what I just discussed. But here I don't 11 think there's any dispute and I don't believe the Postal 12 Service has disputed that the provisions in the ELM provide 13 substantive rights to the employees. So it's not a rule 14 that just governs internal procedure of, you know, how mail 15 is shuttled from one place to another. These are 16 substantive employment rights. So there that's one thing. 17 And the second thing is when you do look at 39 CFR 18 211.2, that explicitly incorporates the ELM provisions into 19 the CFR. So not only do you have here a violation of an 20 agency guideline or manual, if you will, but I believe you 21 have a violation of an agency regulation. It's incorporated 22 into this Code of Federal Regulations. 23 MEMBER ROSE: Thank you. 24 MR. DOWD: Sure. 25 CHAIRMAN GRUNDMANN: Thank you, Mr. Dowd. 66 1 MR. DOWD: Thank you. 2 CHAIRMAN GRUNDMANN: This concludes the oral 3 argument in the appeals of Latham et al. v. U.S. Postal 4 Service. The parties will be given an additional three 5 weeks to brief on specific issues stated in an order that 6 will be issued later on today. The briefing will be 7 simultaneous. The briefs will be filed no later than close 8 of business January 6, 2012, at which point the record will 9 close. 10 The Board thanks counsel and amici for the time 11 and detail they have put into their briefs and their 12 argument today and their collective effort to inform the 13 Board. In particular we thank Mr. Dowd, who contributed his 14 time pro bono in his representation of all five appellants. 15 This hearing is adjourned. 16 (Whereupon, at 1:32 a.m., the 17 PROCEEDINGS were adjourned.) 18 * * * * * 19 20 21 22 23 24 25 67 1 CERTIFICATE OF NOTARY PUBLIC 2 DISTRICT OF COLUMBIA 3 I, Stephen K. Garland, notary public in 4 and for the District of Columbia, do hereby certify 5 that the forgoing PROCEEDING was duly recorded and 6 thereafter reduced to print under my direction; 7 that the witnesses were sworn to tell the truth 8 under penalty of perjury; that said transcript is a 9 true record of the testimony given by witnesses; 10 that I am neither counsel for, related to, nor 11 employed by any of the parties to the action in 12 which this proceeding was called; and, furthermore, 13 that I am not a relative or employee of any 14 attorney or counsel employed by the parties hereto, 15 nor financially or otherwise interested in the 16 outcome of this action. 17 18 19 (Signature and Seal on File) 20 ----------------------------------- 21 Notary Public, in and for the District of Columbia 22 My Commission Expires: May 31, 2014 23 24 25