                           UNITED STATES OF AMERICA
                        MERIT SYSTEMS PROTECTION BOARD
                                       2016 MSPB 7

                               Docket No. DA-0752-15-0054-I-1

                                     Patrick W. Ryan,
                                        Appellant,
                                             v.
                             Department of Homeland Security,
                                          Agency.
                                      February 4, 2016

           Christopher D. Vaughn, Esquire, Decatur, Georgia, for the appellant.

           Gregory Scott Dowling, Esquire, Washington, D.C., for the agency.

                                         BEFORE

                               Susan Tsui Grundmann, Chairman
                                  Mark A. Robbins, Member



                                  OPINION AND ORDER

¶1         The appellant has filed a petition for review of the initial decision, which
     affirmed the agency’s action suspending him for 30 days.         For the reasons
     discussed below, we GRANT the appellant’s petition for review and REVERSE
     the initial decision.

                                      BACKGROUND
¶2         The appellant is a Program Analyst with the agency’s Federal Emergency
     Management Agency (FEMA) in the Texas National Processing Service Center.
     Initial Appeal File (IAF), Tab 4 at 31-32. The appellant works in the Contract
     Oversight Management Section, and his duties previously included being a
                                                                                         2

     Contracting Officer Representative.        Id. at 89, 196-210.     The appellant was
     assigned to conduct market research on call centers in the Dallas/Fort Worth area
     beginning in May 2013. IAF, Tab 5 at 35. The appellant also was assigned to
     conduct market research on bilingual call centers nationwide from July to
     September 2013. Id. at 42.
¶3            On September 4, 2013, the appellant sent an email to his supervisor stating
     that his wife’s company was working on a joint venture with a call center that
     would compete for a contract. Id. at 45. The appellant also sent an email to one
     of the agency’s ethics counselors on September 4, 2013, stating that he was the
     president of his wife’s company, Texas Based Acquisitions (TBA), and wanted to
     know if a conflict of interest existed that would preclude TBA from competing
     for the agency’s call center contract and, if so, how long of a period would need
     to pass before TBA could compete. Id. at 144. The appellant also asked whether
     any conflict of interest existed if TBA did business with agencies within the
     Department of Homeland Security other than FEMA. Id.
¶4            After these inquiries, the agency recused the appellant from his duties
     related to the agency’s call center project and investigated his outside activities,
     including obtaining a sworn statement from the appellant.            Id. at 19-29, 95,
     146-48. In his sworn statement, the appellant stated that TBA had not pursued
     any involvement with a contact center but that there had been internal discussions
     about joint venturing with a bilingual contact center in the future once the
     appellant retired from FEMA and the appropriate amount of time had passed to
     avoid a potential conflict of interest. Id. at 146-47.
¶5            The agency proposed to remove the appellant based on five charges:
     (1) “Ethics Violations, including Apparent Conflict of Interest”; (2) failure to
     report     an    offense,   status,   or   relationship;     (3)   lack   of   candor;
     (4) misrepresentation; and (5) sleeping on duty.           IAF, Tab 5 at 4-12.    The
     deciding official sustained only the first two charges and suspended the appellant
     for 30 days.     IAF, Tab 4 at 32-35.      The appellant appealed his suspension,
                                                                                       3

     arguing that the agency had insufficient evidence to support the sustained
     charges. IAF, Tab 1. The appellant requested a decision without a hearing. IAF,
     Tab 9.
¶6            The appellant argued that charge 1 contained five independent charges,
     each of which the agency had to prove to sustain the charge. IAF, Tab 14 at 8-13.
     The appellant also argued that the agency could not prove the charges because
     TBA did not begin internal discussions regarding the possibility of bidding for
     call center contracts until after the appellant completed his market research
     assignments and notified the agency about the potential conflict of interest. Id.
     at 2-5, 13-16. The administrative judge issued an initial decision, finding that the
     agency had proven charges 1 and 2, and affirming the 30-day suspension. IAF,
     Tab 17, Initial Decision (ID).
¶7            The appellant has filed a petition for review, which consists mainly of the
     arguments he made below.            Compare Petition for Review (PFR) File,
     Tab 1 at 10-19, with IAF, Tab 14 at 8-16. The agency has filed an opposition to
     the appellant’s petition for review. PFR File, Tab 4.

                                          ANALYSIS
     The agency provided the appellant with adequate notice of the misconduct
     charged.
¶8            The appellant argues that charge 1 is ambiguous and unspecific. PFR File,
     Tab 1 at 10-11.      Due process mandates that notice of charges be sufficiently
     detailed to provide a meaningful opportunity to reply.        Rawls v. U.S. Postal
     Service, 94 M.S.P.R. 614, ¶¶ 19-21 (2003), aff’d, 129 F. App’x 628 (Fed. Cir.
     2005).      We find that the appellant was provided adequate notice of the
     misconduct charged to provide a meaningful response.
¶9            The agency charged the appellant with “Ethics Violations, including
     Apparent Conflict of Interest.” IAF, Tab 5 at 4. The notice of proposed removal
     further described his alleged misconduct in narrative form, and stated that the
     specified action “constituted ethics violations, including reasonably creating the
                                                                                           4

      appearance of a conflict of interest, loss of impartiality, use of public office for
      private gain, and improper use of nonpublic information.” 1 Id. at 4-5. We find
      that the notice of proposed removal was sufficiently detailed to allow for a
      meaningful response because it specified both the appellant’s relevant conduct
      and types of ethical violations. Moreover, the appellant filed a thorough reply to
      the proposed removal. IAF, Tab 4 at 41-46; see Yinat v. Department of the Army,
      101 M.S.P.R. 328, ¶ 15 (2005) (stating that, where an appellant comes forward
      and refutes a charge made against him, the Board cannot find that he was not
      given notice of the charge).     Thus, we find that the proposal was sufficiently
      specific and detailed.
¶10         The administrative judge sustained charge 1 based on her finding that the
      appellant’s actions “created an appearance of a conflict of interest and a loss of
      impartiality.” ID at 12-14. The appellant argues that charge 1 specifies several
      additional types of ethical violations that the agency was required to prove to
      sustain the charge. PFR File, Tab 1 at 11. We agree with the administrative
      judge’s finding that the agency was not required to prove that the appellant’s
      conduct violated all of the ethics rules listed in the specifications to sustain the
      charge.    ID at 13 n.4; see Suarez v. Department of Housing & Urban
      Development, 96 M.S.P.R. 213, ¶¶ 20-39 (2004) (sustaining a charge that the
      appellant violated standards of ethical conduct, even though the agency did not




      1
        The notice of proposed removal states that the action is being taken in accordance
      with 5 C.F.R. part 2635 and refers to these regulatory standards. IAF, Tab 5 at 4-9.
      These regulations set forth Government-wide standards of ethical conduct, and
      specifically address all of the types of ethical violations mentioned in the notice of
      proposed removal: a conflict of interest, impartiality, using public office for private
      gain, improper use of nonpublic information, and engaging in actions that create the
      appearance of a violation of ethical standards. 5 C.F.R. §§ 2635.101(b), 2635.402,
      2635.501-502, 2635.702-703.
                                                                                              5

      prove all of the specified types of ethical violations), aff’d, 125 F. App’x 1010
      (Fed. Cir. 2005). Thus, the agency’s charge does not fail on this basis. 2
¶11         The appellant also argues that, although charge 1 is labeled “apparent”
      conflict of interest, the agency was required to prove that an actual conflict of
      interest existed because the specifications describe an actual conflict of interest.
      PFR File, Tab 1 at 14. This argument is unavailing. The notice of proposed
      removal accused the appellant of, among other things, “reasonably creating the
      appearance of a conflict of interest.” IAF, Tab 5 at 4, 9. Creating the appearance
      of an ethical violation is a violation of the Standards of Conduct for Employees
      of the Executive Branch. 5 C.F.R. § 2635.101(b)(14). Thus, the agency could
      prove its charge by establishing that the appellant’s conduct created the
      appearance of a conflict of interest under the standards of ethical conduct, even if
      it failed to prove an actual conflict of interest.
      The agency has not proven that the appellant’s outside activities on behalf of
      TBA created the appearance of a conflict of interest or loss of impartiality; thus,
      charge 1 cannot be sustained.
¶12         To prove the existence of a conflict of interest, an agency must establish
      that its employee was acting in two separate capacities, at least one of which
      involved his official duties and that the nature of his interests or duties in one
      capacity had a “direct and predictable effect” on his interests or duties in his
      other capacity.     Fontes v. Department of Transportation, 51 M.S.P.R. 655,


      2
        The agency did not file a cross petition for review on any issues and argues that the
      Board should sustain charge 1 based on evidence establishing that the appellant’s
      actions created the appearance of a conflict of interest. PFR File, Tab 4 at 8-15. The
      agency argues that it was not required to prove each type of ethics violation specified in
      the proposal notice, and it makes no argument on review that it has done so. Id. at 9.
      Absent any argument from the agency, we will not address whether the appellant
      misused, or appeared to misuse, nonpublic information or his public office for private
      gain, although these matters were mentioned in the notice of proposed removal. IAF,
      Tab 5 at 4-5; see 5 C.F.R. § 1201.115 (the Board normally will consider only issues
      raised in a timely filed petition or cross petition for review).
                                                                                          6

      663 (1991); see 5 C.F.R. §§ 2635.401-.402.          To prove the existence of an
      appearance of a conflict of interest, an agency must show that the employee’s
      interests or duties in one capacity would “reasonably create an appearance” of
      having an effect on his interests or duties in the other capacity.            Fontes,
      51 M.S.P.R. at 664. If an employee knows that a matter is likely to have a direct
      and predictable effect on the financial interest of a member of his household or
      knows that a person with whom he has a covered relationship is a party to the
      matter, and the employee determines that the circumstances would cause a
      reasonable person with knowledge of the relevant facts to question his
      impartiality in the matter, the employee should not participate in the matter
      unless he has received authorization from the agency to participate.         5 C.F.R.
      § 2635.502(a).   “A particular matter will have a direct effect on a financial
      interest if there is a close causal link” between the action to be taken in the matter
      and “any expected effect of the matter on the financial interest.”          5 C.F.R.
      § 2635.402(b)(1).    A particular matter will not have a direct effect on the
      financial interest “if the chain of causation is attenuated or is contingent upon the
      occurrence of events that are speculative or that are independent of . . . the
      matter.” Id.
¶13         “Employees shall endeavor to avoid any actions creating the appearance
      that they are violating . . . ethical standards.”      5 C.F.R. § 2635.101(b)(14).
      “Whether particular circumstances create an appearance that ethical standards
      have been violated shall be determined from the perspective of a reasonable
      person with knowledge of the relevant facts.”           Id.   Fundamental fairness
      precludes disciplining an employee for creating the appearance of an ethical
      violation unless he should have known it would appear improper to a reasonable
      observer under the circumstances. Special Counsel v. Nichols, 36 M.S.P.R. 445,
      455 (1988).
¶14         The agency has not produced sufficient evidence to support the conclusion
      that TBA was involved in call centers while the appellant was conducting market
                                                                                         7

      research into call centers except for internal discussions amongst TBA’s officers
      to determine if this idea was feasible. IAF, Tab 5 at 146-47. We agree with the
      administrative judge’s finding that the market research the appellant conducted
      on behalf of the agency concerning both local call centers and bilingual call
      centers nationwide gave him access to information about these businesses he
      would not have had in his personal capacity as the president of TBA.              ID
      at 12-14. However, the appellant asked for ethics guidance about TBA’s intended
      future activities before utilizing that information.     IAF, Tab 4 at 89.       The
      conclusion that TBA would have used this information even after the appellant
      received a response is too speculative to support the conclusion that a reasonable
      person would believe he violated the Government-wide standards of ethical
      conduct.
¶15         We find no evidence in the record to support the agency’s conclusion that
      TBA made contact with call centers regarding a joint venture prior to the
      appellant notifying his supervisor and the agency ethics counselor about his
      outside activities. PFR File, Tab 4 at 11. The agency is relying entirely on the
      appellant’s email to support this conclusion. Id. However, in this same email,
      the appellant stated that he had not spoken to any call center regarding any effort
      on a solicitation by the Government and that all of his work on behalf of TBA
      was focused on landscaping and grounds maintenance. IAF, Tab 5 at 94. In this
      email, the appellant also stated that he had conversations with small businesses
      focused on “general interest in joint venturing,” but he did not specify that these
      conversations concerned call center services.          Id.   During the agency’s
      investigation into this matter, the appellant further clarified that TBA had not
      pursued any involvement with a call center for the purposes of pursuing a
      Government contract and that there only had been internal conversations
      concerning a joint venture with a bilingual call center in the future. Id. at 146-47.
      The agency only became aware of the appellant’s outside activities because he
                                                                                         8

      sought guidance from his supervisor and the agency’s ethics counselor about any
      potential conflict of interest. Id. at 106-08.
¶16            Cause under 5 U.S.C. § 7513 generally connotes some action or omission
      on the part of an employee.       Gonzalez v. Department of Homeland Security,
      114 M.S.P.R. 318, ¶ 10 (2010). The Board consistently has found that creating
      the appearance of an ethical violation requires some action by the employee. See,
      e.g., Burnett v. U.S. Soldiers’ & Airmen’s Home, 13 M.S.P.R. 311, 313-15 (1982)
      (finding that the appellant created the appearance of using his public office for
      private gain by cashing checks belonging to a resident over a 1-year period);
      Moffer v. Department of the Interior, 8 M.S.P.R. 453, 455-57 (1981) (finding that
      an employee created the appearance that he had used his public office for private
      gain by purchasing land from a prohibited seller), aff’d, 690 F.2d 1037 (D.C. Cir.
      1982).
¶17            The evidence establishes that once the appellant began considering a future
      plan for TBA to participate in Government contracts related to call center service,
      he raised the matter with agency officials. IAF, Tab 4 at 89, Tab 5 at 146-47.
      However, there is insufficient evidence of any action taken by the appellant or
      TBA that would support a finding that his conduct created the appearance of a
      conflict of interest or the appearance that he lost his impartiality. Cf. Wilson v.
      Department of Justice, 66 M.S.P.R. 287, 297 (1995) (holding that charge of
      encouraging illegal sick leave use could not be sustained where there was no
      suggestion that the officer persuaded others to call in sick or that anyone acted on
      his statements); Capozzella v. Federal Bureau of Investigation, 11 M.S.P.R. 552,
      557 (1982) (stating that a charge related solely to an employee’s thought process
      cannot be considered misconduct). Because we have found insufficient evidence
      to support the conclusion that the appellant took action to advance TBA’s interest
      in bidding for call center or bilingual call center contracts prior to seeking advice
      from the agency’s ethics counselor, we find that there is insufficient evidence to
                                                                                          9

      support the conclusion that the appellant’s actions created the appearance of a
      conflict of interest or the loss of impartiality. 3
      The agency has not established that the appellant was required to report his
      outside activities prior to September 4, 2013; thus, charge 2 is not sustained.
¶18         The agency also charged the appellant with failure to report an offense,
      status, or relationship.    IAF, Tab 5 at 5.      This charge was supported by two
      specifications.     Id.    The administrative judge did not sustain the first
      specification, which alleged that the appellant began exploring the idea of
      seeking Government contracts for call center service on behalf of TBA prior to
      May 9, 2013. ID at 14-15. The administrative judge found that the agency failed
      to present sufficient evidence to support a finding that the appellant began to
      explore the idea of seeking Government contracts for call center service before he
      was assigned to conduct market research on call centers for the agency, and
      therefore the first specification could not be sustained.       Id.   We agree.   The
      second specification cannot be sustained for similar reasons.
¶19         The second specification is that on December 12, 2013, the appellant stated
      to an agency investigator that he did not notify anyone in his supervisory chain or
      an agency ethics counselor about his status as an officer of, or his financial
      interest in, TBA because TBA’s interest was in bilingual call centers only. IAF,
      Tab 5 at 5.   The administrative judge found this an insufficient reason for the
      appellant’s failing to provide notice about his outside activities. ID at 15-16.
      However, the agency has not shown that the appellant had an obligation to report
      his outside activities.
¶20         Employees are required to obtain prior approval before engaging in outside
      activities including employment when required by agency supplemental ethics

      3
       Given this finding, we need not examine whether the agency’s action of proposing the
      charge under the circumstances would have a chilling effect on employees seeking
      advice from the agency’s ethics officer or whether the appellant would have been
      protected by the safe harbor provision of any ethics law, rule, or regulation.
                                                                                         10

      regulations. 5 C.F.R. § 2635.803. The agency has not submitted any evidence or
      argument establishing that it has a regulation requiring that employees obtain
      prior approval before engaging in all outside activities. The agency instead relies
      on a portion of its ethics training concerning the Government-wide standards of
      ethical conduct, specifically financial conflicts of interest. ID at 15; IAF, Tab 4
      at 9. The applicable regulation requires that an employee who becomes aware of
      the need to be disqualified from participating in a matter due to a financial
      conflict of interest should notify the person responsible for assigning him to the
      matter.   5 C.F.R. § 2635.402(c)(1).       An employee is required to disqualify
      himself from matters that will have a direct and predictable effect on his interests
      or any person whose interests are imputed to him. 5 C.F.R. § 2635.402(a)-(b). A
      matter will have a predictable effect if there is a real, as opposed to a speculative,
      possibility that the matter will affect the financial interest. Id.
¶21         The agency has not produced sufficient evidence to support a finding that
      the appellant should have disqualified himself from the market research project
      prior to when he reported his outside activities to his supervisor and an agency
      ethics official on September 4, 2013. TBA incorporated on July 9, 2013. IAF,
      Tab 4 at 47.      The appellant states that TBA’s primary business focus is
      landscaping, grounds maintenance, and housekeeping services.             IAF, Tab 5
      at 146-47.     The appellant’s statement is corroborated by his supervisor’s
      description of his conversations with the appellant about TBA’s work in grounds
      maintenance on military facilities. Id. at 110. According to the appellant, TBA
      began considering the possibility of getting involved in Government contracts
      related to call center services at the end of August 2013. IAF, Tab 14, Exhibit
      (Ex.) 1 at 3-4. The appellant anticipated retiring by August 28, 2013. IAF, Tab 4
      at 81-84, Tab 5 at 147. On August 28, 2013, the appellant asked his supervisor
      how long after retiring he would need to wait before working on a Government
      contract, and his supervisor referred him to an agency ethics counselor. IAF,
      Tab 4 at 68.
                                                                                          11

¶22         On September 4, 2013, the appellant’s supervisor asked him to continue his
      work on the agency’s anticipated procurement of call center services.              IAF,
      Tab 5 at 45.   In response, the appellant asked to be recused and notified his
      supervisor of the potential conflict of interest because TBA was working on a
      joint venture with a call center. Id. The appellant subsequently clarified that the
      bilingual call center that TBA was considering entering into a joint venture with
      was the same call center where his sister-in-law worked. IAF, Tab 14, Ex. 1 at 3.
      The record indicates that the appellant had no contact with this bilingual call
      center prior to notifying his supervisor and the agency ethics counselor of the
      potential conflict of interest. Id. at 4. In the email the appellant sent to the
      agency ethics counselor on September 4, 2013, he erroneously states that the
      bilingual call center is located in El Paso, Texas. IAF, Tab 4 at 89. Until his trip
      to El Paso and discussion with his sister-in-law, the appellant was not even aware
      that the call center is located in Juarez, Mexico, and thus, being outside the
      United States, is ineligible for a Government contract. IAF, Tab 14, Ex. 1 at 3-4.
      We find that the appellant’s plan to involve TBA in bidding for call center or
      bilingual call center contracts had not progressed to the point that it triggered an
      obligation to disqualify himself from the market research project and notify his
      supervisor prior to September 4, 2013. Based on the foregoing, we conclude that
      the agency has not proven charge 1 or charge 2, and its action suspending the
      appellant must be cancelled.

                                            ORDER
¶23         We ORDER the agency to cancel the 30-day suspension.              See Kerr v.
      National Endowment for the Arts, 726 F.2d 730 (Fed. Cir. 1984). The agency
      must complete this action no later than 20 days after the date of this decision.
¶24         We also ORDER the agency to pay the appellant the correct amount of
      back pay, interest on back pay, and other benefits under the Back Pay Act and/or
      Postal Service Regulations, as appropriate, no later than 60 calendar days after
                                                                                      12

      the date of this decision. We ORDER the appellant to cooperate in good faith in
      the agency’s efforts to calculate the amount of back pay, interest, and benefits
      due, and to provide all necessary information the agency requests to help it carry
      out the Board’s Order. If there is a dispute about the amount of back pay, interest
      due, and/or other benefits, we ORDER the agency to pay the appellant the
      undisputed amount no later than 60 calendar days after the date of this decision.
¶25         We further ORDER the agency to tell the appellant promptly in writing
      when it believes it has fully carried out the Board’s Order and to describe the
      actions it took to carry out the Board’s Order. The appellant, if not notified,
      should ask the agency about its progress. See 5 C.F.R. § 1201.181(b).
¶26         No later than 30 days after the agency tells the appellant that it has fully
      carried out the Board’s Order, the appellant may file a petition for enforcement
      with the office that issued the initial decision in this appeal if the appellant
      believes that the agency did not fully carry out the Board’s Order. The petition
      should contain specific reasons why the appellant believes that the agency has not
      fully carried out the Board’s Order, and should include the dates and results of
      any communications with the agency. 5 C.F.R. § 1201.182(a).
¶27         For agencies whose payroll is administered by either the National Finance
      Center of the Department of Agriculture (NFC) or the Defense Finance and
      Accounting Service (DFAS), two lists of the information and documentation
      necessary to process payments and adjustments resulting from a Board decision
      are attached. The agency is ORDERED to timely provide DFAS or NFC with all
      documentation necessary to process payments and adjustments resulting from the
      Board’s decision in accordance with the attached lists so that payment can be
      made within the 60-day period set forth above.
¶28         This is the final decision of the Merit Systems Protection Board in this
      appeal. Title 5 of the Code of Federal Regulations, section 1201.113(c) (5 C.F.R.
      § 1201.113(c)).
                                                                                 13

                       NOTICE TO THE APPELLANT
                   REGARDING YOUR RIGHT TO REQUEST
                       ATTORNEY FEES AND COSTS
      You may be entitled to be paid by the agency for your reasonable attorney
fees and costs. To be paid, you must meet the requirements set out at title 5 of
the U.S. Code (U.S.C.), sections 7701(g), 1221(g), 1214(g) or 3330c(b); or
38 U.S.C. § 4324(c)(4). The regulations may be found at 5 C.F.R. §§ 1201.201,
1202.202, and 1201.203. If you believe you meet these requirements, you must
file a motion for attorney fees WITHIN 60 CALENDAR DAYS OF THE DATE
OF THIS DECISION. You must file your attorney fees motion with the office
that issued the initial decision on your appeal.

                  NOTICE TO THE APPELLANT REGARDING
                     YOUR FURTHER REVIEW RIGHTS
      You have the right to request review of this final decision by the U.S.
Court of Appeals for the Federal Circuit. You must submit your request to the
court at the following address:
                          United States Court of Appeals
                              for the Federal Circuit
                            717 Madison Place, N.W.
                             Washington, DC 20439

The court must receive your request for review no later than 60 calendar days
after the date of this order. See 5 U.S.C. § 7703(b)(1)(A) (as rev. eff. Dec. 27,
2012). If you choose to file, be very careful to file on time. The court has held
that normally it does not have the authority to waive this statutory deadline and
that filings that do not comply with the deadline must be dismissed. See Pinat v.
Office of Personnel Management, 931 F.2d 1544 (Fed. Cir. 1991).
      If you need further information about your right to appeal this decision to
court, you should refer to the Federal law that gives you this right. It is found in
title 5 of the U.S. Code, section 7703 (5 U.S.C. § 7703) (as rev. eff. Dec. 27,
2012). You may read this law as well as other sections of the U.S. Code, at our
                                                                                 14

website, http://www.mspb.gov/appeals/uscode/htm.        Additional information is
available at the court’s website, www.cafc.uscourts.gov. Of particular relevance
is the court’s “Guide for Pro Se Petitioners and Appellants,” which is contained
within the court’s Rules of Practice, and Forms 5, 6, and 11.
      If you are interested in securing pro bono representation for an appeal to
the U.S. Court of Appeals for the Federal Circuit, you may visit our website at
http://www.mspb.gov/probono for information regarding pro bono representation
for Merit Systems Protection Board appellants before the Federal Circuit. The
Merit Systems Protection Board neither endorses the services provided by any
attorney nor warrants that any attorney will accept representation in a given case.



FOR THE BOARD:


______________________________
William D. Spencer
Clerk of the Board
Washington, D.C.
                                                     DFAS CHECKLIST
                                      INFORMATION REQUIRED BY DFAS IN
                                     ORDER TO PROCESS PAYMENTS AGREED
                                       UPON IN SETTLEMENT CASES OR AS
                                        ORDERED BY THE MERIT SYSTEMS
                                             PROTECTION BOARD
     AS CHECKLIST: INFORMATION REQUIRED BY IN ORDER TO PROCESS PAYMENTS AGREED UPON IN SETTLEMENT
                                                 CASES
     CIVILIAN PERSONNEL OFFICE MUST NOTIFY CIVILIAN PAYROLL
         OFFICE VIA COMMAND LETTER WITH THE FOLLOWING:

     1. Statement if Unemployment Benefits are to be deducted, with dollar amount, address
            and POC to send.
     2. Statement that employee was counseled concerning Health Benefits and TSP and the
            election forms if necessary.
     3. Statement concerning entitlement to overtime, night differential, shift premium,
            Sunday Premium, etc, with number of hours and dates for each entitlement.
     4. If Back Pay Settlement was prior to conversion to DCPS (Defense Civilian Pay
            System), a statement certifying any lump sum payment with number of hours and
            amount paid and/or any severance pay that was paid with dollar amount.
     5. Statement if interest is payable with beginning date of accrual.

     6. Corrected Time and Attendance if applicable.

        ATTACHMENTS TO THE LETTER SHOULD BE AS FOLLOWS:
1. Copy of Settlement Agreement and/or the MSPB Order.
2. Corrected or cancelled SF 50's.
3. Election forms for Health Benefits and/or TSP if applicable.
4. Statement certified to be accurate by the employee which includes:
      a. Outside earnings with copies of W2's or statement from employer.
       b. Statement that employee was ready, willing and able to work during the period.
       c. Statement of erroneous payments employee received such as; lump sum leave, severance
       pay, VERA/VSIP, retirement annuity payments (if applicable) and if employee withdrew
       Retirement Funds.
5. If employee was unable to work during any or part of the period involved, certification of the
type of leave to be charged and number of hours.
NATIONAL FINANCE CENTER CHECKLIST FOR BACK PAY CASES
Below is the information/documentation required by National Finance Center to process
payments/adjustments agreed on in Back Pay Cases (settlements, restorations) or as
ordered by the Merit Systems Protection Board, EEOC, and courts.
1. Initiate and submit AD-343 (Payroll/Action Request) with clear and concise
information describing what to do in accordance with decision.
2. The following information must be included on AD-343 for Restoration:
   a. Employee name and social security number.
   b. Detailed explanation of request.
   c. Valid agency accounting.
   d. Authorized signature (Table 63)
   e. If interest is to be included.
   f. Check mailing address.
   g. Indicate if case is prior to conversion. Computations must be attached.
   h. Indicate the amount of Severance and Lump Sum Annual Leave Payment to
be collected. (if applicable)
Attachments to AD-343
1. Provide pay entitlement to include Overtime, Night Differential, Shift Premium, Sunday
Premium, etc. with number of hours and dates for each entitlement. (if applicable)
2. Copies of SF-50's (Personnel Actions) or list of salary adjustments/changes and
amounts.
3. Outside earnings documentation statement from agency.
4. If employee received retirement annuity or unemployment, provide amount and address
to return monies.
5. Provide forms for FEGLI, FEHBA, or TSP deductions. (if applicable)
6. If employee was unable to work during any or part of the period involved, certification of
the type of leave to be charged and number of hours.
7. If employee retires at end of Restoration Period, provide hours of Lump Sum Annual
Leave to be paid.
NOTE: If prior to conversion, agency must attach Computation Worksheet by Pay
Period and required data in 1-7 above.
The following information must be included on AD-343 for Settlement Cases: (Lump
Sum Payment, Correction to Promotion, Wage Grade Increase, FLSA, etc.)
   a. Must provide same data as in 2, a-g above.
   b. Prior to conversion computation must be provided.
   c. Lump Sum amount of Settlement, and if taxable or non-taxable.
If you have any questions or require clarification on the above, please contact NFC’s
Payroll/Personnel Operations at 504-255-4630.
