                     UNITED STATES OF AMERICA
                  MERIT SYSTEMS PROTECTION BOARD


OFFICE OF THE SECRETARY, 1                      DOCKET NUMBER
               Appellant,                       DC-0752-14-0624-I-1

             v.

DEPARTMENT OF DEFENSE,                          DATE: April 14, 2015
            Agency.



        THIS FINAL ORDER IS NO NPRECEDENTIAL 2

      Curtis A. Khol, Vienna, Virginia, pro se.

      Jerome E. Pannullo, Kensington, Maryland, pro se.

      Kevin Greenfield and Steven J. Weiss, Esquire, Washington , D.C., for the
        agency.


                                      BEFORE

                         Susan Tsui Grundmann, Chairman
                            Mark A. Robbins, Member




1
  Our findings in this Final Order apply only to Appellant Curtis A. Khol and Appellant
Jerome E. Pannullo, not to the other appellants who previously were part of the
consolidation in this case. See Dye v. Department of the Army, 121 M.S.P.R. 142, ¶ 1
n.2 (2014).
2
   A nonprecedential order is one that the Board has determined does not add
sign ificantly to the body of MSPB case law. Parties may cite nonprecedential orders,
but such orders have no precedential value; the Board and administrative judges are not
required to follow or distinguish them in any future decisions. In contrast, a
precedential decision issued as an Opinion and Order has been identified by the Board
as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).
                                                                                        2

                                      FINAL ORDER
¶1        The appellants have filed petitions for review of the initial decision, which
     affirmed the agency’s furlough actions.     Generally, we grant petitions such as
     these only when: the initial decision contains erroneous findings of material fact;
     the initial decision is based on an erroneous interpretation of statute or regulation
     or the erroneous application of the law to the facts of the case; the judge’s rulings
     during either the course of the appeal or the initial decision were not consistent
     with required procedures or involved an abuse of discretion, and the resulting
     error affected the outcome of the case; or new and material evidence or legal
     argument is available that, despite the petitioners’ due diligence, was not
     available when the record closed. See Title 5 of the Code of Federal Regulations,
     section 1201.115 (5 C.F.R. § 1201.115). After fully considering the filings in this
     appeal, and based on the following points and authorities, we conclude that the
     petitioners have not established any basis under section 1201.115 for granting
     their petitions for review.   Therefore, we DENY the petitions for review and
     AFFIRM the initial decision, which is now the Board’s final decision in their
     appeals. 5 C.F.R. § 1201.113(b).

                                      BACKGROUND
¶2        The agency furloughed the appellants from their positions in the agency’s
     Office of the Secretary of Defense at the Pentagon for 6 days based on “the
     extraordinary and serious budgetary challenges facing the Department of Defense
     (DOD) for the remainder of Fiscal Year (FY) 2013, the most serious of which is
     the sequester that began on March 1, 2013,” i.e., across-the-board reductions to
     federal budgetary resources caused by the Budget Control Act of 2011, as
     amended by the American Taxpayer Relief Act of 2012.            MSPB Docket No.
     DC-0752-13-1254-I-1 (1254), Initial Appeal File (IAF), Tab 6 at 4-12; MSPB
     Docket No. DC-0752-13-5863-I-1 (5863), IAF, Tab 3 at 4-11.           The appellants
     filed individual appeals challenging the furlough actions, which the Board
                                                                                      3

     consolidated in this case with the appeals of similarly-situated employees. 1254,
     IAF, Tab 1; 5863, IAF, Tab 1; MSPB Docket No. DC-0752-14-0624-I-1 (0624),
     Consolidated Appeal File (CAF), Tab 1.
¶3          In an initial decision based on the written record, the administrative judge
     affirmed the furlough actions. CAF, Tab 17, Initial Decision (ID) at 1, 8. She
     found that the agency’s furlough was a reasonable management solution to the
     shortage of funds caused by sequestration and that the agency established that its
     furlough actions were taken for the efficiency of the service. ID at 2-4, 7. She
     also found that the appellants failed to prove their affirmative defenses. ID at
     4-7.
¶4          The appellants have filed separate petitions for review of the initial
     decision. 1254, Petition for Review (PFR) File, Tab 1; 5863, PFR File, Tab 1.
     The agency has filed a response in opposition to the petitions for review, 0624,
     Consolidated PFR File, Tab 2, to which both appellants have replied, 1254, PFR
     File, Tab 2; 5863, PFR File, Tab 2.

                      DISCUSSION OF ARGUMENTS ON REVIEW
¶5          The appellants primarily argue on review, as they did below, that the
     agency failed to meet its burden of proving a factual basis for the furlough
     because the agency did not suffer from a lack of funds in FY 2013. 1254, IAF,
     Tab 10 at 6-10; 5863, IAF, Tab 4 at 5-14; 1254, PFR File, Tab 1 at 4-8; 5863,
     PFR File, Tab 1 at 4-21. In support of their arguments, they produced several
     documents concerning DOD’s budget, including reports on DOD’s Operation and
     Maintenance Budget for certain quarters of FY 2013 as well as submissions
     regarding the budget for DOD’s Military Programs in FY 2013 and FY 2014.
     1254, IAF, Tab 10 at 34-53, 74-261; 5863, IAF, Tab 4 at 66-125. The appellants
     claim that these documents reveal that the agency had either a projected or a real
     budgetary surplus around the time that DOD took the furlough actions. 1254,
     PFR File, Tab 1 at 4-8; 5863, PFR File, Tab 1 at 4-21. Even if the appellants’
                                                                                      4

     claims concerning a budgetary surplus are accurate, however, they provide no
     basis to disturb the administrative judge’s finding that the agency’s furlough
     promoted the efficiency of the service. ID at 2-4.
¶6         The Board has found that an agency meets its burden of proving that a
     furlough promotes the efficiency of the service by showing, among other things,
     that the furlough was a reasonable management solution to the financial
     restrictions   placed   on   it.     See   Chandler    v.   Department     of   the
     Treasury, 120 M.S.P.R. 163, ¶ 8 (2013). It is undisputed that on March 1, 2013,
     sequestration went into effect across the federal government, which resulted in a
     significant reduction in DOD’s budget.        Washington Headquarter Services
     Administrative Record for FY 2013 Furlough Appeals (WHS Administrative
     Record), available at http://www.mspb.gov/furloughappeals/whs2013.htm (last
     visited March 20, 2015), Tab 1 at 3 (Declaration of the Under Secretary of
     Defense (Comptroller)/Chief Financial Officer of DOD), Tab 3 at 15 (May 14,
     2013 Memorandum from the Secretary of Defense). In addition to sequestration,
     DOD officials attested that a misallocation of funds under a Continuing
     Resolution and unexpectedly high wartime costs led to further budgetary
     constraints on the agency in FY 2013. WHS Administrative Record, Tab 1 at 3-4
     (Declaration of the Under Secretary of Defense (Comptroller)/Chief Financial
     Officer of DOD), Tab 3 at 15 (May 14, 2013 Memorandum from the Secretary of
     Defense). Although the appellants argue that these budgetary constraints did not
     justify the taking of the furlough actions because DOD had a surplus of funds at
     the time, they have set forth no persuasive argument that these budgetary
     constraints on DOD did not, indeed, exist. 1254, PFR File, Tab 1 at 4-8; 5863,
     PFR File, Tab 1 at 4-21.     We therefore find that, irrespective of any alleged
     budgetary surplus, the agency established that it had financial restrictions placed
     on its FY 2013 budget. We further affirm the administrative judge’s finding that
     the furlough was a reasonable management solution to those restrictions. ID at 7.
                                                                                      5

¶7        To the extent that the appellants are arguing that the agency should have
     allocated any surplus funds towards avoiding the furlough, the Board has held
     that its efficiency of the service determination does not encompass agency
     spending decisions per se, including spending on personnel matters. Gajdos v.
     Department of the Army, 121 M.S.P.R. 361, ¶ 11 (2014). Such matters belong to
     the judgment of agency managers, who are in the best position to decide what
     allocation of funding will best allow the agency to accomplish its mission. Id. In
     that regard, to the extent that the appellants are arguing that the Office of the
     Secretary of Defense had sufficient funds to avoid furloughing its employees, we
     find that it was reasonable for DOD to consider its budget situation holistically,
     rather than isolating the financial situation of each of its departments, in making
     its furlough decisions. See Einboden v. Department of the Navy, 2015 MSPB 26,
     ¶ 15; Yee v. Department of the Navy, 121 M.S.P.R. 686, ¶ 14 (2014). Finally, the
     Board will not scrutinize an agency’s furlough decision in such a way that
     second-guesses the agency’s assessment of its mission requirements and
     priorities. Department of Labor v. Avery, 120 M.S.P.R. 150, ¶ 10 (2013), aff’d
     sub nom. Berlin v. Department of Labor, 772 F.3d 890 (Fed. Cir. 2014).
¶8        Appellant Khol additionally challenges the administrative judge’s finding
     that he failed to prove his affirmative defense of harmful procedural error. 1254,
     PFR File, Tab 1 at 8-11. Under 5 U.S.C. § 7701(c)(2)(A), the Board will not
     sustain an agency’s decision if the appellant “shows harmful error in the
     application of the agency’s procedures in arriving at such decision.” On review,
     the appellant argues that the agency committed procedural errors when it did not
     develop specific procedures to implement the FY 2013 furlough and when the
     proposing official did not perform his own analysis of the need to furlough the
     appellant prior to issuing the proposal notice. 1254, PFR File, Tab 1 at 8-11.
     The appellant, however, has not identified any rule or regulation that he believes
     the agency violated when taking these actions and we otherwise find no
                                                                                        6

procedural errors in this regard. 3 Moreover, assuming arguendo that the agency
did commit procedural errors as alleged, the appellant has not attempted to show
that the agency was likely to have reached a different decision on the proposed
furlough action had the errors either been cured or not occurred. See Schnedar v.
Department of the Air Force, 119 M.S.P.R. 246, ¶ 12 (2013). We therefore find
no basis to disturb the administrative judge’s finding that the appellant failed to
prove his harmful procedural error claim. ID at 4-7.

                 NOTICE TO THE APPELLANT REGARDING
                    YOUR FURTHER REVIEW RIGHTS
      You have the right to request review of this final decision by the United
States 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

3
  In his petition for review, the appellant alleges that the agency violated guidance that
it provided in response to frequently asked questions on the Washington Headquarters
Services website regarding the FY 2013 furlough. 1254, PFR File, Tab 1 at 8-10. Even
if the gu idance provided in response to these questions equated to procedures that the
agency was required to follow, we find that the appellant has not shown any error in the
agency’s application of said guidance. See http://www.whs.mil/furlough-overview/
furlough-faqs (last visited March 20, 2015).
                                                                               7

Title 5 of the United States 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 United
States   Code,    at   our     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 your court
appeal, you may visit our website at http://www.mspb.gov/probono for a list of
attorneys who have expressed interest in providing pro bono representation for
Merit Systems Protection Board appellants before the court. 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.
