The Office of Special Counsel is “deeply concerned” about the implications of a federal court ruling that stripped low-level Defense Department employees of their ability to appeal suspensions and demotions outside the agency.

OSC, which filed an amicus brief earlier this month with the U.S. Court of Appeals for the Federal Circuit, is worried the ruling could have a chilling effect on whistleblowers.

That’s because the ruling, if upheld, would also deny OSC the ability to investigate claims of retaliation against national-security whistleblowers, according to Adam Miles, OSC’s director of policy and congressional affairs.

The Circuit Court’s ruling “would mean that any time a whistleblower lost his eligibility to hold a sensitive position, even in one of these very low-level positions, they wouldn’t be able to raise a whistleblower defense,” he said in an interview on The Federal Drive with Tom Temin and Emily Kopp. “And so it’s an option for agencies … to circumvent the whistleblower law by stripping employees of their right to hold a sensitive position.”

Ruling cut MSPB review

The case deals with two relatively low-level DoD employees, deemed “non-critical sensitive” employees, who were not in fact whistleblowers.

One employee stocked shelves at a DoD commissary and the other worked as an accounting technician for the Defense Finance and Accounting Service. Both suffered adverse personnel actions after credit checks turned up negative information in their respective credit histories and they were deemed no longer eligible to hold their positions, Miles said.

“Typically, when those types of adverse actions happen to employees, they can appeal the case to the Merit Systems Protection Board,” Miles said. And that’s exactly what the two employees did.

But DoD and the Office of Personnel Management argued because the employees were employed in sensitive positions, they shouldn’t be able to appeal their cases outside DoD.

The ensuing court case resulted in a decision by the Federal Circuit Court in August 2012, which held that most personnel decisions regarding national-security employees cannot be independently appealed outside the agency.

Agencies could circumvent whistleblower laws

While the case at hand doesn’t deal specifically with retaliation against whistleblowers, OSC is concerned the court’s ruling shuts down its ability to conduct independent reviews when employees allege retaliation for blowing the whistle.

“The bottom line is, we’re very concerned that agencies, if this ruling were upheld, would be able to circumvent the new rights, the new protections available to whistleblowers by taking away eligibility to hold a sensitive position,” Miles said. “We think it’s unjustified in the case at hand, and it’s unnecessary because OSC and the MSPB, frankly, are fully within their competence and ability to look at cases involving sensitive employees and determine if those eligibility determinations were justified or if they were improper because an employee blew the whistle.”

The case, which the entire 15-judge Federal Circuit will re-hear, has exposed another shortfall in whistleblower protections for some federal employees.

Last fall, the White House issued a directive to boost protections for national-security whistleblowers, aiming to bridge a “longstanding gap” in whistleblower protections for federal employees who hold security clearances, Miles said.

However, the directive didn’t cover lower-level employees whose positions aren’t sensitive enough to require clearances, Miles said.

“So you set up a whole new system for employees in very sensitive positions; you have the existing protections, the ones that OSC and the MSPB enforce; and then you would have a hole for the commissary worker in this case, the person who’s stocking the shelves at base commissaries, and he wouldn’t have any rights — either under the laws that OSC enforces or the new presidential directive.”

OSC’s authority to file amicus briefs in court cases was granted by the Whistleblower Protection Enhancement Act, which Congress approved last fall after a decade of legislative effort.

The new law, hailed by whistleblower advocates, was, in part, prompted by previous Federal Circuit rulings “that had undermined the scope of whistleblower protections,” Miles said.

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