Closely watched Defense Department personnel case will get rehearing

There was some noteworthy news out of the judiciary today: the U.S. Court of Appeals for the Federal Circuit has thrown out a three-judge panel’s decision from last year that would curtail federal employees’ ability to challenge agencies’ decisions on suitability to hold certain national security jobs. Instead, the full court of about 15 judges will rehear the case, with the first round of briefs due in early March, according to the four-page order.

As Federal Times reported last year, the case dates back to 2009 when Defense Department agencies barred two employees–one a GS-5, the other a GS-7–from  jobs involving access to “sensitive” information. The two sought recourse from the Merit Systems Protection Board, which is charged with hearing appeals of employee firings and other disciplinary measures. But in its 2-1 ruling last August, the appellate panel applied the logic of a 1988 Supreme Court decision that gave deference to agencies when deciding who deserved a security clearance and essentially stripped the MSPB of its ability to take appeals of clearance denials. The same was true for workers who hold “sensitive” positions, even if those jobs don’t involve access to classified information, the panel ruled last year.

In today’s ruling, however, the court signaled its interest in exploring that issue. Among the questions that it wants lawyers on both sides (the Office of Personnel Management is representing the government) to address: “What problems, if any, would the MSPB encounter in determining adverse action appeals for employees holding ‘sensitive’ positions, not requiring a security clearance; to what extent should the agency defer to the agency’s judgment on issues of national security in resolving such adverse action appeals?”

If the government ultimately prevails, federal employee unions and whistleblower advocacy groups worry that the repercussions could go well beyond DoD because agencies not normally considered part of the national security establishment–such as Customs and Border Protection–are making greater use of “sensitive” positions.

But the denouement could be some time off. Kevin Owen, an attorney who practices before the MSPB but is not involved in this case, expected a ruling by the full appellate  court some time late this summer. And whichever way the majority goes, “I don’t think it’s going to be the end of the discussion,” Owen said in an interview, with the losing side likely to appeal to the Supreme Court.

[This post has been updated.]