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Insight by Mike Causey: A small matter of the law

The purpose of sequestration—when and if it happens—is to self-destruct. It was a never-to-be-activated Frankenstein's Monster designed to scare politicians into agreeing on spending cuts and new revenue sources. It was never supposed to happen. But as the March deadline approached, a new wrinkle appeared in the form of the government's in-house equal employment opportunity and adverse action appeals systems which, some critics say, could cost Uncle Sam a bundle in time, awards and attorneys fees. So how might this happen?


When Congress and the White House agreed to the sequestration process, neither side (they both now claim) expected it to happen. It was a poison pill. Democrats figured it would force Republicans to accept tax increases. Republicans hoped it would force Democrats to sign off on cuts in entitlement programs.

Sequestration, with $1.3 trillion of across-the-board cuts, was intended to be so objectionable, so unfair and so stupid that the politicians who created it would abort it in favor of targeted cuts in entitlements, and targeted tax increases. The furloughs that would accompany sequestration were aimed at inflaming the public because they would cut into services, hamper national defense, impact the airlines and food safety. Too horrible to contemplate.

Before the 2012 presidential election, administration officials told agencies to downplay talk of sequestration and service-cutting furloughs. The Labor Department told defense contractors that the mandatory 60-day furlough alert letters they were supposed to send out—by law—really didn't need to be mailed. Labor offered to pay any fines or court costs contractors had if there was a backlash to not sending out the alerts.

Now that sequestration is upon us—and Congress took a six-day vacation—the White House has told departments and agencies to publicize their worst-case scenarios. DOD says it will furlough between 700,000 and 800,000 civilians one day a week for up to 22 days. Justice has warned that law enforcement operations (like the FBI) will be hard hit. Agriculture says food inspections could be slowed to the point where some processors might go out of business. Interior says it may have to shutter some national parks. The White House says hundreds of thousands of private-sector jobs will disappear and unemployment will jump if sequestration happens.

Other stuff could happen, too. Washington-based lawyers who specialize in federal personnel matters are salivating at the prospect of furloughs caused by sequestration. Can you say Equal Employment Opportunity Commission and Merit Systems Protection Board claims?

The sequestration-triggered furloughs would be the first under new guidelines which seem to permit unlimited awards claims the government would have to pay out if the EEOC or MSPB ruled they had discriminated against, or treated some employees unfairly and illegally. Previously the cap for such awards and the all-important legal fees that come with them had been $300,000.

At $10,000 to $15,000 a pop to process cases that take an average of four months, according to one legal specialist, the government could be flooded by cases brought by employees who don't want to get furloughed.

Under the so-called "protected class" definition, just about everybody is a member of a protected class because of age, race, color, creed, sex and disability. Individual employees could demand that the government supply them with all furlough-related documents, memos and guidebooks (including the 394-page Office of Management and Budget guide) as part of their case against the government. The government also could be compelled to supply data showing the age, race, sex, etc., of people furloughed to establish if the furloughs in their agencies had a "disparate impact" on one group, but not another, and were therefore illegal or discriminatory.

Military veterans could also claim veterans' preference seniority in furlough situations. Non-veterans, in theory, could also claim they were being discriminated against if vets weren't furloughed and they were.

Union members, and nonmembers part of a bargaining unit, would have the right to negotiate terms of furloughs.

Attorney John Mahoney, who chairs the labor and employment law practice group of Washington, D.C., law firm Tully Rinckey, said the legal actions that might arise from furlough backlash could cost the government as much as the across-the-board sequestration cuts would save.

Because of the 30-day notification process, Mahoney says none of the furloughs could begin until sometime in March and that various appeals and consultations could push them into April. Since furloughs are for the current fiscal year. they would have to be completed by Sept. 30, unless Congress and the White House change the rules again.

Bottom line: Nobody knows how or when this will play out. But if it happens. it could give a new meaning to the term "federal case."

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