Charles R. Fernandez v. Department of the Army

Citations: 234 F.3d 553; 165 L.R.R.M. (BNA) 2844; 2000 U.S. App. LEXIS 28848; 2000 WL 1693051Docket: 00-3190

Court: Court of Appeals for the Federal Circuit; November 13, 2000; Federal Appellate Court

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Charles R. Fernandez appealed the Merit Systems Protection Board's (MSPB) decision to dismiss his claim against the Department of the Army for failure to state a claim. Fernandez, a retired Army Sergeant First Class, sought a living quarters allowance for his civilian employment with the Army from 1979 to 1991, which was denied by multiple authorities, including the Comptroller General. His subsequent complaint in the Court of Federal Claims was dismissed due to a six-year statute of limitations.

In 1999, Fernandez appealed to the MSPB, which initially dismissed for lack of jurisdiction. Upon review, the MSPB acknowledged its jurisdiction under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USSERA) but stated that its authority was limited to enforcing rights as they existed at the time the claim accrued. The Board determined that the applicable law during the relevant period was the Vietnam Era Veterans' Readjustment Assistance Act of 1974 (VRRA), which did not provide the protections Fernandez claimed.

Ultimately, the MSPB concluded that Fernandez failed to allege any violation of rights under the relevant law as it existed between 1979 and 1991, leading to the dismissal of his appeal. The Federal Circuit Court upheld the MSPB's decision, agreeing that Fernandez's claim was not supported by the law in effect at the time the claims arose.

Fernandez appeals to the court, which has jurisdiction under 28 U.S.C. 1295(a)(9). The court must affirm the Board's decision unless it is found to be arbitrary, capricious, an abuse of discretion, not in accordance with the law, obtained without proper procedures, or unsupported by substantial evidence, with the petitioner bearing the burden of proving reversible error.

The Board's jurisdiction is limited to matters defined by law, rule, or regulation, specifically citing 5 C.F.R. 1201.3(a)(22), which grants jurisdiction over federal executive agency non-compliance with the provisions of chapter 43 of title 38 of the U.S. Code. This chapter includes the Uniformed Services Employment and Reemployment Rights Act (USERRA), which prohibits employment benefits denial based on uniformed service membership. The Board concluded that a living quarters allowance constitutes a "benefit of employment" under USERRA, affirming its jurisdiction over Fernandez's claim.

The court then examines whether Fernandez can claim relief for alleged USERRA violations regarding living quarters allowances denied from 1979 to 1991, prior to USERRA's enactment in 1994. The USERRA expanded protections to all uniformed service members and replaced previous provisions in the Veterans' Reemployment Rights Act (VRRA) with broader protections against employment discrimination based on service membership. 

Furthermore, the Veterans Program Enhancement Act of 1998 allows the Merit Systems Protection Board to adjudicate complaints irrespective of whether they accrued before, on, or after October 13, 1994, thus providing a basis for the Board to hear Fernandez's claim.

The MSPB, referencing the case of Williams, identified two interpretations of the Veterans' Preference Employment Act (VPEA): one allows the Board to adjudicate complaints that arose before October 13, 1994, under the predecessor statute (VRRA), while the other suggests a retroactive application of USERRA's substantive law. The Board concluded that the 1998 amendment grants authority to hear VRRA claims but does not extend to discrimination claims not previously prohibited. This conclusion was reached through an analysis of the statute's language, legislative history, and jurisprudential factors, indicating that USERRA's provisions took effect upon enactment on October 13, 1994, without retroactive implications. The Board cited a congressional comment emphasizing that the MSPB's jurisdiction applies to claims filed after this date, regardless of when the relevant actions occurred. Additionally, the Board expressed concerns about the retroactive application of legislation, referencing the presumption against retroactivity and the need for explicit congressional intent for such application under substantive law, as established in Landgraf v. USI Film Prods.

The Board determined that retroactive application of a statute could impair existing rights, increase liability for past actions, or impose new duties on completed transactions. Specifically, while section 2021(b)(3) of the Veterans’ Readjustment Assistance Act (VRRA) prohibited employment discrimination based on military reservist obligations, section 4311(a) of the Uniformed Services Employment and Reemployment Rights Act (USERRA) expanded this protection to all members of the uniformed services. The Board concluded that applying section 4311(a) retroactively would unfairly increase the agency's liability and impose new obligations regarding prior transactions. 

The Board agreed that the Veterans’ Preference Employment Act (VPEA) allowed the Merit Systems Protection Board (MSPB) to hear claims under both USERRA and VRRA, regardless of when the claims arose, but did not retroactively apply USERRA's substantive provisions. In assessing the merits of Fernandez's case, the Board noted that while USERRA protects against employment discrimination based on prior military service, the VRRA did not afford similar protections at the time of Fernandez's claim. Since Fernandez had not claimed reservist status during the relevant period (1979-1991), he was ineligible for VRRA protections. Consequently, the Board upheld the dismissal of Fernandez's appeal for failing to state a viable claim for relief.