DHS has until midnight Friday to ask the full U.S. Court of Appeals for the District of Columbia to reconsider the decision of three of its judges, but expects not to do so, the official said. That decision broadened a lower court's ruling against the labor relations portion of the department's personnel reforms.
DHS still can ask the Supreme Court to review its case. The department has until Sept. 25 to decide, and the official said the department has reserved judgment on whether to do so.
If DHS opts not to appeal, or is rejected by the Supreme Court, then officials will have to rewrite regulations governing the collective bargaining, adverse actions and appeals parts of the department's sweeping new human resources system.
The appellate panel, which included two judges appointed by Republican presidents and one Democrat-appointed judge considered to be an expert in public sector labor relations law, unanimously objected to provisions in the system allowing DHS to negate collective bargaining agreements after the fact.
The panel also ruled that the department's attempt to drastically narrow the scope of what unions are allowed to bargain over was illegal.
A group of five unions sued DHS last year when it published final regulations to implement the new labor relations system as part of a larger human resources overhaul authorized when Congress created the department. Last summer, District Court Judge Rosemary Collyer enjoined the labor system before it even began, and the department appealed.
National Treasury Employees Union President Colleen Kelley said she had not heard from agency officials since the June appeals decision. She wrote DHS Secretary Michael Chertoff a letter the day after the decision asking for a meeting, but said she did not receive a reply.
On Friday Kelley praised DHS for signaling that it will not pursue a rehearing from the full appeals court, but said she was disappointed that the department continues to consider seeking a Supreme Court review. "Such an action ignores the reality that the proposed personnel system fails to comport with the law enacted by Congress," she said.
Kelley urged DHS to "abandon this pursuit and sit down with NTEU to develop a system that meets the needs of DHS employees, the agency and the country."
Without a new labor relations system, DHS would have to bargain with unions over the pay-for-performance, market-based pay, paybands and other personnel reforms included in the department's larger package.
The appeals judges found that DHS illegally changed the role of the Federal Labor Relations Authority -- an independent agency that oversees federal management-labor disputes -- without having the authority to do so. DHS set up its own internal Homeland Security Labor Relations Board, with members appointed by the secretary, to handle the disputes, and relegated the FLRA to an appellate role.
The Defense Department, which designed a system largely inspired by DHS, also lost a lower court case. Defense is still waiting for the court to schedule oral arguments on its appeal.