Agencies Can Indefinitely Suspend Indicted Feds, Court Rules

Grand jury indictment will now allow agencies to skirt certain due process rules.

Federal agencies may suspend indefinitely any employees potentially involved in a crime before they are found guilty, according to a new ruling, as long as they have been indicted by a grand jury.

In Henderson v. The Veterans Affairs Department, the U.S. Court of Appeals for the Federal Circuit ruled VA acted properly when it removed an employee a federal grand jury had indicted on 50 counts punishable by fines, imprisonment or both.

VA told Cathedral Henderson, a former program analyst based in Atlanta, it would reconsider his status upon the completion of the judicial proceedings. Henderson was indicted on charges related to falsifying health records and lying about it. The former VA employee, who was sentenced to 27 months in prison in 2016, was indicted for—and later convicted of—directing his employees to falsely mark 2,700 veterans’ cases seeking outside care as resolved. Henderson was found guilty on all 50 counts.

Federal agencies are permitted to indefinitely suspend any employee they “reasonably believe” has committed a crime that may result in imprisonment. Henderson argued his indictment was insufficient to establish reasonable cause, as VA itself was responsible for the allegations and the evidence that led to the indictment. Absent a third-party review, Henderson argued, the agency had denied him his constitutionally-protected due process and should not be able to suspend him indefinitely. He also claimed VA unfairly gave him less than 30 days of notice of an adverse action, which agencies are permitted to do under the same reasonable belief exception.

The appeals court, however, affirmed an earlier ruling from the Merit Systems Protection Board. In doing so, the court set a precedent allowing agencies to use the same suspension justification in the future.

The court said in a decision issued just after Christmas that it did not find Henderson’s argument persuasive.

“The record here is devoid of any evidence suggesting that the federal grand jury which returned the indictment against Henderson failed to independently and impartially weigh the evidence presented,” the court said. “That the VA allegedly provided the evidence supporting Henderson’s indictment does not negate the fact that an independent deliberative body determined that there was probable cause to believe that he had committed a serious crime.”

The appeals court added that if VA had continued to investigate the case against Henderson after it had gone to the grand jury, it could have “prejudiced [his] criminal defense.” It concluded Henderson failed to address the most fundamental standard agencies must meet when taking a an adverse personnel action.

“On appeal, Henderson does not challenge the determination that his suspension promoted the efficiency of the service,” the court said.

The central MSPB board originally ruled on Henderson’s case in August of 2016. The board is now prohibited from hearing any cases, as it has just one presidentially appointed, Senate-confirmed member and therefore lacks a quorum. President Trump has yet to nominate any new board members.

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