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MSPB Takes Action Where OPM Fails to Issue Final Decision in Retirement Case

February 4, 2014

The Merit Systems Protection Board (MSPB) recently held that when the Office of Personnel Management (OPM) fails to issue a final appealable decision, engaging in substantial delays, the MSPB may be able to hear the appeal on the merits without waiting for a formal decision from OPM.  This decision is important and relevant to federal retirement cases that have languished for some time at OPM without a final decision being issued.

In Okello v. OPM, 2014 MSPB 2 (Jan. 2014), a retired federal employee filed an initial MSPB appeal against the OPM for failing to issue a final appealable decision on whether he owed the federal government for an alleged overpayment of annuity benefits.  An administrative judge issued an initial decision and dismissed the appeal on the basis of lack of jurisdiction.

After a 6-year period of filing multiple appeals with the MSPB and waiting for a final appealable decision from the OPM, the retired federal employee (Petitioner) later filed a Petition for Review with the MSPB Review Board (Board) regarding the administrative judge’s adverse initial decision.  The Board found that the OPM took over six years and essentially left the Petitioner uncertain as to the final outcome of his case; therefore, the Board reversed the initial decision and remanded the appeal to the administrative judge for further adjudication on the merits.

The MSPB in Okello took an exception to the normal rule regarding jurisdiction.  In Okello, however, the Board held that “under the totality of the circumstances, OPM’s failure to act on this matter constitutes an appealable administrative action affecting the appellant’s rights under FERS and that the Board has jurisdiction over this appeal.”  As a result, the Board found that under the unusual and compelling circumstances of the case that OPM had effectively abdicated its role of adjudicating the claim and that the merits of the Petitioner’s case would be heard.

The Okello decision is important in the context of delays caused by OPM in adjudicating final retirement matters. On many occasions, final decisions have been held up over a number of years due to OPM inaction.  Pursuant to Okello, federal employees and annuitants now have an additional potential argument to use when OPM does not issue a decision in a timely manner.

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