By Barbara Haga, June 17, 2019

This month we are looking at what I would describe as the “King of Condition of Employment Cases.” In Egan v. Navy, 484 U.S. 518 (1998), the Supreme Court answered the question of what type of review would apply when the condition of employment involved a security clearance. Anyone who deals with security clearance issues should read this foundational case, if they haven’t yet.

Egan was hired in 1981 as a Laborer at the Trident Refit Facility in Bremerton, Wash., where all positions were deemed sensitive. His appointment was documented as subject to satisfactory completion of security and medical reports. During the interim between his date of hire and the date of the decision on his security clearance, Egan performed limited duty and was not allowed on board any submarines. Upon completion of the requisite inquiry into his background, the Navy proposed his removal based on several factors. First, it was noted that criminal records from California and Washington state reflected that he had been convicted for assault and for being a felon in possession of a firearm. It was also shown that he had failed to disclose on his employment application that he had two earlier convictions for carrying a loaded firearm.  Finally, he had admitted that he had had prior drinking problems and at one point had completed the final 28 days of one of his sentences in an alcohol rehab program.

The Navy completed the next required step in the clearance denial process and provided him an intent to revoke notice. Egan replied that his debt to society for his past convictions had been paid. He also stated that he had not listed convictions older than seven years because he did not interpret the employment form as requiring that information, and that he had not had an alcohol problem for the three years preceding the clearance determination. He also provided favorable references from his supervisors regarding his background and character.

Despite the rebuttal information Egan submitted, the Navy denied his clearance. He exercised his clearance appeal within the Navy. The answer regarding the clearance was not modified. In 1983, the Navy removed Egan since he was not eligible for the job for which he had been hired.

In the initial decision, the AJ reversed the removal ruling that the Board had the authority to review the merits of an agency’s security clearance decision, including that the “… agency must specify the precise criteria used in its security-clearance decision and must show that those criteria are rationally related to national security.”  The AJ held that “… the ultimate burden was upon the agency to persuade the Board of the appropriateness of its decision to deny clearance.”    

The agency petitioned for review and the Board overturned the AJ’s decision. Egan then took the matter to the Federal Circuit where in a divided vote, that court reversed the Board’s decision. In the Federal Circuit decision, the Court explained that because the removal was taken under 5 USC 7512 rather than 5 USC 7532, the Board’s role of deciding the merits of the removal were not limited.  The government took the case to the Supreme Court.  The case was decided as summarized here:

The Majority of the Supreme Court, in a 5 to 3 decision, decided that a denial of a security clearance is not an adverse action and therefore not subject to Board review under 5 USC 7512 and 7513. The Board may only decide whether cause for denial existed, whether the security clearance was denied, and whether transfer to a nonsensitive position was feasible. It may not review the agency’s decision to deny a clearance on the merits. The Executive Branch is by law authorized to make judgments with regard to national security matters. This authority has been delegated to heads of agencies. “Certainly, it is not reasonably possible for an outside nonexpert body to review the substance of such a judgment and to decide whether the agency should have been able to make the necessary affirmative prediction [with regard to an individual’s possible future behavior] with confidence. Nor can such a body determine what constitutes an acceptable margin of error in assessing the potential risk.” The agency head is to have the final say as to whether an individual will be given access to classified information.

Thus, for security clearance denials and revocations, the required proof is that the agency observed the necessary due process in handling of the clearance and in carrying out any subsequent adverse action. Given that, one would think that these were not complex cases and almost impossible to mess up. However, as you’ll see, it is possible to lose one.

Everything that Could Go Wrong

Gamboa v. Air Force, 2014 MSPB 13, provides a checklist of what not to do. Gamboa was moved from the position of Electronics Technician to the position of GS-6, Supply Technician in 2005. It is an unusual change in positions, since one would expect that the Engineering Technician would have higher grade potential that the Supply Clerk, but nothing is provided in the decision to explain the move. The personnel action did not indicate that the new position required a clearance, although it was designated as non-critical sensitive. Unfortunately, neither the position description nor the vacancy announcement included than the position required access to classified information. The decision reflects that there was no affidavit from an agency official or a policy that established that the job required a clearance.

More troubling was the fact that Gamboa’s access to classified material was suspended in early 2007 yet the removal was not effected until December 2010.  The agency claimed that the duties requiring any handling of classified material were given to other employees who had clearance, but the Board was not convinced, writing , “… it is unclear how or why the agency maintained this alleged arrangement for nearly 4 years if eligibility for access and/or actual access to classified information was a requirement of the appellant’s position.”  The Board overturned the removal, holding that the Air Force had not established that there was a condition of employment which Gamboa failed to meet. In other words, the agency’s actions undermined the argument that a security clearance was required, and Gamboa came back to work. Haga@FELTG.com

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