Biden administration to spend $100M-plus to restore jobs or offer payments to employees improperly fired

Some former Veterans Affairs Department employees will soon get their jobs reinstated or receive cash payments after they were improperly fired under the Trump administration, as part of a newly negotiated settlement agreement between the agency and its largest union. 

The resolution has been years in the making after an arbitrator and the Federal Labor Relations Authority issued multiple rulings that VA under President Trump erred in its implementation of the 2017 VA Accountability and Whistleblower Protection Act, a law aimed at making it easier to fire employees at the department. Shortly after its passage, VA began dismissing employees without first offering them a performance improvement plan. 

The performance plans were required as part of the American Federation of Government Employees’ collective bargaining agreement with VA, where the union represents more than 291,000 workers. After AFGE challenged the policy, an arbitrator ruled in favor of the union. That decision was reaffirmed by back-to-back FLRA decisions, requiring VA to reinstate the impacted workers. 

“This agreement will allow VA and AFGE to move forward and focus on what matters most: delivering world-class care and benefits to veterans, their families, caregivers and survivors,” VA Secretary Denis McDonough said. “Union employees are the backbone of VA’s workforce, and we are proud to support them, today and every day in our shared mission to serve those who served.”

The settlement will give impacted former employees the option to either resume working for VA or take compensation instead. It is unclear exactly how many employees are affected by the agreement, though AFGE noted the department took 5,000 adverse actions against employees it represents using the 2017 law. VA called it a "fair agreement between both parties” that will cost at least hundreds of millions of dollars, with the exact amount determined by the number of former employees who take their jobs back. VA and AFGE mutually agreed that hundreds of former staff "terminated for grievous misconduct" will not be eligible to return to the department. 

AFGE originally brought the case for mediation after VA issued a series of memoranda that said VA was no longer required to give employees 90 days to improve and performance improvement plans would not be used. The union said that violated specific clauses in its collective bargaining agreement requiring those steps for employees identified for poor performance. 

Trump's VA had argued before FLRA that the contents of the 2017 accountability law superseded the provisions of its contract requiring the improvement plans. The authority ruled, however, that the law dealt only with the timeline for carrying out a firing or other punishment after VA provided the disciplinary notice. Because the plans are intended to improve performance well before the actual issuance of a punishment, FLRA said, the law had no bearing on them.

FLRA’s decision in 2020 and again in 2021 in part led to VA’s decision earlier this year to no longer enforce the firing provisions of the 2017 accountability law. While the Trump administration had challenged the rulings, the Biden administration upon taking office declined to appeal the case further to the federal circuit. VA and AFGE in 2021 reached an agreement to “reset” their relationship following the acrimony that marked the Trump era. After several starts and stops, the two sides reached a new collective bargaining agreement in April. 

House Republicans recently introduced the Restore VA Accountability Act (H.R. 4278), which cleared the House Veterans' Affairs Committee last week along a party-line vote, to reinstate and strengthen many of the provisions of the 2017 firing law. The measure would again remove the requirement for a performance improvement plan and lawmakers made clear in the new bill that its reforms would supersede any agreement VA had negotiated with a union.