Appeal from the United States District Court for the Eastern District of Virginia in Case No. 10-CV-0216, Judge Jerome B. Friedman.
The opinion of the court was delivered by: Bryson, Circuit Judge.
Before BRYSON, DYK, and O'MALLEY, Circuit Judges.
The appellant, Ralph E. Price, was a civilian employee of the Department of Defense. After retiring in 2007, he served as a re-employed annuitant for a fixed two-year term that expired on January 3, 2009. Like many other Department of Defense employees, Mr. Price was subject to the National Security Personnel System ("NSPS"), under which employees were eligible for performance-based incentives in the form of bonuses and salary increases. The NSPS was created by statute in 2003. See National Defense Authorization Act for Fiscal Year 2004, Pub. L. No. 108-136 § 1101, 117 Stat. 1392, 1621-22 (2003). It remained in effect until 2009, when it was repealed by the National Defense Authorization Act for Fiscal Year 2010, Pub. L. No. 111-84, § 1113(b), 123 Stat. 2190, 2498 (2009).
During the fiscal year that ended on September 30, 2008, Mr. Price received a performance rating for the "appraisal period" ending on that date that made him eligible for NSPS benefits. Those benefits, referred to as a "performance payout," could take the form of a salary increase, a bonus, or a combination of the two. Because Mr. Price's two-year term ended on January 3, 2009, he was not eligible for a salary increase, because by regulation the effective date of any performance payout in the form of a salary increase was the first day of the first pay period beginning on or after January 1 of each year, which in 2009 was January 4. See 5 C.F.R. § 9901.342(g)(6).
The dispute in this case turns on the effective date of NSPS bonus payments. The Department of Defense took the position that the effective date of a performance payout in the form of a bonus was the same as the effective date of a performance payout in the form of a salary increase, i.e., the first day of the first pay period beginning on or after January 1 of the year following the employee's appraisal period. Mr. Price argued that the effective date of a performance payout in the form of a bonus should be either the end of the appraisal period (in this case, September 30, 2008) or the first day of the following year (in this case, January 1, 2009). Because he was employed by the Department of Defense on both of those days, he contends that he was eligible for a bonus because he was employed on the effective date of the bonus payments.
When the Department of Defense denied Mr. Price's request to be paid a bonus for the appraisal period ending on September 30, 2008, he filed an action in the United States District Court for the Eastern District of Virginia on behalf of himself and a class of similarly situated former Department of Defense employees. Proceeding under the Little Tucker Act, 28 U.S.C. § 1346, he argued that the Department of Defense had unlawfully denied bonus benefits to him and to all others who had completed an appraisal period but had resigned, retired, or transferred out of the NSPS before the designated effective date for an increase in salary, i.e., the first day of the first pay period of the following year.
The district court held that it had jurisdiction over the action under the Little Tucker Act. On the merits, however, the court sustained the Defense Department's determination that the effective date for the payout of bonuses under the NSPS was the same as the effective date for increases in salary, i.e., the first day of the first pay period of the year following the appraisal period, January 4, 2009. Because Mr. Price was not employed on that date, the court held that he was not entitled to payment of a bonus for the appraisal period that ended on September 30, 2008.
We are met at the outset by the government's argument that the district court lacked jurisdiction over this action. Like the district court, we reject that argument, and for the same reasons.
The Little Tucker Act, 28 U.S.C. § 1346(a), allows a plaintiff to bring an action in district court if the action is based on a claim against the United States "not exceeding $10,000 in amount, founded either upon the Constitution, or any Act of Congress, or any regulation of an executive department." The Act both creates jurisdiction in the district court and waives sovereign immunity for an action falling within the jurisdictional grant. It does not, however, create a cause of action; for that, the plaintiff must look elsewhere. Fisher v. United States, 402 F.3d 1167, 1172 (Fed. Cir. 2005) (en banc in pertinent part). As the Supreme Court has explained, the plaintiff must "identify a substantive source of law that establishes specific fiduciary or other duties, and allege that the Government has failed faithfully to perform those duties," after which "the court must then determine whether the relevant source of substantive law can fairly be interpreted as mandating compensation for damages sustained" as a result of the breach. United States v. Navajo Nation, 537 U.S. 488, 506 (2003), quoting United States v. Mitchell, 463 U.S. 206, 217, 219 (1983); see also United States v. White Mountain Apache Tribe, 537 U.S. 465, 472 (2003). This court has characterized that requirement as imposing on the Tucker Act plaintiff the burden of showing that the source of substantive law is a "money-mandating" provision, i.e., it must mandate "compensation for specific instances of past injuries or labors." Nat'l Ctr. for Mfg. Scis. v. United States, 114 F.3d 196, 201 (Fed. Cir. 1997).
A statutory or regulatory provision that grants a government official or agency substantial discretion to decide whether to expend government funds in a particular way is not considered money-mandating and does not create a cause of action that can be prosecuted under the Little Tucker Act. See Barnick v. United States, 591 F.3d 1372, 1378 (Fed. Cir. 2010). However, a statute or regulation that provides for payment of money can qualify as money-mandating if the plaintiff's claim is that the statute or regulation creates a right to payment upon a showing that the plaintiff qualifies for that payment by satisfying designated statutory or regulatory requirements. Fisher, 402 F.3d at 1174-75; see Jan's Helicopter Serv., Inc. v. FAA, 525 F.3d 1299, 1307-08 (Fed. Cir. 2008); In re United States, 463 F.3d 1328, 1334-36 (Fed. Cir. 2006). Moreover, "[t]he substantive source of law may grant the claimant a right to recover damages either expressly or by implication." Navajo Nation, 537 U.S. at 506, quoting Mitchell, 463 U.S. at 217 n.16. Once the plaintiff has made such a showing, all the plaintiff is required to do in order to establish jurisdiction under the Tucker Act or the Little Tucker Act is to make a non-frivolous assertion that he is "within the class of plaintiffs entitled to recover under the money-mandating source"; the court then has jurisdiction to determine whether the plaintiff is entitled to relief on the merits. Jan's Helicopter Serv., 525 F.3d at 1307.
Complaints by civil service employees regarding personnel actions covered by the Civil Service Reform Act are subject to the jurisdiction of the Merit Systems Protection Board and do not give rise to actions under the Tucker Act or the Little Tucker Act. See United States v. Fausto, 484 U.S. 439, 449, 455 (1988); Worthington v. United States, 168 F.3d 24, 26-27 (Fed. Cir. 1999). However, a statute or regulation requiring an agency to pay employees certain amounts under certain circumstances is frequently money-mandating and sufficient to give rise to an action under the Tucker Act or Little Tucker Act for damages. See Hall v. United States, 617 F.3d 1313, 1317-18 (Fed. Cir. 2010) (suit for compensation for days employee was engaged in jury service); Brodowy v. United States, 482 F.3d 1370, 1375-76 (Fed. Cir. 2007) (statute providing for additional pay for FAA employees transferring between certain positions within the agency is a money-mandating statute); In re United States, 463 F.3d at 1334 (statute fixing salary of bankruptcy judges is a money-mandating statute); Bosco v. United States, 931 F.2d 879, 882 (Fed. Cir. 1991) ("prevailing rate" wage statute is money-mandating).
As the district court noted, the statutory scheme at issue in this case contemplated that bonuses would be paid in amounts dictated by the ratings given to NSPS employees for the pertinent appraisal period. 5 U.S.C. § 9902(b)(7)(I) (Supp. II 2008) (directing the Defense Department to promulgate regulations providing for a "payfor-performance evaluation system to better link individual pay to performance and provide an equitable method for appraising and compensating employees"). Those regulations created the NSPS pay system, which established pay structures and pay administration rules that replaced the standard civil service pay system for covered employees. 5 C.F.R. § 9901.301(a). With respect to the performance pay provisions of the NSPS, the regulations provided that NSPS employees would be rated after the close of each fiscal year, and each employee would be assigned a specific number of "shares" based on that rating. Those shares would then be used to determine the amount of the employee's performance payout. 5 C.F.R. § 9901.342. The amount of the performance payout would be calculated by starting with the number of shares each employee was assigned and multiplying the value of each share by the employee's base salary. Id. § 9901.342(g)(2).
In Mr. Price's case, the government does not dispute the amount that he would have been entitled to under the regulations if he had been employed on the effective date of the bonus payments. According to Mr. Price, that amount, calculated according to his rating during the 2008 appraisal period and reduced to a sum certain, was $4,777. The issue in this case is not the amount of the bonus, but whether he was entitled to any bonus at all, which turns not on the exercise of discretion by a government official, but ...