OPM reassures managers of ‘extremely narrow’ liability in performance management actions

The Trump administration Is seeking to reassure federal managers and supervisors that their agencies will back them up legally if a subordinate pursues litigation over a poor-performance appraisal or firing.

In a memo to agency chief human capital officers, managers and supervisors last week, the Office of Personnel Management stressed that federal managers face “extremely limited” personal liability in instances where they seek to measure and improve employee performance.

“When a federal manager or supervisor engages in performance management—such as issuing a performance rating, putting an employee on a performance improvement plan, or proposing or deciding to reduce in grade or remove an employee for unacceptable performance—that action is taken by the agency employer, not the manager or supervisor in their individual capacity,” wrote Veronica Hinton, OPM’s associate director for workforce policy and innovation. “If an employee challenges a performance-based action, it is the United States or the agency who is held responsible for the action, not the supervisor. In the unusual event that a manager or supervisor is sued personally for actions within the scope of their employment, the Department of Justice typically provides representation.”

The memo reminded managers that federal law allows them to secure personal liability insurance to protect against the unlikely event that an employee personally sues them over an employment action, along with the option to expense up to half of the premium cost to their agency.

Dan Meyer, a partner at Tully Rinckey, a law firm that works primarily with federal employees, said he suspects the memo comes in response to “feedback” from federal managers who are fearful of repercussions related to the Trump administration’s efforts to overhaul federal personnel policy, including the impending return of Schedule F and the imposition of a forced distribution of performance ratings across agency workforces. He noted that although most appeals that go before the Merit Systems Protection Board fail, those that do succeed typically prompt an internal investigation of the manager involved.

“As you know, not too many people win at the MSPB, but the lore and the legend around the water cooler builds when it does happen, so even if it’s a few isolated instances over the last decade or so, everyone gets gun shy and no one wants to be aggressive,” Meyer said. “That’s why I think OPM is trying to give them some spine going forward.”

Meyer said the effort to empower managers to take potentially controversial actions against employees is key to the administration’s effort to reshape the federal workforce, both with more strident management of existing employees and more emphasis on the president’s political priorities in the hiring process.

“They’re trying to find a way to develop workforce management tools that allow them to move out people that they consider to be poor performers—and they may be or they may not be, or they may be doing things in a way the administration doesn’t like—and they want to move their own people in,” he said. “[It’s] important for the Republicans that if they lose the presidential election in 2028 that they will still have an executive branch workforce that is largely Republican in orientation. It’s like a way of returning to the spoils system, albeit through an MBA-like curriculum and the use of performance management tools.”

But Ron Sanders, a former federal HR official and veteran of multiple Republican presidential administrations, said improved support for federal managers to take adverse personnel actions against poor performers is long overdue.

“Stating what the status quo should be, if the memo encourages managers to test that status quo and maybe get more aggressive with dealing with poor performers, I’d applaud it,” he said. “I’d point out the fact that employees have consistently been saying in the Federal Employee Viewpoint Survey for the past couple of decades that they don’t believe managers are dealing with poor performers in the workplace.”

That said, he suggested that the memo was directed at the wrong group of federal workers.

“In my experience in government and talking to a lot of executives and senior managers after I’ve retired, it’s typically not them who are afraid to take a performance-based action, but rather once they do and an employee goes off and gets a union rep or a lawyer, it’s typically agency lawyers that run scared,” he said. “It’s not the manager who has the lax backbone, it’s typically agency lawyers. The fact that [OPM Director Scott] Kupor is sending a memo to the CHCO Council is a good thing, but it’s the wrong audience.”