MSPB finalizes rule ending mandatory Douglas penalty factors

The Merit Systems Protection Board (MSPB) has finalized a rule that overhauls how federal agencies’ disciplinary penalties are reviewed, dropping the mandatory consideration of the 12 factors established in Douglas v. Veterans Administration in favor of a case-by-case “totality of the circumstances” standard. The final rule, published in the Federal Register of September 3, 2026 (Vol. 91, No. 170), amends the Board’s appellate procedures at 5 CFR Part 1201 and takes effect on October 5, 2026.

The rule, titled “Determining the Appropriate Penalty for Federal Employees Charged With Misconduct,” was issued under RIN 3124–AA35 (Docket ID OPM–2025–0012). It follows a joint notice of proposed rulemaking, “Promoting Employee Accountability,” published July 2, 2026 (91 FR 40444), in which the MSPB and the Office of Personnel Management (OPM) proposed separate amendments under distinct grants of authority.

What the final rule changes

Under the new framework, the Board will no longer require that every misconduct-based adverse action appeal weigh the 12 factors set out in Douglas v. Veterans Administration, 5 M.S.P.R. 280 (1981). Instead, the Board will evaluate whether the agency’s chosen penalty falls within the “tolerable limits of reasonableness” in light of the totality of the circumstances, determined on a case-by-case basis.

• The amendments apply to appeals filed with the Board on or after October 5, 2026.
• Appeals already pending on the effective date will be adjudicated under the framework in effect when they were filed.
• The Board’s own appellate procedures at 5 CFR 1201.56 are the subject of the change; OPM’s separate proposals to parts 412, 432, 715 and 752 are not finalized here.

The comment record

The comment period closed on August 3, 2026, and the Board received approximately 676 unique comments on the joint docket. Submissions came from labor organizations, associations of federal employees, managers, executives, retirees, practitioners’ organizations, policy and good-government groups, current and former civil servants, and individual members of the public.

• 43 comments were attributed to individual commenters who indicated their submission represented more than one person.
• Many commenters urged withdrawal of the proposal, while others expressed strong support, including two Federal executive departments.
• Critics argued the totality-of-the-circumstances standard would produce vague, inconsistent or politicized penalty decisions; the Board declined to withdraw the rule, responding to comments by subject rather than individually.

Rationale and impact

The Board grounded the change in its own institutional experience administering the Douglas framework for more than four decades, arguing that agencies have come to treat the factors as a compulsory checklist rather than a nonexhaustive guide. It cited data showing penalty mitigation rates fell from roughly 6.4 percent of adjudicated cases in FY 1986 to about 1.6–2.0 percent in sampled years from FY 2000 through FY 2025, and rejected objections that the record was inadequate to support the change.

For the roughly two million federal civil servants, the rule shifts the touchstone of disciplinary review from a structured factor-by-factor analysis to a holistic reasonableness inquiry, potentially easing agency removals while raising new questions about consistency and judicial review. The Board’s contact for the rulemaking is Gina K. Grippando, Clerk of the Board.

Source: Federal Register, Vol. 91, No. 170, September 3, 2026, Rules and Regulations (official reference: RIN 3124–AA35, Docket ID OPM–2025–0012; document 2026-18061).