## j2011-2

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### Principal claims and relief sought
- Applicant: Ms. Debra Pyne brought an Application against the International Monetary Fund before the Administrative Tribunal of the International Monetary Fund on November 14, 2011.
- Principal claims:
  - The Fund failed to meet its obligation under GAO No. 16, Rev. 6, Section 12.02, to assist her in securing an alternative position after abolition of her position as part of a reduction in force.
  - The Fund improperly failed to extend to her the same separation benefits option relating to access to a “Rule of Age 50” pension with a bridge to retiree medical benefits as was available to staff separating under the 2008 Fund-wide downsizing exercise.
  - Fund Management abused its discretion in declining to accept the Grievance Committee’s recommendation that she be awarded 50 percent of legal fees and costs incurred before that Committee, in accordance with GAO No. 31, Rev. 4, Section 7.04.
- Relief sought:
  - Monetary compensation based on a comparison between her current pension entitlement and the pension and other income she asserts she could have attained if reassigned under GAO No. 16, Section 12.02, or if offered the same retirement benefits options as staff separating under the 2008 Fund-wide downsizing.
  - 50 percent of legal fees and costs denied following the Grievance Committee’s recommendation.
  - Legal fees and costs that the Tribunal may award in accordance with Article XIV, Section 4, of the Statute if the Application is found well-founded in whole or in part.

### Procedural history and timeline
- Key dates and filings:
  - May 4, 2011: Applicant filed an Application with the Administrative Tribunal.
  - May 5, 2011: Application transmitted to Respondent; Registrar circulated notice within the Fund on May 9, 2011 pursuant to Rule IV, para. (f).
  - June 20, 2011: Respondent filed its Answer; supplemented on June 21, 2011 in accordance with Rule VIII, para. 4.
  - July 25, 2011: Applicant submitted her Reply; supplemented and transmitted on August 4, 2011; Respondent filed a Rejoinder on September 6, 2011.
  - October 12, 2011: Tribunal issued a Request for Information pursuant to Rule XVII, para. 3; Fund’s Response filed October 19, 2011; Applicant’s Comment submitted October 28, 2011.
  - November 14, 2011: Tribunal met to adjudge the Application (panel: Judge Catherine M. O’Regan, President; Judges Michel Gentot and Andrés Rigo Sureda).

### Applicant anonymity and document production
- Anonymity:
  - Applicant requested anonymity under Rule XXII; Tribunal denied the request, finding no good cause in a case involving separation and benefits entitlements.
- Document production (Rule XVII):
  - Applicant requested “All documents related to pension under the Rule of 50 and retention of medical benefits.”
  - Fund supplemented the record with the governing and explanatory documents relating to the “Rule of Age 50” and retiree benefits under the Medical Benefits Plan (MBP).
  - Tribunal denied Applicant’s renewed request for additional documents absent evidence Fund possessed more and issued a Request for Information focused on why the SRP “Rule of Age 50” was permanent while the MBP amendment was limited to staff “separating in the context of the current downsizing in FY2009-FY2011 only.”
  - After the Fund’s Response and Applicant’s Comment, Tribunal was satisfied all documents “related to pension under the Rule of 50 and retention of medical benefits” had been provided.

### Factual background and timeline of separation
- Employment facts:
  - Applicant first employed by the Fund beginning in 1989; at the time of events she held a Grade A12 position in a specialized career stream.
  - In summer 2007, the Department decided to reduce force by eliminating two staff positions in the Section via a call for volunteers; Applicant volunteered.
  - At the time of the call for volunteers, GAO No. 16, Rev. 5 (August 8, 1990), Section 13 governed reduction in force/separation; in early 2008 GAO No. 16, Rev. 6 (February 28, 2008), Section 12 superseded it.
- Postponement and SBF arrangements:
  - Applicant negotiated, through HRD, a six-month delay in abolition of her position and separation arrangements so she would reach age 50 before expiration of separation leave.
  - HRD letter of August 23, 2007: six-month redeployment period to run from May 1, 2008 to October 31, 2008; GAO notice period of 60 days approved; SBF payment equal to one and one-fourth months’ salary for each year of Fund service, up to a maximum of 22.5 months’ salary, to be determined at end of reassignment period.
  - Acting HRD Director letter of October 23, 2008: approved notice period “November 1, 2008 to December 31, 2008”; SBF entitlement specified as "22.5 months of your net salary as of your last day of active duty."; Applicant placed on separation leave effective "January 1, 2009" with separation leave expiring "on October 31, 2010."; election of SBF lump sum would end separation leave and preclude pension under SRP Section 4.2(d) (“Rule of Age 50”).
  - Applicant signed notification on October 31, 2008.
  - A staff member in Applicant’s former Section resigned effective "December 31, 2008"; the Department hired an external contractual candidate beginning in January 2009.
  - Applicant separated effective "October 31, 2010" and will begin receiving a pension under the “Rule of 75” in "November 2014."

### Applicant’s administrative review and Grievance Committee findings
- Administrative steps:
  - June 9, 2009: Applicant requested administrative review under GAO No. 31 alleging failure to advertise and allow application for a qualified position and adverse impact on retirement eligibility and lifetime earnings.
  - July 9, 2009: Applicant sought review by the Director of Human Resources; August 25, 2009: Acting HRD Director denied claims.
  - October 23, 2009: Applicant filed a Grievance with the Fund’s Grievance Committee.
- Grievance Committee Report and Recommendation dated August 5, 2010:
  - Found the Fund failed to assist Applicant in securing reassignment during her job search period, constituting a violation of GAO 16, Section 12.
  - Found Applicant had put the Fund on notice of her “interests and preferences” consistent with Section 12.02.
  - Determined a contractual appointment was not a “suitable position” for reassignment under GAO No. 16, Section 12.02.
  - Found no evidence Applicant sustained financial loss due to not being offered the contractual position.
  - Recommended grievance sustained in part and denied in part; no financial compensation to Applicant.
  - Recommended partial reimbursement of attorney’s fees and costs (half) in the amount of $22,141.50 pursuant to GAO No. 31, Rev. 4, Section 7.04.
- Management response dated February 2/3, 2011:
  - Noted disagreement with Committee’s recommendation to reimburse $22,141.50 because “no compensable harm was found, and no financial relief awarded.”

### Legal framework and key provisions relied upon
- GAO No. 16, Rev. 6 (February 28, 2008), Section 12:
  - 12.01: grounds for separation include reduction in strength and abolition of position.
  - 12.02: (i) Fund “will” assist affected staff for not less than six months in seeking another suitable position; staff have access to information on available positions; if equally qualified, preference given to staff subject to separation; (ii) appropriate training during the job search if it will facilitate selection; (iii) if reassignment efforts fail, appointment terminated.
  - 12.03: notice provisions: 60 calendar days’ notice; Director of Human Resources may extend up to 120 calendar days.
  - 12.05: payment from Separation Benefits Fund per Section 4.06.
- Separation Benefits Fund (Section 4.06): payment equal to 1¼ months’ salary for each year of service, subject to maximums including 22½ months’ salary.
- MBP provisions:
  - MBP Section 7.4: coverage continues for Participants and Dependents for duration of separation leave; transfers to permanent positions alter benefit commencement.
  - MBP Section 2.36 (A): defines “Retiree” and requirements for immediate pension or deferred pension and continuous plan coverage from separation through commencement of retirement benefits; includes footnote on 18-month extension option to meet minimum five years participation.
  - MBP Section 2.36 (E): special temporary provision for staff separating “in the context of the current downsizing in FY2009-FY2011 only,” allowing separation leave to be counted toward retiree medical eligibility under specified conditions and permitting an additional 18 months of MBP coverage (total 36 months) under the 18-month extension option (additional 18 months will not count toward retiree medical eligibility).
- Staff Retirement Plan (SRP) Section 4.2:
  - 4.2(c) (“Rule of 75”): reduced early retirement pension where age at least 50 and age in full months plus eligible service in months equals 900 or more; reduction formula specified.
  - 4.2(d) (“Rule of Age 50”), effective April 1, 2008: criteria include ceased participation on or after April 1, 2008 before normal retirement date, age 50 with three or more years of service or age 55 or older, not having received an SBF payment and having waived any right thereto, and electing early retirement pension under 4.2(d); reduced pension computed as larger of two specified calculations.

### Tribunal findings on reassignment duty (GAO No. 16, Section 12.02)
- Obligations and breach:
  - The Fund’s obligation under Section 12.02 “will” assist staff regardless of whether separation was voluntary or mandatory; the Fund has a primary responsibility to ascertain whether the staff member desires reassignment assistance.
  - Tribunal found Respondent failed to take the requisite initial step of inquiring about Applicant’s interest in potential reassignment.
- Applicant’s conduct and causation issues:
  - Applicant did not apply for any vacancy within the Fund and took limited initiative to assert a clear interest in reassignment to HRD; Tribunal found Applicant “took little initiative” and may have assumed reassignment possibilities were limited.
  - Evidence showed Applicant engaged in training and career counseling during the reassignment period.
- Effect on relief:
  - Because Applicant did not demonstrate she made her reassignment interest known at the relevant time and no suitable position existed, Tribunal concluded Applicant’s lack of diligence precluded relief despite the Fund’s failure to inquire.

### Tribunal findings on contractual hire and suitability for reassignment
- Factual finding:
  - A vacancy in Applicant’s former Section arose when a staff member resigned effective "December 31, 2008"; the Department hired an external contractual candidate who began work in January 2009.
- Legal conclusion:
  - A contractual appointment is not a “suitable position” for reassignment contemplated by GAO No. 16, Section 12.02; the Fund did not fail any obligation by not affording Applicant the opportunity to compete for the contractual appointment.
  - The decision to fill the need with a contractual employee was supported by bona fide business reasons (uncertainty of workload, budgetary constraints) and not improperly motivated to evade reassignment obligations.

### Tribunal findings on MBP amendment, SRP “Rule of Age 50,” and discrimination claim
- Legislative and temporal distinction:
  - SRP Section 4.2(d) (“Rule of Age 50”) was enacted in early 2008 with lasting effect and was available to all staff meeting its criteria.
  - MBP Section 2.36 (E) was a temporary amendment limited to staff “separating in the context of the current downsizing in FY2009-FY2011 only” (Executive Board decision, March 31, 2008).
- Interaction and consequence:
  - To use the SRP “Rule of Age 50” pension, a participant must waive SBF payments; without MBP Section 2.36 (E) applicability, waiving SBF would remove the SBF bridge to retiree medical coverage under MBP Section 2.36 (A).
- Discrimination and rational nexus test:
  - Tribunal applied a “rational nexus” test: classification must be supported by evidence and reasonably related to the objective.
  - Tribunal found a principled basis for distinguishing staff who separated under the 2008 Fund-wide downsizing from those who separated earlier or outside that exercise, tied to the objective of incentivizing separations during the downsizing and containing costs.
  - Documentary history showed MBP amendment aimed to facilitate the success of the Fund-wide downsizing (FY2009-FY2011) and that the Board intended the MBP changes to apply only in that context.
  - Tribunal concluded the MBP distinction was a reasonable exercise of policy-making discretion and did not impermissibly discriminate against Applicant.

### Tribunal findings on Management’s rejection of Grievance Committee recommendation for legal fees
- Governing rule:
  - GAO No. 31, Rev. 4, Section 7.04 allows the Grievance Committee to recommend reimbursement of some or all reasonable costs, including legal fees, if a grievance is found well-founded in whole or in part.
  - GAO No. 31 contemplates a final decision by the Managing Director and requires reasons if Management rejects or deviates from Committee recommendations.
- Application and outcome:
  - Grievance Committee recommended reimbursement of half of Applicant’s attorney’s fees and costs totaling $22,141.50.
  - Management declined to accept the recommendation, stating no compensable harm was found and no financial relief awarded.
  - Tribunal found Management acted within its authority and its reasons for rejection were not arbitrary or improperly motivated; therefore no abuse of discretion was established.
  - Tribunal declined to award Tribunal-level costs to Applicant because she “has not had significant success on the legal submissions she has made to this Tribunal.”

### Questions identified and remedial posture
- Issues for consideration identified by the Tribunal:
  - Whether volunteering for separation affects the Fund’s obligations under GAO No. 16, Section 12.02 (Tribunal concluded it does not).
  - What precise steps GAO No. 16, Section 12.02 requires the Fund to take to ascertain and assist a potentially redundant staff member.
  - Whether any relief should flow from the Fund’s failure to inquire, given Applicant’s own conduct and lack of demonstrated suitable positions.
- Tribunal’s remedial conclusion:
  - Applicant was denied the requested remedies.
  - The Tribunal concluded that Applicant did not demonstrate entitlement to monetary compensation or costs and that Management’s discretion was lawfully exercised in declining to reimburse $22,141.50.

### Decision and signatories
- The Administrative Tribunal of the International Monetary Fund unanimously decided:
  - The Application of Ms. Pyne is denied.
- Signatories:
  - Catherine M. O’Regan, President
  - Michel Gentot, Judge
  - Andrés Rigo Sureda, Judge
  - Celia Goldman, Registrar
- Location and date:
  - Washington, D.C.; November 14, 2011

*Administrative Tribunal of the International Monetary Fund — Judgment (Application of Ms. Debra Pyne v. International Monetary Fund), November 14, 2011.*

### Introduction

### Introduction

### Principal claims by Applicant
- Applicant, Ms. Debra Pyne, brought an Application against the International Monetary Fund before the Administrative Tribunal of the International Monetary Fund on November 14, 2011.
- The Application raises three principal claims:
  - The Fund failed to meet its obligation under GAO No. 16, Rev. 6, Section 12.02, to assist her in securing an alternative position with the Fund following the abolition of her position as part of a reduction in force within her Department.
  - The Fund improperly failed to extend to her the same separation benefits option relating to access to a “Rule of Age 50” pension with a bridge to retiree medical benefits as was made available to staff members separating under the 2008 Fund-wide downsizing exercise.
  - Fund Management abused its discretion in declining to accept the Grievance Committee’s recommendation that she be awarded 50 percent of legal fees and costs incurred in her representation before that Committee, in accordance with GAO No. 31, Rev. 4, Section 7.04.
- Relief sought by Applicant:
  - Monetary compensation based on a comparison between her current pension entitlement and the pension and other income she asserts she could have attained if reassigned under GAO No. 16, Section 12.02, or if offered the same retirement benefits options as staff separating under the 2008 Fund-wide downsizing.
  - 50 percent of legal fees and costs that she asserts were wrongfully denied following the Grievance Committee’s recommendation.
  - Legal fees and costs that the Tribunal may award in accordance with Article XIV, Section 4, of the Statute, if the Application is found well-founded in whole or in part.

### Respondent’s position
- The Fund maintains:
  - It fully met its obligations under GAO No. 16, Section 12.02, and did not wrongfully fail to assist Applicant in attaining reassignment.
  - Applicant did not express an interest in reassignment, no suitable vacancies were available, and filling the personnel need with a contractual hire was appropriate.
  - It did not impermissibly discriminate in not offering Applicant the same separation benefits as staff separating under the 2008 Fund-wide downsizing.
  - The rejection of the Grievance Committee’s recommendation to reimburse 50 percent of legal fees and costs was reasonable and within Management’s authority.

### Procedural history and timeline
- Key procedural dates and filings:
  - May 4, 2011: Applicant filed an Application with the Administrative Tribunal.
  - May 5, 2011: Application transmitted to Respondent; Registrar circulated notice within the Fund on May 9, 2011 pursuant to Rule IV, para. (f).
  - June 20, 2011: Respondent filed its Answer; supplemented on June 21, 2011 in accordance with Rule VIII, para. 4.
  - July 25, 2011: Applicant submitted her Reply.
  - Applicant’s Reply was supplemented and transmitted to Respondent on August 4, 2011 in accordance with Rule IX, para. 4; Respondent filed a Rejoinder on September 6, 2011.
  - October 12, 2011: Tribunal issued a Request for Information pursuant to Rule XVII, para. 3; Fund’s Response filed October 19, 2011; Applicant’s Comment submitted October 28, 2011.
  - November 14, 2011: Tribunal met to adjudge the Application (panel: Judge Catherine M. O’Regan, President; Judges Michel Gentot and Andrés Rigo Sureda).

### Applicant’s request for anonymity (Rule XXII)
- Applicant requested anonymity, asserting submissions include “extensive discussion about Applicant’s financial situation,” in particular salary and pension entitlements, which she argued Rule XXII was intended to protect.
- Respondent opposed anonymity, asserting the issues are not matters of personal privacy and that cases frequently involve compensation and benefits.
- Tribunal jurisprudence noted:
  - Anonymity is an exception and generally granted only in cases involving alleged misconduct or matters of personal privacy such as health or family relations.
  - Cited comparative examples include IMFAT Judgment No. 2010-4 (Ms. “EE”), IMFAT Judgment No. 2009-1 (Mr. S. Ding), and others where anonymity was granted or denied based on the nature of the allegations.
- Tribunal conclusion:
  - Applicant did not show good cause under Rule XXII for anonymity in this case involving separation and benefits entitlements; request for anonymity denied.

### Applicant’s request for production of documents (Rule XVII)
- Applicant requested “All documents related to pension under the Rule of 50 and retention of medical benefits.”
- Fund supplemented the record with what it interpreted as the “major governing and explanatory documents” relating to the “Rule of Age 50” of the Staff Retirement Plan (SRP) and retiree benefits under the Medical Benefits Plan (MBP).
- Applicant specified she sought documents “relating specifically to the Fund’s decision-making in her own case,” including documentary evidence of the Board’s intent or evidence that her separation was not connected to the Fund-wide downsizing exercise, and documents evidencing an inquiry about the Rule of 50 only after receipt of SBF payments.
- Fund’s further response:
  - Asserted no additional documentation existed relating to its determination that Applicant did not qualify for the expanded access to retiree medical benefits under Staff Bulletin No. 08/06.
  - Stated the only evidence of Applicant’s inquiry was testimony of a Division Chief of HRD during Grievance Committee proceedings (Tr. 188), indicating an inquiry and telephone response.
- Tribunal findings on document production:
  - Applicant proffered no evidence that the Fund possessed additional responsive documents; the renewed request in Applicant’s Reply was denied under Rule XVII, para. 1.
  - Tribunal issued a Request for Information to obtain additional documentation on why the “Rule of Age 50” was made permanent in the SRP while the MBP amendment was limited to staff “separating in the context of the current downsizing in FY2009-FY2011 only.”
  - After receiving the Fund’s Response and Applicant’s opportunity to comment, Tribunal was satisfied that all documents “related to pension under the Rule of 50 and retention of medical benefits” had been provided.

### Oral proceedings
- Article XII of the Statute and Rule XIII, para. 1 govern oral proceedings; such proceedings are to be held if the Tribunal deems them useful.
- Applicant did not request oral proceedings.
- Tribunal had the transcript of Grievance Committee oral proceedings, at which testimony was given by Applicant; the Director of Applicant’s Department; the Deputy Chief of Applicant’s Division; the Senior Personnel Manager (SPM) of Applicant’s Department; and a Division Chief of HRD.
- Tribunal authorized to weigh Grievance Committee record as part of the evidence (IMFAT Judgment No. 1996-1, para. 17).
- Tribunal concluded oral proceedings were not useful given the extensive written record and absence of a request; none were held.

### Factual background (key facts)
- Employment and grade:
  - Applicant was first employed by the Fund beginning in 1989 and remained in the same Department throughout her career, performing specialized functions; at the time of events she held a Grade A12 position in a specialized career stream.
- Transfer and dissatisfaction:
  - In 2005 Applicant transferred to a different Section within the same Division and testified she was not happy in the new assignment (Tr. 309).
- Reduction in force and volunteer separation:
  - Summer 2007: Management of Applicant’s Department, faced with decreased workload and budgetary constraints, decided to reduce force by eliminating two staff positions in the Section via a call for volunteers.
  - Applicant and another staff member volunteered to separate under GAO No. 16 relating to reduction in force and abolition of position.
  - At the time of the call for volunteers, reduction in force/separation was governed by GAO No. 16, Rev. 5 (August 8, 1990), Section 13; in early 2008 this provision was superseded by GAO No. 16, Rev. 6 (February 28, 2008), Section 12.
- Postponement and effects on benefits:
  - Applicant negotiated, through HRD, a six-month delay in abolition of her position and separation arrangements, allowing her to reach age 50 before the expiration of separation leave.
  - The postponement allowed access to coverage under the Medical Benefits Plan (Section 2.36 (A)) as a Fund retiree and to a retirement pension under the “Rule of 75.”
  - Senior Personnel Manager stated the timing accommodation was understood as a condition of Applicant volunteering for separation under GAO No. 16 (Tr. 394-396).
- HRD letter of August 23, 2007 explained:
  - A six-month redeployment period for reassignment would commence on May 1, 2008 and run to October 31, 2008; if reassignment efforts were unsuccessful, the appointment would be terminated.
  - The GAO provided for a notice period of 60 days, extendable to up to 120 days at the discretion of the Director of HRD; in Applicant’s case a notice period of 60 days was approved.
  - Applicant would be entitled to a payment from the Separation Benefits Fund (SBF) equal to one and one-fourth months’ salary for each year of Fund service, up to a maximum of 22.5 months’ salary, to be determined at the end of the reassignment period.

*Source: Administrative Tribunal of the International Monetary Fund — Introduction (Application of Ms. Debra Pyne v. International Monetary Fund).*

### 28.      In early 2008, before the beginning of Applicant’s May-October reassignment period, the

### j2011-2 - 28.      In early 2008, before the beginning of Applicant’s May-October reassignment period, the

### Fund downsizing, rule changes, and timing
- The Fund initiated a downsizing framework with a volunteer window from "March 1-April 21, 2008".
- Volunteer decisions under the downsizing initiative were irrevocable. (Staff Bulletin No. 08/03, pp. 1-2.)
- Revisions to internal law were implemented to provide incentives for voluntary separation and protections for mandatory separations; some amendments were specific to the downsizing and others had lasting effect.
- Key amendments:
  - Introduction of the “Rule of Age 50” pension option (lasting effect).
  - Temporary amendment to the Medical Benefits Plan (MBP) permitting staff separating under the downsizing who were not yet 50 years of age to choose the “Rule of Age 50” pension (which required relinquishment of Separation Benefits Fund (SBF) benefits) while qualifying for retiree medical benefits if a “hypothetical” SBF leave bridged them to age 50.
  - The MBP amendment was limited to staff members “separating in the context of the current downsizing in FY2009-FY2011 only.” (Executive Board decision, March 31, 2008.)

### Applicant’s interactions, separation arrangements, and timeline
- Applicant sought access to the “Rule of Age 50” pension and was told that “. . . the only way to do that is if you leave now and you waive your SBF.” (Tr. 219-220.)
- Applicant was told the MBP amendment “did not apply to me because it was a temporary rule only for those people involved in the downsizing.” (Tr. 345-346.)
- It is disputed whether Applicant expressed interest in reassignment to management or HRD; it is not disputed that the Fund did not identify any position to which Applicant might be reassigned during her job search period, and that Applicant did not apply for any vacancy within the Fund.
- Acting HRD Director letter of October 23, 2008 notified Applicant that her appointment was being terminated because her reassignment period did not secure alternative employment. The letter specified:
  - GAO No. 16, Revision 5, Section 13 notice period provisions: a notice period of 60 days, which may be extended up to 120 days at the discretion of the Director of HRD.
  - Approved notice period: 60 days; agreed notice period: "November 1, 2008 to December 31, 2008."
  - SBF entitlement: a payment equivalent to "22.5 months of your net salary as of your last day of active duty."
  - Applicant requested to receive SBF payment as separation leave; thus placed on separation leave effective "January 1, 2009" with separation leave expiring "on October 31, 2010."
  - At any time during separation leave Applicant could elect lump-sum SBF payment, ending separation leave.
  - Because Applicant opted for SBF payment, she "will not be able to withdraw a pension under the provisions of Section 4.2 (d) of the Staff Retirement Plan (Rule of Age 50)."
- Applicant signed and confirmed receipt of the notification on October 31, 2008.
- A staff member in Applicant’s former Section resigned effective "December 31, 2008"; the Department hired an external contractual candidate beginning in January 2009 to meet the need.
- Applicant separated effective "October 31, 2010", shortly after her 50th birthday, and will begin receiving a pension under the “Rule of 75” in "November 2014."

### Administrative review and grievance process — findings and remedies
- Applicant initiated administrative review under GAO No. 31 by letter dated "June 9, 2009", alleging failure to advertise and allow application for a position for which she was qualified prior to separation, asserting denial of opportunity to meet requirements for retirement under the Rule of 75, and claiming adverse impact on lifetime earnings potential.
- Department Director response dated "June 11, 2009" stated separation resulted from a call for volunteers in summer 2007 due to declining workload; asserted a Fund-wide recruitment freeze during downsizing and that the contractual hire was to meet a short-term need using an external candidate approached by the Section.
- Applicant sought review by the Director of Human Resources on "July 9, 2009", raising comparison with staff separating under 2008 downsizing and alleging the Division’s failure to identify means for her to apply for the position denied her the opportunity to meet Rule of 50 requirements.
- Acting HRD Director denied Applicant’s claims by letter dated "August 25, 2009", concluding the contractual position did not present an opportunity to extend Applicant’s staff appointment nor was the hiring process in error.
- Applicant filed a Grievance with the Fund’s Grievance Committee on "October 23, 2009."
- Grievance Committee Recommendation and Report dated "August 5, 2010" recommended the Grievance be sustained in part and denied in part. Committee findings included:
  - The Fund failed to assist Applicant in securing reassignment during her job search period, constituting a violation of GAO 16, Section 12.
  - Applicant had put the Fund on notice of her “interests and preferences” consistent with Section 12.02.
  - If the Fund considered the staff member responsible for initiating a job search, it should have informed her of that responsibility; GAO 16 fails to adequately distinguish between mandatory and voluntary separations.
  - The Fund’s decision to hire a contractual employee rather than make a staff appointment for a short-term need was a legitimate exercise of discretion; a contractual position was not a “suitable position” for reassignment under GAO No. 16, Section 12.02.
  - There was no evidence Applicant sustained financial loss due to not being offered the contractual position.
  - Recommendation: Grievance sustained in part and denied in part; no financial compensation to Applicant. (Id., pp. 37-38.)
- On "September 14, 2010" the Committee recommended partial reimbursement of attorney’s fees and costs: half of Applicant’s attorney’s fees and costs, pursuant to GAO No. 31, Rev. 4, Section 7.04, because the Committee concluded the grievance was sustained in part.
- Committee rationale for fees recommendation:
  - Although no financial loss to Applicant was found, the Fund’s inaction could have resulted in loss in another case.
  - GAO 16’s internal ambiguity contributed to the Fund’s failure to seek a suitable vacancy.
- Fund Management response notifying Applicant of the Committee’s Recommendations was dated "February 3, 2011" (cover email "February 3, 2011"; letter date "February 2, 2011"). Management stated:
  - Management noted the Committee’s findings and recommendation that the grievance be denied in part and sustained in part on the merits, but that claims for financial relief be denied.
  - Management disagreed with the Committee’s recommendation to reimburse "the amount of $22,141.50 in legal fees and costs", deciding there was no basis to accept the recommendation.

### Parties’ principal contentions summarized
- Applicant’s principal contentions (as presented in Application and Reply):
  1. Respondent wrongfully failed to assist Applicant in securing an alternative position, in contravention of GAO No. 16, Section 12.02, including failure to inform Applicant of a personnel need filled by a contractual hire.
  2. Applicant expressed interest to supervisors in remaining at the Fund in a position such as the one that became available.
  3. GAO No. 16, Section 12.02 does not distinguish between voluntary and involuntary separations; reassignment assistance obligations apply and international administrative jurisprudence supports an affirmative duty to assist.
  4. Fund unfairly discriminated by not extending to Applicant the benefits package relating to access to a “Rule of Age 50” pension with a bridge to post-employment medical coverage as made available under the 2008 downsizing.
  5. Fund misapplied the Executive Board’s decision by failing to consider abolition of Applicant’s position in the context of the Fund-wide downsizing.
  6. Fund abused discretion in declining to reimburse 50 percent of legal fees and costs despite the Committee’s recommendation.
  7. Relief sought:
     - monetary compensation based on a comparison between current pension entitlement and the pension and income Applicant could have attained had she been reassigned or offered downsizing retirement options;
     - 50 percent of legal fees and costs incurred before the Grievance Committee (consistent with the Committee’s recommendation);
     - legal fees and costs incurred before the Administrative Tribunal.
- Respondent’s principal contentions (as presented in Answer and Rejoinder):
  1. Respondent met obligations under GAO No. 16, Section 12; did not wrongfully fail to assist in seeking reassignment to a suitable position.
  2. Applicant did not express interest in participating in a job search after volunteering for separation; GAO No. 16, Section 12.02 does not impose a unilateral obligation on the Fund when a staff member does not express interest.
  3. GAO No. 16, Section 12.02 did not obligate the Fund to inform Applicant of a contractual opening in her former Section, because a contractual appointment would not have resulted in staff reassignment nor have been compatible with attaining the retiree medical benefits Applicant sought.

*Source: International Monetary Fund administrative record (j2011-2).*

### 4. The Fund did not fail to meet any obligation to Applicant in not extending her

### 4. The Fund did not fail to meet any obligation to Applicant in not extending her

### Key findings and determinations
- The Fund did not fail to meet any obligation to Applicant by not extending her staff appointment to meet the need that arose in her former Section.
- The IMF Executive Board’s decision expanding access to post-employment medical coverage for staff members separating under the 2008 Fund-wide downsizing program did not impermissibly discriminate against other Fund staff members, including Applicant; the distinction between categories of staff was directly related to the purpose of the benefit.
- The Fund did not misapply the Executive Board’s decision in Applicant’s case. The decision to abolish Applicant’s position pre-dated, and was not connected with, the Fund-wide downsizing.
- Management acted within its authority in declining to accept the Grievance Committee’s recommendation relating to reimbursement of legal fees in Applicant’s case. Recommendations of the Grievance Committee are not binding on Fund Management.

### Relevant provisions of the Fund’s internal law (excerpts and implications)
- GAO No. 16 (Separation of Staff Members), Rev. 6 (February 28, 2008), Section 12 addresses separation for reduction in strength, abolition of position, or change in job requirements and includes:
  - 12.01: Grounds for separation: (a) reduction in strength; (b) abolition of position; (c) change in job requirements; selection for separation “shall be made primarily on the basis of managerial judgment about their relative competence, taking into account their performance and the skills needed by the Fund.”
  - 12.02 Job Search and Retraining:
    - (i) Fund will assist affected staff for a period of not less than six months in seeking another suitable position; staff subject to separation have access to information on available positions; if equally qualified, preference is given to the staff member who is subject to separation.
    - (ii) Fund shall provide appropriate training during the job search and reassignment period if such training will facilitate selection.
    - (iii) If reassignment efforts fail, appointment shall be terminated.
  - 12.03 Notice: 60 calendar days’ notice; Director of Human Resources may extend up to 120 calendar days; may place staff on administrative leave with pay during notice.
  - 12.04 Resettlement Benefits: Eligible for resettlement benefits; minimum period of service requirement in General Administrative Order No. 8 does not apply.
  - 12.05 Payment from Separation Benefits Fund: Separation payment per Section 4.06.
- Section 4.06 (Payments under the Separation Benefits Fund) prescribes:
  - For regular staff with 4.8 years of service or more, amount equivalent to 1¼ months of salary for each year of service, subject to maximums including (i) the equivalent of 22½ months of salary.

### Medical Benefits Plan (MBP) provisions and application to Applicant
- MBP Section 7.4 (Reduction in Strength, Abolition of Position or Change in Job Requirements):
  - Coverage of Participants affected by reduction in strength, abolition of position, or change in job requirements “will continue for the Participants and their Dependents on the same basis as for Employees for the duration of the separation leave.”
  - If Participant accepts a temporary position prior to separation, benefits associated with separation leave do not begin until termination of temporary employment; if transfers to a permanent position, benefits based on separation leave are not initiated.
- Applicant negotiated a six-month delay in abolition of her position so she would reach age 50 before expiration of her SBF leave, thereby qualifying for continuation of medical benefits as a “retiree” under MBP Section 2.36 (A).
- MBP Section 2.36 (A) defines “Retiree” and includes:
  - A former Employee entitled to receive an immediate pension or elect a deferred pension and who separated at age 50 or older, with at least five years or more of Participation Service in the Plan, and who maintained Coverage in the Plan continuously from separation through commencement of retirement benefits.
  - Footnote: Any Retiree at least age 50 at separation but with less than five years of participation may use the 18-month post-employment Extension Option to meet the minimum five year participation requirement.
- MBP Section 2.36 (E) (special for Fund-wide downsizing separations, FY2009-FY2011) was not available to Applicant:
  - For Former Employees who separated in the context of the downsizing beginning May 2008 through FY2011 only, the period of separation leave may be counted toward retiree medical coverage eligibility even if SBF entitlements are taken as a lump sum or the staff member elects a deferred pension under the Rule of Age 50 and waives SBF entitlements.
  - For FY2009-FY2011 separations only, staff who take the 18-month extension option may elect an additional 18 months of MBP coverage, for a total extension option period of 36 months; the additional 18 months will be on same terms but will not count toward retiree medical eligibility.
- Section 2.36 (E) resulted from the Executive Board decision of March 31, 2008, amending the MBP to expand eligibility for post-employment medical coverage for staff separating under the downsizing; revision announced via Staff Bulletin No. 08/6 (April 18, 2008) and emphasized that changes “apply only in the context of the current downsizing in FY2009-FY2011.”

### Staff Retirement Plan interaction with MBP and Applicant’s pension election
- Staff Retirement Plan Section 4.2 addresses Early Retirement:
  - 4.2(c) (“Rule of 75”): Conditions for reduced early retirement pension where age at least 50 and “age in full months plus eligible service in months equals 900 or more” (i.e., Rule of 75), with formula: reduced by 5/12 of 1 percent for each month between effective date and earliest date pension could become effective under Section 4.2(a)(i).
  - 4.2(d) (“Rule of Age 50”), effective April 1, 2008, as amended:
    - Applicable where participant ceased to be a participant on or after April 1, 2008 before normal retirement date, has reached age 50, has three or more years of eligible service or is age 55 or older, has not received a payment from the Employer’s Separation Benefits Fund and has waived any right thereto, and elects to receive the early retirement pension under 4.2(d).
    - The reduced early retirement pension under 4.2(d) is the larger of:
      - (i) deferred pension decreased by 1/8 of 1 percent for each full month between pension effective date and normal retirement date; or
      - (ii) an amount determined under Section 4.2(b)(ii).
    - 4.2(d) was enacted with lasting effect and was available to all staff meeting its criteria; it was enacted in early 2008 in part to provide incentives to voluntary separation under the Fund-wide downsizing program but its availability was not restricted to staff separating under that exercise.
- Interaction and consequence for Applicant:
  - To avail herself of the “Rule of Age 50” pension, Applicant would have had to relinquish SBF payments that bridged her to post-employment medical coverage under MBP Section 2.36 (A).
  - Participants in the Fund-wide downsizing had a special MBP bridge under Section 2.36 (E) allowing counting of separation leave toward retiree medical eligibility even if SBF taken as lump sum; Applicant was not eligible for Section 2.36 (E). This differentiation in benefits underlies Applicant’s discrimination claim.
  - Had Applicant waived SBF to obtain the “Rule of Age 50” pension, she would have lost the bridge to continued medical coverage under Section 2.36 (A) because Section 2.36 (E) did not apply to her.

### Grievance Committee procedures and Management discretion (GAO No. 31)
- GAO No. 31 (Grievance Committee), Rev. 4 (October 1, 2008) provisions excerpted:
  - Purpose: establish Grievance Committee to hear cases and make recommendations to the Managing Director to facilitate fair resolution.
  - Section 7.04 Assistance of Counsel or Others: staff member may seek assistance; if Committee concludes grievance well-founded in whole or in part, it may recommend reimbursement for some or all reasonable costs, including legal fees; Committee should consider nature and complexity of case, nature and quality of work, and reasonableness of fees relative to prevailing rates.
  - Section 8.01: Committee has 30 days from record closure to submit written report and recommendations to Managing Director (period may be extended by mutual agreement).
  - Section 8.02 Remedies: Committee, if complaint well-founded, should assess relief needed to correct effects of decision; remedy may include monetary relief but not punitive relief.
  - Section 8.03 Final Decision: Managing Director or designee takes final decision and transmits in writing to grievant within 90 days of Committee’s Report; if Managing Director rejects or deviates from Committee’s recommendations, decision shall include reasons for such rejection or deviation.
- Application to Applicant’s claim about legal fees:
  - Applicant claimed Management abused discretion by declining to follow Grievance Committee’s recommendation that she be awarded 50 percent of legal fees and costs incurred before that Committee.
  - Management’s action—declining to accept the Committee’s recommendation—was within its authority because Committee recommendations are not binding on Fund Management; GAO No. 31 contemplates final decision by the Managing Director, including reasons if recommendation rejected or deviated from.

*Source: The Fund (IMF) adjudicative document.*

### 59.      The Application of Ms. Pyne raises three distinct issues for the consideration of the

### The Application of Ms. Pyne

### Issues for determination
- Whether Respondent failed to assist Applicant in seeking reassignment to a suitable position within the Fund following the abolition of her position as part of a reduction in force in her Section, in contravention of GAO No. 16, Section 12.02.
- Whether the Fund improperly failed to afford Applicant the same enhanced separation benefits relating to access to a “Rule of Age 50” pension with a bridge to retiree medical benefits as was available to staff members separating under the 2008 Fund-wide downsizing.
- Whether the Fund’s Management abused its discretion in declining to accept the recommendation of the Grievance Committee to award Applicant partial attorney’s fees for her representation before that Committee, pursuant to GAO No. 31, Rev. 4, Section 7.04.

### GAO No. 16, Section 12.02 — text and obligations
- Section 12.02 provides:
  - “(i) In the event of a reduction in strength, an abolition of position or the redesign of a position resulting in a redundancy, following the effective date of the notice of separation, the Fund will assist the affected staff member over a period of not less than six months in seeking another suitable position to which he may be reassigned. Staff subject to separation will have access to information on available positions in the Fund. Based on their interests and preferences, the Fund would assist them in identifying suitable vacancies for which they may wish to compete. Staff subject to separation will be considered for such vacancies along with other applicants, taking into account their qualifications for the vacant position. If the staff member subject to separation is considered to be equally qualified for the position as another applicant who is not being separated, preference will be given to the staff member who is subject to separation.
  - (ii) During the job search and reassignment period, the Fund shall provide the staff member with appropriate training if such training will facilitate his selection for an existing or known prospective vacant position.
  - (iii) If all efforts to reassign the staff member fail, his appointment shall be terminated.”

- The obligation in Section 12.02 was explicitly communicated to Applicant in Human Resources Department correspondence in October 2007 and again in October 2008, including a letter of October 23, 2008 stating: “. . . since your reassignment period did not result in securing alternative employment in the Fund, your appointment with the Fund is being terminated.”

### Legal and normative context
- The Fund’s internal law (GAO No. 16, Section 12.02) aligns with general principles of international administrative law requiring international organizations to make “genuine, serious, and pro-active efforts in reassignment of their employees whose positions have been abolished.” (citing IMFAT Judgment No. 2005-1, para. 117, and ILOAT Decision No. 269 (1976), Consideration 2).
- The reassignment/search period is not a mere formality; separation may occur only “if the reassignment process is unsuccessful” (Section 12.02 (iii)).

### Tribunal findings on the Fund’s duty regarding volunteers
- The Fund’s obligation under GAO No. 16, Section 12.02 “will” assist staff regardless of whether the staff member is subject to mandatory abolition or volunteered in a reduction in force.
- The Fund has a primary responsibility to ascertain whether the staff member desires reassignment assistance; that responsibility “does not vary because the staff member has volunteered.”
- The Tribunal concluded that Respondent failed to take the requisite initial step of inquiring about Applicant’s interest in potential reassignment within the Fund. (The Fund has not offered evidence that HRD asked Applicant about her interest; Applicant testified no one in HRD asked her about reassignment interests. (Tr. 316-317).)

### Evidence about parties’ conduct and competing factual inferences
- Fund’s position:
  - GAO No. 16, Section 12.02 does not impose a unilateral obligation to assist unless the staff member expresses an interest in such assistance.
  - Key officials (Department Director, Senior Personnel Manager, HRD official) were “kept completely unaware that their assistance with an internal job search was either expected or desired.”
  - HRD Division Chief testified that reassignment steps “are taken when the staff member requests the assistance.” (Tr. 177-178.)

- Applicant’s position and evidence:
  - Applicant contends the Fund did not undertake “any meaningful and genuine steps in assisting Applicant, such as meeting with her, discussing her options and pointing out suitable posts. Applicant was provided with no information about reassignment possibilities at all, let alone given the opportunity to compete for an opening.”
  - Applicant asserted she spoke a “handful of times” with her Division Chief about her interest in staying on in the Division. (Tr. 369.) She testified she “did not know I had to” inform HR directly and that she had “let [the Division Chief] know” about interest in staying once the “Rule of 50” came about. (Tr. 317-318.)
  - Applicant enrolled in business-related courses and met with the Fund’s career counselor during the reassignment period, consistent with entitlement to training under Section 12.02 (ii). (Tr. 326, Tr. 328.)
  - Applicant planned to join her husband in a business after separation; she also testified that remaining at the Fund for an additional year or two to become eligible for a “Rule of Age 50” pension appealed to her. (Tr. 323-324.)

- Evidence suggesting Applicant did not clearly assert interest in reassignment:
  - Applicant did not apply for any vacancy within the Fund.
  - Department officials, including the Division Chief (now deceased) and the Senior Personnel Manager, did not recall being told Applicant sought reassignment. (Tr. 192, 194; Tr. 400-401.)
  - Testimony by HRD Division Chief and Senior Personnel Manager indicated their understanding that Applicant intended to start a business with her husband and had “reached a sort of plateau and . . . was ready to move on.” (Tr. 192, 194; Tr. 395-396; Tr. 131.)

### Tribunal assessment and intermediate conclusions
- The Tribunal weighed the evidence and concluded:
  - The Fund failed to inquire initially about Applicant’s intentions, contrary to the express GAO “will” obligation and consistent communications to Applicant.
  - Applicant, however, “took little initiative to make known to Fund officials any interest she may have had in reassignment.” The Tribunal found that Applicant appeared to assume reassignment possibilities were limited based on specialized skills and conversations with her Division Chief.
  - Applicant’s expectation that “if there was something they would have told me about it” (Tr. 358) may have been consequential of the Fund’s failure to inquire.
  - Applicant’s interest in remaining at the Fund may have crystallized only after learning in December 2008 of a contractual hire in her former Section.

### Questions for further consideration identified by the Tribunal
- Whether Applicant’s act of “volunteering” for separation affected the Fund’s obligations under GAO No. 16, Section 12.02 (Tribunal concluded it does not).
- What precise steps the Fund is required to take under Section 12.02 to ascertain and assist a potentially redundant staff member.
- Whether any relief should flow from the Fund’s failure to inquire, taking into account Applicant’s own conduct and the extent to which she expressed interest in reassignment.

*Source: The Application of Ms. Pyne, Administrative Tribunal adjudication as reflected in the provided text.*

### Section in which she had worked prior to her 2005 transfer?

### j2011-2 - Section in which she had worked prior to her 2005 transfer?

### Facts and chronology concerning the vacancy in Applicant’s former Section
- A staff member in the Section in which Applicant had worked prior to her 2005 transfer resigned on October 9, 2008, with effect from December 31, 2008.
- To fill the need, the Fund hired an external candidate on a contractual basis; the contractual employee’s impending arrival was announced to the Division in mid-December 2008 and he began work in January 2009. (Tr. 330.)
- The Fund did not notify Applicant that it was seeking to fill a personnel need in her former Section and did not consider reassigning her for that purpose; the Fund maintains it had no obligation to inform Applicant of a contractual opening in her former Section.

### Applicant’s contentions
- Applicant contends she should have been:
  - informed about, and given an opportunity to compete for, the contractual position (which she claims she would have been “perfectly suited” for), and
  - either hired to fill the contractual position or reassigned as a staff member on a temporary assignment to meet the need.
- Applicant argues alternatively that the Fund “misapplied” MBP amendments or discriminated against staff separating outside the Fund-wide downsizing.

### Legal and policy framework relevant to reassignment
- GAO No. 16, Section 12.02 governs reassignment assistance; the responsibility is to avert separation as a staff member.
- Contractual appointments are not staff appointments and would require separation from the staff to accept; contractual employees may opt to participate in the MBP during employment but are not eligible for Retiree coverage, which is linked to participation in the Fund’s Staff Retirement Plan. See MBP Section 2.36. (Footnote 15.)

### Tribunal’s analysis and conclusions on reassignment and contractual hire
- A contractual appointment is not a “suitable position” for reassignment within the contemplation of GAO No. 16, Section 12.02; therefore the Fund did not fail to meet any obligation by not affording Applicant the opportunity to compete for the contractual appointment.
- The choice to fill the need with a contractual employee was supported by business reasons:
  - Deputy Division Chief testimony: initial uncertainty about workload and intent “to hire him as a temporary contractual employee to see us through.” (Tr. 134-135.)
  - Department Director and Senior Personnel Manager testimony: budgetary constraints militated against temporarily assigning a staff member to perform the work. (Tr. 109-110, 406.)
- The decision to create a contractual position was in pursuance of genuine business concerns and not improperly motivated to evade reassignment obligations; the Tribunal rejects Applicant’s contention that the Fund should have temporarily reassigned her to the position.
- The Fund’s managerial discretion to organize its workforce is broad but not unfettered; the precise contours have not been fully determined (citing IMFAT Judgment No. 1999-1).

### Tribunal’s findings on the Fund’s duty to offer reassignment assistance generally
- Precedent: The Tribunal has recognized an affirmative duty to make genuine, serious, and pro-active efforts to reassign employees whose positions have been abolished, with cases indicating:
  - Some fault may be borne by both the organization and the staff member where neither party pursued reassignment with sufficient initiative (citing Mr. “F” and Marshall).
  - An organization should at least consider and give the affected staff member an opportunity to compete for newly created vacant positions in the department (citing Jakub).
  - Budgetary constraints and broader reductions in force can legitimately hinder reassignment efforts (citing F (No. 2) v. IBRD).
- The Tribunal concludes the Fund should have inquired of Applicant whether she sought assistance in identifying reassignment possibilities when informing her of the administrative arrangements relating to abolition of her position; the Fund plainly did not have such a conversation.
- Nevertheless, on the record before it:
  - Applicant gave unmistakable indications that she was preparing to continue her career elsewhere.
  - There is no evidence that any suitable position existed to which Applicant might have been reassigned.
  - The Tribunal is unable to conclude that Applicant made an interest in reassignment known at the relevant time to Fund officials.
  - Applicant’s failure to be “diligent in [her] own interests” (Jakub, para. 76) precludes relief in this case.

### Tribunal’s findings concerning access to the “Rule of Age 50” MBP benefit
- MBP Section 2.36 (E) was a temporary amendment applicable to “staff separating in the context of the current downsizing in FY2009-FY2011 only.” (Executive Board decision, March 31, 2008.)
- Applicant contends she was “separating due to the abolition of her position in the context of downsizing in FY2009-FY2011” and that HRD misapplied the Board’s March 31, 2008 decision by denying her access to the new rule.
- The Fund contends Applicant’s separation was not connected to the Fund-wide exercise but arose from “long-standing departmental downsizing plans” within Applicant’s Department.
- The Tribunal finds Applicant’s contention that her separation was in the context of the FY2009-FY2011 downsizing runs counter to the evidence:
  - Applicant’s separation resulted from a reduction in force taken in her Section in summer 2007.
  - The initiation of Applicant’s separation arrangements was delayed by six months, at her request, so that her SBF leave would extend until she reached age 50.
- The Tribunal therefore rejects the contention that Applicant’s separation fell within the MBP amendment’s limited applicability to FY2009-FY2011 downsizing.

*Source: IMF Administrative Tribunal judgment.*

### 106.     The record of the case supports the view that Applicant’s Section underwent its own

### j2011-2 — 106–126

### Departmental reduction in force versus Fund-wide downsizing: factual findings
- Applicant’s Section underwent its own reduction in force prior to the Fund-wide downsizing; testimony: Department “has been nothing but in a downsizing mode. . . . We actually started  . . .  in 2006-2007 to reduce the number of staff, and in 2008, we sort of had a second wave . . . in the wake of the Fund-wide downsizing.” (Tr. 28).
- Deputy Division Chief: Department “was ‘subject to two different downsizings.’” (Tr. 145). “‘[W]e were downsized before the downsizing.’” (Tr. 168).
- Applicant and Ms. Pyne understood the terms of her separation to be governed solely by GAO No. 16 and not by special enactments relating to the Fund-wide downsizing. (Tr. 362, 365).
- Applicant’s testimony on the temporary MBP amendment: “I was told that it did not apply to me because it was a temporary rule only for those people involved in the downsizing.” (Tr. 345-346).

### Design and timing of the Fund-wide downsizing exercise
- Downsizing announced as a special one-time exercise with a volunteer window from March 1-April 21, 2008.
- Volunteers to be informed of acceptance or refusal on or before April 30, 2008.
- Volunteers required to select a preferred last day of active duty between May 14, 2008 and May 13, 2009.
- Under the Fund-wide downsizing, staff were informed: “Your application to separate on the date of your choosing is irrevocable.” (“Exploring Your Options” (February 11, 2008), p. 2; Staff Bulletin No. 08/03 (February 29, 2008)).

### Legislative intent and scope of the MBP amendment
- Legislative history shows no indication the Board intended to include staff other than those separating as part of the Fund-wide downsizing exercise.
- The MBP amendment emerged solely from concerns relating to the efficacy of the downsizing incentives and was intended “to facilitate the current downsizing in FY2009-FY2011.” (“Proposed Changes in Personnel and Other Policies in the Context of the Fund’s Strategic Directions,” EBAP08/21 (March 21, 2008), p. 2).
- Communications to staff emphasized limited scope:
  - Staff Bulletin No. 08/6 (April 18, 2008), p. 1: changes to MBP “apply only in the context of the current downsizing in FY2009-FY2011”.
  - FAQs, 4/18/2008: modified MBP “As a part of the downsizing exercise only, the MBP has now been modified so that any staff member who could have used the SBF as separation leave to bridge to the age of 50 and/or to the required MBP participation period will be considered to actually have done so for purposes of assessing eligibility for retiree coverage, even if he/she opts for a deferred pension under the Rule of Age 50 or a lump sum SBF payment”.

### Legal and jurisprudential framework for review of the MBP amendment
- Tribunal recognizes competence to review regulatory decisions but with a narrow scope and deference to decision-making organs; review is “at its height when the Tribunal reviews regulatory decisions (as contrasted with individual decisions), especially policy decisions taken by the Fund’s Executive Board.” (Ms. “J”, para. 105).
- Fund’s discretionary authority to amend employment terms is circumscribed by internal law (Articles of Agreement, By-Laws and Rules and Regulations, General Administrative Orders) and by the rule of nondiscrimination as a substantive limit.
- The de Merode standard (WBAT Decision No. 1 (1981)) applied: legislative changes must be based on proper consideration of relevant facts, reasonably related to objectives, made in good faith, not prompted by improper motives, not discriminate in an unjustifiable manner, and seek to avoid excessive and unnecessary harm.

### The “rational nexus” test and its application
- Tribunal’s articulated “rational nexus” test:
  - Respondent’s reasons must be supported by evidence (“. . . could . . . have been taken on the basis of facts accurately gathered and properly weighed.”).
  - There must be a rational nexus between the classification of persons and the objective of the classification.
- Tribunal precedent sustains differential allocation of benefits where a rational nexus exists (examples: Billmeier; Faulkner-MacDonagh; Mr. “R”; Ms. “G”).
- Tribunal recognizes policy-making discretion includes choosing among reasonable alternatives and that categories may rest upon generalizations; a perfect fit is not required.

### Core adjudicative question addressed
- Whether MBP Section 2.36 (E) providing for a hypothetical bridge to MBP coverage for staff separating with a “Rule of Age 50” pension pursuant to the downsizing discriminated impermissibly between staff separating under the 2008 Fund-wide downsizing and other staff including Applicant.

### Parties’ positions and Tribunal’s considerations
- Applicant: the bar to benefitting from the relaxed MBP Rule on Age 50 was “a simple mistake.”
- Respondent: the decision was “rational, it was taken after carefully weighing relevant facts and policy considerations, and the distinction among categories of staff was directly tied to the purpose of the benefit in question.”
- Respondent emphasized the Board’s unwillingness to approve “a substantial and costly expansion of eligibility for this lifetime benefit on a broad or permanent basis” so soon after 2002 liberalization; a limited, restricted liberalization tied to encouraging separations under the Fund-wide downsizing was acceptable from a cost perspective and likely to contribute to the success of the exercise.
- Tribunal will assess whether the allocation of the MBP amendment to staff separating within the Fund-wide downsizing—but not to staff separating due to prior departmental reductions in force—was rationally related to the amendment’s stated purposes and supported by evidence.

### Relevant factual distinctions affecting fairness
- Applicant separated as the result of a departmental reduction in force that preceded the volunteer window by at least six months.
- Applicant’s separation was postponed by six months at her request so she would reach age 50 before her SBF leave expired and thereby attain eligibility for retiree medical benefits under MBP Section 2.36 (A).
- The Fund’s treatment of volunteers versus refused applicants: if a volunteer’s application for “voluntary” separation under the downsizing was refused and the staff member then resigned, that staff member did not receive GAO No. 16, Section 12 separation benefits nor the “enhanced” MBP amendment benefits (“Exploring Your Options,” (February 11, 2008), p. 3).

### Consideration of cost as a legitimate factor
- Tribunal precedent recognizes cost as a legitimate factor in amending non-fundamental employment terms (Daseking-Frank et al.; citation to Kepper v. International Finance Corporation, WBAT Decision No. 149 (1996)).
- Cost considerations may properly influence timing and scope of benefit changes and do not, by themselves, establish improper motive.

*Source: International Monetary Fund, IMFAT judgment excerpt (paragraphs 106–126).*

### 127.     Applicant asserts that “[t]he rational nexus in this case is the shared status of staff who

### Applicant’s challenge to MBP amendment eligibility and reimbursement of legal fees

### Tribunal findings on similarity of status and reasonableness of MBP distinction
- Applicant asserted that the “rational nexus in this case is the shared status of staff who were separating voluntarily from the Fund after adoption of the liberalized MBP.” Applicant argued that staff “short of age 50” who benefited should be treated equally.
- Tribunal conclusion: The distinction drawn by the Executive Board between staff separating under the 2008 Fund-wide downsizing and those who separated close in time but not as part of that exercise was a reasonable exercise of policy-making discretion. The Tribunal stated that “[t]he Fund’s policy-making discretion extends to making choices among reasonable alternatives.” Billmeier, para. 83; Faulkner-MacDonagh, para. 78.
- Rationale found by the Tribunal:
  - There was a principled basis, grounded in facts and deliberation, for distinguishing participants in the downsizing from others: the “concern for providing incentives to separation during the downsizing exercise as balanced against the costs of extending such incentives beyond the scope of that program.”
  - The 2008 Fund-wide downsizing aimed to “encourage the voluntary separation of staff members in order to trim and re-shape the Fund’s workforce for the purpose of reducing expenditures and refocusing the mission of the organization.” Billmeier, para. 76; Faulkner-MacDonagh, para. 71.
  - Some 492 staff members separated under the terms of the downsizing exercise.
  - Applicant had decided to separate without inducements beyond separation entitlements in GAO No. 16, Section 12, other than a six-month delay to reach age 50, and “effectively seeks the retroactive benefit of the MBP amendment.”

### Legislative and administrative history of SRP and MBP amendments
- Staff Retirement Plan (SRP) amendment:
  - SRP amendment introducing the “Rule of Age 50” emerged from the Employment, Compensation and Benefits Review (ECBR) and aimed at a longer-term human resources strategy to facilitate mid-career mobility.
  - The SRP staff paper rejected a temporary “window” limiting the “Rule of Age 50” to those leaving during the restructuring, noting that such a window “could undermine staff morale” and that applying the Rule of Age 50 broadly would address longer-term institutional needs. Quotation: “This avoids introducing a window approach, under which better benefits would be provided to those who leave during the restructuring, as this could undermine staff morale...”
- Medical Benefits Plan (MBP) amendment:
  - The MBP amendment was adopted on a temporary basis to facilitate use of the new pension option by staff just short of age 50 by providing access to subsidized retiree medical coverage “for staff separating in the context of the current downsizing in FY2009-FY2011 only.”
  - Documentary record indicates the MBP amendment was driven solely by concerns about the success of the Fund-wide downsizing, rather than as part of a longer-term HR strategy.
  - The HRD Memorandum of February 20, 2008 proposed three alternatives and recommended the third alternative be considered “for separations as a result of the restructuring,” balancing extension of retiree medical coverage with avoiding added financial liabilities to the MBP.

### Specific MBP enhancements tied to the downsizing exercise
- Respondent noted that separation benefits for volunteers under the Fund-wide downsizing largely replicated Section 12 of GAO No. 16 but included a number of enhanced benefits and incentives available only to those separating under the Fund-wide exercise, including:
  - payment of education allowances to eligible staff for the full academic year in which they separate or begin separation leave,
  - a range of additional in-house and external placement services,
  - waiver by the Fund of some staff obligations to repay the Fund for unmet minimum service requirements.
  - These enhancements were explicitly described in communications to staff (quotation: “Enhancements include[d] payment of education allowances...”).

### Tribunal assessment of Management’s refusal to reimburse attorney’s fees
- Grievance Committee recommendation:
  - The Grievance Committee recommended the grievance be sustained in part and that 50 percent of the applicant’s attorney’s fees and costs be reimbursed by the Fund pursuant to GAO No. 31, Rev. 4, Section 7.04.
  - GAO No. 31, Rev. 4, Section 7.04 provides (quotation):
    - “7.04 Assistance of Counsel or Others. A staff member may seek the assistance of other staff members or individuals who are not Fund staff members in presenting the grievance to the Committee. [footnote omitted] At the conclusion of the case, if the Committee concludes that a grievance is well-founded in whole or in part, it may recommend that the Fund reimburse the grievant for some or all of the reasonable costs, including legal fees, actually incurred by the grievant in pursuing the grievance. In deciding whether to recommend reimbursement, the Committee shall take into account the nature and complexity of the case, the nature and quality of the work performed, and the reasonableness of the fees charged in relation to prevailing rates.”
- Management response and rationale:
  - Management did not accept the Committee’s recommendation for reimbursement and explained: “We are not in agreement with the contention of the Grievance Committee that you have been partially successful in your claims for relief, in light of the fact that no compensable harm was found, and no financial relief awarded. Therefore, we have decided that there is no basis to accept the Committee’s recommendation that you be reimbursed the amount of $22,141.50 in legal fees and costs.” (Letter from Special Advisor to Managing Director to Applicant, February 2, 2011, and cover email of February 3, 2011.)
- Tribunal reasoning:
  - The Grievance Committee is advisory and Management has authority to accept or reject its recommendations. See GAO No. 31, Sections 1 and 8.
  - Management gave reasons for rejecting the recommendation, which the Tribunal found were not arbitrary or improperly motivated.
  - Therefore, the Tribunal could not sustain Applicant’s claim that Management abused its discretion in declining partial reimbursement.

### Tribunal authority and practice on awarding costs
- Jurisprudence summarized:
  - The Tribunal has held it may award costs for an applicant’s legal representation in the underlying Grievance proceedings where the applicant succeeds before the Tribunal. See interpretations in Ms. “C” (Interpretation of Judgment No. 1997-1) and Mr. “V” (Judgment No. 1999-2).
  - The Tribunal quoted Article XIV, Section 4 of its Statute (quotation):
    - “4. If the Tribunal concludes that an application is well-founded in whole or in part, it may order that the reasonable costs incurred by the applicant in the case, including the cost of applicant's counsel, be totally or partially borne by the Fund, taking into account the nature and complexity of the case, the nature and quality of the work performed, and the amount of the fees in relation to prevailing rates.”
- Application to the instant case:
  - The Tribunal concluded it is not appropriate to award any costs to Applicant because she “has not had significant success on the legal submissions she has made to this Tribunal.”

### Decision
- The Administrative Tribunal of the International Monetary Fund unanimously decided:
  - The Application of Ms. Pyne is denied.
- Signatories and administrative details preserved exactly:
  - Catherine M. O’Regan, President
  - Michel Gentot, Judge
  - Andrés Rigo Sureda, Judge
  - Catherine M. O’Regan, President (signature block)
  - Celia Goldman, Registrar (signature block)
  - Washington, D.C.
  - November 14, 2011

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_Source: https://www.imf.org/-/media/files/imfat/j2011-2.pdf_