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July 24, 1972

Jean CHRISTIAN and Victor L. Green, individually and on behalf of all others similarly situated, Plaintiffs,

The opinion of the court was delivered by: BAUMAN

BAUMAN, District Judge.

This action tests the constitutionality of the Federal statutory scheme providing unemployment compensation benefits for former Federal employees as it is applied to those who at the time of termination of their Federal employment were in a probationary status. The principal issue is whether the provisions of 5 U.S.C. § 8506 *fn1" and the regulations promulgated thereunder, which make the findings of the former Federal employer as to the reasons for termination binding and conclusive upon the State agency in its determination of eligibility for unemployment compensation benefits, violate the Due Process Clause of the Fifth and Fourteenth Amendments and the Equal Protection Clause of the Fourteenth Amendment.

This case came on before Judge Frankel for declaratory relief, injunctive relief and a writ of mandamus. As the constitutionality of a Federal statute was seriously in doubt, Judge Frankel invoked a Three-Judge Court pursuant to 28 U.S.C. § 2282.


 Plaintiff Jean Christian is a resident of Brooklyn, New York and a former employee of the United States Post Office *fn2" in Brooklyn. Plaintiff Victor L. Green is a resident of the Bronx, New York and a former employee of the United States Department of The Treasury, Bureau of Customs, based in New York. Both plaintiffs were probationary employees when their employment was terminated. Plaintiff Christian was employed by the Post Office Department from April 4, 1970 to October 2, 1970 and was discharged because of an unsatisfactory attendance record. Plaintiff Green was a sky marshal for the Bureau of Customs from December 24, 1970 to December 18, 1971, when he was discharged for drinking an alcoholic beverage within twenty-four hours of flying. Neither plaintiff was given a prior hearing nor was one required.

 Title 5 U.S.C. § 8501 et seq. *fn3" authorizes the United States Department of Labor to enter into agreements with State agencies to provide unemployment compensation for former Federal employees under the Unemployment Compensation for Federal Employees (UCFE) Program. The statutory scheme includes a provision that the written statement of the former Federal employer as to the reasons for termination of an employee are binding and conclusive on the State agency which administers the UCFE program. 5 U.S.C. § 8506. Such an agreement was entered into by the Secretary of Labor and the State of New York. Both plaintiffs filed claims for unemployment compensation with the New York State Department of Labor which is the administering agency. After proceeding through the appropriate State procedures each plaintiff received a final determination denying him benefits based on the written, conclusive statements of his former Federal employer.

 As probationary employees, neither plaintiff was entitled to a hearing before his Federal agency employer prior to termination of employment. *fn4" Therefore, neither had an opportunity to contest, avoid or rebut the written reasons for his dismissal. Because the Federal findings were binding on the State agency, plaintiffs claim that they have been denied unemployment compensation benefits without due process of law and in violation of their rights to equal protection of the laws.


 Prior to addressing the constitutional questions, this Court must face the claim *fn5" that the interpretation of 5 U.S.C. § 8506 set forth in Smith v. District Unemployment Compensation Board, 140 U.S. App. D.C. 361, 435 F.2d 433 (1970) is the correct one. If it is, mandamus will lie against the Federal officials directing them to provide hearings, upon request, to probationary employees who contest the reasons given for their termination.

 We refuse to follow the construction of 5 U.S.C. § 8506 set forth in Smith, supra. That Court found --


"There is no reasonable basis for supposing that whereas Congress deliberately insisted on opportunity of hearing for employees generally, it deliberately established a no-hearing enclave for a relatively small group of Federal employees . . .." Supra 435 F.2d at 438.

 In reaching that conclusion, we think that the Court ignored the structure of the Federal Civil Service Laws. Since the original Civil Service Act of 1883, Congress has made a distinction between probationary and permanent Government employees. *fn6" Probationary employees are not entitled to the full range of hearing rights to which permanent employees are entitled upon dismissal. *fn7" This distinction between probationary and permanent Government employees has been recognized by the Courts on many occasions *fn8" and Congress surely was aware of it in 1954 when it passed the legislation creating the UCFE Program.

 Certainly Congress intended that Federal employers should have an unfettered right to terminate probationary employees. No termination hearing is prescribed or required nor should it be. What Smith, supra, attempts is to legislate judicially a hearing not now required by statute which would mandate precisely the type of hearing not now required for discharge. Such a hearing, as a practical matter, would limit the Government in the discharge of probationary employees to an extent never previously contemplated by the Congress.

 Additionally, the idea that the use of the word "findings" in 5 U.S.C. § 8506 means "findings after a hearing" is a tortured, strained and unnecessary interpretation. We hold that the word "findings" in 5 U.S.C. § 8506 means only the written statement of reasons for termination sent by the Federal employer to the State agency administering the UCFE program. Had the Congress meant otherwise it would have said so.


 Having disposed of the statutory claim, we now proceed to the constitutional claims. In this connection, defendants have interposed the threshold defense of lack of subject matter jurisdiction. In the case of the Federal defendants this defense must be sustained.

 Plaintiffs have not met the jurisdictional requirements under 28 U.S.C. §§ 1331, 1337 or 1346, the so-called "federal question" jurisdiction sections. As neither the Declaratory Judgment Act, 28 U.S.C. §§ 2201, 2202, nor the provisions for invoking a Three-Judge Court, 28 U.S.C. § 2282, provide subject matter jurisdiction in and of themselves, an additional statutory basis must be alleged. There are no such allegations. The so-called "civil rights" statute, 42 U.S.C. § 1983 applies to State, not Federal officials.

 The only statutory basis for jurisdiction over the dispute between the plaintiffs and the Federal defendants alleged in the complaint is 28 U.S.C. § 1361, the mandamus remedy, which has been found lacking in merit, supra.

 However, the situation is different as to the State defendants. Plaintiffs have properly based their claim on 42 U.S.C. § 1983 and 28 U.S.C. § 1343. The gist of the complaint against the State defendants is that their application of the Federal law in administering the UCFE program has denied the plaintiffs of unemployment compensation benefits without due process of law and in violation of their right to equal protection of the laws.

 Ayala v. District 60 School Board, 327 F. Supp. 980 (D. Colo. 1971) illuminates the issue. As the Court there said (at p. 981):


"Since plaintiffs in this action claim that their right to equal protection of the laws has been denied by Colorado officials, acting in their capacities as officials, this court clearly has jurisdiction to hear the constitutional claim and, should plaintiffs be successful, to grant the relief sought. It makes no difference that plaintiffs have not cited a state or local law upon which the defendants' conduct may be based. It is settled that the phrase 'under color of' comprehends all official behavior, even that which is patently unlawful under state, as well as federal, law."


 The State defendants assert that the alleged constitutional violations claimed by plaintiffs do not state a claim upon which relief can be granted. We agree.

 Plaintiffs urge that the State defendants, in applying 5 U.S.C. § 8506 to deny them unemployment compensation benefits without a hearing, have violated the equal protection clause of the Fourteenth Amendment. That violation allegedly results from treating former probationary employees in a manner different from all other applicants for unemployment compensation.

 To reiterate what we have previously stated, Congress had good reason to differentiate between probationary and permanent employees in trying to promote the efficient disposition of Federal business. As the purpose of such classification is legitimate and the means adopted by Congress rational, there is no denial of equal protection. Cf. Dandridge v. Williams, 397 U.S. 471, 485, 90 S. Ct. 1153, 25 L. Ed. 2d 491 (1970).

 The other constitutional issue is whether a denial of unemployment compensation benefits without a hearing violates the due process clause of the Fourteenth Amendment. This is resolved by striking a balance between the loss to the claimant resulting from a denial of such a hearing and the Government's interest in summary adjudication of claims. Goldberg v. Kelly, 397 U.S. 254, 90 S. Ct. 1011, 25 L. Ed. 2d 287 (1970). In Goldberg, supra, the Supreme Court held that an evidentiary hearing was required before welfare payments could be terminated, but the factual distinctions between Goldberg and the case at bar compel the conclusion that the Government's interest in summary adjudication outweighs plaintiffs' need for a hearing here.

 Welfare programs, such as aid to families with dependent children, *fn9" are designed to meet a different need than unemployment compensation. Such payments are designed to provide the recipient with essential food, clothing and shelter. Goldberg, supra, at 264, 90 S. Ct. 1011. Need is not the criterion for eligibility under the unemployment compensation programs. *fn10" Compensation is available as a matter of right to involuntarily unemployed workers and benefits are based on wages previously received by the claimant without relation to need. In fact, if an unemployed person is declared ineligible for unemployment compensation benefits he may nonetheless qualify for welfare payments on the basis of his need. The plain fact is that unemployment compensation benefits are not as crucial to the survival of the claimant as are welfare benefits.

 Goldberg, supra, also holds that recipients already receiving benefits are entitled to a hearing before termination of those benefits. In the case at bar plaintiffs have not received benefits but have only applied for them. In fact, a three-Judge panel of this Court has held that the suspension or termination without a prior hearing of unemployment compensation benefits already being paid without a prior hearing is not violative of the Fourteenth Amendment. Torres v. New York State Department of Labor, 321 F. Supp. 432 (S.D.N.Y. 1971), vacated and remanded, 402 U.S. 968, 91 S. Ct. 1685, 29 L. Ed. 2d 133 (1971), previous decision adhered to, 333 F. Supp. 341 (S.D.N.Y. 1971). That Court pointed out that the "brutal need" of the welfare recipients in Goldberg was not present in circumstances involving recipients of unemployment compensation. The same Government interest in the efficient operation of the unemployment compensation program which was present in Torres, is present here. On balance, the interests of the Government outweigh plaintiffs' need for a hearing and so the due process claim cannot be sustained.

 Given the above disposition of the case it is not necessary to reach a decision as to whether plaintiffs' suit is properly brought as a class action. The action is dismissed.

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