Employee Indemnification Regulations

AGENCY:

Corporation for National and Community Service.

ACTION:

Proposed rule with request for comments.

SUMMARY:

The Corporation for National and Community Service, operating as AmeriCorps (AmeriCorps), proposes to adopt regulations to indemnify AmeriCorps employees who, because of conduct taken within the scope of employment with AmeriCorps, have a verdict, judgment, monetary award, or personal damages claim issued against them that is not otherwise covered by the Federal Tort Claims Act. These proposed regulations set out how AmeriCorps employees may request indemnification or settlement of a claim and the circumstances in which AmeriCorps may approve indemnification or settlement of a claim.

DATES:

Comments must reach AmeriCorps on or before July 25, 2022.

ADDRESSES:

You may submit comments by any of the following methods:

(1) Electronically through www.regulations.gov.

(2) By mail sent to: AmeriCorps; Attention Kiara Rhodes, 250 E Street SW, Washington, DC, 20525.

(3) By hand delivery or by courier to the CNCS mailroom at the address above between 9 a.m. and 4 p.m. Eastern Time, Monday through Friday, except Federal holidays.

Comments submitted in response to this proposed rule will be made available to the public through www.regulations.gov. For this reason, please do not include in your comments information of a confidential nature, such as sensitive personal information or proprietary information. If you send an email comment, your email address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the internet. Please note that responses to this public comment request containing any routine notice about the confidentiality of the communication will be treated as public comments that may be made available to the public notwithstanding the inclusion of the routine notice.

FOR FURTHER INFORMATION CONTACT:

Kiara Rhodes, Associate General Counsel, Corporation for National and Community Service, 250 E Street SW, Washington, DC 20525, PublicComments@cns.gov, 202-606-6709.

SUPPLEMENTARY INFORMATION:

I. Background

AmeriCorps proposes to adopt employee indemnification regulations for circumstances not covered by the Federal Employee Liability Reform and Tort Compensation Act of 1988 (FELRTCA), 28 U.S.C. 2679(b)(1), or the Federal Tort Claims Act (FTCA), 28 U.S.C. 1346(b). FELRTCA provides that, with certain exceptions, the FTCA is the exclusive remedy for injuries caused by a Federal employee acting in the scope of employment, such that the United States must be substituted as the defendant and the claim must proceed against the Government under the FTCA. See 28 U.S.C. 2679(b)(1). The exceptions, for which substitution is not available, are claims brought for a violation of the Constitution and claims authorized by and brought for a violation of a Federal statute. See 28 U.S.C. 2679(b)(2). In these claims, the individual is sued in their personal capacity. For instance, lawsuits against Federal employees in their personal capacities for alleged constitutional violations are available under certain circumstances since the Supreme Court's decision in Bivens v. Six Unknown Named Agents of the Federal Bureau of Narcotics, 403 U.S. 388 (1971). The Bivens decision was the first time that the Supreme Court recognized an implied cause of action directly under the Constitution for personal-capacity claims for alleged constitutional violations. In rare circumstances, even a State or common law claim might be brought against a Federal employee for whom the United States has formally substituted itself, but for which a court rejected substitution, and in these cases too, the individual could be liable in their personal capacity.

AmeriCorps believes that actions against its employees in their personal capacities and the potential for a judgment against agency employees may hinder the agency's effectiveness in meeting its mission. AmeriCorps employees' ability to carry out functions related to volunteer management and grant-making depends on the willingness of the employees to make decisions and take actions that may expose them to liability. Uncertainty regarding the potential for a personal liability claim resulting in monetary judgment may intimidate employees, stifle creativity and initiative, and limit decisive action. The threat of personal liability for a decision made or action taken as part of official duties can adversely affect AmeriCorps' achievement of its mission. The adoption of these regulations permitting indemnification would afford AmeriCorps employees the same protection given to Federal employees in several other government agencies, including the Federal Trade Commission, Agency for International Development, Commodity Futures Trading Commission, Department of Commerce, Department of Education, Department of Health and Human Services, Department of the Interior, and the Department of Justice.

The rule being proposed here would address these situations when an AmeriCorps employee is sued in their personal capacity for conduct performed in the scope of their employment, by providing the process for AmeriCorps employees to request indemnification or settlement of a claim and the circumstances in which AmeriCorps may approve indemnification or settlement of a claim.

II. Scope of Proposed Rule

The proposed rule would allow AmeriCorps to indemnify a present or former AmeriCorps employee who is personally named as a defendant in a legal proceeding for conduct arising within the scope of their employment when the FTCA does not apply because (1) the claim alleges the conduct is a violation of the Constitution; or (2) the claim alleges a violation of a Federal statute that authorizes the claim; or (3) the claim is brought under State or common law against a Federal employee for whom the United States has formally substituted itself, but for which a court rejected substitution. The regulations would permit AmeriCorps to indemnify an Agency employee who suffers an adverse verdict, judgment, or other monetary award, provided that the actions giving rise to the judgment were taken within the scope of employment, and that AmeriCorps determines that the indemnification is in its interest. The regulations would also allow AmeriCorps to settle a claim brought against an employee in their individual capacity by the payment of funds, upon a similar determination. Generally, AmeriCorps will not entertain a request to indemnify a personal damage claim against an employee before entry of an adverse verdict, judgment, or monetary award. However, in certain cases, AmeriCorps may determine that exceptional circumstances justify the earlier indemnification or payment of a settlement amount. The proposed rule would provide procedures for present or former AmeriCorps employees to follow if they are personally named in these types of lawsuits and wish to be indemnified, and also would provide procedures for AmeriCorps' review of requests for indemnification.

AmeriCorps welcomes public comment on the proposed regulations, particularly on the scope of the proposed rule and its applicability to Agency employees. AmeriCorps' intent is to provide an avenue to employee indemnification—at the Agency's sole discretion—for circumstances not covered by the FELRTCA or FTCA.

III. Regulatory Analyses

A. Executive Orders 12866 and 13563

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. The Office of Information and Regulatory Affairs in the Office of Management and Budget does not anticipate that this will be a significant regulatory action.

B. Congressional Review Act (Small Business Regulatory Enforcement Fairness Act of 1996, Title II, Subtitle E)

As required by the Congressional Review Act (5 U.S.C. 801-808) before an interim or final rule takes effect, AmeriCorps will submit for an interim or final rule a report to each chamber of the Congress and to the Comptroller General of the United States. A major rule cannot take effect until 60 days after it is published in the Federal Register . The Office of Information and Regulatory Affairs in the Office of Management and Budget anticipates that this will not be a major rule under 5 U.S.C. 804 because this rule will not result in (1) an annual effect on the economy of $100 million or more; (2) a major increase in costs or prices for consumers, individual industries, Federal, state, or local government agencies, or geographic regions; or (3) significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets.

C. Regulatory Flexibility Act

As required by the Regulatory Flexibility Act of 1980 (5 U.S.C. 601 et seq. ), AmeriCorps certifies that this proposed rule, if adopted, will not have a significant economic impact on a substantial number of small entities. Therefore, AmeriCorps has not performed the initial regulatory flexibility analysis that is required under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) for rules that are expected to have such results.

D. Unfunded Mandates Reform Act of 1995

For purposes of Title II of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1531-1538, as well as Executive Order 12875, this regulatory action does not contain any Federal mandate that may result in increased expenditures in either Federal, State, local, or Tribal governments in the aggregate, or impose an annual burden exceeding $100 million on the private sector.

E. Paperwork Reduction Act

Under the PRA, an agency may not conduct or sponsor a collection of information unless the collections of information display valid control numbers. This proposed rule does not contain information collection requirements within the meaning of the Paperwork Reduction Act, 44 U.S.C. 3501-3520.

F. Executive Order 13132, Federalism

Executive Order 13132, Federalism, prohibits an agency from publishing any rule that has Federalism implications if the rule imposes substantial direct compliance costs on State and local governments and is not required by statute, or the rule preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive Order. This proposed rule does not have any Federalism implications, as described above.

G. Takings (E.O. 12630)

This proposed rule does not affect a taking of private property or otherwise have taking implications under Executive Order 12630 because this proposed rule does not affect individual property rights protected by the Fifth Amendment or involve a compensable “taking.” A takings implication assessment is not required.

H. Civil Justice Reform (E.O. 12988)

This proposed rule complies with the requirements of Executive Order 12988. Specifically, this proposed rule: (a) Meets the criteria of section 3(a) requiring that all regulations be reviewed to eliminate errors and ambiguity and be written to minimize litigation; and (b) meets the criteria of section 3(b)(2) requiring that all regulations be written in clear language and contain clear legal standards.

I. Consultation With Indian Tribes (E.O. 13175)

AmeriCorps recognizes the inherent sovereignty of Indian Tribes and their right to self-governance. We have evaluated this proposed rule under the AmeriCorps consultation policy and the criteria in E.O. 13175 and determined that this proposed rule does not impose substantial direct effects on federally recognized Tribes.

J. Clarity of This Regulation

We are required by Executive orders 12866 (section 1(b)(12)), and 12988 (section 3(b)(1)(B)), and 13563 (section 1(a)), and by the Presidential Memorandum of June 1, 1998, to write all rules in plain language. This means that each proposed rule we publish must: (a) Be logically organized; (b) use the active voice to address readers directly; (c) use clear language rather than jargon; (d) be divided into short sections and sentences; and (e) use lists and tables wherever possible. If you feel that we have not met these requirements, please send us comments by one of the methods listed in the ADDRESSES section. To help us revise the proposed rule, your comments should be as specific as possible.

List of Subjects in 25 CFR Part 2502

• Administrative practice and procedure
• Government employees
• Indemnity payments

For the reasons discussed in the preamble, under the authority of 42 U.S.C. 12651c(c), the Corporation for National and Community Service proposes to amend chapter XXV of title 45 of the Code of Federal Regulations by adding part 2502 to read as follows:

PART 2502—EMPLOYEE INDEMNIFICATION REGULATIONS

Authority: 28 U.S.C. 2679(b)(1); 42 U.S.C. 12651c(c).