Labor & Employment Law Daily Wrap Up, PUBLIC EMPLOYEES—D.C. Cir.: Teacher who resigned in settlement, rejected for rehire, fails to revive lawsuit, (Jul 9, 2025)

By Marjorie Johnson, J.D.

He alleged the D.C. public school system falsely asserted that he failed his background check as a “pretense” to reject his candidacy, and after he entered the settlement agreement, refused to effectuate his hiring in bad faith.

A gym teacher formerly employed by the District of Columbia Public Schools (DCPS) failed to plausibly allege that the government breached a settlement agreement whereby, in exchange for his agreement to resign, DCPS agreed to allow him to “apply” for future positions and remove any reference to a “substantiated sexual harassment allegation” from his personnel folder. Though he argued that that DCPS blocked his rehiring in bad faith and falsely claimed he failed the background check, his demand for “fair consideration” of his employment applications had no basis in the contract’s language or the law, and he also failed to plausibly allege that the government deprived him of property and liberty without due process of law, a divided three-member panel of the D.C. Circuit ruled (McKinney v. District of Columbia, No. 24-7-27 (D.C. Cir. July 8, 2025)).

Appealed failed background checks. In 2015, DCPS hired the health and physical-education teacher. Though he had failed a background check, he successfully appealed that decision and then taught in D.C. public schools without incident for three years. In the summer of 2019, he received a conditional offer to teach at a DCPS middle school, but he was subsequently advised that he was ineligible since he failed a background check. He again appealed and prevailed, but by that time the position was no longer available.

Sexual harassment investigation. Meanwhile, DCPS investigated him for sexual harassment, and he filed a grievance against DCPS. The parties resolved both disputes by entering a settlement agreement in the fall of 2019, under which he agreed to resign from DCPS and DCPS agreed to remove any reference to a “substantiated sexual harassment allegation” from his personnel folder.

Settlement agreement. Under the settlement agreement, he was deemed “excessed” pursuant to the union’s collective bargaining agreement (CBA). Normally, a teacher who is “excessed” before qualifying for retirement benefits has two options: (1) take a $25,000 buyout and surrender eligibility for reemployment for three years; or (2) remain employed for an additional year, during which time the teacher may seek to secure reemployment so that there is no break in service for pension purposes. But under the terms of the settlement agreement, he received a $25,000 buyout without foregoing eligibility for reemployment for three years, and he was also “allowed to apply for teaching positions at DCPS starting the 2020–2021 school year.” If he were rehired within a year of signing the agreement, he would be treated as having no break in service for purposes of his pension, salary eligibility, and forfeited sick leave.

Denied rehire. Although he applied for several different teaching positions in 2020 and 2021 and received some conditional offers, he was neve rehired because he allegedly failed a background check. He claimed, however, that no background check was ever conducted and that DCPS personnel were instructed not to effectuate his hiring.

Breach of contract. The D.C. Circuit first found that the district court properly dismissed the teacher’s claim that DCPS breached the settlement agreement’s implied covenant of good faith and fair dealing. In particular, he argued that the settlement agreement’s provision that “allowed” him to “apply for teaching positions” necessarily obligated DCPS to fairly consider any employment applications that he submitted, and that DCPS blocked his rehiring in bad faith and falsely claimed that he failed the background check. But his demand for “fair consideration” of his employment applications had no basis in the contract’s language or in the law.

Notably, the settlement agreement said only that the teacher is “allowed to apply for teaching positions,” and this provision’s evident purpose was to exempt the teacher from the CBA’s buyout disqualification, which otherwise would have rendered him teacher ineligible for employment for three years because he had accepted the $25,000 buyout. The contract did not, however, entitle him to “fair consideration” of subsequent applications for teaching positions, and it was “unreasonable and unjustified” for him to expect special treatment from DCPS in its consideration of his post-settlement employment applications, especially when his expectation was based solely on a contract provision that facially gave him only a right to apply. Thus, DCPS’s alleged failure to fairly consider his applications in the later stages of the hiring process was beyond the scope of the agreement.

Not deprived of property interest. The D.C. Circuit also rejected his contention that DCPS deprived him, without proper procedural due process, of his property interests in jobs that were conditionally offered to him before he was blocked by the allegedly failed background checks. First, he did not have a property interest in the jobs since the offers were contingent on the outcome of a statutorily required background check, which was “an important, statutorily mandated hurdle.” Thus, because the job offers did not (and could not) guarantee that he would be hired, he had no claim of entitlement and no constitutionally protected property interest.

The court also squarely rejected his contention that he had a protected interest in his eligibility for DCPS employment, noting that DCPS could not have contractually made such a guarantee since, without knowing whether he would pass the mandatory background check, it could not promise that he would be eligible to be hired in the future.

“Automatic-exclusion” claim failed. His claim that DCPS deprived him of his liberty interest without due process by automatically excluding him from any teaching job with DCPS also failed. Central to his theory of the case was his allegation that DCPS never actually conducted a background check on him in 2020 or 2021. He thus never claimed he was actually disqualified. Rather, he alleged DCPS falsely asserted that he had failed his background check as a “pretense” to reject his candidacy and in bad faith generally refused to effectuate his hiring after he entered the settlement agreement. This did not amount to the requisite “tangible change in status” or “binding disqualification” as required by case law.

Dissent. Judge Pillard agreed that the teacher failed to identify a property interest but argued that the teacher’s allegations that DCPS summarily rejected his applications without following its own application-review process sufficed to state a claim of breach of the contractual duty of good faith and fair dealing. Pillard also found that his allegations that DCPS automatically excluded him from teaching positions in the DC public schools by baselessly designating him a “present danger to children and youth” sufficed to identify a protected liberty interest for purposes of his due process claim—an argument that the majority squarely rejected.

The case is No. 24-7027.

Judge: Pan, F.

Attorneys: Leslie McAdoo Gordon (McAdoo Gordon & Associates) for Darian McKinney. Holly Michelle Johnson, Office of the Attorney General, for District of Columbia.

Companies: District of Columbia

Cases: ContractClaims IndividualRights PublicEmployees DistrictofColumbiaNews