Few things feel more final than a federal removal, suspension, or demotion. But for many employees, a clean record settlement agreement can be the difference between a career-ending action and a new beginning.

At the National Security Law Firm (NSLF), we negotiate, draft, and enforce clean record settlements for federal employees nationwide. Our attorneys are former federal insiders — senior counsel from DHS, TSA, CBP, and other agencies — who understand the bureaucracy from within. We know how records are stored, transmitted, and disclosed. That knowledge gives our clients a decisive advantage.

This guide explains how clean record agreements work, how to negotiate and enforce them effectively, and the legal limits you must understand before signing one.

What Is a Clean Record Settlement Agreement?

A Clean Record Settlement Agreement (CRA) is a contractual term in which a federal agency agrees to delete or modify negative employment information — such as a removal, suspension, or demotion — in exchange for resolving a pending appeal or grievance.

It’s one of the most common forms of settlement before the Merit Systems Protection Board (MSPB). In fact, the MSPB’s 2013 report found that more than two-thirds of all federal employment settlements include a clean record provision.

In practice, a clean record settlement can change your SF-50 to reflect a resignation for personal reasons, expunge decision letters, remove suspension entries, or rewrite the official reason for separation. It can save your career, pension, and reputation — if it’s done correctly.

Why Federal Employees Pursue Clean Record Agreements

Federal employees pursue clean record settlements to:

  • Prevent future employers from seeing negative disciplinary history.

  • Eliminate records that could impact security clearance or suitability adjudications.

  • Protect pension eligibility and disability retirement options.

  • Avoid public disclosure of damaging allegations.

The goal is not simply to “erase” history, but to restore employability and financial stability. A clean record settlement can turn a catastrophic removal into a neutral resignation — often with back pay or negotiated benefits.

How to Negotiate a Clean Record Settlement Effectively

1. Understand What Can Be Cleaned

Personnel records are distributed across multiple systems — your Official Personnel File (OPF), Employee Performance File (EPF), agency databases, and sometimes third-party contractors. Unless the agreement specifies every system to be cleaned, remnants of the disciplinary action may remain.

Agencies often claim they cannot alter certain systems, but precedent says otherwise.

  • King v. Department of the Navy: The obligation to “remove all reference” extended to OPM and DFAS databases.

  • Phillips v. Department of Homeland Security: The agency was held responsible for its private contractor’s failure to delete removal records.

NSLF tip: Always require language stating that all agency, component, and contractor systems of record will reflect the new personnel action.

2. Define Who Can Speak — and What They Can Say

Even if the record is cleaned, careless statements by agency personnel can undo the benefit.

The Federal Circuit has ruled that an agency promising a clean record must act as if the clean record is true.

  • In Pagan v. Department of Veterans Affairs, crossing out reference-check questions implied negativity and breached the agreement.

  • In Torres v. Department of Homeland Security, employees disclosed “resigned in lieu of removal,” which voided the CRA.

NSLF strategy: Specify who may respond to reference checks, limit their comments to neutral data (dates of service, title, and salary), and bar negative or implied statements.

3. Address Future Disclosures “Required by Law”

Certain inquiries legally require agencies to provide truthful information — for example, background checks, OWCP forms, or law enforcement certifications.

In Allen v. Department of Veterans Affairs, the agency disclosed disciplinary records to OWCP as required by law; the MSPB found no breach. But in Phillips v. DHS, the Board ruled that disclosure to a state unemployment office was not required and therefore violated the CRA.

NSLF tip: Use narrow language — authorize disclosures only when required by federal law, court order, or written regulation, and require notice to the employee before any such disclosure.

4. Anticipate Background Investigations

Even a “clean” record doesn’t override your duty to answer truthfully on security forms like the SF-85P or SF-86. The Office of Personnel Management (OPM) has stated that individuals must still answer “Yes” if they resigned after being told they would be fired — even if a settlement changed their record.

False answers can lead to removal or debarment, as seen in Pappas v. OPM, Forma v. DOJ, and Ly v. Treasury.

NSLF strategy: We advise clients on how to disclose settlements truthfully without triggering unnecessary red flags in background checks or clearance reviews.

5. Preserve Enforcement Rights

Every clean record agreement should be entered into the MSPB record for enforcement under 5 C.F.R. § 1201.182. This allows you to file a Petition for Enforcement (PFE) if the agency later breaches its obligations.

If a breach occurs, you can either:

  • Enforce the agreement (e.g., compel record correction), or

  • Rescind it and reinstate the underlying appeal.

Even a small violation — such as an unauthorized disclosure — can justify rescission. The MSPB has emphasized that employees need not show monetary loss to prove material breach.

When Clean Record Agreements Fail

While CRAs are powerful, they are not limitless. Several categories of agreements have been declared void or unenforceable under law or public policy.

1. Agreements Concealing Criminal or Security Misconduct

Agencies cannot contract away the duty to report crimes or suitability concerns.

  • Fomby-Denson v. Department of the Army: The Army’s promise to withhold criminal allegations was void as contrary to public policy.

  • Gizzarelli v. Department of the Army: Agencies cannot hide criminal misconduct from OPM during suitability checks.

2. Agreements That Conflict with Third-Party Authority

Agencies cannot bind entities such as OPM or Inspectors General.

  • Parker v. OPM and Stevenson v. OPM: OPM may disregard a CRA that artificially creates retirement eligibility.

  • Vance v. Department of the Interior: The agency could not stop its OIG from publishing an investigative report despite CRA confidentiality.

3. Agreements Involving False or Impossible Promises

A CRA cannot require false statements.

  • Lutz v. USPS: The agency agreed not to submit “negative” information but sent a disparaging supervisor’s statement to OPM — breach.

  • Miller v. USPS: The agency lawfully disclosed truthful information consistent with the record; no breach.

4. Agreements Based on Mutual Mistake

If both sides were mistaken about eligibility for retirement or other benefits, the CRA can be rescinded.

  • Thomas v. USPS and Garcia v. Air Force: Mutual mistakes of law or fact void settlements.

Clean Record Settlements in Suspensions, Demotions, and Removals

Clean record agreements are most often used to settle adverse actions — suspensions (over 14 days), demotions, and removals under 5 U.S.C. §§ 7511–7514.

Suspensions

Short suspensions can be replaced with reprimands or “no-fault” agreements, allowing the employee to retain pay and benefits.

Demotions

Demotions may be mitigated to voluntary downgrades with clean SF-50s showing reassignment or position reclassification.

Removals

A removal can be rewritten as a resignation for personal reasons, restoring eligibility for reinstatement or federal rehire.

NSLF’s attorneys routinely negotiate clean record outcomes that protect pension and clearance eligibility — sometimes converting removals to retirements or reassignments within weeks.

How NSLF Maximizes Case Value and Outcome

Our mission is not only to defend careers — it’s to maximize total case value. A properly negotiated clean record can preserve thousands in back pay, keep retirement intact, and protect future earning potential.

Because our attorneys once served as agency counsel, we understand the internal systems where records live. We know how to close every loophole and hold agencies accountable.

Why Choose Our Federal Employment Attorneys

At the National Security Law Firm, we are not civilian lawyers guessing how the system works — we are former federal insiders who helped design it.

  • Jeff Velasco, former Supervisory Attorney-Advisor at TSA, led one of the agency’s largest employment-law teams for over two decades.

  • Danielle Moora, former Senior Counsel for TSA and CBP, earned multiple DHS Secretary’s Awards for excellence in federal litigation.

  • Karen Hickey, DHS and FTC alumna, brings two decades of federal litigation and regulatory experience.

Our attorneys combine more than 60 years of federal service. They understand agency culture, penalty tables, and the hidden decision-making dynamics that determine whether a CRA holds up — or collapses.

We serve clients nationwide, offer flexible payment options through Pay Later by Affirm, and maintain a 4.9-star Google rating from hundreds of satisfied clients.

National Security Law Firm: It’s Our Turn to Fight for You.

Federal Employment Defense Resource Hub

For in-depth strategy guides, success stories, and case analyses, visit our Federal Employment Defense Hub.

You’ll find advanced content on topics like:

  • How to negotiate alternative discipline and clean record settlements

  • Insider tactics for winning at the MSPB

  • Strategies for responding to proposed removals and demotions

For additional guidance, see Finding the Best Federal Employment Lawyer — Why Local Isn’t Always Better.

Book a Free Consultation

A clean record settlement can save your career, but timing is everything. Once an adverse action becomes final, leverage decreases dramatically.

Our federal employment lawyers will evaluate your case, identify every possible settlement advantage, and guide you step by step through negotiation or enforcement.

👉 Book your free consultation or call 202-600-4996 to speak directly with an attorney today.

National Security Law Firm: It’s Our Turn to Fight for You.