Whistleblower Law Blog
Topic: Administrative Review Board (ARB)
Tenth Circuit Court of Appeals Upholds ARB Decision in Favor of Truck Driver Who was Fired After He Abandoned His Disabled Vehicle to Avoid Freezing to Death
In a recent case before the United States Court of Appeals for the Tenth Circuit, the Court upheld an Administrative Review Board (ARB) decision finding that a truck driver was terminated in violation of the whistleblower provisions of the Surface Transportation Assistance Act (STAA). The truck driver, Alphonse Maddin, unhitched his truck from a trailer and drove away to avoid freezing to death after the brakes on the trailer froze due and roadside assistance failed to respond. Maddin had reported to his employer, TransAm Trucking, both the condition of the trailer and the threat to his health due to the freezing weather conditions. The Court held that Maddin had engaged in protected activity under the STAA by reporting the frozen brakes and the threat to his health; and that the driver’s termination for leaving the trailer to seek safety violated the whistleblower protection provisions of the STAA.
In a recent case in the U.S. District Court for the Eastern District of Michigan, the court denied Grand Trunk Railroad’s Motion to Dismiss, holding that a plaintiff may pursue a Federal Railroad Safety Act (FRSA) whistleblower retaliation claim in federal court, even after he has pursued the same claim administratively with the Department of Labor. The court held that pursuing remedies in both venues did not constitute bad faith on the part of the complainant, did not present a res judicata (claim preclusion) issue, and did not violate the due process rights of the defendant railroad. This case is important because it affirms the options available to a whistleblower to fully adjudicate claims of unlawful retaliation.
The Department of Labor’s Administrative Review Board affirmed an Administrative Law Judge’s (ALJ) decision that found the following: Timothy Dietz reported violations of the federal mail and wire fraud statutes to his former employer Cypress Semiconductor Corporation and, in retaliation, Cypress placed an undeserved disciplinary memo in his personnel file, and then constructively discharged him, thereby violating the whistleblower provision of the Sarbanes-Oxley Act (SOX). The ARB’s decision was issued in Dietz v. Cypress Semiconductor Corp., ARB Case No. 15-017, ALJ Case No. 2014-SOX-002
In April 2016, the Department of Labor’s Administrative Review Board (ARB) settled a twenty-year dispute in Office of Federal Contract Compliance Programs, United States Department of Labor v. Bank of America. Judge Luis A. Corchado authored the ARB opinion affirming an Administrative Law Judge’s (ALJ) August 2004 ruling regarding discriminatory hiring practices allegedly used by Bank of America (BOA) to exclude African American applicants in 1993. But relying on statistical analysis, Judge Corchado reversed the ALJ’s ruling that BOA utilized similar discriminatory hiring practices between 2002 and 2005. Judge Corchado’s opinion defined the contours of legally persuasive statistical analysis.The ARB cited a long-established principle regarding the role of statistical analysis in employment discrimination cases: “[S]tatistical evidence may be used to rule out chance.” Bank of America, ARB No. 13-099, LJ No. 1997-OFC-016 slip op. at 13 (ARB April 21, 2016)(Corchado L.). Courts have consistently considered disparities exceeding two standard deviations to be significant. And the more extreme the statistical disparity, the less additional evidence a Plaintiff need present to prove that racial discrimination caused the variation.
DOL Administrative Review Board Member Calls for ARB to Determine Whether Mandatory Arbitration Agreements Apply to Whistleblower Cases
In a recent case before the Department of Labor’s Administrative Review Board, which is the appellate body within the DOL that issues final agency decisions, Judge Luis Corchado, in his concurrence, called for the ARB to decide whether whistleblower laws enforced by the DOL, such as AIR 21 (protecting airline employees) or Sarbanes-Oxley (protecting those who disclose securities violations), can be subjected to mandatory arbitration. A holding that definitively determined that all whistleblower anti-retaliation claims could be subjected to mandatory arbitration would likely have detrimental effects in furthering the purposes of those laws.
Under mandatory arbitration provisions, typically seen in employment agreements or settlement agreements after litigation, parties agree that legal claims that could be pursued in court or administrative bodies must instead be submitted to a private arbitrator. The outcomes of such cases are almost always confidential. Further, in most arbitration, the arbitrator’s decision is final and is immune from appeal to a court absent a showing of extraordinary circumstances. Arbitration often serves to promote judicial economy by reducing litigation costs and lessening judges’ caseloads. But because of its inherently private nature, arbitration can also conceal wrongdoing from public knowledge.
On March 20, 2015, the Department of Labor Administrative Review Board (ARB) reversed and remanded a decision by the DOL’s Office of Administrative Law Judges (OALJ) that held a railroad employee had not proved that his report of a workplace injury was a contributing factor to management’s decision to terminate his employment.
Robert Powers reported to his employer, Union Pacific Railroad Company, that he injured his hand while operating a rail saw at work in May 2007. Over slightly more than a year, Powers saw several doctors who prescribed various treatments. His doctors also imposed a series of work restrictions, including limits on lifting and repetitive motions.
Union Pacific became suspicious about Powers’ reported injuries and resultant work restrictions. The company hired a private investigator who filmed Powers performing tasks around his property, including using a sledgehammer and carrying boxes of ammunition. After an internal administrative procedure that determined that Powers had violated the company’s dishonesty policy and had failed to stay within his medical restrictions, the company terminated Powers’ employment.
In Willbanks v. Atlas Air Worldwide Holdings, Inc. et al., the Administrative Review Board for the U.S. Department of Labor ruled that airline workers are transportation workers and thus exempt from the arbitration requirements of the Federal Arbitration Act. The ARB ruling reversed an Administrative Law Judge’s grant of a motion to stay proceedings pending arbitration,.
The FAA provides that arbitration agreements are valid unless grounds exist for revoking the agreement. But the FAA specifically exempts contracts for the employment of “seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” In its ruling, the ARB acknowledged that the FAA should be interpreted liberally to favor arbitration, and that any exceptions should be viewed narrowly.
Although the Department of Labor’s Administrative Review Board affirmed the dismissal of James Speegle’s whistleblower retaliation complaint, his case cemented a new standard for employees to meet when they invoke the “same decision” defense. In previous posts on May 15, 2014, September 3, 2014, and January 13, 2015, we discussed the Speegle standard and the burden it places on employers. Under Speegle, when an employer uses the “same decision” defense (arguing that it would have taken the same adverse action against an employee in the absence of his protected activity), the administrative judge must examine the defense by excising both the protected activity and the entangled facts from consideration.
In Speegle, the complainant and other supervisors had expressed concerns about Stone & Webster’s use of apprentices to apply paint coatings in a nuclear plant. Stone & Webster fired Speegle, ostensibly for insubordination after his obscene outburst at a meeting. The case then moved back and forth between DOL’s Office of Administrative Law Judges (the ALJ), the ARB, and the Eleventh Circuit, eventually establishing the present standard.
On March 20, 2015, the U.S. Department of Labor’s Administrative Review Board affirmed an Administrative Law Judge’s holding in Jackson v. Union Pacific Railroad Co., finding that sending an employee home to obtain a medical release can constitute an actionable adverse employment action.
On August 29, 2011, Union Pacific Railroad switchman/brakeman Michael A. Jackson reported to his manager a foul smoky odor in Union’s freight yard outside Avondale, Louisiana. When Jackson, because of health and safety concerns, requested assignment to an area free from smoke, his supervisor told Jackson to go home and return to work only after obtaining a medical release.
On December 1, 2011, Jackson filed a complaint with the DOL’s Occupational Safety and Health Administration, seeking damages because he had been temporarily suspended from work after raising health and safety concerns.
Concluding that Union violated the Federal Railroad Safety Act’s whistleblower protection provision, an ALJ awarded Jackson compensatory damages. The ARB, affirming OSHA’s decision, determined that Jackson engaged in protected activity when he reported safety concerns concerning foul smoky air to his manager.
The ARB’s finding—that Jackson was constructively discharged because he did not ask to go home—likely has broad implications for employees who face adverse actions for reporting health and safety concerns. The ARB’s decision affirms that the health and safety of our nation’s workforce is a top priority.
The U.S. Court of Appeals for the Sixth Circuit recently ruled that federal statutes do not protect a job applicant from retaliation by a prospective employer based on whistleblowing at a previous employer. The decision puts the Court at odds with long-standing agency interpretation of the Energy Reorganization Act (ERA) by the Department of Labor (DOL), as well as assumptions underlying decisions in several other federal circuit Courts of Appeals. Gary Vander Boegh worked for the Department of Energy (DOE) for many years as landfill manager at the Paducha Gaseous Diffusion Plant (PDGP) under WESKEM, LLC, a subcontractor to Bechtel Jacobs Company (BJC). While working for WESKEM, Vander Boegh engaged in a range of protected whistleblowing, including reporting environmental violations. In 2005, DOE awarded the PGDP contract to Paducah Remediation Services, LLC (PRS). EnergySolutions subcontracted with PRS to provide waste management services. Vander Boegh applied to EnergySolutions to remain the landfill manager, but EnergySolutions hired another candidate. Vander Boegh filed a complaint against BJC, PRS, and EnergySolutions with DOL, alleging retaliation for prior protected conduct in violation of six federal statutes.
After the Sixth Circuit remanded a previous appeal by Vander Boegh, the district court again granted summary judgment to the one remaining defendant, EnergySolutions, holding that Vander Boegh lacked standing because he was an applicant and not an employee of EnergySolutions. On appeal, the Sixth Circuit affirmed, finding that Vander Boegh lacked standing under the ERA and the False Claims Act (FCA), and that the court thus did not have subject matter jurisdiction over Vander Boegh’s claims under four other federal environmental statutes: The Safe Drinking Water Act (SDWA), 42 U.S.C. § 300j-9(i); the Clean Water Act (CWA), 33 U.S.C. § 1367; the Toxic Substances Control Act (TSCA), 15 U.S.C. § 2622; and the Solid Waste Disposal Act (SWDA), 42 U.S.C. § 6971.
In its opinion filed on November 18, 2014, the Sixth Circuit noted that the Third Circuit had “assumed, without deciding, that applicants are employees under the ERA,” but declined to follow the Third Circuit’s reasoning. Vander Boegh argued that the term “employee” is ambiguous and the Court should thus apply Chevron deference to DOL’s interpretation of the term in the ERA and adopt the agency’s long-standing interpretation. But the Court reasoned that since the term “employer,” but not “employee,” was defined in the statute, it should be guided by the dictionary definition of “employee.” With that reasoning, the Court endorsed the following definitions of “employee” under the ERA: “[s]omeone who works in the service of another person (the employer) under an express or implied contract of hire, under which the employer has the right to control the details of work performance,” and “[a] person working for another person or a business firm for pay.”
The Court concluded that, by these definitions, Vander Boegh was not an employee because he never worked for EnergySolutions. It added that Congress had included, in its ERA definition of employer, “applicants” for Nuclear Regulatory Commission licenses, indicating that had it intended to include applicants within the definition of “employee,” it would have. The Court added that courts should “presume Congress intended a term to have its settled, common-law definition” absent a contrary indication in the statute.
But the Court did not address two other viable theories of statutory interpretation. The first is that Congress simply failed to define the term “employee” in the ERA, thus creating a statute with ambiguous language. The accepted doctrine of Chevron deference to agency interpretation in such instances would carry no weight if Congress intended Courts to defer to dictionary or common law definitions when faced with unintended ambiguity. The second possibility – that Congress knowingly left the term undefined, expecting the agency to use its discretion in defining it – even more strongly supports Chevron deference.
The Court also failed to engage DOL’s reasoning for including applicants within the definition of “employees.” In Samodurov v. General Physics Corporation, the DOL Office of Administrative Appeals stated, “It is well established that the ERA covers applicants for employment.” The DOL reasoned that “[a] broad interpretation of ‘employee’ is necessary to give full effect to the purpose of the employee protection provision, which is to encourage reporting of safety deficiencies in the nuclear industry.” In Vander Boegh, the Sixth Circuit did not address either the DOL’s long-standing and settled interpretation of employee under the ERA, or DOL’s reasoning based on the congressional intent underlying the statue.
Finally, in addition to the Third Circuit opinion cited but not followed by the Court, other circuits have assumed that applicants are protected under the anti-retaliation provision of the ERA. The Fifth Circuit applied a three-part test to decide whether job applicants were protected under the ERA in Williams v. Administrative Review Board. In Hasan v. Department of Labor, the Tenth Circuit upheld the dismissal of an applicant’s claim under the whistleblower provision of the ERA, but not because the plaintiff was an applicant. Like the Fifth Circuit in Williams, the Tenth Circuit laid out the elements the applicant needed to show to sustain a claim under the act. At least three other circuits have thus deferred to DOL’s determination that applicants are within the definition of employee under the ERA.
For these reasons, the Sixth Circuit’s limited reading of “employee” under the ERA (and, by extension, other federal whistleblowing statutes) to exclude applicants is unlikely to be followed by other circuits.