USDOL/OALJ Reporter: ARB Decision Caselist -- May 2010

---

Summary :

[STAA Digest IV A 2 a]
CAUSATION; 2007 AMENDMENTS TO THE STAA DO NOT APPLY TO COMPLAINT FILED PRIOR TO THE EFFECTIVE DATE OF THE AMENDMENTS

In Fleeman v. Nebraska Pork Partners , ARB Nos. 09-059, -096, ALJ No. 2008-STA-15 (ARB May 28, 2010), the ALJ erred in applying the causation standard of the whistleblower provision of the STAA as amended in 2007 rather than the standard in effect at the time that the complaint was filed. Although such a legal error would normally result in a remand to apply the correct legal standard, the ARB found that application of the correct legal standard led to the same result in favor of the Complainant. Accordingly, the ARB found that substantial evidence supported the ALJ's finding that the Complainant had been fired because of his protected activity in violation of the STAA's whistleblower protection provisions.

[STAA Digest IX A 9]
FRONT PAY UNTIL OWNER-OPERATOR, WHO WAS FORCED TO SELL HIS TRUCK, CAN OBTAIN ANOTHER TRUCK AND BE REINSTATED

In Fleeman v. Nebraska Pork Partners , ARB Nos. 09-059, -096, ALJ No. 2008-STA-15 (ARB May 28, 2010), the Complainant, an owner-operator contract driver, testified that he wanted reinstatement, but had been forced to sell his truck after the Respondent terminated his contract, and could not perform his duties unless and until he secured a new truck. The ALJ awarded front pay until such time as the Complainant could obtain another truck and thus accept reinstatement.

On appeal, the Complainant requested a remand for the ALJ to calculate the amount of the front pay (the ARB presuming on the basis of his inability to afford to purchase a truck). The ARB declined "at this time" to order a remand for that purpose because too little time had passed to conclude that the relief ordered by the ALJ was an impossibility. The ARB stated that it anticipated that the Respondent, in the exercise of its own self-interest, will "make a good-faith effort to assist [the Complainant] in obtaining a truck and thereby re-establishing his qualifications for contracting with [the Respondent] as an owner-operator."

[STAA Digest IIE1]
MOTION FOR NEW TRIAL; ALJ'S PURPORTED AGGRESSIVE AND INTIMIDATING QUESTIONING OF WITNESSES

In Fleeman v. Nebraska Pork Partners , ARB Nos. 09-059, -096, ALJ No. 2008-STA-15 (ARB May 28, 2010), the Respondent filed a motion for a new trial with the ARB on the ground that the ALJ improperly examined two of the Respondent's witnesses in an aggressive and intimidating manner. Applying FRCP 59(a)(2) and FRCP 60(b), as made applicable by 29 C.F.R. § 18.1(a), the ARB denied the motion. The ARB reviewed the transcript and found that the ALJ's questioning had not been hostile or intimidating. The ARB noted that the ALJ had attempted throughout the hearing to elicit further information and clarify all witnesses' answers, but that his questions appeared to be neutral and even-handed.

---

---

Summary :

Denial of reconsideration.

---

---

Summary :

TIMELINESS OF COMPLAINT; A RESPONDENT IS NOT OBLIGATED TO INFORM THE COMPLAINANT OF THE EXISTENCE OF, OR DEADLINES FOR, POTENTIAL CAUSES OF ACTION

In Daryanani v. Royal & Sun Alliance , ARB No. 08-106, ALJ No. 2007-SOX-79 (ARB May 27, 2010), the Complainant did not file his SOX complaint within 90 days of the date the Respondent notified him of his termination. The Complainant argued that the Respondent should be estopped from raising a timeliness defense because it did not list SOX in the release of the severance agreement and because it failed to counter-sign the severance agreement until after the 90-day statute of limitations had expired. The ARB, however, held that the Respondent was not obligated to inform the Complainant of potential causes of action, the potential deadlines under those statutes, or to take specified actions within the deadlines of known or unknown statutes. The ARB also found that the ALJ had not abused his discretion in denying discovery on the ground that the issue of timeliness could be resolved without it. The ARB acknowledged that the issue of equitable modification of a deadline might require discovery to resolve in a particular case, but found that this was not one of those cases.

---

---

Summary :

PROTECTED ACTIVITY; COMPLAINANT'S SINGLE REFUSAL TO ACT IN A MANNER HE BELIEVED TO BE FRAUDULENT MUST DIRECTLY IMPLICATE CATEGORIES OF FRAUD LISTED IN SOX; REQUIREMENT THAT COMPLAINANT'S REASONABLE BELIEF THAT TO DO OTHERWISE WOULD CONSTITUTE A MATERIAL MISSTATEMENT OR OMISSION CONCERNING RESPONDENT'S FINANCIAL CONDITION

In Fredrickson v. The Home Depot U.S.A., Inc. , ARB No. 07-100, ALJ No. 2007-SOX-13 (ARB May 27, 2010) , it was undisputed that the Complainant refused to mark down store-used items as "damaged goods" because he believed it was "illegal" and fraudulent. The ARB held, however, that "refusing to mark down a single package of hooks at one Home Depot store as 'damaged goods' does not constitute SOX-protected activity because it did not directly implicate the categories of fraud listed in the statute or securities violations, but at most constitutes an expenditure with which Fredrickson disagreed. Moreover, one instance of refusing to mark down a single package of hooks as 'damaged goods' is not sufficient to support a finding that Fredrickson had a reasonable belief that to do otherwise would constitute a material misstatement of fact or omission concerning Home Depot's financial condition, on which an investor would reasonably rely." USDOL/OALJ Reporter at 7 (footnotes omitted).

PROTECTED ACTIVITY; LACK OF REPORT TO SUPERVISORY OFFICIAL OR OFFICIAL WITH AUTHORITY TO INVESTIGATE, DISCOVER OR TERMINATE MISCONDUCT

In Fredrickson v. The Home Depot U.S.A., Inc. , ARB No. 07-100, ALJ No. 2007-SOX-13 (ARB May 27, 2010) , it was undisputed that the Complainant refused to mark down store-used items as "damaged goods" because he believed it was "illegal" and fraudulent. The ARB held, however, that the undisputed facts showed that the only employees of the Respondent aware of the Complainant's refusal did not have supervisory authority over the Complainant, or authority to investigate, discover or terminate misconduct. Merely stating in an affidavit that the Respondent knew or had reason to know that he engaged in protected activity was insufficient to create a genuine issue of material fact in response to a motion for summary decision. Moreover, the affidavit contradicted the Complainant's admission in a deposition that he did not discuss the refusal with anyone with supervisory authority over him.

CAUSATION; FAILURE TO RAISE GENUINE ISSUE OF MATERIAL FACT AS TO KNOWLEDGE OF OFFICIALS WHO TERMINATED THE COMPLAINANT OF ALLEGED PROTECTED ACTIVITY

In Fredrickson v. The Home Depot U.S.A., Inc. , ARB No. 07-100, ALJ No. 2007-SOX-13 (ARB May 27, 2010) , the undisputed facts were that the Complainant refused to mark down store-used items as "damaged goods" because he believed it was "illegal" and fraudulent, but that no official involved in or responsible for the Complainant's termination were aware of any alleged protected activity. The Complainant's statement in an affidavit in response to the Respondent's motion for summary decision that his protected activity was a contributing factor in his termination was insufficient to establish a genuine issue of material fact whether the relevant officials of the Respondent were aware of his protected activity.

---

---

Summary :

Approval of withdrawal of objections to OSHA findings.

---

---

Summary :

Approval of withdrawal of objections to OSHA findings.

---

---

Summary :

Approval of settlement agreement.

---

---

Summary :

PRETEXT; FINDING THAT RESPONDENT ARTICULATED NON-DISCRIMATORY REASONS FOR ADVERSE ACTION MERELY SHIFTS BURDEN TO COMPLAINANT TO ESTABLISH PRETEXT, AND DOES NOT MEAN THAT ARTICULATED REASONS WERE FOUND TO BE CREDIBLE

In Clemmons v. Ameristar Airways, Inc. , ARB No. 08-067, ALJ No. 2004-AIR-11 (ARB May 26, 2010), the ALJ had found that the Respondent had articulated four facially non-discriminatory reasons for firing the Complainant, and therefore the burden shifted to the Complainant to establish pretext. On appeal, the Respondent argued that substantial evidence did not support the ALJ's finding that the proffered reasons were pretext because the ALJ initially found then to be legitimate. The ARB rejected this argument, noting that the ALJ's finding that the reasons were facially non-discriminatory did not mean that the ALJ also found the reasons to be credible.

PRETEXT; SHIFTING AND AFTER-THE-FACT EXPLANATIONS

In Clemmons v. Ameristar Airways, Inc. , ARB No. 08-067, ALJ No. 2004-AIR-11 (ARB May 26, 2010), in affirming the ALJ's finding that the Respondent had offered new and differing reasons for firing the Complainant after the fact, the ARB noted that it

...has held that shifting explanations for an employer's adverse action often indicate that its asserted legitimate reasons are pretext. Also, the credibility of an employer's after-the-fact reasons for firing an employee is diminished if these reasons were not given at the time of the initial discharge decision. Finally, contradictions in the circumstances surrounding an employer's termination of employment can also indicate that the employer's real motive was unlawful retaliation.

USDOL/OALJ Reporter at 9-10 (footnotes omitted).

DEFINITION OF CLEAR AND CONVINCING EVIDENCE

In Clemmons v. Ameristar Airways, Inc. , ARB No. 08-067, ALJ No. 2004-AIR-11 (ARB May 26, 2010), the ARB cited Black's Law Dictionary 577 (7th ed 1999) for the definition of "clear and convincing evidence":

Clear and convincing evidence or proof denotes a conclusive demonstration; such evidence indicates that the thing to be proved is highly probable or reasonably certain. Thus, in an AIR 21 case, clear and convincing evidence that an employer would have fired the employee in the absence of the protected activity overcomes the fact that an employee's protected activity played a role in the employer's adverse action and relieves the employer of liability.

USDOL/OALJ Reporter at 9-11 (footnotes omitted).

REINSTATEMENT; ALJ'S FAILURE TO AUTOMATICALLY ORDER REINSTATEMENT NOT REVIEWED ON APPEAL WHERE NOT RAISED BY PARTIES

In Clemmons v. Ameristar Airways, Inc. , ARB No. 08-067, ALJ No. 2004-AIR-11 (ARB May 26, 2010), the ARB stated that the ALJ erred in not automatically awarding reinstatement, even though the Complainant already had another job. However, because the issue was not raised on appeal, the ARB decided not to address it.

BACK PAY AWARD DEDUCTIONS FOR WORKERS COMPENSATION; DEDUCTIONS WILL BE MADE FOR COMPENSATION PAID FOR WAGES, BUT NOT FOR COMPENSATION PAID FOR IMPAIRMENT

In Clemmons v. Ameristar Airways, Inc. , ARB No. 08-067, ALJ No. 2004-AIR-11 (ARB May 26, 2010), the ARB deducted workers' compensation payments covering lost wages from the back pay award to avoid a windfall, but did not deduct such payments where they were based on a permanent impairment. The ARB wrote:

Generally, workers' compensation benefits that replace lost wages during a period in which back pay is owed may be deducted from a back-pay award; however, workers' compensation in reparation for permanent physical injury is not compensation for loss of wages and is thus not deductible.

(footnote omitted). The ARB also affirmed the ALJ's finding that the Respondent failed to prove that the Complainant had engaged in fraud (and therefore should have the back pay awarded discounted) when he sought unemployment benefits while receiving workers' compensation. The Complainant had paid back the overpayment once informed that he could not receive both benefits.

ATTORNEY FEES; ARB DECLINES TO REMAND FOR CONSIDERATION OF ATTORNEY FEES AND EXPENSES

In Clemmons v. Ameristar Airways, Inc. , ARB No. 08-067, ALJ No. 2004-AIR-11 (ARB May 26, 2010), the ARB affirmed the ALJ's decision finding in favor of the Complainant on the merits of his AIR21 whistleblower complaint, but declined to remand the case to the ALJ for consideration of attorney fees and expenses. The ARB explained that the Complainant "must file a petition for such fees and expenses with the ALJ."

---

---

Summary :

[Nuclear and Environmental Digest XI D 2]
ESTABLISHMENT OF MOTIVATING FACTOR IN FWPCA CASE LEADS DIRECTLY TO MIXED OR DUAL MOTIVE ANALYSIS

[Nuclear and Environmental Digest XI D 1 a]
MIXED OR DUAL MOTIVE ANALYSIS; INABILITY OF SUPERVISOR TO MANAGE HIGHLY MOTIVATED AND WELL-EDUCATED EMPLOYEES WHOSE BEHAVIOR WAS TIED TO PROTECTED ACTIVTY

In Abdur-Rahman v. Dekalb County , ARB Nos. 08-003, 10-074, ALJ Nos. 2006-WPC-2 and 3 (ARB May 18, 2010), the Complainants established that their protected activity was a motivating factor in their termination from employment. The Complainants, who were still in their probationary period, had been discharged because their supervisor found them to be unmanageable. The ARB, reviewing the record, found that the supervisor's inability to manage the Complainants was related to their engaging in protected activity. Although one of the Complainants had become argumentative and had called the supervisor incompetent, the argumentative behavior was protected activity, and the Respondent admitted supervisory incompetence.

Because protected activity was a motivating factor, the ARB then employed the mixed or dual motive analysis, in which the burden shifted to the Respondent to demonstrate by a preponderance of the evidence that it would have discharged the Complainants even if they had not engaged in protected activity. The ARB noted that the ALJ had erred at this point in the analysis by first requiring the Complainants to establish pretext before turning to the Respondent's burden. It was not, the ARB stated, a burden the Complainants had to bear.

The ARB came to a very different legal conclusion on mixed motive than did the ALJ:

    The ALJ did, however, at the end of his decision, ultimately address the issue of whether [the Respondent] demonstrated by a preponderance of the evidence that it would have discharged [Complainants] even if they had not engaged in protected activity. The ALJ found that the evidence demonstrated that [the supervisor]'s admitted inability to manage [Complainants] was the true motivation for their discharge. The ALJ determined that the record establishes management's "failure to follow [its] own guidance and to properly lead these high-motivated and well-educated employees." The ALJ also found that [the supervisor], as well as other supervisors, were "thin skinned," taking offense at the slightest possible perceived affronts and labeling them "insubordination." He determined that the Complainants, as well as another probationary employee, were terminated for their supervisors'' "inability to handle common challenges posed by enthusiastic and more highly-educated inspectors." Accordingly, the ALJ concluded that protected activity was not the motivating factor in the Complainants'' discharge. Specifically, he concluded that [the Respondent] established that it would have discharged the Complainants even in the absence of their protected activity "because managing them was above their supervisor's means and they did not fit in the peculiar culture of the Water and Sewer Department."

    Because it is consistent with the preponderance of the record as set forth above, we agree with the ALJ's finding that [the supervisor] was unable to manage [Complainants] and that his supervisory incompetence motivated the County to discharge them. We, however, arrive at a different legal conclusion than the ALJ. Where, as here, the evidence plainly demonstrates that [the supervisor]'s very inability to manage [Complainants] was inextricably tied to their FWPCA-protected activity, we conclude that [the Respondent] did not meet its burden to show by a preponderance of the evidence that it would have discharged [Complainants] even in the absence of their protected activity. [the Respondent] bears the risk that the influence of legal and illegal motives cannot be separated. Therefore, we conclude that [the Respondent] violated the FWPCA's employee protection provisions when it discharged [Complainants]. On this record, we further conclude that [the Respondent] is not relieved from liability under the theory of dual motive. Accordingly, we reverse the ALJ's conclusion that [the Respondent] is relieved of liability because it demonstrated that it would have discharged [Complainants] even if they had not engaged in protected activity.

USDOL/OALJ Reporter at 11-12 (footnotes omitted).

One member of the Board concurred, but based on a different analysis. The concurring member stated that he did "not excuse all of the documented incivility based on [the Complainants] whistleblower status or lay blame on the County's inability to manage it...." Rather this member simply held that the Respondent failed to carry its burden of proof. The concurring opinion also suggests that it was a proper sequential step for the ALJ to have considered pretext before proceeding to the mixed motive test.

---

---

Summary :

Approval of settlement agreement.

---

---

Summary :

[STAA Digest VI B 4]
MERITORIOUS FILING OF BREACH OF SETTLEMENT AGREEMENT ACTION ORDINARILY WILL NOT GIVE RISE TO VIABLE ACTION FOR RETALIATION UNDER THE STAA

In Harrell v. Sysco Foods of Baltimore , ARB Nos. 08-022, -065, ALJ No. 2003-STA-50 (ARB May 14, 2010), the Complainant filed several claims against the Respondent, one of which was a STAA complaint. The STAA complaint was filed by the Complainant and four other complainants. The Complainant entered into a settlement agreement with Respondent, filed in federal district court. The settlement included provisions for non-dispargement and requiring the Complainant not to voluntarily aid or assist any third party claims against the Respondent. It required the Complainant to take all reasonable and appropriate steps to effectual dismissal of pending claims against the Respondent. The settlement provided that a substantial and material breach of the agreement would be grounds for a cause of action seeking damages and recovery of certain payments under the agreement. After the agreement the Respondent's attorneys disposed of all of the claims except the STAA claim. The Complainant thereafter wrote a letter asserting that he had been harassed by certain of the Respondent's supervisors and offering to assist a third party claim against the Respondent. Then, OSHA issued a letter of merit regarding the STAA claim. It was only then that the Complainant wrote to OSHA stating that he wished that the complaint be withdrawn because of the settlement agreement. The Respondent then filed suit in county court for breach of the settlement agreement based on the failure to dismiss the STAA claim, disparagement of the Respondent, and assisting in a third-party claim. In response, the Complainant filed a complaint with OSHA asserting that the county court action was in retaliation for the filing of the first STAA complaint. In the meantime, the parties in the first STAA claim were engaged in settlement negotiations, during which the Respondent agreed to waive its breach of contract claim in county court relating to failure to dismiss the first STAA claim and that it would so advise the county court judge. After receiving confirmation that the county court had been notified of the waiver, the ALJ in the first STAA claim approved a settlement of that STAA complaint. Subsequently, the county court found a breach of the settlement agreement and awarded nominal damages. On appeal, however, the state court of appeals awarded the Respondent $187,305.50 plus interest for the breach of the settlement agreement. Earlier, OSHA had dismissed the second STAA complaint, and a hearing was conducted before an ALJ. The ALJ found that the lawsuit was retaliatory, and awarded damages for mental and emotional distress, litigation expenses, and $187,305.50 for the state judgment. On appeal the ARB reversed.

The ARB found that the Respondent's state action was in enforcement of the settlement agreement that the Complainant had willfully entered into, and which had settled a number of claims, and noted that the settlement of the first STAA complaint had been approved only after the ALJ received confirmation that the Respondent had notified the county judge of the Respondent's waiver of the count alleging failure to dismiss the STAA complaint. The ARB found that the Respondent was entitled to the benefit of its global settlement agreement and had paid substantial sums for the benefit of that bargain. The ARB noted that the state appeals' court's judgment might seem harsh, but that it must defer to it because the state court had jurisdiction to determine whether a party violated a settlement agreement. Thus, the Respondent "did not retaliate against [the Complainant] when it filed an enforceable claim for breach of a settlement agreement." The ARB also held that even if the second STAA claim presented a valid cause of action, it must fail because the state court ruling affirmed breach based on aiding a third party claim and disparaging the company. Thus, even if retaliation was initially a motiving factor, the Respondent "established by a preponderance of the evidence that it would have brought the meritorious litigation in any case." The ARB noted that it encourages negotiated settlements and that "[a] meritorous enforcement action by an employer ordinarily does not give rise to a viable retaliation complaint."

---

---

Summary :

[STAA Digest X B]
Settlement reached after ARB issued its final decision; refusal of ARB to approve agreement contingent on vacating of the ARB's final decision

In Testa v. Consolidated Edison Co. of New York, Inc. , ARB No. 08-029, ALJ No. 2007-STA-27 (ARB May 12, 2010), after the ARB issued its decision on the merits, but before the 60-day period for seeking judicial review had expired, the parties informed the ARB that they had reached a settlement and requested the ARB to approve the settlement and vacate the ARB's final decision. The ARB noted that the settlement agreement was contingent upon the Board vacating the final decision. The ARB ruled that was unwilling to vacate its final decision a matter of public policy, and therefore it could not approve the settlement agreement contingent upon that event.

---