USDOL/OALJ Reporter: ARB Decision Caselist - May 2018

UNTIMELY PETITION FOR ARB REVIEW; WHETHER A PARTY IS REQUIRED TO FILE A TIMELY PETITION FOR ARB REVIEW TO OBTAIN COURT OF APPEALS REVIEW IS NOT RELEVANT AND IS CONTRARY TO DOL REGULATORY AUTHORITY; GARDEN VARIETY EXCUSABLE NEGLECT OF ATTORNEY IS NOT SUFFICIENT TO ESTABLISH EQUITABLE TOLLING; REASONABLE DILIGENCE MAY REQUIRE FILING OF MOTION FOR ENLARGEMENT OF TIME TO FILE PETITION

In Sparre v. Norfolk Southern Railway Co. , ARB No. 18-022, ALJ No. 2016-FRS-38 (ARB May 31, 2018), the Complainant’s petition for review of the ALJ’s order granting the Respondent’s motion for summary decision was untimely. The Respondent moved for dismissal of the petition.

Contention of right to direct appeal to the courts

The Complainant first argued in response to the motion to dismiss that a party is not required to file a timely petition for review with the ARB to obtain review in the court of appeals. The ARB found that this argument was irrelevant as to whether to toll the limitations period for ARB review. It was also contrary to the regulation at 29 C.F.R. § 1982.110(a), which provides that “[a]ny party desiring to seek review, including judicial review, of a decision of the ALJ, ... must file a written petition for review with the ARB .... ” Slip op. at 3, quoting regulation (emphasis as added by the ARB). The ARB noted that its delegation of review authority from the Secretary does not include authority to pass on the validity of regulations published by DOL in the Code of Federal Regulations. And, the ARB noted that the Complainant had not cited any appellate court authority in support of the argument that a party may appeal the ALJ’s decision directly to the court of appeals.

Standard is not excusable neglect, but extraordinary circumstances

The Complainant then presented a “smorgasbord” of arguments for equitable tolling, none of which were accepted by the ARB. The ARB noted that the Complainant had been represented by counsel, that an attorney practicing before the ARB is expected to familiarize himself with the applicable regulations, and that clients are ultimately accountable for the acts and omissions of their attorneys. The ARB noted that even if the attorney’s excuses for failing to file timely could meet an “excusable neglect” standard, the applicable standard was “extraordinary circumstances.” The ARB cited caselaw to the effect that a garden variety claim of excusable neglect is insufficient to establish grounds for equitable tolling. The ARB also found a lack of diligence for failure to file a short motion to request an enlargement of time to file the petition.

In Smith v. Kareem Transportation , ARB No. 18-021, ALJ No. 2017-STA-60 (ARB May 30, 2018), the ARB denied the Complainant’s request for reconsideration where the ARB had dismissed the appeal because the Complainant failed to respond to an Order to Show Cause to demonstrate why the Board should accept his untimely filed petition for review, and the request for reconsideration only addressed the merits of the complaint and not the failure to respond to the Order to Show Cause.

CONFORMANCE REQUEST DENIED WHERE PROPOSED WAGE RATE DID NOT BEAR A REASONABLE RELATIONSHIP TO WAGE RATE DETERMINATIONS UNDER ALL AGENCY MEMORANDUM (AAM) 213

In Velocity Steel, Inc. , ARB No. 16-060 (ARB May 29, 2018), a subcontractor on four Idaho highway construction projects subject to DBA labor standards petitioned for review of a final determination of the Wage and Hour Division Administrator issued under the Davis-Bacon Act and the Davis-Bacon Related Acts. The ARB summarized the case as follows:

     The Administrator’s final determination affirmed the Wage and Hour Division’s (WHD) decisions denying conformance requests from the contracting agency, the ITD on behalf of Velocity Steel, to add an Ironworker job classification at a wage rate of $16.00 per hour, plus $5.00 in fringe benefits, to three general wage determinations that were incorporated in the four highway construction contracts. After Velocity Steel requested review and reconsideration of the WHD conformance decisions, the Administrator held that the conformance requests do not satisfy the criteria at 29 C.F.R. § 5.5(a)(1)(ii)(A)(3) because the proposed wage rate and fringe benefits do not bear a reasonable relationship to the wage rates contained in the relevant wage determinations in accordance with the guidelines in the Administrator’s All Agency Memorandum (AAM) 213. Instead, the Administrator approved an Ironworker job classification at a wage rate of $23.92 per hour, plus $9.75 in fringe benefits, as it bears a reasonable relationship to the wage rates contained in the relevant wage determinations in accordance with the criteria at 29 C.F.R. § 5.5(a)(1)(ii)(A)(3) and the guidelines in AAM 213. Because the Administrator acted in accordance with the applicable regulation at 29 C.F.R. § 5.5(a)(1)(ii)(A)(3) and settled agency policy and practice, the Administrator’s denial of the conformance requests and, alternatively, approving an Ironworker job classification at a wage rate of $23.92 per hour, plus $9.75 in fringe benefits, is reasonable and, therefore, is affirmed.

USDOL/OALJ Reporter at 2.

DISMISSAL FOR CAUSE; FAILURE TO RESPONSE TO ALJ’S ORDERS; DIFFICULTY WITH FAXING AND NEED TO FILE DOCUMENTS IN COURT PROCEEDING FOUND NOT TO EXCUSE FAILURE

In Lee v. Norfolk Southern Railway Co. , ARB No. 17-015, ALJ No. 2014-FRS-24 (ARB May 25, 2018), the ARB summarily affirmed the ALJ’s order dismissing the Complainant’s FRSA complaint where the Complainant failed to respond to an order to show cause why the claim should not be dismissed for failure to respond to an earlier order directing the Complainant to provide a status report on whether he would be proceeding with the FRSA complaint without a representative after the ALJ granted the Complainant’s counsel motion to withdraw from representation. The ARB found that the Complainant’s purported problems with faxing responses and need to make filings in a Court of Appeals matter did not excuse the failure to respond to the ALJ’s order to show cause. Moreover, the ARB found that the ALJ did not abuse her discretion in not mentioning in the order to show cause that the Complainant had filed a 60 page fax that was a status report on civil litigation in the Federal courts. That fax had not addressed the question of whether the Complainant intended to proceed with the FRSA claim before the ALJ without a representative, and was dated prior to the ALJ issued the order to show cause.

PROTECTED ACTIVITY; GARRIE “MERE INQUIRY” RULING IS DISTINGUISHABLE WHERE COMPLAINANT URGED GOVERNMENT AUTHORITIES TO TAKE ACTION

In Loftus v. Horizon Lines, Inc. , ARB No. 16-082, ALJ No. 2014-SPA-4 (ARB May 24, 2018), the Respondent contended that the Complainant did not engage in protected activity under the Seaman’s Protection Act when he contacted the American Bureau of Shipping (ABS). The Respondent argued that the Complainant had not reported a safety violation or file a complaint, but only inquired about previously filed complaints. The Respondent cited in this regard Garrie v. James L. Gray, Inc. , 912 F.2d 808, 812 (5th Cir. 1990), in which the court ruled that the employee protection provisions of the Seaman’s Protection Act are narrowly tailored to protect only the seaman who has reported or is about to report a violation. The ARB, however, agreed with the ALJ that Garrie was distinguishable on the facts. Here, the Complainant did more than make inquiries; he alerted an ABS inspector to safety violations and conveyed information in the hope that it would facilitate compliance; he did not ask the ABS inspector questions, but instead expressed disbelief that ABS allowed the problems to persist, citing a detailed list of items needing immediate action. In one instance, the Respondent contended that the Complainant had only sought “clarification” from ABS on a Master’s authority when weighing a duty for timely conducting drug testing against a Master’s duty to ensure the safety of a vessel. Again, the ARB agreed with the ALJ that the Complainant had not just made inquiries; he had urged the Coast Guard to take action. The ARB found that the Complainant’s actions easily fit into one or more categories of protected activity under the SPA, and that the ALJ’s finding of protected activity was supported by substantial evidence.

AFFIRMATIVE DEFENSE; ARB AFFIRMS ALJ’S DISCOUNTING OF RESPONDENT’S EXPLANATION FOR ADVERSE EMPLOMENT ACTION BASED ON COMPLAINANT’S EXPERTS

In Loftus v. Horizon Lines, Inc. , ARB No. 16-082, ALJ No. 2014-SPA-4 (ARB May 24, 2018), the Complainant was a Master or Captain demoted to Chief Mate after an incident at-sea in which his First Mate sustained serious injuries. The ARB found that the ALJ acted within his discretion when, at the Respondent’s “clear and convincing evidence” affirmative defense stage of the analysis of a Seaman’s Protection Act retaliation complaint, he discounted the Respondent’s stated reasons for the demotion based upon four expert opinions adduced by the Complainant. The Respondent had presented evidence that it demoted the Complainant based solely on poor judgment related to the at-sea incident. The ARB, however, found that substantial evidence supported the ALJ’s findings that (1) the demotion letter’s reference to weather “as bad as anyone had experienced in recent memory” was contrary to uncontroverted evidence that the weather at the time of the accident was “moderate”; (2) the Respondent’s investigation was superficial; (3) expert testimony established that the Complainant used a Master’s standard of care and had tried to avoid an International Convention for the Prevention of Pollution From Ships (“MARPOL”) violation, and Complainant’s standard of care was never investigated and MARPOL not considered; (4) investigative reports and expert opinions showed that the Respondent’s contention that the Complainant’s decision-making showed an inadequate safety climate on the vessel was unsupported by the record and was a fabrication; and (5) the disciplinary letter referred to other factors as justifying demotion, even though the Respondent had argued that it had demoted the Complainant solely based on an asserted lapse of judgment.

DAMAGES; DETERMINING THE END DATE FOR BACK WAGES; CONSTRUCTIVE DISCHARGE; EFFECT OF CUMULATIVE FACTORS

In Loftus v. Horizon Lines, Inc. , ARB No. 16-082, ALJ No. 2014-SPA-4 (ARB May 24, 2018), the Complainant was a Master or Captain demoted to Chief Mate after an incident at-sea in which his First Mate sustained serious injuries. The ARB affirmed the ALJ’s findings that SPA protected activity was a contributing factor in the demotion decision, and that the Respondent failed to establish its affirmative defense. In regard to damages, the Respondent argued on appeal that the ALJ erroneously found that the Complainant was constructively discharged and entitled to full back pay from his demotion to the date when the Respondent ceased its East Coast operations. The Respondent contended that the Complainant voluntarily resigned rather than sail as a Chief Mate and was entitled only to the pay difference between a master’s and chief mate’s salaries. The Respondent also contested the ALJ’s award of $100,000 in severance pay awarded to employees at the time of cessation of operations. The Respondent argued that the Complainant was not an employee at the time because he had resigned earlier. The ARB wrote:

Slip op. at 8 (footnotes omitted). The ARB found that the ALJ’s constructive discharge finding was supported by substantial evidence and consistent with applicable law. Factors considered were the demotion itself; the fact that if the Complainant had accepted two sails offered at the demoted level (one being on the West Coast) there would have been a significant cut in pay; the new positions were not permanent, whereas the Complainant had been a permanent employee; the uncontroverted evidence was that demotion from master to chief mate was unprecedented for the Respondent; expert opinions and the Complainant’s credible testimony showed that he would not have been able to effectively perform as a chief mate position because it was more physically demanding and the Complainant would have received little to no respect from his crew; there was evidence of hostility toward the Complainant and his protected activity; the Complainant had not been allowed on the vessel to pick up his six years’ worth of personal belonging, but had to receive them at the dock from a pick-up truck. These cumulative findings showed that the Respondent created working conditions sufficiently intolerable to substantiate a finding of constructive discharge. Because the ARB affirmed the ALJ’s constructive discharge finding, it also affirmed the ALJ’s award of back pay up until the Respondent ceased East Coast operations, and the award of the severance pay given to employees at the time of the cessation.

PUNITIVE DAMAGES AFFIRMED WHERE RESPONDENT FOUND TO BE PERSISTENTLY INDIFFERENT TO COMPLAINANT’S SAFETY CONCERNS AND ENGAGED IN RECURRING RETALIATION, AND WHERE ALJ PROPERLY ANALYZED THREE FACTOR STANDARD FOR PUNISHMENT AND DETERRENCE

In Loftus v. Horizon Lines, Inc. , ARB No. 16-082, ALJ No. 2014-SPA-4 (ARB May 24, 2018), the Complainant was a Master or Captain demoted to Chief Mate after an incident at-sea in which his First Mate sustained serious injuries. The ARB affirmed the ALJ’s findings that SPA protected activity was a contributing factor in the demotion decision, and that the Respondent failed to establish its affirmative defense. On appeal, the Respondent challenged the ALJ’s award of $225,000 in punitive damages (not the amount, but rather whether it should have been awarded at all). The ARB, however, found that substantial evidence supported the ALJ’s findings of intentional misconduct warranting punitive damages. The ARB quoted the ALJ: who found that the Respondent’s “conduct was reprehensible” based in part on the Respondent’s “persistent indifference” to the Complainant’s safety concerns and recurring retaliation against him despite “his reputation for being an exemplar of safety.” Slip op. at 10, quoting ALJ decision at 43.

The ARB also found that the ALJ properly applied ARB precedent when evaluating the three guideposts for determining the punishment and deterrence aspects of a punitive damages award:

(1) the degree of reprehensibility of the respondent’s misconduct;
(2) the relationship between the harm to the complainant and the size of the punitive award, and
(3) punitive damage awards in comparable cases.

The ARB noted that “the ALJ reasoned that a large punitive damage award was necessary to deter and punish Horizon given its longstanding ‘inaction in addressing Loftus’s safety concerns, ’ the chilling effect Horizon’s retaliatory actions likely had on other marine employees, and the harm it visited upon Loftus personally.” Slip op. at 46.

The ARB dismissed the Complainant's ERA administrative complaint because the Complainant notified the ARB that he intends to file a complaint with the U.S. District Court in Washington State.

[STAA Digest V B 2 b]
PROTECTED ACTIVITY; ARB AFFIRMS ALJ’S FINDING OF NO PROTECTED ACTIVITY WHERE COMPLAINANT WAS NOT CREDIBLE; WHERE A DRIVER VEHICLE INSPECTION RECORD HAD SUSPECT ORIGIN AND CONFLICTED WITH COMPLAINANT’S OWN TESTIMONY; AND WHERE A POST-ACCIDENT EMAIL DID NOT REFLECT A REASONABLE BELIEF BY COMPLAINANT THAT HE WAS REPORTING A SAFETY VIOLATION

In Garrett v. Bigfoot Energy Services, LLC , ARB No. 16-057, ALJ No. 2015-STA-47 (ARB May 14, 2018), Complainant was involved in an accident in which a car was trapped under his assigned truck. In an email sent to Respondent by Complainant after a safety meeting in which it was announced that the other driver had filed a lawsuit against Respondent, Complainant indicated that failure to fix signal lights on the truck was a cause or factor for the accident. Complainant’s earlier accounts to police and to Respondent’s owner had not mentioned a problem with the truck’s turn signal prior to the accident. Respondent fired Complainant for his inconsistent statements. Respondent’s owner perceived Complainant’s about-face as setting up the company for liability so that Complainant could protect himself. Complainant then filed a STAA complaint alleging that Respondent retaliated against him for complaining about Respondent’s failure to adhere to vehicle safety and maintenance standards. After a hearing, the ALJ concluded that Respondent did not violate the STAA. The ARB affirmed. The case largely turned on Complainant’s lack of credibility.

The ARB found that substantial evidence supported the ALJ’s finding that Complainant was not credible in several respects and that other witnesses for Respondent were credible. The ALJ found that Complainant’s story was equivocal or unclear as to the circumstances of the accident, and that Complainant had lied on his employment application and to an insurance adjuster. The ARB noted that it typically gives high deference to an ALJ’s credibility determinations, and that on appeal Complainant had not pointed to any facts or arguments to overturn the ALJ’s holdings.

Complainant claimed that he had told Respondent before the accident in oral complaints that the truck’s turn signals had not been fixed, but the ALJ found that this claim was not supported by the record or Complainant’s incredible testimony. Complainant also allegedly filled out an August 14th Driver Vehicle Inspection Record (DVIR) listing turn signals as defective. The ARB noted that such a DVIR would likely constitute protected activity, but then noted that the ALJ had found it not significant or credible because its origin was unknown and it conflicted with Complainant’s own testimony. Respondent had questioned how Complainant managed to produce the DVIR from that date because the DVIR booklet is kept in the truck and originals are turned into the company. In regard to the post-safety-meeting email, the ARB stated that on its face, it would find that it was protected under the STAA’s complaint clause at 49 U.S.C.A. § 31105(a)(1)(A), but then noted the ALJ’s finding that Complainant failed to show that he reasonably believed that the complaints in the email constituted safety violations when viewed in context and Complainant’s complete lack of credibility. The ALJ credited Respondent’s position that Complainant made up the turn signal complaints after the accident to shift liability. The ARB found no reversible error in the ALJ’s finding that Complainant had not credibly established that he engaged in protected activity.

The ARB also affirmed the ALJ’s alternative finding that Complainant failed to prove that protected activities were a factor in the decision to terminate Complainant’s employment. Although there was temporal proximity, the ALJ explained how intervening events vitiated the strength of the inference.