DOL Review of Whistleblower Settlements

Revised August 16, 2011

This memorandum describes the procedural requirements for dismissal of a whistleblower complaint under 29 C.F.R. Parts 24, 1978, 1979, 1980 and 1981 where a settlement agreement underlies the request for dismissal. In particular, this memorandum describes (1) when a whistleblower settlement is required to be submitted to the ALJ or ARB for review, and (2) whether the ALJ's order is recommended or final.

Caselaw describing substantive requirements for review of settlements may be found in the following case Digests:

I. Settlement Reached Prior to Investigatory Finding and Appeal to ALJ

In general, settlements reached during the investigative stage must be reviewed and approved by the Secretary. See generally 29 C.F.R. § 24.111(d)(1) (available at 72 Fed. Reg. 44956 (Aug. 10, 2007)) (settlements must be submitted to OSHA where the complaint arises under the ERA, CAA, SDWA or TSCA; settlements under the FWPCA, SWDA and CERCLA are encouraged to submit their settlements for approval), 1978.111(d)(1) (STAA), 1979.111(d)(1) (AIR21), 1980.111(d)(1) (SOX), 1981.111(d)(1) (PSIA)); see also Beliveau v. U.S. Dept. of Labor , 170 F.3d 83 (1st Cir. 1999), reversing Beliveau v. Naval Undersea Warfare Center , ARB No. 97-097, ALJ Nos. 1997-SDW-1 and 4 (ARB Aug. 14, 1997). OSHA investigators transmit settlements reached during the investigatory stage to the Regional Administrator for approval on behalf of the Secretary. Thus, ALJs are not involved in approving settlements reached prior to a request for an ALJ hearing.

For additional information about the handling of settlements at OSHA, see the Whistleblower Investigations Manual , Chapter 6 , Remedies and Settlement Agreements (updated Oct. 2018).

II. Settlements Reached After Appeal to ALJ or ARB

Aviation Investment and Reform Act
(AIR21)

Parties must submit the settlement to the ALJ or the ARB, and the ALJ or the ARB must approve the settlement. 29 C.F.R. § 1979.111(d)(2). Any settlement approved by the ALJ or the ARB constitutes the final order of the Secretary. 29 C.F.R. § 1979.111(e).

Clean Air Act; Energy Reorganization Act; Safe Drinking Water Act; and Toxic Substances Control Act
(CAA, ERA, SDWA, TSCA)

Where, after the filing of objections to the OSHA determination, the parties agree to a settlement of a complaint filed under the Energy Reorganization Act, the Clean Air Act, the Safe Drinking Water Act, or the Toxic Substances Control Act, a copy of the settlement must be filed with, and approved by, the administrative law judge or the ARB, as the case may be. 29 C.F.R. § 24.111(d)(2) (available at 72 Fed. Reg. 44956 (Aug. 10, 2007)).

Any settlement approved by the ALJ or the ARB constitutes the final order of the Secretary. 29 C.F.R. § 24.111(e) (available at 72 Fed. Reg. 44956 (Aug. 10, 2007)).

Fed. R. Civ. P. 41(a)(1)(i) or (ii) is not applicable where a CAA, ERA, SDWA or TSCA complaint was resolved by settlement. The ARB requires that the parties provide settlement documentation for any other claims arising from the same factual circumstances forming the basis of the federal claim, or a certification that the parties entered into no other such settlement agreements. Beliveau v. Naval Undersea Warfare Center , ARB Nos. 00-073, 01-017, 01-019, ALJ Nos. 1997-SDW-1, 4 and 6 (ARB Nov. 30, 2000), citing Biddy v. Alyeska Pipeline Service Co. , ARB Nos. 96-109, 97-015, ALJ No. 1995-TSC-7 (ARB Dec. 3, 1996), slip op. at 3.

If a settlement judge is used in negotiating a settlement, it is still the presiding judge (or the ARB if the case is pending before that office), rather than the settlement judge, who is responsible for conducting review of the settlement to determine if it is fair, adequate and reasonable. See 29 C.F.R. § 18.9(e)(11) (2006).

Historical note : The Part 24 regulations were revised on August 10, 2007 to implement the Energy Policy Act, and to better harmonize Part 24 with DOL's other whistleblower regulations. The major change to the procedure for approval of settlements is that the ALJ's approval automatically becomes the final decision of the Secretary. 29 C.F.R. 24.111(e) (available at 72 Fed. Reg. 44956 (Aug. 10, 2007)). Prior to August 10, 2007, the ALJ's approval of a settlement was not final until the 10-day period for petitioning for ARB had expired. See 29 C.F.R. § 27.6(f)(1), 24.8(d) (2006). Prior to March 11, 1998, the Secretary or the ARB issued the final order in all Part 24 cases.

Comprehensive Environmental Response, Compensation and Liability Act; Federal Water Pollution Control Act; and Solid Waste Disposal Act
(CERCLA; FWPCA; SWDA)

The Part 24 regulations were revised on August 10, 2007 to implement the Energy Policy Act, and to better harmonize Part 24 with DOL's other whistleblower regulations.

Prior to those revisions, the parties were not required to submit the settlement to the ALJ for complaints grounded in the CERCLA, FWPCA and SWDA, but could simply submit a letter stipulating resolution of their dispute and requesting dismissal of the complaint. The ALJ did not approve the underlying settlement, but rather issued a recommended order of dismissal pursuant to Fed. R. Civ. P. 41(a). See Dorsey v. Greenbriar County Public Service District #2 , 1996-WPC-3 (ARB Sept. 29, 1997); James v. Ketchikan Pulp Co. , ARB No. ARB No. 97-128, ALJ No.1994-WPC-4 (ARB July 23, 1997); Biddle v. United States Dept. of the Army , ARB No. 97-034, ALJ No. 1993-WPC-15 (Sec'y Mar. 29, 1995), adopting (ALJ May 6, 1994); Beliveau v. Naval Undersea Warfare Center , ARB Nos. 00-073, 01-017, 01-019, ALJ Nos. 1997-SDW-1, 4 and 6 (ARB Nov. 30, 2000). Where the parties jointly requested a dismissal, the ALJ did not need to issue an order to show cause pursuant to 29 C.F.R. § 24.6(e)(ii) (2000), prior to ruling on the motion for dismissal. Balog v. Med-Safe Systems, Inc. , ARB No. 99-034, ALJ No. 1995-TSC-9 (ARB Sept. 13, 2000). The ALJ's recommended order of dismissal became final unless a party timely petitioned for review by the ARB. See 29 C.F.R. § 24.7(d) and 24.8(a) (2000).

The August 10, 2007 revisions included a new provision at section 24.111(c) (available at 72 Fed. Reg. 44956 (Aug. 10, 2007)) that is to similar on the AIR21, SOX and STAA model, which does not allow a simple dismissal of a complaint under Rule 41. Rather, when a complainant seeks to dismiss a complaint under this regulatory structure, the ARB has found that the proper procedure is to find that the complainant has withdrawn objections to OSHA's findings, and to reinstate and affirm the OSHA findings. See, e.g., Vodicka v. Dobi Medical International, Inc. , ARB No. 06-037, ALJ No. 2005-SOX-111 (ARB May 30, 2007); Thompson v. Inland Northwest Dairies, LLC , ARB No. 07-085, ALJ No. 2007-STA-31 (ARB July 31, 2007). The AIR21, SOX and STAA regulations, however, all require the submission of a settlement agreement for review and approval by the ALJ or ARB, with such approval becoming the final decision of the Secretary. Thus, section 24.111(c) (available at 72 Fed. Reg. 44956 (Aug. 10, 2007)) has a slightly different context than the AIR21, SOX and STAA model, and it is clear as of the date of this memorandum how an ALJ should treat a voluntary dismissal based on a settlement under the Part 24 revisions.

Sarbanes-Oxley Act (Corporate and Criminal Fraud Accountability Act)
(SOX)

The parties must submit the settlement to the ALJ. 29 C.F.R. § 1980.111(d)(2).

The Sarbanes-Oxley Act incorporates by reference portions of AIR21 procedure, including this language: "At any time before issuance of a final order, a proceeding under this subsection may be terminated on the basis of a settlement agreement entered into by the Secretary of Labor, the complainant, and the person alleged to have committed the violation." The "entered into by the Secretary" language puts SOX settlements into the category of cases in which the settlement must be submitted to the ALJ for approval. See 29 C.F.R. § 1980.111(d)(2).

Pursuant to 29 C.F.R. § 1980.111(e), an ALJ's order approving the settlement of a Sarbanes Oxley Act employee protection complaint constitutes the final order of the Secretary.

Pipeline Safety Improvement Act Whistleblower
(PSIA)

The parties must submit the settlement to the ALJ. 29 C.F.R. § 1981.111(d)(2). The Pipeline Security whistleblower statute uses the "entered into by the Secretary" phrase in regard to settlements, so it is in the category of cases requiring that a settlement be submitted to, and approved by, the ALJ. See, e.g., Heffley v. NGK Metals Corp. , 1989-SDW-2 (Sec'y Mar. 6, 1990) (order to submit settlement).

Any settlement approved by the Assistant Secretary, the administrative law judge, or the ARB constitutes the final order of the Secretary. 29 C.F.R. § 1981.111(e).

Surface Transportation Assistance Act
(STAA)

Parties must submit the settlement to the ALJ or the ARB, and the ALJ or the ARB must approve the settlement. 29 C.F.R. § 1978.111(d)(2). Any settlement approved by the ALJ or the ARB constitutes the final order of the Secretary. 29 C.F.R. § 1978.111(e).