Whistleblower Protection Blog : Whistleblower Lawyer & Attorney : National Whistleblower Legal Defense and Education Fund : Whistleblower Protection, Fraud Claims : Washington DC

OSHA announces interim final rules and

invites public comment on whistleblower procedures

WASHINGTON – The U.S. Department of Labor’s Occupational Safety and Health Administration published in the Aug. 31 Federal Register interim final rules that will help protect workers who voice safety, health, and security concerns. The regulations, which establish procedures for handling worker retaliation complaints, allow filing by phone as well as in writing and filing in languages other than English.

“When workers believe their employers are violating certain laws or government regulations, they have the right to file a complaint and should not fear retaliation. Silenced workers are not safe workers,” said Assistant Secretary of Labor for OSHA David Michaels. “Changes in the whistleblower provisions make good on the promise to stand by those workers who have the courage to come forward when they believe their employer is violating the law and cutting corners on a variety of safety, health and security concerns in the affected industries.”

The regulations, which cover workers filing complaints in the railroad, public transit, commercial motor carrier, and consumer product industries, also create greater consistency among various OSHA complaint procedures. The interim final rules establish procedures and time frames for handling complaints under the whistleblower sections of the Implementing Recommendations of the 9/11 Commission Act of 2007 and the Consumer Product Safety Improvement Act of 2008.

These regulations are effective immediately. Comments must be submitted by Nov. 1, 2010, and can be sent to www.regulations.gov, the Federal eRulemaking Portal, or by mail or fax.

OSHA enforces the whistleblower provisions of the OSH Act and 18 other statutes protecting employees who report violations of various commercial motor carrier, airline, nuclear power, pipeline, environmental, railroad, public transportation, securities, and health care reform laws. New fact sheets on these statutes and additional information will be available at http://www.whistleblowers.gov.

Under the Occupational Safety and Health Act of 1970, employers are responsible for providing safe and healthful workplaces for their employees. OSHA’s role is to assure these conditions for America’s working men and women by setting and enforcing standards, and providing training, education and assistance. For more information, visit http://www.osha.gov.

Both OSHA and an Administrative Law Judge (ALJ) ruled against Vinnett, who did not have a lawyer representing him. The ALJ said that since reporting his concerns was part of his job duties, his reports were not protected by the Energy Reorganization Act (ERA). The ARB disagreed. On p. 11, the ARB says, "there is nothing in the language of the ERA that carves out an exception limiting whistleblower protection based on an employee’s job duties. *** Nuclear safety is encouraged by protecting workers from retaliation because they report safety concerns." Quoting Mackowiak v. University Nuclear Sys., 735 F.2d 1159 (9th Cir. 1984), the ARB adds, “The [Secretary’s] ruling simply forbids discrimination based on competent and aggressive inspection work. In other words, contractors regulated by [the ERA] may not discharge quality control inspectors because they do their jobs too well.” The ARB said that the ALJ had not cited any authority for denying protection to "duty speech." The ALJ could have cited the controversial U.S. Supreme Court decision of Garcetti v. Ceballos, 547 U.S. 410 (2006). In Garcetti though, the high court indicated that its ruling denying protection applied only to claims against government officials under the First Amendment, and it did not apply to rights under whistleblower protection laws. The ARB does not mention Garcetti in this decision.

On page 13, the ARB made some helpful observations about discovery.  It noted that Vinnett did not have an attorney, but did complain about not getting all the information he wanted from the company.  The ALJ denied him permission to make a motion to compel that discovery. The ARB asked the ALJ to reconsider that decision, or directly order the company to provide requested documents like the outage log, weekly reports, Vinnett's personal log, and not to just accept the employer's word about which parts were relevant. The ARB makes clear that complainants are entitled to a fair opportunity to compel discovery before an ALJ issues summary judgment.

In Bucalo v. United Parcel Service, ARB No. 08-087, ALJ No. 2006-TSC-2 (ARB July 30, 2010), the ARB affirmed a dismissal of Samuel Bucalo's complaint under the Toxic Substances Control Act (TSCA) and the Surface Transportation Assistance Act (STAA). Bucalo has worked for UPS since 1979 in Sharonville, Ohio (near Cincinnati). He is also a union steward for the International Brotherhood of Teamsters, Local 100. In 2005, a coworker asked him to investigate a mercury spill. Bucalo testified that he was concerned about the safety of other employees (which would point to the weak protections of Section 11(c) of the OSHA Act, and not toward the environmental protections in TSCA). Bucalo found a UPS engineer who showed Bucalo how the affected area had been blocked off by caution tape. The next day, management suspended Bucalo and escorted him off the premises for creating a "chaotic situation." (What whistleblower complaint does not create a "chaotic situation" in the eyes of management?) UPS decided Bucalo should receive a one day suspension for this offense. Three days later, Bucalo performed an inspection of the premises when a UPS supervisor ordered him to leave.  Bucalo insisted he had a right to investigate, and an argument erupted before Bucalo finally left.  UPS fired Bucalo that day for failing to leave when first asked.

The ARB agreed with the ALJ that Bucalo's activities were on behalf of employee safety and not the environment, and are therefore not protected by TSCA. This holding fails to consider how employee safety activities can also touch on environmental safety. Moreover, it is the employer's statement of mind that makes retaliation unlawful, not the employee's. Brock v. Richardson, 812 F.2d 121, 123-25 (3d Cir. 1987); Willy v. Coastal Corp., 85-CAA-1, SOL D&O at 13-14 (June 1, 1994) (holding that employer's mistaken belief about protected activity is sufficient to make retaliation unlawful). If UPS was afraid that Bucalo's investigation could lead to environmental enforcement activity, that should be sufficient to provide TSCA protection. The ARB held that UPS fired Bucalo for failing to follow the orders to leave, and not for protected activity. The "filed or about to be filed" language in the environmental laws also appears in the anti-retaliation prohibition of the False Claims Act, and in that context protects employees who are collecting information about possible fraud "before they have put all the pieces of the puzzle together." See, e.g., U.S. ex rel. Yesudian v. Howard University, 153 F.3d 731, 739-40 (D.C. Cir. 1998). ARB member Wayne Beyer, the only hold-over from the Bush administration, wrote a concurring opinion to emphasize that in his view, reporting a violation is protected, but not asking questions. He reached this conclusion without citing the Yesudian case. Bucalo did not have a lawyer for his DOL case.  Hopefully he will do better with labor-management arbitration. If other whistleblowers have claims arising from retaliation for asking questions, hopefully they will find this cite to the Yesudian case and ask the ARB to change this holding.

Here is more of the Sixth Circuit's opinion:

To hold that the doctrine of equitable tolling should be applied in this case is clearly in keeping with the principle underlying our opinion in Andrews, the cases upon which it relied and the opinions that it spawned: that a complainant should not be punished for missing a filing deadline when he is affirmatively misled in a manner that causes the delay. As we observed in Jones, equitable tolling is appropriate when “congressional purposes [are] effectuated by tolling the statute of limitations in given circumstances.” 747 F.2d at 1040 (quoting Burnett v. New York Central R.R. Co., 380 U.S. 424 (1965)).

The purpose of the Transportation Act’s employee-protection provisions is “to encourage employee reporting of noncompliance with safety regulations governing commercial motor vehicles.” Brock v. Roadway Express, Inc., 481 U.S. 252, 258 (1987). When a statute permits a complainant’s representation before an agency by counsel and counsel has informed the agency that he represents the complainant and has provided the agency with his contact information, the complainant may reasonably expect that counsel will at least be copied on the agency’s communications to him. When the agency sends its findings directly to the complainant with a clear indication that his counsel has contemporaneously received those same findings, but does not actually notify counsel until after expiration of the statutory period for filing objections, the refusal to permit a late objection is unjust. This injustice threatens the purposes of the Act’s employee-protection provisions, and a grant of equitable tolling in Smith’s case is consistent with effectuating them.

I particularly appreciate the Court's focus on the purpose of the Surface Transportation Assistance Act (STAA).  Many bad whistleblower decisions would go in our favor if the courts shared this type of focus on the statutory purpose.

Harry Smith's prospects of prevailing on remand are pretty good when one considers that he has already prevailed after a hearing against CRST's contractor, Lake City Enterprises. You can read the 153-page decision of the Administrative Law Judge (ALJ) here. I can also provide you with:

• My brief
• DOL's brief
• CRST's brief
• My reply brief
• The Sixth Circuit's opinion

Here is the text of our letter:

July 21, 2010

Paul M. Igasaki, Chair & Chief Judge

Administrative Review Board

U.S. Department of Labor

2000 Constitution Ave., N.W., N5404

Washington, D.C. 20210

Re: Johnson v. Siemens Building Technologies, Inc., ARB No. 08-032/ALJ No. 2005-SOX 015

Dear Chair and Chief Judge Igasaki:

We are writing in further regard to the briefing order issued in the above-captioned case on April 15, 2010 and your letter issued today.

As you are aware, today President Obama signed into law the Dodd-Frank Wall Street Reform Act, which directly impacts the issue under consideration in this case. The Dodd-Frank Act amends The Sarbanes–Oxley Act of 2002 (SOX) to include liability for subsidiary companies. Based on the text of this amendment and its legislative history the issue of subsidiary coverage under SOX should be readily resolved.

The portion of Dodd-Frank that concerns subsidiary coverage is contained in Section 929A of the Act. The legislative history for this section is set forth on page 114 of Senate Report No. 111-176. A copy of the relevant page of the report is attached.

The Report explains that section 929A amended section 806 of the Sarbanes-Oxley Act of 2002 in order to “make clear that subsidiaries and affiliates of issuers may not retaliate against whistleblowers . . . .” The amendment was designed to eliminate the current employer defense that subsidiaries of publicly traded corporations somehow were not covered under SOX, and explicitly clarified the original intent of the statute: The “clarification” contained in section 929A “would eliminate a defense now raised in a substantial number of actions brought by whistleblowers under the statute.” ¹

Congress’ use of the phrase “make clear” in explaining the legislative intent behind the amendment was not an accident. This precise phrase was used in another leading case interpreting a similar whistleblower law, also administered by the Department of Labor. In Willy v. Administrative Review Bd. 423 F.3d 483, 489, n. 11 (5th Cir. 2005), the Fifth Circuit gave effect to a similar legislative action on the basis that the legislative history and indicated that such an amendment is intended to “make clear” the original intent: “The legislative history of the 1992 Energy Policy Act, too, makes clear that Congress intended the amendments to codify what it thought the law to be already.” (Emphasis added). Accord., Kansas Gas & Elec. Co. v. Brock 780 F.2d 1505, 1512 (10th Cir. 1985) (applying amendment to law as indication of Congress’ original intent).

Based on section 929A of the Dodd-Frank Act, and consistent with this section’s legislative history and controlling case law, we believe the issue of subsidiary coverage has been resolved by explicitly and clear legislative action. It is now imperative that the Department of Labor effectuate this intent, and ensure that the SOX is fully and properly administered in a manner intended by Congress.

Respectfully submitted,

Stephen M. Kohn

Executive Director

Richard R. Renner

Legal Director

Enclosure: Page 114 from S. Rep. 111-176

Mr. Brown said that about 80% of the ARB's case load consists of whistleblower cases. It currently has a backlog of about 160 cases.  About 155 new cases are filed each year, and the ARB expects that number to increase.

Stephen Kohn said that in 1984, he testified about the need for the Department to have rules of appellate procedure and he is glad to see movement on that goal.  A lively discussion followed about how quickly counsel could complete briefing in whistleblower cases with a consensus urging the board to allow more time, and continue the current leniency on extension of time.  Concerns were also raised about the propose standard of review, and rushing to avoid the time limits in which complainants could go to U.S. District Court. 

Mr. Kohn explained how traditionally, DOL judges were happy to facilitate complainants who wanted to bring their cases in other forums without interference from DOL proceedings.  They would gladly dismiss cases without prejudice to allow complainants to go elsewhere.

To speed up case processing, the preliminary draft of the rules proposes that complainants file their briefs at the same time as their petition for review (unless the petition for review is due in a time that is less than 30 days from the ALJ decision, in which case complainant will have 30 days from the petition for review to file a brief). Also, the ARB proposed requiring an appendix of relevant parts of the record. This will allow ARB staff to start reviewing the record without waiting for it to arrive from the ALJ.  I suggested that the speedy briefing and appendix be optional.  If a complainant wants to go fast, then that complainant can file an early brief and appendix.  However, I urged the Board members to decide cases on the merits, even if that takes longer because a party is not able to write briefs so quickly or file an appendix.  The ARB's General Counsel, Janet Dunlap, said that over half of the ARB's cases have a party appearing without a lawyer's representation. Mr. Brown noted that the proposed rules have a second chance provision for pro se litigants in which if the Board rejects a filing, they can have 10 days to file it correctly.  Also, if a litigant discovers that an issue was not included in the petition for review, they can move to amend that petition.  Perhaps a brief could be deemed to be an amended petition for review. Mr. Kohn said that the Federal Rules of Appellate Procedure (FRAP) call for a process that is about as fast as experienced counsel can go, and the ARB should not require a schedule that is any faster.  It would be contrary to the remedial goal of the whistleblower statutes. Mr. Paul Frieden of the Solicitor of Labor's office urged the Board to be more receptive to extensions of time. If his office needed say 30 days, and the ARB allowed only ten, that would be "extremely difficult" for his office. Mr. Colapinto explained how most ARB cases focus on the mixed question of an employer's true motives.  This is a complex issue that cannot be rushed.

Attenders agreed that the ARB should consider alternative dispute resolution (ADR). Mr. Igasaki expressed that he was interested in this possibility.  Perhaps the Board will consider requiring parties to participate in a mediation, at least to allow a trained mediator to assess if their is a reasonable prospect of settling a case.  This service is presently available through the Office of Administrative Law Judges (OALJ) Settlement Judge Program.

I also urged the Board to reconsider its proposal for a limited scope of review of factual findings. Issuing regulations would tie the Board's hands as it would then be legally compelled to follow its own rules.  I suggested that the ARB could use a "substantial evidence" test in most cases, but still reserve its right to conduct a de novo review in cases where it finds that such review would better accomplish the purposes of the employee protections. Mr. Kohn agreed that de novo review was more appropriate when reviewing the mixed question of an employer's true motives. He also suggested that an appendix be allowed as an option when a party can select the key items of evidence that will really make a difference in a case.

The ARB decided that it should use Iqbal because the Department of Labor (DOL) does not have its own rule equivalent to FRCP 12(b)(6), the rule that allows courts to dismiss cases that fail to state a claim for relief. However, DOL does have a rule on the requirements for an OSHA complaint. That rule is 29 CFR 24.103(b). This rule states, “No particular form of complaint is required, except that a complaint must be in writing and should include a full statement of the acts and omissions, with pertinent dates, which are believed to constitute the violations.” It seems pretty clear to me, and to the dissenting ARB member, Judge E. Cooper Brown, that this rule makes Iqbal inapplicable to OSHA whistleblower complaints. That is the main point of the

I filed for Douglas Evans.

Douglas Evans was an employee of the U.S. Environmental Protection Agency (EPA) in Las Vegas, Nevada, for 17 years. He was a technician who repaired equipment. EPA managers in Las Vegas were under pressure to get a high rate of their employees to “volunteer” for emergency response work. Evans recalls getting an order to participate. He wrote a letter to the EPA Administrator, and his supervisors never forgave him for it. Evans' letter complained about the lack of training for the emergency response work, and about other aspects of the plan. I recognized that a concern about lack of training for emergency response work is an environmental concern. I filed Evans' complaint with OSHA under the federal environmental laws. Shortly thereafter, Evans' bosses fired him on trumped up charges. I filed a supplemental complaint against the discharge. OSHA dismissed. I requested a hearing before an Administrative Law Judge (ALJ). I asked for discovery from EPA. EPA made a motion to dismiss, and to stay discovery while its motion is pending. I opposed the motion to dismiss, citing the DOL's rule that there is “no particular form of complaint.” I also provided statements from two of Evans' co-workers supporting his complaint, and explained how the discharge in retaliation for his first OSHA complaint is certainly protected. Still, the ALJ dismissed the case, and now the ARB has affirmed.

With Evans' permission, I am posting the ARB decision, and my motion for reconsideration. They may serve as a warning to other whistleblowers about how they must pay more attention to detailing their protected activity in OSHA complaints. Perhaps the ARB will not be so eager to dismiss in cases where the respondent is someone other than a federal agency. Let's hope so. I am also hopeful that the majority members of the ARB may have an open heart as the review the motion for reconsideration.

This case is not over, but Evans' career is. He has lost his job and his home, and cannot find other work.
 

TIMELINESS OF COMPLAINT; EQUITABLE ESTOPPEL BASED ON ACTS OR OMISSIONS BY THE RESPONDENT THAT LULL THE PLAINTIFF INTO INACTION

TIMELINESS OF COMPLAINT; EQUITABLE TOLLING OR EQUITABLE ESTOPPEL; GIVEN FACT INTENSIVE NATURE OF ISSUE, ALJ MAY NOT RELY MERELY ON AFFIDAVITS GIVEN IN RESPONSE TO AN ORDER TO SHOW CAUSE TO ESSENTIALLY DISPOSE OF A CASE BASED ON SUMMARY DECISION

In Hyman v. KD Resources, ARB No. 09-076, ALJ No. 2009-SOX-20 (ARB Mar. 31, 2010), the ALJ issued an Order to Show Cause, sua sponte, directing the Complainant to show cause as to why the complaint should not be dismissed because it was not timely filed. The ALJ found that the Complainant's response lacked necessary evidence to support equitable tolling, and dismissed the complaint. On appeal, however, the ARB found that "the evidentiary documents submitted by Hyman in response to the Order to Show Cause that one or more of the Respondents' officials and/or agents (either or all) led Hyman to reasonably believe that he would be returned to his former employment or alternatively given a one-year consulting contract, that he would be financially compensated for having been wrongfully terminated (including payment of back salary), and that KD Resources would resolve the SOX compliance issues that Hyman had raised." USDOL/OALJ Reporter at 8. The ARB found that this showing was sufficient to establish a basis for applying equitable estoppel under the ground that "...the employer's own acts or omissions have lulled the plaintiff into foregoing prompt attempts to vindicate his rights." USDOL/OALJ Reporter at 7, quoting Bonham v. Dresser Indus., 569 F.2d 187, 193 (3d Cir. 1978). The ARB stated that "Under this basis for equitable estoppel it is immaterial whether the defendant engaged in intentional misconduct." Id.

The ARB stated that the circumstances of the instant case were distinguishable from a party's reliance upon settlement negotiations, which does not toll the running of the statute of limitations. The ARB stated that its holding was limited to a finding that the Complainant's "response to the ALJ's Order to Show Cause met the minimal requirements necessary to invoke equitable estoppel as a basis for tolling the running of the period for filing his complaint,"USDOL/OALJ Reporter at 9, and left it to the ALJ on remand to determine the issue of the timeliness on a more fully-developed evidentiary record.

In this regard, the Board indicated that the ALJ's procedure for determining the issue of timeliness had been inappropriate. The Board wrote:

The ALJ's disposition pursuant to the Order to Show Cause effectively constituted a disposition by way of summary decision pursuant to 29 C.F.R. §§ 18.41 (2009). As such we consider it to have been an inappropriate procedure for resolving the timeliness issue given the fact intensive nature of the considerations that must be resolved where equitable tolling or equitable estoppel is invoked. The courts have repeatedly held that whether equitable modification should be applied to toll the running of a statute of limitations is a fact intensive determination requiring close examination of the facts and equities. .... For example, such determinations almost invariably involve the credibility of witnesses. Consequently, as the Tenth Circuit has noted, "the issue of equitable tolling and estoppel [cannot] be resolved on the basis of the affidavits" because of the difficulty of determining credibility therefrom" Wilkerson v. Siegfried Ins., 621 F.2d 1042, 1044 (10th Cir. 1980).

USDOL/OALJ Reporter at 9 (some citations omitted).

[Editor's note: But see Warner v. Xcel Energy, ARB No. 08-112, ALJ No. 2008-ERA-2 (ARB Mar. 29, 2010), in which the ARB affirmed the ALJ's findings that the complainant had failed to show good cause for his failure to timely file his ERA complaint, and did not criticise the ALJ's use of an order to show cause to address the timeliness issue, even though the complainant had alleged deception by the Employer.

The Warner decision turned on the fact that the Complainant was basing his deception argument on inability to timely obtain evidence to confirm his suspicion of retaliation. Thus, it appears that using an order to show cause is not an inherently inapproprate technique for an ALJ to address the issue of timeliness, but only that it may not be adequate if an issue of fact or witness credibility is material to the equitable ground being proffered.]