Sarbanes-Oxley and other federal whistleblower protections
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Sarbanes-Oxley and other federal whistleblower protections
2004-02-21, updated 2006-08-16
By: Richard Renner, Tate & Renner, 505 N. Wooster Ave., P.O. Box 8, Dover, OH 44622; 330-364-9900, firstname.lastname@example.org, www.taterenner.com
A. Goals for this lecture are for participants to be able to
II. Whistleblower protection, what is it?
B. The right to assist in enforcement actions without retaliation.
C. Why does government provide employee protections?
III. The sources of the law
D. The Acts
E. The regulations
F. Legislative History and purpose
G. Construction is patterned after the NLRA, and Civil Rights Act of 1964.
H. Remedial statutes are construed broadly to accomplish their purpose
IV. Protected activity
I. What can employees do to get under the umbrella of protection?
J. What can an employee do to leave the umbrella, and lose protection?
K. Complaints must have a nexus to the safety or environmental purpose of the statute.
V. Discrimination has many forms.
L. The definition of discriminatory acts under 29 C.F.R. Part 24 is extremely broad.
M. Restraints on protected activities
VI. Procedures for complaints
N. Filing a complaint
O. Time limits for Environmental Whistleblowers: 30 days
P. Sarbanes-Oxley and AIR 21: 90 days
Q. Nuclear Whistleblowers and Surface Transportation: 180 days
R. Investigation, hearing, and appeals
S. Appeals from the ALJ RD&O
T. Direct civil action
U. Elements of the claim
V. Methods of proving retaliation
X. Sarbanes-Oxley criminal retaliation
VII. Other sources of information
National Whistleblower Center flyer for Concepts and Procedures in Whistlebower
National Whistleblower Center flyer for Attorney Referral Service (ARS)
Excerpts: Federal Whistleblower Laws and Regulations reprinted with permission
Sarbanes-Oxley employee protection, 18 USC 1514A
Sarbanes-Oxley regulations, 24 CFR Part 1980
Environmental and Nuclear Whistleblower regulations, 24 CFR Part 24
Welch v. Cardinal Bankshares Corp., 2003-SOX-15 (ALJ Jan. 28, 2004), excerpts
"Protected activity," as defined under the Act and relevant regulations, includes, inter alia, providing (or causing to be provided) to an employer or to the Federal Government information regarding any conduct which the employee reasonably believes constitutes a violation of various fraud provision of Title 18 of the U.S. Code (§§ 1341, 1343, 1344, or 1348), any rule or regulation of the SEC, or any provision of Federal law relating to fraud against shareholders. 18 U.S.C. § 1514A (a)(1); see also 29 C.F.R. § 1980.102 (a), (b)(1). This statutory language makes it clear that Complainant is not required to show the reported conduct actually constituted a violation of the law, but only that he reasonably believed Respondent violated one of the enumerated laws and regulations. See id. The standard for determining whether Complainant's belief is reasonable involves an objective assessment. See, e.g., Minard v. Nerco Delamar Co., 92-SWD-1 (Sec'y Jan. 25, 1995), slip op. at 8.
- Goals for this lecture are for participants to be able to:
- Recognize potential administrative claims in time to meet the 30, 90 and 180 day time limits.
- Understand what whistleblowing is, why government and the public health need whistleblowers
- Know how to file a complaint
- Know where to go for help
- Whistleblower protection, what is it?
- The right to assist in enforcement actions without retaliation.
- The federal environmental laws protect workers who have commenced, or are about to commence, a proceeding for enforcement of any requirement imposed under the law, or under an applicable implementation plan. They protect employees who have testified, or are about to testify in a proceeding to enforce the law.
- Why does government provide employee protections?
- Encourage witnesses to come forward. Bribery?
- Open the flow of information to enforcement authorities
- Enforce the laws through the continued employment of law-followers
- Political pressures on legislators
- The sources of the law
- The Acts
- Water Pollution Control Act (WPCA, commonly called the Clear Water Act or CWA), 33 U.S.C. 1367
- The WPCA, Section 507(a), 33 USC 1367(a) provides as follows:
No person shall fire, or in any other way discriminate against, or cause to be fired or discriminated against, any employee or any authorized representative of employees by reason of the fact that such employee or representative has filed, instituted, or caused to be filed or instituted any proceeding under this chapter, or has testified or is about to testify in any proceeding resulting from the administration or enforcement of the provisions of this chapter.
- Safe Drinking Water Act (SDWA), 42 U.S.C. 300j-9(i)
- The SDWA provides in its section 1450, 42 USC 300j-9(I)(1) as follows:
(1) No employer may discharge any employee or otherwise discriminate against any employee with respect to his compensation, terms, conditions, or privileges of employment because the employee (or any person acting pursuant to a request of the employee) has
(A) Commenced, caused to be commenced, or is about to commence or cause to be commenced a proceeding under this subchapter or a proceeding for the administration or enforcement of the drinking water regulations or underground injection control programs of a State,
(B) Testified or is about to testify in any such proceeding, or
(C) Assisted or participated or is about to assist or participate in any manner in any such proceeding or in any other action to carry out the purposes of this subchapter.
- Toxic Substances Control Act (TSCA), 15 U.S.C. § 2622
- Solid Waste Disposal Act (SWDA), 42 U.S.C. § 6971, also called the Resource Conservation and Recovery Act (RCRA).
- Clear Air Act (CAA), 42 U.S.C. § 7622
- Energy Reorganization Act of 1974 (ERA, which includes atomic energy), 42 U.S.C. § 5851, amended in 1992
- Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA or "Superfund Law") , 42 U.S.C. § 9610 (1988)
- Surface Transportation Act (STA), 49 USC § 31105
- Wendell H. Ford Aviation Investment and Reform Act for the 21st Century ("AIR 21"), 49 U.S.C. § 42121. (protecting employees of air carriers from discharge or other discrimination from reporting safety violations).
- Sarbanes-Oxley Act of 2002 (Title VIII), 18 U.S.C. §1514A ("Sarbanes-Oxley") enacted on July 30, 2002. Public Law 107-204, Section 806 of the Corporate and Criminal Fraud Accountability Act of 2002
- TSCA and SWDA provide for "exemplary damages" so be sure to cite them in any charges. See page 20 below.
- The regulations
- 29 CFR Part 24, with procedures set out at 29 CFR Part 18.
- 29 CFR Part 1978 for the Surface Transportation Act
- 29 CFR part 1979 for AIR 21
- 29 CFR Part 1980 for Sarbanes-Oxley
- 10 CFR §§ 2.206, 50.7, 708, 820 (App. A [XIII]) for NRC whistleblower regulations
- Legislative History and purpose
- Congress passed the first employee protection, the WPCA, in 1972, because
the best source of information about what a company is actually doing or not doing is often its own employees, and this amendment would ensure that an employee could provide such information without losing his job or otherwise suffering economically from retribution from the polluter.
- Sixth Circuit Justice George Edwards, Jr., wrote that Congress' intent in passing 42 U.S.C. 5851, the Energy Reorganization Act, was to "encourage employees" to report "unsafe practices in one of the most dangerous technologies mankind has ever invented." Rose v. Secretary of Department of Labor (6th Cir. 1986), 800 F.2d 563, 565 (J. Edwards concurring). He explains:
If employees are coerced and intimidated into remaining silent when they should speak out, the result can be catastrophic. Recent events here and around the world underscore the realization that such complicated and dangerous technology can never be safe without constant human vigilance. The employee protection provision involved in this case thus serves the dual function of protecting both employees and the public from dangerous radioactive substances.
This statutory provision prohibits any company with a class of securities registered under §12 of the Security Exchange Act of 1934, or required to file reports under §15(d) of the same Act, or any officer, employee, or agent of such company, from discharging, harassing, or in any other manner discriminating against an employee in the terms and conditions of employment because the employee provided to the employer or Federal Government information relating to alleged violations of 18 U.S.C. §§1341, (mail fraud), 1343 (wire fraud), 1344 (bank fraud) and 1348 (securities fraud), any rule or regulation of the Securities and Exchange Commission ["SEC"], or any provision of Federal law relating to fraud against shareholders.
- In enacting Sarbanes-Oxley, Congress was well aware that the previous state of the law left corporate whistleblowers highly vulnerable. The Senate Judiciary Committee found that whistleblower protections were dependent on the "patchwork and vagaries" of varying state statutes, even though most publicly traded companies do business nationally. As it pointedly noted, "companies with a corporate culture that punishes whistleblowers for being 'disloyal' and 'litigation risks' often transcend state lines. As a result, most corporate employers, with help from their lawyers, know exactly what they can do to a whistleblowing employee under the law." Congress therefore acted to protect employees who report fraudulent activity which could harm innocent investors. S. Rep. No. 107-146, 107 th Cong., 2d Session 19 (2002).
- These acts were identified by sponsoring Senator Leahy as all the types of "schemes and artifices" that may be devised by "inventive criminals" to defraud. See Legislative History of Title VIII of HR 2673: The Sarbanes-Oxley Act of 2002, Congressional Record: July 26, 2002, section-by-section analysis of sponsoring Senator Patrick Leahy, 148 Cong. Rec. at S7421.
- The DOLís Administrative Review Board has held in two decisions that protected conduct includes raising concerns to management about a violation of any rule or regulation of the Securities and Exchange Commission, or any provision of Federal law relating to fraud against shareholders. See Allen v. Stewart Enterprises, Inc., ARB No. 06-081, ALJ Nos. 2004-SOX-60 to 62 (ARB July 27, 2006); See Klopfenstein v. PCC Flow Technologies Holdings, Inc., ARB No. 04-149, ALJ No. 2004-SOX-11 (ARB May 31, 2006). There are, however, at least three opinions by federal judges holding that protected conduct is limited to concerns that implicate shareholder fraud.
- Allen B. Roberts provides this employer perspective from The Sarbanes-Oxley Act: Employment Implications For Privately Held and Publicly Traded Companies, Allen B. Roberts, April 2, 2003, Epstein Becker & Green, P.C.:
After corporate scandals shook investor confidence in 2001-2002, Congress reacted at lightning speed, passing the Sarbanes-Oxley Act. The law seemed correct for its time, passing in the Senate with no negative votes and overwhelmingly in the House. That combination of speed and apparently universal support may conceal fundamental compliance problems for employers and mask enforcement problems for regulators while it offers up a new bonanza of profitable litigation for lawyers in the plaintiffs' bar and their clients.
- The "filed or about to be filed" language 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)
- Because the federal environmental laws were modeled after the Nation Labor Relations Act (NLRA, 29 U.S.C. 158(a)(4)) and the 1969 Federal Mine Safety Act (FMSA), 30 U.S.C. 820(b), the Secretary of Labor and the courts have used mine safety and NLRA precedent to interpret the federal law. See, for example, DeFord v. Secretary of Labor (6th Cir. 1983), 700 F.2d 281, 286. The remedial purpose, and resulting broad interpretation, of employee protection provisions under the NLRA are described in NLRB v. Scrivener (1972), 405 US 117, 121-26.
- Construction is patterned after the NLRA, and Civil Rights Act of 1964.
- Because all seven environmental and nuclear employee protection acts share similar statutory language and legislative histories, case law under one of the acts is readily used for interpreting other acts. Poulos v. Ambassador Fuel Oil Co., Inc., No. 86-CAA-1, D&O of Remand by SOL, at 5 (April 27, 1987).
- The Secretary of Labor uses the same burdens of production and persuasion that federal courts use under Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e, and sequence. Carroll v. Bechtel Power Corp., Case No. 91-ERA-0046, D&O of Remand by SOL, at 10, (Feb. 15, 1995), affirmed Carroll v. USDOL, 78 F.3d 352 (8th Cir. 1996)
- Remedial statutes are construed broadly to accomplish their purpose
- The seven environmental whistleblower protection laws under which this complaint was filed were passed in order to "encourage" employees to report safety violations and protect their reporting activity. English v. General Elec. Co., 496 U.S. 72, 110 S.Ct. 2270, 2277, 110 L.Ed.2d 65 (1990); Wagoner v. Technical Products, Inc., 87-TSC-4, D&O of SOL, p. 6 (November 20, 1990)(the "paramount purpose" behind the whistleblower statutes is the "protection of employees").
- The U.S. Court of Appeals for the Third Circuit has approvingly noted that the courts have "consistently construed" the environmental whistleblower laws "to lend broad coverage" to employees. Passaic Valley Sewerage Comm. v. Department of Labor, 992 F.2d 474, 479 (3rd Cir. 1993).
- The Third Circuit's posture completely accords with Department of Labor interpretation of these laws:
. . . from the legislative history and the court and agency precedents . . . it is clear that Congress intended the 'whistleblower' statutes to be broadly interpreted to achieve the legislative purpose of encouraging employees to report hazards to the public and protect the environment by offering them protection in their employment.
Faulkner v. Olin Corp., 85-SWD-3, R. D&O of ALJ, pp. 5-6 (August 16, 1985), adopted by the SOL (November 18, 1985).
- To achieve these ends, the law mandates that "employees must feel secure that any action they may take" furthering "Congressional policy and purpose, especially in the area of public health and safety, will not jeopardize either their current employment or future employment opportunities." Egenrieder v. Metropolitan Edison Co./GPU, 85-ERA-23, Order of Remand by SOL, pp. 7-8 (April 20, 1987).
- Consequently, when interpreting a case under these laws, there is a need for "broad construction" of the statutes in order to effectuate their purposes. DeFord v. Secretary of Labor, 700 F.2d 281,286 (6th Cir. 1983). "Narrow" or "hypertechnical" interpretations to these laws, are to be avoided as undermining Congressional purposes. Kansas Gas & Elec. Co. v. Brock, 780 F.2d 1505, 1512 (10th Cir. 1985).
- First ALJ decision on Sarbanes-Oxley is reported at:
- Protected activity
- What can employees do to get under the umbrella of protection?
- The Secretary of Labor, following judicial precedent, has consistently given a broad interpretation to the scope of protected activity under the environmental whistleblower protection acts. See, e.g. Guttman v. Passaic Valley Sewerage Comm., 85-WPC-2, D&O of SOL, pp. 10-13 (March 13, 1992), aff'd, Passaic Valley Sewerage Comm. v. U.S. Department of Labor, 992 F.2d 474, 478-79 (3rd Cir. 1993); Willy v. Coastal Corp., 85-CAA-1, D&O of SOL, p. 13 (June 1, 1994).
- Protected activity can be found in reporting violations directly to a government agency, including state or local governments. Merely threatening to disclose violations to the government can create protection. Hanna v. School District of Allentown, 79-TSCA-1, D&O of SOL p. 11 (July 28, 1980), rev'd on other grounds, School Dist. of Allentown v. Marshall, 657 F.2d 16 (3rd Cir. 1981); Mandreger v. Detroit Edison Co., 88-ERA-17, D&O of SOL, p. 14 (March 30, 1994); Helmstetter v. Pacific Gas & Electric Co., 91-TSC-1, D&O of Remand by SOL, p. 7 (January 13, 1993)
- One case has found that a report to a union safety committee created protection. Cotter v. Consolidated Edison Co. of NY (7-7-81), No 81-ERA-6, affirmed, Consolidated Edison Co. of NY v. Donovan (2d Cir. 1982), 673 F.2d 61.
- Making reports to an environmental activist or the news media may also be considered protected.
- The Secretary of Labor has held that internal complaints are protected. Cases holding that an employee's internal complaints, concerning potential environmental violations, are fully protected are: Carson v. Tyler Pipe Co., 93-WPC-11 (Sec'y Mar. 24, 1995); Willy v. Costal Corp., 85-CAA-1, D&O of SOL at 13-14 (March 30, 1994). Adams v. Coastal Production Operators, Inc., Case No. 89-ERA-3, Dec. and Order of Remand, Aug. 5, 1992, slip op. at 9 (August 5, 1992); Kansas Gas & Elec. Co. v. Brock, 780 F.2d 1505 at 1513 (10th Cir. 1985); Dysert v. Westinghouse Electric Corp., Case no. 86-ERA-39, Final Dec. and Order, Oct. 30, 1991, slip op. at 1-3. See also Mackowiak v. University Nuclear Systems, Inc., 735 F. 2d 1159, 1163 (9th Cir. 1984) (employers may not discharge employees engaged in quality control because they do their jobs too well); Bassett v. Niagara Mohawk Power Co., 86-ERA-2 (Sec'y, July 9, 1986); Artayet v. Morrison Knudsen Corp., 97-ERA-34 (ALJ Oct. 28, 1997). According to the Secretary, an internal complaint should be a protected activity because the employee has taken his or her environmental concern first to the employer to permit a chance for the violation to be corrected without government intervention. Poulos v. Ambassador Fuel Oil Co., Inc., 86-CAA-1 (Sec'y Apr. 27, 1987)(order of remand). The report may be made to a supervisor, or through an internal complaint or quality control system, or to an environmental staff member. Williams v TIW Fabrication & Machining, Inc. 88-SWD-3 (Sec'y June 24, 1992); Bassett v. Niagara Mohawk Power Corp., 85-ERA-34 (Sec'y Sept. 28, 1993); and, Helmstetter v. Pacific Gas & Electric Co., 91-TSC-1 (Sec'y Jan. 13, 1993).
- In Carson v. Tyler Pipe Co., 93-WPC-11 (Sec'y Mar. 24, 1995), the Secretary held that internal complaints are protected activity under the SWDA and the WPCA, even in the Fifth Circuit. The Secretary distinguished Brown & Root, Inc. v. Donovan, 747 F.2d 1029 (5th Cir. 1984), based on the 1992 amendments to the ERA, which legislatively overturned that decision.
- The Carson decision is available at: http://www.oalj.dol.gov/public/wblower/decsn/93wpc11b.htm
- The scope of "protected activity" includes refusal to engage in unlawful discrimination or retaliation. EEOC v. Crown Zellerbach Corp., 720 F.2d 1008, 1013 (9th Cir. 1983), arises from a comparable anti-discrimination context.
- Unlike the False Claims Act, the federal Environmental Employee Protection Provisions do not contain any requirement that the complainant be the first person to report wrongdoing. It is sufficient that the complainant assists with ongoing or potential enforcement activities. Indeed, it does not matter whether any wrongdoing is ever established. The government depends on the employee protection provisions to assure all comers that they can share their reasonable suspicions without fear of retaliation. In construing the comparable language under the ERA, the U.S. Supreme Court held, "Since many retaliatory incidents are a response to safety complaints made to the Federal Government, the Government is already aware of these safety violations even if employees do not invoke 210's remedial provisions." English v. General Elec. Co., 496 U.S. 72, 110 S.Ct. 2270, 110 L.Ed.2d 65 (1990).
- In Welch v. Cardinal Bankshares Corp., 2003-SOX-15 (ALJ Jan. 28, 2004), attached, ALJ Purcell stated:
- ALJ Purcell rejected respondent's claim that Welch's allegations were based on mere "assumptions and imagined facts that were not true".
- Sarbanes-Oxley specifically protects:
(1) to provide information, cause information to be provided, or otherwise assist in an investigation regarding any conduct which the employee reasonably believes constitutes a violation of section 1341, 1343, 1344, or 1348, any rule or regulation of the Securities and Exchange Commission, or any provision of Federal law relating to fraud against shareholders, when the information or assistance is provided to or the investigation is conducted by
(A) a Federal regulatory or law enforcement agency;
(B) any Member of Congress or any committee of Congress; or
(C) a person with supervisory authority over the employee (or such other person working for the employer who has the authority to investigate, discover, or terminate misconduct); or
(2) to file, cause to be filed, testify, participate in, or otherwise assist in a proceeding filed or about to be filed (with any knowledge of the employer) relating to an alleged violation of section 1341, 1343, 1344, or 1348, any rule or regulation of the Securities and Exchange Commission, or any provision of Federal law relating to fraud against shareholders.
- To encourage whistleblowing, employers are required to set up audit committees, which must have procedures for employees to confidentially and anonymously report "concerns regarding questionable accounting or auditing matters." Public L. No. 107-204 at Sec. 301, amending 15 U.S.C. Sec. 78f.
- ALJ Purcell found the complainant engaged in protected activity by:
- Alleging [to supervisors and external auditors] that two journal entries totaling $195,000 were improperly recorded with the effect of inflating Cardinal's reported income.
- Welch testified that he believed the entries were improper based on the instructions for the preparation of a quarterly call report submitted to the Federal Reserve, which is similar to Form 10-QSB (Tr. 52). According to those instructions, any recoveries must go directly to the allowance account (which is a balance sheet account), and loan losses and recoveries can never go directly against income.
- The third-quarter certification required Welch to ensure that Cardinal's quarterly report contained no "untrue statement of a material fact" and "fairly present[ed] in all material respects [its] financial condition" (CX 23 at 2). Welch could have reasonably believed he could not make the necessary certification because the entries in question resulted in a material misstatement of Cardinal's financial status.
- Alleging that his access to Respondent's external auditors was restricted.
- He stated that over the course of his tenure as Cardinal's CFO, "Larrowe & Co. has communicated primarily with Leon Moore on all issues" and "[o]ver the past year to year and a half, I have been excluded from your communications loop almost entirely," (CX 17; Tr. 358). He added that in light of the recent enactment of Sarbanes-Oxley, he "need[ed] a better level of comfort before signing a representation [letter] such as yours." Ibid. Similarly, in his September 13th memorandum to Moore, Welch stated that "you [ i.e., Leon Moore] . . . have been the (practically) exclusive contact with Larrowe & Company . . ." and cited this exclusion from communications as grounds for his inability to certify the adequacy of Cardinal's third-quarter certification (CX 23 at 2; Tr. 57; 23 at 5).
- Before Sarbanes-Oxley, an employee could just follow orders, stay quiet, and avoid both retaliation and prosecution. With Sarbanes-Oxley, following illegal orders and lead to jail. 18 USC 1348, 1519
- Welch's allegation that Cardinal had inadequate internal controls because too many individuals outside of the finance department were making journal entries without the CFO's review or knowledge.
- Welch had reasons to question the propriety of making credit entries to "sundry credits" and then reversing them the following year, which had the effect of overstating Cardinal's income (JX 2 at 7-8). *** Welch asserted that this practice was inconsistent with the GAAP which require "that income and expenses be matched against the period in which they are incurred" (Tr. 64-65). Respondent never denied this assertion. Welch further testified that this practice had "the appearance of manipulating income" or "pump[ing] up" earnings at mid-year, "which is a significant milestone for investors."
Cudahy, J., dissenting in Greenberg v. Kmetko, 840 F.2d 467, 477 (7th Cir. 1988) (en banc)
- What can an employee do to leave the umbrella, and lose protection?
- An employer may terminate an employee who behaves inappropriately, even if that behavior relates to a legitimate safety concern.
- Dunham v. Brock, 794 F.2d 1037, 1041 (5th Cir. 1986). In Dunham, the employee filed a safety report with the Nuclear Regulatory Commission. The employer suspected as much but also thought, legitimately, that the employee often acted in a disruptive and dominant manner. Id. at 1039. To address this problem, the employer held a counseling session with the employee. The employee swore at his employer and refused to change his behavior. He dared the employer to fire him. Holding for the employer, the court noted that an "otherwise protected 'provoked employee' is not automatically absolved from abusing his status and overstepping the defensible bounds of conduct." Id. at 1041. The employee's cavalier attitude, abusive language, and defiant conduct justified his discharge. Id. at 1040-41.
- See also Lockert v. United States Dep't of Labor, 867 F.2d 513, 519 (9th Cir. 1989) (employee's disobedience justified discharge, especially where he failed to establish disparate treatment or that he had made an unusually large or serious number of complaints).
- The Secretary of Labor has recognized that protected activity may be associated with "impulsive behavior." Employees cannot be disciplined for protected activity so long as it "is lawful and the character of the conduct is not indefensible in its context." A key inquiry is whether the employee has upset the balance that must be maintained between protected activity and ship discipline. Kenneway v. Matlack, Inc., No. 88-STA-20, D&O of SOL, at 6-7 (6-15-89).
- "Dissenters and whistleblowers rarely win popularity contests or Dale Carnegie awards. They are frequently irritating and unsettling. These qualities, however, do not necessarily make their views wrong or unhelpful, and the Supreme Court has concluded that it is in the public interest and consonant with the first amendment for them to express opinions on subjects of public concern without fear of retaliation."
- In Welch, ALJ Percell rejected a claim that Welch's insistence on the presence of his personal legal counsel at a management meeting justified his discharge.
- Complaints must have a nexus to the safety or environmental purpose of the statute.
- The broad scope of these environmental laws, and the judicial doctrines following the remedial purpose, make this area of protection an open field for creative pleading and advocacy. Indeed, practitioners upset with the lax enforcement of Section 11(C) of the Occupational Safety and Health Act may look to these federal environmental laws to protect workers who oppose unlawful handling of hazardous materials.
See e.g., Mackowiak v. University Nuclear Systems, Inc., 735 F.2d 1159, 1162 (9th Cir. 1984); DeFord v. Secretary of Labor, 700 F.2d 281, 286 (6th Cir. 1983) (NRC proceedings under the ERA or the Atomic Energy Act of 1954)
- Discrimination has many forms.
- The definition of discriminatory acts under 29 C.F.R. Part 24 is extremely broad.
- Without any question, an employee's discharge constitutes a cognizable harm under the environmental whistleblower statutes. WPCA and SDWA, cited above. Accord, 29 C.F.R. Sec. 24.2(a).
- Any difference in treatment distinguishes those who engaged in protected activity, and thereby discourages other employees from engaging in such activity. "Yellow stars" are prohibited.
- Bassett v. Niagara Mohawk Power Co., 86-ERA-2, D&O of SOL, p. 6 (July 9, 1986)(denial of parking privileges)
- Hill, et al. v. T.V.A., 87-ERA-23/24, D&O of SOL, p. 9 (May 24, 1989)(refusal to refer an employee for work)
- Flanagan v. Bechtel Power Corp., 81-ERA-7, D&O of SOL, p. 6-7 (June 27, 1986)(refusal to rehire)
- Jenkins v. EPA, 92-CAA-6, D&O of SOL pp. 14-15 (May 18, 1994) (reassignment to a less desirable position)
- Thomas v. APS, 89-ERA-19, D&O of SOL, p. 17 (September 17, 1993)(retaliatory harassment).
- A reprimand for failing to consult with a supervisor before blowing the whistle constitutes direct evidence of discriminatory motive. McMahan v. Calif. Water Quality Control Bd., 90-WPC-1, D&O of SOL, page 4 (July 16, 1993).
- Restraints on protected activities
- The Secretary of Labor (SOL) has determined that whistleblowers are entitled to protection from coercive settlement practice that impinge on a whistleblower's right to communicate his or her concerns to the NRC and other governmental agencies. This protection specifically applies to former employees who may seek to settle a Section 211 claim against a licensee. See The Connecticut Light & Power Co. v. Sec'y of U. S. Dep't. Of Labor, 85 F.3d 89, 91 (2d Cir. 1996) (upholding the decision of the SOL that "an employer's proffering of a settlement agreement containing provisions that would have restricted its employee's access to judicial and administrative agencies violated Section 210 of the Energy Reorganization Act of 1974 ("ERA"), 42 U.S.C. § 5851(a) (1988).").
- In cases under the National Labor Relations Act (NLRA), the Supreme Court has held that where conduct is "inherently discriminatory," the employer must be held to "consequences which forseeably and inescapably flow" from the conduct, even if there is no evidence of illegal or discriminatory intent. Radio Officers v. NLRB, 347 U.S. 17, 45; NLRB v. Erie Resister Corp., 373 U.S. 221, 228 (1963); see also Kroger Co. v. NLRB, 401 F.2d 682, 686 (6th Cir. 1968), cert denied, 395 U.S. 904 (1969). The SOL has applied this principle to "gag" orders contained in settlement agreements. Rudd v. Westinghouse Hanford Co., 88-ERA-33, D&O of Remand by ARB, 8 (Nov. 10, 1997) (employer engages in "unlawful discrimination by restricting complainant's ability to provide regulatory agencies with information; improper "gag" provision constituted adverse employment action"); Chase v. Buncombe County, NC, 85-SWD-4, D&O of Remand by SOL, 4 (Nov. 3, 1986) (SOL warns against upholding employer action that has a "chilling effect" or "discourages, rather than encourages, reporting of safety violations").
- The Department of Labor will not dismiss a case based on a settlement unless the ALJ or DOL have received the settlement agreement and approved it.
- Procedures for complaints
- Filing a complaint
- The complaint must be filed in writing. 29 CFR 24.3(c) states the form of the complaints as follows:
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 violation.
- Complaints must include the names and addresses of the employee (called the complainant) and the employer (called the respondent).
- Careful drafters will pay attention to identification of the responsible employer, and the names of individuals who have participated in the retaliation.
- An attorney or union representative may file the complaint on behalf of the employee, so long as it is with the employer's permission. 29 CFR 24.3(a).
- The complaint may be filed with any office of the Occupational Safety and Health Administration of the U.S. Department of Labor. My impression is that they prefer to receive complaints at the local office. You can find the address and fax number for the local OSHA office at http://www.osha.gov/oshdir/. The Administrator's office is at:
Occupational Safety & Health Administration
200 Constitution Ave NW, Rm N3647
Washington, DC 20210
Compliance Programs Fax: 202-219-9187
Complaints in Ohio may be addressed to:
Cincinnati Area Office
36 Triangle Park Drive
(513) 841-4114 FAX
Cleveland Area Office
Federal Office Building
1240 East 9th Street, Room 899
Cleveland, Ohio 44199
(216) 771-6148 FAX
Columbus Area Office
Federal Office Building
200 North High Street, Room 620
Columbus, Ohio 43215
(614) 469-6791 FAX
Toledo Area Office
Federal Office Building
234 North Summit Street, Room 734
Toledo, Ohio 43604
(419) 259-6355 FAX
- Time limits for Environmental Whistleblowers: 30 days
- 29 CFR 24.3(b)(1). The 30 day time limit may be met by the postmark of the complaint, or by fax transmission.
- In counting the 30 day limit, we do not get the benefit of Civil Rule 6(A). Thus, If the 30th day falls on a Sunday, the complaint must be postmarked or filed by that Sunday. A complaint filed on Monday will be dismissed as untimely.
- Equitable Tolling. Because the thirty day time limit is not jurisdictional, it may be subject to equitable tolling. Doyle v. Alabama Power Co., 87-ERA-43 (Sec'y Sept. 29, 1989), aff'd sub. nom. Doyle v. Secretary of Labor, No. 89-7863 (11th Cir. 1989). A tolling of the filing time limitation may be appropriate if:
- the respondent mislead the complainant concerning the cause of action (by fraudulently concealing its actions, see Hill v. U.S. Department of Labor, 65 F.3d 1331, 1335 (6th Cir. 1995));
- some extraordinary circumstance prevented a timely assertion (such as a stroke, see Central States, Southeast and Southwest Area Pension Fund v. Slotky, 956 F.2d 1369, 1376 (7th Cir. 1992)); or,
- the complainant timely raised the precise statutory claim but in the wrong forum. School District of City of Allentown v. Marshall, 657 F.2d 16, 20 (3d Cir. 1981).
- In regards to the last basis, the United States Supreme Court has held that utilization of collective bargaining grievance procedures does not justify tolling a statutory filing period. Electrical Workers v. Robbins & Myers, Inc. 429 U.S. 229 (1976), cited in Allentown, 657 F.2d at 19.
- In addition, if a complaint is filed in a wrong forum, it still must be accomplished within the required time frame. Allentown, 657 F.2d at 20, relying on Burnett v. New York Central Railroad, 380 U.S. 424 (1965).
- On the other hand, equitable tolling is not appropriate because a complaint may not have been aware of the specific time permitted under the statutes for filing a complaint. Allentown, 657 F.2d at 21 (ignorance of employee protection provisions of the Toxic Substance Control Act did not toll the filing time limit), and Kang v. Department of Veterans Affairs Medical Center, 92-ERA-31 (Sec'y Feb. 14, 1994).
The U.S. Court of Appeals for the Sixth Circuit utilizes a five part test that focuses on lack of actual or constructive knowledge of the filing requirements, diligence, prejudice to the opposing party, and reasonableness of the ignorance of the law; although, ignorance of the law alone is not sufficient to warrant equitable tolling. Andrew v. Orr, 851 F.2d 146, 151 (6th Cir. 1988). The Secretary has indicated that the Andrew analysis should be applied in cases arising in the Sixth Circuit. Rainey v. Wayne State University, 89-ERA-8 (Sec'y May 9, 1991). In cases outside the Sixth Circuit, the Secretary has applied the framework in used by U.S. Court of Appeals for the Third Circuit. See Doyle v. Alabama Power Co., 87-ERA-43 (Sec'y Sept. 29, 1989) [citing School District of the City of Allentown, 657 F.2d 16 (3d Cir. 1981)] , aff'd sub. nom. Doyle v. Secretary of Labor, No. 89-7863 (11th Cir. 1989).
- Continuing Violation. An equitable exception to the thirty day time limit occurs if the complainant is subjected to either a continuing violation or a systematic pattern of discrimination. The justification for this exception is the adverse employment practice becomes apparent only with the passage of time. Paraphrasing the court in Malhotra v. Cotter & Co., 885 F.2d 1305, 1310 (7th Cir. 1991), it would be unreasonable to require a complainant to realize he or she is a victim of discrimination if such discrimination doesn't become apparent until a pattern of discriminatory mistreatment develops. If a continuing violation situation exists and the complaint is filed within thirty days of the last act in the continuing series of events, then that one non-time barred act can save the other previous acts which are time barred. Varnadore v. Secretary of Labor, 141 F.3d 625 (6th Cir. 1998) (case below 92-CAA-2 et al.). In addition, a systematic, or company-wide, pattern of discrimination may also toll the time limit on the same continuing violation basis. To obtain equitable relief under on this theory, a complainant would have to establish the respondent's policy of discrimination against a group of employees. Green v. Los Angeles Cty. Superintendent of Sch., 883 F.2d 1472, 1480- 1481 (9th Cir. 1989). See also Berry v. Bd. of Supervisors of LSU, 715 F.2d 971, 979 (5th Cir. 1983), cert. denied, 479 U.S. 868 (1986).
- State law claims may be as short as ten (10) days (Ohio civil service appeals to the State Personnel Board of Review), 180 days (O.R.C. 4113.52), or two years (42 U.S.C. 1983 claims against those acting under color of state law).
- Sarbanes-Oxley and AIR 21: 90 days
- Sarbanes-Oxley: 18 USC 1514A(b)(2)(D)
- AIR 21: 49 USC 42121(b)(1)(a)
- Nuclear Whistleblowers and Surface Transportation: 180 days
- Nuclear: 24 CFR 24.3(b)(2)
- STA: 42 USC 31105(b)(1)
- Investigation, hearing, and appeals
- DOL whistleblower proceedings are like a combination of unemployment and EEOC proceedings, in which discovery is available before the hearing. OSHA makes the initial investigation and decision. They interview witnesses on both sides and prompt the parties to discuss settlement, like EEOC proceedings (when the investigator has time). I expect that the claimant will normally lose credibility disputes at this level, just like unemployment hearings. The initial decision is made in a couple of months, but can stretch to the better part of a year or more.
- In nuclear, mining and Sarbanes-Oxley cases, preliminary orders are available. They can require reinstatement as soon as unlawful retaliation is found:
- ERA [nuclear whistleblowers], 42 U.S.C. Section 5851(b)(2)(A); 29 C.F.R. § 24.7(c)(2), provide for preliminary orders after ALJ hearing.
- Sarbanes-Oxley, 29 CFR 1980.105 [preliminary orders of reinstatement are not stayed by requesting a hearing, 29 CFR 1980.106(b)(1)]
- Jonathan Ben-Asher and Rebecca Houlding Beranbaum note: The regulations [29 CFR 1979.104(d) and (e)] imply that DOL may order preliminary reinstatement prior to issuing its findings and preliminary order, but do not appear to provide a mechanism for actually doing so until the findings and preliminary order are promulgated. See 29 CFR 1979.104(e) and 29 CFR 1979.105.
- Once OSHA issues a decision in an environmental case, the loser must file a request for a hearing within five (5) days (even if the OSHA determination says 30 days) of receiving the decision. 29 CFR 24.4(d)(2). Copies must be filed with the Chief Administrative Law Judge and the Administrator, and must be sent to the respondent and the Associate Solicitor, Division of FLS, USDOL, Washington, DC 20210. Upon filing the request for a hearing, discovery commences. See 29 CFR 18.06 to 18.24.
- The address and telephone numbers of the Chief Administrative Law Judge are as follows:
Chief Administrative Law Judge
U.S. Department of Labor
800 K Street, NW, Suite 400 North
Washington, D.C. 20001-8002
Voice: (202) 693-7300
By fax to: (202) 693-7365
- As a courtesy, enclose a copy of the OSHA decision for identification.
- Sarbanes-Oxley and STAA provide 30 days to request a hearing. 29 CFR 1980.106(a) (SOX)
- Complainants have a right to a speedy hearing, meaning ninety (90) days from filing the complaint. 29 CFR 24.6(b)(1). They can waive this right to complete discovery, for example. The respondent does not have standing to object to or insist upon a continuance. Holub v. H. Nash Babcock, Babcock & King, Inc., 93-ERA-25, ALJ Order Denying Respondent's Motion for an Immediate Hearing (June 24, 1993).
- Appeals from the ALJ RD&O
- ALJ Recommended Decisions and Orders (RD&Os) can be appeals to the Administrative Review Board (ARB), a three member panel appointed by the Secretary of Labor (SOL).
- Under regulations amended effective 3/11/98, the petition for review must be received by the ARB within 10 business days after the ALJ issues a recommended decision. 29 CFR 24.8. The petition for review can be filed by fax at 202-219-9315. For voice assistance, call 202-219-4728. For AIR 21 cases, the petition for review must specify the orders, conclusions and findings for which review is sought. Errors not listed in the petition for review will be waived. 29 CFR § 1979.110(a).
- This new panel replaces the SOL's role under the regulations.
- Final decisions of the ARB are reviewable by petition to federal Circuit Courts of Appeals.
- Sarbanes-Oxley incorporates the procedure of AIR 21. 18 USC 1514A(b)(2)(A).
- AIR 21 provides 60 days to file the petition for review from an adverse ARB decision. 49 U.S.C. § 42121(b)(4)(A).
- Direct civil action
- Sarbanes-Oxley: If DOL does not issue a final decision within 180 days, the employee can bring an action for de novo review. 18 U.S.C. Sec. 1514A(b)(1)(B).
- An employee cannot sue in federal court if his own bad faith caused DOL's delay.
- Sarbanes-Oxley does not diminish any other rights the employee may have. 18 USC 1514A(d).
- Other whistleblowers may be able to assert independent claims based on the same facts. See, for example, Charvat v. Eastern Ohio Regional Wastewater Auth., 246 F.3d 607 (6th Cir. 2001) (Section 1983 action permitted after favorable DOL ALJ decision).
- Elements of the claim
- A complainant must show, by a preponderance of evidence, the following elements of a case of discrimination under the environmental employee protection statutes:
- the party charged with discrimination was an employer under the act(s);
- the complainant was an employee under the act(s);
- Here, too, a broad interpretation of "employee" is necessary in order to give full effect to the purpose of section 6791(a), which is to encourage the reporting of violations of solid waste disposal requirements by prohibiting discrimination arising out of the employment relationship. Protecting the reporting employee against retaliation only while that employee is in the employ of the violator has a "chilling effect" and discourages, rather than encourages, the reporting of safety violations. For the foregoing reasons, I conclude that section 6971(a) of the SWDA may apply to former employees as well as to current employees of covered employers. Chase v. Buncombe County, NC (Sec'y 9-30-83), 85-SWD-4, D&O of remand
- Independent contractors can be covered. Samodurov v. General Physics Corp., 89-ERA-20, D&O of SOL, pp. 5-7 (11-16-93).
- the complaining employee was discharged or otherwise discriminated against with respect to his or her compensation, terms, conditions or privileges of employment;
- Adverse actions, see section V above, page 11.
- the employer knew or believed that the employee engaged in protected activity;
- Boilerplate language of a prima facie case often requires proof that the employee engaged in protected activity. But what if the employer mistakenly believed the employee had engaged in protected activity? Is the retaliation without a remedy? Is employer belief in the employee's protected activity sufficient? If someone fingers a mole, must they be right?
- Indeed, it is incorrect to say that a prima facie case of retaliation requires a showing of protected activity at all. An employer subjected to a law enforcement investigation might mistakenly retaliate against an employee who engaged in no protected activity. That employee is still protected from "discrimination" on account of identification, albeit mistaken, as a whistleblower. Reich v. Hoy Shoe, Inc., 32 F.3d 361, 368 (8th Cir. 1994); Brock v. Richardson, 812 F.2d 121, 123-25 (3d Cir. 1987).
- But see Sarbanes-Oxley and AIR 21 regulations, 29 CFR 1980.104(b)(1)(i), 29 CFR 1979.104(b)(1)(i) requiring evidence that "employee engaged in a protected activity or conduct."
- the retaliation against the employee was motivated, at least in part, by the employee's engaging in protected activity.
In environmental whistleblower cases, the complainant has an initial burden of proof to make a prima facie case by showing (1) the complainant engaged in a protected activity; (2) the complainant was subjected to adverse action; and, (3) the evidence is sufficient to raise a reasonable inference that the protected activity was the likely reason for the adverse action. Zinn v. University of Missouri, 93-ERA-34 and 36 (Sec'y Jan. 18, 1996), and Passaic Valley Sewerage Comm'rs v. Department of Labor, 992 F.2d 474 (3rd Cir. 1993).
Essentially, the Secretary has broadly defined a protected activity as a report of an act which the complainant reasonably believes is a violation of the environmental acts. While it doesn't matter whether the allegation is ultimately substantiated, the complaint must be "grounded in conditions constituting reasonably perceived violations of the environmental acts." Minard v. Nerco Delamar Co., 92-SWD-1 (Sec'y Jan. 25, 1995), slip op. at 8. In other words, the standard involves an objective assessment. The subjective belief of the complaint is not sufficient. Kesterson v. Y-12 Nuclear Weapons Plant, 95-CAA-12 (ARB Apr. 8, 1997). In the Minard case, the Secretary indicated the complainant must have reasonable belief that the substance is hazardous and regulated under an environmental law. Consequently, the complainant's concern must at least "touch on" the environment. Nathaniel v Westinghouse Hanford Co., 91- SWD-2 (Sec'y Feb. 1, 1995), slip op. at 8-9; and, Dodd v. Polysar Latex, 88-SWD-4 (Sec'y Sept. 22, 1994).
To prevail on the third element of the prima facie case, a complainant only needs to establish a reasonable inference that his or her protected activity lead to, or caused, the respondent's adverse action. This burden to show an inference of unlawful discrimination is not onerous. McMahan v. California Water Quality Control Board, San Diego Region, 90-WPC-1 (Sec'y Jul. 16, 1993). At this point of the process, the complainant need only present evidence sufficient to prevail until contradicted and overcome by other evidence. Jackson v. The Comfort Inn, Downtown, 93-CAA-7 (Sec'y Mar. 16, 1995), citing Carroll v. Bechtel Power Corp., 91-ERA-46 (Sec'y Feb. 15, 1995), slip op. at 11.
- Methods of proving retaliation
- An employee's claim of retaliatory discharge can be established two ways: either by direct evidence, or by a McDonnell analysis of a prima facie case. McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1973).
- Employers and supervisors rarely admit to a discriminatory or retaliatory motive. Accordingly, the Secretary of Labor has held that the presence of a retaliatory motive usually must be proved by circumstantial evidence and the inferences drawn there from. Richter v. Baldwin Associates, No. 84-ERA-9-12, D&O of remand by SOL, slip op. at 13-14 (March 12, 1986).
- The presence or absence of retaliatory motive is a legal conclusion and is provable by circumstantial evidence even if there is testimony to the contrary by witnesses who perceived lack of such improper motive. Ellis-Fischel State Cancer Hosp. v. Marshall, 629 F.2d 563, 566 (8th Cir. 1980), cert. denied, 450 U.S. 1040 (1981).
- When direct evidence of retaliation exists in the record, it short circuits the more common analysis of the shifting burden of proof. It obviates the need for a prima facie case as described in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1973). Trans World Airlines v. Thurston, 469 U.S. 111, 121 (1985).
- Direct evidence, if credited by the fact finder, removes the case from McDonnell analysis because the complainant no longer needs the inference of discrimination that arises from the prima facie case. Talley v. Bravo Pitino Restaurant, Ltd., 61 F.3d 1241, 1248 (6th Cir. 1995).
- Proof of animus towards the employee and his or her protected activity is sufficient by itself to demonstrate discriminatory motive. See, e.g., American Jurisprudence (2nd), Proof of Facts, "Proof of Retaliatory Termination," Section 7-1; Hedden v. Conam Inspection Co., Case No. 82-ERA-3, slip op. of ALJ at pp. 4; Cram v. Pullman-Higgins Co., Case No. 84-ERA-17,slip op. of ALJ at p. 16; Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) (remarks based on gender stereotypes may prove discriminatory intent)
- See, e.g. Pillow v. Bechtel Constructions, Inc., 87-ERA-35, D&O of Remand, p. 13 (July 19, 1993) (foreman's anger at employee because he raised safety concern is direct evidence of discriminatory animus); Blake v. Hatfield Electric Co., 87-ERA-4, R. D&O of ALJ, p. 22 (Aug. 13, 1987), affirmed by SOL (January 22, 1991) (allegations of "disloyalty" for engaging in protected activity constitutes direct evidence of discriminatory motive); Thomas v. APS, 89-ERA-19, R. D&O of ALJ, p.8 (April 13, 1989), affirmed by SOL (September 17, 1993) (employer anger over protected activity).
- The timing alone of an employer's allegedly retaliatory action is sufficient to establish circumstantial evidence of an employer's improper motive. Couty v. Dole, 886 F.2d 147, 148 (8th Cir. 1989); Jackson v. Ketchikan Pulp Co., 93-WPC-7 and 8 (Sec'y Mar. 4, 1996). The SOL has found that when an employee's protected activity was followed within six months (Helmstetter v. Pacific Gas & Elec., 86-SWD-2, D&O of SOL, p. 6 (September 9, 1992)), or even a year (Thomas v. APS, Case No. 89-ERA-19, RD&O of ALJ at 8 (April 13, 1989)) by disciplinary action, the timing of the two events was sufficiently close to establish a nexus between the protected activity and the adverse action, and sufficient circumstantial evidence of discriminatory motive.
- An employer's failure to "follow its normal procedures" can also evidence discriminatory motive. Johnson v. Old Dominion Security, 86-CAA-3/4/5, D&O of SOL, p. 18 (May 29, 1991).
- The use of false evidence reveals knowledge that the party cannot win with the truth. Martin v. Norris, 82 F.3d 211, 216 (8th Cir. 1996). See also Favors v. Fisher, 13 F.3d 1235, 1239 (8th Cir. 1994) (unlawful destruction of documents in a race discrimination suit entitles the plaintiff to a presumption that the suppressed evidence would have bolstered her case)
Resort to a pretextual explanation is, like flight from a scene of the crime, evidence of consciousness of guilt, which is, of course, evidence of illegal conduct.
Sheridan v. DuPont, 100 F.3d 1061, 1069 (3d Cir. 1996), quoting Binder v. Long Island Lighting Co., 57 F.3d 193, 200 (2d Cir. 1995).
- In Welch, ALJ Purcell made the adverse inference based on timing (two weeks), employer use of false claims, and animus in mandatory language directing Welch to certify a financial report.
- Reinstatement, back pay and benefits, lost overtime, and other actual damages to make the victim whole.
- Reinstatement and compensation for all lost wages and incidental damages incurred due to the termination of employment. Restoration of all benefits and all terms and privileges of employment. 29 C.F.R. Sec. 24.6(b)(2). All seven environmental whistleblower statutes require reinstatement as a remedy. The regulation implementing six of the laws (not ERA) reinforces the mandatory nature of this remedy:
If the Secretary concludes that the party charged has violated the law, the final order shall order the party charged to take appropriate affirmative action to abate the violation, including reinstatement of the complainant to that person's former position or substantially equivalent position . . .
29 C.F.R. § 24.6(b)(2) (emphasis added).
- The ERA and Sarbanes-Oxley are even stronger in imposing reinstatement upon the Administrative Law Judge's decision.
- Sarbanes-Oxley requires reinstatement at 18 USC 1514A(c)(2)(A).
- "Front pay" may be negotiated in place of reinstatement, but reinstatement must be ordered upon a finding of wrongful discharge.
- Complainants have a duty to mitigate damages, for example, by looking for substitute employment.
- Compensation for mental anguish, pain and suffering, harassment, lost future earnings and loss of professional reputation. Pillow v. Bechtel Constructions, Inc., 87-ERA-35, D&O of Remand, (July 19, 1993); DeFord v. Secretary of Labor, 700 F.2d 281, 288 (6th Cir. 1983); Simmons v. Florida Power Corp., 89-ERA-28/29 RD&O, p. 18 (December 13, 1989). English v. Whitfield, 868 F.2d 957 (4th Cir. 1988) (compensation for harassment).
- In the case of Marcus v. U.S. EPA, 92-TSC-5, R. D&O of ALJ, pp. 29-30, adopted by SOL (February 7, 1994), the ALJ and SOL awarded $50,000.00 in emotional distress damages. In Marcus, the Complainant never sought psychological counseling and did not call an expert witness in this area. The award was based on the Complainant's testimony regarding the disruption to his "home life", his "depression" and other matters which caused Dr. Marcus to suffer "mental and physical anguish" and a loss of professional reputation. Marcus, ALJ R. D&O pp. 29-30.
- Exemplary damages are available under the Safe Drinking Water Act (SDWA), 42 U.S.C. 300j-9(i)(2)(B)(ii), and the Toxic Substances Control Act (TSCA), 15 U.S.C. 2622(b)(2)(B).
- Purpose is deterrence.
- In order to effectively deter others, however, exemplary damages must be large enough to hurt the offender. United States v. ITT Continental Baking Company, 420 U.S. 223, 231-232(1975); United States v. J. B. Williams, 498 F. 2d 414, 438 (2nd Cir. 1974); United States v. Swingline, Inc., 371 F. Supp. 37, 47 (E.D.N.Y. 1974); State ex rel. Brown v. Dayton Malleable, 1 Ohio St.3d 151 (1982), affirming trial court decision at 10 Envtl. L. Rep. 20,677, 13 ERC 2189. The penalty cannot be disregarded as a mere cost of doing business. U.S. v. ITT Continental Baking Co., supra. To deter future misconduct, the penalty must be more than a "slap on the wrist." U. S. v. J.B. Williams, supra.
- Exemplary damages are not tax deductible.
- Interest on the back pay and benefits continuing to the date of reinstatement at the rate continuously then in effect under 26 U.S.C. 6621(a)(2), the underpayment rate. See, e.g., Clinchfield Coal Co. v. Federal Mine Safety and Health Comm'n, 895 F.2d 773, 778-780 (D.C. Cir. 1990); 26 CFR 301.6621-1(a)(3) (rate compounded daily). The IRS most recently established these rates in Rev. Rul. 97-53, published in Internal Revenue Bulletin 1997-52, pp. 13-15.
- An order that respondent take all reasonable "affirmative action" to abate discrimination which may discourage employees from raising concerns. Require Respondent to officially inform all employees of their right to contact the EPA and AG. Chase v. Buncombe County, N.C., 85-SWD-4, p. 4, (November 3, 1986).
- Sealing of documents and an expungement of all negative information. Chase v. Buncombe County, N.C., 85-SWD-4, p. 6 (November 3, 1986).
- Require that the ALJ D&O be prominently posted. Simmons v. Florida Power Corp., 89-ERA-28/29, p. 22, (December 13, 1989).
- All attorney's fees and costs. 29 C.F.R. 24.6(b)(3).
- Sarbanes-Oxley's attorney fee proviso is at 18 USC 1514A(c)(2)(C)
- Sarbanes-Oxley criminal retaliation
- Sarbanes-Oxley criminalizes retaliation against whistleblowers. These penalties apply even if the object of retaliation is not an employee. 18 U.S.C. Sec. 1513(e).
- Other sources of information
- Workplace Fairness has a nice collection of web pages on the rights of whistleblowers. It starts at:
- A good source of information is Concepts and Procedures in Whistleblower Law by Stephen M. Kohn. It is available from the National Whistleblower Center for $102.50, 3238 P St., NW, P.O. Box 3768, Washington, DC 20027, 202-342-1902.
- The National Whistleblower Center also publishes Federal Whistleblower Laws and Regulations,
- The National Whistleblower Center page on Sarbanes-Oxley is at: http://www.whistleblowers.org/html/corporate_whistleblowers.htm
- Whistleblower Protections under Sarbanes-Oxley, Jonathan Ben-Asher and Rebecca Houlding Beranbaum, Menken & Ben-Asher LLP; American Bar Association, Section of Labor and Employment Law, Committee on Employment Rights and Responsibilities, Mid-Winter Meeting - March, 2003
- National Employment Lawyers Association
- Researchers can access OALJ decisions in an excellent database at http://www.oalj.dol.gov/libwhist.htm or
- Sixth Circuit cases
- See: ANR v. US DOL at: