DATE JAN 22 1982
CASE NO. 82-ERA-3

IN THE MATTER OF

JOHN J. HEDDEN, III
    Complainant

    v.

CONAM INSPECTION
    Respondent

Bruce L. Hudson, Esq.
    For the Complainant

John J. Cleary, Esq.
    For the Respondent

BEFORE: CHARLES P. RIPPEY
    Administrative Law Judge

The complainant, John Hedden, seeks reinstatement to his position, compensation for lost wages, payment of medical expenses, and compensation for pain and suffering under the Energy

Reorganization Act of 1974, as amended, (hereinafter referred to as the Act) 42 U.S.C. § 5851 and its implementing regulations found at Title 29 Code of Federal Regulations Part 24. The complainant alleges that Conam Inspection, the employer, discharged the complainant due to his participation with a Nuclear Regulatory Commission (hereinafter NRC) audit and inspection of the employer.

On November 24, 1981 following an investigation of the complaint, the Administrator of the Wage and Hour Division, Employment Standards Administration, United States Department of Labor concluded that the requisite discrimination was not a factor in the discharge of the complainant. Following that decision the complainant requested a hearing.

A hearing was held in Wilmington, Delaware on December 17, 1981 at which all parties were present and represented by counsel. This was a de novo hearing and therefore by its terms not a review of the earlier decision by the Wage and Hour Division. That investigation and its results cannot be given weight in this decision.

The complainant began work for the employer as a radiation technician. Thereafter he was promoted to laboratory supervisor which position he held until September 14, 1981. Prior to the NRC audit the complainant's supervisor, Andrew Prohn conferred with the complainant in regard to the NRC inspection. During that conference Mr. Prohn directed the complainant not to offer anything when being questioned by the NRC. Mr. Prohn's attempt to explain that he was only suggesting that employees should not throw the investigator off the track is not credible. On this subject, I accept the testimony of the complainant. Prior to this conference the complainant had informed Mr. Prohn of several violations of the NRC regulations including the falsification of the qualifications of certain persons to handle radioisotopes, and had disavowed any responsibility for the falsifications.

During the NRC audit, the complainant was interviewed and volunteered the information regarding the violations, including the aforesaid falsifications.

While the NRC has not issued its final findings, sanctions for the violations could include revocation of the license from the NRC under which the employer operates. The employer was informed

of the immediate information gathered by the NRC investigation. Several of the items noted by the NRC were the same as those that had been brought to the employer's attention by the complainant, including the aforesaid falsifications. Following the NRC investigation on the Friday before the complainant was to begin his vacation, he was told that he no longer would act as group leader and that he could begin his vacation early. The complainant left and on the second week of his vacation he contacted the employer. Mr. Prohn informed the complainant that he had been discharged for having made unauthorized purchases. The complainant then initiated a complaint that his discharge was because of his cooperation with the NRC and in violation of § 5851 of the Act.

Section 5851 of the Act provides that no employer may discharge or otherwise discriminate against any employee who, among other things, assists or participates in a proceeding or any other action for the administration or enforcement or for carrying out the purposes of the Atomic Energy Act of 1954. The NRC's inspection of the employer immediately prior to the complainant's discharge was an activity of the type described in § 5851. This fact has not been contested by the employer.

The complainant contends that he was discharged because of his cooperation in the NRC audit. The reason for the employer's discharge of the complainant is the primary contested issue in this matter.

By letter dated September 17, 1981 (C-6) the complainant's supervisor Andrew Prohn officially notified the complainant of his termination, and stated therein that the complainant made two unauthorized purchases, which items do not pertain to the employer's operation. The letter asserts that these purchases were in violation of company rule 4 concerning dishonesty. The two items in question were a stereo headphone coil cable (R-1) and a LED alarm clock. The cost of the two items was $22.94( C-7, 8). Mr. Prohn learned of the purchase of the wire while on a business trip in St. Louis. In contrast to the normal routine of a monthly review of all receipts for purchases by employees conducted by Mr. Prohn, his secretary had upon seeing the receipt of a purchase by the complainant made an inquiry amongst an undetermined number of employees as to whether there was a work use for stereo headphone cable. She then telephoned Mr. Prohn and informed him of the purchase. Mr. Prohn stated that he decided then and

there in St. Louis to discharge the complainant. He later contacted the Personnel Department in order to clear the language used in the letter discharging the complainant. At no time did Mr. Prohn inquire of the complainant or other employees as to the possible uses of the items purchased although he admitted that he was not sufficiently familiar with electronics and the technical aspects of the work to determine whether the cable had uses other than with stereo headphones, and that he never examined the clock to ascertain if it could be utilized at work. At the hearing the complainant could not remember the particular purpose of this cable however he stated that the cable could be used at work. The complainant stated that the importance of the cable was not its name, i.e., stereo headphone cable rather it was the cable's electrical characteristics together with the fact that it was coiled. He indicated that for use at work he would clip off the jacks at each end and because the cable was coiled it would be able to expand and contract without using the space of or causing the tangles of straight wire. The complainant testified that many wires were purchased for work and although he did not remember the specific purpose of this wire, he believed it was used to connect the moving portion of a testing apparatus to its base.

As to the LED alarm clock, the complainant intended to use the clock in the dark room at work. The complainant made this $14.95 purchase in the hopes that it would be able to perform adequately and thereby result in considerable savings to the employer since the standard darkroom clock cost approximately $60. The complainant tested the clock, which had a stopwatch capability, in the darkroom and found it more than satisfactory. The complainant kept the clock in his file cabinet at work as a precaution against theft by other employees.

The complainant's credible testimony was that at no time were the two items either intended for or used at his home.

It is noteworthy that Mr. Prohn never had questioned any of the purchases made previously by the complainant although the employer conceeds many of those other purchases involved items that could be used either at home or work. Mr. Prohn also acknowledged that the complainant not only had authorization to make purchases at Radio Shack and other stores but that there were no guidelines as to what to purchase other than common sense. Moreover, up to the time of the hearing Mr. Prohn has not inquired of the complainant as to the whereabouts of the items

nor checked to see if the items were at the worksite.

In fact it remains unclear from the testimony as to whether the clock is or is not on the employer's premises. Even if the clock was now found to be missing no inference with regard to the complainant could reasonably be drawn therefrom in view of the testimony regarding the common occurrence of theft by employees in general.

Yet Mr. Prohn also acknowledges that the complainant was an excellent employee who had been given more responsibility and more pay. The complainant also stated that he had a good working relationship with Mr. Prohn prior to the NRC audit. The performance evaluations of the complainant completed by Mr. Prohn and the delegation of authority to the complainant by Mr. Prohn firmly establish Mr. Prohn's high regard for the complainant prior to the NRC audit. (C-2-4). In view of the above it is unreasonable to accept that Mr. Prohn fired the complainant for having purchased two items totalling $22.94 without even asking the complainant for what purposes the items were to be used.

The complainant testified to the attitudinal change in Mr. Prohn with regard to the complainant following the NRC audit. it should also be noted that the NRC informed Mr. Prohn of their preliminary findings including the aforesaid falsifications which had been discussed by the complainant with Mr. Prohn prior to the

NRC audit. And Mr. Prohn had informed the President of the company that the complainant had spent a lot of time with the NRC investigator. Based on the above, I find that the employer was aware that the complainant volunteered information about these violations to the NRC contrary to Mr. Prohn's instructions to not offer anything and that this was the cause of the complainant's discharge by the employer. The theft asserted by the employer was a poorly executed attempt to conceal the fact that it wanted to get rid of the complainant because he revealed embarrassing facts regarding its operation to the NRC.

The alleged unauthorized purchase of property simply does not stand up as the reason for discharge. The complainant's testimony regarding the business use of the property in question is credible in view of the responsibilities he had as supervisor of the laboratory and his explanation of its operation. The employer never inquired, let alone investigated, the use to which

the property had been put. The casual questions put by Mr. Prohn's secretary are totally inadequate. She had no technical training or capacity to make such an investigation. When the purported reasons for discharge evaporate, the only basis for discharge remaining is the employer's annoyance and embarrassment arising out of the disclosures made by the complainant to the NRC which are serious enough to perhaps call into question the continuation of the license which the employer has from the NRC to use radioisotopes. Direct evidence is lacking in this case, which is not surprising, but the only reasonable inference to be made from all of the evidence in this case is that the complainant was discharged by the employer because he made revelations to the NRC investigator regarding the company's operations.

There was evidence that the complainant had acted guiltily by destroying one of the receipts for either the wire or the clock which the employer required to be turned in. The complainant knew that the employer received another copy through the mail, and, thus, destroying the receipt would in no way conceal the purchase. The evidence does not support a finding that the complainant destroyed the receipt with any intent to conceal the purchase.

The employer sought to establish that the complainant had admitted his guilt in a telephone conversation after he was discharged when he supposedly said that it was a terrible mistake. I find that the evidence on this point is ambiguous and he could just as well have been referring to a terrible mistake having been made by the employer. The evidence, in my view, does not support a finding that the complainant made any admission that he was guilty of theft.

Havng established the violation of the Act by the employer, § 24.6(b)(2) of the regulations provides that appropriate affirmative action is to be taken in order to abate the violation.

The spreading of information that the complainant had been fired for dishonesty would almost certainly totally destroy the complainant's career. Therefore the employer is required to take all reasonable steps as outlined in the order below to erase the effect upon the complainant's career of its ungrounded assertion of dishonesty and wrongful conversion of properly. In cases such as this the spread of damaging assertions can never be fully

eradicated by later corrections. That the complainant's reputation and thus his career have been irreparably damaged is certain. The degree of that damage is difficult to assess, but the award in this case is intended to compensate him for that loss as well as his mental suffering.

The complainant also is entitled to reinstatement to his former position as a technician with the employer and to back pay from September 14, 1981 the date of discharge, until the actual date of reinstatement. The amount of back pay shall include payment for vacation time that was earned and that which would have been earned had the discharge not occurred. At the time of the discharge the complainant was making $320 per week which figure shall be used for determining back pay together with any periodic raises to which he would have been entitled if he had not been discharged.

Section 24.6(b)(2) provides for the awarding of compensatory damages in addition to the reinstatement, back pay and affirmative action provisions. In this instance the complainant seeks the payment of his psychiatric treatment and other medical expenses that have arisen as a result of the employer's actions as well as a $5,000 award for pain and suffering.

With regard to the medical expenses the complainant has testified to his psychiatric treatment due to this incident. In a post- hearing submission offered by the complainant of which the employer was given a copy, Dr. A. Rogers, the complainant's treating psychiatrist, relates complainant's disorder to the loss of his job with the employer and concludes that the condition will remit when the stressor ceases. Presumbly the sress will cease with this decision as will the need for psychiatric treatment that stems from this incident. The employer will be liable for three additional visits, if utilized, in which the complainant is afforded a necessary opportunity to be counseled with regard to this resolution of the matter and its effects upon him.

The employer objects to an award for pain and suffering. Compensatory damages however, are those necessary to make a wronged party whole and no more. Thus if the complainant experienced emotional pain and suffering he is entitled to be compensated for those losses under the Act.

The complainant has testified to being nervous and upset to the point where he has been unable to study, work or otherwise function at home. A brief review demonstrates that he has suffered a great deal of emotional pain. The complainant repeatedly stated that he loved his work with the employer and took a great deal of pride in his accomplishments and responsiblilty there. This was confirmed by the employer's evidence. Moreover the complainant believed there was a close relationship between Mr. Prohn and himself prior to the audit. When this same employer discharges this young man becaus of his honesty and integrity and employs the methods used here, there can be no doubt as to the extensive demoralization and emotional suffering inflicted upon this complainant.

It has been established therefore that the complainant's modest request of $5,000 is an appropriate and reasonable amount for compensation for his emotional pain and suffering that arose out of this incident and, as discussed above, for the damage to his reputation and career. This award is not to be construed as punitive or exemplary damages. There is no basis for such damages under the Act or regulations as the employer correctly points out.

Section 24.6(b)(3) provides for the assessment of attorney's fees against the employer. Counsel for the complainant submits an itemization of the services rendered and requests a fee in the amount of 1/3 the total award.

Counsel for the employer calls attention to several of the entries listed and objects to the contingent fee arrangement. The questioned entries concern telephonic communications with this Office. Those conversations dealt with the issuance of subpoenas and the complainant's request for a continuance and are therefore properly listed as services for which a fee should be awarded. As to the contingent fee arrangement there is no prohibition of such an arrangement nor does this arrangement appear unreasonable. Assuming $8,760, for back pay for a period of 18 weeks from September 14, 1981 and if reinstatment occurs as of January 18, 1982 at $320 per week (assuming no incremental raises due), plus $5,000 for pain and suffering, plus $866.65, the total medical expenses at present, the contingent fee would be 1/3 of that total of $14,626.65 or $4,875.55. That represents an approximate hourly rate of $180 which rate would be reasonable considering the metropolitan location of counsel's practice and

the risk factor entailed when working on a contingent fee basis.

It is hereby recommended that the Secretary issue an order in this matter as follows:

Conam Inspection is hereby ordered to:

1. Reinstate the complainant to his former position as radiation technician forthwith.

2. Pay to the complainant back pay in the amount of $320 per week, which amount is to be adjusted for any increases due, from September 14, 1981, until the date of reinstatement together with a sum representing earned vacation time owed to the complainant.

3. Pay to the complainant or to the provider of services for all medical expenses arising out of this incident. The liability for psychiatric care terminates following the date of the third additional psychiatric visit following the issuance of this decision.

4. Pay to the complainant the amount of $5,000 for his pain and suffering experienced as a result of this incident and for damage to his reputation and career.

5. Ensure that in all references to the discharge it is made clear that the complainant was discharged because of his cooperation with the Nuclear Regulatory Commission, that the discharge was found to be unlawful by the Secretary of Labor, and that the reasons given by the company suggesting that the complainant was in any way dishonest or engaged in any theft or other improper or illegal conduct were found after full hearing to have no basis whatsoever.

6. Pay in addition to the amounts ordered in paragraph 2-4 to Bruce W. Hudson for his representation services an amount equal to 1/3 of the total award to the complainant in paragraphs 2-4.

       CHARLES P. RIPPEY
       Administrative Law Judge