Date: January 26, 1996
CASE NO.: 89-ERA-23
In the Matter of:
NOAH JERRY ARTRIP,
Complainant,
v.
ESICORP, INC., formerly known
as EBASCO SERVICES, INC.,
Respondent.
Appearances:
BILLIE PIRNER GARDE, ESQ.
230 North Morrison
Appleton, WI 54911
On behalf of the Complainant
RAYMOND L. KALMANS
1700 West Loop South
Suite 1400
Houston, Texas 77027
On behalf of the Respondent.
Before: Hon. Richard D. Mills
Administrative Law Judge
RECOMMENDED DECISION AND ORDER ON DAMAGES
The case before me on remand from the Secretary of Labor
arises under the employee protection provision of the Energy
Reorganization Act of 1974, as amended (hereinafter ERA or the
"Act"), 42 U.S.C. 5851 (1988). In his Decision and Order of
Remand, the Secretary directed a hearing on the issue of damages,
which in this case encompasses back pay, compensatory damages,
[PAGE 2]
attorney's fees, and expenses. The hearing took place on June
27, 1995, in Houston, Texas.[1]
ISSUES
1. A determination as to the period of time for which a back pay
award should be calculated;
2. Whether Complainant is entitled to compensatory damages, and
if so, the amount of those damages;
3. Whether Complainant is entitled to recover out-of-pocket
expenses, and if so, the amount of those expenses.
STIPULATIONS
The following stipulations will apply concerning Attorney's
fees and expenses: 1) Should the Secretary's final decision and
order be upheld on appeal, Complainant's attorney, Ms. Garde, is
entitled to $33,360.00 in fees for work done up to the time of
the Secretary's March 21, 1995 decision; 2) Should the
Secretary's final decision and order be upheld on appeal,
Complainant's attorney is entitled to $2,000.00 for work done for
the hearing in this court; 3) Should the Secretary's final
decision be upheld, Complainant is entitled to $9,922.99 in
expenses for those cost reasonably incurred in connection with
this case before the Administrative Law Judge and the Secretary
up to the date of the decision on remand (the date of this
Recommended Order); 4) The federally mandated rate of interest
will apply to any judgement paid by the Respondent, from the date
of the final award of the Secretary to the date of payment to the
Complainant.
BACKGROUND
Complainant Noah J. Artrip (hereinafter "Complainant") was
employed by EBASCO (hereinafter "Respondent") from 1982 until
1988, as an inspector, primarily in the area of paint coatings.
Complainant worked at the Comanche Peak Steam Electric Station in
Glen Rose, Texas for sixteen months. While at Comanche Peak,
Complainant participated in a Nuclear Regulatory Commission
("NRC") investigation of coating failures and quality issues. As
a result of the investigation, the NRC required a major rework of
the station. Soon after Complainant was transferred to the South
Texas Nuclear Plant in Bay City, Texas. During this time, he
engaged in protected activity under the ERA by reporting various
violations to the NRC, which were investigated and found to be
valid.
[PAGE 3]
On December 9, 1988, after the NRC investigation, which was
high-profile and resulted in large expense to the Respondent,
Complainant was laid off in a reduction in force at the South
Texas Nuclear Plant. Previous to this, on November 30, 1988, in
anticipation of the impending layoff, Respondent compiled a
master list of fifty-eight South Texas employees for whom new
assignments were being pursued. (CX 1-25) ("CX 1" refers to
Complainant's original exhibits admitted pursuant to the original
claim. "CX 2" refers to the exhibits admitted during the hearing
on damages). The list, which included Complainant, was
distributed to certain managers at various projects where
Respondent was seeking either to hire directly, or to refer to
the contractor or licensee for hire. Id. After the
layoff, the names of 14 people were provided to Texas Utilities
as candidates they might select for several thermolag positions
at the Comanche Peak Nuclear facility in Glen Rose, Texas. (CX
1-26) Complainant was not included on this list. Of the 14
people referred to Texas Utilities on December 16, 1988, six were
selected to work at Comanche Peak.
Complainant filed a charge of retaliation under the ERA for
Respondent's failure to place his name on the referral list, and
his subsequent failure to be hired by Texas Utilities. A hearing
was held and the Administrative Law Judge recommended that the
case be dismissed. Complainant appealed the ALJ's findings to
the Secretary. On March 21, 1995, the Secretary overturned the
ALJ's recommended decision and held that by failing to place
Complainant's name on a list of persons eligible for
consideration for employment at Comanche Peak, Respondent had
violated the ERA because they had interfered with a former
employees prospective employment opportunities based on a
discriminatory motivation. (Secretary's opinion at 6, 13). The
Secretary found that the Complainant was excluded from the list
because Respondent knew, or at least suspected, that the
personnel manager from Texas Utilities, Doug Snow, "would not be
interested in rehiring a former inspector from his department who
had participated in an NRC investigation that forced a Post
Construction Hardware Validation Program, caused substantial
delay in the project, and left the company with untold financial
loss." (Secretary's opinion at 13). The Secretary then remanded
to fashion an appropriate relief. On June 27, 1995, this Court
held a one day hearing limited to the issue of appropriate remedy
and relief which should be awarded to Complainant.
DISCUSSION
Under the Energy Reorganization Act, whistleblowers are
entitled to various damages. Under Sec. 210(b)(2)(B):
[PAGE 4]
If, in response to a complaint filed under paragraph
(1), the Secretary determines that a violation of subsection
(a) of this section has occurred, the secretary shall order
the person who committed such violation to (i) take
affirmative action to abate the violation, and (ii)
reinstate the complainant to his former position together
with the compensation (including back pay), terms,
conditions, and privileges of his employment, and the
Secretary may order such person to provide compensatory
damages to the complainant. If an order is issued under
this paragraph, the Secretary, at the request of the
complainant shall assess against the person against whom the
order is issued a sum equal to the aggregate amount of all
costs and expenses (including attorneys' and expert witness
fees) reasonably incurred, as determined by the Secretary by
the complainant for, or in connection with, the bringing of
the complaint upon which the order was issued.
42 U.S.C. Section 5851(b)(2)(B).
Once an employee establishes a violation of the Act, there
is a presumption that the employee is entitled to back pay and
other remedies available under the law. Lewis v. Smith,
731 F.2d 1535, 1538 (11th Cir. 1984).
I. Back Pay
Complainant is entitled to back pay. The goal of back pay
is to make the victim of discrimination whole and restore him to
the position that he would have occupied in the absence of the
unlawful discrimination. Albemarle Paper Co. v. Moody,
422 U.S. 405. Therefore, the person discriminated against should
only recover damages for the period of time he would have worked
but for the wrongful termination; he should not recover damages
for the time after which his employment would have ended for a
nondiscriminatory reason. Martinez v. El Paso County, 710
F.2d 1102, 1106 (5th Cir. 1983).
Complainant asserts that he is entitled to back pay from the
date he was laid off, December 9, 1989, to the date Respondent
complies with this order. Complainant contends that he is
entitled to back pay for: 1) Employment at Comanche Peak from
January 20, 1989 to March 3, 1989 (when five of the six people
hired were laid off in a reduction in force) (Tr. 14); 2)
Continued employment at Comanche Peak until November 22, 1989
(assuming that Complainant would have been kept on rather than
the employee actually retained)
[PAGE 5]
Id.; 3) Eventual employment in a permanent position by
Respondent (of the five who were laid off on March 3, 1989, four
were later rehired by Respondent, two left after six weeks and
two took permanent positions) (Tr. 11).
First, we must assume that Complainant is entitled to back
pay for some length of time. Once discrimination has been
proven, a presumption of entitlement to back pay arises.
Lewis v. Smith, 731 F.2d 1535. The burden then shifts to
the employer to rebut this presumption by showing that the
discriminatee would not have been hired absent their
discrimination. Id. Here, Respondent could have shown
that Mr. Snow, the personnel manager at Texas Utilities, would
not have hired Complainant, whatever his motivation. Had
Respondents showed that Texas Utilities would not have hired
Complainant because of his previous whistleblowing activity,
Respondent's liability would have ended there. Even though there
is discriminatory motivation involved, this would not have been
Respondent's discriminatory motivation. Respondent is not liable
for other employers' discrimination. By failing to put
Complainant's name on a list, for a job he was not very likely to
get because of more than probable discrimination by the hiring
company, Respondent has opened themselves to liability.
Thus, we must assume that Complainant would have been hired by
Texas Utilities.
Next to be determined is the length of the period of back
pay owed. Absent evidence that Complainant's employment would
have continued past the end of his employment term (ie: the date
he would have been laid off), Respondent's back pay liability
should end on that day. Blackburn v. Martin, 982 F.2d 125,
129 (4th Cir. 1992); Martinez, 710 F. 2d at 1106. The
employment term under Texas Utilities is at most from January 20,
1989, until November 22, 1989, when the last employee hired from
Respondent was laid off.
One of the problems in assessing back pay in this case is
that the entity which would have hired Complainant is not the
same as the one which discriminated. For our purposes, we must
treat Texas Utilities, the entity which would have employed
Complainant, as if it were the entity which had discriminated
against Complainant. When assessing employment term, we
must use the same rationale with Texas Utilities as we would have
with Respondents directly. That is, Complainant's back pay must
end when his employment term would have ended, absent any
discrimination. It is clear that in the absence of any
discrimination, Complainant's employment term with Texas
Utilities would not have exceeded November 22, 1989.
[PAGE 6]
Complainant, however, seeks back pay past that date. This
must be denied. In Welch v. University of Texas, 659 F.2d
531, 535 (5th Cir. Unit A 1981), it was pure speculation whether
or not an employee would have been shifted to another grant job
after the grant which was providing the funds for her salary had
expired. The court found that mere speculation was not enough
and that the award for damages went only to the date that the
grant under which she was working expired. Id. Here, it
is simply speculation that Complainant would have been hired for
a different job, by a different company, after his employment
term with Texas Utilities. In Blackburn v.
Martin, the employee testified that he expected to be hired
by the employer on another project because other employers
usually gave preference to former employees. 982 F.2d at 129.
However, the court found that this was merely speculative and
insufficient to support the extension of back pay liability
beyond his original employment term. Id. Here,
preference by Respondent in rehiring Complainant was not even an
issue. Further, in assessing back pay damages, the relevant case
law demonstrates that only the term of employment affected by the
discrimination is used to calculate back pay. Subsequent
employment is not used in the back pay calculation. See
Blackburn, 982 F.2d at 129; Martinez, 710 F.2d at
1106; Edwards v. School Board, 658 F.2d 951, 956 (4th
Cir. 1981); Holley v. Northrop Worldwide Aircraft Servs.,
Inc., 385 F.2d 1375, 1377 (11th Cir. 1988); Pillow v.
Bechtel Construction, Inc., Case No. 87-ERA-35, Sec. Ord.,
July 19, 1993, slip op. at 26.
Complainant has asserted that it should recover back pay up
to the date that Respondent complies with this order because
Respondent has not met its evidentiary burden of showing that
Complainant was not qualified for the positions. This argument
must fail. The Complainant has the burden of establishing the
economic injury resulting from the adverse employment action.
Marks v. Prattco, 633 F.2d 1122, 1125 (5th Cir. 1981).
However, in establishing economic injury, if the Complainant is
claiming that the economic injury extended beyond the employment
term, then he must introduce evidence showing that this is the
case. Walker v. Ford Motor Co., 684 F.2d 1355, 1362 (11th
Cir. 1982). This proof may consist of no more than a showing
that the particular complainant's contract had been renewed in
the past, that contracts of similarly situated employees had been
renewed, or that the employer had made a promise of continued
employment. Id. Once this burden has been fulfilled,
then the Respondent has the burden to show by a preponderance of
the evidence that the complainant would not have remained in
employment beyond the contract term. Id. at 1361;
OFCCP v. PPG Indus., Inc., Case No. 86-OFC-9, Dep.
[PAGE 7]
Asst. Sec. Dec., Jan. 9, 1989, slip op. at 33-34.
Complainant has not established that his economic injury
extended beyond his employment term. Complainant did not show
that his contract had been renewed in the past, that contracts of
similarly situated employees had been renewed, or that the
employer had made a promise of continued employment. Complainant
could argue that contracts of similarly situated employees were
renewed, referring to the four people hired by Texas Utilities
who were then rehired by Respondent. However, Walker
specifically maintains that the contract must be renewed,
which means that the present employer must renew it, not a
subsequent employer. 684 F.2d at 1362. Therefore, Complainant
has not fulfilled his burden of showing economic injury extending
beyond the employment term. Thus, Complainant cannot recover
damages past the point of his term of employment.
Respondent has argued that Complainant should not recover
back pay past the date of March 3, 1989, when five of the six
people hired by Texas Utilities were laid off in a reduction in
force. However, it must be assumed that Complainant would have
been the last person in his work force to be laid off.
Nichols v. Bechtel Construction, Inc., 87-ERA-44 (ALJ May
4, 1993). Thus, the period of Complainant's back pay runs from
January 20, 1989, to November 22, 1989.
The back pay amount will be calculated by $2,860.00 x the
number of months worked, plus a stipulated factor of 20.8% for
fringe benefits. This would be $2,860.00 x 10 months (approx) =
$28,600.00 x (.208) + $28,600.00 = $34,549.00.
Also considered in the back pay calculation is the amount of
interim earnings made by Complainant during the back pay period.
Interim earnings in replacement employment should be deducted
from a back pay award. Blackburn, 86-ERA-4, Sec. Dec.,
Oct. 30, 1991. The employer, and not the complainant bears the
burden of proving a deduction from back pay on account of interim
earnings. Hadely v. Southeast Coop. Serv. Co., 86-STA-24,
Sec. Dec., June 28, 1991. Here, the only evidence of interim
earnings has been presented by the Complainant in the form of
Complainant's tax returns. The problem presented is how to
calculate which interim earnings were earned during the 10 month
period that Complainant would have been working for Texas
Utilities. Complainant's 1989 adjusted gross income was
$18,913.00. This figure does not reflect what amount of work
Complainant did during the time he would have worked for Texas
Utilities. Since Complainant would have worked 10 months out of
the year, or 83.3% of the year, then Complainant will only have
[PAGE 8]
83.3% of his interim earnings offset against his back pay. The
offset interim earnings will be $18,913.00 x .833 = $15,755.00.
The total amount of back pay due Complainant is $34,549.00 -
$15,755.00 = $18,794.00.
II. Interest
Complainant is also entitled to all appropriate prejudgment
interest on the award of back pay. Such interest will be
calculated in accordance with 29 C.F.R. 20.58(a), at the rate
specified in the Internal Revenue Code at 26 U.S.C. 6621.
III. Expenses
Complainant is further entitled to all reasonably incurred
expenses in bringing this complaint. DeFord v. Secretary of
Labor, 700 F.2d 281, 288 (6th Cir. 1983). Complainant's
expert witness, Dr. Richard N. Bean, submitted a bill for
,200.00. In light of current costs for expert witnesses, I
will let this amount stand.
Complainant listed as an expense a $927.00 airline ticket
for round trip airfare from Hawaii to Houston. Although
Respondent has objected to the authenticity of the sales slip,
the amount in question is a reasonable amount for airfare. The
hotel bill, transcripts, copying fees, meals, and auto rental
bills are all reasonable. Complainant will be entitled to
$2,644.29 for total expenses incurred on Remand Hearing.
IV. Successor Liability
EBASCO was a wholly owned subsidiary of Enserch Corporation,
which sold EBASCO's operations to Raytheon Corporation on
December 22, 1993. (Tr. 7). The surviving entity is Esicorp,
which is owned by Enserch. Respondent, at the hearing, stated
that Esicorp retains the liability in this case. This assertion
will stand.
V. Compensatory damages
Complainant has not claimed compensatory damages.
ORDER
It is therefore ORDERED that:
1. Respondents shall pay to Complainant back pay in the
amount of $34,549.00 less interim earnings of $15,755.00 for a
total of $18,794.00, plus the appropriate interest at the IRS
rate, computed until the date of date of payment to Complainant.
2. Respondents shall pay to Complainant expenses reasonably
incurred in connection with this hearing, in the amount of
$2,644.29.
3. Respondents shall pay to Complainant expenses reasonably
incurred as per the stipulation.
4. Respondents shall pay to Garde Law Office, all
reasonably incurred attorney fees and costs as per the
stipulation.
_______________________
Richard D. Mills
Administrative Law Judge
NOTICE: This Recommended Decision and Order and the
administrative file in this matter will be forwarded for review
by the Secretary of Labor to the Office of Administrative
Appeals, U.S. Department of Labor, Room S-4309, Frances Perkins
Building, 200 Constitution Avenue, N.W., Washington, D.C. 20210.
The Office of Administrative Appeals has the responsibility to
advise and assist the Secretary in the preparation and issuance
of final decisions in employee protection cases adjudicated under
the regulations at 29 C.F.R. Parts 24 and 1978. See 55
Fed Reg. 13250 (1990).
[ENDNOTES]
[1] As Administrative Law Judge E. Earl Thomas has retired
since the time the Decision and Order was issued, this matter is
being considered by the undersigned SeeKendall v.
Bethlehem Steel Corp., 3 BRBS 255, BRB No. 75-205 (February
26, 1976).
