Johnson began work as a driver for Landstar Poole on January 23, 1998. Landstar terminated his employment on March 7, 1998, for allowing his cousin – who did not possess a commercial driver's license – to back up the Landstar Poole truck on a public street. A police officer became involved in the incident when he apprehended that someone was attempting to back the truck into him. When the officer approached the truck Johnson's cousin fled, leaving Johnson to face the police. The police officer found six beer bottles in the cab and charged Johnson with driving under the influence. Although the DUI charge was subsequently dropped (evidently because Johnson had not been driving the truck at the time of his arrest), Landstar Poole terminated Johnson's employment over the incident. Johnson testified that allowing someone other than himself to drive the truck was a violation of Landstar Poole policy.
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The ALJ found that allowing Johnson's cousin to drive the truck was "dangerous and could have resulted in injury to the public," and therefore was sufficiently egregious to toll Roadway's back pay liability. On review Johnson argues that his termination from Landstar should not be held to toll his back pay entitlement. Instead, Johnson argues that the amount he would have earned had he remained with Landstar should be deducted from the back pay accrued between March 7, 1998, and the date Roadway reinstated him.
The Board has previously held that the mitigation of damages doctrine requires that a wrongfully discharged employee not only diligently seek substantially equivalent employment during the interim period but also that the employee act reasonably to maintain such employment. Cook v. Guardian Lubricants, Inc., ARB No. 97-055, ALJ No. 95 -STA-43, slip op. at 6 (ARB May 30, 1997). Moreover, "[a] failure to mitigate damages through the retention of employment will reduce the employer's back pay liability in that the back pay award will be reduced by no less an amount than that which the complainant would have made had he remained in the interim employment throughout the remainder of the back pay period." Id. (emphasis supplied).
Citing Thurman v. Yellow Freight Systems, Inc., 90 F.3d 1160, 1169 (6th Cir. 1996) and Patterson v. P.H.P. Healthcare, 90 F.3d 927, 937 (5th Cir. 1996), the Board articulated the principle that "only if the employee's misconduct is gross or egregious, or if it constitutes a willful violation of company rules, will termination resulting from such conduct serve to toll the discriminating employer's back pay liability." Cook, ARB No. 97-055, slip op. at 6 (footnote omitted). The Board found that Cook was not terminated for engaging in gross or egregious conduct, or a willful violation of company rules and therefore concluded that Cook's entitlement to back pay was not extinguished because of the termination. Id. at 8.
Applying this standard to this case, we concur with the ALJ's determination that the behavior that resulted in Johnson's termination from Landstar Poole was a willful violation of Landstar's policy and sufficiently egregious to affect Johnson's entitlement to back pay. Johnson allowed someone who was neither an employee of Landstar nor in possession of a commercial driver's license to drive Landstar's truck on a public street. This activity was dangerous to the public and could have resulted in extensive damage to Landstar's truck.
Both Thurman and Patterson relied on the Fourth Circuit's reasoning in Brady v. Thurston Motor Lines, Inc., 753 F.2d 1269, 1277-79 (4th Cir. 1985). In that case, the court drew an analogy between the failure of a claimant to exercise reasonable diligence in the mitigation of damages by voluntarily quitting comparable, interim employment and a complainant who loses similar employment by engaging in misconduct. The court held, "To permit claimants the freedom of substantially unrestrained conduct during interim employment, unfettered by the loss of back pay, would serve only to punish the employer for the misconduct of the claimant, and be inconsistent with the requirement of exercising reasonable diligence."
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In fashioning a backpay remedy for claimants who were justifiably discharged, the Fourth Circuit relied on the NLRB decision, Knickerbocker Plastics Co, Inc., 132 NLRB 1209, 1215 (1961). In Knickerbocker Plastics Co. the NLRB held that complainants who voluntarily quit interim employment would "be deemed to have earned for the remainder of the period for which each is awarded backpay the hourly wage being earned at the time such quitting occurred." Knickerbocker Plastics Co., Inc., 132 NLRB at 1215. Where the employee secures interim employment which pays a higher amount, the employer is entitled to a credit for those earnings rather than the earnings held at the time of the voluntary quit. Id. However, the Fourth Circuit adopted the following modification: "periods of unemployment following justified discharges are to be completely excluded from the back pay period. During such a period the claimant has excluded himself from the employment market." Brady, 753 F.2d at 1280. Accord EEOC v. Delight Wholesale Co., 973 F.2d 664, 670 (8th Cir. 1992) (backpay properly tolled during period between each voluntary quit and next full-time permanent position).
Applying the Brady rule to the facts of this case results in a complete bar to the payment of backpay between March 7, 1998, the date on which Landstar Poole terminated Johnson's employment, and the beginning of his employment with Trans-State Lines. Thereafter, the Respondent is entitled to a credit against its backpay liability for the greater of the amount of the earnings Johnson had in subsequent interim employment or the amount he was paid for his employment at Landstar Poole.
In adopting the approach of the Brady case, we reject Complainant's contention that Cook requires a reduction in back pay by only the amount which the Complainant would have made had he remained at Landstar Poole. As noted above, Cook sets a floor, not a ceiling on the backpay reduction. Under these circumstances (termination of interim employment because of the employee's misconduct), reducing the backpay award to zero until new interim employment is secured is both appropriate, and consistent with Cook, Similarly, the approach we adopt is consistent with a correct reading of the cases cited by Respondent.
The ALJ calculated that the total of back pay and pension contributions for the period between Johnson's discharge from Roadway and the termination of his employment by Lanstar Poole amounted to $209,986.36. From that amount he subtracted Johnson's interim wages and $11,930.40, for a total of $168,279.96 in back pay liability and pension benefits. ALJ 11 at 22. However, in Appendix A the ALJ also provided calculations for Johnson's back pay award assuming that the termination by Landstar Poole did not extinguish back pay. ALJ II at 23-24. These calculations result in $225,601 for back pay liability and pension contributions. Because we find that Johnson is not entitled to backpay for the period between his discharge by Landstar Poole and his next position with TransState, the ALJ's backpay calculation in Appendix A must be reduced further to exclude payments for that period. Roadway is also entitled to a credit for the higher of the wages earned in subsequent interim employment or the wages earned while employed by Landstar Poole.
III. The ALJ's Back Pay Calculations
Roadway objects to two aspects of the ALJ's back pay calculations. We discuss each in turn.
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A. Use of wages of representative employees to calculate Johnson's back pay
In an effort to narrow the issues regarding the back pay calculation, Johnson and Roadway stipulated to the wages of employees immediately above and below Johnson on the seniority list for the years that back pay was owed. However, the parties did not agree on how those numbers should be used to calculate back pay. In particular, Roadway argued that because of Johnson's attendance record, Johnson never earned total wages similar to those representative employees. Roadway presented evidence that for the years 1990 though 1994 Johnson earned only 82% of what the representative employees earned. Furthermore, during that portion of 1999 that Johnson worked for Roadway, he earned 77% of what the representative employees earned. Therefore, to award Johnson a wage representing the average of those two employees would amount to a windfall. The ALJ rejected Roadway's argument: "I will not speculate about Johnson's conduct and determine whether he would have earned less than other representative employees. I resolve the uncertainties against the discriminating employer and use the wages of comparable employees in determining Johnson's back pay award." ALJ II at 19. The ALJ therefore calculated Johnson's back pay by subtracting Johnson's interim earnings from the average amount the representative employees earned in each year. Roadway challenges this ruling on the ground that Johnson would not, in fact have earned as much as the representative employees if he had continued to be employed by Roadway. Because substantial evidence supports the ALJ's findings, we will not disturb them.
The purpose of a back pay award is to return the wronged employee to the position he would have been in had his employer retaliated against him. Albermarle Paper Co. v. Moody, 422 U.S. 405 418-421 (1975) (under Title VII). Back pay calculations must be reasonable and supported by evidence; they need not be rendered with "unrealistic exactitude." Cook v. Guardian Lubricants, Inc., ARB No. 97-005, slip op. at 11 n.12 citing Beltway v. American Cast Iron Pipe Co., Inc., 494 F.2d 211; 260-61 (5th Cir. 1974). Roadway presented evidence that for the four years immediately preceding his termination, Johnson earned significantly less than the representative employees. Thus, although the representative employees averaged $301,222 total wages in 1990 through 1994, Johnson earned $246,486. REX 18-20. Additionally, the parties stipulated that during 1999 the average gross wages of the representative employees was $1,311 weekly. Roadway argues that in contrast, Johnson averaged only $983 in gross wages.6 However, no evidence was presented from which a trier of fact could actually determine the source of these disparities. Without more, the bare figures upon which Roadway seeks to rely do not constitute evidence of sufficient weight to overcome the ALJ's findings. 7
1 Citations to the record are as follows: Recommended Decision and Order (ALJ I);Decision and Order of Remand (ARB I); Recommended Decision and Order on Remand (ALJ II); Hearing Transcript, 1999 (TR. I ___); Hearing Transcript, 2000 (TR II ____); Joint Exhibit (JEX ___); Complainant's Exhibit (CEX ___); Respondent's Exhibit (REX ___).
2 In a September 3, 1999 Order Granting Attorney Fees, the ALJ recommended that Roadway pay Johnson's attorney $28,757.16 for fees and expenses.
3 This is not a case in which the employer proved that the former employee made no effort to secure suitable employment and therefore the employer was relieved of the burden of providing availability of substantially equivalent jobs. See, e.g., Greenway v. Buffalo Hilton Hotel, 143 F.3d 47, 54 (2d Cir. 1998); Quint v. Staley, 172 F.3d 1, 15 (1st Cir. 1999)
4 In light of this holding it is not necessary for the Board to decide whether the ALJ erred in ruling that the positions at the three unionized companies were not substantially equivalent to Johnson's former position at Roadway. However, we view with skepticism the ALJ's determination that a complainant can refuse subsequent employment without adversely affecting his back pay entitlement if he would be required to "start at the bottom of the seniority list, would be paid at a lesser rate than more senior employees, and [would be] unable to select his preferred bid." ALJ II at 15. In a significantly unionized industry such as the trucking industry, a complainant would always be required to begin his interim employment with a new company at the bottom of the seniority list, with all that entails. We think it unlikely that those facts in and of themselves, could, particularly after the passage of a reasonable amount of time without employment, protect a complainant from charges that he failed to mitigate his damages. See OFCCP v. Louisville Gas & Elec. Co., No. 88-OFC-12, slip op. at 4 (ESA Asst. Sec'y Jan. 14, 1992) (A corollary of the substantially equivalent position requirement is that a Complainant who is unable, after a reasonable period of time, to find comparable employment must lower his sights and consider other available, suitable employment.). OFCCP v. WMATA, No. 84-OFC-8, slip op. at 4 (ESA Asst. Sec'y Aug. 23, 1989) (a complainant, of course, may not sit idle for ten years if substantially equivalent employment is not available). See alsoFord Motor Co. v. EEOC, 458 U.S. 219, 232-33 (1982) ("The [Title VII] claimant, after all, plainly would be required to minimize his damages by accepting another employer's offer even though it failed to grant the benefits of seniority not yet earned.") (emphasis added).
5 On remand the ALJ found that Johnson "had justifiable reasons for leaving his employment at Arrowhead Construction, Celadon Trucking, EVI Services, DOT Leasing, Aaron's Limousine, and Laura Stewart . . .," and therefore Johnson's departure from those jobs did not amount to a failure to mitigate damages. Roadway does not challenge that ruling, and we will not disturb it.
6 In 1999, Johnson was employed by Roadway for 22 weeks and earned gross wages of $21,629. He also received $11,930 in back pay, for a total reflected on his W-2 of $33,559. For purposes of calculating back pay, the appropriate amount is $21,629. REX 16, 18.
7 Johnson's earnings over the last five years he was employed by Roadway did not bear a consistent relationship to those of the representative employees. See Respondent's Brief, Tab 1. Contrary to Roadway's assertion that "[F]or five years Johnson earned significantly less than the employees above and below him on the seniority list," Roadway's own exhibit shows that for three of the five comparison years Johnson earned approximately $1,000 to $3,500 more than one representative employee, but approximately $7500 to $22,800 less than the other (1990-1992). For 1993, Johnson earned approximately $3,500 less than one employee and approximately $17,500 less than the other. In 1994, however, Johnson's income dipped to approximately $32,500 as compared to over $50,000 during the four preceding years, and he earned approximately $22,800 less than one employee and $31,100 less than the other. His earnings in 1999 also were lower than those of either counterpart. Thus, his earnings were not a consistent percentage of the average of the earnings of the two other employees. Applying a percentage reduction based on averaging the 1990-1994 data, as Roadway proposes, would mean applying a figure significantly influenced by the 1994 year which was very unlike Johnson's earnings from 1990-1993. Although simply averaging the earnings of the representative employees (Collins who over the period 1990-94 had much higher earnings than Johnson and Essary whose earnings over that period, while both above and below Johnson's, were more in line with Johnson's) has the problems of any such average, it does not raise the difficulty of likely under paying Johnson as Roadway's solution might.