Dated: March 12, 1997

Case Nos.: 89-ERA-07/17

In the Matter of:

Thomas J. Saporito, Jr.
    Complainant

    v.

Florida Power & Light
Company
    Respondent

   This Administrative Law Judge, by Order dated February 28, 1997, invited the parties in the above-captioned matter to brief the issue of whether an employer is entitled to a credit for settlements obtained in conjunction with other so-called whistleblower litigation in assessing the amount of back pay damages due to a complainant. This Judge indicated in that Order that he was inclined to deduct from a back pay award only that settlement amount that Respondent could prove constituted compensation of lost wages. Both Complainant and Respondent submitted briefs on the issue. The Complainant wholly supports this Judge's inclination, see Complainant's Brief on Order Dated February 28, 1997,¹ and Respondent has articulated reasons in an attempt to persuade me otherwise. See Respondent's Brief in Response to Order of ALJ. I am persuaded, in part, by Respondent's brief.

   Respondent submits that it is not only proper to deduct those

amounts designated in the settlement agreements as back wages from any award of back pay in this case, but that it is also proper to deduct those amounts designated, or reasonably presumed to be, front pay from any award of back pay damages in this case. Respondent rationalizes as follows: front pay is, in essence, a continuation of back pay that represents lost wages. Accordingly, front pay should be deducted as interim earnings. The fact that there may be no amount in a settlement agreement specifically designated as front pay should not prohibit their deduction from back pay.² At least part of a settlement agreement is for compensatory damage. Compensatory damages in cases filed pursuant to the ERA average between $10,000 and $50,000. Therefore, any settlement received by Complainant beyond $50,000 may be presumed to be compensation for lost wages. This presumption is supported by Complainant's testimony that he lives off the settlement proceeds, that he has not sought re-employment,³ and that he listed his occupation on his latest tax forms as 'investor.' This presumption is further supported by the fact that Complainant has not been reinstated by any of the companies with whom he has settled. See Generally Respondent's Brief, pp. 2-5.

    Respondent also submits that capital gains and dividends received by Complainant from his investments should also be deducted from any back pay award. Respondent argues the gains and dividends are investment income earned by a self-employed investor and Respondent concludes that self-employment proceeds constitute interim earnings which properly should be deducted from any back pay award. See Generally Respondent's Brief, pp. 5-6.

   This Judge is unpersuaded by Respondent's argument that I should deduct front pay from a back pay award for two reasons. First, assuming arguendo that it might be proper to make some sort of deduction of front pay because it could be shown to constitute lost wages⁴ , this Judge would logically deduct that front pay from an award of front pay, if any, in this case. It would seem completely illogical to deduct that front pay, meant to compensate for future lost wages, from an amount meant to compensate for past lost wages. Secondly, the Respondent's suggestion as to how this Judge determine the amount, if any, apportioned to front

   And so it is ORDERED that Complainant submit, within thirty (30) days of receipt of this Order, an affidavit attesting to (1) the amount of wages he has received since his termination at Respondent corporation, (2) whether that amount is accurately reflected on his tax forms, (3) Complainant's capital gains and dividends earned since his termination at Respondent corporation,⁵ and (4) whether that amount is accurately reflected on his tax forms.

   Furthermore, it is ORDERED that the parties, who are now in receipt of the entire remand proceeding transcript, file their post-hearing briefs within thirty (30) days of receipt of this Order. Complainant shall then be entitled to fifteen (15) days from receipt of Respondents's brief to submit to the Court and to Respondent a written demand wherein he sets forth the back wages and compensatory damages he seeks herein. Respondent shall then be entitled to fifteen (15) days from receipt of the demand to file a response thereto.

   This Judge recommends the parties continue to attempt to negotiate a settlement of this action as they review the record and prepare their respective briefs.

      DAVID W. DI NARDI
      Administrative Law Judge

Dated: MAR 12 1997

Boston, Massachusetts

DWD:jw:gcb

¹I will note that Complainant suggests this Administrative Law Judge may award exemplary damages in this case. As support therefor, Complainant cites 42 U.S.C. §300j-9(i)(2)(B)(ii) and 15 U.S.C. §2622(b)(2)(B). Complainant's claim implicates neither of these federal statutes. Accordingly, the remedy provisions of those statutes do not apply to this Complainant.

²Respondent notes the parties to a settlement agreement may have had ulterior motives for not designating front pay as such, i.e., the parties may have sought to avoid the tax consequences of so designating a portion of the settlement amount.

³I will note Complainant states he has not sought reemployment in the nuclear power industry since 1994 allegedly because he is being blacklisted by the industry.

⁴An argument I do not herein adopt.

⁵In the event that Complainant's capital gains and dividends have been earned by investment funds comprised of settlement proceeds and personal assets, Complainant should submit a realistic apportionment of the two in affidavit form.