Administrator, Wage and Hour Div., USDOL v. Graham and Rollins, Inc., ARB No. 2019-0009, ALJ No. 2018-TNE-00022 (ARB Nov. 16, 2020) (Decision and Order)

LIMITATIONS PERIOD FOR COMMENCEMENT OF H-2B ENFORCEMENT ACTION; FIVE YEAR LIMITATIONS PERIOD OF 28 U.S.C. § 2462 APPLIES

In Administrator, Wage and Hour Div., USDOL v. Graham and Rollins, Inc., ARB No. 2019-0009, ALJ No. 2018-TNE-00022 (ARB Nov. 16, 2020), the WHD Administrator had determined that Employer violated certain H-2B provisions related to Applications for Temporary Employment Certification and I-129 Petitions for a Nonimmigrant Worker filed in 2011 and 2012. The ARB adopted the ALJ’s Decision and Order Granting Employer’s Motion to Dismiss and the ALJ’s Order Denying Administrator’s Motion for Reconsideration. The ALJ determined that the enforcement action was time barred by 28 U.S.C. § 2462 despite the Administrator arguments as to why it should not. Because the Administrator’s determination letter was issued more than five years after the alleged violations occurred and the claims accrued, the ALJ found that that the proceeding had not been timely commenced, and was time barred under § 2462.

Administrator, Wage and Hour Div., USDOL v. Five M’s, LLC, ARB No. 2019-0014, ALJ Nos. 2015-FLS-00010, 00011 (ARB Nov. 13, 2020) (per curiam) (Decision and Order)

ASSESSMENT OF CIVIL MONEY PENALTY (CMP) FOR FLSA VIOLATIONS; EMPLOYING DE NOVO REVIEW, ARB SET CMP LOWER THAN MAXIMUM AMOUNT SOUGHT BY WHD ADMINISTRATOR, BUT HIGHER THAN MITIGATED AMOUNT SET BY ALJ; ALTHOUGH THERE WERE AGGRAVATING FACTORS, ARB FOUND THAT SMALL SIZE OF RESPONDENTS’ BUSINESS, AND RELATIVELY SMALL SIZE OF AMOUNTS OWED TO EACH EMPLOYEE, WERE MITIGATING FACTORS UNDER THE FACTS OF THE CASE

DEFENDANTS REQUEST FOR SANCTIONS BASED ON CONDUCT OF WHD ADMINISTRATOR’S REPRESENTATIVES DURING SETTLEMENT NEGOTIATIONS; CONTRACT DISPUTES ARE OUTSIDE THE ARB’S SCOPE OF AUTHORITY TO ADJUDICATE; EVEN IF ARB HAS SUCH AUTHORITY, DEFENDANTS FAILED TO PROVE THEIR ALLEGATION THAT THE WHD HAD WRONGFULLY CONVERTED A CONDITIONAL TENDER OF A SETTLEMENT PAYMENT INTO A PAYMENT FOR SATISIFICATION OF A PREVIOUS COURT ORDER

In Administrator, Wage and Hour Div., USDOL v. Five M’s, LLC, ARB No. 2019-0014, ALJ Nos. 2015-FLS-00010, 00011 (ARB Nov. 13, 2020) (per curiam), the WHD Administrator assessed a civil money penalty on Respondents for violations of the FLSA’s overtime and minimum wage requirements. After a hearing, the ALJ reduced the CMP. Upon de novo review, the ARB ruled:

   We conclude that neither the maximum $1,100 penalty assessed by the Administrator nor the reduced $250 penalty imposed by the ALJ are appropriate based on the facts and circumstances presented in the record. For the reasons that follow, we hold that the Administrator erred by neglecting to consider and account for important mitigating factors analyzed by the ALJ which do warrant reducing the CMP from the statutory maximum. However, we disagree with the weight the ALJ afforded to the mitigating factors. The several aggravating factors present in this case, including the willful and repeated nature of Respondents’ conduct and Respondents’ lack of good faith efforts to comply with the law, necessitate a larger penalty than that which was imposed by the ALJ.

Slip op. at 7-8.

The ARB noted that the record firmly showed that Respondents’ violations were both repeated and willful, and that Respondents had been provided information to assist them in compliance following a 2005 investigation and a 2012 conciliation agreement. The violations impacted a large portion of Respondents’ workforce. Moreover, during the 2014 investigation, Respondents refused to offer even a token commitment to comply with the FLSA. The ARB agreed with the ALJ’s finding that Respondents’ explanations for their conduct had been unreasonable. The ARB, however, found that the record did not support the ALJ’s further finding that the conduct was the product of an honest mistake as to the applicability of the FLSA overtime requirements for commissioned employees. These factors supported a larger penalty than that assessed by the ALJ.

The ARB, however, found that the ALJ reasonably considered critical mitigating factors not considered by the Administrator. Respondents were a small business. Although the small size of a business does not require reduction of a CMP, it is a factor that must be considered, and here the ARB agreed with the ALJ that Respondents’ size warranted a reduction. The ARB also agreed with the ALJ that Respondents’ conduct was mitigated by the relatively small size of the amounts owed by Respondents to each employee (an average of just $414 per employee over a two year period). Balancing the relevant factors, the ARB assessed a CMP of $550 for each of the 35 underpaid employees.

The ARB was not persuaded by Respondents’ argument that the WHD Administrator should be sanctioned for its conduct in settlement negotiations, specifically allegedly treating a check submitted by Respondents as partial satisfaction of a court judgment, whereas Respondents contended that the check was a conditional settlement offer constituting the first payment on an installment plan. The ARB found that this was a contract dispute beyond its scope of authority to adjudicate. The ARB also found that, assuming it had the power to resolve the issues raised by Respondents, Respondents had not presented any evidence to support the contention that the check was delivered as part of a settlement offer.

Colley v. Union Pacific Railroad Co., ARB No. 2018-0063, ALJ No. 2017-FRS-00071 (ARB Nov. 6, 2020) (Order Reversing and Remanding)

CONTRIBUTING FACTOR CAUSATION IN FRSA CASE; ARB REMANDS CASE ARISING IN EIGHTH CIRCUIT FOR FURTHER PROCEEDINGS IN LIGHT OF ARB’S REJECTION OF “INEXTRICABLY INTERTWINED” ANALYSIS IN THORSTENSON, AND THE EIGHTH CIRCUIT’S REQUIREMENT OF PROOF OF INTENTIONAL RETALIATION

AFFIRMATIVE DEFENSE; CONCURRING OPINION VIEWS SPEEGLE FACTORS AS AN ANALYTICAL AID, AND NOT A SET OF BRIGHT-LINE RULES; ADDRESSES HOW TO ANALYSE VIOLATIONS OF COMPANY POLICY IN REGARD TO AFFIRMATIVE DEFENSE

In Colley v. Union Pacific Railroad Co., ARB No. 2018-0063, ALJ No. 2017-FRS-00071 (ARB Nov. 6, 2020), the ALJ found that Complainant established contributing factor causation under the FRSA retaliation provision. In making this finding, the ALJ applied the “inextricably intertwined” analysis.

On appeal, the ARB noted that after the ALJ had issued her Decision in Colley, the ARB held in Thorstenson v. BNSF Ry. Corp., ARB Nos. 2018-0059, -0060, ALJ No. 2015-FRS-00052 (ARB Nov. 25, 2019), that ALJs should not apply the “inextricably intertwined” or “chain-of-events” analysis to create a presumption of causation. The ARB also noted that the Colley case arose in the Eighth Circuit, and that the U.S. Court of Appeals for the Eighth Circuit had held that an employee must prove intentional retaliation by the employer. See Kuduk v. BNSF Ry. Co., 768 F.3d 786, 791 (8th Cir. 2014); BNSF Ry. Co. v. U.S. Dep’t of Labor Admin. Review Bd., 867 F.3d 942, 946 (8th Cir. 2017); Dakota, Minn. & E. R.R. Corp. v. U.S. Dep’t of Labor Admin. Review Bd., 948 F.3d 940, 947 (8th Cir. 2020) (unequivocally rejecting the chain-of-events and inextricably intertwined theories of causation). The ARB thus remanded the case to the ALJ for further proceedings.

One member of the ARB filed a concurring opinion to address the employer’s affirmative defense. The concurring member noted the ARB’s decision in Speegle v. Stone & Webster Constr., Inc., ARB No. 2013-0074, ALJ No. 2005-ERA-00006, slip op. at 11-12 (ARB Apr. 25, 2014), which listed factors that should be considered in assessing the “clear and convincing” evidence defense. The concurring member indicated that the Speegle factors should be viewed as assisting a fact-finder and not as a bright-line rule for all cases. The member stated: “A fact-finder may simply apply the statutory and regulatory text without additional nonstatutory and nonregulatory factors. We stated in Clem v. CSC Computer Sci. Corp. that ‘these [Speegle] factors are not expressly prescribed in the statutory text and such a rule was not necessary to resolve the matter at issue . . . . A fact-finder must holistically consider any and all relevant, admissible evidence when determining whether an employer would have taken the same adverse action against an employee in the absence of any protected activity.’” Slip op. at 6. The concurring member also discussed how a complainant’s violations of company policy may be analyzed as an affirmative defense, noting that an reasonable and honest belief of such a violation can satisfy the burden, but that it is not enough to merely show that the conduct violated a company policy or constituted a legitimate business reason for the adverse personnel action.

Johnson v. BNSF Railway Co., ARB No. 2021-0004, ALJ No. 2016-FRS-00029 (ARB Nov. 6, 2020) (Order Granting Stipulated Motion to Withdraw Appeal)

The ARB granted the parties’ Stipulated Motion to Withdraw Petition for Review.

Brucker v. BNSF Railway Co., ARB Nos. 2018-0067, -0068, ALJ No. 2013-FRS-00070 (ARB Nov. 5, 2020) (per curiam) (Decision and Order)

CONTRIBUTORY FACTOR CAUSATION; ARB AFFIRMED ALJ’S FINDING THAT COMPLAINANT FAILED TO CARRY HIS BURDEN OF PROOF UNDER THE FACTS OF THE CASE; FAILURE TO DISCLOSE CRIMINAL CONVICTION ON EMPLOYMENT APPLICATION; SERIOUS WORK VIOLATIONS; RESPONDENT’S LENIENCY; LACK OF TEMPORAL PROXIMITY

In Brucker v. BNSF Railway Co., ARB Nos. 2018-0067, -0068, ALJ No. 2013-FRS-00070 (ARB Nov. 5, 2020) (per curiam), the ARB affirmed the ALJ’s finding that Complainant failed to prove by a preponderance of the evidence that his alleged protected activity under the FRSA was a contributing factor to Respondent’s decision to terminate Complainant’s employment. In a very fact-specific decision, the ARB found that several factors supported the ALJ’s findings.

First, Complainant had admitted that he lied on his employment application when he checked “no” when asked if he had ever been convicted of a crime other than traffic violations. Complainant had previously plead guilty to misdemeanor assault, and served a suspended sentence. Although Complainant argued that the ALJ should have credited his testimony that his assistant supervisor at the time told him that the railroad was only interested in felony convictions, the ARB pointed out that Complainant had not informed HR of the conviction, and that other witnesses familiar with Respondent’s hiring practices testified that Complainant’s claim that the assistant supervisor told him to check the “no” box was not plausible.

Second, Complainant had committed a second serious violation within the applicable review period, which under Respondent’s employee performance accountability policy could result in dismissal. The ARB noted that the ALJ found that Respondent administered the discipline in accordance with its policies and the collective bargaining agreement. The ARB noted the ALJ’s conclusion that these violations, taken together with Complainant’s dishonestly on the application, were highly probative to Respondent’s decision to terminate the employment.

Third, the decision to terminate Complainant’s employment was made by multiple individuals both inside and outside Complainant’s supervisory chain, the department in which he worked, and the locality.

Fourth, Complainant’s protected activity occurred two years before the termination decision. The ALJ found that Complainant’s supervisors had the opportunity to terminate Complainant’s employment earlier for violations in 2010 and 2011, but had exercised leniency. The ARB agreed with the ALJ that such leniency weighed against finding contributory factor causation between Complainant’s 2009 alleged protected activity and the termination in 2012.