ARB Decision in Nuclear Whistleblower Case Underscores Favorable Causation Burden for Whistleblowers
The Department of Labor Administrative Review Board’s recent decision in Armstrong v. Flowserve US, Inc., ARB Case No. 14-023 (Sept. 14, 2016) underscores how difficult it is for employers to obtain summary decision in whistleblower retaliation cases and how the causation standard in nuclear whistleblower retaliation cases is favorable for whistleblowers.
Takeaways for Whistleblowers:
- At the summary-decision stage, a showing of temporal proximity alone may raise an inference of causation sufficient to meet the contributing-factor standard. Temporal proximity and knowledge together raise a stronger inference of causation.
- An employer’s proffer of legitimate, nondiscriminatory reasons for an adverse employment action is insufficient to countervail a whistleblower’s evidence of contributory causation. At the summary-decision stage, an employer must provide clear and convincing evidence that the employment action “would have” occurred in the absence of the employee’s protected activity.
Robert Armstrong began working for Flowserve US, Inc., a pump, valve, and seal manufacturer, in 1978. As a machinist at Flowserve’s Charlotte Nuclear Service Center, in December 2011, Mr. Armstrong noticed defects in a pump that the corporation was manufacturing. Mr. Armstrong alerted his coworkers, and two of them who were certified to test the allegedly faulty part did so independently of each other. One stated that the part failed the test; the other stated that it passed. Still believing that the part was defective, in February 2012, Mr. Armstrong held a meeting to discuss his concerns with several employees, including the general manager of operations and the production supervisor. The part was tested again, and it passed again, but Mr. Armstrong believed that it was incorrectly tested.
After Mr. Armstrong’s reports, he says, “there was a noticeable difference in the way I was treated . . . .” Mr. Armstrong detailed several examples:
- Later in February 2012, Mr. Armstrong received a written warning after forgetting to store an oil can in the storage locker after using it to work on a machine. Mr. Armstrong stated that he and other employees who previously forgot to store such hazardous materials had never been reprimanded for that neglect.
- In March, Mr. Armstrong requested two days of vacation time and—for the first time in his thirty-four years of employment at Flowserve—was denied. He alerted the production supervisor that he would take off the two days without pay. When he returned to work, he received a “Final Written Warning” for failing to report to work as scheduled.
- In May, the general manager of operations and the production supervisor told Mr. Armstrong that he had to work an extra twelve-hour shift to complete an important work order. It was the first time in Mr. Armstrong’s thirty-four years with Flowserve that he was told to work a second shift. Mr. Armstrong said that he could not work the second shift because of personal obligations and knee trouble, but that he could nevertheless meet the deadline. Mr. Armstrong stayed late to ensure another employee was able to carry out the order, which that employee was able to do in only six hours. In spite of that, the corporation immediately began a “Termination Review” that recommended firing Mr. Armstrong.
Mr. Armstrong’s forgetting to stow the oil can in February, his absence in March, and his not working the second shift in May were included in the Termination Review. Four managers approved the Termination Review, three of whom subsequently met with Mr. Armstrong to tell him that he was fired.
In June, Mr. Armstrong filed a complaint with the Occupational Safety and Health Administration (“OSHA”). He claimed that Flowserve violated the Energy Reorganization Act of 1974 (“ERA”) by firing him in retaliation for his reporting the defective part, which he said constituted a safety violation. After OSHA dismissed his complaint, Mr. Armstrong requested a hearing before an administrative law judge (“ALJ”).
Flowserve filed a motion for summary decision, which, though acknowledging that Mr. Armstrong engaged in ERA-protected activity before being fired, asserted that his disciplinary record “demonstrates that his protected activity was not a contributing factor” in Flowserve’s decision to fire him. Mr. Armstrong asserted that the warnings he received following his protected report, as well as his termination, were in retaliation for that report.
The ALJ granted Flowserve’s motion for summary decision because Mr. Armstrong “failed to establish . . . the existence of a genuine issue of a material fact as to [whether] . . . that protected activity was a contributing factor to the adverse employment action.”
The ARB reversed and found that summary decision was improper because Mr. Armstrong showed genuine issues of fact establishing causation.
Contributing-Factor Causation Under the ERA at the Summary-Decision Stage
To prevail in an ERA claim, a whistleblower must demonstrate that his or her protected activity was a “contributing factor” in the adverse employment action. The ARB defined “contributing factor” as “any factor which, alone or in combination with other factors, tends to affect in any way the outcome of the unfavorable personnel action.” Id. at 5–6. Circumstantial evidence may be used to establish causation, since there rarely is direct evidence of retaliation.Id. at 7.
Evidence of Temporal Proximity Is Sufficient to Raise an Inference of Causation
Where an employer takes an adverse action soon after the employee engages in protected activity, there may be an inference of causation. If temporal proximity is combined with evidence that the employer knew of the employee’s protected activity, then an even stronger inference of causation is raised. Id. at 9.
Temporal proximity is evaluated based on when the employer’s allegedly retaliatory actions began, and Mr. Armstrong’s protected activity ended “only a matter of days, at most a week” before he was disciplined for forgetting to properly store the oil can. The ARB therefore found that this alone raised an inference of causation.
Moreover, the ARB found that because Mr. Armstrong had expressed his concerns to the production supervisor, who was the deciding official in the first two adverse actions, and to the general manager of operations, who was the deciding official in the final adverse action, Mr. Armstrong established “not only close temporal proximity but also knowledge by the deciding officials,” thereby establishing an “even stronger inference of causation.”
Retaliatory Motive and Pretext Bolster the Inference of Causation
Under the ERA, a complainant need not demonstrate that the employer had a retaliatory motive or that the employer’s business reasons for the adverse employment action are pretextual. However, such showings raise a genuine issue of fact regarding the employer’s reasons for the adverse action and so preclude summary decision.Id. at 15.
Here, both the production supervisor and the general manager of operations were responsible for Flowserve’s performance. Mr. Armstrong reported his complaints not only to them but also to the NRC, stating that “management at Flowserve Charlotte I feel is more concerned with the numbers for the end of the month and shipping product. I fully respect that, but a defective product in a safety related pump for [a] nuclear power plant is not acceptable.”
The ARB found that Mr. Armstrong’s “repeated concerns” possibly slowed production and irritated the managers. And his report to the NRC capped off Flowserve’s motive for retaliating against him. Mr. Armstrong thus raised a genuine issue of material fact regarding causation based on Flowserve’s motive.
Furthermore, Mr. Armstrong produced evidence to discredit Flowserve’s proffered reasons for terminating him:
- Regarding the oil can, Mr. Armstrong stated that “[t]here have been numerous times when other employees have forgotten to return hazardous materials to the appropriate storage lockers after working on the machine. To the best of my knowledge, no one has ever been reprimanded for doing so.”
- Moreover, when Mr. Armstrong was denied his requested vacation time, the production supervisor told him that the plant was busy and required him to work those days; however, Mr. Armstrong stated that his coworkers lacked a sufficient amount of work to even keep them busy during both days that he was absent.
- Finally, regarding the second shift that Mr. Armstrong was ordered to work, Mr. Armstrong testified that he had never in his thirty-four-year tenure with Flowserve been asked to work a second shift, that he notified his supervisors of his pre-existing obligations and physical limitations that precluded him from working the extra twelve hours, and that he nevertheless ensured that the work order was timely completed.
The ARB concluded, therefore, that “[w]ith respect to each adverse action taken against him, Armstrong presented sufficient evidence of disparate treatment, as well as evidence tending to show that his employer’s demands were unreasonable, to raise an inference of pretext, thus establishing additional disputed facts as to causation.”
Flow serve’s Same-Action Affirmative Defense
An employer can overcome a whistleblower’s showing of contributing-factor causation only by demonstrating by clear and convincing evidence that, absent the employee’s protected activity, the employer would have taken the adverse action anyway. Id. at 13. This is an onerous standard, and the ARB considers three factors in evaluating whether an employer has met it:
- “the independent significance of the non-protected activity cited by the respondent in justification of the personnel action”;
- “the facts that would change in the absence of the complainant’s protected activity”; and
- “the evidence that proves or disproves whether the employer would have taken the same adverse actions [in the absence of protected activity].” at 14.
To satisfy the third element, the ARB explained, the employer is required “to demonstrate . . . that the discipline to which [complainant] was subjected was applied consistently, within clearly-established company policy, and in a non-disparate manner consistent with discipline taken against employees who committed the same or similar violations.” Id.
While Flowserve may have provided evidence that Mr. Armstrong violated company policy, meaning the corporation had a legitimate business reason to fire him, this showing was insufficient to demonstrate that it not only “could have” but also “would have” terminated him had he not engaged in ERA-protected activity. To satisfy this standard, the ARB explained, Flowserve could have demonstrated that it had similarly disciplined other employees who had not engaged in protected activity for having committing similar violations. Flowserve failed to do so, thereby leaving in dispute its reasons for terminating Mr. Armstrong.
Because Mr. Armstrong established a genuine issue of fact regarding whether his ERA-protected activity was a contributing factor in Flowserve’s decision to fire him, as well as whether Flowserve would have taken the same action had he not engaged in protected activity, the ARB reversed the ALJ’s decision and order and remanded the case for further review.