Mercier v. United States Department of Labor ( 2017 )

United States Court of Appeals
For the Eighth Circuit
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No. 15-3369
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Michael Mercier
lllllllllllllllllllllPetitioner
v.
United States Department of Labor, Administrative Review Board
lllllllllllllllllllllRespondent
Union Pacific Railroad Company
lllllllllllllllllllllIntervenor
____________
Petition for Review of an Order of the
Department of Labor (except OSHA)
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Submitted: November 15, 2016
Filed: March 2, 2017
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Before COLLOTON, BEAM, and GRUENDER, Circuit Judges.
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BEAM, Circuit Judge.
Michael Mercier petitions for review of the final decision and order of the
Department of Labor's Administrative Review Board (ARB), which affirmed the
Department of Labor's Administrative Law Judge (ALJ), in Mercier's Federal Rail
Safety Act (FRSA) retaliatory termination action. We deny the petition for review
and affirm the ARB's final decision and order.
I. BACKGROUND
The following facts were developed at the three-day hearing in front of the
ALJ. Mercier worked for Union Pacific Railroad (UP) in Valley Park, Minnesota, for
a number of years. Mercier was an engineer, trainer, and union representative, and
in the course of representing employees for the union during disciplinary hearings,
and at other various work times, Mercier pointed out a number of perceived safety
violations throughout his employment at UP. Mercier believes this ongoing practice
of reporting safety violations brought him within the ire of management, and he
alleges that he was unfairly disciplined on a number of occasions. Some of these
disciplinary actions were overturned when reviewed by a neutral board at a later time.
Mercier's superintendent testified that Mercier did indeed report on a number of
safety violations but that UP generally responded to Mercier's safety reports in an
effort to keep the workplace safe. The superintendent also noted that Mercier had,
on occasion, been recognized and rewarded for his safety reporting.
In June 2007, Mercier exchanged a series of text messages with coworker
Michael Thomas. Mercier alleges the substance of the texts was regarding the rumor
that Thomas was involved in an extramarital affair with a female coworker, Deana
Symons. Symons, on the other hand, alleged that shortly after she was hired as a
student conductor in March 2007, Mercier began speaking to coworkers about her
and insinuated that she was having sexual relations with several coworkers. Thomas
showed Symons the texts he had received from Mercier. While the exact content of
the texts is not in the record, both Thomas and Symons testified that the essence of
the messages was that Mercier asked who was "doing the student" and offered to buy
that person some "sex powder." Symons contacted Mercier directly to tell him that
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she considered his conduct to be harassing, and that he should stop. Shortly
thereafter, in early July 2007, Symons also reported the text-messaging incident to the
Equal Employment Office (EEO) hotline. Mercier contends he was merely trying to
ward off the workplace strife that might ensue due to the alleged extramarital affair
between Thomas and Symons. The UP EEO manager, Melissa Schop, investigated
and confirmed the existence of the offensive text messages.
UP subsequently charged Mercier with an EEO violation and removed him
from service, which was effectively a suspension, pending the outcome of an
investigation and EEO hearing. During his suspension, Mercier went to Symons's
home and took photos of Thomas visiting her house. Thomas and Symons both
testified that Thomas was there to help Symons prepare for the upcoming EEO
hearing. Symons testified that Mercier's "drive by" left her feeling scared and
frightened, and she was unsure how Mercier had discovered where she lived.
Before the EEO hearing could take place, Mercier's union representative and
Mercier's superintendent struck a deal allowing Mercier to return to work as long as
he signed a "waiver" agreement. The conditions of this agreement were that Mercier
admitted violating the EEO policy, and agreed that if he had any future EEO
violations, he would waive a hearing and be immediately terminated. Mercier was
also required to take an EEO class, write Symons an apology, and refrain from
discussing the underlying EEO incident while at work or in any way retaliating
against her or Thomas. Thus, after a thirty-day unpaid suspension and meeting the
preconditions, Mercier returned to work in August 2007.
Symons expressed displeasure upon finding out that Mercier would return to
work. Symons objected to Mercier's "apology" which she felt was not sincere, as the
apology did not express acceptance of responsibility, but instead only expressed
remorse at being caught. The leader of Mercier's EEO training session also told
Schop that Mercier's attitude and statements at EEO training were a concern. In mid-
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October, Mercier told another UP employee that Thomas had showed him (Mercier)
a pair of Symons's underwear and Mercier commented on the size and color of the
underwear. This employee asked Thomas if this was true, and Thomas denied having
shown Symons's underwear to Mercier or anyone else. This employee ultimately
reported the incident to Schop. Also in October, Symons reported to Schop that yet
another coworker told her Mercier was complaining that Symons had falsely accused
Mercier of harassment. Schop contacted this coworker via telephone, and the
coworker confirmed what Symons had told Schop. During the month of October
2007, Symons made phone calls and sent emails to Schop detailing her strong
concern with Mercier's actions in the workplace, and her growing fears of him.
Thomas reported to Schop that Mercier had been calling him a rat, and noted a
derogatory message posted to the union website which obliquely referenced the
summer EEO incident wherein Mercier was suspended.
Schop testified that while investigating whether a violation of Mercier's waiver
agreement had occurred, she became increasingly concerned about Symons's anger
and frustration with UP over the handling of the situation. Schop stated that her
number one concern was that the work environment was free of discrimination and
retaliation for both Symons and Thomas. Also, Schop feared that Symons would
ultimately hire a lawyer and file suit against UP if it did not take prompt effective
action to remedy known harassment. Because the actions UP had previously taken
against Mercier did not seem to work, and because she believed Mercier had violated
the waiver agreement, in late October, Schop determined that UP needed to terminate
Mercier's employment.
On November 5, 2007, UP officially terminated Mercier for violating the
waiver agreement. Mercier contested the dismissal through the union procedures, and
a collective bargaining agreement (CBA) arbitration was scheduled about the matter.
Although UP's counsel was concerned about the strength of UP's arbitration case,
counsel testified that there were three reasons why UP defended the arbitration (rather
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than simply returning Mercier to work): it believed Mercier committed retaliation in
violation of the waiver agreement; it wanted to support female workers like Symons;
and it was concerned Symons herself would file an EEO charge against the company
if Mercier continued on the job. Ultimately, the arbitrator ruled in favor of Mercier,
who returned to work, after all of the arbitration proceedings and appeals, on April
1, 2010.
On March 27, 2008, before his eventual reinstatement, Mercier filed the current
FRSA complaint with Occupational Safety and Health Administration (OSHA),
alleging that his termination for violating the waiver agreement was really a pretext
for retaliation against him for the numerous times he reported safety issues. OSHA
dismissed the complaint, finding that a preponderance of the evidence indicated that
Mercier's protected activity was not a contributing factor in the incident. Mercier
appealed this ruling and requested a hearing in front of an ALJ. UP moved for
summary decision because some of the protected activity at issue in this case occurred
before the latest (August 3, 2007) amendments to the FRSA,1 and thus UP argued that
Mercier was barred from pursuing both the FRSA complaint and the CBA labor
arbitration, and due to lack of jurisdiction. The ALJ denied this motion, finding that
since termination occurred after August 3, 2007, there was jurisdiction over the
action, and because of the amendments, Mercier was not required to elect between
remedies. Further, because of FRSA's 180-day statute of limitations, 49 U.S.C. §
20109(d)(2)(A)(ii), Mercier could only challenge his termination (and not any of the
1
In 2007, Congress amended the FRSA to include additional categories of
protected conduct; changed the election-of-remedies language to state that an
employee cannot seek protection under both the whistleblower section and another
section for the same discriminatory conduct; and also as relevant here, specified that
nothing in the FRSA preempts or diminishes the rights of employees and that the
rights provided by the FRSA cannot be waived. 49 U.S.C. § 20109. Thus, § 20109
permitted Mercier to pursue his whistleblower claim concurrently with the CBA
grievance.
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earlier discipline) because he filed his petition in March 2008. The 180-day period
extended back only to September 2007. However, the ALJ specifically found that
while most of the protected acts of safety violation reporting occurred prior to the
180-day time frame, these acts of safety reporting were relevant and admissible
because the acts provided a complete picture of the relationship between UP and
Mercier and whether Mercier was discriminated against due to his protected activity.
The ALJ conducted a three-day trial on the merits of Mercier's retaliation
claim, and thereafter issued a 28-page decision finding that Mercier failed to prove
that his protected activities were a contributing factor in his termination. Mercier
sought review before the ARB, which affirmed the ALJ's decision. Mercier appeals,
arguing that the ALJ wrongly excluded evidence outside of the 180-day statute of
limitations, admitted hearsay evidence, and erroneously applied the contributing-
factor test.
II. DISCUSSION
Our review of the ARB decision is governed by the Administrative Procedure
Act (APA). See 5 U.S.C. § 706(2) (APA standard of review); 49 U.S.C. §
20109(d)(4) (FRSA provision linking judicial review to the APA standards). Under
this deferential standard, we must affirm the ARB's decision unless it is unsupported
by substantial evidence or is "arbitrary, capricious, an abuse of discretion, or
otherwise contrary to law." Maverick Transp., LLC v. U.S. Dep't of Labor, 739 F.3d
1149, 1153 (8th Cir. 2014). We cannot substitute our judgment for the agency's and
in considering the entire record, must affirm if substantial evidence supports the
decision. Id. "Substantial evidence is less than a preponderance, but enough that a
reasonable mind would find it adequate to support the ALJ's decision." Gonzalez v.
Barnhart, 465 F.3d 890, 894 (8th Cir. 2006). In reviewing the record, we consider
evidence that both supports and detracts from the ALJ's decision, but will uphold the
decision "if it is supported by substantial evidence on the record as a whole even if
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more than one conclusion could be drawn from the evidence." Id. We give "great
deference" to the ALJ's credibility determinations, and review an ALJ's evidentiary
rulings under an abuse-of-discretion standard. Wright Elec., Inc. v. NLRB, 200 F.3d
1162, 1166, 1168 (8th Cir. 2000).
The FRSA protects railroad employees from discharge or other discrimination
in retaliation for, in relevant part, reporting hazardous safety conditions or refusing
to work when confronted by a hazardous safety condition. See 49 U.S.C.
20109(b)(1); Kuduk v. BNSF Ry. Co., 768 F.3d 786, 787 (8th Cir. 2014). Under the
FRSA whistleblower rubric, a plaintiff must demonstrate, by a preponderance of the
evidence, that (1) he engaged in a protected activity; (2) the railroad employer knew
or suspected that he engaged in a protected activity; (3) he suffered an adverse action;
and (4) the protected activity was a contributing factor in the adverse action. See 29
C.F.R. 1982.104(e)(2); Kuduk, 768 F.3d at 789. A contributing factor is one which,
alone or in combination with other factors, has affected the outcome of the employer's
decision. Kuduk, 768 F.3d at 791. If the plaintiff makes this showing, the burden
shifts to the employer to show by clear and convincing evidence that it would have
taken the same adverse action absent the protected activity. Id. at 789. The ALJ
found that Mercier did not make a prima facie case in the first instance, and therefore
did not shift the burden to UP to show by clear and convincing evidence that it would
have terminated Mercier's employment absent the protected activity.
A. Statute of Limitations
The FRSA provides that actions "shall be commenced not later than 180 days
after the date on which the alleged violation" occurred. 49 U.S.C. §
20109(d)(2)(A)(ii). Because Mercier filed his complaint with OSHA on March 27,
2008, the ALJ correctly found that any adverse employment action that occurred prior
to September 29, 2007, would not be actionable due to the operation of the statute of
limitations. It is beyond dispute that the adverse employment action complained of
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here, Mercier's termination in November 2007, occurred after the operative cutoff
date. On the other hand, Mercier's initial suspension in July 2007 falls outside of the
reach of the statute and is not independently actionable. The ALJ nonetheless noted
that Mercier's protected activity leading up to the July 2007 suspension, which
ultimately led to his termination, was certainly relevant because it "provides a
complete picture of the relationship between [Mercier] and [UP] and whether
[Mercier] was discriminated against because of his protected activity." The ALJ thus
correctly applied the background evidence rule enunciated by the Supreme Court in
National Railroad Passenger Corp. v. Morgan, 536 U.S. 101, 113 (2002) (holding that
employee can use prior acts as background evidence for a timely claim even when
those same acts are time-barred).
Undeterred, Mercier vehemently contends that the ALJ failed to consider
evidence that occurred prior to September 29, 2007. Despite Mercier's repeated
arguments to the contrary, we find that the ALJ correctly applied the principles of
Morgan by considering all of the relevant actions that occurred prior to, and after,
September 2007 in evaluating this case. In the prehearing order addressing the
admissibility of time-barred acts, the ALJ appropriately held that even though
untimely instances of alleged retaliatory conduct were not actionable, they were
nonetheless relevant. Indeed, the ALJ findings tell the entire story of what happened
in this case; almost all of the facts detailed in the ALJ's order occurred before
September 2007. Only after the ALJ thoroughly discussed Mercier's extensive safety
reporting history, and the history surrounding Mericier's first interaction with
Symons, the text messages to Thomas, and the July suspension and reinstatement, did
the ALJ discuss post-September 29, 2007, conduct and the only cognizable
employment action–Mercier's firing in November 2007. Thus, we find that the ALJ
appropriately and adequately considered all of the relevant evidence in this case,
regardless of when it occurred.
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B. Hearsay Evidence
Mercier next argues that the ALJ improperly relied upon hearsay testimony,
referring primarily to Symons's and Schop's testimony that a coworker related that
Mercier continued to speak ill of Symons and Thomas even while subject to the
waiver agreement. Over Mercier's objection, the ALJ found that Symons's and
Schop's testimony was not offered for the truth of the matter asserted, but for the
effect the information had on Schop's decision to terminate Mercier. Mercier
complains that Symons and Schop related double hearsay that was contradicted by
direct evidence, because the coworker Symons referred to also testified at the hearing
in front of the ALJ. At the outset, we disagree with Mercier's characterization that
the alleged hearsay evidence was contradicted by the coworker's direct evidence.
This coworker testified that while training, he rode with Mercier and heard about the
original June-July EEO incident. A time later, he rode with Symons and again heard
about the EEO incident. His recollection of either conversation can be described as
sketchy at best, and his testimony covers eight pages in a transcript that filled nearly
600. Further, any statement Mercier initially made to the coworker is not hearsay
because it is an admission by a party opponent.2 29 C.F.R. § 18.801(d)(2)(i).
Nonetheless, the primary reason we reject this particular argument is because
Schop's and Symons's testimony about what the coworker said was not offered to
prove the truth of the matters asserted, but instead, to show the effect of the
coworker's assertions on Schop. See Simpson v. Beaver Dam Cmty. Hosps., Inc., 780
F.3d 784, 796 (7th Cir. 2015) (holding that a negative reference from an anonymous
staff member was not considered for its truth in employment discrimination case, but
instead was offered for its effect on the employment decision-makers). As we will
2
While the federal Rules of Evidence do not apply in administrative hearings,
administrative regulations promulgated by the Secretary of Labor set forth regulations
on the admission of hearsay evidence similar to those in the federal rules. See 29
C.F.R. §§ 18.801-18.806.
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discuss below, this incident was part of a culmination of incidents which induced
Schop to believe, rightly or wrongly, that Mercier had violated the waiver agreement.
Schop testified that the coworker originally confirmed Symons's version of the
events, and this confirmation, in addition to other factors, led Schop to believe that
Mercier had violated the waiver agreement and needed to be fired. The fact that the
coworker testified at the hearing and did not tell the same story does not diminish the
significance of Schop hearing about the incident in October 2007. Accordingly, we
reject Mercier's argument that hearsay evidence at the hearing undermines the ALJ's
ultimate conclusions.
C. Contributing Factor
Mercier next argues that the ALJ misapplied the contributing-factor test,
arguing that the ALJ required him to prove that the termination would not have
occurred absent the safety reporting. In making this argument, Mercier points to the
following statement in the ALJ's decision: "[Mercier] argues this termination was
pretextual, that is, he was fired because of his protected activity not because he
violated [UP's] EEO policy." But this quote is not the ALJ's statement of the legal
standard; it is the ALJ's summary of Mercier's arguments. Instead, in the "Governing
Law" section of the decision, the ALJ correctly notes that retaliation must be "a"
contributing factor, and again in coming to its conclusion, the ALJ found that Mercier
did not show retaliation was "a" contributing factor.
Nor does the ALJ's analysis otherwise indicate that it held Mercier to the wrong
standard of causation. In making the contributing-factor argument, Mercier again
resorts to the argument that the ALJ wrongly refused to consider actions outside of
the statute of limitations time frame. As noted above, we reject Mercier's arguments
in this regard. Further, substantial evidence in the record supports the ALJ's
determination that Mercier could not make out a prima facie case because he did not
show that his protected activities were a contributing factor in his termination. In
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deciding this, we pay particular attention to the procedural posture of this case, on
review of a final decision of the ARB, reviewing for substantial evidence the ALJ's
decision after a three-day hearing.3
The ALJ relied heavily upon Schop's testimony regarding Symons's
increasingly distressed communications with the EEO department in October,
following Mercier's return to work in August. Schop testified that her concern over
Symons's communications, coupled with the reports about Mercier's comments to the
coworker about Symons's accusations, and the underwear comments, convinced her
that Mercier had violated the waiver agreement and that she needed to terminate him
based upon that violation. As earlier noted, Schop was concerned about a
corresponding lawsuit from Symons. The ALJ repeatedly cited Schop's testimony
about her reasons for terminating Mercier, which amounted to a credibility finding
which we give "great deference." Wright, 200 F.3d at 1166.
The fact that Mercier was eventually cleared by the CBA arbitration process
and has returned to work at UP has no bearing on whether the November 2007
termination was in retaliation for reporting safety violations. See Kuduk, 768 F.3d
at 792 (concluding, at the summary judgment stage, that "[i]n the absence of evidence
connecting his protected activity to the discharge, Kuduk is not entitled to FRSA anti-
retaliation relief even if BNSF inaccurately concluded that he committed" a safety
violation). Rather, the issue is whether substantial evidence supports the ALJ's
conclusion that Schop terminated Mercier based upon her conclusion, accurate or not,
that he violated the waiver agreement and that his safety reporting was not a
contributing factor in that decision. Substantial evidence supports the ALJ's
conclusion that Schop did indeed determine that Mercier's conduct violated the
3
Indeed, the ALJ denied UP's motion for summary affirmance, instead finding
there were material facts needing to be resolved regarding whether Mercier's
protected activity was a contributing factor in his termination.
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waiver agreement without considering any safety reporting issues. Mercier's
arguments in favor of retaliation focus on an alleged pattern of retaliatory conduct
meant to get rid of him as an employee. This assertion is belied, however, by the deal
that was struck shortly after the June 2007 suspension wherein Mercier was allowed
to return to work without the EEO hearing. The ALJ made a finding in this regard,
stating that the superintendent's "willingness to reinstate" Mercier just a few months
earlier was "inconsistent with [Mercier's] argument that [UP] was using the EEO
policy as a pretext to get rid of him." We find that the ALJ's determination that
Mercier's protected acts were not "a" contributing factor in his termination is, indeed,
supported by substantial evidence.
In addition, although the ALJ did not make a specific finding in this regard,
Mercier likely also could not meet the second prong of the prima facie case–the
knowledge prong. Schop testified that she did not know about Mercier's safety
reporting, and she made the decision to terminate without the superintendent's input.
The superintendent likewise testified that it was the EEO department that made the
decision to fire Mercier. The safety department's knowledge is not imputed to the
EEO department; there must be some evidence connecting the two. See id. at 791-92
(noting that the incident which got the employee fired "was completely unrelated to"
his FRSA reporting). Here there was no such connecting evidence, and indeed, the
ALJ did make a finding that it was Schop's, and not the superintendent's, decision to
terminate Mercier. Substantial evidence supports this finding, and thus, Mercier also
cannot establish that the decision-maker for his termination had the requisite
knowledge of his safety reporting. See id. at 790-91 (holding that an FRSA violation
was an intentional tort requiring discriminatory animus, and cannot be committed
unwittingly).
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III. CONCLUSION
We deny the petition for review and affirm the ARB's final decision and order.
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