Warden v. Dept. of Natural Resources , 2012 Ohio 3854 ( 2012 )

[Cite as Warden v. Dept. of Natural Resources, 2012-Ohio-3854.]
Court of Claims of Ohio
The Ohio Judicial Center
65 South Front Street, Third Floor
Columbus, OH 43215
614.387.9800 or 1.800.824.8263
www.cco.state.oh.us
RICHARD W. WARDEN
Plaintiff
v.
OHIO DEPARTMENT OF NATURAL RESOURCES
Defendant
Case No. 2011-01232
Judge Alan C. Travis
DECISION
{¶ 1} Plaintiff brought this action alleging age discrimination under R.C. 4112.14
and 4112.99. The issues of liability and damages were bifurcated and the case
proceeded to trial on the issue of liability.1
{¶ 2} Plaintiff is a registered professional engineer who was employed by
defendant for 29.5 years. On October 1, 2006, plaintiff accepted a two-year buyout and
retired from his position as a Natural Resources Engineer 4 in defendant’s Mineral
Resources Management (MRM) Division, after 31.5 years of state service. Plaintiff was
51 years old when he retired.
{¶ 3} Following plaintiff’s retirement, legislation was enacted that required
defendant to prepare an estimate of the cost to reclaim coal mining sites in the event
that the coal mining operator forfeited. To comply with the new legislation, defendant’s
MRM division was required to create a program that could perform such estimates. In
March 2007, MRM’s Division Chief, John Husted, contacted plaintiff to see if he would
1
Plaintiff’s February 28, 2012 motion to strike “defendant’s argument II” is DENIED.
Case No. 2011-01232 -2- DECISION
resume his employment with MRM on an intermittent basis in order to develop the
required program. Plaintiff agreed and he was awarded a one fiscal year, “1000-hour”
contract as an Engineer 4. Plaintiff was subsequently granted three additional 1000-
hour contracts.
{¶ 4} In the fall of 2009, MRM division officials began discussing whether to
create a full-time Natural Resources Engineer 3 position to perform the work that
plaintiff was performing under his intermittent assignments. During these discussions,
Husted and Susan Grant, plaintiff’s immediate supervisor, approached plaintiff and
asked him whether he would be interested in a full-time Natural Resources Engineer 3
position. On November 20, 2009, plaintiff informed Grant that he was interested in the
position. (Plaintiff’s Exhibit 22.)
{¶ 5} In early 2010, defendant posted a position for a full-time Engineer 3. On
February 24, 2010, plaintiff applied for the posted position. At the time of his
application, plaintiff was still working for defendant pursuant to his most recent 1,000-
hour contract. On March 31, 2010, Mamie Hollenback, defendant’s human resource
associate, mailed a letter to plaintiff notifying him that an interview had been scheduled
for him on April 29, 2010. However, according to Hollenback, prior to plaintiff’s
interview, she informed the interview panel that former employees who had retired could
not be rehired in a full-time position. Plaintiff’s interview went forward as scheduled. At
the conclusion of the interviews, plaintiff had earned the highest overall score.
{¶ 6} On May 5, 2010, Husted informed plaintiff that it was not likely that he would
be selected for the full-time position because he was a retiree. Grant and Lanny Erdos,
Deputy Chief of the Coal Regulatory Mine Safety and Industrial Minerals program, also
informed plaintiff that he would not be selected for the full-time Engineer 3 position
because the administration would not allow an individual who had retired from the
agency to be rehired into another full-time position. Plaintiff complained to Husted,
Case No. 2011-01232 -3- DECISION
Grant, and Erdos, that such a policy would result in the employment of a less qualified
individual. Plaintiff’s final day in defendant’s employment was June 5, 2010.
{¶ 7} Defendant eventually selected Jared Knerr for the Engineer 3 position.
Knerr was 39 years old when he was hired. Plaintiff was 54 years old when he learned
that he had been rejected for the full-time position. Plaintiff asserts that defendant’s
failure to hire him constitutes discrimination on the basis of age in violation of R.C.
4112.14 and 4112.99.
{¶ 8} R.C. 4112.14(A) provides: “No employer shall discriminate in any job
opening against any applicant or discharge without just cause any employee aged forty
or older who is physically able to perform the duties and otherwise meets the
established requirements of the job and laws pertaining to the relationship between
employer and employee.” In addition to Ohio case law, Ohio courts have consistently
looked to federal cases interpreting federal civil rights and age discrimination legislation.
Mauzy v. Kelly Scvs., Inc., 75 Ohio St.3d 578, 1996-Ohio-265; Barker v Scovill, Inc., 6
Ohio St.3d 146 (1983); Little Forest Med. Ctr. of Akron v. Ohio Civ. Rights Comm., 61
Ohio St.3d 607, 609 (1991), (“[T]his court concluded that the evidentiary standards
applicable to a determination regarding a violation of Title VII of the Civil Rights Act of
1964 were likewise operable with respect to ascertaining whether a violation of R.C.
Chapter 4112 has occurred.”)
{¶ 9} A plaintiff claiming age discrimination may proceed upon theories of
disparate treatment or disparate impact. Smith v. City of Jackson, 544 U.S. 228 (2005);
Adams v. Lucent Technologies, Inc., 284 Fed. Appx. 296 (6th Cir.2008). “To prevail on
a theory of disparate treatment discrimination, a plaintiff must prove that the protected
trait motivated his employer's decision. * * * To prevail on a theory of disparate impact
age discrimination, a plaintiff must prove that an employer's facially neutral policies or
practices fall more harshly on a protected group.” Caldwell v. Ohio State Univ., 10th
Dist. No. 01AP-997, 2002-Ohio-2393, ¶66. (Internal citation omitted.)
Case No. 2011-01232 -4- DECISION
DISPARATE TREATMENT
{¶ 10} Plaintiff’s claim of disparate treatment may be proven either by direct
evidence of discrimination or through the burden-shifting analysis set forth in McDonnell
Douglas Corp. v. Green, 411 U.S. 792 (1973), and Texas Dept. of Community Affairs v.
Burdine, 450 U.S. 248 (1981). See Harris v. Metro. Govt. of Nashville and Davidson
Cty., Tenn., 594 F.3d 476, 485 (6th Cir.2010).
{¶ 11} Plaintiff asserts that the testimony of former ODNR director Sean Logan
and a memorandum (Bates memorandum) authored by Human Resources Director
Steve Bates provide direct evidence of age discrimination. Defendant argues that it did
not hire plaintiff because of its policy prohibiting a retired former employee from being
rehired in the same or similar position; that his age was not a factor.
{¶ 12} Logan testified that the employment decision was motivated by a desire to
restrict the hiring of recently retired former employees and that plaintiff’s age was not a
consideration. Indeed, the Bates memorandum states that “[t]he re-employment of
State of Ohio/Public Employer Retirees will be strictly limited to intermittent positions
that require specialized knowledge and/or experience * * *.” The Bates memorandum
does not reference age as a factor for the policy. (Plaintiff’s Exhibit 27.) Accordingly,
the court finds that plaintiff has failed to present direct evidence of age discrimination.
{¶ 13} “To establish a prima facie case of age discrimination under the McDonnell
Douglas/Burdine framework, a plaintiff must establish: (1) he was at least forty years old
when the alleged discrimination occurred; (2) he applied for and was qualified for a
position for which the employer was seeking applicants; (3) despite his qualifications he
was rejected; and (4) the employer selected a substantially younger person for the
position. * * * If the plaintiff demonstrates a prima facie case, the burden shifts to the
defendant to articulate a legitimate nondiscriminatory reason for its decision. * * * Once
the defendant articulates a legitimate nondiscriminatory reason for its action, the burden
Case No. 2011-01232 -5- DECISION
shifts back to the plaintiff to establish that the defendant's ‘proffered reason was a mere
pretext for intentional age discrimination.’” Moore v. Abbott Labs., 780 F.Supp.2d 600,
610 (S.D.Ohio 2011), quoting id. (Internal citations omitted.)
{¶ 14} It is not disputed that plaintiff is a member of a protected class; that he was
qualified for the position; that he was rejected; and that defendant selected a
substantially younger person for the position. Defendant asserts that it nonetheless had
legitimate, nondiscriminatory reasons for declining to hire plaintiff.
{¶ 15} Logan testified that when he was at the age of 24, he was elected to the
Ohio House of Representatives for Columbiana County where he served for a period of
10 years. In 2001, he was elected as a Commissioner of Columbiana County and
served until 2007, when former Governor Ted Strickland appointed him to serve as the
Director of the Ohio Department of Natural Resources (ODNR). Logan testified that his
experience in the Ohio House and as a County Commissioner, taught him that public
employees and Ohio legislators often chose to retire from state service to begin
collecting their retirement benefits only to be rehired in the same or similar position.
Logan stated that this phenomenon was referred to pejoratively as “double-dipping.”
Logan asserted that “double-dipping” creates a “distrust with the public” and that in his
opinion, to retire means to leave the position. As a result, while at ODNR, Logan
instituted a policy prohibiting the rehiring of retired public employees in the same or
similar position.
{¶ 16} Additionally, the Bates memorandum states as follows: “The re-
employment of State of Ohio/Public Employer Retirees will be strictly limited to
intermittent positions that require specialized knowledge and/or experience. These
appointments should be for less than 1000, project driven and non-reoccurring.
Requests to re-employ retirees will be evaluated on the following criteria:
{¶ 17} “• Project (description)
Case No. 2011-01232 -6- DECISION
{¶ 18} “• Anticipated Project Duration (should be less than 10 pay periods & non-
reoccurring)
{¶ 19} “• Specialized Knowledge/Experience Required
{¶ 20} “• Specialized Knowledge/Experience of the Individual Requested
{¶ 21} “• What Other Options were Explored
{¶ 22} “The preceding rationale/criteria are based on the following:
{¶ 23} “• State of Ohio/Public Employer Retirees are already Receiving
Compensation
{¶ 24} “• High Unemployment Figures in the General Population in Most
Specialties
{¶ 25} “• Baseline Skills (Classification Minimum Qualifications) and OJT Should
Suffice in Most Cases due to Anticipated Project Duration
{¶ 26} “• Encourage Better Planning on the Part of the Respective Division/Office
Regarding Key Programs and/or Positions
{¶ 27} “Requests to re-employee [sic] a retiree will continue to be routed through
OHR; however these requests must be approved by your Deputy Director and the
Assistant Director.” (Plaintiff’s Exhibit 27.) Accordingly, the court concludes that
defendant has presented a legitimate, nondiscriminatory reason for not hiring plaintiff.
{¶ 28} Plaintiff argues that defendant’s policy prohibiting the rehiring of retirees to
the same or similar position was a mere pretext for intentional age discrimination. To
demonstrate pretext, plaintiff must prove either: “‘(1) that the proffered reason had no
basis in fact, (2) that the proffered reason did not actually motivate the [refusal to hire],
or (3) that the proffered reason was insufficient to motivate the [refusal to hire].’” Owens
v. Boulevard Motel Corp., 10th Dist. No. 97APE12-1728 (Nov. 5, 1998), quoting Frantz
v. Beechmont Pet Hosp., 117 Ohio App.3d 351, 359 (1996).
{¶ 29} Plaintiff was interviewed by Grant, Jason Craven, and Brent Heavilin.
Hollenback was also present for the interview but did not actively participate in
Case No. 2011-01232 -7- DECISION
questioning the candidate. Hollenback testified that prior to the interview she informed
the panel that they could not hire plaintiff for the position; however, Grant, Craven, and
Heavilin all testified that, prior to the interview, they were unaware of any policy
prohibiting the rehiring of retirees to the same or similar position and that they were
unaware of the existence of the Bates memorandum.
{¶ 30} Hollenback explained that she wrote “recently retired employee” on the
panel’s interview chart so that the panel would understand that plaintiff could not be
hired because he was a retiree. (Plaintiff’s Exhibit 9.) Hollenback testified that she was
informed of such a policy by her supervisor, Patti Nibert, who also instructed her not to
cancel plaintiff’s interview. Hollenback denied ever seeing the Bates memorandum.
{¶ 31} Grant, Craven, and Heavilin all testified that plaintiff received the highest
score on the interview. Craven and Heavilin both testified that they recommended
plaintiff for the position. Grant testified that she would have recommended plaintiff for
the position; however, after speaking with Erdos, her supervisor, regarding the position,
she was advised that the panel needed to consider the other three applicants for the
position because plaintiff could not be hired.
{¶ 32} Erdos testified that he spoke with Assistant Director, Richard Milleson, who
advised him that ODNR could not rehire a retired former employee. Erdos asserted that
he has never seen the Bates memorandum and that he was unaware of any policy
prohibiting the rehiring of a former employee who had retired. Husted, Erdos’s
supervisor, testified that he too spoke with Milleson regarding hiring plaintiff. According
to Husted, he was informed that the position could not be offered to plaintiff because he
was a recently retired former employee. Husted testified that he was unaware of any
policy prohibiting the rehiring of retired former employees and that he was unaware of
the existence of the Bates memorandum. Husted stated that Milleson did not object to
plaintiff’s potential hiring on any other basis.
Case No. 2011-01232 -8- DECISION
{¶ 33} According to Milleson, plaintiff had completed the tasks required of him
under the 1,000-hour contracts and the Engineer 3 position did not require plaintiff’s
expertise or skill set. Milleson testified that the administration preferred not the rehire a
retired former employee for the same or similar position, although he was unaware of
any such written policy while he was the assistant director.
{¶ 34} Although Logan testified that defendant had a policy prohibiting the
rehiring of retired former employees, he admitted that he never issued a directive to
memorialize the policy or a directive to distribute the policy to the division chiefs or
human resource staff. Logan asserted, however, that there were exceptions to such a
prohibition on rehiring formerly employed retirees. Logan stated that Thomas Tugend,
current Deputy Chief of MRM, was rehired despite having previously retired from a
similar position. Logan explained that exceptional circumstances necessitated
Tugend’s hiring. According to Logan, newly enacted legislation required additional
inspectors and a new regulatory structure in the oil and gas industry. As a result, Logan
determined that Tugend had the expertise necessary to oversee the expeditious
development of the new regulatory structure and ensure that it met public safety
requirements. Milleson testified that both he and Logan personally interviewed Tugend
and that he was the most qualified applicant for the position. Logan testified that the
Engineer 3 position did not have that same level of urgency and that he felt that the
department needed to look at other candidates. According to Logan, the Engineer 3
position could be filled by another person with some on the job training. Logan further
admitted that he did not discuss specific position duties for the Engineer 3 position when
presented with the possibility of hiring a retired former employee for the position.
{¶ 35} Based upon the forgoing, the court concludes that plaintiff has failed to
prove that defendant’s reason for not hiring plaintiff was a mere pretext for intentional
age discrimination. Indeed, the court is convinced by the testimony of Logan,
Hollenback, Husted, Erdos, and the members of the interview panel, that plaintiff was
Case No. 2011-01232 -9- DECISION
not hired solely because of his status as a retired former employee. Although the Bates
memorandum was not widely publicized and the position from which plaintiff retired was
not the same position for which he applied, Logan credibly testified that the reason why
plaintiff was not hired for the position was because of his status as a retired former
employee.
DISPARATE IMPACT
{¶ 36} “To establish a prima facie case of disparate impact, a plaintiff must: (1)
identify the ‘particular employment practice’; (2) show a disparate impact on a protected
group; and (3) prove that the employment practice caused the disparity.” Miller v.
Potash Corp. of Saskatchewan, Inc., Allen App. No. 1-09-58, 2010-Ohio-4291, ¶49,
citing Meacham v. Knolls Atomic Power Lab., 554 U.S. 84 (2008); Caldwell v. Ohio
State Univ., 10th Dist. No. 01AP-997, 2002-Ohio-2393. “[O]nce a plaintiff establishes a
prima facie case of disparate impact, the employer has the opportunity to rebut the
presumption of discrimination by producing evidence of a ‘business justification’ for its
‘neutral’ hiring criteria, or, under the ADEA, to demonstrate that the employer’s actions
were based upon a ‘reasonable factor other than age.’” Id., at fn. 11, citing Little Forest
Med. Ctr., supra and Meacham, supra; see also Shollenbarger v. Planes Moving &
Storage, 297 Fed. Appx. 483 (6th Cir.2008); Allen v. Highlands Hosp. Corp., 545 F.3d
387 (6th Cir.2008).2 “At that point, the burden shifts back to the plaintiff to show either
that the employer’s reason is a pretext for discrimination, or that there exists an
alternative employment practice, without the disparate impact, that also serves the
employer's legitimate interests.” Abbott v. Federal Forge, Inc., 912 F.2d 867, 872 (6th
Cir.1990); Dunnigan v. City of Lorain, 9th Dist. No. 02CA008010, 2002-Ohio-5548.
2
The Supreme Court of Ohio has not yet addressed a disparate impact age discrimination case.
Case No. 2011-01232 - 10 - DECISION
{¶ 37} Plaintiff has identified defendant’s policy prohibiting the rehiring of retired
former employees to the same or similar position as the potentially offensive
employment practice. Plaintiff testified that as a state employee he participated in the
Ohio Public Employees Retirement System (OPERS); that he accepted a two-year
buyout in 2006; and that he retired that same year with 31.5 years of state service
credit.
{¶ 38} R.C. 145.32 provides, in part, that “[a] member, who has passed his
sixtieth birthday and has five or more years of total service credit, or has twenty-five or
more years of total service credit and has attained his fifty-fifth birthday, or has thirty or
more years of total Ohio service credit, regardless of age, may file with the public
employees retirement board an application for retirement.”
{¶ 39} Given the above cited provisions, defendant’s prohibition against rehiring
retired former employees impacts only those prospective employees who are over the
age of forty.3 And, in this instance, the policy was the sole reason that plaintiff was not
hired for the Engineer 3 position. Accordingly, plaintiff has established a prima facie
case of disparate impact age discrimination.
{¶ 40} Logan testified that as a result of his service in the Ohio House and as a
County Commissioner, he developed the opinion that employees who retired from
public service should not be rehired in the same or similar position. Logan explained
that his experiences dealing with budget issues and his knowledge regarding the
negative public perception of alleged “double-dipping” motivated him to create the
policy. Logan testified that he viewed this subject as a “public trust issue.” According to
Logan, when a public servant retires, the public expects that person to leave the
position.
3
As a general rule, individuals under the age of fourteen are not allowed to work in Ohio. See
R.C. 4109.06 and 3331.01.
Case No. 2011-01232 - 11 - DECISION
{¶ 41} Logan stated that because of his experiences in the Ohio House and as
County Commissioner, he resolved to prevent “double-dipping” to the extent that he
could. As a result, while at ODNR, Logan instituted a policy prohibiting the rehiring of
retired public employees to the same or similar position, although he admitted that he
did not direct anyone to memorialize such a policy and that he did not distribute such a
policy to the management staff. Logan testified that he held meetings to discuss such a
policy; however, he admitted that the policy was not a specific agenda item at any
meeting and that there are no contemporaneous minutes memorializing discussions of
the issue.
{¶ 42} According to Logan, the Bates memorandum represents Bates’
understanding of the policy, but it is not itself his policy. Logan further admitted that the
department did not receive any negative publicity when it rehired Tugend to the same
position from which he had retired. Plaintiff testified that at no point did anyone inform
him that when he retired, he could no longer be rehired because of his status as a
retiree.
{¶ 43} Logan also admitted that while the term “double-dipping” has a negative
connotation, rehiring former retired employees to the same or similar position is both
legally permissible and may actually save the department money. In this instance,
plaintiff testified that he was paid $79,000 as an Engineer 4, but that he was willing to
accept the Engineer 3 position which had a salary of $58,000. Additionally, Erdos
testified that any other person hired for the Engineer 3 position would require 6-12
months of training just to reach plaintiff’s level of proficiency. Moreover, Erdos asserted
that not hiring plaintiff actually made the division less productive over a period of time.
Logan stated that he was unaware of, and did not consider, an assessment regarding
division productivity when making the decision not to rehire plaintiff for the Engineer 3
position. Furthermore, Logan admitted that he did not discuss specific job duties or
Case No. 2011-01232 - 12 - DECISION
qualifications in relation to plaintiff’s application for employment in the Engineer 3
position in order to determine whether an exception to the policy was warranted.
{¶ 44} The court concludes that defendant has failed to demonstrate that its
actions were based upon a reasonable factor other than age. Despite Logan’s
testimony that his policy promotes public trust, he acknowledged that he received no
negative publicity when he decided to rehire Tugend to the same position. Furthermore,
Logan acknowledged that “double-dipping” may actually save a department money.
Indeed, Erdos testified that any other person hired would require 6-12 months of
additional training to reach the level of productivity that plaintiff would have provided had
he been hired for the position and that by not hiring plaintiff, the division was actually
less productive. Thus, there is an absence of proof that the policy promotes public trust
in MRM.
{¶ 45} Moreover, each of the members of the interview panel testified that plaintiff
was the most qualified applicant for the position and received the highest interview
score. Grant acknowledged that Knerr received the third highest score on the interview.
Finally, Logan admitted that he was unaware of any productivity assessment by Erdos
regarding hiring for the Engineer 3 position and that he never had a discussion with
anyone regarding plaintiff’s qualifications for the position. In short, defendant has failed
to demonstrate that its actions were based upon a reasonable factor other than age.
Accordingly, judgment shall be rendered in favor of plaintiff.
Case No. 2011-01232 - 13 - DECISION
Court of Claims of Ohio
The Ohio Judicial Center
65 South Front Street, Third Floor
Columbus, OH 43215
614.387.9800 or 1.800.824.8263
www.cco.state.oh.us
RICHARD W. WARDEN
Plaintiff
v.
OHIO DEPARTMENT OF NATURAL RESOURCES
Defendant
Case No. 2011-01232
Judge Alan C. Travis
JUDGMENT ENTRY
{¶ 46} This case was tried to the court on the issue of liability. The court has
considered the evidence and, for the reasons set forth in the decision filed concurrently
herewith, judgment is rendered in favor of plaintiff. The case will be set for trial on the
issue of damages.
_____________________________________
ALAN C. TRAVIS
Judge
cc:
Case No. 2011-01232 - 14 - DECISION
Emily M. Simmons Merl H. Wayman
Randall W. Knutti 425 Metro Place North, Suite 420
Assistant Attorneys General Dublin, Ohio 43017
150 East Gay Street, 18th Floor
Columbus, Ohio 43215-3130
003
Filed April 4, 2012
To S.C. reporter August 24, 2012