Employment Alert: Sixth Circuit Upholds Employer's Right to Deny an Employee a Promotion, Even After Employee's Safety Complaints

On March 29, 2011, the Sixth Circuit decided Hoffman v. Solis, Case No. 08-4128, a retaliation case brought after a pilot was allegedly denied a promotion in response to his safety complaints. Mark Hoffman claimed NetJets Aviation, Inc. violated the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (AIR 21), 49 U.S.C. § 42121, by failing to promote him to the position of initial operating experience instructor. Hoffman claimed that the promotion was denied in retaliation for safety reports he made to the Federal Aviation Administration (FAA). While the Court agreed that the complaints were protected activities under AIR 21, NetJets proved that they would have denied Hoffman's promotion even in the absence of his safety complaints.

Facts of the Case

Hoffman cited several incidents where he reported safety concerns such as fuel leaks and worn nose avionics bay latches, but there was no evidence that any retaliatory actions were taken after these reports. The most significant issue occurred in mid-July 2004 when Hoffman refused to carry non-essential personnel on a maintenance ferry permit flight because the pilots were not part of Hoffman's crew. Hoffman contacted the local FAA office and was given permission to ferry the crew. Hoffman was suspended for three days for "unprofessional conduct" after this event but was awarded back pay for the missed work after filing a grievance.

In May 2004, NetJets posted an announcement for instructor openings, a position Hoffman had previously applied for over twenty-five times. Thirty pilots applied and seven were hired; Hoffman was not one of them. In August 2004, Hoffman filed a grievance with the Systems Board of Adjustment (SBA), created by Congress to resolve minor disputes between employers and their employees. The SBA found no violation of the collective bargaining agreement, but recommended NetJets personally interview Hoffman for the position. Although not required to, NetJets complied with SBA's recommendation and the four-member interviewing panel unanimously agreed that Hoffman should not be promoted.

Hoffman then filed a complaint with the Occupational Safety and Health Administration (OSHA) alleging that NetJets violated AIR 21 by failing to promote him as retaliation for his prior safety complaints. After investigating, OSHA denied Hoffman's complaint, and Hoffman requested a hearing before an Administrative Law Judge (ALJ). The ALJ found that Hoffman engaged in protected activities and that his denial of a promotion was an adverse action under AIR 21, but NetJets established by clear and convincing evidence that it would have denied Hoffman the instructor position even without Hoffman's protected activity. On appeal, the Administrative Review Board (ARB) affirmed the ALJ's decision. Hoffman then appealed to the Sixth Circuit.

What the Court Said

To establish an AIR 21 violation, Hoffman had to prove by a preponderance of the evidence that he engaged in protected activity, suffered an adverse action and that his protected activity was a contributing factor in the adverse action. The burden then shifted to NetJets to prove by the stricter clear and convincing standard that they would have taken the same action, regardless of Hoffman's complaints. On appeal, Hoffman challenged the ALJ's conclusion that NetJets met the clear and convincing standard.

Hoffman also argued that because NetJets had to meet the clear and convincing standard at the ALJ level, judicial review by the ARB should be conducted under the same standard, instead of the substantial evidence standard used by reviewing courts under the Administrative Procedure Act. The Sixth Circuit rejected Hoffman's argument, claiming that a deferential standard of review to a finding reached under a stricter standard is routine.

In reviewing the ARB's conclusions, the Sixth Circuit relied heavily on evidence that showed that all thirty candidates were evaluated using the same three-part point system and Hoffman ranked in the bottom five as well as on the fact that the interviewing panel's conclusion was unanimous and this decision was recorded in Hoffman's file. NetJets also indicated that Hoffman's lack of international flying experience was a key factor in his denial. Further, several managers testified that Hoffman interviewed poorly and declined to ask any questions on his own. The Sixth Circuit held that a reasonable person could conclude from the record that Hoffman was denied the position because of his faults as a candidate, not because of his protected activities.

Recommendations For Employers

The court's decision underscores the importance of keeping records - having a discrete, point-based system provided easy evidence for the court to rely on when determining if Hoffman was indeed qualified for the job. In addition to clear record-keeping procedures, employers should have a compliance plan in place that allows top-level management to quickly learn of complaints and to investigate and remediate any problems.

While employers can breathe a little easier after this decision, it is also important to remember that almost twenty statutes now have whistleblower and retaliation provisions, so employers should be aware of rights afforded to employees under these statutes. With increased funding allotted for OSHA to enforce these provisions, managers and supervisors need to be properly trained to recognize protected activities and to react accordingly.

For more information regarding whistleblower laws and regulations or assistance with drafting or revising whistleblower policies, procedures and managerial training programs, please contact Mary E. Pivec at 202-434-4212 or pivec@khlaw.com, Manesh K. Rath at 202-434-4182 or rath@khlaw.com, or Amy L. Blackwood at 202-434-4118 or blackwood@khlaw.com.

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