Appeals court finds against Cloud Peak unit in employee safety case

The U.S. Tenth Circuit Court of Appeals has rejected an appeal by Cordero Mining LLC, a unit of Cloud Peak Energy (NYSE: CLD), in a worker discrimination case and affirmed a December 2011 decision by an administrative law judge of the Federal Mine Safety and Health Review Commission.

In that decision, the judge ordered Cordero Mining to reinstate a discharged employee to her former position, make her whole for lost wages and benefits, remove from her personnel files references to the unlawful discharge and pay a civil penalty of $40,000, the U.S. Mine Safety and Health Administration said in a Dec. 4 statement.

In May 2010, Cindy Clapp, a shovel operator with 28 years of experience as a miner, filed a complaint with the commission alleging that Cordero terminated her employment in retaliation for her repeated safety complaints. Clapp claimed that her unlawful discharge had a chilling effect on the willingness of other miners to raise safety issues at the mine.

MSHA sought a finding from the commission that Cordero unlawfully discriminated against an employee in violation of Section 105(c) of the Federal Mine Safety and Health Act of 1977, which states that miners, miners’ representatives and applicants for employment are protected from retaliation for engaging in safety and/or health-related activities, such as identifying hazards or asking for MSHA inspections.

In December 2011, an administrative law judge of the commission concluded that Clapp had engaged in protected activities under the Mine Act, and that Cordero had discharged her in retaliation for her activities. Cordero then filed an appeal with the commission, which declined to review the judge’s decision. Cordero then filed an appeal with the U.S. Tenth Circuit Court of Appeals.

In its Nov. 15 decision, the appeals court found substantial evidence to support the administrative law judge’s finding of discrimination and his decision to award full back pay, MSHA noted. In addition, the court found that the $40,000 penalty was not excessive or an abuse of discretion. Cordero has until Dec. 31, 2012, to petition the court for a rehearing.

“This decision represents a resounding victory for miners and their right to identify hazardous conditions that imperil themselves and their fellow miners without fear of reprisal,” said Joseph Main, the head of MSHA.

During fiscal year 2012, MSHA said it filed 39 requests – more than in any other year – with the commission for temporary reinstatements on behalf of miners who submitted complaints of discrimination in the form of a suspension, layoff, discharge or other adverse action.

Clapp complaints had to do with haul truck positioning

“Beginning in early 2009, Ms. Clapp lodged several safety complaints with Cordero,” said the Nov. 15 appeals court decision by a three-judge panel. “In February and July 2009, Ms. Clapp voiced concerns about newly-installed GPS screens blocking visibility inside vehicles. In March or April 2009, Ms. Clapp complained about unmanned vehicles being parked behind her shovel. Throughout 2009, Ms. Clapp voiced concerns about needing water trucks in her run because dust was decreasing visibility to dangerous levels.”

The decision added: “Most relevant, Ms. Clapp expressed concerns about overloaded trucks returning to the run to dump their loads. As background, in late 2008 and early 2009, Cordero equipped its trucks with an updated pay load monitoring system, which calculated the weight of the coal load. On March 1, 2010, Cordero installed governors – or speed regulators – on its trucks. The governors prevented a truck from traveling at greater than five miles per hour once the truck registered as overloaded. At a meeting held on March 2, 2010, Dave Robinson, a supervisor for Ms. Clapp’s team, told the team about the governors and instructed them on the new policy – if the governor was triggered, they should turn the truck around and dump it back at the coal face.”

The decision continued: “Beginning that night and continuing until March 12, 2010 – just six days before she was terminated – Ms. Clapp expressed concerns about the new policy to various Cordero employees, including Robinson, mine manager Joe Vaccari, Rotating Operations Supervisor (‘ROS’) Terry Oistad, and ROS Gerald Fischer. Ms. Clapp asserted that having trucks return to the run to unload was dangerous based on uneven terrain and the potential for truck congestion. Ms. Clapp was called into meetings – one in particular on March 10, 2010 – at which she alleges she was berated and chastised for continuing to voice safety concerns. On the morning of March 11, 2010, Ms. Clapp called her supervisors to let them know she was taking a ‘floater’ day and would not be coming into work. Cordero alleges that Ms. Clapp knew a meeting was scheduled for that day. Ms. Clapp ultimately was terminated on March 18, 2010 ‘due to [her] insubordination towards leadership and for other legitimate business reasons.’”

Court rejects Cordero’s arguments all the way down the line

Cordero challenged the ALJ’s finding that Clapp engaged in protected activity. “We disagree, and find substantial evidence in support of the ALJ’s findings,” said the appeals court decision. “In concluding that Ms. Clapp engaged in protected activity, the ALJ described seven incidents in March 2010 when Ms. Clapp raised safety concerns about turning around and dumping overloaded coal trucks back at the coal face. The evidence relied upon by the ALJ fully supports the conclusion.”

Cordero also challenged the ALJ’s finding that Clapp was terminated for her protected activity. Cordero argued that substantial evidence shows that Clapp was terminated for insubordination instead. “Once again, we disagree,” the court said. “The ALJ reviewed the evidence in the record from which a court could infer Cordero fired Ms. Clapp for her protected activity, i.e. knowledge of the protected activity, animus, temporal proximity, and disparate treatment. The ALJ then evaluated Cordero’s allegations of insubordination – that Ms. Clapp failed to attend a March 11 meeting – and found them to be pretext. Here, the ALJ made several credibility determinations in deciding to believe the testimony of Ms. Clapp regarding the alleged March 11th meeting instead of Fischer, and these decisions are entitled to deference.”

Cordero also challenged the ALJ’s decision to award full back-pay to Clapp. Cordero contended that the ALJ ignored substantial evidence that Clapp failed to mitigate her damages, specifically that Clapp only applied for one job after being terminated. “We disagree,” said the court. “A claimant is entitled to full back pay so long as she makes a ‘reasonable and good faith effort’ to mitigate damages and find new employment.”

Cordero also argued that the civil penalty imposed is excessive and not supported by substantial evidence. An ALJ is authorized to determine the amount of the civil penalty, as long as the ALJ considers six criteria, the court wrote.

Cordero contended that the ALJ ignored certain statutory factors, and that substantial evidence does not support the ALJ’s finding that Clapp’s termination had a chilling effect on other miners, and Cordero did not act in good faith. “We disagree,” the court opinion said. “The ALJ considered each of the six statutory elements relating to civil penalties, and ultimately focused on the second, third, fifth, and sixth factors. Here, the ALJ found that Cordero was a large mining company, that Cordero’s managers were negligent, that discharging Ms. Clapp was a grave violation that had a ‘chilling effect’ on other miners, and that Cordero did not act in good faith. We find substantial evidence for each of these factual findings.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.