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USDOL/OALJ Reporter
Stultz v. Buckley Oil Co.,
93-WPC-6 (Sec'y June 28, 1995)
DATE: June 28, 1995
CASE NO. 93-WPC-6
IN THE MATTER OF
DANIEL A. STULTZ,
COMPLAINANT,
v.
BUCKLEY OIL COMPANY,
RESPONDENT.
BEFORE: THE SECRETARY OF LABOR
FINAL DECISION AND ORDER
This case arises under the employee protection provision of
the Water Pollution Control Act, 33 U.S.C. ¶ 1367 (1988)
(WPCA), and other environmental statutes with similar
provisions.[1] Complainant Daniel A. Stultz alleges that
Respondent Buckley Oil Company (Buckley) violated the
whistleblower provisions when it discharged him after he
notified the Environmental Protection Agency (EPA) of potential
violations of environmental statutes.[2] In a Recommended Decision and Order (R. D. and O.), the
Administrative Law Judge (ALJ) found that Stultz was a covered
"employee," and recommended dismissal because Stultz did not
sustain the burden of proving that Buckley retaliated against him
for engaging in activity protected by the whistleblower
provisions. The ALJ's summary of the evidence, R. D. and O. at
1-10, is well supported by the record and I adopt it. I agree
that Stultz was covered by the whistleblower provisions and that
the complaint should be dismissed. Accordingly, I adopt the
ALJ's R. D. and O. as modified below.
BACKGROUND
I will briefly outline the evidence relevant to the legal
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issues that I discuss below. Stultz sought a company to acquire
and run and sent a letter to that effect to Robert Hankins, a
certified public accountant. RX 1. Hankins knew that one of his
clients, the family-owned Buckley Oil Company, sought a
purchaser. Buckley buys chemical solvents and lubricants in
bulk, stores them, and sells them in smaller quantities.
Stultz identified himself as a management consultant. RX 3;
see also RX 2. Stultz, an experienced chemist and
executive in the oil industry, has degrees in chemical
engineering and business. RX 2.
Hankins arranged for Stultz to meet Buckley's principals,
Tom and Bess Buckley. As a result of the meeting, Hankins,
acting on behalf of Buckley, offered Stultz the position of Buckley's general manager, with the option of first refusal to
purchase the company after two years of employment. RX 6.
Stultz submitted a counter proposal concerning the
compensation for the general manager position. RX 7. He also
notified Buckley's principals that they might be required to file
a form with the EPA concerning toxic chemicals stored by the
company and informed them that he would consider a three month
consulting assignment at Buckley. RX 8. In a follow-up letter,
Stultz expressed concern that the company's waste water dikes
could spill over into the adjacent river and violate an
environmental law. RX 9. Stultz reiterated his concern about
potential violations of law in yet another letter. RX 10.
Stultz then proposed to work for Buckley for six months on a
"1099 fee basis" with the belief that the consulting assignment
"would logically evolve into full time employment. . . ." RX 10
at p. 5.[3] Buckley's principals found it difficult to hand
over control of the company to someone they did not know.
Consequently, they agreed to a four month consulting assignment
with a review of the agreement at the end of the four months.
T. 301, 305. It was clear that Stultz was not hired as an
employee. See RX 13, letter from Stultz to Tom and Bess
Buckley.
Buckley extended the consulting job for an additional, fifth
month, T. 305, while it considered making Stultz a new offer to
be employed as general manager. T. 307; see RX 14. Although
Stultz had provided useful sales analyses, Bess Buckley believed
that he had not been helpful in suggesting solutions to the
environmental problems he pointed out. T. 303, 305-306. Each
time that Ms. Buckley asked for a plan to resolve the problems,
Stultz said that he had not yet prepared it. T. 305. In
reviewing his work at the end of the fifth month, Bess Buckley
determined that Stultz "still really hadn't done anything" other
than assisting in sales analysis. T. 306.
Through Hankins, Buckley offered Stultz the General Manager
position at a base rate of pay lower than his consulting fee but
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with employee benefits included. T. 266, 307-308; see
also RX 15 p. 1. At a meeting with Hankins, Stultz turned
down the position and asked for time to make a counter proposal.
T. 167. Bess Buckley agreed to an additional month's extension
of the consulting arrangement "only if we see some results" from
Stultz. T. 309. Buckley expected Stultz to produce a written
plan to fix the company's problem with waste water. T. 310-311.
Buckley ultimately extended the consulting job for a sixth
month. T. 268, 311. Early that month, Stultz telephoned the EPA
to report that Buckley was pumping waste into the nearby river.
As a result, the EPA inspected Buckley's premises that day and
again at the end of the month. T. 47-48. The EPA did not reveal
who tipped them off about ongoing violations at Buckley Oil.
T. 314-317. Meanwhile, Stultz made a counter proposal concerning the
compensation package for the general manager position, RX 15,
which Buckley rejected. T. 273. Buckley informed Stultz on
February 26, 1992 that they were not able to come to agreement
and that the consulting position was ended. T. 276. After the
consulting job ended, Stultz for the first time produced a
written plan to resolve the water pollution problem at Buckley
Oil. RX 16.
DISCUSSION
Although Stultz characterizes the adverse action of which he
complains as a "discharge," there are two separate acts involved:
Buckley ended the consulting relationship with Stultz, and it
also did not hire him as general manager. Buckley contends that
Stultz was not an "employee" within the meaning of the
whistleblower provisions because he was an independent
contractor.
I agree with the ALJ that since Stultz "sought long term
employment" with Buckley, R. D. and O. at 12, he was protected by
the whistleblower statutes. Although the whistleblower
provisions cover only "employees," the Secretary has held that
this term is broad enough to cover applicants for employment.
Samodurov v. General Physics Corp., Case No. 89-ERA-20,
Sec'y Dec. and Order Nov. 16, 1993, slip op. at 6 (under Energy
Reorganization Act). Excluding job applicants from coverage
would contravene the purpose of the whistleblower provisions to
encourage the reporting of safety and environmental deficiencies.
Faulkner v. Olin Corp., Case No. 85-SWD-3, ALJ's Rec.
Dec., Aug. 16, 1985, slip op. at 14-15, adopted in Sec. Final
Ord., Nov. 18, 1985.
I adopt the ALJ's analysis and conclusion that Stultz's
internal complaints to Buckley's managers about potential
violations of the environmental acts constituted protected
activity of which Buckley was aware. See Willy v. The Coastal
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Corp., Case No. 85-CAA-1, Dec. and Order of Remand, June 4,
1987, slip op. at 3-4. Therefore, the issue becomes whether
Buckley ended the consulting relationship and declined to hire
Stultz in retaliation for his protected activities.
I agree with and adopt the ALJ's analysis that Stultz did
not establish by a preponderance of the evidence that Buckley
retaliated against him because he engaged in protected activity.
R. D. and O. at 14-15. Rather, I agree with the ALJ that:
Considering that the persons responsible for the
employment decision had no knowledge of the
Complainant's reports to the EPA at the time the
decision was made, considering that his internal
environmental complaints had been expressed prior to
his initial retention and prior to his extensions as a
'consultant to management,' and considering that part
of the reason for his being retained was to help fix
these problems, [Stultz] has failed to show that a
discriminatory reason more likely motivated Respondent.
R. D. and O. at 14-15. I find that Buckley had legitimate,
nondiscriminatory reasons for its actions because Stultz did not
produce any solution to the waste water problems during his six
month consulting assignment. Stultz's poor performance as a
consultant is the reason that the company did not extend his consulting contract further or accede to his salary demands for
the general manager position.
CONCLUSION
The complaint is DISMISSED because Stultz did not carry the
ultimate burden of persuasion that Buckley retaliated against him
because of his protected activities.
SO ORDERED.
ROBERT B. REICH
Secretary of Labor
Washington, D.C.
[ENDNOTES]
[1] Stultz filed his complaint under the WPCA and "all federal
laws which provide me with protection." The employee protection
provisions of the statutes will be referred to collectively as
the "whistleblower provisions."
[2] The ALJ found that the complaint also concerned the
whistleblower provisions of the Toxic Substances Control Act, 15
U.S.C. § 2622 (1988)(TSCA), and the Solid Waste Disposal Act
as amended by the Resource Conservation and Recovery Act, 42
U.S.C. § 6971 (1988) (SWDA).
[3] Although Stultz continued to express interest in buying the
company, the two parties never came to acceptable purchase terms.
Stultz proposed to buy Buckley Oil on credit, RX 13, and CPA
Hankins believed, and advised Buckley Oil, that the company
should be sold only for cash. T. 246-247.
