Image of ARB Narrows Extraterritorial Application of Airline Safety Whistleblower Protection Law

ARB Narrows Extraterritorial Application of Airline Safety Whistleblower Protection Law

Last week, Boeing whistleblower Ed Pierson courageously testified at a Congressional hearing about his warnings to Boeing managers to shut down the production line of the 737 MAX program.  He described inordinate pressure to produce planes, overworked employees, and problems obtaining parts.  Boeing leadership ignored his warnings, and approximately 300 people have died due to alleged design flaws in the Boeing 737 MAX.  The recent Congressional hearing about the Boeing 737 MAX also revealed that despite warnings from FAA employees about Boeing’s longstanding rudder design, FAA management decided to certify the 737 MAX.  The tragic deaths in Boeing 737 MAX crashes underscore the importance of robust protection for whistleblowers in the airline industry.

Earlier this month, however, the Department of Labor’s Administrative Review Board issued a decision in Shi v. Moog, Inc., ARB No. 2017-0072, ALJ No. 2016-AIR-00020 that narrows the reach of the AIR21 whistleblower protection lawShi affirms the ALJ’s dismissal of an AIR21 complaint on the basis that the employee worked for an air carrier outside the United States.

Citing Morrison v. Nat’l Australia Bank, Ltd., 561 U.S.  247 (2010), the ARB held that extraterritorial application of AIR21 hinges on the following factors:

1) whether the statute at issue applies extraterritorially, and if not,

2) whether the activity that is the focus of the statute occurred within the U.S.

Applying the first prong of the Morrison test to Shi’s claim, the Board held that Congress did not expressly authorize extraterritorial application of AIR21, and therefore it applies only domestically.  As for the second prong, the ARB found that Shi’s claim falls outside the ambit of AIR21 because Mr. Shi’s primary place of employment was in China, he was employed under a Chinese contract, and his employer was a Chinese corporation.  As the activity at issue in the case did not occur within the U.S., Mr. Shi cannot proceed with his AIR21 claim.

The Board also held that the key factor determining whether a claim is domestic or extraterritorial is the location of the employee’s principal worksite.  Even where an AIR21 complaint concerns alleged misconduct that occurred in the U.S. or the misconduct affects U.S. air carrier safety, the claim will be deemed extraterritorial if the employee’s principal worksite is outside the U.S.

Shi’s only alleged domestic contacts consisted of 1) taking a few work-related trips to the U.S., 2) alleging that some of the people responsible for the adverse action taken against him may be U.S. citizens, and 3) complaining about counterfeit parts that were used to manufacture aircraft flown in the U.S.  These alleged contacts were insufficient to create a domestic application of the AIR21 whistleblower protection law.

Disconcerting Approach to Statutory Interpretation

The result in Shi is not unexpected, but the ARB’s approach to statutory construction in Shi portends a troubling further erosion of whistleblower rights.  Without citing any relevant authority, the ARB concludes:

[“T]the primary focus of the employee protection provisions of AIR 21 are on the retaliatory adverse personnel action. While AlR 21’s overarching purpose may be to protect air carrier safety, that ‘meta-purpose is not dispositive of the question before us.’ . . . Rather, we look to the text of the statute and the primary focus of the employee protection provisions of AIR 21 itself.”

In other words, the ARB holds that it will ignore the purpose of the remedial legislation it is construing and instead construe the text of a whistleblower protection provision in isolation from the statute in which it is included.  That would be a radical departure from well-established DOL and federal court precedent broadly construing federal whistleblower protection laws.  See, e.g., Passaic Valley Sewerage Comm’rs v. Dep’t of Labor, 992 F.2d 474, 479 (3d Cir. 1993) (“The whistle-blower provision was enacted for the broad remedial purpose of shielding employees from retaliatory actions taken against them by management to discourage or to punish employee efforts to bring the corporation into compliance with the Clean Water Act’s safety and quality standards.  If the regulatory scheme is to effectuate its substantive goals, employees must be free from threats to their job security in retaliation for their good faith assertions of corporate violations of the statute. . .).

When former DOL Chief ALJ Stephen Purcell considered the extraterritorial reach of AIR21, he performed an exhaustive analysis of the purpose of AIR21 and in a well-reasoned opinion citing the purpose and legislative history of AIR21, reached the opposite conclusion of Shi:

Just as the predominant purpose of Section 806 of SOX is fraud detection, the predominant purpose of Section 42121 is detection of aviation safety hazards and airline non-compliance with FAA safety laws, rules and regulations . . . AIR21 provides an incentive  to  airline  workers which promotes  aviation safety  inasmuch as “it  provides  job  security . . . as  a means  of  encouraging employees voluntarily to take an action Congress deems in the public interest.”  Id. at 13.  . . . AIR21’s legislative history also indicates that AIR21’s whistleblower protection provision is just one of many aviation safety mechanisms in a statute that holds aviation safety as its preeminent goal.  For example, each time AIR21’s whistleblower provision was specifically mentioned during the congressional floor debates preceding the statute’s enactment, it was discussed as a mechanism for further ensuring aviation safety, and at no point did a legislator suggest that Section 42121’s purpose is to regulate labor conditions in the industry.  See, e.g., 146 Cong. Rec. S1247-07, S1252 (daily ed. March 8, 2000) (statement of Sen. Grassley) (“whistle-blower protection adds another, much needed, layer of protection for the traveling public using our Nation’s air transportation system.”); 146 Cong. Rec. S1255-01 at S1257 (statement of Sen. Hollings) (AIR21 includes “whistleblower protection to aid in our safety efforts and protect workers willing to expose safety problems.”); 146 Cong. Rec. H1002-01 at H1008 (statement of Rep. Boehlert) (AIR21 “provide[s]whistle-blower protection for both FAA and airline employees so they can reveal legitimate safety problems without fear of retaliation.”).

Dos Santos v. Delta Airlines, Inc., 2012-AIR-20 (ALJ Jan. 11, 2013) (emphasis added).  Based on his thorough analysis of the statutory scheme, Judge Purcell denied a motion to dismiss an AIR21 claim brought by a Delta aircraft maintenance technician working at Charles de Gaulle airport who alleged that he suffered retaliation for reporting to Delta and the FAA that his supervisor had falsified FAA aircraft safety clearance documents.  The whistleblower complained to U.S-based Delta officials and suffered retaliatory adverse actions that may be attributable to Delta’s management-level employees in the U.S.  Accordingly, Judge Purcell found that there was a substantial connection with the United States’ domestic aviation system and that enforcement of the complaint fits squarely within AIR21’s focus of ensuring aviation safety.  Under Shi, however, the claim would be dismissed.

Congress tasked DOL with the enforcement of approximately 24 whistleblower protection laws concerning workplace safety, transportation safety, environmental protection, fraud prevention, and other whistleblowing that promotes the public interest.  Contrary to the ARB’s unsupported and conclusory assertion in Shi, these whistleblower protection laws do not merely vindicate the employment rights of the whistleblowers bringing the claims and cannot be understood in isolation from the statutory schemes in which they were enacted.  Instead, enforcing these laws vindicates vital public interests, such as ensuring that a Boeing engineer can raise concerns to the FAA about defective parts, or a pilot can raise concerns about flying an unsafe plane.  Consistent with Congressional direction and well-established precedent, DOL should construe whistleblower protection laws in light of their remedial purpose.

Jason Zuckerman, Principal of Zuckerman Law, litigates whistleblower retaliation, qui tam, wrongful discharge, and other employment-related claims. He is rated 10 out of 10 by Avvo, was recognized by Washingtonian magazine as a “Top Whistleblower Lawyer” in 2015 and selected by his peers to be included in The Best Lawyers in America® and in SuperLawyers.

Katherine Krems represents employees in discrimination, sexual harassment, and whistleblower retaliation cases. She is focused on finding creative solutions and maximizing her clients’ recoveries. Prior to law school, she worked on policy reforms in Congress to strengthen the rights of workers, women, and marginalized groups.