Rail Worker Whistleblower Protection (FRSA)
The Federal Railroad Safety Act prohibits rail carriers from retaliating and discriminating against employees who, inter alia, reported violations of federal railroad safety laws or refused to work under hazardous conditions.
Congress enacted the FRSA whistleblower protection law to promote safety in every area of railroad operations and reduce railroad-related accidents and incidents. The FRSA whistleblower protection law is intended to address and rectify railroads’ history of systematically suppressing employee injury reports through retaliatory harassment and intimidation. See Araujo v. N.J. Transit Rail Operations, Inc., 708 F.3d 152, 156–57 & n.3, 159 & n.6 (3d Cir. 2013) Congress intended to “ensure that employees can report their concerns without the fear of possible retaliation or discrimination from employers.” H.R. Rep. 110-259, 248.”
Railroad Industry Protected Whistleblowing
The FRSA prohibits retaliation against a railroad employee who provides information to a regulatory or law enforcement agency, a member of Congress, or any person with supervisory authority over the employee about a reasonably perceived violation of federal law relating to railroad safety or security, or the abuse of public funds appropriated for railroad safety. In addition, the FRSA protects an employee who:
- refuses to violate a federal law, rule or regulation related to railroad safety or security;
- files a complaint under FRSA;
- notifies or attempts to notify the railroad carrier or Department of Transportation of a work-related personal injury or illness of an employee;
- cooperates with safety or security investigations conducted by the DOT, Department of Homeland Security, or National Transportation Safety Board;
- furnishes information to the DOT, DHS, NTSB, or any federal, state or local law enforcement agency regarding an accident resulting in death or injury to a person in connection with railroad transportation; or
- accurately reports hours on duty.
Under the FRSA’s good-faith report requirement, any report made in good faith is protected activity; whether the medical cause of an injury is ultimately work-related is immaterial. Koziara v. BNSF Railway Co., No. 13-cv-834-jdp, 2015 WL 137272, at *6-7 (W.D. Wis. Jan. 9, 2015); Davis v. Union Pacific Railroad Co., No. 5:12-CV-2738, 2014 WL 3499228, at *6-7 (W.D. La. July 14, 2014).
Examples of FRSA protected whistleblowing include:
- Refusing to perform a roll-by inspection from the ground, where the complainant reasonably believed the inspection would violate Canadian National Railroad Operating Rule 523, which requires: “When duties and terrain permit, at least two crew members of a standing train . . . must inspect passing trains on the ground on both sides of the track. At locations where trains will meet, the train to arrive second must notify the first train when they pass the approach to the siding, to allow crew members to be in position for inspection.”
Scope of Prohibited Retaliation/Adverse Actions
The FRSA prohibits a wide range of retaliatory actions, including discharging, demoting, suspending, reprimanding, or in any other way discriminating against a whistleblower. As Judge Gee recently held in Herbert Rothschild v. BNSF Railway Co., 2017-FRS-0003 (Jan. 2, 2019):
The list of prohibited activities is “quite broad” and includes reprimands or counseling sessions “which are coupled with a reference to potential discipline.” Williams v. American Airlines, ARB No. 09-00018, ALJ No. 2007-AIR-00004, slip op. at 10-11(ARB Dec. 29, 2010). . .[A] notice of investigation [can be actionable retaliation] because it does more than refer to “potential” discipline: it notifies the employee that disciplinary processes have been initiated against him. Even if the investigation were ultimately to be canceled, the employee would be aware that his employer was in the process of mustering evidence and witnesses against him, and that he faced a very real risk of discipline. . . . the notice of investigation is the first step in a disciplinary process that can lead to discipline and loss of income, and is part of a progressive discipline policy where successive violations lead to more serious consequences, potentially including termination. . . A written warning is presumptively adverse, including where it implicitly or explicitly references potential discipline. Williams v. American Airlines, ARB No. 09-00018, at 11.
However, being called a “rat” in the workplace is not sufficient to be an adverse employment action where no discipline was threatened, the whistleblower’s position was not changed, and the employer took action to remedy the situation. Clay McDonald v. Union Pacific Railroad Co., 2016-FRS-00034 (ALJ Aug. 20, 2019).
Proving FRSA Whistleblower Retaliation
A “contributing factor” is a factor that had any tendency to affect the employer’s decision to take an adverse action. It is an intentionally low bar that allows an employee to prevail even if his protected activity is only one of many factors the employer considered. Because of this, an employee is not required to prove pretext or retaliatory motive to satisfy the contributing factor standard.
“Neither motive nor animus is a requisite element of causation as long as protected activity contributed in any way—even as a necessary link in a chain of events leading to adverse activity.” Hutton v. Union Pacific R.R. Co., No. 11-091, 2013 WL 2450037, at *9 (ARB May 31, 2013).
For example, if an employee’s injury report led to an investigation, which in turn led to discipline, the protected conduct (reporting the injury) can be deemed a contributing factor in the adverse action. Araujo v. New Jersey Transit Rail Operations, Inc., 708 F.3d 152 (3d Cir. 2013). An FRSA plaintiff “need not demonstrate the existence of a retaliatory motive on the part of the employee taking the alleged prohibited personnel action in order to establish that his disclosure was a contributing factor to the personnel action.” Araujo 708 F.3d at 158 (3d Cir. 2013) (quoting Marano v. Dep’t of Justice, 2 F.3d 1137, 1141 (Fed. Cir. 1993)).
Contributing factor causation can be shown by alleging facts regarding “temporal proximity, indications of pretext, and a change in the employer’s attitude toward the employee after he engages in protected activity.” Rookaird v. BNSF Ry. Co., No. C14-176RSL, 2015 WL 6626069, at *2 (W.D. Wash. Oct. 29, 2015).
Circumstantial evidence may include a wide variety of evidence, such as temporal proximity, indications of pretext, inconsistent application of an employer’s policies, an employer’s shifting explanations for its actions, antagonism or hostility toward a complainant’s protected activity, the falsity of an employer’s explanation of the adverse action taken, and a change in the employer’s attitude toward the complainant after he or she engages in protected activity. Bechtel v. Competitive Techs., Inc., ARB No. 09-052, ALJ No. 2005-SOX-033, slip op. at 13 (ARB Sept. 30, 2011).
If a complainant proves pretext, it may be inferred that his protected activity contributed to the termination. Riess v. Nucor Corp., ARB 08-137, 2008-STA-011, slip op. at 6 (ARB Nov. 30, 2010).
Proof of animus towards protected activity may be sufficient to demonstrate discriminatory motive. Sievers v. Alaska Airlines, Inc., ARB No. 05-109, ALJ No. 2004-AIR-028, slip op. at 4-5 (ARB Jan. 30, 2008). “[R]idicule, openly hostile actions or threatening statements,” may serve as circumstantial evidence of retaliation. Timmons v. Mattingly Testing Services, 1995-ERA-00040 (ARB June 21, 1996).
“Where protected activity and unfavorable employment actions are inextricably intertwined, causation is established without the need for circumstantial evidence; however, such -33 -evidence may certainly bolster the causal relationship.” Benjamin v. Citationshares Management, L.L.C., ARB No. 12-029, ALJ No. 2010-AIR-001, slip op. at 12 (ARB Nov. 5, 2013).
Affirmative Defense for Rail Carriers in FRSA Whistleblower Retaliation Cases
A rail carrier can escape liability if it demonstrates by clear and convincing evidence it would have taken the adverse action absent protected activity.
A key method to prove the same-decision affirmative defense is comparator evidence. But FRSA whistleblower should scrutinize such evidence carefully to test whether it is truly relevant. For example, if a rail carrier terminates a whistleblower for discrepancies in the whistleblower’s protected disclosure, evidence of discipline for patently and materially false hearing testimony is not relevant.
It is also important to consider “the proportional relationship between the adverse actions and the bases for the actions.” See Speegle v. Stone & Webster Constr., Inc., ARB Case No. 13-074, 2014 WL 1758321, at *7 (Dep’t of Labor Admin. Review Bd. Apr. 25, 2014).
Damages and Remedies for FRSA Whistleblowers
A prevailing whistleblower can obtain a wide range of remedies, including: (1) reinstatement, (2) back pay, (3) compensatory damages, (4) attorney fees and litigation costs; and (5) punitive damages up to $250,000.
In 2017, the First Circuit affirmed an award of $250,000 in punitive damages, the maximum amount that the FRSA allows, where rail carrier Pan Am “utilized the [disciplinary] process to intimidate and discourage protected activity.” Pan Am Railways, Inc. v. United States Department of Labor, ___ F.3d ___, 2017 U.S. App. LEXIS 7047 (1st Cir. April 21, 2017). In that case, the ALJ specifically found that Pan Am had willfully retaliated against the whistleblower for filing an OSHA complaint and that it had “consciously disregarded Raye’s statutorily-protected rights under the FRSA, and in fact intentionally interfered with the exercise of those rights.”
FRSA Statute of Limitations
The statute of limitations to file a FRSA whistleblower retaliation claim is 180 days. As the Third Circuit held in Guerra v. Consolidated Rail Corporation, Court of Appeals, No. 18-2471, (3rd Cir. 2019, the FRSA’s statute of limitations is a nonjurisdictional claim-processing rule. However, failing to file within the statute of limitations will likely result in the dismissal of the claim.
What is required to demonstrate a protected disclosure about a hazardous safety or security condition?
A September 2021 Second Circuit decision in Ziparo v. CSX Transportation, Inc., 20-1196-cv (2d Cir. Sept 24, 2021) holds that complaints of stressful and distracting work conditions may well fall within the scope of “hazardous safety or security condition[s]” under § 20109(b)(1)(A). The court also held that “a railroad employee engages in protected activity under § 20109(b)(1)(A) when she reports what she subjectively believes to be a hazardous safety or security condition irrespective of whether that understanding is objectively reasonable.”
Experienced Whistleblower Protection Lawyers
Before hiring a lawyer for a whistleblower case, assess the lawyer’s reputation, prior experience representing whistleblowers, knowledge of whistleblower laws, and prior results. And consider the experience of other whistleblowers working with that attorney. We have extensive experience representing whistleblowers under a wide variety of corporate whistleblower protection laws. See our client testimonials by clicking here.
- U.S. News and Best Lawyers® have named Zuckerman Law a Tier 1 firm in Litigation – Labor and Employment in the Washington DC metropolitan area.
- Dallas Hammer has extensive experience representing whistleblowers in retaliation and rewards claims and has written extensively about cybersecurity whistleblowing. He was selected by his peers to be included in The Best Lawyers in America® in the category of employment law in 2021 and 2022.
- Described by the National Law Journal as a “leading whistleblower attorney,” founding Principal Jason Zuckerman has established precedent under a wide range of whistleblower protection laws and obtained substantial compensation for his clients and recoveries for the government in whistleblower rewards and whistleblower retaliation cases. He served on the Department of Labor’s Whistleblower Protection Advisory Committee, which makes recommendations to the Secretary of Labor to improve OSHA’s administration of federal whistleblower protection laws. Zuckerman also served as Senior Legal Advisor to the Special Counsel at the U.S. Office of Special Counsel, the federal agency charged with protecting whistleblowers in the federal government. At OSC, he oversaw investigations of whistleblower claims and obtained corrective action or relief for whistleblowers.
- Zuckerman was recognized by Washingtonian magazine as a “Top Whistleblower Lawyer” (2020, 2018, 2017, 2015, 2009, and 2007), selected by his peers to be included in The Best Lawyers in America® in the category of employment law (2011-2021) and in SuperLawyers in the category of labor and employment law (2012 and 2015-2021), is rated 10 out of 10 by Avvo, based largely on client reviews, and is rated AV Preeminent® by Martindale-Hubbell based on peer reviews
- We have published extensively on whistleblower rights and protections, and speak nationwide at seminars and continuing legal education conferences. We blog about new developments under whistleblower retaliation and rewards laws at the Whistleblower Protection Law and SEC Awards Blog, and in 2019, the National Law Review awarded Zuckerman its “Go-To Thought Leadership Award” for his analysis of developments in whistleblower law.
To learn more about whistleblower rewards or whistleblower protections, call the whistleblower lawyers at Zuckerman Law for a free consultation at 202-262-8959, or click here.
Swap Dealer Disclosure and Reporting Requirements
Under the Dodd-Frank Act, swap dealers and major swap participants are required to comply with certain disclosure, recordkeeping, and reporting requirements related to its swap transactions. This includes the timely and accurate reporting of:
- swap transaction and pricing data that is reported in real-time and made available to the public;
- required swap creation data; and
- required swap continuation data.
We represents whistleblowers at the CFTC. Call our CFTC whistleblower lawyers today at 202-930-5901 or contact us here to find out if you are eligible for a CFTC whistleblower award. All inquiries are confidential.
See our recent post: How Whistleblower Disclosures of Swaps Manipulation or Swaps Reporting Violations Can Qualify for CFTC Whistleblower Awards
Purpose of Swap Reporting Requirements
The reporting requirements are designed to enhance transparency, promote standardization, and reduce systemic risk. Among the many requirements include: maintaining a data field for the legal entity identifiers (LEI), correcting any errors in swap data that were previously reported, and implementing a Business Continuity and Disaster Recovery Plan to be implemented in the event of a disruption of the swap dealer’s normal business activities. For a complete list of the reporting requirements, refer to 17 CFR Part 45.
CFTC Swap Reporting Enforcement Action
In September 2023, the CFTC ordered three financial institutions to pay more than $50 million for a variety of swap dealer activities including failures related to swap data reporting and, in one case, failures related to the disclosure of Pre-Trade Mid-Market Marks (PTMMMs):
- Goldman Sachs for failing to diligently supervise a wide range of its swap dealer activities, and for unprecedented failures regarding swap data reporting and the disclosure of PTMMMs in violation of multiple sections of the Commodity Exchange Act (CEA) and CFTC regulations. The order imposes a $30,000,000 civil monetary penalty and includes Goldman taking steps to develop a written remediation plan and retain a consultant to advise on and assess its remediation plan.
- J.P. Morgan for violations related to swaps reporting. The order imposes a $15,000,000 civil monetary penalty and other undertakings.
- Bank of America for failing to diligently supervise swaps reporting and failing to comply with swaps reporting obligations. The order imposes an $8 million civil monetary penalty and other undertakings.
In 2016, Deutsche Bank AG (“Deutsche Bank”) was charged with “failing to report any swap data for multiple asset classes for five days; submitting incomplete and untimely swap data; failing to supervise its employees responsible for swap data reporting; having an inadequate Business Continuity and Disaster Recovery Plan; and violating a prior CFTC Order.” The charge derived from a system outage in the bank’s swap data reporting system that prevented Deutsche Bank from reporting any swap data for multiple asset classes for approximately five days. Due to an ineffective Business Continuity and Disaster Recovery Plan, the subsequent efforts to end the system outage only exacerbated the problems.
CFTC Whistleblower Program
Under the CFTC Whistleblower Program, whistleblowers may be eligible for monetary awards when they voluntarily provide the CFTC with original information about violations of the Commodity Exchange Act (“CEA”) that leads the CFTC to bring a successful enforcement action resulting in monetary sanctions exceeding $1,000,000.
CFTC Whistleblower Rewards and Bounties
Whistleblowers are eligible to receive between 10 percent and 30 percent of the monetary sanctions collected. In October 2021, the CFTC awarded $200 million to a whistleblower for providing information that led the CFTC to evidence of wrongdoing concerning the manipulation of financial benchmarks used by global banks.
CFTC Whistleblower Protection
The CFTC Whistleblower Program also protects the confidentiality of whistleblowers and does not disclose information that might directly or indirectly reveal a whistleblower’s identity. Furthermore, the Dodd-Frank Act protects whistleblowers from retaliation by their employers for reporting violations of the CEA to the CFTC.
CFTC Whistleblower Lawyers
Since 2014, the CFTC has issued more than $325 million in awards to whistleblowers. The largest CFTC whistleblower awards to date are $200 million, $45 million, $30 million, and $10 million. Whistleblower disclosures have enabled the CFTC to bring successful enforcement actions against wrongdoers with orders for more than $3 billion in monetary relief.
Call our CFTC whistleblower lawyers today at 202-930-5901 or contact us here to find out if you are eligible for a CFTC whistleblower award. A delay in reporting commodities fraud can potentially disqualify a whistleblower from recovering an award or can lower a whistleblower award, so call us today for a free consultation. We represent CFTC whistleblowers concerning a wide variety of market manipulation schemes.
Our experienced CFTC whistleblower lawyers are frequently quoted in the media about whistleblower reward programs. Recently, the Wall Street Journal quoted Jason Zuckerman in an article titled Senate Passes Bill to Fund CFTC Whistleblower Program, and quoted Matthew Stock, Director of our Whistleblower Rewards Practice, in an article titled CFTC Whistleblower Tips and Awards Fall After Record 2018.
Recently the Association of Certified Fraud Examiners published a profile of Matt Stock’s success working with whistleblowers to fight fraud:
CFTC Regulation of Swaps
In a September 7, 2022 statement regarding a trader’s misconduct and a financial intermediary’s failure to supervise, Commissioner Kristin N. Johnson explained the CFTC’s regulation of swaps:
Companies around the country and across the globe use swaps, which comprise a global market with a notional value in the hundreds of trillions of dollars, to manage risk. As evidenced by the events that precipitated the onset of the 2008 financial crisis, however, swaps—an unregulated sector of financial markets at that time—concentrated risk, obscured risk management failures, and contributed to one of the most pernicious financial market crashes in recent history. The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) introduced several key reforms; among these monumental regulatory initiatives, the Dodd Frank Act directed the CFTC to exercise its oversight authority in the markets for certain swaps. The CFTC’s implementation of these critical reforms has increased transparency in swaps markets through mandatory reporting of swaps and governance reforms for market participants such as swaps dealers.
Section 4s of the Commodity Exchange Act (CEA) contains the key swap provisions added by the Dodd-Frank Act. CEA Section 4s(f) imposes reporting and recordkeeping requirements on registered swap dealers and major swap participants, including a requirement to keep books and records as prescribed by the CFTC. These requirements were implemented by the CFTC in Subpart F of Part 23 of the CFTC’s Regulations. The Dodd-Frank Act also added CEA Section 21, which established a new category of registrant—swap data repositories—to collect and disseminate information about the swaps being entered into, in order to avoid the opaque accumulation of risk that characterized the markets leading up to the financial crisis. Increased transparency leads to lower costs, greater liquidity, and lower risk for the swaps market. However, these benefits are not achieved if market participants provide inaccurate or misleading information about the swaps they are entering into—which is why it is crucial for the CFTC to enforce compliance with the reporting and recordkeeping requirements in the CEA and CFTC Regulations.
Other aspects of Dodd-Frank Act reforms aim to improve the governance of swap dealers to ensure the greater safety and soundness of the swaps market. CEA Section 4s(h)(1)(B) requires swap dealers to conform with business conduct standards relating to the diligent supervision of the business of the swap dealer, as set forth in Regulation 23.602. Pursuant to this rule and other provisions of the business conduct standards, swap dealers must establish risk management programs and designate senior personnel to oversee them. In this way, swap dealers become responsible for ensuring compliance with the CFTC’s Regulations so that the Dodd-Frank Act reforms may achieve intended prudential and regulatory goals. The CFTC’s enforcement actions in these matters and others parallel these aims and seek to ensure that swap dealers are, in fact, implementing appropriate and mandated risk management programs effectively. Those who fail to meet their supervisory responsibilities should anticipate inquiries, investigations, and the possibility of enforcement actions.
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