The ARB upheld a damages award in favor of a whistleblower after his former employer purportedly “blacklisted” him by providing an apparently negative employment reference to a prospective employer.  Timmons v. CRST Dedicated Services, Inc., ARB Case No. 14-051 (Sept. 29, 2014).  This underscores the impact whistleblower laws have on employers’ post-termination conduct.

Background

Complainant Grant Timmons (Complainant) worked as a truck driver for CRST Dedicated Services, Inc. (Company). During his employment, Complainant allegedly voiced concerns about job safety. The Company subsequently terminated his employment, and he filed a whistleblower complaint under the Surface Transportation Assistance Act of 1982 (STAA).  The parties settled, and the settlement agreement contained a non-disparagement clause providing that the Company would not make any statements damaging to Complainant’s professional reputation.  Complainant later applied for a driver position with another company, which received an electronically generated employment verification report from the Company allegedly providing that the Company terminated Complainant’s employment because he did not meet company standards and he was not eligible for rehire.  According to Complainant, he would have been hired but for the Company’s negative report.  Complainant filed a complaint with OSHA alleging that he was “blacklisted” in retaliation for complaints during his employment.  An ALJ ruled that Timmons’ protected whistleblowing activity contributed to CRST’s negative employment reference, and the Company appealed to the ARB.

ARB’s Decision

Stressing that STAA regulations provide a cause of action to whistleblowers who are blacklisted, the ARB ruled that there was substantial evidence to support the ALJ’s finding that the Company blacklisted Complainant in retaliation for his protected activity.  The ARB rejected the Company’s argument that the negative employment verification was unintentional, noting that the Company’s Human Resources department ordered an employee to add negative details to Complainant’s employment record.

Implications

This decision serves as a reminder to employers of the need to be cautious about risks attendant to adverse actions against a whistleblower even after the employment relationship has ended.

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Photo of Steven J. Pearlman Steven J. Pearlman

Steven J. Pearlman is a partner in the Labor & Employment Law Department and Co-Head of the Whistleblowing & Retaliation Group and the Restrictive Covenants, Trade Secrets & Unfair Competition Group.

Steven’s practice covers the full spectrum of employment law, with a particular…

Steven J. Pearlman is a partner in the Labor & Employment Law Department and Co-Head of the Whistleblowing & Retaliation Group and the Restrictive Covenants, Trade Secrets & Unfair Competition Group.

Steven’s practice covers the full spectrum of employment law, with a particular focus on defending companies against claims of employment discrimination, retaliation and harassment; whistleblower retaliation; restrictive covenant violations; theft of trade secrets; and wage-and-hour violations. He has successfully tried cases in multiple jurisdictions, and defended one of the largest Illinois-only class actions in the history of the U.S. District Court for the Northern District of Illinois. He also secured one of only a few ex parte seizures orders that have been issued under the Defend Trade Secrets Act, and obtained a world-wide injunction in federal litigation against a high-level executive who jumped ship to a competitor.

Reporting to boards of directors, their audit committees, CEOs and in-house counsel, Steven conducts sensitive investigations and has testified in federal court. His investigations have involved complaints of sexual harassment involving C-suite officers; systemic violations of employment laws and company policies; and fraud, compliance failures and unethical conduct.

Steven was recognized as Lawyer of the Year for Chicago Labor & Employment Litigation in the 2023 edition of The Best Lawyers in America. He is a Fellow of the College of Labor and Employment Lawyers.  Chambers describes Steven as an “outstanding lawyer” who is “very sharp and very responsive,” a “strong advocate,” and an “expert in his field.” Steven was 1 of 12 individuals selected by Compliance Week as a “Top Mind.” Earlier in his career, he was 1 of 5 U.S. lawyers selected by Law360 as a “Rising Star Under 40” in the area of employment law and 1 of “40 Illinois Attorneys Under Forty to Watch” selected by Law Bulletin Publishing Company. Steven is a Burton Award Winner (U.S. Library of Congress) for “Distinguished Legal Writing.”

Steven has served on Law360’s Employment Editorial Advisory Board and is a Contributor to Forbes.com. He has appeared on Bloomberg News (television and radio) and Yahoo! Finance, and is regularly quoted in leading publications such as The Wall Street Journal.

The U.S. Chamber of Commerce has engaged Steven to serve as lead counsel on amicus briefs to the U.S. Supreme Court and federal circuit courts of appeal. He was appointed to serve as a Special Assistant Attorney General for the State of Illinois in employment litigation matters. He has presented with the Solicitor of the DOL, the Acting Chair of the EEOC, an EEOC Commissioner, Legal Counsel to the EEOC and heads of the SEC, CFTC and OSHA whistleblower programs. He is also a member of the Sedona Conference, focusing on trade secret matters.

Photo of Allison Martin Allison Martin

Allison Martin is a senior counsel in the Labor & Employment Law Department. Allison represents employers in a wide range of employment litigation matters, including employment discrimination and harassment lawsuits arising under Title VII and similar state and local statutes, retaliation claims, and…

Allison Martin is a senior counsel in the Labor & Employment Law Department. Allison represents employers in a wide range of employment litigation matters, including employment discrimination and harassment lawsuits arising under Title VII and similar state and local statutes, retaliation claims, and wage-and-hour claims. She represents employers in federal and state courts, arbitration tribunals, and before the EEOC and the New York City Commission on Human Rights. Allison has extensive experience litigating both single plaintiff and class action lawsuits.

Allison also counsels clients on a broad range of employment law matters, including investigations, employment policies and procedures, and employee terminations and discipline. She also has experience conducting high-profile internal investigations on behalf of employers.

Allison previously served as a federal law clerk in the U.S. District Court for the Southern District of New York.

At Seton Hall University School of Law, Allison was an Articles Editor for the Seton Hall Law Review. Allison also  interned for Chief Judge Garrett E. Brown (Ret.) of the U.S. District Court for the District of New Jersey while in law school.