ARB Upholds Retaliation Award, Shows Broad Support for Punitive Damages

The U.S. Department of Labor’s Administrative Review Board (ARB) upheld a punitive-damages award of $100,000 in a truck driver’s retaliation case against UPS, flagging its broader reluctance to reject as excessive any punitive award under the Surface Transportation Assistance Act (STAA).

The ARB noted that STAA imposes a low $250,000 cap on punitive damages; awards that fall within the legal cap simply don’t raise a constitutional “excessiveness” concern, it said.

The panel also declined to impose a “bright-line ratio” that limits punitive damages to a certain multiple of compensatory damages. Here, too, the ARB cited the STAA’s low cap on punitive damages, which it said eliminated any specter of “limitless punitive damages in cases where no harm had occurred.”

The ARB’s ruling came in the case of Youngermann v. United Parcel Service, Inc. A lower-level judge had previously ordered UPS to pay $111,000 — including the $100,000 in punitive damages — for firing Mr. Youngermann after he refused to drive a truck and trailer with inoperable lights.

UPS appealed only the award of punitive damages, saying it was both unwarranted and excessive. The ARB disagreed on both counts, citing “substantial evidence” that UPS managers knowingly ordered Mr. Youngermann to violate federal safety regulations — and fired him for insubordination when he refused.

Besides falling comfortably with the STAA’s limits on punitive damages, the $100,000 award was in line with comparable cases, the ARB found. Such an award “is sufficient in size to deter a company such as UPS from similar conduct without being grossly excessive,” the panel said.

The Employment Law Group® law firm’s whistleblower attorneys have helped many clients file suit against employers that fraudulently bill the U.S. government, and have established favorable precedents under the retaliation provision of the False Claims Act.

Tagged: Administrative Review Board (ARB), Enforcement Bodies, Surface Transportation Assistance Act (STAA), Whistleblower Laws (Federal)