Complainant v. John M. McHugh, Secretary, Department of the Army, Agency. Appeal No. 0720130011 Hearing No. 550-2011-00481X Agency No. ARUSAR10NOV04919 DECISION Concurrent with its December 3, 2012, final order, the Agency timely filed an appeal which the Commission accepts pursuant to 29 C.F.R. § 1614.405(a). On appeal, the Agency requests that the Commission affirm its rejection of an EEOC Administrative Judge's (AJ's) order awarding monetary sanctions against the Agency. The Agency accepts the AJ's finding of discrimination in violation of the Age Discrimination in Employment Act of 1967 (ADEA), as amended, 29 U.S.C. § 621 et seq. For the following reasons, the Commission MODIFIES the Agency's final order. ISSUE PRESENTED The issue presented is whether the EEOC Administrative Judge (AJ) properly ordered the Agency to pay monetary sanctions because the Agency failed timely and fully to produce discovery and to comply with the AJ's orders. BACKGROUND At the time of events giving rise to this complaint, Complainant was an applicant for a permanent position as an Engineering Equipment Operator, WG-5716-11, at the Agency's Roads Branch, Operations and Maintenance Division, Directorate of Public Works (DPW) facility in Fort Hunter Liggett, California. Complainant previously worked as a WG-11 Engineering Equipment Operator at Fort Hunter Liggett under a term appointment that ended on September 30, 2010. On October 4, 2010, the Agency announced four vacancies for a permanent Engineering Equipment Operator, WG-5716-11, position.1 The vacancy announcement stated that candidates must have "National Wildland Coordinating Group NWCG S-130 and S-190 Certification," that applicants' resumes must include information about the certifications, and that failure to provide information would "result in an ineligible rating." Complainant applied and was found qualified for the position. The selecting official, the Operations and Maintenance Manager, chose four other candidates for the position. The selectees were 32, 39, 45, and 29 years old. On November 29, 2010, Complainant filed an EEO complaint alleging that the Agency discriminated against him on the basis of age (55) when it did not select him for the permanent Engineering Equipment Operator position under Vacancy Announcement NCDE10504099DR1. The Agency accepted the complaint for investigation and, at the conclusion of the EEO investigation, provided Complainant with a copy of the Report of Investigation and notice of his right to request a hearing before an EEOC Administrative Judge. Complainant timely requested a hearing, which the AJ held a hearing on April 18, June 27, and July 3, 2012. Prior to the hearing, in October 2011 and again in November 2011, Complainant's first representative asked the Agency to produce "S-130 and S-190 module dates" and documents concerning the candidates for the permanent Engineering Equipment Operator position. In response, the Agency cited five candidates' Certificates of Training, which were contained in the Report of Investigation for Complainant's complaint, and submitted two other candidates' Certificates of Training, which were contained in the Report of Investigation for another applicant's EEO complaint. Subsequently, noting that the Department of Homeland Security's U.S. Fire Administration oversaw S-130 and S-190 coursework certification, the Agency stated that it did not have the module certificates that Complainant sought. In an April 11, 2012, Motion to Strike and to Compel Compliance with the Court's Order, Complainant's attorney objected to the Agency's failure to produce the module certificates. She stated that the parties disputed whether the selectees received the S-130 and S-190 certificates before completing the modules. The attorney subsequently filed a Motion for Evidentiary and Terminating Sanctions regarding the module certificates and e-mails whose existence was disclosed through witness testimony at the hearing on Complainant's complaint and at the hearing on the other applicant's complaint. In response, the Agency argued that it responded to discovery orders in good faith and that sanctions were not warranted. On July 10, 2012, the Agency submitted module certificates for two selectees and partial transcripts for a third selectee. On October 18, 2012, the AJ issued a decision finding that the Agency discriminated against Complainant on the basis of age when it did not select him for one of the permanent Engineering Equipment Operator positions. The AJ ordered the Agency to place Complainant in the position or a substantially equivalent position retroactively to October 24, 2010, and to provide him with all of the back pay and benefits that he would have earned absent the discrimination. The AJ noted that prevailing parties in ADEA federal-sector administrative cases are not entitled to liquidated damages, compensatory damages, or attorney's fees and costs. On October 19, 2012, the AJ issued an Order on Complainant's Request for Sanctions. The AJ noted that "a good deal of the evidence used to support" the finding of discrimination, including e-mails regarding the selection process and two referral lists as well as the module certificates, "was not produced until at or after the Hearing. As such, production of the material was of considerable importance to the complainant's case." She concluded that "the most meaningful Sanctions Order . . . is one that will compensate the complainant's attorney for her efforts to obtain information that was relevant and necessary for the successful prosecution of her client's case." After reviewing the Motions that Complainant's attorney filed and the Agency's Responses, the AJ determined that 16.5 hours was a reasonable time for the work that the attorney performed and that the attorney should be compensated at the rate of $425 per hour. Noting that "[a] prevailing ADEA complainant in the federal administrative process is not entitled to attorney's fees," the AJ stated that her "assessment of the reasonable rate for the work performed on the discovery and sanctions motions should not be regarded as a determination of what [the attorney's] reasonable hourly rate would be if she were able to receive payment for her work in all aspects of this case." The AJ ordered the Agency "to compensate the complainant's attorney in the amount of $7,012.50 as a Sanction for the agency's failure to timely and fully produce discovery and comply with [the AJ's] orders." On December 3, 2012, the Agency issued a Final Order implementing the AJ's finding of discrimination and the corresponding remedy. The Agency did not implement the AJ's Order on Complainant's Request for Sanctions. The Agency stated that it was "willing to pay the $7,012.50 in monetary sanctions; however Army lacks legal authority to do so." It further stated that it is bound by a Department of Justice Office of Legal Counsel opinion "that there has been no express waiver of sovereign immunity that would authorize the payment of sanctions in administrative cases before the EEOC." According to the Agency, it could not implement the AJ's Sanctions Order without potentially violating the Anti-Deficiency Act, 31 U.S.C. § 1341. CONTENTIONS ON APPEAL On appeal, the Agency argues that the doctrine of sovereign immunity precludes prevailing ADEA complainants from receiving attorney's fees in the administrative process and that attorney's fees may not "be recast as sanctions." The Agency asserts that, although the AJ's Order refers to sanctions, it nonetheless "clearly directs payment of attorney['s] fees." Further, citing a Department of Justice Office of Legal Counsel opinion, The Equal Employment Opportunity Commission's Authority to Impose Monetary Sanctions Against Federal Agencies for Failure to Comply with Order Issued by EEOC Administrative Judges (January 6, 2003) (Department of Justice Memorandum), the Agency asserts that the doctrine of sovereign immunity precludes the Commission from imposing monetary sanctions against federal agencies for violations of an EEOC Administrative Judge's orders. Additionally, the Agency maintains that paying monetary sanctions without legal authority to do so places the Agency's senior officials in jeopardy of violating the Anti-Deficiency Act, 31 U.S.C. § 1341, which imposes disciplinary action and criminal liability if appropriations are made beyond purposes provided by the law. The Agency also maintains that the Purpose Statute, 31 U.S.C. § 1301, further precludes it from paying monetary sanctions because it states that "appropriations shall be applied only to the objects for which the appropriations were made except as otherwise provided by law." The Agency asserts that the Government Accountability Office (GAO) has stated that "the hiring of an attorney is a private matter between the attorney and the client, and absent express statutory authority, an agency is not authorized to pay an employee's" attorney's fees. According to the Agency, paying attorney's fees not authorized by law would violate the Purpose Statute. Further, the Agency states that "GAO decisions consistently apply the principle that the use of appropriated funds for unauthorized or prohibited purposes in violation of the Purpose Act also violates the Anti-Deficiency Act, because zero funds are available for such purposes." Noting that employees may be subject to criminal penalties for willful violations of the Anti-Deficiency Act, the Agency argues that paying the amount in question here would place Agency officials "at significant personal risk." In response, Complainant, through his attorney, argues that the Commission has authority to issue sanctions in ADEA cases. Citing Commission precedent, Complainant notes that the Commission has held that the doctrine of sovereign immunity does not preclude the Commission from imposing monetary sanctions against an agency. Complainant argues that, because the Commission has authority to issue sanctions, the Anti-Deficiency Act does not apply.2 ANALYSIS AND FINDINGS The Commission "has the authority to issue sanctions in the administrative hearing process because it has been granted, through statute, the power to issue such rules and regulations that it deems necessary to enforce the prohibition on employment discrimination." Matheny v. Dep't of Justice, EEOC Request No. 05A30373 (Apr. 21, 2005). In Matheny, the Commission affirmed an AJ's finding in favor of the complainant as a sanction for the agency's failure to provide investigative reports. We concluded that Section 717 of Title VII of the Civil Rights Act of 1964 (Title VII), 29 U.S.C. 2000e-16, provides for a waiver of sovereign immunity. In that regard, we noted that "Federal agencies 'shall comply with such rules, regulations, orders, and instructions' which are issued by the Commission and which the Commission 'deems necessary and appropriate to carry out its responsibilities' to enforce the prohibitions on unlawful discrimination in employment." Matheny, supra (quoting 29 U.S.C. 2000e-16(b)); cf. 29 U.S.C. § 633a(b) (same statutory language in Section 15 of ADEA). We also concluded that "the use of sanctions is a necessary component of the regulatory scheme" and that the Department of Justice "recognized that the Commission must have authority to enforce its orders: 'And arguably, EEOC may have some inherent power to impose some type of sanctions designed to maintain the integrity of its proceedings even against federal agencies. One could infer this from the fact that Congress is presumed to have made its statutory scheme effective.'" Matheny, supra (quoting the Department of Justice Memorandum at 8). The Commission has specifically deemed monetary sanctions, including attorney's fees and costs, "necessary and appropriate to carry out its responsibilities." See 29 C.F.R. § 1614.109(f)(3) (AJ may take action against a party that fails, without showing good cause, to respond fully and timely to an order or requests for documents); EEOC Management Directive for 29 C.F.R. Part 1614 (EEO MD-110), Chap. 7, at § III.D (Nov. 9, 1999) (AJ has authority to impose sanctions on parties that do not comply with orders or requests); id. at § V.A. (sanctions under 29 C.F.R. § 1614.109(f)(3) may be evidentiary, monetary, or both; monetary sanctions include attorney's fees and costs of discovery); id. at Chap. 11, § VIII.C. (AJ has authority to impose attorney's fees even absent a finding of discrimination). The Commission has long used monetary sanctions as a tool to ensure full compliance with Administrative Judges' orders. See, e.g., Adkins v. Fed. Deposit Ins. Corp., EEOC Appeal No. 0720080052 (Jan. 13, 2012) (AJ properly exercised authority under 29 C.F.R. § 1614.109(f)(3) to sanction agency for its failure to complete the investigation of complainant's Title VII and ADEA claims by issuing a default judgment of age discrimination and ordering agency to pay attorney's fees and costs); O'Kosi v. U.S. Postal Serv., EEOC Appeal No. 01970051 (Apr. 30, 1998) (affirming AJ's award of all costs to complainant, who partially prevailed on his Title VII claim, as sanction for Agency's failure to attend hearing). Monetary sanctions, including attorney's fees and costs, may be awarded to a complainant even if he or she does not prevail on the underlying discrimination claim. For example, in Stull v. Department of Justice, EEOC Appeal No. 01941582 (June 15, 1995), the Commission affirmed an AJ's award of attorney's fees as a sanction for the agency's failure to produce documents in response to a discovery order. The Commission noted that it was irrelevant that the complainant did not prevail on his Title VII complaint because, "unlike the situation where attorney's fees are awarded pursuant to 29 C.F.R. § 1614.501(e) to a complainant who prevails on the merits, 29 C.F.R. § 1614.109[(f)](3) pertaining to sanctions for non-compliance in discovery contains no such 'prevailing' requirement." More recently, in Complainant v. Department of Commerce, EEOC Appeal No. 0720140016 (February 7, 2014), the Commission found that the AJ properly ordered the agency to pay attorney's fees and costs related to a dispute involving depositions to a complainant who did not prevail on his Title VII and ADEA claim. We reiterated that 29 C.F.R. § 1614.109(f)(3) authorizes an AJ to impose Attorney's fees and costs as sanctions and "does not require a complainant to prevail on the merits in order for an AJ to issue sanctions." See also Waller v. Dep't of Transp., EEOC Appeal No. 0720030069 (May 25, 2007) (affirming AJ order that agency pay attorney's fees and costs incurred in preparation of motion for sanctions to complainant who did not prevail on her Title VII and Equal Pay Act claim), req. for recon. denied, EEOC Request No. 0520070689 (Feb. 26, 2009); Fitch v. Dep't of the Navy, EEOC Appeal No. 01A03071 (Aug. 15, 2002) (agency must comply with AJ order to pay attorney's fees associated with motion to compel to complainant who did not prevail on Title VII and ADEA claim); Comer v. Fed. Deposit Ins. Corp., EEOC Request No. 05940649 (May 31, 1996) (ordering agency to pay costs, including attorney's fees, resulting from agency's failure to appear at deposition to complainant who did not prevail on her Title VII claim). In this case, in the Final Order, the Agency did not contest the propriety of the sanction that the AJ imposed upon the Agency. Instead, the Agency asserted that it is willing to pay the monetary sanction but does not have authority to do so because of sovereign immunity and a potential violation of the Anti-Deficiency Act. The Commission previously has addressed, and rejected, the Agency's arguments regarding sovereign immunity and the Anti-Deficiency Act. In Mirabal v. Department of the Army, EEOC Appeal No. 0720120007 (November 9, 2012), request to reconsider denied, EEOC Request No. 0520130236 (March 27, 2014), we found that the AJ properly ordered the Agency to pay attorney's fees incurred because of delays in the hearing on the complainant's claim of national-origin discrimination in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. Citing Matheny and other Commission precedent, we concluded that the Commission has authority to issue monetary sanctions and that the AJ's actions were consistent with Commission regulations, EEO MD-110, and Commission precedent. See also Complainant v. Dep't of the Army, EEOC Appeal No. 0720130033 (Apr. 24, 2014) (rejecting Agency's arguments, in a Title VII case, that it did not have authority to pay attorney's fees sanction because of sovereign immunity and a potential violation of the Anti-Deficiency Act), req. for reconsideration denied, EEOC Request No. 0520140359 (Mar. 20, 2015). The Agency's arguments remain unpersuasive. Section 15 of the ADEA, like Section 717 of Title VII, authorizes the Commission to "issue such rules, regulations, orders, and instructions as it deems necessary and appropriate to carry out its responsibilities" and requires Federal agencies to "comply with such rules, regulations, orders, and instructions." 29 U.S.C. § 633a(b). As we stated in Matheny and reiterated in Mirabal, this language provides for a waiver of sovereign immunity. The Commission has determined that sanctions, including monetary sanctions, are "necessary and appropriate to carry out its responsibilities" under the ADEA. Accordingly, the AJ properly exercised Commission authority when she imposed monetary sanctions on the Agency because of its failure to comply with the AJ's orders. As the AJ noted in the decision on the merits and in the Order on Complainant's Request for Sanctions, the ADEA "does not authorize an award of attorney's fees to a complainant who prevails on an age claim in an administrative forum." Steinbach v. Dep't of the Army, EEOC Request No. 05931045 (July 21, 1994); see also Complainant v. Dep't of Health and Human Servs., EEOC Appeal No. 0120132480 (Nov. 5, 2013); request to reconsider denied, EEOC Request No. 0520140091 (Apr. 29, 2014); Adkins, supra. This is because, unlike Section 717 of Title VII, Section 15 of the ADEA does not contain a provision authorizing an award of attorney's fees to a prevailing party. Compare 29 U.S.C. § 2000e-16(d) (incorporating by reference § 2000e-5(k) attorney's fees provision) with 29 U.S.C. § 633a (no reference to attorney's fees for prevailing parties). Thus, Commission regulations provide for an award of attorney's fees and costs to a party who prevails on a Title VII claim but not to a party who prevails on an ADEA claim. 29 C.F.R. § 1614.501(e). Accordingly, the AJ did not award attorney's fees and costs to Complainant pursuant to 29 C.F.R. § 1614.501(e). Instead, the AJ imposed monetary sanctions pursuant to 29 C.F.R. § 1614.109(f)(3). As noted above, Section 15 of the ADEA provides for a waiver of sovereign immunity, and monetary sanctions are "necessary and appropriate to carry out [the Commission's] responsibilities." See 29 U.S.C. § 633a(b); Matheny, supra. Further, an award of attorney's fees and costs as a sanction is substantively different from an award of attorney's fees to a prevailing party. Stull, supra. The AJ did not, as the Agency asserts on appeal, award attorney's fees "recast as sanctions." We find, therefore, that the AJ's award of monetary sanctions in this case was appropriate. CONCLUSION Based on a thorough review of the record and the contentions on appeal, including those not specifically addressed herein, we MODIFY the Agency's final order. We REVERSE the final order's rejection of the AJ's award of monetary sanctions against the Agency and REMAND the complaint to the Agency for further processing. ORDER (C0610) The Agency is ordered to take the following remedial action: 1. Within thirty (30) calendar days, the Agency shall pay Complainant $7,0120.50 in attorney's fees as a sanction for the Agency's failure to timely and fully produce discovery and comply with the AJ's orders. The Agency is further directed to submit a report of compliance, as provided in the statement entitled "Implementation of the Commission's Decision." The report shall include supporting documentation verifying that the corrective action has been implemented. IMPLEMENTATION OF THE COMMISSION'S DECISION (K0610) Compliance with the Commission's corrective action is mandatory. The Agency shall submit its compliance report within thirty (30) calendar days of the completion of all ordered corrective action. The report shall be submitted to the Compliance Officer, Office of Federal Operations, Equal Employment Opportunity Commission, P.O. Box 77960, Washington, DC 20013. The Agency's report must contain supporting documentation, and the Agency must send a copy of all submissions to the Complainant. If the Agency does not comply with the Commission's order, the Complainant may petition the Commission for enforcement of the order. 29 C.F.R. § 1614.503(a). The Complainant also has the right to file a civil action to enforce compliance with the Commission's order prior to or following an administrative petition for enforcement. See 29 C.F.R. §§ 1614.407, 1614.408, and 29 C.F.R. § 1614.503(g). Alternatively, the Complainant has the right to file a civil action on the underlying complaint in accordance with the paragraph below entitled "Right to File a Civil Action." 29 C.F.R. §§ 1614.407 and 1614.408. A civil action for enforcement or a civil action on the underlying complaint is subject to the deadline stated in 42 U.S.C. 2000e-16(c) (1994 & Supp. IV 1999). If the Complainant files a civil action, the administrative processing of the complaint, including any petition for enforcement, will be terminated. See 29 C.F.R. § 1614.409. STATEMENT OF RIGHTS - ON APPEAL RECONSIDERATION (M0610) The Commission may, in its discretion, reconsider the decision in this case if the Complainant or the Agency submits a written request containing arguments or evidence which tend to establish that: 1. The appellate decision involved a clearly erroneous interpretation of material fact or law; or 2. The appellate decision will have a substantial impact on the policies, practices, or operations of the Agency. Requests to reconsider, with supporting statement or brief, must be filed with the Office of Federal Operations (OFO) within thirty (30) calendar days of receipt of this decision or within twenty (20) calendar days of receipt of another party's timely request for reconsideration. See 29 C.F.R. § 1614.405; Equal Employment Opportunity Management Directive for 29 C.F.R. Part 1614 (EEO MD-110), at 9-18 (November 9, 1999). All requests and arguments must be submitted to the Director, Office of Federal Operations, Equal Employment Opportunity Commission, P.O. Box 77960, Washington, DC 20013. In the absence of a legible postmark, the request to reconsider shall be deemed timely filed if it is received by mail within five days of the expiration of the applicable filing period. See 29 C.F.R. § 1614.604. The request or opposition must also include proof of service on the other party. Failure to file within the time period will result in dismissal of your request for reconsideration as untimely, unless extenuating circumstances prevented the timely filing of the request. Any supporting documentation must be submitted with your request for reconsideration. The Commission will consider requests for reconsideration filed after the deadline only in very limited circumstances. See 29 C.F.R. § 1614.604(c). COMPLAINANT'S RIGHT TO FILE A CIVIL ACTION (T0610) This decision affirms the Agency's final decision/action in part, but it also requires the Agency to continue its administrative processing of a portion of your complaint. You have the right to file a civil action in an appropriate United States District Court within ninety (90) calendar days from the date that you receive this decision on both that portion of your complaint which the Commission has affirmed and that portion of the complaint which has been remanded for continued administrative processing. In the alternative, you may file a civil action after one hundred and eighty (180) calendar days of the date you filed your complaint with the Agency, or your appeal with the Commission, until such time as the Agency issues its final decision on your complaint. If you file a civil action, you must name as the defendant in the complaint the person who is the official Agency head or department head, identifying that person by his or her full name and official title. Failure to do so may result in the dismissal of your case in court. "Agency" or "department" means the national organization, and not the local office, facility or department in which you work. If you file a request to reconsider and also file a civil action, filing a civil action will terminate the administrative processing of your complaint. RIGHT TO REQUEST COUNSEL (Z0610) If you decide to file a civil action, and if you do not have or cannot afford the services of an attorney, you may request from the Court that the Court appoint an attorney to represent you and that the Court also permit you to file the action without payment of fees, costs, or other security. See Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq.; the Rehabilitation Act of 1973, as amended, 29 U.S.C. §§ 791, 794(c). The grant or denial of the request is within the sole discretion of the Court. Filing a request for an attorney with the Court does not extend your time in which to file a civil action. Both the request and the civil action must be filed within the time limits as stated in the paragraph above ("Right to File a Civil Action"). FOR THE COMMISSION: ______________________________ Carlton M. Hadden, Director Office of Federal Operations August 7, 2015 Date 1 The Agency first announced the vacancies on September 14, 2010, but canceled the initial vacancy announcement because it did not correctly describe the "screen-out element." 2 On April 6, 2015, Complainant submitted a "Petition for Enforcement of Final Decision" in which he asserted that the Agency has paid only part of the back pay due to him. Citing 29 C.F.R. §§ 1614.502(a), 1614.503, and 1614.504, Complainant sought "enforcement of the EEOC's Order." The Agency filed a reply on April 28, 2015. Complainant's submission has been docketed as EEOC Appeal No. 0120152443 and is pending adjudication. --------------- ------------------------------------------------------------ --------------- ------------------------------------------------------------ 2 0720130011 U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of Federal Operations P.O. Box 77960 Washington, DC 20013 2 0720130011