Skalka v. Fernald Environmental Restoration Management Corp., s. 97-3493

CourtUnited States Courts of Appeals. United States Court of Appeals (6th Circuit)
Citation178 F.3d 414
Docket NumberNos. 97-3493,98-3122 and 98-3123,s. 97-3493
PartiesRobert J. SKALKA; Joseph L. Balnites, Sr.; William E. Ponsock; Charles D. Conover, III, Plaintiffs-Appellees (97-3493; 98-3123), Charles D. Conover, III, Plaintiff-Appellee/Cross-Appellant (98-3122), v. FERNALD ENVIRONMENTAL RESTORATION MANAGEMENT CORPORATION; Fluor Daniel, Inc., Defendants-Appellants (97-3493; 98-3123)/Cross-Appellees (98-3122).
Decision Date19 May 1999

178 F.3d 414
Robert J. SKALKA; Joseph L. Balnites, Sr.; William E.
Ponsock; Charles D. Conover, III,
Plaintiffs-Appellees (97-3493; 98-3123),
Charles D. Conover, III, Plaintiff-Appellee/Cross-Appellant (98-3122),
Fluor Daniel, Inc., Defendants-Appellants
(97-3493; 98-3123)/Cross-Appellees (98-3122).
Nos. 97-3493, 98-3122 and 98-3123.
United States Court of Appeals,
Sixth Circuit.
Argued Jan. 29, 1999.
Decided May 19, 1999.

Robert G. Stachler (briefed), Doreen Canton (argued and briefed), Caleb E. Nelson (briefed), Taft, Stettinius & Hollister, Cincinnati, Ohio, Daniel G. Rosenthal (briefed), Denlinger, Rosenthal & Greenberg, Cincinnati, Ohio, for Defendants-Appellants/Cross-Appellees.

Randolph H. Freking (argued and briefed), Freking & Betz, Cincinnati, Ohio, for Plaintiffs-Appellees/Cross-Appellant.

Before: MERRITT, GUY, and MOORE, Circuit Judges.


MOORE, Circuit Judge.

Robert Skalka, Joseph Balnites, William Ponsock, and Charles Conover sued their former employer, Fernald Environmental Restoration Management Corporation ("FERMCO"), and its parent company, Fluor Daniel, Inc., for age discrimination and breach of contract. A jury found for Skalka and Conover on the age discrimination claim and for all four plaintiffs on the breach of contract claim. The jury also awarded substantial damages. The district court accepted the jury's verdict except for the finding in favor of Conover on the breach of contract claim, and the court entered judgment accordingly.

FERMCO appeals, arguing that virtually all of the jury's decisions on liability and damages were not supported by sufficient evidence. Conover cross-appeals on the breach of contract claim. We AFFIRM the age-discrimination judgment for Skalka and REVERSE the age-discrimination judgment for Conover. We AFFIRM the contract judgment against Conover and REVERSE the contract judgments for the rest of the plaintiffs. We also conclude that there were errors in the plaintiffs' favor in the calculation of damages, and, therefore, we must REMAND this case so the district court can determine an appropriate remittitur, and, in the event of Skalka's failure to remit the amount determined, order a new trial on the issue of damages.


The four plaintiffs in this case worked at a site owned by the federal government in Hamilton County, Ohio, where various contractors once produced uranium and others now clean up the waste. FERMCO took over clean-up responsibilities in December 1992, expecting to spend about fifteen years on the project. The following August it laid off approximately 120 salaried employees (and sixty more who left voluntarily). According to an Inspector General's report, this reduction in force was inefficient and did not substantially reduce the workforce, since many of the discharged employees were eventually replaced. FERMCO attributes some of the problems criticized by the Inspector General to the vagaries of the budget process and to the large sums it spent on severance packages in order to accomplish the reduction in force. The plaintiffs imply that such a blatantly ineffective "reduction" in force must have been a pretext for getting rid of unwanted employees.

When it decided to reduce its workforce, FERMCO developed a "forced ranking" process to decide whom to lay off. Employees were classified into "peer groups," and supervisors for each group evaluated their subordinates on various skills in order to produce a ranked list. Top management officials decided which departments would lose employees, and the manager of each department used the forced rankings to decide which employees would go. FERMCO assured its employees that the selection process would be fair and objective, that the company would try to find new jobs for people, and that an appeals process would provide for meaningful review of the decision to terminate any particular employee.

At the time of the layoffs, Skalka was 54 years old and had several years of experience at the site. He worked in the Remedial Support Operations Group ("RSO"), and he reported to Timothy Huey. His peer group included four other RSO representatives ("RSOs") who reported to Huey; the others were all younger than Skalka. Although they were classified together, the RSOs worked in separate parts of FERMCO, each providing support services to a particular department. By the time of this litigation, FERMCO claimed to have lost the rating forms for the rest of Skalka's peer group. However, Skalka received a near-perfect score (4.74 out of 5.0), and his score was better than Jim Golden's. J.A. at 499, 502. 1

Despite Skalka's superior rating and performance, he was laid off because the department to which he had been assigned no longer needed an RSO. No other RSOs in his peer group were laid off. Skalka claims that the RSO with the lowest rating should have been laid off and that he should have been moved to that person's position. He notes that a year later, when the RSO position was eliminated entirely, FERMCO transferred the four younger employees to other jobs.

FERMCO responds that Huey was responsible for ranking Skalka's peer group only because he was above them in the organizational hierarchy. He actually knew little or nothing about their performance, so FERMCO did not base any decisions on his rankings. In addition, Skalka may have anticipated the elimination of his position, since he worked on his resume before the layoffs were announced.

Conover also had several years of experience at the FERMCO site and was 47 at the time of the layoffs. He introduced some testimony that he did a good job, but he was ranked last in his five-person peer group. Two members of the group were older than he was: Donald Liepold was 48, almost 49; Paul Simons was 47 but a few months older than Conover; Eric Meuser was 40; and Paul Sturgeon was 35. J.A. at 313-16, 701-02. The group was ranked by Gwen Nalls and Louis Henke. Among a number of irregularities in the rating process were numerous mathematical and typographical errors on this peer group's rating forms. However, it appears that the only errors that actually affected the scores were in Conover's favor.

Conover claims that Henke selectively solicited older employees for "voluntary" termination. He also claims that Henke is somehow implicated in another manager's statement that some employees would be laid off because they were "too comfortable" in their jobs. Skalka Br. at 5. Conover argues that he should have been retained instead of several younger employees, including his peer group and his subordinates.

Ponsock and Balnites were also laid off after being ranked at the bottoms of their peer groups.

Ponsock, Balnites, and Skalka all filed internal appeals of their terminations. They allege that the appeals process was a sham, consisted only of asking each appellant's manager if correct procedures were followed, and did not result in overturning any layoff decisions.

FERMCO conducted a statistical study of the effects of the layoffs, and a preliminary report found "borderline" results in certain divisions, including Conover's and Balnites's, indicating a possible disparate impact on older workers. J.A. at 466-68. FERMCO's expert witness testified that, upon further investigation, the result was found not to be statistically significant. J.A. at 742-43. The plaintiffs criticize this conclusion because it was based on the assumption that all groups should be equally affected, while they assert that older workers, because of their greater experience, should have been disproportionately unaffected by the layoffs. They offer FERMCO's failure to follow up on this statistical red flag as evidence that the company's violations of the Age Discrimination in Employment Act ("ADEA") were willful.

All four plaintiffs claim that FERMCO discriminated on the basis of age, in violation of state and federal law, and that FERMCO is liable for breach of contract and/or promissory estoppel for breaking its promise that the layoff procedures would be fair and allow for meaningful review. The contract claim and the federal discrimination claim were tried to a jury, which found that FERMCO had discriminated against Skalka and Conover and awarded them back pay and front pay. Because the jury also found that the violations were willful, the back-pay award was doubled. Although the jury rejected Ponsock's and Balnites's age discrimination claims, it found for all plaintiffs on their contract/promissory estoppel claims and awarded damages. With some complications discussed below, the district court eventually entered judgment in accordance with the jury's verdict, except that it granted FERMCO's motion for judgment on Conover's contract claim because he had failed to pursue an internal appeal of his termination.

FERMCO appeals, claiming that there was insufficient evidence to support the findings of liability, and insufficient evidence that any violations of the ADEA were willful. It also has several complaints about the damages calculations. Conover cross-appeals the judgment notwithstanding the verdict on his contract claim.



A prima facie case of age discrimination consists of four elements: (1) the plaintiff was a member of the protected class, which is people at least forty years old; (2) he or she was discharged; (3) he or she was qualified for the position; and (4) he or she was replaced by a younger person. See Phelps v. Yale Security, Inc., 986 F.2d 1020,1023 (6th Cir.), cert. denied, 510 U.S. 861, 114 S.Ct. 175, 126 L.Ed.2d 135 (1993). In the context of a reduction in force, the fourth requirement is modified to require the plaintiff to offer some "direct, circumstantial, or statistical evidence tending to indicate that the employer singled out the plaintiff for discharge for impermissible reasons." Barnes v. GenCorp Inc., 896 F.2d 1457, 1465 (6th...

To continue reading

Request your trial
99 cases
  • Lopez v. Aramark Uniform & Career Apparel, Inc., C03-4015-MWB.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • April 13, 2006 which she earned an equal or higher salary then she would have earned at Aramark, see Skalka v. Fernald Envtl. Restoration Mgmt. Corp., 178 F.3d 414, 426 (6th Cir.1999) (citing EEOC v. N.Y. Times Broad. Serv., Inc., 542 F.2d 356, 359 (6th Cir.1976)), what the defendant's argument complet......
  • Associated General Contractors v Drabik, 00-3104
    • United States
    • United States Courts of Appeals. United States Court of Appeals (6th Circuit)
    • May 23, 2001
    ...that is subsequently set aside is not ascertained in a meaningful way. See, e.g., Skalka v. Fernald Envtl. Restoration Mgmt. Corp, 178 F.3d 414, 429 (6th Cir. 1999) (stating that "post-judgment interest runs from the date of any judgment that is not entirely set aside). But here, in contras......
  • Gaffney v. Riverboat Services of Indiana, 04-3829.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • June 16, 2006
    ...are not to be subtracted from the back-pay award for the period of unemployment." Skalka v. Fernald Envtl. Restoration Mgmt. Corp., 178 F.3d 414, 426 (6th Cir.1999) (discussing back pay for violation of the ADEA). Indeed, Riverboat has referred us to no case in which the plaintiffs' excess ......
  • Skretvedt v. E.I. Dupont De Nemours, 02-3620, 02-4283.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
    • June 16, 2004
    ...of the initial, partial judgment ..., even though that judgment was not yet appealable." Skalka v. Fernald Envtl. Restoration Mgmt. Corp., 178 F.3d 414, 429 (6th 34. We expressed this concern in Brock v. Richardson, 812 F.2d 121 (3d Cir.1987): In Perkins v. Fourniquet, 55 U.S. (14 How.) 328......
  • Request a trial to view additional results
2 books & journal articles
  • Remedies available under the adea
    • United States
    • James Publishing Practical Law Books Age Discrimination Litigation
    • April 28, 2022 the event plainti൵ inds a better paying job after being terminated. In Shalka v. Fernald Environmental Restoration Management Corp. , 178 F.3d 414, 426 (6th Cir. 1999), the Sixth Circuit held that, “Shalka is not entitled to back pay for any period in which he earned an equal or higher s......
  • Age discrimination
    • United States
    • James Publishing Practical Law Books Federal Employment Jury Instructions - Volume I
    • April 30, 2014
    ...persons outside the protected class were retained in the same position. Skalka v. Fernald Environmental Restoration Management Corp. , 178 F.3d 414, 420-21 (6th Cir. 1999); see also Godfredson v. Hess & Clark, Inc. , 173 F.3d 365, 372 (6th Cir. 1999). Seventh: In ADEA action arising out of ......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT