The Department of Energy’s War on Whistleblowers

The government uses taxpayer dollars to help corporate contractors retaliate against workers who expose unsafe practices at US nuclear facilities.

Image: Cal Joy

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Randall Walli is a certified pipefitter with more than 20 years experience, 14 as a foreman. A soft-spoken man of 42, he lives with his wife and three sons in Richland, a small city in eastern Washington. The town where Walli has lived all his life is dwarfed by the nearby Hanford Nuclear Facility, 560 square miles owned by the Department of Energy but operated by several private contractors.

In 1997, Walli was employed by Fluor Daniel, one of the main contractors at Hanford. He and his crew worked amid more than 54 million gallons of nuclear and non-nuclear toxic waste stored in underground tanks that had a propensity to leak. The crew helped install miles of pipes meant to carry waste from the defective tanks to more secure storage in other parts of the facility, a crucial part of the multi-billion-dollar cleanup of the former weapons plant.

According to court documents filed in his ongoing suit against Fluor Daniel, Walli and his crew were alarmed to discover that certain valves meant for their pipe system might not be strong enough to withstand the expected flow, an oversight that could have led to toxic leaks, worker deaths, and nuclear contamination of the area. When the crew raised these concerns, they weren’t commended for their vigilance. They were fired.

The incident is not unique among the DOE’s “Government Owned, Contractor Operated” sites across the nation, aging facilities that steward more than 700,000 metric tons of nuclear materials. Scores of DOE and contractor employees are retaliated against for raising safety, security and environmental concerns every year. Retaliation against whistleblowers like Walli has been an issue at these sites for decades. In a 1993 speech, then-Secretary of Energy, Hazel O’Leary declared “zero tolerance” for retaliation against whistleblowers, admitting, “These facilities are dangerous … I need whistleblowers.”

But O’Leary’s former agency seems to think otherwise. In fact, the DOE actually facilitates the crackdown on whistleblowers by using taxpayer dollars to pay litigation costs and settlements for contractors who fight retaliation claims through years of hearings and appeals, a practice that costs the public tens of millions of dollars annually.

Not every whistleblower case has merit, of course, and there are a variety of internal grievance procedures available to workers with safety and environmental concerns. However, there are clearly limits to the effectiveness of such self-policing when billions of dollars are at stake for the companies involved.

Nor is there adequate outside oversight. For instance, a 1988 congressional mandate that required the DOE to set up a system of penalties for contractors who violate safety and environmental regulations has been implemented only partially. After 12 years, the department has promulgated only two of the 11 proposed rules, and the office established to enforce the program at dozens of DOE facilities nationwide is staffed by only nine people, who rely on contractors to self-report.

As a senior DOE safety official wrote in a recent report on a Texas nuclear facility, “Those of us who help cover up deficiencies are rewarded, and those that bring them to the fore … are at best ignored, resented, or dismissed as troublemakers.”

Firing is only one form of retaliation contractors use against whistleblowers. Other methods include poor performance evaluations, enforced isolation, claims of security breaches, and blacklisting. Some companies even use psychiatrists to misdiagnose whistleblowers as having mental disorders. In 1999 a Tennessee court found Kenneth Carpenter, a DOE-contracted psychiatrist, guilty of malpractice after he falsely diagnosed a nuclear whistleblower as having “paranoid delusional disorder.” The diagnosis cost the whistleblower her security clearance and her job.

The practice of DOE litigation-reimbursement goes back to the Cold War. In those years, an emphasis on weapons production and secrecy encouraged a fortress mentality that saw all grievances as threats to national security.

Since the vast majority of the work performed under DOE auspices is done by private contractors, it followed that the government had to back them up against disgruntled workers. Robert Alvarez, a former senior advisor to the secretary of energy, explains that the DOE “has always been a doormat to its contractors. They’re administrative types. They dole out money.”

And when it comes to crushing whistleblowers, the DOE doles out a lot of money. The federal General Accounting Office has found that the DOE spent approximately $40 million in 1992 alone to defend its contractors in court. One case included payments to 10 separate law firms with 62 attorneys billing up to $200 per hour, running up costs of half a million dollars in just one month.

Jackie Kittrell, a lawyer who has taken on retaliatory contractors at a DOE facility in Tennessee, says the department operates on a “floodgate principle,” hoping to “chill any further suits” against its contractors by consistently backing them in court.

There is, however, more than Cold War tradition and shortsighted thinking keeping taxpayer money in the fight against whistleblowers. The main contractors at DOE facilities include some of the largest corporate lobbyists and campaign contributors around. Companies such as Westinghouse, ICF Kaiser, Bechtel and Wackenhut all have an interest in seeing the DOE and its contractors remain a self-regulated fiefdom — and all pump hundreds of thousands of soft-money dollars into Democratic and Republican coffers each year.

Moreover, a constantly revolving door shuttles executives between DOE policy positions and lucrative spots at top nuclear contractors. In 1999, for example, after nine years as DOE site manager at Hanford, John D. Wagoner retired to take a job with Informatics Corporation, a company that is subcontracted to “provide technical, administrative, and regulatory compliance support” for the Hanford facility.

Another former DOE employee, John Wilcynski, who once managed the Idaho National Engineering and Environmental Laboratory,went to work last October for British Nuclear Fuels, Ltd., which currently holds a $1.2 billion contract at INEEL. He began his new job just two weeks after emailing his DOE superiors to protest a proposed nuclear safety regulation. “We place a significant burden on our contractors. We deny them full flexibility to choose their workforce, challenge them with aged and underfunded facilities,” Wilcynski wrote. “Yet we seek to impose a more onerous environment of more fines and penalties.”

Even Hazel “zero tolerance” O’Leary now sits on the board of directors for a DOE contractor, ICF Kaiser . When questioned about possible conflicts of interest after accepting the position, O’Leary told reporters, simply, “It ain’t so, Joe.”

After years of criticism from Congress and the GAO, the DOE in recent years has begun including language in its contracts that relieves the department of the obligation to reimburse contractors that a jury finds guilty of reprisal. Yet, there is evidence that in some cases, the DOE continues to pay regardless.

Furthermore, the agency never stopped funding contractors who fight whistleblowers in and out of court for years, only to offer a settlement at the last minute. One union representing thousands of workers at DOE facilities calls such delays “one of the most effective ways for an employer to retaliate against whistleblowers. The worker is left sitting on the outside with no means of support.”

Walli and his fellow plaintiffs have now spent three years in an out of work. Few contractors in the area will hire them, says Walli, because Fluor Daniel has branded them troublemakers. Most recently, Walli found work at a paper mill, but the job ended after a few months. “I don’t really know of any of us that can afford this,” Walli says. “Most either just scrape by or run up credit card debt.”

Their lawyers work for the non-profit Government Accountability Project, which bills them only for expenses like filing fees and phone calls. “If it weren’t for the way [our lawyers] operate, there’s no way any of us could have kept fighting this,” Walli says

The DOE, on the other hand, has already spent hundreds of thousands of dollars reimbursing Flour Daniel’s multi-year fight against Walli and his crew, despite a finding in the pipefitters’ favor by the Department of Labor and an initial settlement agreement.

The settlement included reinstatement for the pipefitters. But most of them were fired again within six months, along with several other employees who’d supported them, prompting the fired workers to launch the current suit against Fluor Daniel. The company claims the lay-offs of these veteran and highly-skilled workers were due to “lack of work.”

“I can state categorically,” Ron Hanson, president of Fluor Hanford, Inc., assured reporters last May, “that retaliation of any kind against any employee of Fluor is neither condoned nor tolerated. I take the responsibility for ensuring a safety conscious working environment very seriously.”

A new trial is now set for this May.

Last spring, the congressional subcommittee on oversight and investigations held the latest of its several hearings on the issue of DOE whistleblowers. Committee chairman Tom Bliley, a Virginia Republican, wrote a letter admonishing Secretary of Energy Bill Richardson about whistleblower retaliation. “DOE is unwilling to actively enforce your zero tolerance policy,” Bliley wrote. “Your lack of attention to these matters may have already created a chilling effect throughout the DOE complex, making employees afraid to raise legitimate safety concerns.”

Mary Ann Sullivan, the lawyer who heads DOE’s legal department, defended the agency’s contractor-litigation reimbursement to the Environmental News Service in May. “Zero tolerance does not mean that every whistleblower claim must be accepted as valid without an opportunity for response or appeal by the department’s contractors,” she said.

The congressional committee has yet to issue any formal conclusions.

Meanwhile, the DOE’s legal office says no determination will be made on how fully taxpayers will reimburse Fluor Daniel until the Walli case has been concluded. But a recent agency declaration to the court is telling. The declaration is by a DOE lawyer arguing to withhold evidence by asserting attorney-client privilege between the department and Fluor Daniel. The DOE and its contractor “share a common interest in this litigation,” the lawyer insisted. His statement goes on to explain that “DOE has an interest in the appropriate resolution of whistleblower actions, takes financial responsibility in the case of successful defense of such claims, and has discretion under the contract, to fund the defense even after an `adverse determination’ has been made.”

With no outside oversight of the DOE and its contractors besides the occasional congressional hearing, America’s nuclear facilities will most likely remain within what Robert Alvarez, the former senior DOE official dubbed, “a highly-scattered and fragmented system with few enforceable rules.” Meanwhile, the Walli case and countless other acts of federally funded whistleblower retaliation continue to send a clear message to workers who spot safety and environmental dangers: keep your mouth shut.


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