EA-95-199 - Sequoyah 1 & 2 (Tennessee Valley Authority)

January 13, 1997

EA 95-199

Tennessee Valley Authority
ATTN: Mr. Oliver D. Kingsley, Jr.
President, TVA Nuclear and
Chief Nuclear Officer
6A Lookout Place
1101 Market Street
Chattanooga, Tennessee 37402-2801

SUBJECT: NOTICE OF VIOLATION AND PROPOSED IMPOSITION OF CIVIL PENALTY - $100,000 (NRC Office of Investigation Report No. 2-93-015 and Department of Labor Administrative Law Judge Recommended Decision and Order, dated July 31, 1996)

Dear Mr. Kingsley:

This refers to the investigation conducted by the Nuclear Regulatory Commission (NRC) Office of Investigations (OI) during the period July 7, 1994, through August 31, 1995, and the Department of Labor (DOL) Recommended Decision and Order (RDO) issued on July 31, 1996, in DOL Case No. 94-ERA-24, William F. Jocher v. Tennessee Valley Authority (TVA). Both the NRC investigation and the DOL Administrative Law Judge (ALJ) concluded that TVA discriminated against Mr. Jocher, the former Manager, Chemistry and Environmental Protection in the corporate organization and a former Chemistry Manager at the Sequoyah Nuclear Plant, when he was forced to resign under threat of termination on April 5, 1993, because he had engaged in protected activities. Mr. Jocher's protected activities were primarily associated with operations at the Sequoyah Nuclear Plant and included: (1) raising questions about the licensee's ability to acquire a timely sample from the post-accident sampling system; (2) voicing concerns regarding the operation of on-line chemistry instrumentation; and (3) questioning the accuracy of training commitments associated with the chemical traffic control program.

In a letter dated August 16, 1996, the NRC discussed the apparent violation and requested that TVA attend a predecisional enforcement conference. By letter dated August 27, 1996, TVA declined the opportunity to participate in a conference and committed to provide a written response to the apparent violation by September 26, 1996. Based on TVA's declination of a conference and NRC's need to acquire additional information prior to making a final enforcement decision in the case, the NRC, by letter of September 10, 1996, requested TVA to respond to five specific questions pursuant to

10 CFR 50.54(f). By letter dated September 25, 1996, TVA provided its response and set forth its position on the apparent violation, described its assessment of the current work environment at TVA, and delineated the corrective actions implemented in response to Mr. Jocher's employment action. We have reviewed this response, the DOL decision, and OI investigation findings in this case and have concluded that sufficient information is available to determine the appropriate enforcement action in this matter.

Based on the information developed in this case, the NRC has determined that a violation of NRC requirements occurred. The violation is cited in the enclosed Notice of Violation and Proposed Imposition of Civil Penalty (Notice) and involves the failure of TVA to adhere to the requirements of 10 CFR 50.7, Employee Protection, which prohibits discrimination against employees for engaging in protected activities. In its response of September 25, 1996, TVA stated that mistakes were made by TVA personnel who failed to follow appropriate personnel practices with respect to Mr. Jocher's resignation; however, TVA denied that a violation of Section 211 of the Energy Reorganization Act or 10 CFR 50.7 occurred. Despite TVA's denial, it is our view, based on a review of the decision of the DOL ALJ and the evidence gathered by the NRC's independent investigation, that the facts support the conclusions that Mr. Jocher's involvement in protected activities was a factor in the adverse employment action taken against him and that TVA violated the regulations applicable to employee protection as stated above.

The violation is of very significant regulatory concern because it involved an act of employee discrimination by a senior corporate manager. Although discrimination by any licensee employee is of concern, discrimination by a senior official, in this case the Vice President of Nuclear Operations, cannot be tolerated. The sphere of influence of such an individual is significant, and the impact of discrimination committed at this level has the potential to affect the environment throughout the company. The NRC places a high value on the freedom of nuclear industry employees to raise potential safety concerns to licensee management or to the NRC. The Energy Reorganization Act and 10 CFR 50.7 establish strict requirements for the protection of employees against discrimination for raising nuclear safety issues, and the NRC Enforcement Policy calls for significant enforcement action in cases where senior corporate management violate these requirements. Therefore, this violation has been categorized in accordance with the "General Statement of Policy and Procedures for NRC Enforcement Actions" (Enforcement Policy), NUREG-1600, at Severity Level I.

In accordance with the Enforcement Policy, a base civil penalty in the amount of $100,000 is considered for a Severity Level I violation. In this case, the NRC considered whether credit was warranted for Identification and Corrective Action in accordance with the civil penalty assessment process in Section VI.B.2 of the Enforcement Policy. The NRC determined that credit for Identification was not appropriate because the violation was identified by the DOL and NRC OI, not by the licensee. In TVA's letter of September 25, 1996, the violation was denied; however, a description of the actions taken to improve the work environment as well as those initiated in response to this case were provided. These actions included: (1) additional training and guidance for senior managers in the proper handling of personnel matters; (2) institution of a leadership development program for managers and supervisors at the Sequoyah Plant in March 1996; (3) initiation of efforts to comply with the ALJ's RDO and/or to resolve the case to avoid further litigation; (4) issuance of an August 7, 1996, communication to all TVA employees emphasizing open communications and transmittal of specific guidance concerning this topic to senior managers on August 14, 1996; and (5) issuance of letters of reprimand following the DOL ALJ decision to the officer and the other managers involved in this case for failure to follow personnel practices.

Notwithstanding the actions mentioned above, the NRC has determined that credit is not warranted for the factor of Corrective Action in that the corrective action implemented in response to Mr. Jocher's case addressed the root cause identified by TVA (i.e., the failure to adhere to personnel practices) rather than discrimination. In addition, the actions taken were not timely. Specifically, the actions implemented in response to Mr. Jocher's case were not taken until after the ALJ's decision was issued on July 31, 1996, when in fact, TVA was put on notice of the discrimination finding much earlier by the DOL District Director's Decision issued on April 29, 1994, and the conclusions of the OI investigation transmitted to TVA by NRC letter dated November 9, 1995. Your failure to comply with the remedy prescribed by the DOL District Director does not lead the NRC to conclude that timely and comprehensive corrective action was taken in this case.

Based on the severity level of the violation and NRC's determinations regarding Identification and Corrective Action, a civil penalty in an amount twice the base would normally be assessed. However, consistent with Section 234 of the Atomic Energy Act of 1954, as amended, 42 U.S.C. 2282, the maximum civil penalty for a single violation, at the time of this violation, may not exceed $100,000 per day. Therefore, to emphasize the importance of ensuring that employees who raise real or perceived safety concerns are not subject to discrimination for raising those concerns and that every effort is made to provide an environment in which all employees may freely identify safety issues without fear of retaliation or discrimination, I have been authorized, after consultation with the Commission to issue the enclosed Notice of Violation and Proposed Imposition of Civil Penalty in the maximum amount of $100,000 for the Severity Level I violation.

In addition, you should be aware that an Order was also issued to the senior corporate officer responsible for the discrimination in this case prohibiting his involvement in NRC-licensed activities for a period of five years. However, the Order is retroactive to May 1, 1993, the general time period in which he was transferred out of TVA-Nuclear to a non-nuclear position, and will be effective until April 30, 1998.

The NRC has concluded that information regarding TVA's position on the violation and the corrective actions taken and planned is addressed on the docket in the licensee's letter to NRC, dated September 25, 1996. Therefore, TVA is not required to respond to the Notice as required by 10 CFR 2.201 unless the description therein does not accurately reflect TVA's corrective actions or position. In that case, or if you choose to provide additional information, you should follow the instructions specified in the enclosed Notice.

In accordance with 10 CFR 2.790 of the NRC's "Rules of Practice," a copy of this letter, its enclosure, and any response you may provide will be placed in the NRC Public Document Room (PDR).

Sincerely, Luis A. Reyes Regional Administrator

Docket Nos. 50-327, 50-328
License Nos. DPR-77, DPR-79

Enclosure: Notice of Violation and Proposed
Imposition of Civil Penalty

cc w/encl:
O. J. Zeringue, Senior Vice President
Nuclear Operations
Tennessee Valley Authority
6A Lookout Place
1101 Market Street
Chattanooga, TN 37402-2801

Dr. Mark O. Medford, Vice President
Technical Services
Tennessee Valley Authority
6A Lookout Place
1101 Market Street
Chattanooga, TN 37402-2801

R. J. Adney
Site Vice President
Sequoyah Nuclear Plant
Tennessee Valley Authority
P. O. Box 2000
Soddy-Daisy, TN 37379

General Counsel
Tennessee Valley Authority
ET 10H
400 West Summit Hill Drive
Knoxville, TN 37902

Raul Baron, General Manager
Nuclear Assurance and Licensing
Tennessee Valley Authority
4J Blue Ridge
1101 Market Street
Chattanooga, TN 37402-2801

Pedro Salas, Manager
Licensing and Industry Affairs
Tennessee Valley Authority
4J Blue Ridge
1101 Market Street
Chattanooga, TN 37402-2801

Ralph H. Shell, Manager
Licensing and Industry Affairs
Sequoyah Nuclear Plant
P. O. Box 2000
Soddy-Daisy, TN 37379

Michael H. Mobley, Director
Division of Radiological Health
3rd Floor, L and C Annex
401 Church Street
Nashville, TN 37243-1532

County Executive
Hamilton County Courthouse
Chattanooga, TN 37402

Mr. William F. Jocher
133 Gholdston Drive
Dayton, TN 37321

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NOTICE OF VIOLATION
AND
PROPOSED IMPOSITION OF CIVIL PENALTY

Tennessee Valley Authority Docket Nos. 50-327 and 50-328 Sequoyah Nuclear Plant License Nos. DPR-77 and DPR-79 EA 95-199

As the result of the Nuclear Regulatory Commission (NRC) staff's review of the NRC Office of Investigations investigation completed on August 31, 1995, and a Department of Labor (DOL) Administrative Law Judge (ALJ) Recommended Decision and Order (RDO) issued on July 31, 1996, in DOL Case No. 94-ERA-24, a violation of NRC requirements was identified. In accordance with the "General Statement of Policy and Procedures for NRC Enforcement Actions," NUREG-1600, the NRC proposes to impose a civil penalty pursuant to Section 234 of the Atomic Energy Act of 1954, as amended (Act), 42 U.S.C. 2282, and 10 CFR 2.205. The particular violation and associated civil penalty are set forth below:

10 CFR 50.7 prohibits discrimination by a Commission licensee against an employee for engaging in certain protected activities. Discrimination includes discharge or other actions relating to the compensation, terms, conditions, and privileges of employment. The activities which are protected include, but are not limited to, the reporting of safety concerns by an employee to his employer or the NRC.

Contrary to the above, Tennessee Valley Authority (TVA), through the actions of the former Vice President of Nuclear Operations, discriminated against a management employee, who was a former corporate Manager, Chemistry and Environmental Protection and Chemistry Manager at the Sequoyah Nuclear Plant, for engaging in protected activities. Specifically, as determined by DOL and the NRC Office of Investigations, on April 5, 1993, TVA forced the resignation of Mr. William F. Jocher because he engaged in the identification of deficiencies in the chemistry program and inconsistencies in TVA reports to the NRC and other oversight groups related to activities at the Sequoyah Nuclear Power Plant. (01011)

This is a Severity Level I Violation (Supplement VII).
Civil Penalty - $100,000

The NRC has concluded that information regarding TVA's (licensee) position on the violation and the corrective actions taken and planned is addressed on the docket in the licensee's letter to NRC, dated September 25, 1996. However, the licensee may submit a written statement or explanation pursuant to

10 CFR 2.201 if the description therein does not accurately reflect the corrective actions or the licensee's position. In that case, or if TVA chooses to respond, the response should be marked clearly as a "Reply to a Notice of Violation," and sent to the U. S. Nuclear Regulatory Commission, ATTN: Document Control Desk, Washington, D. C. 20555 with a copy to the Regional Administrator, Region II and the Resident Inspector at Sequoyah Nuclear Plant within 30 days of the date of the letter transmitting this Notice of Violation. Any such response shall be under oath or affirmation.

The licensee may pay the civil penalty by letter addressed to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, with a check, draft, money order, or electronic transfer payable to the Treasurer of the United States in the amount of the civil penalty proposed above or may protest imposition of the civil penalty in whole or in part, by a written answer addressed to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission. Should the licensee fail to answer within the time specified, an order imposing the civil penalty will be issued. Should the licensee elect to file an answer in accordance with 10 CFR 2.205 protesting the civil penalty, in whole or in part, such answer should be clearly marked as an "Answer to a Notice of Violation" and may: (1) deny the violation listed in this Notice, in whole or in part, (2) demonstrate extenuating circumstances, (3) show error in this Notice, or (4) show other reasons why the penalty should not be imposed. In addition to protesting the civil penalty in whole or in part, such answer may request remission or mitigation of the penalty.

Any written answer in accordance with 10 CFR 2.205 should be set forth separately from the statement or explanation in reply pursuant to

10 CFR 2.201, but may incorporate parts of the 10 CFR 2.201 reply by specific reference (e.g., citing page and paragraph numbers) to avoid repetition. The attention of the licensee is directed to the other provisions of 10 CFR 2.205, regarding the procedure for imposing a civil penalty.

Upon failure to pay any civil penalty due which subsequently has been determined in accordance with the applicable provisions of 10 CFR 2.205, this matter may be referred to the Attorney General, and the penalty, unless compromised, remitted, or mitigated, may be collected by civil action pursuant to Section 234c of the Act, 42 U.S.C. 2282c.

The response noted above (Reply to Notice of Violation, letter with payment of civil penalty, and Answer to a Notice of Violation) should be addressed to: Mr. James Lieberman, Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, One White Flint North, 11555 Rockville Pike, Rockville, MD 20852-2738, with a copy to the Regional Administrator, U.S. Nuclear Regulatory Commission, Region II, and a copy to the NRC Resident Inspector at the Sequoyah Nuclear Plant.

Because your response will be placed in the NRC Public Document Room (PDR), to the extent possible, it should not include any personal privacy, proprietary, or safeguards information so that it can be placed in the PDR without redaction. If personal privacy or proprietary information is necessary to provide an acceptable response, then please provide a bracketed copy of your response that identifies the information that should be protected and a redacted copy of your response that deletes such information. If you request withholding of such material, you must specifically identify the portions of your response that you seek to have withheld and provide in detail the bases for your claim of withholding (e.g., explain why the disclosure of information will create an unwarranted invasion of personal privacy or provide the information required by 10 CFR 2.790(b) to support a request for withholding confidential commercial or financial information). If safeguards information is necessary to provide an acceptable response, please provide the level of protection described in 10 CFR 73.21.

Dated at Atlanta, Georgia
this 13th day of January 1997