United States Nuclear Regulatory Commission - Protecting People and the Environment

EA-04-105 - Day and Zimmerman Nuclear Power Systems

September 29, 2004

EA-04-105

Mr. Michael P. McMahon
President
Day and Zimmerman Nuclear Power Systems
1866 Colonial Village Lane, Suite 101
Lancaster, PA 17601

SUBJECT: EXERCISE OF ENFORCEMENT DISCRETION
[NRC OFFICE OF INVESTIGATIONS REPORT NO. 3-2001-033]

Dear Mr. McMahon:

This refers to information provided to the U.S. Nuclear Regulatory Commission (NRC) on July 6, 2001, by a representative of Nuclear Management Company (NMC) concerning alleged employment discrimination at the Point Beach Nuclear Plant. From information obtained during investigations by NMC and the NRC Office of Investigations (OI), an apparent violation of 10 CFR 50.7, "Employee Protection," occurred when a General Foreman, employed by Day and Zimmerman Nuclear Power Systems (D&Z), a contractor at the Point Beach Plant, submitted the name of a D&Z electrician for lay-off on May 4, 2001, following the electrician's protected activities associated with a work package on March 27 and 28, 2001. A copy of the synopsis from the OI report was sent to NMC on April 1, 2004 (NRC Document Control No. ML0409202941).

Based on the information developed during the NMC and OI investigations and information contained in a letter from NMC on May 10, 2004 (NRC Document Control No. ML041330278), the NRC concluded that a violation of NRC requirements occurred. Specifically, on March 27 and 28, 2001, a D&Z electrician and a coworker found that the required signatures of the duty shift supervisor and reviewing engineer were missing from a work package. The electrician and a co-worker stopped work on the assigned project and notified a D&Z supervisor of the problem. A coworker of the electrician prepared a Condition Report on the subject. A D&Z General Foreman learned of the electrician's activities on March 27 and 28, 2001, and on March 30, 2001, that General Foreman threatened to terminate the employment of the electrician for stopping work. The General Foreman stated that his intention on March 30, 2001, was not to terminate the electrician or his coworker, but to separate the two workers from each other because of the excessive number of breaks they took. About April 30, 2001, the electrician was told that he would be retained until the end of the project later in the Summer 2001. The General Foreman subsequently submitted the electrician's name for lay-off on May 4, 2001, in part, because the electrician engaged in protected activities on March 27 and 28, 2001. As a result, the General Foreman changed the compensation, terms, conditions, or privileges of the electrician's employment in violation of 10 CFR 50.7. Additionally, the General Foreman allowed two other electricians laid-off on May 4, 2001, to "hover" (remain immediately eligible for reemployment by D&Z without returning to the local union hall for reassignment). However, the General Foreman did not extend the offer to "hover" to the complainant in this matter. The NRC considered the General Foreman to be a first-line supervisor or other low-level manager within the D&Z organization and categorized the violation in accordance with the "General Statement of Policy and Procedure for NRC Enforcement Actions," NUREG-1600 (Enforcement Policy), at Severity Level III. The NRC also includes Issued Significant Enforcement Actions on its Web site. The NRC staff recognizes that the General Foreman was promoted to that position shortly before the violation of 10 CFR 50.7 occurred. Available information indicated that the General Foreman had not received sufficient training in employee protection or maintaining a safety conscious work environment at the time of the promotion. Therefore, the NRC staff concluded, that while the actions of the General Foreman caused NMC and D&Z to be in violation of 10 CFR 50.7, the General Foreman's actions were not deliberate in nature and the NRC is not taking a separate enforcement action against the General Foreman for violating the NRC regulation prohibiting deliberate misconduct, 10 CFR 50.5.

The NRC is concerned with the initial approach that D&Z management took in this matter. The initial investigation by D&Z was not aggressive and did not identify that employment discrimination had occurred, attributing the reason for the layoff as a personality dispute and absenteeism. Upon subsequent investigation by NMC, these reasons were found to be unfounded and information developed during the NMC investigation indicated that the lay-off was for discriminatory reasons. It is fortuitous for D&Z that NMC conducted a separate, independent investigation and found that employment discrimination was at the root of the issue. Therefore, civil penalty 2 credit for Identification was warranted to NMC because NMC identified and investigated the matter. Had NMC solely relied on the results of the D&Z investigation, and not conducted its own investigation, credit for the Identification factor would not have been possible. Credit for the Corrective Action factor is warranted because of the combined actions of both NMC and D&Z. Corrective actions by D&Z consisted of, but were not limited to: (1) taking disciplinary action against the General Foreman; (2) conducting surveys to ensure that no residual effects existed in the D&Z safety conscious work environment; (3) reaching a settlement between D&Z and the electrician; and (4) establishing a D&Z Employee Advocate Program. Other actions are described in the previously referenced letter from NMC on May 10, 2004. The NRC acknowledges that the corrective actions by D&Z in this matter addressed both the specific issue and the overall work environment for raising safety concerns and were accomplished without intervention by the NRC.

Therefore, to encourage prompt correction of violations, a safety conscious work environment, and resolution of employment discrimination issues without the intervention of the NRC, I have been authorized, after consulting with the Director, Office of Enforcement, and the Deputy Executive Director for Reactor Programs, to exercise discretion in accordance with Section VII.B.5 of the Enforcement Policy to not issue a Notice of Violation in this matter. Any future violation of 10 CFR 50.7 will be considered for full application of the Enforcement Policy.

The NRC has concluded that information regarding the reason for the violation, the corrective actions taken and planned to correct the violation and prevent recurrence and the date when full compliance was achieved is already adequately addressed on the docket in the letter from NMC dated May 10, 2004. Therefore, you are not required to respond to this letter unless the description therein does not accurately reflect your corrective actions or your position. In that case, or if you choose to provide additional information, please provide your response within 30 days of the date of this letter. Your response should be marked "Response to EA-04-105" and sent to the U.S. Nuclear Regulatory Commission, ATTN: Document Control Desk, Washington, DC 20555 with a copy to the Regional Administrator and Enforcement Officer NRC Region III, and a copy to the Resident Inspector at the Point Beach Nuclear Power Plant. If you contest this enforcement action, you should also provide a copy of your response, with the basis of your denial, to the Director, Office of Enforcement, United States Nuclear Regulatory Commission, Washington, DC 20555-0001.

If you have any questions, please contact Julio Lara, Chief, Electrical Engineering Branch, at (630) 829-9731.

In accordance with 10 CFR 2.390 of the NRC's "Rules of Practice," a copy of this letter will be made available electronically for public inspection in the NRC Public Document Room or from the NRC's document system (ADAMS), which is accessible from the NRC Web site at the Public NRC Library. To the extent possible, your response, if you choose to respond, should not include any personal privacy, proprietary, or safeguards information so that it can be made available to the Public without redaction. The NRC also includes Issued Significant Enforcement Actions on its Web site.

    Sincerely,
    /RA/ Geoffrey E. Grant for
    James L. Caldwell
Regional Administrator

Enclosure: Letter to NMC

cc w/enclosure:
D. Koehl, Site Vice President, NMC
G. Van Middlesworth
Vice President - Nuclear Assessment, NMC
R. Kuester, President and Chief
Executive Officer, We Generation
J. Cowan, Executive Vice President
Chief Nuclear Officer
D. Cooper, Senior Vice President, Group Operations
D. Weaver, Nuclear Asset Manager
Plant Manager
Regulatory Affairs Manager
Training Manager
J. Rogoff, Vice President, Counsel & Secretary
K. Duveneck, Town Chairman
Town of Two Creeks
Chairperson
Public Service Commission of Wisconsin
J. Kitsembel, Electric Division
Public Service Commission of Wisconsin
State Liaison Officer


1. Documents are electronically available from the NRC's document system (ADAMS), which is accessible from the NRC Web site at the Public NRC Library.

2. Civil penalties are not normally considered for contractors of NRC licensees.

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