Billy Allen SKEETS, Appellee,
v.
Roy L. JOHNSON, Individually and Chief of Weights Division,
Arkаnsas State Highway and Transportation Department; Henry
Gray, Individually and Director of Highways and
Transportation of the Arkansas State Highway Commission;
George Kell, Individually and Ex-Member of the Arkansas
State Highway Commission; David Solomon, Individually and
Ex-Member of the Arkansas State Highway Commission; Patsy
L. Thomasson, Individually and Member of the Arkansas State
Highway Commission; James A. Branyon, Individually and
Ex-Member of the Arkansas State Highway Commission; Festus H.
Martin, Jr., Individually and Ex-Member of the Arkansas
State Highway Commission; Raymond Pritchett, Individually
and a Member of the Arkansas State Highway Commission;
Bobby Hopper, Individually and a Member of the State Highway
Commission; Ron Harrod, Individually and a Member of the
State Highway Commission; and Dalton Farmer, Individually
and a Member of Arkansas State Highway Commission, Appellants.
No. 85-1761.
United States Court of Appeals,
Eighth Circuit.
Submitted March 14, 1986.
Decided Nov. 12, 1986.
Rehearing En Banc Granted Dec. 18, 1986.
Bill S. Clark, Little Rock, Ark., for appellants.
Cliff Jackson, Little Rock, Ark., for appellee.
Before McMILLIAN and BOWMAN, Circuit Judges, and HANSON,* Senior District Judge.
HANSON, Senior District Judge.
Before the court is an appeal from the decision of the district court granting Skeets' summary judgment motion, holding that his termination from employment with the Arkansas State Highway and Transportation Department deprived him of due process in violation of 42 U.S.C. Sec. 1983 and reinstating him with full backpay. We affirm the decision of the district court.1
I. BACKGROUND
Skeets had been an at will employee of the Arkansas State Highway Commission for ten years. On April 10, 1979 he was summarily discharged from his job by appellant Johnson for "dereliction on duty." Although Skeets ceased all official duties on that day, he continued to draw vacation pay until May 18, 1979.
At the time of Skeets' discharge, the Department's employee handbook provided for grievance procedures including an impartial hearing, a thorough investigation, and a final decision in writing from the director. The procedures also provided that the failure of the Department to grant an aggrieved employee the specified rights would advance the grievance to the next step in the process.
Based on stipulated facts, the district court found that Skeets had sufficiently invoked his rights under the procedures when he requested permission from Johnson "to tell his side of the story." The Court also found that Skeets had not been given an impartial hearing or a thorough investigation prior to notification of his termination, nor did Johnson advise Skeets to submit his complaint in writing or offer to assist him in preparing the complaint. The court also found that Johnson's refusal to provide Skeets with an impartial hearing and thorough investigation, as provided in Step 1 of the grievance procedure, automatically advanced the grievance to the next step. As a result, the court concluded that Skeets had a protectable property interest in his continued employment. The court therefore held that, because Skeets sought the equitable remedy of reinstatement with backpay, it was not necessary to inquire into the merits of the underlying dispute, and ordered that Skeets be reinstated with full backpay.
II. DISCUSSION
A. Property Interest
Whether Skeets has a protectable property right in his continued employment is initially a matter of state law. Board of Regents v. Roth,
Under Arkansas law, in the absence of some alteration of the basic employment relationship, an employee for an indefinite term is subject to dismissal at any time without cause. Griffin v. Erickson,
An employee handbook can create a property interest if it reflects a de facto policy of established guidelines to be followed prior to dismissal. See Gerrin v. Hickey,
In this case the Personnel Manual (hereinafter "Manual") was submitted as Exhibit B to the district court with defendants' motion for partial summary judgment, which had asserted Skeets had no property right to continued employment. The district court denied defendants' motion. Skeets now asserts that, although not referred to in the district court's ruling on plaintiff's summary judgment motion, the Manual is part of the record on appeal. We would agree. Because the summary judgment motions of each party deal with the identical issue, whether Skeets had a property interest in continued employment, we can see no prejudice to either party in considering the Manual on appeal. See F.R.App.P. 10(a). The dissent characterizes our consideration of the Manual as raising a new issue on appeal. Although it is certainly true that Skeеts only argued below the grievance procedures created his property right, we believe it would be a strained reading to divorce the grievance procedures from the rest of the Manual of which they are a part. On the contrary, we believe the grievance procedures can only be understood in pari materia with the other provisions in the Manual.
On July 20, 1972, the Director of Highways for the Arkansas Highway Commission provided Highway Department employees with the Manual, and enclosed a letter stating:
This manual has been prepared to provide information for supervisors and other employees. It * * * contains information on all personnel policies, procedures, and employment practices. * * *
To the supervisor, it serves as a guide to the proper administration of personnel. To the employee, it is a source of information on employee services and conduct. By reading and referring to this manual, all employees may fully inform themselves on matters affecting them personally.
Id. (emphasis added). Section 106(C) of the Manual goes on to state, with regard to employee conduct, that "[i]t has long been the practice of the Highway Department to counsel with and help any emрloyee whose performance is not satisfactory." Manual at 4. Section 106(C) also lists the grounds for immediate termination of employees whose work is "unsatisfactory." One of the grounds listed is for "[d]ereliction of duty." Id.
The Manual in Sec. 205(10) explains that in filling out Form AH125, the personnel action form, "[a]ll AH125's must have in the 'Remarks' section, a thorough, yet concise, explanation as to the justification for the proposed action." Manual at 33. Section 206(4) explains that in completing Form AH125 for terminating an employee "the reason for separation and the quality of the employee's service, whether satisfactory or unsatisfactory, should be entered in 'Remarks.' " Manual at 38. Upon Skeets' termination, the AH125 "Remarks" portion states as the reason for discharge merely "[d]ereliction of duty."
We believe that it is apparent, by virtue of the statute providing for a merit review mechanism and by the Manual stating reasons for termination and the specific manner in which employees can be terminated, that Skeets was more than an at will employee when he was summarily fired.
Against this background, we must consider Skeets' contention that the grievance procedures provide him with a property right to continued employment. The procedures appear at Sec. 133 of the Manual, as amended by Minute Order on June 25, 1975, and provide a method for employees to grieve working conditions. Step 1 states: "It is the duty of the supervisor to give an impartial hearing [and] make a thorough investigation * * *." The procedures also provide for an impartial hearing and thorough investigation when the employee "take[s] this matter up first with his/her supervisor." The procedures do not specify whether the request for the hearing should be in writing or whether it can be made orally. As a result, it appears to have been reasonable for the district court to conclude that Skeets' oral request had sufficiently invoked the grievance procedures so as to trigger his right to continued employment until he received his pretermination investigation and hearing.2
The grievance procedures further provide that "[i]f the Department fails to meet and/or provide for any grievance hearing within the time limits, the grievance will automatically be advanced to the next step." In addition, the procedures state that the final decision will be made by the Director and that after a subordinate provides him with a written report concerning the grievance, the Director's "final decision will be sent in writing to the employee."
We recently held in Hogue v. Clinton,
The central difference between Skeets and Hogue is in the quantum of due process each employee was afforded. In Hogue, the record reveals that at the time he was terminated he was presented with a list of allegations, at which point he pursued an appeal. During the appeal process he was accorded "some kind of a hearing" at which the allegations against him were discussed. Roth,
By contrast, Skeets was called into his supervisor's office and terminated, the only reason stated being "dereliction of duty." Skeets requested a hearing in order to tell his side of the story. The district court found that this request was denied and that he was at no point presented with a list of the charges against him, nor was he able to confront those who provided evidence against him. In addition, the investigation which formed the basis of his dismissal was not completed and submitted to the Director until two months after Skeets had been terminated. He did not obtain a copy of this report until in discovery in preparation for trial. These irregularities come in the face of grievance procedures which provide in Step 1 for a thorough investigation and impartial hearing, and that the grievance will automatically advance to the next step if the grievance procedure is not provided by the Department.
The factual postures of these cases demonstrate the differences between them. In Hogue, the claimant asserted a property right to a due process pretermination hearing in spite of the fact that he had been presented with a list of the charges against him and had been able to appeal the termination as provided in the grievance procedures. It would therefore appear that what Hogue claimed was a due process right to the "specific decision" that he be reinstated with backpay. This conclusion follows from the Hogue reference to Goodisman v. Lytle,
Skeets, on the other hand, appears to be asking for an opportunity to have any kind of a hearing, rather than a hearing at which a specific decision would result. On this basis, we would hold that the grievance procedures in this case presented Skeets with a property interest in a thorough investigation and hearing. That is, the grievance procedures, by virtue of the fact that a grievance advances to the next step if the Department fails to provide the required process, amount to a restriction on agency discretion which the Hogue court found to be necessary to trigger a sufficient property interest.
We are well aware that our holding seems to narrow some of the language in Hogue, but we cannot believe that Hogue is a signal for us to countenance the complete deprivation of even the rudiments of due process as occurred in this case. The grievance procedures in this case create a reasonable expectation that a grievance will be handled fairly. They by no means suggest that a particular decision will result, but they do create a mutually explicit understanding that had Skeets been allowed to proceed with his grievance he would have received the quantum of process that he was due.
The district court relied on Wilson v. Robinson,
We have made clear in Roth that "property" interests subject to procedural due process protection are not limited by a few rigid, technical forms. Rather, "property" denotes a broad range of interests that are secured by "existing rules or understandings." A person's interest in a benefit is a "property" interest for due process purposes if there are such rules or mutually explicit understandings that support his claim of entitlement to the benefit and that he may invoke at a hearing.
We conclude that it would have been reasonable for Skeets to believe that he would only be terminated for one of the grounds listed in the Manual and only after he had been given a thorough, concise explanation, in effect what appears to be termination only for cause. Taken with the grievance procedures providing a mechanism to appeal employee matters, we conclude Skeets had a right to a hearing and investigation before he was terminated.3 Today's holding is consistent with those of other courts which have considered whether grievance procedures can create an expectation of continued employment. See Beckham v. Harris,
Nor do we find convincing the dissent's assertion that we foist process into substance. Even if we were as certain as the dissent in demarcating where process ends and substance begins, we believe the procedures at issue would create the kind of mandatory limitation on the employer's discretion which makes any such distinction not especially meaningful. See Rogers v. Masem,
It is apparent from this record that Skeets was not accorded adequate process. In Cleveland Board of Education v. Loudermill,
Appellants assert that Skeets waived his due process rights under the grievance procedures when he failed to submit a grievance in writing to the Department.4 From the stipulated record it is apparent that Skeets attempted orally to invoke the grievance procedures. We would agree with the district court that once his oral request to rebut the charges against him had been denied, it was unnecessary for the plaintiff to go further. We therefore conclude that he did not abandon his rights under the grievance procedures.
B. Equitable Relief
Even though the district court found that Skeets had been deprived of his property interest in his employment without procedural due process, the appellants argue that he must demonstrate that the substantive allegations against him were untrue before he could be entitled to any relief. They argue that the district court misapplied Carey v. Piphus,
The district court chose to follow the narrow interpretation of Carey set out by another Arkansas district court in Shaw v. Gwatney,
The Court in Carey held that an employee alleging that a discharge resulted in a deprivation of liberty could only recover nominal damages unless it could be shown that a pretermination hearing would have changed the result or that the plaintiff could dеmonstrate actual damages such as emotional distress.
In reaching its conclusion, the Court acknowledged that the proper measure of damages for a constitutional injury must be evaluated against the nature of the constitutional right in question. Id. at 264-65,
When, as in this case, the employee has established he has a property right to continued employment, the proper measure of damages is the value of the lost employment--in this case reinstatement and backpay. This is because the "cause" hearing focuses not on the stigma attached to the deprivation, but upon whether the employee can be terminated for cause.
The Court in Carey suggests at footnotе 15 its disfavor with cases from the Fourth and Fifth Circuits in which the courts awarded backpay for public employees discharged with cause, but without procedural due process. Carey,
affording the employee an opportunity to respond prior to termination would impose neither a significant administrative burden nor intolerable delays. Furthermore, the employer shares the employee's interest in avoiding disruption and erroneous decisions; and until the matter is settled, the employer would continue to receive the benefit of the employee's labors. It is preferable to keep a qualified employee on than to train a new one. A governmental employer also has an interest in keeping citizens usefully employed rather than taking the possibly erroneous and counter-productive step of forcing its employees onto the welfare rolls. Finally, in those situations where the employer perceives a significant hazard in keeping the employee on the job, it can avoid the problem by suspending with pay.
Id.
We therefore hold that because Skeets had a property right to continued employment until his "cause" hearing, the district court was correct in awarding him reinstatement and backpay until a proper hearing is held.
III. OFFICIAL AND INDIVIDUAL CAPACITY
Appellants assert that the district court's award of backpay is barred by the Eleventh Amendment. The district court's order awarding reinstatement with backpay does not state whether it is against the appellants in their official capacities or in their individual capacities. In its earlier April 21, 1983 order, the district court dismissed the State of Arkansas and the Arkansas State Highway Commission as immune under the Eleventh Amendment. Apparently remaining after the court's order were the appellants, sued in their individual and official capacities. We would conclude, because the court below did not sрecify in what capacities its backpay and reinstatement award would run against the defendants, it would be inappropriate for this Court to make any determination. Rather, it is for Skeets to attempt to enforce his award against the defendants. We therefore do not reach the issue of whether the court's award is violative of the Eleventh Amendment.
IV. CONCLUSION
For all of the reasons stated above, we affirm the decision of the district court.
BOWMAN, Circuit Judge, dissenting.
The Court concludes that Skeets, an at-will state employee, possesses a constitutionally protected "property" right to continued employment because of the grievance procedures set forth in the Arkansas State Highway Department's personnel manual. After then finding that Skeets was not afforded procedural due process when he was discharged, the Court concludes that the District Court may order reinstatement with backpay without first determining whether Skeets would have been dismissed even if he had been afforded adequate procedural due process. Finally, the Court decides not to reach the Eleventh Amendment issue raised by the backpay award against the defendant state officials. For the reasons discussed below, I respectfully dissent from each of these conclusions.
I.
The Court concludes in Part II.A. of its opinion that Skeets possesses a constitutionally protected "property" right to continued employment by virtue of a grievance procedure set forth in the personnel manual of the Arkansas State Highway Department. It is important first to understand what is and what is not involved in this case. The parties submitted to the District Court a comprehensive list of stipulated facts. As stated in the District Court's opinion, the parties stipulated, among other things, that "[p]laintiff's job was not tenured, and under Arkansas law he was an at-will employee whose employment could be terminated at any time. Plaintiff's only claimed source of a property interest is the department's grievance procedures." Skeets v. Johnson,
In addition, though section 106 does list some reasons for termination, nowhere in the manual does it state that those are the only reasons for termination. In any event, because the existence of specific, exclusive reasons for termination--a proposition that again would contradict the parties' stipulated fact--would present a totally different situation, I believe that any reference to or reliance on section 106 is irrelevant and improper. Moreover, the Court's theory and analysis, based on section 106, was neither presented to nor relied on by the District Court, and thus it cannot properly be asserted on this appeal. See Singleton v. Wulff,
In reaching its decision, the Court relies on Wilson v. Robinson,
Since 1972, the Supreme Court has utilized a two-step procedural due process analysis. The threshold inquiry focuses on whether the challenged governmental action deprives the plaintiff оf "life, liberty, or property." In Board of Regents v. Roth,
[t]o have a property interest in a benefit, a person clearly must have more than an abstract need or desire for it. He must have more than a unilateral expectation of it. He must, instead, have a legitimate claim of entitlement to it....
Property interests, of course, are not created by the Constitution. Rather they are created and their dimensions are defined by existing rules or understandings that stem from an independent source such as state law--rules or understandings that secure certain benefits and that support claims of entitlement to those benefits.
Id. at 577,
In the context of public employment discharges, the Supreme Court has made it clear that the underlying substantive property right involved is a right to continued employment. See, e.g., Cleveland Board of Education v. Loudermill,
Notwithstanding Skeets's at-will status, the Court holds that "the grievance procedures ... presented Skeets with a property interest in a thorough investigation and hearing" before he could be terminated. Ante at 772. The Supreme Court, however, never has held or even suggested that an expectation of review alone is sufficient to create a property right for procedural due process purposes. Moreover, our Court rejected that very contention in Hogue,
The Court's language in Olim v. Wakinekona,
Process is not an end in itself. Its constitutional purpose is to protect a substantive interest to which the individual has a legitimate claim of entitlement. If officials may transfer a prisoner "for whаtever reason or for no reason at all," there is no such interest for process to protect. The State may choose to require procedures for reasons other than protection against deprivation of substantive rights, of course, but in making that choice the State does not create an independent substantive right.
Id. at 250-51,
In Hewitt v. Helms,
The creation of procedural guidelines to channel the decisionmaking of prison officials is ... a salutary development. It would be ironic to hold that when a State embarks on such desirable experimentation it thereby opens the door to scrutiny by the federal courts, while States that choose not to adopt such procedural provisions entirely avoid the strictures of the Due Process Clause. The adoption of such procedural guidelines, without more, suggests that it is these restrictions alone, and not those federal courts might also impose under the Fourteеnth Amendment, that the State chose to require.
Id. at 471,
As these and other cases demonstrate, the mere fact that the State has created "simple procedural guidelines," id., to channel its decision making is not sufficient to create a substantive interest entitled to federal constitutional protection under the Due Process Clause. See Olim,
Instead, it is only when the procedural requirements are intended to impose (and, in fact, contain) significant, substantive restrictions on the discretion of state officials in the decision-making process that the State creates and an individual acquires a constitutionally protected interest. See Loudermill,
The grievance procedures in the present case contain no such restrictions. Indeed, the Court mentions no provisions in the grievance procedures that in any way place "significant substantive restrictions" on defendants' discretion in deciding to discharge Skeets or that even arguably "establish any grounds upon which termination must be based." Hogue,
The grievance procedure does contain a paragraph providing that "[w]hen an employee thinks or feels that any condition affecting his ... employment is unjust, inequitable, a hindrance to the satisfactory operation or creates a problem, the employee shall use the following procedures for the solution of such problems." A similar provision in the grievance procedure at issue in Hogue was deemed insufficient to create a property interest. The Court there stated:
Here, the Grievance Policies and Procedures merely provide an avenue of appeal for an employee discharged from the [state agency]; they do not restrict or even guide that agency's decision making by allowing for termination only under certain circumstances or for specific reasons. The dissenting opinion reads into the phrase ... stating that an employee "who feels he/she has beеn terminated unfairly will have the right to appeal, under the following formal procedures" a requirement that an employee can be terminated only for good cause. We disagree that this provision ... "may be properly construed to impose substantive restraints on the decision to terminate." The provision creates only an expectancy of review, not of continued employment; the procedures outlined place no significant substantive restrictions on the decision-making. Under Arkansas law, because he was not employed for a definite term, Hogue was an employee at will, subject to dismissal at any time without cause. We do not see, then, how Hogue could have harbored anything more than a unilateral expectation of continued employment, insufficient to entitle him to due process protection.
The opinion of the Court in the present case ignores this language and attempts unconvincingly to distinguish Hogue.1 The Court states that "[t]he central difference between Skeets and Hogue is in the quantum of due process each employee was afforded." Ante at 771. The Court then states that because Hogue had received "some kind of a hearing," he "had no property right to a due process pretermination hearing." Id. That, however, was not the basis for the holding in Hogue. The rationale of Hogue is straightforward: Because Hogue had no underlying substantive property right to continued employment due to his at-will status, and because the grievance procedures imposed no "significant substantive restrictions" or guidelines on the state officials' discretion in the decision-making process (e.g., "by allowing for termination only under certain circumstances or for specific reasons"), Hogue had no constitutionally protected interest entitled to procedural due process protection. The fact that Hogue had received "some kind of a hearing" simply was irrelevant to whether he had an underlying substantive right. As a matter of federal constitutional law, the result in Hogue would have been the same whether or not Hogue received a hearing or any other process. See, e.g., Henderson v. Sotelo,
Whether an individual has a substantive right to continued employment entitled to due process protection never has turned on whether or not the individual received the process that was promised him by the State. To the extent that Wilson v. Robinson,
The argument that the procedures established by the regulatiоns can themselves be considered a liberty interest is analytically indefensible. We have repeatedly observed: "Procedural protections or the lack thereof do not determine whether a property right exists...." A liberty interest is of course a substantive interest of an individual; it cannot be the right to demand needless formality.... Of course the existence of state procedural protections is not irrelevant to a determination of whether a substantive interest exists. A state often provides for specific procedures to ensure the realization of a parent substantive right. The existence of such protections may suggest the presence of a substantive limitation on official action, and it is "not inconceivable that substantive protections could be inferred from the existence of procedural safeguards ..."; but a state created procedural right is not itself a liberty interest within the meaning of the Fourteenth Amendment.
Constitutionalizing every state procedural right would stand any due process analysis on its head. Instead of identifying the substantive interest at stake and then ascertaining what process is due to the individual before he can be deprived of that interest, the process is viewed as a substantive end in itself. The purpose of a procedural safeguard, however, is the protection of a substantive interest to which the individual has a legitimate claim of entitlement. A basic problem ... with maintaining that one has an entitlement to a state created procedural device such as a hearing is that the dimensions of the procedural protections which attach to state law entitlements are defined by federal standards. When the federal standard is applied, the "process that is due in a given instance may bear little or no resemblance to the original expectation...." Indeed, the logical flaw in the proposition is even more fundamental. If a right to a hearing is a liberty interest, and if due process accords the right to a hearing, then one has interpreted the Fourteenth Amendment to mean that the state may not deprive a person of a hearing without providing him with a hearing. Reductio ad absurdum.
Shango v. Jurich,
For the reasons stated above, I dissent from the Court's hоlding that Skeets possesses a substantive property right to continued employment by virtue of the grievance procedures in the Department personnel manual.2
II.
Assuming arguendo that Skeets had a protected property interest and was denied procedural due process, I do not agree with the Court's holding that a federal court may award equitable relief in the form of reinstatement with backpay without first determining whether Skeets would have been discharged if he had been afforded adequate procedural due process.
In Carey v. Piphus,
The Court in the present case follows the analysis suggested by Chief Judge Lay in his dissent in Hogue,
Though the Supreme Court's language in Loudermill,
The Court's holding in the present case also is out of step with Bishop v. Tice,
The Supreme Court seems to have rejected the view that a public employee dismissed without benefit of procedural due process is necessarily prejudiced and therefore entitled to damages in the nature of back pay. [citing Carey,
Id. at 357-58 n. 17. The Court's holding likewise conflicts with Judge McMillian's dissenting opinion in Pollock v. Baxter Manor Nursing Home,
Carey requires a discharged public employee who is seeking reinstatement or backpay to prove that she would not have been discharged if she had been given a due process hearing. Ordinarily, this would require proving that the stigmatizing information is false.... The deprivation, and the nature of the damages that flow from that deprivation, must be considered as separate and distinct elements of a procedural due process cause of action. See Bishop v. Tice,
The decision in the present case also conflicts with the great weight of authority in other circuits holding that under Carey an award of backpay is inappropriate if the discharge was justified. See, e.g., City of Ann Arbor v. United States Department of Labor,
For the reasons stated above, I dissent from the Court's affirmance of the award to Skeets of reinstatement with backpay. In my view, the case should be remanded for an evidentiary hearing. In accordance with Carey, Skeets would be entitled to reinstatement with backpay only if he could prove that he would not have been discharged had due process been observed.
III.
In Part III of its opinion the Court notes that the District Court's backpay award against the defendant state officials is ambiguous as to whether it is against defendants in their official capacity or in their individual capacity. The Court concludes that it would be inappropriate to make any determination and therefore does not reach the Eleventh Amendment issue raised by the backpay award. I believe that such an award, whether it is against the defendant state officials in their official capacity or in their individual capacity, violates the Eleventh Amendment. Thus, in my view, the Court's decision not to reach the merits of this properly raised issue is an abdication of our judicial function and only postpones the inevitablе to another panel on another appeal.
Clearly an award of backpay against defendants in their official capacity would be barred by the Eleventh Amendment. See Edelman v. Jordan,
Likewise, Skeets cannot obtain backpay against defendants in their individual capacity, since only the State is responsible for backpay. See Burt v. Board of Trustees,
In Burt v. Board of Trustees, the plaintiff school teacher alleged that she was discharged without procedural due process, and sought compensatory damages and reinstatement with backpay. Before trial, the plaintiff dismissed her claim for damages. The district court construed the remainder of her claim as equitable. The court found a procedural due process violation, and awarded backpay against the defendants. On appeal the Fourth Circuit noted that the district court's order and judgment were "ambiguous as to whether the named defendants were sued in their official or individual capacities."
Since the named defendants possessed the power to reinstate and cause disbursement of back pay from public funds only in their official capacities ... any judgment, to be consistent with the initial characterization of the action as "equitable," must necessarily run against defendants as officials. Private citizens are not empowered to reinstate or order back pay out of school board or county funds.
Id.
In Dwyer v. Regan, the plaintiff, a state employee, alleged that the defendant's actions effectively deprived him of a property right to continued employment without procedural due process. Unlike Skeets, however, the plaintiff there sought both equitable relief (reinstatement with backpay) and damages against the defendant in both his official and individual capacities. The district court had dismissed the plaintiff's complaint for failure to state a claim upon which relief could be granted. On appeal the defendant contended that the plaintiff's claim, though nominally against the individual defendant, was in reality an action against the State and therefore was barred by the Eleventh Amendment. The Second Circuit agreed that the claim for backpay was barred by the Eleventh Amendment, but that his claims for damages and reinstatement were not barred.
After first holding that the claim for reinstatement was not barred by the Eleventh Amеndment (since it was the sort of purely prospective injunctive relief permitted under Edelman ), the Second Circuit stated:
In contrast, [plaintiff's] claim for backpay seeks "the payment of ... money which [he contends] should have been paid, but was not." If these sums should have been paid, they should have been paid by the State, not by [the defendant] in his individual capacity, and an award of backpay would necessarily have to be satisfied from State funds. Thus, [the plaintiff's] backpay claim is a claim for "a retroactive award which requires the payment of funds from the state treasury," and is barred by the Eleventh Amendment, absent a waiver of immunity by the State....
[The plaintiff's] request for compensatory ... damages stands on different footing from his request for backpay. The complaint asserts claims against [the defendant] in both his official and his individual capacities, and while we are aware of no theory that could render [the defendant] individually liable for [the plaintiff's] backpay, such is not the case with respect to the claim for damages. While [the defendant] had no duty in his individual capacity to pay [the plaintiff's] salary, he did have a duty not to deny [the plaintiff] his federally protected right to due process. Thus, if [the plaintiff] can establish that he [was denied procedural due process], there is no Eleventh Amendment impediment to his recovering damages for that denial from [the defendant].
Id. at 836-37 (citing Edelman,
I agree with the reasoning of these courts. Backpay, by definition, represents an amount due an individual from his employer for the salary he should have received but did not because of an unlawful discharge. An award of backpay in this case would represent the amount owed Skeets by the State of Arkansas as though Skeets had remained on the State payroll since April 10, 1979. "The funds to satisfy the award in this case must inevitably come from the general revenues of the State of [Arkansas], and thus the award resembles far more closely the monetary award against the State itself than it does the prospective relief awarded in Ex parte Young [
Had Skeets sought compensatory damages from the defendants in their individual capacity, his recovery could have included his lost wages (or backpay), assuming he could have satisfied the Carey rule of causation. It seems apparent to me that Skeets dropped his claim for damages for the very reason that Carey would have required him to prove that he would not have been discharged if he had received due process. But Skeets did not seek damages; he sought backpay, and thus his case founders on the rock of Eleventh Amendment immunity.
I would reverse the judgment of the District Court.
Notes
The Honorable WILLIAM C. HANSON, Senior United States District Judge for the Northern and Southern Districts of Iowa, sitting by designation
The Honorable HENRY WOODS, United States District Judge for the Eastern District of Arkansas
Appellants assert that for Skeets to have an expectation to continued employment there must have been some substantive limitation on or condition precedent to the employer's right to discharge the employee. As authority for this proposition, appellants cite our recent decision in Payne v. Ballard,
The dissent's statement that Skeets has failed to state a claim of an alleged liberty interest is patently obiter dictum. See infra at 781 n. 2
Appellants rely on Birdwell v. Hazelwood School District,
The Court also tries to reconcile this case with Hogue by finding that there in fact was some significant substantive restriction on defendants' discretion. The Court states, "That is, the grievance procedures, by virtue of the fact that a grievance advances to the next step if the Department fails to provide the required process, amount to a restriction on agency discretion which the Hogue court found to be necessary to trigger a sufficient property interest." Ante at 772. This, however, is a non sequitur. The fact that Skeet's grievance automatically may advance to the next step in the grievance process in no way restricts defendants' discretion. Under Arkansas law, defendants may discharge Skeets at any time (and at any step in the grievance process) for any reason and without cause. I see in that no significant substantive restriction on agency discretion. I believe it is abundantly clear that the grievance procedures here are entirely procedural and create no substantive right to continued employment
Because the District Court found that Skeets had a property interest, it did not address his "liberty" interest claim. Skeets,