Labor & Employment Law Daily Wrap Up, INDIVIDUAL RIGHTS—8th Cir.: Department of Labor’s order against BNSF on behalf of whistleblowing railway carman held to violate Seventh Amendment, (Sep 8, 2026)

By Brandi O. Brown, J.D.

BNSF was entitled to a jury trial on claims for liability, backpay, and compensatory and punitive damages, said the court.

In response to a petition for review of an OSHA order, the Eighth Circuit recently concluded that a Department of Labor order, based on administrative proceedings, violated the BNSF Railway Company’s right to a jury trial under the Seventh Amendment. A railway carman had filed a complaint with the agency based on allegations that he was fired for reporting safety hazards. After a hearing, an ALJ issued a decision and order in his favor, which the Administrative Review Board affirmed. BNSF petitioned the Eighth Circuit for review, and the appeals court vacated the Board’s order, concluding the employer was entitled to a jury trial on the employee’s claims for liability, backpay, compensatory damages, and punitive damages before any equitable claim to reinstatement is adjudicated (BNSF Railway Co. v. Secretary U.S. Department of Labor, Nos. 25-2436, 25-2578 (8th Cir. Sept. 3, 2026)).

A railway carman for BNSF, who was responsible for inspecting railroad cars for safety regulation compliance, was fired following a disciplinary proceeding in early 2020. He filed a whistleblower complaint with OSHA, alleging that the employer had retaliated against him, in violation of 49 U.S.C. § 20109(b)(A), for reporting, in good faith, a hazardous safety condition. After a hearing, an ALJ issued a decision and order in the employee’s favor and ordered reinstatement, backpay, damages, and attorneys’ fees.

Petition for review. After the Administrative Review Board affirmed the ALJ’s order, the employer petitioned the Eighth Circuit for review, arguing that the finding of liability and imposition of damages and other remedies by the agency violated its Seventh Amendment right to a jury trial because it “subjects a private entity to a non-jury trial on a legal or mixed legal-equitable claim by a private individual on a matter involving private rights,” and “places the ALJ in the position of functioning as an Article III court.”

A “legal issue”? First, the appeals court considered whether, prior to adoption of the Seventh Amendment, a claim like that made by the employee would have customarily required a jury trial. It concluded that the claim was analogous to a common-law wrongful discharge claim, which would have been considered a breach of contract. “A breach of contract claim raises a ‘legal issue’ that suggests entitlement to a jury trial,” the court noted.

Additionally, the court explained that the claim “is traditionally legal for another reason: it ‘sounds basically in tort.’” Previously, the Eighth Circuit has described a violation of section 20109 as an “intentional tort” and, like other tort claims, the action “defines a new legal duty, and authorizes the courts to compensate a plaintiff for the injury caused by the defendant’s wrongful breach.”

Money damages. Finally, the court explained that the Act provides for money damages, which, as SEC v. Jarkesy noted, is the “prototypical common law remedy.” Where it is designed to punish or deter a wrongdoer, the court noted, monetary relief is a legal remedy. Where it acts to restore the status quo, it is an equitable remedy.

The Federal Railroad Safety Act provides for “all relief necessary to make the employee whole,” the court noted, including reinstatement, backpay, compensatory damages, and punitive damages not in excess of $250,000. The latter three forms of relief are legal in nature, the court explained, “because the relief ‘seeks to impose personal liability on the defendant, is measured by the plaintiff[’s] loss, and does not involve traceable funds that belong to the plaintiff and are being unlawfully held by the defendant.’” The use of punitive damages as a remedy, the court added, confirms that the Act is also “designed to punish or deter.” Thus, the employee’s action was legal in nature.

Public rights exception. Next, the agency and employee argued that a jury trial was not required under Atlas Roofing Co. v. Occupational Safety and Health Rev. Comm’n, 430 U.S. 442 (1977), which described a “public rights” exception applicable in circumstances where Congress creates new statutory “public rights” to be adjudicated by an administrative agency, with which a jury trial would be incompatible. The Labor Department argued that the Act’s statutory and regulatory regime was unknown to the common law and more closely resembles “a detailed building code” than anything at common law.

However, the court explained, in this instance the employee was not alleging that the railway failed to comply with a regulatory scheme that was unknown to the common law, but instead was asserting that the employer, a private party, breached its duty to another private party (him) by retaliating against him and firing him.

Another instance in which the public rights exception applies is where Congress “creates a ‘seemingly private right that is so closely integrated into a public regulatory scheme as to be a matter appropriate for agency resolution.’” For example, a regulatory program could incidentally require adjudication of a statutory right. However, here, the employee’s claim did not impact a broader regulatory scheme, the court explained. Rather, “it is a ‘standalone’ suit and is ‘neither prioritized nor subordinated to related claims.’” In reaching this conclusion, the court noted that it was “respectfully disagreeing” with a contrary conclusion reached in 1993 by the Second Circuit.

“The Act’s overall regime is also not “incompatible” with a jury trial,” the court concluded, noting that the statute even provides for an employee to bring an original action in federal court should the Labor Secretary not issue a final decision within 210 days of the complaint’s filing. Once there, the court noted, either party is able to request a jury trial. “Given that Congress specifically allowed in the statutory scheme for trial by jury on this very type of dispute in certain circumstances, we see no functional justification for conditioning the employer’s right to a jury trial on the timing of the Secretary’s decision and the choice of an employee to file an action in federal court.”

“The Supreme Court has left open the possibility that agencies may make ‘specialized, narrowly confined factual determinations regarding a particularized area of law,’” the court noted, but the Federal Railroad Safety Act “does not establish the Department of Labor as an ‘adjunct’ to the district court on a claim where the Department’s expertise is important.” In this case, the employee did not argue that the railway violated a specialized regulation under the Act but only needed to show that the employer retaliated against him because of his good faith report. “Article III courts are the “‘experts’ in the federal system” at resolving such claims,” the court concluded.

With the public rights exception inapplicable, the court concluded that the Seventh Amendment entitled BNSF to a jury trial on the employes claims for liability, backpay, compensatory damages, and punitive damages “before any equitable claim to reinstatement is adjudicated.”

The cases are Nos. 25-2436, 25-2578.

Attorneys: Stephen F. Fink (Holland & Knight) for BNSF Railway Co. Rachel Goldberg, Sarah Kay Marcus and Sarah Roberts, U.S. Department of Labor, for Secretary U.S. Department of Labor. Fredric Bremseth, I (Bremseth Law Firm) for Dale Gourneau.

Companies: BNSF Railway Co.

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