DES MOINES, Iowa (AP) — Iowa Workforce Development Director Teresa Wahlert sought to favor employers over workers in unemployment benefits decisions, and then fired the chief judge when he opposed her efforts, according to a lawsuit filed Thursday.
Wahlert illegally stripped Joseph Walsh, chief administrative law judge of the unemployment appeals bureau, of job protections and ultimately laid off Walsh and his wife after he told her not to influence the work of judges who are supposed to be independent, Walsh alleges in the lawsuit.
“Wahlert’s decision to include Walsh in the layoff was a thinly disguised means of hiding the motive for terminating him: the fact that Walsh had stood up to efforts to bully and control him and other judges as a means of pursuing an anti-employee agenda, and specifically because Walsh had gone to the U.S. Department of Labor to complain about those efforts,” the lawsuit says.
Wahlert called the lawsuit frivolous and filled with inaccuracies, insisting that Walsh was fired due to a budget shortfall and the poor performance of his bureau.
“It’s unfortunate that once again Mr. Walsh is making baseless accusations that cannot be supported with facts,” she said in a statement. “Now, through this latest attempt, he is wasting the time of Iowa’s court system.”
Democrats last month asked the Labor Department to investigate allegations that Wahlert, an appointee of Republican Gov. Terry Branstad, was improperly pressuring judges to favor employers during disputes over unemployment benefits. Branstad, who called Wahlert “an outstanding department head” Thursday, is also under fire over accusations that Democratic employees have been targeted for politically motivated layoffs.
Wahlert took over Walsh’s job supervising unemployment case judges after firing him last year. Sen. Bill Dotzler, D-Waterloo, alleged in the federal complaint last month that Wahlert demands tallies of how often a judge decides in favor of employers and has called for judges to create tip sheets to help employers win cases.
Wahlert denied allegations of improper meddling, and Branstad said the criticism was based on “inaccurate and faulty information.”
Walsh, a lawyer, had been deputy director of Iowa Workforce Development under Democratic Gov. Chet Culver from 2007 to 2010. After Branstad took office in 2011 and appointed Wahlert as director, Walsh moved into a nonpolitical position leading the bureau with a dozen judges who make thousands of unemployment benefits decisions annually.
Walsh’s lawsuit claims Wahlert’s efforts to pursue an anti-worker agenda “became more overt and focused” over time. As a merit employee, he said that he saw himself as a buffer between Wahlert, a political appointee, and a judicial process that is supposed to be unbiased. Walsh advised Wahlert it was her job to propose legislation and administrative rules, not to influence judges’ decisions, and he became “a forceful buffer and stumbling block to her efforts to exert improper authority,” the lawsuit said.
In April 2013, Walsh and several other employees received notice from the agency that it intended to convert their jobs into political appointments. Walsh challenged the decision, saying it would violate the Social Security Act and U.S. Department of Labor Guidance. Nonetheless, his position was changed a month later.
Walsh filed a complaint with the Department of Labor, which agreed that administrative law judges must be merit employees as long as they hear cases.
In response, Wahlert said that Walsh would stop hearing appeals under a change in duties in which he would only be a manager. He opposed that idea and complained to Branstad’s office, the labor department and the agency’s board in June 2013, the lawsuit said.
The next month, the agency laid off Walsh and his wife, Venus Vendoures Walsh, a program coordinator who had worked for IWD since 1999. An escort walked Walsh out of the building without a chance for him to clean out his desk or say goodbye to colleagues, the lawsuit said, treatment normally reserved for employees accused of serious misconduct.
They were told their jobs were eliminated to address a budget shortfall, but the lawsuit claims that wasn’t true because Walsh’s bureau was $250,000 under budget while his wife’s job was fully funded.
Walsh claims that the retaliation against him continued even after his layoff, with Wahlert unsuccessfully trying to block his return to work under Workers’ Compensation Commissioner Chris Godfrey. Godfrey has filed a separate lawsuit that alleges Branstad improperly slashed his salary and discriminated against him after he refused to resign in 2011.
Dotzler said he interviewed Walsh during his investigation and found him “absolutely credible.”
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Foley reported from Cedar Rapids. AP reporters Tom Beaumont and Kourtney Liepelt contributed.
