Investigation by Kyle Abraham, Oregon State Lottery (July-August 2016)
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1 Investigation by Kyle Abraham, Oregon State Lottery (July-August 2016) This memorandum documents a factual summary resulting from the investigation by Kyle Abraham of Barran Liebman LLP into allegations against Roland Iparraguirre ("Iparraguirre"). FACTUAL SUMMARY On Monday, April 25, 2016, former Oregon Lottery Director Jack Roberts placed Iparraguirre on paid administrative leave, which was based on Iparraguirre s interactions with Janell Simmons on April 18, On April 26, 2016, Roberts was removed as the Director, and, on April 27, 2016, Pack was appointed to serve as the Acting Director. Beginning on April 28, 2016, Pack received complaints and concerns from current and former Lottery employees about Iparraguirre s management style and conduct. The allegations included the following: Iparraguirre questioned at least one employee about OFLA/FMLA use in a manner that may have dissuaded or intimidated the employee(s) from taking OFLA/FMLA leave; Iparraguirre did not follow a fair and arms-length process in hiring E4, when there may have been more qualified workers for the position who were older than E4 or female; Iparraguirre held at least one female manager to a higher standard than the standard to which he held male employees; Iparraguirre s management style is perceived as autocratic and intimidating. Pack also asked Mr. Abraham to investigate the reason Roberts placed Iparraguirre on paid administrative leave, which was Iparraguirre s interactions with Simmons on Monday, April 18, Iparraguirre has been employed by the Oregon Lottery since December 2, Iparraguirre was recruited by former Governor Kitzhaber s staff, specifically Liani Reeves. Ms. Reeves arranged for a meeting between Roberts and Iparraguirre. Roberts agreed to appoint Iparraguirre to serve as the Deputy Director for the Lottery, and Iparraguirre was approved by the Lottery Commissioners. As the Deputy Director, Iparraguirre s first-level supervisor was Roberts. Iparraguirre s job duties include assisting the Director on the day-to-day operations of the Lottery. Iparraguirre described his position as the "vice principal" of the Oregon Lottery.
2 Page 2 As to the first allegation, regarding use of OFLA/FMLA, the following information was collected: On May 2, 2016, E1 complained to the Oregon Lottery Human Resource Department ("HR") about Iparraguirre. E1 has never been supervised by Iparraguirre; however, she worked with Iparraguirre on the Video Lottery Terminal Modernization Program ("VLTMP"). Iparraguirre had authority to direct and assign work related to the VLTMP to employees working on the VLTMP, including E1. E1 reported that she felt pressured by Iparraguirre to always be available for Lottery business, even at times when she was out on medical or family leave. She stated that she felt obligated to check in on Lottery matters even when she was in the hospital. E1 stated this was especially true in connection to VLTMP meetings. According to E1, she had two conversations with Iparraguirre about her attendance. The first meeting was around October 2015, and Iparraguirre stated he observed a significant and unacceptable number of absences from work. According to E1, she tried to explain that some of the absences were actually days that she teleworked or that she attended a week-long conference, but Iparraguirre stated that she needed to do a better job at being in the office. E1 reported Iparraguirre talked with her a second time about her attendance this time in December E1 stated that her youngest daughter was sick, and E1 ended up getting it, too, earlier in December Altogether, E1 was out of the office for a long stretch of time; however, E1 stated she called into meetings related to the VLTMP. During this meeting, Iparraguirre suggested she should consider splitting her OFLA time with her husband, who was also a State employee. Iparraguirre went on to use his personal experience as an example, stating that he and his wife would split duties when their children were sick, and suggesting that she consider using OFLA leave in that manner. At the end of the meeting, E1 said she asked Iparraguirre if there was a performance issue. Iparraguirre stated there was no performance issue. In reflecting on the conversation, E1 felt that Iparraguirre was asking her to consider not using OFLA at times when she was entitled to use OFLA. E1 stated that Iparraguirre told her that calling in to a meeting was not an acceptable substitute for in-person attendance. However, other employees called in to meetings with no objection from Iparraguirre. E3 reported that she talked with E1 and others about concerns/complaints related to Iparraguirre. E3 shared these concerns with Gina Hawks, Lottery HR. All of E3 s information about this topic comes from her conversation with E1, which took place in E1 s office. E1 stated she felt harassed by Iparraguirre because Iparraguirre told E1 he did not like the "private appointments" on E1 s Outlook calendar for her medical appointments or otherwise. Also, Iparraguirre started "micro-managing" E1 s calendar, even though E1 was not within Iparraguirre s chain of supervision. Iparraguirre questioned E1 s use of OFLA/FMLA time, and asked E1 if it was possible for E1 and her husband to have a more balanced amount of time off. According to E3, E1 is "not a gossip," and she is not one to exaggerate details.
3 Page 3 E2 was E1 s first-level supervisor. E2 also reported that Iparraguirre asked questions about the manner in which E1 was using OFLA/FMLA. During her investigative interview, E2 reported a time when E1 was going to call in from home for a VLTMP meeting because she was home with a sick child. Iparraguirre suggested to/told E2 that "we tell her to have her husband stay home instead of her." E2 told Iparraguirre that she would refuse to tell E1 how to parent. According to Iparraguirre, E2 was responsible for managing all leave (OFLA/FMLA, telework, etc.) requests for employees in her department, including E1, and he was not responsible for managing E1 s attendance. Iparraguirre reported that several Lottery managers, including E5, E18, and E19, all informed Iparraguirre that E1 was missing a lot of work and she was missing meetings. Iparraguirre passed the information to Roberts, and Roberts told Iparraguirre to look into the matter. Iparraguirre reviewed E1 s calendar and found that E1 s Outlook calendar, which was visible by all Lottery employees, had days blocked out showing she would not be in the office. According to Iparraguirre, based on this information, Iparraguirre talked with E1 one time about her attendance, and he thought it was in November Iparraguirre asked E1 about her attendance, but Iparraguirre reported she did not provide a detailed reason supporting her absences. Iparraguirre stated he reminded her that either E1 or a backup needed to attend meetings. Iparraguirre also told E1 words to the effect that "it looks like you have been missing critical meetings." Iparraguirre denied that he ever discussed taking OFLA/FMLA time with E1; however, later in the interview, Iparraguirre stated "any of the discussions I had with [E1]... I was always very supportive of any leave she had to take, especially for FMLA/OFLA." Additionally, eventually, Iparraguirre reported a conversation with Roberts, where Roberts stated, "E1 has a lot of important projects, but her husband... does not have a lot of work, and when there is an appointment, why can t [he] go instead of E1?" or words to that effect. As to the second allegation, regarding the hiring of E4, the following information was collected: E4 began working at the Oregon Lottery in April 2014 as the Contracts Officer. Initially, E4 applied for the position of Retail Contracts Manager around December 2013; however, E11 was selected and hired by Jack Roberts, former Director of the Oregon Lottery, for the position. Roberts was on the interview panel for the position, and he was impressed with E4 and continued to keep in contact with E4. Roberts eventually hired E4 as a Contracts Officer. E4 reported that he commuted to the Lottery with Iparraguirre at least once a week, and at times they would stop for a drink on the way home from work. They were not friends, but had a closer relationship than mere work colleagues. According to Iparraguirre, he and Roberts discussed getting more expertise in the Contracts and Procurement Department for a few months before E4 was hired. Roberts stated he was going to create a new opening in the department, and he wanted to do a direct appointment to fill the position with E4. Iparraguirre does not know if Roberts talked with E13, the direct supervisor for the position, or E6, about hiring E4. E6 was the first-level supervisor for the new position and E13 was the second-level supervisor.
4 Page 4 Iparraguirre stated the decision to hire E4 was Roberts s decision, and Roberts introduced E4 as his choice. On April 28, 2016, former Lottery employee, E7, expressed concerns to E15 about Iparraguirre s role in hiring E4. After being informed of E4 s employment, E7 asked E13 what the Lottery was paying E4. E7 stated that E13 did not know, and she would have to ask Iparraguirre. Later, E13 told E7 that E4 s salary was equal to E7 s salary. E7 stated that E13 told her Iparraguirre was "really pissed" that E7 asked about E4 s salary. E7 shared the details of her meeting with E13 with E6. Based on the response from E13, E7 felt she could not talk with Iparraguirre about E4 s salary, and E7 did not have any personal interactions with Iparraguirre about E4 s salary directly. E13 reported that she met with Iparraguirre, and she told Iparraguirre E7 asked about E4 s salary level in comparison to her salary. E13 stated that Iparraguirre got angry. Iparraguirre told E13 that E4 was to be paid the same as E7, and to let E7 know she would not get more money. E13 concluded that Iparraguirre was "really pissed" based on her observation of his demeanor. E13 told E7 that Iparraguirre was "really pissed." On April 29, 2016, former Lottery employee, E6, expressed concern with the hiring of E4. During early April 2014, E6 was informed by her first-level supervisor, E13, that a new Contract Officer, E4, was hired to work for E6. E6 was surprised at this announcement because she was not consulted prior to the hire and because there were no open positions in her department. E13 informed E6 that Iparraguirre and Roberts hired E4. When talking about the nature of his relationship with E4, Iparraguirre stated E4 was not a friend at the time E4 was hired. Iparraguirre failed to disclose that he routinely commuted to work at the Lottery, Portland to Salem, with E4. Iparraguirre failed to report that he played ping pong, at the Lottery facilities, with E4. Iparraguirre stated he did go to lunch with E4, but not at any rate more than with other employees. As to the third allegation, regarding Iparraguirre holding female manager(s) to a higher standard than male managers, the following information was collected: On May 5, 2016, E2 complained to Pack that Iparraguirre treated her differently than her male counterparts. E2 also complained that she was bullied by Iparraguirre in "an insidious and consistent" manner. E2 explained the relevant time period was during her time as an executive manager, which was prior to March 1, In that capacity, she and employees in her departments were directly involved in the VLTMP. E2 identified her male counterparts to be the male managers on the Executive Leadership Team (ELT) and the male Lottery employees working on the VLTMP, which specifically included E5. E2 s claims in connection to being treated differently relate to the management of her employees attendance at work, especially those employees working on the VLTMP. E2 stated her employees were required to attend meetings in person, while male managers did not have the same requirement applied to their employees. Specifically, the employees in the project management office or IT departments were permitted to call into meetings. According to E2, during every VLTMP meeting, there was someone who
5 Page 5 would call into the meeting, maybe a Lottery employee or vendor. According to E2, she was required to prepare a schedule listing her employee coverage plan, whereas E5 and other male managers were not required to do so. According to Iparraguirre, he allowed managers to handle employees within their own departments; however, Iparraguirre stated there were times when no one from E2 s team would be present for a meeting. In response, Iparraguirre and Roberts asked E2 to prepare a schedule to establish coverage for meetings. Iparraguirre directed employees to attend meetings in person only if they were physically in the building; however, if an employee was on approved time away, they would not be required to attend in person. E2 also claimed that Iparraguirre scrutinized the approved time away from work that E2 granted for employees in her department; however, departments managed by male employees did not receive the same scrutiny from Iparraguirre. E2 reported an incident in January 2016 where Iparraguirre scrutinized her decision to grant vacation time, and this incident was confirmed by E1. E2 granted E1 vacation to watch her child participate in an out-of-state competition. During E1 s vacation, a VLTMP meeting took place and she called in to the meeting. Iparraguirre criticized E2 for approving the time off. However, another Lottery employee who was supposed to attend the VLTMP meeting also had a child participating in the same event, and that employee was not required to call in. The other employee reported to Iparraguirre. On a related issue, E1 also shared a general observation of female staff since Iparraguirre started at the Lottery, beginning on December 2, Since that time, several female staff (including some fairly high ranking employees) have been demoted from higher ranking positions, removed from VLTMP duties, left due to the way Iparraguirre treated them, or were fired. According to E1, the list of female staff included E8, E9, E10, E7, E6 and E2. In response to the observation about a number of female staff leaving, Iparraguirre explained he was not involved in the decision to remove E8. E9 sent Iparraguirre an , wherein she communicated her excitement about a new job opportunity. E10 worked for E5 and E5 made the recommendation regarding her employment. E7 reported to E13, and he was not involved with her employment. Iparraguirre did not recall ever meeting E6. Also, Iparraguirre stated that he thinks the Lottery works to achieve diversity and it succeeded in having female representation in the management ranks. Specifically, there were a lot of female employees in staff positions. Iparraguirre pointed to this ratio as a potential explanation of the female staff turnover, demotions, and terminations. Iparraguirre requested E17 be contacted to offer insight into Iparraguirre s interactions with female staff. E17 stated his interactions with Iparraguirre were limited to his official duties. In this capacity, E17 worked with Iparraguirre in mostly one-on-one settings. E17 liked working with Iparraguirre, but he did not have any significant interaction with Iparraguirre.
6 Page 6 As to the fourth allegation, regarding Iparraguirre s management style being perceived as autocratic and intimidating, the following information was collected: In July 2015, the Lottery conducted an internal survey as part of an Employee Engagement initiative. The survey allowed employees to submit anonymous comments, and allowed employees to self-identify their department. In response to the question, "What one or two suggestions do you have to help the Lottery improve?" there were ten responses related to Iparraguirre, and there were comments made about two other Executive Team members as well. The comments included the following statements: "I think he [Iparraguirre] has created an environment of fear, is unapproachable, and makes too many emotional decisions"; "Unfortunately, I find the deputy director s management style intimidating and autocratic"; "Please do something about the behavior of the Deputy Director. He is condescending and treats people unfairly"; "It s demeaning and totally deflating to hear the Deputy Director criticize mid-level and executive employees..."; "It seems that he [Iparraguirre], prefers to lead through instilling fear in others and has inserted himself in areas of the organization that are outside the scope of his role." Iparraguirre said he reviewed these comments at the time the results were compiled. Iparraguirre explained that his poor reviews were "easy to explain." Iparraguirre explained that he thought these comments were related to Iparraguirre s role in the VLTMP. Iparraguirre said the Lottery s consultant, Greg Doucette, came into the Lottery and set up a program that would ensure success. Iparraguirre claimed that his implementation of this program was the cause of the negative employee complaints. Iparraguirre also explained that people were not happy with these changes because their work would become more visible. Iparraguirre also stated that he compared comments about him with the comments related to other Executive Team members. According to Iparraguirre, comments regarding his management style were in line with comments about other Executive Team members. The other complaints about Executive Team members were directed at E2 and E5. The complaints directed at E2 focused on a lack of "technical skills," and "making bad business decisions." The complaints directed at E5 were focused on not being effective, "rarely provides valuable input," "disconnected from the reality of his department," and "unengaged lacking leadership skills." Only one complaint about E5 referenced his management style, that "he too likes to criticize staff without specific information or facts." E1 provided information regarding Doucette. According to E1, Roberts and Iparraguirre wanted to bring in Doucette to "whip the program into shape," and he was empowered to do what he needed to do. E1 described Doucette as "not a super friendly gentleman." She also stated that Iparraguirre said "I should fire every one of you" in meetings when tasks were not completed according to Iparraguirre s expectations. As to Iparraguirre s interactions with Janell Simmons on April 18, 2016, the following evidence was collected: On Monday, April 18, 2016, Roberts convened a morning meeting with Art Kiuttu, Farshad Allahdadi (Kiuttu s first-level supervisor), Iparraguirre and Janell Simmons. The purpose of the meeting was to clarify the timeline of Kiuttu s resignation. On April
7 Page 7 7 and 14, 2016, Kiuttu sent two separate s about resigning from the Lottery and indicating an effective date of July 1, During the meeting, Roberts discussed moving up Kiuttu s effective resignation date to May 1, Iparraguirre arrived a few minutes late to the meeting, and he missed the first part. Iparraguirre and Simmons have different accounts of their interactions throughout the remainder of the day after the meeting broke. As the Chief Human Resource Officer, Simmons is a direct report to the Director, and the Director has authority to terminate her employment. Information from Simmons According to Simmons, after the meeting broke, she talked with E13 about an unrelated matter. Iparraguirre caught up to her as she was leaving E13 s office, and called Simmons into his office. Iparraguirre asked Simmons what the meeting with Art Kiuttu was about, and Simmons stated she did not have any advance notice of the meeting and she did not talk with Roberts about the meeting ahead of time. Simmons recapped the part of the meeting Iparraguirre missed, and Simmons stated she felt it was awkward in the way Roberts talked with Kiuttu. Iparraguirre told Simmons "he was watching my [Simmons ] body language closely to see if I [Simmons] was in on this action against Art." Simmons stated she did not know about the meeting prior to Roberts calling the meeting. According to Simmons, Iparraguirre then said it would be retaliation to move up Kiuttu s retirement to the end of April. Simmons told Iparraguirre about earlier conversations she had with Roberts about moving up Kiuttu s retirement date, and Roberts wanted to move up the resignation date because Kiuttu was not able to work well with his new first-level supervisor, Allahdadi. Simmons went on to say that "there is nothing illegal about moving up Art s retirement date," and she told Roberts the same. Iparraguirre was not happy that Simmons provided this advice to Roberts, and claimed it was retaliation against Kiuttu for talking with Lottery Commissioners. According to Simmons, Iparraguirre stated that he was really concerned and that "things are going to start happening today," and he was very intense throughout the meeting. Iparraguirre stated that "people are going to take over from the Governor s office and that if we have not been given good advice that they are going to look at everything..." As an example of good advice she gave, Simmons started talking about Allahdadi and the letter to BOLI prepared by Roberts. Iparraguirre went on to say, "Heidi [Moawad] is a litigation attorney and they are going to dig deep and they may not like some of the things they hear." Simmons stated she was very stressed out, and she told Roberts earlier that much of the turmoil at the Lottery was self-imposed and she did not want to be in the middle of it. Iparraguirre moved the conversation to an incident he heard occurred between Roberts and E5. Iparraguirre stated E5 told him about an inappropriate comment made by Roberts in connection to E5 s upcoming trip to Pakistan. Simmons stated she was present for the comment, and told Roberts he cannot make such an inappropriate joke. At the end of the meeting with Iparraguirre, Simmons reported feeling like she was going to be fired, and she returned to her office. Around 2:30pm that afternoon, Simmons said she received a telephone call from
8 Page 8 Iparraguirre. Iparraguirre said "it s happening, I got a call from Liz [Carle], and this is what we talked about," "Mary [Wheat] had a meeting with the Governor today and Liz has one tomorrow. Stand by your phone she [Carle] will be calling you." Around 3:00pm, Simmons received a call from Carle. Simmons stated that Carle disclosed she talked with Iparraguirre and asked about an uncomfortable meeting that occurred earlier in the day. Simmons asked if Carle was asking about the meeting with Kiuttu, and Carle said yes. Simmons told Carle about the meeting with Kiuttu and answered Carle s questions. Information from Iparraguirre Iparraguirre has a different version of events. According to Iparraguirre, after the meeting with Kiuttu broke, he talked with Roberts and stated his concern that Kiuttu "can be developing a very good case against the lottery." As Iparraguirre left Roberts s office, he saw Simmons and asked her to meet with him. Iparraguirre asked if HR was involved in the meeting with Kiuttu, and Simmons stated she did not know much about the meeting, but that Roberts wanted Kiuttu out as soon as possible. Simmons told Iparraguirre about the beginning of the meeting, which Iparraguirre missed, and she stated that Roberts mentioned something related to Kiuttu talking with Lottery Commissioners. During the investigative interview, Iparraguirre characterized the meeting with Simmons as, "it was her basically venting to me." Iparraguirre stated it was at this point that Simmons "mentioned that she was very stressed out because Jack is irrational and making decisions that could jeopardize her job." During the investigative interview, Iparraguirre said he told Simmons, "you are a young professional, you have a young family, you can have a long career." Iparraguirre and Simmons next talked about Allahdadi and the letter to BOLI prepared by Roberts. Simmons told Iparraguirre that Allahdadi received a copy of the letter to BOLI from Roberts on the preceding Friday, April 15, and showed it to Simmons. Iparraguirre and Simmons also discussed the "offensive statement [made by Roberts] during an ELT meeting. Iparraguirre denied making the statement to Simmons that moving up Kiuttu s retirement was unlawful retaliation, and he denied talking with Simmons about Kiuttu s retirement date at all during their meeting. After the meeting, Iparraguirre called E4 because he was also an attorney. Iparraguirre called E4 "to discuss the subject of Janell s complaints." Iparraguirre reached the conclusion that he had "an obligation to act in order to minimize liability to the Lottery and to diminish embarrassment and surprise to the Governor s office." Later in the afternoon, Iparraguirre received a call from Carle, who mentioned that E4 had called her. Carle told Iparraguirre that E4 told her about Iparraguirre s conversation with Simmons. Iparraguirre told Carle about her conversation, and Carle asked for Simmons phone number. Iparraguirre then called Simmons and let her know that Carle would be calling with some questions, soon. Iparraguirre described his relationship with Simmons as a good working relationship and that he respects Simmons.
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