Can an Arkansas public hospital withhold settlement agreements with departing employees as a privacy invasion?

Plain-English summary

Drew Memorial Hospital in Monticello had reached settlement agreements with two departing employees through EEOC mediation. After the hospital board approved the settlements, the hospital received two FOIA requests for "all documents relating to the employee settlements." The hospital's attorney, C.C. Gibson III, took the initial position that the documents were personnel records whose release would be a clearly unwarranted invasion of personal privacy, and that EEOC rules also barred disclosure. He asked the AG whether that nondisclosure decision was consistent with Arkansas FOIA.

The AG would not look at the documents themselves, but he laid out three propositions his office had consistently held: (1) settlement agreements with public-employer entities qualify as public records under FOIA; (2) such settlement agreements are personnel records of the employee who signed them; and (3) the personnel-records balancing test under Young v. Rice usually requires disclosure of settlement agreements. The General Assembly, in A.C.A. § 25-18-401, made clear that there is an "extremely high public interest" in the entirety of a public entity's settlement agreement. While it was theoretically possible for an employee's privacy interest to override that public interest, the AG had no way to know whether that was true here because he had not been given the documents.

The AG also told Gibson that EEOC procedural concerns were outside the scope of his review under A.C.A. § 25-19-105(c)(3)(B)(i), which only extends to FOIA's personnel-records and employee-evaluation exemptions. EEOC issues would have to be sorted out separately.

Currency note

This opinion was issued in 2014. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Background and statutory framework

A FOIA-covered record must be disclosed unless (1) the request goes to a covered entity, (2) the document is a public record, and (3) no exception applies. The hospital's custodian had already determined the settlement agreements were personnel records under A.C.A. § 25-19-105(b)(12). That exemption applies only "to the extent that disclosure would constitute a clearly unwarranted invasion of personal privacy."

The Arkansas Supreme Court in Young v. Rice (1992) set up a two-step balancing test for personnel records:

1. Does the information rise above a de minimus privacy interest? If not, the disclosure thumb on the scale wins.
2. If there is a more-than-de-minimus privacy interest, does the public's interest in disclosure outweigh it? Under Stilley v. McBride, the burden is on the party resisting disclosure to show that privacy outweighs public interest.

The test is objective. The employee's own preference about disclosure is irrelevant. Even a record that overall must be disclosed may need targeted redactions, and the AG opinion lists items routinely redacted: dates of birth (Op. 2007-064), Social Security numbers (Ops. 2006-035, 2003-153), medical information (Op. 2003-153), driver's license numbers (Op. 2007-025), insurance coverage (Op. 2004-167), tax/withholding information (Ops. 2005-194, 2003-385), and payroll deductions (Op. 98-126).

Settlement agreements occupy a special place in the analysis. The AG cited his Opinion No. 2007-003 for the proposition that the General Assembly, in enacting A.C.A. § 25-18-401, recognized an "extremely high public interest" in the entirety of a public entity's settlement agreement. The legislative judgment baked into that statute means privacy interests rarely outweigh disclosure interests when the document is a settlement between a public employer and a (former) employee.

Common questions

Do EEOC mediation rules block FOIA disclosure?

Federal EEOC rules on mediation confidentiality cannot, by themselves, override Arkansas FOIA. They might affect how the parties got to the settlement (whether the mediation discussions stay confidential), but the AG's FOIA review under A.C.A. § 25-19-105(c)(3)(B)(i) is limited to personnel-records and evaluation-records exemptions. The hospital would have needed a separate legal theory tying EEOC confidentiality to an Arkansas FOIA exemption to keep the settlements out of public view, and the AG did not see one in the request letter.

Were the settlement amounts the most likely thing to be redacted?

No. The AG's general view is that the settlement payment is precisely the kind of fact the public wants to know about. Things like Social Security numbers or medical-condition narratives might be redacted; the dollar amount almost never is. Read the list of routinely-redacted items above and notice what is not on it.

What if the agreements contained a confidentiality clause?

That alone wouldn't change the analysis. Public records do not lose their public character because the parties wrote "confidential" on them or agreed to keep them secret. The custodian and a reviewing court still apply the personnel-records balancing test, and a contractual confidentiality clause is at most one factor in the privacy column.

What did the AG actually do?

He declined to rule on the specific documents because he had not seen them, but he made clear the custodian's position (privacy invasion plus EEOC bar) was not, on its face, consistent with how Arkansas FOIA usually treats public-employer settlement agreements. The custodian would have to apply the Young v. Rice balancing test to the specific documents, with the burden falling on the party resisting disclosure.

How could a requester challenge the denial?

By filing a circuit-court action under A.C.A. § 25-19-107 to compel production. The AG's opinion would be persuasive but not binding. Given the way the AG framed the analysis here, a requester walking into court with this opinion would have had significant momentum.

Source

• Landing page: https://arkansasag.gov/divisions/opinions-foia/attorney-general-opinions-search/

Original opinion text

STATE OF ARKANSAS
THE ATTORNEY GENERAL
Dustin McDANIEL

Opinion No. 2014-120
October 23, 2014

C.C. Gibson, III, Esq.
Gibson & Keith, PLLC
119 South Main Street
Post Office Drawer 447
Monticello, Arkansas 71655-0447

Dear Mr. Gibson:

You have requested my opinion regarding the Arkansas Freedom of Information Act ("FOIA"). Your request, which is made as the custodian's attorney, is based on A.C.A. § 25-19-105(c)(3)(B)(i) (Supp. 2013). This subsection authorizes the custodian, requester, or the subject of personnel or employee evaluation records to seek an opinion from this office stating whether the custodian's decision regarding the release of such records is consistent with the FOIA.

Your letter indicates that you represent Drew Memorial Hospital in Monticello, Arkansas. You say that the hospital's board held a meeting at which the board approved settlements with two hospital employees. You say that one of those employees had previously resigned, and that the other resigned "in connection with the settlement agreement." Soon after the board's meeting, the hospital received two FOIA requests that seek "all documents relating to the employee settlements." You say that your "initial reaction and advice to the hospital" was that the requested documents are exempt from disclosure because they "appear to be 'personnel records' ...the disclosure of which could be construed to constitute a clearly unwarranted invasion of the personal privacy of the employees involved." You also express concern that, due to the involvement of and order from a mediator with the Equal Employment Opportunity Commission (EEOC), the records cannot be disclosed pursuant to EEOC's requirements.

You ask whether, in light of the foregoing, the settlement agreements must be disclosed.

RESPONSE

My statutory duty is to state whether the custodian's decision is consistent with the FOIA. Because I have not seen any of the records at issue, I cannot opine about the disclosure of any specific document. Further, I cannot assess your EEOC concerns because my review under section 25-19-105(c)(3)(B)(i) extends to the applicability of the exemptions for personnel records (i.e., -105(b)(12)) and employee evaluations (i.e., -105(c)(1)). But I can explain how the FOIA applies to settlement agreements between employers and (former) employees. In short, this office has repeatedly opined (1) that such settlement agreements qualify as public records, (2) that they are considered the personnel records of the employee who entered into that agreement, and (3) that the personnel-records balancing test usually requires such agreements be disclosed.

DISCUSSION

A document must be disclosed in response to a FOIA request if all three of the following elements are met. First, the FOIA request must be directed to an entity subject to the act. Second, the requested document must constitute a public record. Third, no exceptions allow the document to be withheld. I will focus my analysis on the third element.

The custodian has determined that the settlement agreements at issue here are personnel records. This conclusion is consistent with this office's opinions. Therefore, I will confine my subsequent analysis to this exception.

All personnel records are open to public inspection and copying except "to the extent that disclosure would constitute a clearly unwarranted invasion of personal privacy." While the FOIA does not define the phrase "clearly unwarranted invasion of personal privacy," the Arkansas Supreme Court, in Young v. Rice, has provided some guidance. To determine whether the release of a personnel record would constitute a "clearly unwarranted invasion of personal privacy," the court applies a balancing test that weighs the public's interest in accessing the records against the individual's interest in keeping them private. The balancing takes place with a thumb on the scale favoring disclosure.

The balancing test elaborated by Young v. Rice has two steps. First, the custodian must assess whether the information contained in the requested document is of a personal or intimate nature such that it gives rise to a greater than de minimus privacy interest. If the privacy interest is merely de minimus, then the thumb on the scale favoring disclosure outweighs the privacy interest. Second, if the information does give rise to a greater than de minimus privacy interest, then the custodian must determine whether that interest is outweighed by the public's interest in disclosure. Because the exceptions must be narrowly construed, the person resisting disclosure bears the burden of showing that, under the circumstances, his privacy interests outweigh the public's interests. The fact that the subject of any such records may consider release of the records an unwarranted invasion of personal privacy is irrelevant to the analysis because the test is objective.

Whether any particular personnel record's release would constitute a clearly unwarranted invasion of personal privacy is always a question of fact. Even if a document, when considered as a whole, meets the test for disclosure, it may contain discrete pieces of information that have to be redacted.

The custodian has determined that the personnel-records balancing test, which was set out above, requires that the settlement agreements be withheld from disclosure because, as you say, their disclosure "could be construed to constitute a clearly unwarranted invasion of personal privacy." But you do not give any reasons to support that conclusion. Nor do you apply the two-part test explained above.

This office has opined that, in most cases, such settlement agreements must be disclosed. As I explained in Opinion No. 2007-003, the General Assembly has (by virtue of A.C.A. § 25-18-401) made it clear that there is an extremely high public interest in the entirety of a public entity's settlement agreement. So while it is theoretically conceivable that a privacy interest can be so great that it overcomes the high public interest in a settlement agreement, I have no way to know whether that is the case here because I have not seen the documents.

The custodian should apply the foregoing test to determine whether the personnel-records exception requires that the records be disclosed. As you yourself note, EEOC statutes and regulations could have some bearing on the disclosure of this material. But a review of EEOC provisions is outside the scope of my review under 25-19-105(c)(3)(B)(i).

Assistant Attorney General Ryan Owsley prepared this opinion, which I hereby approve.

Sincerely,

DUSTIN MCDANIEL
Attorney General

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