Report: JC city manager inappropriately berated employee, no evidence of ‘undue influence’ around building codes enforcement

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Outside attorney found multiple instances of berating and demeaning comments to subordinates

JOHNSON CITY, Tenn. (WJHL) – Johnson City City Manager Pete Peterson sometimes uses “language and a temperament that many would consider to be unprofessional, overbearing and, perhaps even, ‘bullying,'” an independent investigation that included interviews with 20 current employees found.

A lengthy report from Knoxville attorney Benjamin Lauderback, stemming from a formal complaint by a city employee, noted, however, that Peterson has a strong track record of leading the city. It also did not find any evidence Peterson exercised “undue influence” over building code enforcement.

Lauderback wrote that parallel to his record of achievements, Peterson’s track record of a management approach that “can and does cross the border of profane and demeaning” affects morale and opens the city to potential litigation.

One of the emails that sparked Roger Davis’s formal complaint.

He also suggested Peterson could change that element of his management style “with ample direction and perhaps additional training.” Peterson has been city manager since 2004, including a year as interim, and has worked for the city for nearly 30 years.

Lauderback wrote that both Peterson and complainant Roger Davis were “cordial, professional and forthcoming” in their interviews with him and that Peterson acknowledged his actions in the matter that spurred the complaint were wrong.

In a phone interview with News Channel 11, Peterson acknowledged that communication has been an ongoing weakness for him.

“All of us are human,” Peterson said. “We all have our strengths and weaknesses and we all have distinct and unique personalities, and whether you’re a city manager or an elected official or somebody that works for WJHL.

Peterson said the communication issue has been noted in previous evaluations and that he’s worked on it.

“I think one of the takeaways from this report is there’s still work to be done there for me to improve my communication skills. I’m dedicated to continue to work on that and make improvements.”

The city commission is set to complete a delayed performance review of Peterson by the end of January and plans to incorporate findings from the report into that.

In a formal complaint filed in September Davis, a fire prevention officer, alleged Peterson engaged in both bullying behavior and undue influence over codes issues. The complaint prompted then-Mayor Jenny Brock to solicit an investigation.

Lauderback’s report became public Wednesday following a called meeting of the commission to discuss it Tuesday.

Lauderback said numerous employees he interviewed, mostly associated with the fire and building departments, described Peterson’s management style as sometimes demeaning. Included were descriptions of Peterson saying multiple times a subordinate “‘needs to be looking for a new job,’ or words to that affect…”

Without documentation regarding job performance, Lauderback wrote, “using such phrases is destructive for morale and inappropriate. In other words, using such statements as merely a motivational tool should be stopped immediately.”

In generally positive job reviews, commissioners have given Peterson some of his lowest ratings on issues related to employee morale. His 2017 review had more than 75 scored “attributes” rated from 1 to 5.

Peterson’s lowest score on any attribute was 2.2 and that occurred on five. Among them were:

  • “Supports competent staff for promotion wherever appropriate”
  • “Encourages creativity by staff”
  • “Recognizes the importance of good employee morale”
  • “Delegates decision making when appropriate”
  • “Gains the confidence of city employees”

‘Intent’ vs ‘Impact’

Lauderback found that Peterson’s communication shortcomings seemed to come from an intent to motivate employees.

The impact, he wrote, “is demoralizing for the particular employee who is subjected to the tirade and it is embarrassing and affects the morale of those who have to view it. This ‘intent v. impact’ seems to be lost on Mr. Peterson.”

Lauderback made several strong suggestions that the city commission take some action.

“To the extent that the commission desires to act to condemn that type of behavior and language by Mr. Peterson, be it as it relates to the Roger Davis complaint or otherwise, I think such a course of action would be appropriate,” Lauderback wrote.

“That could include, but not be limited to, a public censure or admonishment of his actions. Certainly, training for him would be a reasonable requirement.”

Lauderback noted the possibilities that the city could risk legal action in the future and that the climate created by serial demeaning of some employees is bad for overall morale.

In the case of Davis and a mid-August incident surrounding use of the old Ashe Street courthouse to house homeless COVID patients, Lauderback found Peterson “unnecessarily berat(ed) an employee who by all accounts was just trying to do his job on a Saturday morning…”

At the same time, Lauderback noted that Peterson and others worked diligently to try and devise a solution to one of many challenges that have arisen during the pandemic.

The problem, he wrote, came when communication broke down following Davis’s suggestion that he forward information about use of the building to the state fire marshal. That resulted in what Peterson acknowledged to Lauderback was frustration — followed by the inappropriate emails that included profanity and what Davis saw as threats to his job.

No evidence of interference with codes enforcement

Davis leveled an allegation at least as serious as the communication issue in his complaint. He wrote that Peterson “has attempted to exert undue influence on plans review, construction approvals, fire prevention activities and fire code enforcement to the point where two senior fire prevention officers are hesitant to make the necessary and appropriate decisions…”

Lauderback looked deeply into that matter, reviewing several instances in which Peterson was involved in high-profile projects.

“I found no evidence to support a claim that Mr. Peterson has ever attempted to unduly influence any Johnson City employee with a responsibility to enforce code to a degree where he ordered that they ignore code, circumvent code, disregard code or fail to enforce code,” he wrote.

One instance involved Crown Labs’ early 2020 expansion to stand up a hand sanitizer operation that would add significant numbers of jobs. That was “repeatedly referenced as being one where Mr. Peterson exercised undue influence,” Lauderback wrote.

He said Davis gave him the perception that Peterson’s statement “we’re gonna get this done” was “made in spite of and not in accordance with applicable codes.”

Then Lauderback interviewed those involved with the process and “learned that simply was not the case.”

Those subjects “noted that Mr. Peterson did not order anyone to ignore applicable code provisions.” Lauderback called the project “a sound example of what can happen when these departments get along and work together,” referring to fire prevention, codes enforcement and development services.

Peterson himself on Wednesday raised what he called a breakdown of communication between fire inspection, codes enforcement and building trades inspectors that has “ebbed and flowed through the years.”

“It’s definitely not something that’s insurmountable,” Peterson said.. We can get to work on that real quick and we’re going to.

“At the end of the day we work for the people that live here. Everybody’s our customer and the only thing that we sell is customer service. It’s incumbent upon us as local government employees to help people find solutions to their challenges and that’s what we’re committed to doing. We’re gonna make things better.”

Commission has the next move

Lauderback suggested the commission, which he noted has been “accepting and generally pleased” with Peterson’s work, “look itself in the eye” when considering whether “the ends justify the means” when it comes to Peterson’s management style.

“Acceptance of this type of ‘management’ will logically result in a trickle-down effect to department heads, etc.,” he wrote. “Again, this works in certain situations, but in most it does not and can eventually lead to unwanted litigation.”

Mayor Joe Wise referenced morale and talent attraction and retention in an interview Tuesday night following the city commission’s initial discussion of the report.

He suggested the city will get the best from its employees by encouraging “an environment of appropriate risk-taking, exploration, innovation, self-reflection.

“I think as a city we have opportunities to support and encourage and facilitate more of that and it’s in our interest to reward people who look at things that have always been the way they’ve always been and say, ‘but why not? Why can’t we do this better, why can’t we do this different…

“I think the only way you’re going to get to something that looks like that is to be willing to encourage and embrace and reward and incentivize that kind of effort.”

Wise said the commission should finish its evaluation and take any action related to the report within weeks.

You can read the full report here.

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