Title: City of Casper v. Wyoming Dept. of Employment, Unemployment Ins. Div.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

City of Casper v. Wyoming Dept. of Employment, Unemployment Ins. Div.1993 WY 60851 P.2d 1Case Number: 92-173Decided: 04/16/1993Supreme Court of Wyoming
CITY OF 
CASPER,

 Appellant 
(Petitioner),

v.

WYOMING DEPARTMENT OF 
EMPLOYMENT, UNEMPLOYMENT INSURANCE DIVISION, 

Appellee (Respondent), 

Daryl BOWEN, 

(Claimant-Party In 
Interest).

Appeal from District 
Court of Natrona County, Dan Spangler, J.

Gayla Lou 
Daniels, Deputy City Atty., Casper, for appellant.

Joe Scott, Sr. 
Asst. Atty. Gen., Casper, for appellee.

Before MACY, 
C.J., and THOMAS, CARDINE, GOLDEN and TAYLOR, JJ.

CARDINE, 
Justice.

[¶1]      The City of 
Casper (City) seeks review of the decision of the Unemployment Insurance 
Commission (Commission), affirmed by the district court, awarding a former city 
employee unemployment benefits.

[¶2]      We 
affirm.

[¶3]      The City presents 
for our determination, the following four issues:

I. Whether the decision 
of the Unemployment Insurance Commission reversing the determination of the 
Chief Examiner based on the finding by the Commission that "the evidence of what 
happened between the claimant and the two female coworkers is primarily, if not 
totally, hearsay" and therefore that "claimant's firsthand sworn testimony about 
what happened is more persuasive," is arbitrary, capricious, an abuse of 
discretion or otherwise not in accordance with law.

II. Whether the decision 
of the District Court affirming the decision of the Unemployment Insurance 
Commission on the basis that the hearsay evidence presented by the appellant 
does not meet the standard of reliability and credibility necessary to 
constitute substantial evidence is arbitrary, capricious, an abuse of discretion 
or otherwise not in accordance with law.

III. Whether the decision 
by the Unemployment Insurance Commission reversing the determination by the 
Examiner is supported by substantial evidence in a case reviewed on the record 
of an agency hearing provided by statute.

IV. Whether the decision 
by the District Court affirming the decision of the Unemployment Insurance 
Commission on the basis of the lack of credibility of the hearsay evidence is 
supported by substantial evidence in a case reviewed on the record of an agency 
hearing provided by statute.

[¶4]      The Commission 
states the issues as follows:

I. Whether the Decision 
of the Unemployment Insurance Commission is supported by substantial evidence, 
is arbitrary, unreasonable, or an abuse of discretion, and is in conformity with 
law?

II. Whether and to what 
extent the Commission is bound by the decision and findings of the Appeals 
Examiner?

FACTS

[¶5]      Daryl Bowen was 
employed as a maintenance worker by the City from September 5, 1980, until July 
17, 1991. During this time, Bowen was involved in several employment related 
problems. During the first five years of his employment, Bowen received only one 
written reprimand. However, from 1985 to 1987 Bowen received two suspensions 
without pay, 11 verbal warnings, two written reprimands, one incident of 
violence, and one termination proceeding was brought against him. The City 
ultimately transferred Bowen from cemetery maintenance to park 
maintenance.

[¶6]      Bowen's job 
performance improved in his new position. From 1988 to 1990, Bowen received two 
written reprimands. On his last yearly evaluation, Bowen was rated as standard 
or outstanding in all categories. During the summer of 1991, however, Bowen was 
again the subject of controversy.

[¶7]      The City hired 
unskilled young people to supplement the city maintenance work force during the 
summer. In past years, Bowen was assigned both male and female workers to 
supervise with no apparent problems. In the summer of 1991, Bowen was assigned 
two female workers.

[¶8]      One day Bowen 
left the two summer workers to clean tennis courts in one of the City's parks 
while he left to do other work. When he came back about three hours later, the 
courts were not clean and little work seemed to have been done. The next morning 
he again dropped them off at the courts. He returned several hours later to find 
that they still were not clean. He again left the summer workers with 
instructions to clean the tennis courts.

[¶9]      The next day 
Bowen discovered that the courts still were not satisfactorily cleaned. Bowen 
decided to personally supervise the summer workers and help clean the courts. 
While doing this, one of the summer workers suggested that Bowen finish the 
cleaning while she and the other summer worker would go work on a tennis court 
elsewhere in the city. Bowen said "no" because a tennis tournament was scheduled 
for later that day. When the summer worker persisted, Bowen became angry and 
began loudly yelling at the young women. A citizen observed Bowen's yelling and 
complained to the City.

[¶10]   As a result of the complaint, the 
director of the Parks Department asked to meet with the girls in his office. 
During this meeting, the summer workers relayed to the director several 
incidents in which Bowen's behavior toward them appeared to violate the City's 
sexual harassment policy. They said that Bowen had made statements indicating he 
would like to see them in a "wet t-shirt contest," that Bowen had made several 
comments concerning the large size of one summer worker's bust, and finally, 
Bowen was accused of making unwanted lewd remarks, jokes and describing in 
detail an oral sex act which he had witnessed.

[¶11]   Bowen denied the statements. He 
indicated that others had made the wet t-shirt and large bust remarks. Bowen 
claimed that he told just two lewd jokes and then only after he had obtained the 
summer worker's permission. Finally, Bowen denied telling the young women in 
detail that he had witnessed an oral sex act, although he did admit to having 
mentioned it.

[¶12]   As a result of the above and 
Bowen's history of problems, his employment with the City was terminated. Bowen 
applied to the Commission for benefits which, after an initial hearing, were 
denied upon the grounds that his termination was the result of misconduct. Bowen 
appealed this decision to the Commission's Chief Appeals Examiner. The decision 
was affirmed. Bowen next appealed to the Unemployment Insurance Commission. The 
Commission reversed the Examiner's decision and held that Bowen was qualified 
for benefits because he had not engaged in misconduct. The City appealed the 
Commission's decision awarding benefits to the district court, which affirmed 
the Commission's decision. The City now appeals to this 
Court.

DISCUSSION

[¶13]   Appellant contends that the 
Commission's decision was arbitrary and capricious and not supported by 
substantial evidence as required by W.S. 16-3-114(c), which 
provides:

To the extent necessary 
to make a decision and when presented, the reviewing court shall decide all 
relevant questions of law, interpret constitutional and statutory provisions, 
and determine the meaning or applicability of the terms of an agency action. In 
making the following determinations, the court shall review the whole record or 
those parts of it cited by a party and due account shall be taken of the rule of 
prejudicial error. The reviewing court shall:

(i) Compel agency action 
unlawfully withheld or unreasonably delayed; and

(ii) Hold unlawful and 
set aside agency action, findings and conclusions found to 
be:

(A) Arbitrary, 
capricious, an abuse of discretion or otherwise not in accordance with 
law;

(B) Contrary to 
constitutional right, power, privilege or immunity;

(C) In excess of 
statutory jurisdiction, authority or limitations or lacking statutory 
right;

(D) Without observance of 
procedure required by law; or

(E) Unsupported by 
substantial evidence in a case reviewed on the record of an agency hearing 
provided by statute.

[¶14]   The City claims that the record 
demonstrates with clarity that Bowen engaged in misconduct and that unemployment 
benefits may not be awarded when termination is due to misconduct under W.S. 
27-3-311(c), which provides:

An individual shall be 
disqualified from benefit entitlement and shall forfeit all accrued benefits if 
he was discharged from his most recent work for misconduct connected with his 
work, fraud in connection with a claim for benefits or receipt of disqualifying 
income.

[¶15]   Thus, the City maintains there is 
not substantial evidence in this record to support the Commission's finding that 
Bowen did not engage in misconduct. To appropriately consider this claim by the 
City, we must determine what is meant by the terms "substantial evidence" and 
"misconduct."

[¶16]   When reviewing an agency decision, 
we have said that substantial evidence is "such relevant evidence as a 
reasonable mind might accept as adequate to support a conclusion. Such evidence 
may be less than the weight of the evidence but cannot be contrary to the 
overwhelming weight of the evidence." Barker v. Employment Sec. Comm'n, 791 P.2d 583, 585 (Wyo. 1990) quoting Big Piney Oil & Gas Co. v. Wyoming Oil and Gas 
Conservation Comm'n, 715 P.2d 557, 561-62 (Wyo. 1986).

[¶17]   We have defined misconduct 
as:

"Misconduct under the 
Wyoming Employment Security Law means generally an act of an employee which 
indicates a disregard of (1) the employer's interests or (2) the commonly 
accepted duties, obligations and responsibilities of an employee. This would 
include carelessness or negligence of such degree or recurrence as to reveal 
willful intent or an intentional disregard of the employer's interests or of the 
employee's duties and obligation to his employer. Inefficiency or failure in 
good performance as the result of inability or incapacity; ordinary negligence 
in isolated instances or good faith errors in judgment or discretion are not 
deemed to be misconduct within the meaning of the Law."

Barker, 791 P.2d  
at 585-86 quoting Safety Medical Serv., Inc. v. Employment Sec. Comm'n, 724 P.2d 468, 472 (Wyo. 1986).

[¶18]   It is clear from the articulated 
definitions of substantial evidence and misconduct that the Commission's 
decision was well within their authority. First, "a reasonable mind might accept 
as adequate" Bowen's version of the facts. The evidence against Bowen was almost 
entirely hearsay. The summer workers did not testify at the hearing. Instead, 
all of the testimony relating to sexual harassment and the shouting incident was 
from persons with no direct knowledge of what occurred. The testimony consisted 
generally of what they were told by the summer workers. Thus, in resolving the 
disputed questions of fact, it was reasonable for the Commission to accept 
Bowen's testimony over the hearsay related by his 
supervisors.

[¶19]   The Commission, then having 
accepted Bowen's testimony, could find such to be substantial evidence 
indicating that he did not engage in misconduct. Bowen's job performance in 
recent years was adequate. Bowen's explanations of the recent incidents which 
led to his termination can reasonably be characterized as "good faith errors in 
judgment" which "are not deemed to be misconduct." Barker, 791 P.2d  at 586. Upon 
these findings, the Commission appropriately held that Bowen was qualified for 
benefits.

[¶20]   Appellant makes a final contention 
that the Commission should not have reversed the Examiner's decision. The 
Commission's authority to review the Examiner's decision is found in W.S. 
27-3-404(b), which provides:

Upon review or appeal and 
based on evidence previously submitted or upon additional evidence it may direct 
be taken, the commission may affirm, modify or reverse the findings and 
conclusions of the appeal tribunal. [emphasis added]

[¶21]   The clear language of W.S. 
27-3-404(b) allows the Commission to look at the same evidence and come to a 
conclusion different than that of the Examiner. We have previously identified 
the Commission as the final agency adjudicating authority when we 
said:

The Commission's final 
decision is the decision to be reviewed by the district court under W.R.A.P. 12, 
not those decisions which were made at intermediate stages in the 
process.

Wyoming Dep't of 
Employment, Div. of Unemployment Ins. v. Rissler & McMurry Co., 837 P.2d 686, 691 (Wyo. 1992). The Commission could properly reverse the Examiner's 
decision, and we review only the decision of the Commission for substantial 
evidence.

[¶22]   The decision of the district court 
affirming the Commission's decision to award benefits is 
affirmed.