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### STATE OF MICHIGAN

COURT OF APPEALS

AISHA NICHOLS,

Claimant-Appellant, UNPUBLISHED November 19, 2015

v No. 322231 Wayne Circuit Court AUTO CLUB SERVICES, INC., LC No. 14-001823-AE

Respondent,

and

DEPARTMENT OF TALENT AND ECONOMIC
DEVELOPMENT/UNEMPLOYMENT INSURANCE AGENCY,

Respondent-Appellee. 1

Before: J ANSEN , P.J., and M URPHY and R IORDAN , JJ.

P ER C URIAM

.
Claimant, Aisha Nichols, appeals by leave granted 2 a circuit court order affirming a decision by the Michigan Compensation Appellate Commission (“MC AC”), which affirmed the decision of an administrative law judge (“ALJ”) finding that cl aimant was properly disqualified from receiving unemployment benefits. On appeal, claimant argu es that the decisions of the lower tribunals are contrary to law because the tribunals faile d to apply, in determining whether claimant’s absences constituted disqualifying misconduct, the c orrect standard for absences that are beyond an employee’s control. Claimant also argues that th e circuit court erred in concluding that the ALJ’s factual findings were supported by co mpetent, material, and

1 Because respondent Auto Club Services, Inc., is not a party in this appeal, we will refer to respondent Department of Talent and Economic Development/Unempl oyment Insurance Agency as “respondent” i n this opinion.

2 Nichols v Auto Club Servs, Inc , unpublished order of the Court of Appeals, entered October 30

, 2014 (Docket No. 322231).-2- substantial evidence. We agree that claimant’s disqualificatio n from unemployment benefits was contrary to law and reverse.

I. FACTUAL BACKGROUND

This case arises from claimant’s application for unemployment b enefits following her discharge from Auto Club Servic es, Inc. (“ACS”) in March 2013. In October 2012, claimant was hired as a customer sales and service representative at ACS . ACS had a written no-fault attendance policy with no written exceptions, and exceptions we re “very rare” in practice. ACS employees received three days off from work every six months, w hich the employees earned after working for 90 days as long a s they were not “on formal d iscipline.”

Between December 3, 2012, and February 25, 2013, claimant recei ved three written discipline notices, two of which were related to being absent f rom work or leaving work early. The absence giving rise to the last discipline notice was illne ss-related, and claimant sought
medical treatment for her condition.

On February 28, 2013, claimant’s vision became blurry and she w as unable to see while she was driving to work. This was the second time that she had experienced blurred vision, and
she was concerned that she was “having a thyroid storm.” After she pulled over to the side of the road, a man assisted her in calling ACS so that she could leave a voicemail message regarding her absence that day. Claimant testified that she stated in th e voicemail that (1) the reason for her absence was “personal,” (2) she would explain the reason fo r her absence when she returned, and (3) she would ret urn to work on March 1, 2013.

When claimant returned to work on March 1, 2013, she was disch arged from ACS for her absence on February 28, 2013. As she was being discharged, cla imant explained to her supervisor that she had not been feeling well and had been unab le to see, but she did not provide documentation from her doctor confirming this condition. Follo wing her termination, claimant never gave ACS a doctor’s statement or any other medical docume ntation regarding the circumstances of her medical condition on February 28, 2013. I t is unclear from claimant’s testimony at the hearing before th e ALJ whether she provided AC S with a statement from her doctor regarding her medical condition earlier in February 2013 , but claimant did testify that she told her employer that she was not feeling well prior to the ti me that she was discharged.

Claimant sought unemployment benefits under the Michigan Emplo yment Security Act (“MESA”), MCL 421.1 et seq . The State of Michigan Unemployment Bureau disqualified her from receiving unemployment benefits pursuant to MCL 421.29(1)( b) on the basis that claimant was terminated for deliberately disregarding her employer’s int erest. Claimant subsequently appealed the agency’s decision to an ALJ, the MCAC, and the Way ne Circuit Court. At the hearing before the ALJ, the part ies stipulated that claimant’s absences were related to an illness or medical condition, although the parties dispute on appeal wh ether the ALJ accepted that stipulation. Regardless, the t ribunals below affirmed claimant ’s disqualification from unemployment benefits.

II. STANDARDS OF REVIEW-3- The Michigan Supreme Court rece ntly explained the standard of review applicable to unemployment benefit claims based on Article 6, § 28 of Michiga n’s 1963 Constitution, which provides the standard of review applicable to a decision of an administrative body; MCL 421.34, which pertains to an appeal from an ALJ to the MCAC; and MCL 42 1.38, which also pertains to an appeal from the MCAC to a circuit court:

[A] circuit court must affirm a decision of the ALJ and the MCA C if it conforms to the law, and if competent, material, and substantial evidenc e supports it. A reviewing court is not at liberty to substitute its own judgmen t for a decision of the MCAC that is supported with substantial evidence. The Cour t of Appeals
then reviews a circuit court’s decision to determine whether th e lower court applied correct legal principles and whether it misapprehended or misapplied the
substantial evidence test to the agency’s factual findings . . . . [ Hodge v US Security Assoc, Inc , 497 Mich 189, 193-194; 859 NW2d 683 (2015) (quotation marks and footnotes omitted).]

As such, our review of the lower court’s application of the “su bstantial evidence test”

is indistinguishable from the cl early erroneous standard of rev iew that has been widely adopted in Michigan jurisprudence. As defined in numero us other contexts, a finding is clearly e rroneous when, on review of the whole record, this
Court is left with the definite and firm conviction that a mist ake has been made. [ Logan v Manpower of Lansing, Inc , 304 Mich App 550, 555; 847 NW2d 679 (2014) (quotation marks and citations omitted).]

Stated differently, “[s]ubstantial evidence is that which a rea sonable mind would accept as adequate to support a decision, b eing more than a mere scintill a, but less than a preponderance of
the evidence.” Petrelius v Houghton-Portage Twp Sch , 281 Mich App 520, 521; 761 NW2d 395 (2008) (quotation marks and citation omitted).

Additionally, we “review questi ons of statutory interpretation de novo. The primary goal when interpreting a statute is to ascertain and give effect to the Legislature’s intent.” Logan , 304 Mich App at 555 (citations omitted). “If the statutory languag e is unambiguous, appellate courts presume that the Legislature intended the plainly expressed mea ning, and further judicial construction is neither required nor permitted.” Petrelius , 281 Mich App at 522. This Court has recognized that the MESA “generally is to be liberally construe d, [but] those provisions regarding disqualific ation from benefits are to be construed na rrowly.” Korzowski v Pollack
Indus , 213 Mich App 223, 229; 539 NW2d 741 (1995).

III. APPLICABLE LAW

Pursuant to MCL 421.29(1)(b), a n individual is disqualified fr om receiving benefits under the MESA if he or she “[w]as suspended or discharged for misconduct connected with the
individual’s work or for intoxi cation while at work.” “Miscond uct” is not statut orily defined, but the Michigan Supreme Court adopted the following definition of “misconduct” for purposes of MCL 421.29(1)(b):-4- [“Misconduct”] is limited to condu ct evincing such willful or w anton disregard of an employer’s interests as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expec t of his employee, or in carelessness or negligence of such degree or recurrence a s to manifest equal culpability, wrongful intent or evil design, or to show an inte ntional and substantial disregard of the employer’s interests or of the emp loyee’s duties and obligations to his employer. On the other hand mere inefficien cy, unsatisfactory conduct, failure in good performa nce as the result of inability or incapacity, inadvertencies or ordinary negligence in isolated instances, or good faith errors in judgment or discretion are not to be deemed [“]misconduct[”] wi thin the meaning of the statute.” [ Carter v Mich Employment Security Comm , 364 Mich 538, 541; 111 NW2d 817 (1961) (quotation mar ks and citation omitted).]

“[W]rongdoings which may justify termination of employment unde r a[n employment] contract do not necessarily qualify as ‘mi sconduct’ for purposes of the [MESA].” Hagenbuch v Plainwell Paper Co, Inc , 153 Mich App 834, 837-838; 396 NW2d 556 (1986). Similarly, s ome actions may constitute statutory “misc onduct” even if they do not justi fy termination under the terms of a particular employment contract. Id . at 838. As such, a claimant’s behavior must be assessed objectively, independent from th e requirements of his or her em ployment contract. Id

.

“It is well established that excess absenteeism and tardiness for reasons not beyond the employee’s control constitutes misconduct under MCL 421.29(1)(b )[.]” Id . at 837; see also Washington v Amway Grand Plaza , 135 Mich App 652, 658; 354 NW2d 299 (1984) (“An employee’s failure to report to work on time may in certain cir cumstances constitute statutory misconduct.”). However,

applying the Carter , [364 Mich at 541], definition to the facts of this case, claimant’s tardiness or absences cannot support a finding of st atutory misconduct unless it is determined that they were without good cause, whic h could include personal reasons or other reasons beyond claimant’s control. As a matter of law, tardiness or absences resulting from events beyond the employee’s control or which are otherwise with good cause cannot be considered conduct in wilful or wanton disregard of the employer’s interests. Carter

, supra . This interpretation
is consistent with the Court’s du ty to narrowly construe the di squalification provisions of the act so as to fu rther the remedial policy of t he act, which is, in part, to provide benefits to persons unemployed through no faul t of their own. [ Washington , 135 Mich App at 658 (emphasis added).]

In general, “the employer bears the burden of proving [statuto ry] misconduct,”
Korzowski , 213 Mich App at 229; see also Washington , 135 Mich App at 658, but the burden shifts when “the relevant facts are entirely in the hands of th e former employee and, for all practical purposes, cannot be discovered by the employer,” Veterans Thrift Stores, Inc v Krause

, 146 Mich App 366, 368; 379 NW2d 495 (1985). “[O]nce the employ er raises the issue of disqualification for misconduct under [MCL 421.]29(1)(b) and su bmits evidence of a number of absences which, if unsupported by sufficient reasons, are so ex cessive as to constitute misconduct within the contemplation of this section, then the b urden is upon the claimant to provide a legitimate explanation for the absences.” Id

.-5- IV. APPLICATION

The question here is whether claimant’s absences constituted a basis for a finding of statutory misconduct, disqualifyi ng her from receiving unemploy ment benefits. There is no dispute that she violated res pondent’s no-fault attendance poli cy and that the violation was the basis for her termination. But, respondent stipulated at the h earing that the reason for claimant’s absences was her illness. Thus, the relevant inquiry is whethe r respondent discharged claimant
for “misconduct” as that ter m is construed under MCL 421.29(1)( b).

The ALJ found that claimant’s actions displayed willful disreg ard of her employer’s interest and, therefore, constituted misconduct because her att endance “left much to be desired,” claimant had received warnings r elated to her attendance issues , and she did not advise her employer or submit medical evidence in support of her claim tha t her last absence was due to a medical condition. The MCAC and the circuit court concluded, a nd we agree, based on the record, that these factual findi ngs are not clearly erroneous. The record demonstrates that claimant was absent from work or left early from work on multip le occasions. The record also
indicates that she received disci plinary write-ups based on her attendance issues. Finally, although claimant testified at the hearing that she told her AC S supervisor, at the time that she was being discharged, that she was absent on February 28, 2013, because she was not feeling well and could not see, the record supports the ALJ’s finding t hat claimant failed to expressly advise her employer, or provide medical documentation specifica lly indicating, that her last
absence was due to a medical condition. 3

However, even if we assume, without deciding, that the ALJ did not accept the parties’ stipulation that all of claimant’s absences were due to a medic al condition, there is nothing in the record contradicting the evidence proffered by claimant that at least two of her absences, i.e., those occurring on February 18, 2013, and February 28, 2013 (th e absence that precipitated her discharge), were due to illness or a medical condition. Likewise, the ALJ did not state any factual findings that discredited claimant’s explanation for he r attendance issues. Nevertheless, the ALJ concluded that respondent’s failure to advise her emplo yer of the reason for her last absence or submit medical evidence following her last absence, in conjunction with her repeated absences and warnings, constitu ted statutory misconduct. Simil arly, in affirming the ALJ’s decision, the circuit court focu sed on the fact that claimant d id not provide an explanation for her absences when she was discharged and the fact that claimant did not submit documentation from her doctor concerning her absences until shortly prior to the h earing before the ALJ, reasoning that the ALJ was permitted to consider the explanation offered by claimant at the hearing and the content and timing of the doctor’s letter in assessing claimant ’s credibility. Accordingly, even if the ALJ and the circuit court arguably “stated doubt regarding [claimant’s] explanation for her

3 We conclude that the ALJ’s factual findings were based on subs tantial evidence because claimant did not identify a part icular medical condition in her conversation with her supervisor
when she was terminated. See Petrelius , 281 Mich App at 521 (“Substantial evidence is that
which a reasonable mi nd would accept as ade quate to support a d ecision, being more than a mere scintilla, but less than a preponde rance of the evidence.”).-6- absences,” as respondent contends on appeal, it is evident that neither tribunal made factual findings contrary to claimant’s explanation for her absences or specifically found that claimant’s explanation was not credible.

As such, it is apparent that the ALJ, the MCAC, and the circui t court failed to recognize that absences for good cause do not constitute “misconduct” for purposes of MCL 421.29(1)(b), even if those absences violate the terms of a claimant’s employ ment under a no-fault attendance policy. See Hagenbuch , 153 Mich App at 837-838; Washington , 135 Mich App at 658. MCL 421.29(1)(b) provides for a disqualification from unemployment benefits if an individual was “discharged for misconduct connected with the indi vidual’s work.” (Emphasis a dded.) Thus, under the plain language of the statute, a disqualification for misconduct can only arise from the conduct that served as the basis of an employee’s discharge. S ee Petrelius , 281 Mich App at 522. Allowing an individual to be disqualified from unemployme nt benefits on the basis of conduct that should not impact his or her disqualification cont radicts the principle, based on the remedial nature of the MESA, tha t “provisions regarding disqual ification from benefits are to be construed narrowly.” Korzowski , 213 Mich App at 229.

Here, failing to notify ACS that her final absence was due to a medical condition was not the basis of claimant’s discharge. Instead, claimant was disch arged because she accumulated
excessive absences in violation of ACS’s no-fault attendance po licy, regardless of the reasons for her absences; a senior employee relations specialist for ACS ex pressly confirmed that the reasons for claimant’s absences did not matter, and that claima nt would have been terminated despite any explanation that she provided for her absences. Th us, the only acts properly considered in determining whether claimant committed statutory misconduct for purposes of MCL 421.29(1)(b) are claimant’s absences themselves, not whethe r claimant advised her employer of the reasons for her absences or provided medical do cumentation to her employer concerning those absences.

The record shows that claimant pr ovided a “legitimate explanati on” for at leas t two of her absences at the hearing before the ALJ, see Veterans Thrift Stores , 146 Mich App at 368, which was supported by her testimony at the ALJ hearing, the ACS writ e-ups included in the record and referenced during the senior employee relations specialist’ s testimony, and the certification to return to work or school prepared by claimant’s doctor conce rning claimant’s February 18,
2013 absence. 4 In addition to specifically no ting that claimant was under he r doctor’s care on February 18, 2013, the certification provided evidence that cla imant had one or more chronic medical conditions related to her thyroid:

Limitations/Remarks: DX: Toxic Diffuse Goiter and Anxiety diso rder. This patient was taken care of by us with a follow up appointment fr om an ER visit in February. She has a history of Grave’s Disease, which can caus e numerous fatigue symptoms which may cause her to go to the hospital on o ccasion. She
was able to continue work with no restrictions at this time whe n released from our

4 We recognize that the certificat ion was prepared several month s after claimant’s last two
absences.-7- office; however, she has had the same symptoms also in March 20 13, which can be caused by her anxiety and her thyroid issues. Aisha’s sympt oms are heart palpitations, some blurred vision, headaches, and severe dry mo uth. Please assist.

It is also apparent from the hearing transcript that claimant d id not provide additional testimony regarding the medical reasons for her absences in light of the ALJ’s response, i.e., “[W]hy do we need to go into detail?,” after the parties offered to stipulat e that claimant’s medical condition
was the reason for her absences.

Except for providing evidence that respondent left early on Nov ember 29, 2012, due to a family emergency, respondent did not contradict the medically-r elated reasons provided by claimant for her absences. Likewise, none of the lower tribuna ls stated factual findings that contradicted the reasons provided by claimant or concluded that claimant’s absences were without good cause. Instead, the lower tribunals focused on cl aimant’s lack of attendance, the fact that claimant received warnings regarding her attendance, and the fact that claimant did not provide an explanation or proffer documentation for her absence s until after she was terminated. However, these facts do not establish, on their own, that claim ant’s absences constituted statutory misconduct. Again, a “claimant’s tardiness or absenc es cannot support a finding of statutory misconduct unless it is determin ed that they were without good cause , which could include personal reasons or othe r reasons beyond claimant’s con trol.” Washington , 135 Mich App at 658 (emphasis added). Accordingly, because the lower tr ibunals did not determine that claimant’s absences were without good cause, the ALJ, the MCAC, and the circuit court erred in concluding that claimant’s absences constituted statutory misco nduct that justified a disqualification from unemployment benefits under MCL 421.29(1) (b). Hodge , 497 Mich at 193-194; Logan , 304 Mich App at 554-555.

V. CONCLUSION

The lower tribunals did not determine whether claimant’s absenc es were without good cause in light of her alleged i llness or medical condition. Ac cordingly, without such a factual determination, claimant was wrongfully disqualified from receiv ing unemployment benefits under MCL 421.29(1)(b).

Reversed and remanded for further proceedings consistent with t his opinion. We do not retain jurisdiction.

/s/ Kathleen Jansen /s/ William B. Murphy
/s/ Michael J. Riordan