Court Opinion

ID: 4088643
Source: CourtListenerOpinion
Date Created: 2016-10-11 22:08:38.281443+00
Date Added: 2024-06-11T14:33:44.487998
License: Public Domain

JUSTICE – MALL, LLC,                            )
                                                )
        Employer-Appellant,                     )
                                                )
v.                                              )       No. SD34250
                                                )
JAMIE BOLAND,                                   )       Filed: Oct. 11, 2016
                                                )
        Employee-Respondent,                    )
                                                )
and                                             )
                                                )
DIVISION OF EMPLOYMENT                          )
SECURITY,                                       )
                                                )
        Respondent.                             )

                            APPEAL FROM THE LABOR AND
                         INDUSTRIAL RELATIONS COMMISSION

REVERSED AND REMANDED WITH INSTRUCTIONS

        Justice – Mall, LLC (“Employer”) appeals the decision of the Labor and Industrial

Relations Commission (“the Commission”) that Jamie Boland (“Employee”) was not

disqualified from receiving unemployment compensation benefits as a result of being

discharged for misconduct. See sections 288.030.1(23) and 288.050.2.1 In a single point

1
 RSMo Non-cum. Supp. 2014. Section 288.030.1(23) defines “[m]isconduct” for purposes of unemployment
compensation as:

                                                    1
relied on, Employer contends “the Commission acted without or in excess of its powers

under [section] 288.210, in that the Appeals Tribunal did not provide Employer a reasonable

opportunity for a fair hearing before rendering its decision when the Appeals Tribunal

refused to allow Employer to call rebuttal witnesses to contradict and impeach [Employee]’s

testimony.” Finding merit in this claim, we reverse the order of the Commission and

remand the matter to allow Employer to present its excluded rebuttal witnesses.

                     Applicable Principles of Review and Governing Law

        We review this matter to determine whether the Commission “acted without or in

excess of its powers[.]”2 Section 288.210(1).3

        [C]onduct or failure to act in a manner that is connected with work, regardless of whether
        such conduct or failure to act occurs at the workplace or during work hours, which shall
        include:

        (a) Conduct or a failure to act demonstrating knowing disregard of the employer’s
            interest or a knowing violation of the standards which the employer expects of his or
            her employee;

        (b) Conduct or a failure to act demonstrating carelessness or negligence in such degree or
            recurrence as to manifest culpability, wrongful intent, or a knowing disregard of the
            employer’s interest or of the employee’s duties and obligations to the employer;

        (c) A violation of an employer’s no-call, no-show policy; chronic absenteeism or
            tardiness in violation of a known policy of the employer; or two or more unapproved
            absences following a written reprimand or warning relating to an unapproved absence
            unless such absences are protected by law;

        (d) A knowing violation of a state standard or regulation by an employee of an employer
            licensed or certified by the state, which would cause the employer to be sanctioned or
            have its license or certification suspended or revoked; or

        (e) A violation of an employer’s rule, unless the employee can demonstrate that:

           a. He or she did not know, and could not reasonably know, of the rule’s requirements;

           b. The rule is not lawful; or

           c. The rule is not fairly or consistently enforced[.]
2
  When, as here, the Commission adopts findings of the Appeals Tribunal, we also review those findings. See
Hubbell Mech. Supp. Co. v. Lindley, 351 S.W.3d 799, 807 (Mo. App. S.D. 2011).
3
  RSMo 2000.

                                                        2
       In an administrative proceeding, due process is provided by affording parties
       the opportunity to be heard in a meaningful manner. The parties must have
       knowledge of the claims of his or her opponent, have a full opportunity to be
       heard, and to defend, enforce and protect his or her rights.

Weinbaum v. Chick, 223 S.W.3d 911, 913 (Mo. App. S.D. 2007) (citation and quotation

omitted). The Commission exceeds its authority when it affirms an Appeals Tribunal

determination based upon a record that reveals a party “was not provided a reasonable

opportunity for a fair hearing[.]” Id. at 914.

       Section 288.190.2 requires the Appeals Tribunal to conduct hearings “in accordance

with regulations prescribed by the division for determining the rights of the parties[.]”

Those regulations provide “each party . . . the right to call and examine witnesses, . . . to

impeach any witness, . . . and to rebut the evidence against him/her[.]” Title 8 C.S.R. 10-

5.015(10)(B)(2). “Evidence is admissible if it is not irrelevant, immaterial, privileged or

unduly repetitious[,]” 8 C.S.R. 10-5.015(10)(B)(4), and disallowing relevant testimony may

constitute the denial of a fair hearing. Cf. Weinbaum, 223 S.W.3d at 914 (disallowing

testimony of proposed witness who had been suggested by another witness to possess

relevant information denied the proponent “a full opportunity to be heard on the matter”).

       The employer bears the burden to prove misconduct by a preponderance of the

evidence. Wooden v. Div. of Emp’t Sec., 364 S.W.3d 750, 753 (Mo. App. W.D. 2012).

Whether particular conduct constitutes misconduct is a question of law on which we owe no

deference to the Commission. Id.

                                                 3
                                      The Evidentiary Hearing4

        Because the second deputy involved in Employee’s claim had found in favor of

Employer on the issue of misconduct, Employer presented its evidence first. Included in a

“packet of documents” provided to the parties by the Division of Employment Security (“the

Division”) and admitted into evidence was a list of behaviors submitted by Employer

alleging, among other things, that Employee “[p]ermitted harassment of co-workers[.]” It

also included this statement made by Employee to the initial deputy: “Co-workers may have

called [another worker wearing a neck brace] crippled. I’m not sure. Nothing was

mentioned to me about professionalism.” Employer’s evidence included exhibits and

testimony by an operations manager, Keith Clavin, and Anntionette Veal, a coworker

managed by Employee. Employer’s counsel informed the Appeals Tribunal at the outset of

the hearing that Employer would have “no other witnesses[.]”

        Mr. Clavin testified that, through a series of promotions, Employee had become an

assistant store manager and then a store manager on a probationary basis in July or August

2013. In February 2014, Employee signed a document (“the receipt”) that acknowledged

she had received “the Company’s Employee Handbook” (“the handbook”). The receipt also

stated that Employee understood that she was expected to read the handbook and that the

policies in it applied to her. The receipt and the handbook were admitted into evidence.

        Mr. Clavin testified that Employee was discharged on April 7, 2015 by an “overall

store manager[,]” Kathy Cootwood. A form entitled “NOTICE OF SEPARATION” was

admitted into evidence at the hearing, and Mr. Clavin testified that this form (“the discharge

4
  Employer protested Employee’s claim for unemployment compensation, and a deputy initially determined
that Employee was not disqualified for receiving benefits based on Employer’s claim of misconduct. A
different deputy reconsidered that decision and determined that Employee was disqualified for benefits due to
misconduct connected with her work. It was Employee’s appeal of that decision that led to the evidentiary
hearing before the Appeals Tribunal.

                                                      4
form”) was signed by both Ms. Cootwood and Employee. The discharge form included the

circled word, “Termination[,]” along with the designation “Eligible for Rehire: Yes No”

with the “No” circled. The discharge form had an area titled: “Reason for Separation

(include specific details)[.]” On the blank lines provided thereafter, the single word

“Performance” was handwritten.

       Employee, who appeared pro se, provided testimony in response to questions posed

by the Appeals Tribunal referee, and she offered two exhibits that were received into

evidence. Employee then provided the following testimony when cross-examined by

Employer’s counsel. Employee said that she “never violated any company policies[,]” and

“whatever [she] did was to the . . . best of [her] personal ability[.]” Employee’s recollection

was that she was told her services were no longer needed because Employer had restructured

its operations. Employee recalled signing the discharge form, but she stated that when she

signed the form it did not indicate that she was being terminated because of performance

issues, and it was not marked to indicate that she was ineligible for rehiring.

       Just prior to stating that he had completed his cross-examination of Employee,

Employer’s counsel stated that he would be calling Ms. Cootwood and Laura Williamson as

witnesses to testify (by telephone) about how the discharge form appeared at the time it was

signed by Employee. The referee observed that Employer had not identified either woman

as a witness at the beginning of the hearing. Employer’s counsel replied that he did not

know that Employee was going to testify inconsistently with the discharge form, and his

additional witnesses would impeach Employee’s testimony by testifying that the discharge

form “was completely filled out refuting [Employee’s] testimony[.]” The referee ruled that

                                               5
Employer’s additional witnesses would not be allowed to testify because Employer had not

followed the proper procedure of announcing them when the hearing began.

       At the conclusion of Employee’s presentation of evidence, Employer’s counsel

announced Ms. Williamson and Ms. Cootwood as witnesses to testify “by telephone” right

then “to refute the testimony of [Employee] with respect to [the discharge form] and what

was completed or not completed when she signed it[.]” Employer’s counsel made an offer

of proof as to what he expected that testimony to be, but the referee again refused to hear

their testimony.

       In its subsequent decision against Employer, the Appeals Tribunal found that

“[s]ince there was conflicting evidence presented, the issue of credibility is before the

[Appeals] Tribunal.” It then found “that [Employee’s] testimony is more credible than the

testimony of [E]mployer’s witnesses.” The decision explained details of the evidence that

led the Appeals Tribunal to find Employee “persuasive[,]” and it concluded:

               On the whole record the competent and substantial evidence shows
       that [Employee] was discharged due to restructuring. Employer did show
       that [Employee] had some performance issues, but [E]mployer did not prove
       that [Employee] was discharged for performance. Even if [E]mployer had
       discharged her for performance, the issues presented did not rise to a policy
       violation or to insubordination.

Employer appealed the decision of the Appeals Tribunal to the Commission.

       The Commission adopted and incorporated those portions of the Appeals Tribunal’s

decision “not inconsistent with” its decision that Employee had not been discharged for

misconduct. Specifically, the Commission agreed with the Appeals Tribunal’s finding that

Employee’s “testimony was more credible than that of [E]mployer’s witnesses.” In doing

so, however, the Commission explicitly found that “the referee erred by not allowing

[E]mployer to call Ms. Coopwood [sic] to rebut [Employee’s] unexpected testimony that the

                                               6
[discharge form] she signed did not indicate the reason was for ‘performance’ and did not

indicate she was not eligible for rehire.” Despite that finding of error, the Commission

“ultimately agree[d] with the result reached by the Appeals Tribunal” because it was “unable

to discern evidence of anything more than possible poor job performance, the same reason

cited by [E]mployer in the [discharge form] entered into evidence.”

                                          Analysis

       Employer contends it was denied “a reasonable opportunity for a fair hearing” when

the Appeals Tribunal refused to hear testimony from “rebuttal witnesses to contradict and

impeach [Employee’s] testimony” and the ruling “was extremely prejudicial because

credibility was a central issue in this matter.” Employer maintains that testimony from its

“proposed rebuttal witnesses would have provided additional factual evidence regarding the

content of the [discharge form] as well as contradicting and impeaching [Employee’s]

testimony” such that it “could have altered the credibility determinations made by both the

Appeals Tribunal and the Commission.”

       Even though “[t]he regulations give the referee considerable discretion in examining

witnesses and controlling the procedures to be used during the hearing[,]” Miller v. Bank of

the West, 264 S.W.3d 673, 678 (Mo. App. W.D. 2008), and the technical rules of evidence

do not apply, fundamental principles of evidence are nonetheless applicable in

administrative hearings. See Stone v. Mo. Dept. of Health & Senior Servs., 350 S.W.3d 14,

21 (Mo. banc 2011). In the trial context, “[i]t is established law that ‘[a]ny competent

testimony that tends to explain, counteract, repel or disprove evidence offered by [one party]

may be offered in rebuttal.’” Howard v. City of Kansas City, 332 S.W.3d 772, 785 (Mo.

banc 2011) (quoting State v. Gardner, 8 S.W.3d 66, 72 (Mo. banc 1999)). “Rebuttal

                                              7
evidence is evidence that attempts to ‘disprove or contradict’ the evidence to which it is

contrasted.” Id. at 785 n.14. “As a general proposition, the credibility of witnesses is

always a relevant issue in a lawsuit.” Mitchell v. Kardesch, 313 S.W.3d 667, 675 (Mo. banc

2010) (quotation omitted). The regulation governing unemployment compensation hearings

underscores the principles of impeachment and rebuttal by specifically permitting a party to

“impeach any witness” and “rebut the evidence against” the party. 8 C.S.R. 10-

5.015(10)(B)(2). Generally, “[t]he exclusion of proper evidence is presumed prejudicial

unless otherwise shown.” Aliff v. Cody, 26 S.W.3d 309, 321 (Mo. App. W.D. 2000).

        The Division conceded at oral argument that the Appeals Tribunal erred in denying

Employer the opportunity for rebuttal, but it argues that the error “is immaterial” because the

discharge form simply documented poor job performance. In its brief, the Division argued

that there was no indication that the proposed witnesses “would have provided evidence that

[Employee] was discharged for misconduct[.]”

        The Division’s position is flawed because it fails to account for the fact that poor job

performance is not necessarily excluded as a source of misconduct.5 The question is

whether the employee acted or failed to act in a statutorily-defined manner in connection

with her work so as to commit misconduct. See sections 288.030.1(23) and 288.050.2.

Conduct that is generally labeled by an employer as poor job performance in a particular

case may constitute, for example, an employee’s “knowing violation of the standards which

the employer expects of his or her employee”; “a knowing disregard of the employer’s

interest”; or a violation of an employer’s rule when the employee does not demonstrate:

5
  In contending “that poor work performance is generally not misconduct[,]” the Commission relies on Hoover
v. Cmty. Blood Ctr., 153 S.W.3d 9, 14 (Mo. App. W.D. 2005). However, the statutory definition of
misconduct was significantly amended after the decision in Hoover was issued and before Employee was fired.
See L.2014, S.B. No. 510, § A, eff. Aug. 28, 2014.

                                                    8
           a. He or she did not know, and could not reasonably know, of the rule’s

             requirements;

           b. The rule is not lawful; or

           c. The rule is not fairly or consistently enforced[.]

Section 288.030.1(23)(a), (b), and (e). In any event, no such determination is necessary here

because Employer correctly asserts that the Commission acted without or in excess of its

powers by issuing its decision before considering Employer’s relevant rebuttal evidence.

           Employer’s point is granted, the order of the Commission is reversed, and the case is

remanded to allow Employer’s witnesses Cootwood and Williamson the opportunity to

testify.

DON E. BURRELL, J. – OPINION AUTHOR

JEFFREY W. BATES, P.J. – CONCURS

MARY W. SHEFFIELD, C.J. – CONCURS

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