Court Opinion

ID: 1064188
Source: CourtListenerOpinion
Date Created: 2013-10-09 19:16:41.560379+00
Date Added: 2024-06-11T10:50:20.134317
License: Public Domain

COURT OF APPEALS OF VIRGINIA

Present: Judges Benton, Annunziata and Senior Judge Coleman
Argued at Richmond, Virginia

THOMAS EDDIE TATUM
                                                 OPINION BY
v.   Record No. 2436-02-2                 JUDGE SAM W. COLEMAN III
                                                JUNE 24, 2003
VIRGINIA DEPARTMENT OF AGRICULTURE
 AND CONSUMER SERVICES

          FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND
                   Melvin R. Hughes, Jr., Judge

          James A. Eichner (William G. Shields &
          Associates, on brief), for appellant.

          Guy W. Horsley, Jr., Senior Assistant
          Attorney General (Jerry W. Kilgore, Attorney
          General; Elizabeth A. McClanahan, Chief
          Deputy Attorney General; Judith Williams
          Jagdmann, Deputy Attorney General; Martha M.
          Parrish, Assistant Attorney General, on
          brief), for appellee.

     Thomas Eddie Tatum was employed by the Virginia Department

of Agriculture and Consumer Services (the "Department") of the

Commonwealth as an inspector, primarily inspecting gasoline

pumps for proper calibration.    The Department issued a Group III

written notice of disciplinary action against Tatum for

misconduct and removed Tatum from his job.

     Pursuant to the State Grievance Procedure, Code § 2.2-3004,

Tatum requested and received a grievance hearing before an

administrative hearing officer.    The hearing officer made

findings of fact and reduced the Department's disciplinary
action to a Group III written notice without removal, ordering

reinstatement but not back pay.    The Department requested the

hearing officer to reconsider his decision and also requested

administrative review of the hearing officer's decision.   The

hearing officer denied the request for reconsideration.    On

administrative review, the Director of the Department of

Employment Dispute Resolution and the Director of the Department

of Human Resources Management upheld the hearing officer's

decision.

     Pursuant to Code § 2.2-3006(B), the Department sought

judicial review of the hearing officer's decision in the Circuit

Court of the City of Richmond.    The circuit court reversed the

hearing officer's decision which had reinstated Tatum and upheld

the Department's Group III written notice and removal of Tatum

from his job.

     Tatum appealed that decision to this Court, contending that

the circuit court erred in reversing and vacating the hearing

officer's decision reinstating him to his job.   For the

following reasons, we reverse the circuit court's decision and

reinstate the hearing officer's decision.

                              BACKGROUND

     The Department employed Tatum for nine years as an

inspector, primarily inspecting gasoline pumps to ensure they

were accurately calibrated.    He worked independently, with

little supervision.   According to the Department's program
                                 - 2 -
manager, all inspectors are "vested with police powers in the

weights and measures law.    [Therefore,], [i]t's important that

we're able to rely on their judgment, rely on their honesty,

[and] credibility, . . . from the standpoint of there's not

someone looking over their shoulder each hour of the day."

     During the fall of 2000, Tatum accepted outside employment

during his off-hours for F.W. Baird, a company regulated by the

Department, and he performed work similar to that which he

performed for the Department.   When the Department learned of

Tatum's outside employment, it investigated the situation and

determined that Tatum's activity constituted a prohibited

conflict of interest.   It issued a Group II written notice to

Tatum for that misconduct.   Tatum did not grieve that

disciplinary action.

     As part of Tatum's job, he was required to complete three

written documents to account for his time:   a Leave Activity

Reporting Form, a Timesheet, and an internal work report.    On

November 22, 2000, Tatum submitted those documents and claimed

that his absences from work on November 20 and 21, 2000 were due

to personal sick leave.   In fact, Tatum was not sick on those

dates, rather, he was working in another state in his outside

employment for F.W. Baird.

     As a result of Tatum's falsifying his leave report and

timesheet records, the Department issued Tatum a Group III

written notice with removal from his job on September 10, 2001.
                                - 3 -
State personnel policy describes Group III offenses as of such a

serious nature that the normal disciplinary action for a Group

III offense is termination of employment.    See Department of

Personnel and Training Policies and Procedures Manual, Standards

of Conduct, Policy No. 1.60, § VII, D.3.a.    In the Group III

written notice, the Department stated that prior to issuing this

decision it had taken into consideration Tatum's nine year

tenure and his job performance.   The Department explained that

"due to the regulatory responsibilities of [Tatum's] position,

the Department and the public must be able to rely on the

accuracy and truthfulness of documents produced by individuals

occupying a position of public trust."   As a result of Tatum's

falsification of his employment records and leave reports, the

Department concluded that Tatum was no longer a trusted employee

and that removal was the appropriate sanction.

     Tatum requested a grievance hearing before an

administrative hearing officer pursuant to Code § 2.2-3004.      At

the grievance hearing, Tatum asserted that he had "mistakenly"

entered personal sick leave on the documents because the

document contained no code for "family and personal leave."      At

the time Tatum completed the documents, he had accrued

sufficient family and personal leave to cover the absence.

     The hearing officer rejected Tatum's contention that he had

"mistakenly" reported his November 20 and 21 absences as sick

leave because he had previously completed leave documents using

                              - 4 -
the correct code for family and personal leave.   The hearing

officer also considered mitigating circumstances in deciding

whether to reduce the Department's disciplinary action against

Tatum to a sanction less severe than termination. 1   The hearing

officer found that Tatum's "favorable work performance and

approximately nine years of employment with the Commonwealth

form[ed] a sufficient basis to reduce [Tatum's] discipline from

a Group III written notice with removal to a Group III written

notice without removal."   The hearing officer declined to award

Tatum back pay because he upheld the Group III written notice

and because Tatum had also received a Group II written notice.

The hearing officer ordered the Department to reinstate Tatum to

his job.   The hearing officer rejected the Department's argument

that because Tatum had failed to fully cooperate with its

investigation he had aggravated the situation and prohibited

mitigation of the discipline against him.   The hearing officer

     1
       In the Personnel Manual, Group III offenses include
"[f]alsifying any records, including, but not limited to,
vouchers, reports, insurance claims, time records, leave
records, or other official state documents." Policy No. 1.60,
§ V, B.3.b. P&PM, the Personnel Manual, provides that the
normal disciplinary action for a Group III offense is the
issuance of a Written Notice and discharge, Policy No. 1.60,
§ VII, D.3.a. but also provides that agencies may reduce
disciplinary action based on mitigating circumstances such as:
"conditions that would compel a reduction in the disciplinary
action to promote the interests of fairness and objectivity; or
. . . an employee's long service or otherwise satisfactory work
performance." Policy No. 1.60, § VII, C.1. It further provides
that as alternatives to discharge, "[m]itigating circumstances
may result in an employee's demotion, transfer and/or suspension
. . . ." P&PM, Policy No. 1.60, VII, C.2.a.
                               - 5 -
ruled that he was required to consider the aggravating

circumstances existing at the time of the events giving rise to

the disciplinary action and that Tatum's behavior subsequent to

those events could not serve as aggravating circumstances.

     The hearing officer denied the Department's request for

reconsideration.    The hearing officer ruled that because a

grievance hearing is de novo the hearing officer decides the

dispute on an independent review of the evidence as if the

Department had made no disciplinary determination.   The hearing

officer rejected the Department's argument that because the

Personnel Manual states that "agencies may reduce the

disciplinary action if there are mitigating circumstances,"

Policy No. 1.60, § VII, C., a hearing officer has no authority

to mitigate discipline.   In so ruling, the hearing officer held

that the Department's authority to consider mitigating

circumstances is not exclusive and a de novo hearing necessarily

requires an independent review of the facts and application of

legal principles.   The hearing officer noted that he was

required to determine whether the Department presented

sufficient evidence to support the level of disciplinary action

taken, and if so, whether sufficient mitigating circumstances

existed to justify a reduction in the disciplinary action.

     The hearing officer also ruled that "aggravating

circumstances would normally be considered when determining

whether fairness requires a reduction of discipline."    However,
                                - 6 -
he further ruled that determining whether "[a]ggravating

circumstances [exist] must be construed narrowly because their

consideration arises only in the context of mitigation."    The

hearing officer specifically rejected the Department's argument

that Tatum's failure to cooperate with its investigation of his

conduct was an aggravating circumstance.   The hearing officer

found that "[n]o evidence was presented suggesting [Tatum] had a

duty to cooperate with the [Department's] investigation."    The

hearing officer found that, to the extent that Tatum had any

such duty, his refusal to cooperate was reasonable under the

circumstances.    The hearing officer also found that Tatum's

separate Group II written notice relating to a conflict of

interest concerning his outside employment could not serve as an

aggravating circumstance in considering Tatum's Group III

written notice.   The hearing officer ruled that the Group II

written notice was only relevant with respect to the

accumulation of discipline.   Thus, "the [h]earing [o]fficer

[gave] less weight to the Group II Written Notice that [Tatum]

failed to appeal than the [h]earing [o]fficer would otherwise

have given had [Tatum] had a pattern of disciplinary action."

     The hearing officer concluded as follows:

               The [Department] argues that it can no
          longer trust [Tatum] to do his job because
          he falsified leave. No evidence was
          presented suggesting [Tatum] ever falsified
          any of his inspection duties or records.
          Indeed, the evidence showed that [Tatum] was
          very good at his job and took it seriously.
                                - 7 -
            While it may be factually true that the
            [Department's] Party Designee no longer
            trusts [Tatum's] work product, no evidence
            was presented suggesting that his conclusion
            was reasonable or appropriate. The
            [Department's] assumption that one act of
            falsification forever condemns [Tatum's]
            entire work product is inappropriate.

                 After giving due consideration to the
            [Department's] judgment, the Hearing Officer
            finds that its judgment was in error. The
            [Department] based its decision to terminate
            . . . on its false conclusion that it could
            no longer trust [Tatum] to perform his
            inspection duties. Consequently, the
            [Department's] decision to terminate was
            inappropriate.

     The Department requested administrative review of the

hearing officer's decision by the Director of the Department of

Employment Dispute Resolution and by the Director of the

Department of Human Resources Management.   The Director of the

Department of Employment Dispute Resolution found that the

hearing officer did not abuse his discretion or exceed his

authority under either the State Grievance Procedure or the

Hearing Officer Rules.   He ruled that the hearing officer was
entirely within his authority to give the Group II written notice

less weight than the Department may have given it in determining

whether to uphold or reverse Tatum's termination.   The Director

of the Department of Human Resources Management found the hearing

officer did not violate the Personnel Policy No. 1.60 in his

application of the provisions of that policy and, therefore, she

had no basis upon which to interfere with the hearing officer's

decision.   These decisions, which were rendered on administrative

review to determine whether the hearing officer's decision is

                                - 8 -
consistent with state or agency policy and whether it complies

with the grievance procedure, are final and not appealable.      See

Department of Employment Dispute Resolution, Grievance Procedure

Manual, § 7.2(c); see also Code §§ 2.2-1001(5) and 2.2-3003(G).

Code § 2.2-3003(A) requires the DEDR to develop a three-tiered

grievance procedure for state employees, which includes a formal

hearing.

     Pursuant to Code § 2.2-3006(B), the Department appealed the

hearing officer's decision to the circuit court.   Code

§ 2.2-3006(B) provides in pertinent part that "[w]ithin thirty

days of a final decision, a party may appeal on the grounds that

the determination is contradictory to law . . . ." (Emphasis
added).    The circuit court hears the appeal "on the record," and

may reverse, affirm, or modify the hearing officer's decision.

Code § 2.2-3006(B).

     The Department argued before the circuit court that the

hearing officer's decision to mitigate the disciplinary action

and order Tatum's reinstatement was without authority and

contrary to the law, because it "ignor[ed] the express legal

directive of Code § 2.2-3004(B) that [the Department], not the

Hearing Officer, has the exclusive right to manage its

employees."   The Department also argued that the hearing officer

ignored aggravating circumstances based on the fact that Tatum

failed to cooperate with the Department's investigation of his

misconduct regarding the outside employment.   The Department

contended that "[h]ad the Hearing Officer found that the evidence

did not support falsification of the time sheets, then he would

have had the authority to reinstate."   The Department further
                                - 9 -
argued that the hearing officer failed to recognize that it had

considered mitigating circumstances, including Tatum's tenure and

past work performance when it determined what sanction to impose,

but had determined that such mitigating factors were outweighed

by aggravating circumstances, including Tatum's failure to

cooperate with the investigation, and his outside employment

which resulted in a Group II written notice.   In addition, the

Department argued that the hearing officer erred in refusing to

consider the Group II written notice as an aggravating

circumstance because it arose out of the same general facts as

the Group III written notice.    The Department asserted that

"[t]he Hearing Officer has substituted his judgment for that of

the [Department], by reinstating an employee who has breached his

trust with his superiors to a position with – quasi-law

enforcement and regulatory powers."
     The circuit court reversed the hearing officer's decision

which ordered Tatum's reinstatement, finding that the decision

was contrary to law.   In so deciding, the circuit court ruled as

follows:

           [I]n his written decision, the hearing
           officer, while finding that Tatum
           intentionally falsified the leave forms,
           observed that there was no evidence of
           falsifying inspection records and found that
           "one act of falsification" in light of an
           otherwise uneventful, discipline free course
           of employment for nine years was not
           justification for the agency to no longer
           trust Tatum to carry out his inspection
           duties. I do not believe that the hearing
           officer is charged with overriding a
           management decision with respect to
           discipline upon a finding of misconduct
           unless the discipline meted out is arbitrary

                                - 10 -
          or contrary to law as in Siewert[v. VCU,
          Case No. HS-21-4 (Richmond Cir. Ct.,
          2/14/02)]. On examination of the record
          there is nothing to suggest that the agency
          came to its decision to terminate blindly or
          without a reasoned basis based on what went
          on during the course of its investigation,
          the nature of the infractions and Tatum's
          admissions. Here, we have an instance of
          the hearing officer substituting judgment
          regarding discipline, although reasonable,
          against that of the agency's which is also
          reasonable. Compared against the applicable
          legal standard namely, the agency's
          "exclusive right to manage [its] affairs and
          operations" See Va. Code § 2.2-3004(B),
          this difference of view must bend in favor
          of the agency determination of the proper
          sanction to be imposed for the infraction
          involved because the agency determination
          was reasonable and not arbitrary or contrary
          to law.

     Pursuant to Code § 17.1-405(1)(ii), Tatum appealed to this

Court from the circuit court's decision.   On appeal, Tatum

contends the circuit court erred in reversing the hearing

officer's decision reinstating Tatum to his job.   Tatum argues

that the circuit court erroneously relied upon Code § 2.2-3004(B)

for providing the applicable legal standard for its review.

Tatum argues that under the "Rules for Conducting Grievance

Hearings," VI, B.1. "the hearing officer may consider mitigating

or aggravating circumstances to determine whether the level of

discipline was too severe or disproportionate . . ." and under

the "Grievance Procedure Manual" the hearing officer "may order

appropriate remedies, including . . . [r]einstatement . . . ."

Tatum argues that the circuit court erred in finding that the

Department must prevail because "its [administrative]

determination was reasonable and not arbitrary or contrary to

                             - 11 -
law."    Tatum contends the circuit court erred in relying upon

Code § 2.2-3004(B) for providing the applicable standard for

review, which statute provides that "[m]anagement reserves the

exclusive right to manage the affairs and operations of state

government."    Rather, Tatum argues Code § 2.2-3005(D)(iii)

controls, which statute states that "[t]he decision of the

hearing officer . . . shall . . . be final and binding if

consistent with law and policy."    Tatum contends that by applying

that controlling statute, the circuit court was required to

uphold the hearing officer's decision.     Tatum asks this Court to

reverse the circuit court's decision and reinstate the hearing

officer's decision of a Group III written notice without removal.

                          STANDARD OF REVIEW

        Tatum did not appeal the hearing officer's finding that he

committed a Group III offense.    Therefore, that finding is final

and binding upon us.    With respect to the applicable standard of

review for appeals from a grievance proceeding, the State

Grievance Procedure, Code §§ 2.2-3000 et seq., defines the powers

and duties of a hearing officer.    The hearing officer is charged

with conducting a hearing upon a formal written grievance filed

by a covered non-probationary state employee.      See Code

§§ 2.2-3003 and 2.2-3005.    The hearing officer shall receive

probative relevant, material, non-privileged evidence, rebuttals

and cross-examinations, rule upon offers of proof, and oversee a

verbatim recording of the evidence.      See Code § 2.2-3005(C)(5).

The hearing officer orders appropriate remedies, which may

include "reinstatement, back pay, full reinstatement of fringe

benefits and seniority rights, or any combination of these
                                - 12 -
remedies" and shall "[t]ake other actions as necessary or

specified in the grievance procedure."     Code § 2.2-3005(6) and

(7).   The hearing officer's decision "shall (i) be in writing,

(ii) contain findings of fact as to the material issues in the

case and the basis for those findings, and (iii) be final and

binding if consistent with law and policy."     Code § 2.2-3005(D).

       In Virginia Dep't of State Police v. Barton, 39 Va. App.

439, 573 S.E.2d 319 (2002), this Court recognized that:

            [t]hese statutes clearly provide the hearing
            officer is to act as fact finder and the
            Director of the Department of Human
            Resources Management is to determine whether
            the hearing officer's decision is consistent
            with policy. In the grievance process,
            neither of these determinations is subject
            to judicial review, but only that part of
            the grievance determination "contradictory
            to law."

Id. at 445, 573 S.E.2d at 322.

       Upon judicial review from the administrative grievance

hearing, the circuit court, based on the record and sitting

without a jury, may affirm, reverse or modify the hearing

officer's decision.   Code § 2.2-3006(A).    "[T]he only grounds of

appeal of the hearing officer's decision [to the circuit court]

is 'that the determination is contradictory to law.'"      Barton, 39

Va. App. at 445, 573 S.E.2d at 322 (citation omitted).

       Thus, the Department, the party that appealed the hearing

officer's decision to the circuit court, was required to "specify

how that decision [was] 'contradictory' to law and what 'law'

[was] thereby being contradicted."      Id. at 445-46, 573 S.E.2d at

322.   In the circuit court, the Department was required to

"identify [a] constitutional provision, statute, regulation or
                               - 13 -
judicial decision which the [hearing officer's] decision

contradict[ed]."   Id. at 446, 573 S.E.2d at 323.   Thus, the

circuit court's only ground for reversing the hearing officer's

decision was that the hearing officer's decision was

contradictory to law.   Accordingly, we must determine whether the

circuit court followed the correct standard of review and whether

it reached the correct legal conclusion.

                              - 14 -
                               ANALYSIS

     The circuit court ruled that the hearing officer's decision

was contrary to law because the hearing officer overrode the

Department's "management decision" with respect to the

appropriate discipline to impose upon a finding of Group III

misconduct, where the Department's decision was not arbitrary or

contrary to law.    In so ruling, however, the circuit court did

not apply the correct standard for reviewing the decision of the

hearing officer.
     Where an agency removes or dismisses an employee for

misconduct, such as in this case, and a grievance hearing is

requested, the agency is required to prove "by a preponderance of

the evidence that the action was warranted and appropriate under

the circumstances."     See Grievance Procedure Manual § 5.8(2).

While the hearing officer is not a "super-personnel officer" and

should give appropriate deference to actions in agency management

that are consistent with law and policy, as to issues involving

the appropriate discipline, "the hearing officer reviews the

facts de novo . . . as if no determinations had been made yet, to
determine whether the cited actions occurred, whether they

constituted misconduct, and whether there were mitigating

circumstances to justify reduction or removal of the disciplinary

action or aggravating circumstances to justify the disciplinary

action."    See Rules for Conducting Grievance Hearings, VI(B)

(effective July 1, 2001).    The hearing officer is expressly

authorized to reduce the discipline if the officer finds that the

level or severity of discipline for the misconduct was too

severe.    Id.   The hearing officer is charged with the duty of
                                - 15 -
taking evidence and ordering appropriate remedies, which may

include reinstatement.     See Code § 2.2-3005.

        Here, the circuit court's reliance upon the general language

of Code § 2.2-3004(B) unduly limited the hearing officer's

express authority as set forth by statute and the rules and

procedures promulgated pursuant to the directive of Code

§ 2.2-3003(A).    No statute or rule provides that the hearing

officer may order reinstatement only where the agency's decision

was arbitrary or contrary to the law.    To the contrary, Code

§ 2.2-3005 provides that the hearing officer may make a decision

as to the appropriate sanction, independent of the agency's

decision.
        "[T]he only grounds of appeal of the hearing officer's

decision is 'that the determination is contradictory to law.'

. . .    Code § 2.1-116.07:1(B) ([now] § 2.2-3006(B)) represents

the first and only appearance of the phrase 'contradictory to

law' in the Code of Virginia as a standard of appellate review."

Barton, 39 Va. App. at 445, 573 S.E.2d at 322 (citation omitted).

"By its plain reading, Code § 2.1-116.07:1 [now Code § 2.2-3006]

makes it incumbent upon the party appealing the hearing officer's

decision to specify how that decision is 'contradictory' to the

law and what 'law' is thereby being contradicted."     Id. at

445-46, 573 S.E.2d at 322.    "'Law' is the 'aggregate of

legislation, judicial precedents and accepted legal principles.'"

Id. at 446, 573 S.E.2d at 323 (citation omitted).    Thus, the

circuit court erred in ruling that its judicial review of the

Department's decision and the hearing officer's decision

ultimately turned upon the overriding principle that the agency
                                - 16 -
has the "exclusive right to manage its affairs and operations,

and that the hearing officer substituted his judgment for that of

the agency."   The appropriate inquiry for the circuit court was

whether the hearing officer's decision was contradictory to law.

Id. at 447, 573 S.E.2d at 323.

     On appeal to the circuit court, the Department failed to

establish that the hearing officer's decision was contradictory

to any law.    Contrary to the Department's contentions, our review

of the hearing officer's January 2 and 16, 2002 decisions

discloses that the hearing officer reviewed de novo the
aggravating circumstances relied upon by the Department to

support disciplinary action, together with the mitigating

circumstances, and ordered that Tatum be reinstated to his

employment position.    The adjudicative acts of the hearing

officer were grounded in and consistent with the provisions of

Code §§ 2.2-3003 and 2.2-3005, as well as the Rules for
Conducting Grievance Hearings, VI(B).    In short, they were not

contradictory to law.   Moreover, the assertion by the Department

that the hearing officer did not follow state policy and

procedures in considering or weighing aggravating or mitigating

circumstances was rejected by the Director of the Department of

Employee Dispute Resolution and by the Director of the Department

of Human Resources Management. The circuit court was bound by

those decisions because they are final and not subject to

judicial review as a matter of law.     See Department of Employment

Dispute Resolution, Grievance Procedure Manual, § 7.2(c); see

also Code §§ 2.2-1001(5) and 2.2-3003(G).    "The General Assembly

has clearly vested review of policy issues involved in employee
                               - 17 -
grievances in the Department of Human Resource Management, and

not in the courts."   Barton, 39       Va. App. at 445, 573 S.E.2d

at 323.

     The circuit court's finding in this case that a hearing

officer's decision to mitigate discipline should be reversed on

the ground that it conflicted with the general principle set

forth in Code § 2.2-3004(B) would nullify the express power

granted to a hearing officer to decide de novo whether to

mitigate a disciplinary action and to order reinstatement.
     Accordingly, because the Department failed to establish that

the hearing officer's decision contradicted any "law," we reverse

the circuit court's decision overturning the hearing officer's

decision, and reinstate the hearing officer's decision.

                                       Reversed and final judgment.

                              - 18 -