Court Opinion

ID: 3214763
Source: CourtListenerOpinion
Date Created: 2016-06-20 14:07:45.981818+00
Date Added: 2024-06-11T14:30:03.051770
License: Public Domain

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
                                                                          FILED
this Memorandum Decision shall not be                                Jun 20 2016, 9:50 am

regarded as precedent or cited before any                                 CLERK
                                                                      Indiana Supreme Court
court except for the purpose of establishing                             Court of Appeals
                                                                           and Tax Court
the defense of res judicata, collateral
estoppel, or the law of the case.

ATTORNEYS FOR APPELLANT                                  ATTORNEYS FOR APPELLEE
David M. Austgen                                         REVIEW BOARD
Adam M. Sworden                                          Gregory F. Zoeller
Austgen Kuiper Jasaitis, P.C.                            Attorney General of Indiana
Crown Point, Indiana
                                                         Aaron T. Craft
                                                         Deputy Attorney General
                                                         Indianapolis, Indiana

                                           IN THE
    COURT OF APPEALS OF INDIANA

Town of Cedar Lake,                                      June 20, 2016
Appellant,                                               Court of Appeals Case No.
                                                         93A02-1512-EX-2165
        v.                                               Appeal from the Review Board of
                                                         the Department of Workforce
Review Board of the Indiana                              Development
Department of Workforce                                  Steven F. Bier, Chairperson,
Development, and Nicole                                  George H. Baker, Member, and
Hoekstra,                                                Larry A. Dailey, Member.

Appellees.                                               Cause No. 15-RB-1904

Bradford, Judge.

Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016          Page 1 of 9
                                          Case Summary
[1]   Between 2013 and 2015, Appellee Nicole Hoekstra was an employee of

      Appellant the Town of Cedar Lake (“Cedar Lake”). On July 10, 2015, Cedar

      Lake terminated Hoekstra’s employment for unsatisfactory work performance

      and dissemination of confidential information. A claims deputy for the Indiana

      Department of Workforce Development (“the Department”) determined that

      Cedar Lake did not have “just cause” to discharge Hoekstra and, as a result,

      Hoekstra was eligible for unemployment benefits. Cedar Lake appealed the

      decision and an Administrative Law Judge (“ALJ”) affirmed the deputy’s

      decision, concluding that Cedar Lake did not have just cause to terminate

      Hoekstra because she did not disseminate confidential information and Cedar

      Lake failed to follow its own progressive discipline policy. Upon final review

      by the Department’s Review Board (“the Board”), the Board affirmed the ALJ’s

      decision and adopted its findings of fact and conclusions of law. On appeal,

      Cedar Lake contends that there was insufficient evidence to support the Board’s

      determination that Hoekstra was not discharged for just cause. We affirm the

      Board’s decision.

                            Facts and Procedural History
[2]   Hoekstra began working for Cedar Lake as an administrative assistant and

      special events coordinator on April 15, 2013. On July 10, 2015, Cedar Lake

      terminated Hoekstra’s employment for unsatisfactory work performance,

      violation of Cedar Lake’s policy on email use, and dissemination of

      Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016   Page 2 of 9
      confidential information. In the termination notice sent to Hoekstra, Cedar

      Lake outlined the incidents of alleged misconduct which included failure to

      complete various assigned tasks in a timely manner, failure to attend two town

      events (Flag Day and Chamber of Commerce Business Expo), and deleting

      emails which Cedar Lake considered destruction of public records. The notice

      also listed a general violation of Cedar Lake’s policy prohibiting “Disclosure of

      confidential Town information to outsiders without proper authorization.”

      Appellant’s App. p. 12. Cedar Lake alleged that Hoekstra violated this policy

      by emailing the meeting minutes regarding an engineering project to

      Eric Wolverton, one of the engineers working on the project. Cedar Lake

      acknowledges that these records were available to the public but maintained

      that a public record request was required. Hoekstra testified that Wolverton

      informally requested the minutes, that he was the design engineer for the

      project, that he typically attended the meetings but was unable to attend this

      particular meeting, and that she did not believe any of the information she

      shared was confidential.

[3]   On August 28, 2015, a claims deputy for the Department determined that

      Cedar Lake did not have just cause to discharge Hoekstra and that she was

      entitled to unemployment benefits. Cedar Lake appealed the decision and an

      ALJ held a hearing on October 15, 2015. On October 19, the ALJ affirmed the

      deputy’s decision, concluding that Cedar Lake did not have just cause to

      terminate Hoekstra. The ALJ’s findings of fact were, in relevant part, as

      follows:

      Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016   Page 3 of 9
        Employer had a policy on email use. See Employer Exhibit 1
        (Section IV ?D). “Improper (i.e. Immoral, Unethical and
        Unprofessional) use of the Town’s computers and the Town’s
        email system will not be tolerated.” Employer’s policy did not
        further define what proper use was. The policy did not specify if
        email could be used for personal use. Employer testified that
        there was a policy on retaining email. Employer did not submit
        the policy for the record. [Hoekstra] refused to stipulate to the
        policy. The [ALJ] finds there was no Employer policy on the
        retention of emails. While there are state laws that require
        government to maintain email for a certain amount of time, no
        evidence was offered that Employer ever made [Hoekstra] aware
        of these laws.

        In the three years that [Hoekstra] worked for Employer, she
        received two promotions. Employer had a progressive discipline
        policy to correct unsatisfactory work performance or misconduct
        by employees. Employer never issued any steps of discipline to
        [Hoekstra] per the progressive discipline policy.

        Employer would assign [Hoekstra] tasks, but not set a deadline.
        [Hoekstra] worked on several projects simultaneously for
        Employer. Employer did not prioritize the projects for
        [Hoekstra]. Jill Murr felt [Hoekstra] was not completing her
        duties in a timely manner. Murr felt [Hoekstra] was a poor
        communicator. Rather than use the progressive discipline policy
        to correct any deficiency in [Hoekstra]’s performance, Murr
        compiled records of everything [Hoekstra] had done wrong. See
        Employer’s Exhibit 5. Murr did not confront [Hoekstra] about
        the failures.

        [Hoekstra] did use her email for personal limited use. She used it
        on break times when Employer allowed such activity. [Hoekstra]
        carried on several conversations with Eric Wolverton, an
        engineer that worked on projects for the city. [Hoekstra]’s tone
        with Wolverton was friendly and personal, but was not
        unprofessional. [Hoekstra] provided Wolverton with
        information about city projects. That information was not
Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016   Page 4 of 9
              confidential. As someone who worked for the city, Wolverton
              had an interest in knowing what was going on in city
              government. Wolverton did not file form requests under the
              Access to Public Records Act, but [Hoekstra] provided the
              information on the basis of an informal request. Employer had
              no policy that employees could not provide public information to
              the public.

              [Hoekstra] deleted several emails from her computer.
              [Hoekstra]’s email box was full, and this caused [Hoekstra] to be
              unable to send or receive messages. [Hoekstra] deleted sent
              emails to free up space. Later the email was expanded, and
              [Hoekstra] was again able to use her email. Employer had its IT
              department retrieve the deleted emails, which had not been
              completely deleted from the system.

      Appellant’s App. pp. 2-3.

[4]   Among its conclusions of law, the ALJ found that (1) Cedar Lake’s email

      policy “was a guideline rather than a rule because it did not define prohibited

      conduct,” (2) “prohibitions against immoral, unethical, and unprofessional

      conduct are too vague to inform an employee of what type of behavior will

      violate the policy,” (3) “an employee could not knowingly violate the policy,”

      and (4) Hoekstra did not use her work email in an immoral, unethical, or

      unprofessional manner. Appellant’s App. p. 4. The ALJ also found that Cedar

      Lake “had a progressive discipline policy to inform employees when they were

      failing to meet employer’s reasonable expectation,” did not use its progressive

      discipline policy with Hoekstra, did not attempt to correct any perceived

      deficiency in Hoekstra’s conduct, did not inform Hoekstra that her work was

      Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016   Page 5 of 9
      unacceptable, and that “[a] reasonable employee would not understand that the

      conduct here would lead to discharge.” Appellant’s App. p. 4.

[5]   On November 3, 2015, Cedar Lake appealed the ALJ’s decision to the Board.

      On November 20, the Board affirmed the ALJ’s decision and adopted the

      ALJ’s findings of facts and conclusions of law.

                                 Discussion and Decision
                                        Standard of Review
[6]   Cedar Lake appeals the Board’s determination that Hoekstra was not

      discharged for just cause and, therefore, is eligible for unemployment benefits.

      Our standard of review for a determination by the Board is threefold. “We

      review the Board’s findings of basic facts under a ‘substantial evidence’

      standard, and we neither reweigh the evidence nor assess its credibility. We

      consider only the evidence most favorable to the Board’s findings and, absent

      limited exceptions, treat those findings as conclusive and binding.” Chrysler

      Grp., LLC v. Review Bd. of Ind. Dep’t of Workforce Dev., 960 N.E.2d 118, 122 (Ind.

      2012); see also Ind. Code § 22-4-17-12 (“Any decision of the review board shall

      be conclusive and binding as to all questions of fact.”). “Ultimate facts––

      typically mixed questions of fact and law––are reviewed to ensure the Board

      has drawn a reasonable inference in light of its findings on the basic, underlying

      facts.” Id. We give more deference to the Board where the matter lies within

      the particular expertise of the administrative agency. Id. Finally, we generally

      review the Board’s conclusions of law de novo; however, “[a]n interpretation of
      Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016   Page 6 of 9
      a statute by an administrative agency charged with the duty of enforcing the

      statute is entitled to great weight, unless this interpretation would be

      inconsistent with the statute itself.” Id. at 123 (quoting LTV Steel Co. v. Griffin,

      730 N.E.2d 1251, 1257 (Ind. 2000)).

             Whether Hoekstra was Discharged for Just Cause
[7]   The purpose of Indiana’s Unemployment Compensation Act (“the Act”) is to

      “provide for payment of benefits to persons unemployed through no fault of

      their own.” Ind. Code § 22-4-1-1. However, an individual is ineligible for

      unemployment benefits if he or she is discharged for “just cause.” P.K.E. v.

      Review Bd. of Ind. Dep’t of Workforce Dev., 942 N.E.2d 125, 130 (Ind. Ct. App.

      2011) (citing Ind. Code § 22-4-15-1). According to the Act, “discharge for just

      cause” includes, but is not limited to, an employee’s “knowing violation of a

      reasonable and uniformly enforced rule of an employer,” “refusing to obey

      instructions,” or “any breach of duty in connection with work which is

      reasonably owed an employer by an employee.” Ind. Code § 22-4-15-1(d).

      This court has previously held that “[t]o find that a discharge was for just cause,

      the Review Board must first find that: (1) there was a rule; (2) the rule was

      reasonable; (3) the rule was uniformly enforced; (4) the claimant knew of the

      rule; and (5) the claimant knowingly violated the rule.” S.S. LLC v. Review Bd.

      of Ind. Dep’t of Workforce Dev., 953 N.E.2d 597, 601 (Ind. Ct. App. 2011) (citing

      Barnett v. Review Bd., 419 N.E.2d 249 (Ind. Ct. App. 1981)).

      Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016   Page 7 of 9
[8]   On appeal, Cedar Lake reiterates the arguments it made to the ALJ and Board;

      that Hoekstra underperformed on regular tasks and knowingly violated rules in

      the employee handbook. However, Cedar Lake does not dispute nor even

      address the Board’s determination that Cedar Lake failed to utilize its own

      progressive discipline policy, and it is this determination that appears to be at

      the crux of the Board’s ultimate conclusion. Cedar Lake’s progressive

      disciplinary policy provides for the corrective action Cedar Lake would take in

      the event of disciplinary violations by an employee. Disciplinary violations are

      categorized into Group I and Group II Rules, the latter being the more serious

      violations. The policy provides that

              If a violation of a Group I rule occurs, the Department Head will
              use the following procedures:
              Step 1. Corrective interview, confirmed in writing.
              Step 2. Violation of any Group I rule, within the calendar year,
              may subject the employee to up to 3 days suspension without
              pay.
              Step 3. Violations of any Group I Rule, following a disciplinary
              suspension will be subject to termination. (Pending review by a
              Town Council hearing).

      Ex. p. 73. The policy further provides that “Any violation of a Group II rule

      will result in the employee being relieved from duty with pay from 3 to 5 days

      and may be subject to termination pending an Administrative hearing.” Ex. p.

      74. The only Group II rule which Hoekstra was alleged to have violated was

      “Disclosure of confidential Town information.” Ex. p. 74.

      Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016   Page 8 of 9
[9]    The Board specifically found that “[Cedar Lake] never issued any steps of

       discipline to [Hoekstra] per the progressive discipline policy,” did not “use the

       progressive discipline policy to correct any deficiency in [Hoekstra]’s

       performance,” did not confront Hoekstra about the alleged failures in her

       performance, and promoted Hoekstra twice during her three years working for

       Cedar Lake. Appellant’s App. p. 4. Again, Cedar Lake does not contest these

       findings. Because Cedar Lake ignored its own policy and gave Hoekstra no

       indication that she had violated any rules, we conclude that Cedar Lake’s

       disciplinary rules were not uniformly enforced and that there is insufficient

       evidence that Hoekstra knowingly violated the rules. See Coleman v. Review Bd.

       of Ind. Dep’t of Workforce Dev., 905 N.E.2d 1015, 1021 (Ind. Ct. App. 2009)

       (employer failed to use its progressive discipline policy to deal with employee’s

       improper email use and so evidence was insufficient to find that claimant

       knowingly violated a uniformly enforced rule).

[10]   Furthermore, concerning the single alleged Group II violation––the only

       violation which would be eligible for termination on the first offense––the

       Board found, and Cedar Lake concedes, that the records released by Hoekstra

       were public and not confidential. Accordingly, Hoekstra’s actions would not

       qualify as “disclosure of confidential Town information” sufficient to establish

       a Group II violation.

[11]   The judgment of the Board is affirmed.

       Bailey, J., and Altice, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 93A02-1512-EX-2165 | June 20, 2016   Page 9 of 9