Court Opinion

ID: 4457949
Source: CourtListenerOpinion
Date Created: 2019-11-21 18:03:11.486619+00
Date Added: 2024-06-11T14:51:21.040558
License: Public Domain

The summaries of the Colorado Court of Appeals published opinions
  constitute no part of the opinion of the division but have been prepared by
  the division for the convenience of the reader. The summaries may not be
    cited or relied upon as they are not the official language of the division.
  Any discrepancy between the language in the summary and in the opinion
           should be resolved in favor of the language in the opinion.

                                                                 SUMMARY
                                                          November 21, 2019

                               2019COA173

No. 19CA0679, M & A Acquisition Corp. v. ICAO — Labor and
Industry — Colorado Employment Security Act — Benefit
Awards

     As a matter of first impression, the division concludes that the

ICAO Appeals Panel erroneously treats section 8-73-108(5)(e)(IX.5),

C.R.S. 2019 as the exclusive applicable provision for disqualifying

an employee from unemployment compensation eligibility when the

employee’s separation from employment resulted from a positive

drug test administered pursuant to the employer’s drug policy.
COLORADO COURT OF APPEALS                                     2019COA173

Court of Appeals No. 19CA0679
Industrial Claim Appeals Office of the State of Colorado
DD No. 48631-2018

M & A Acquisition Corp./West Star Aviation, Inc.,

Petitioner,

v.

Industrial Claim Appeals Office of the State of Colorado and Ryan D. Holm,

Respondents.

                       ORDER SET ASIDE AND CASE
                       REMANDED WITH DIRECTIONS

                                  Division VII
                            Opinion by JUDGE TOW
                         J. Jones and Fox, JJ., concur

                        Announced November 21, 2019

Bechtel Santo & Severn, Michael C. Santo, Emily E. Tichenor, Grand Junction,
Colorado, for Petitioner

No Appearance for Respondents
¶1    In this unemployment compensation benefits case, M & A

 Acquisition Corp. seeks review of a final order of the Industrial

 Claim Appeals Office (Panel). The Panel affirmed a hearing officer’s

 decision awarding benefits to Ryan D. Holm. M & A discharged

 Holm because he tested positive for marijuana.

¶2    M & A contends that the Panel erred by limiting its analysis to

 a single disqualifying subsection of the statute, section 8-73-

 108(5)(e)(IX.5), C.R.S. 2019, and by expressly declining to consider

 other potentially applicable disqualifying subsections. We agree

 and therefore set aside the Panel’s order and remand for further

 proceedings.

                            I. Background

¶3    We derive the following information concerning Holm’s job

 separation from the hearing officer’s findings.

¶4    Holm worked for M & A as a full-time aircraft mechanic. He

 was injured at work in February 2017. Although he returned to

 work for a few days in April and May 2017, he was eventually

 placed on a medical leave of absence on May 30, 2017.

¶5    While on medical leave, Holm needed to go into M & A’s office

 every other week to make payments on a loan against his

                                   1
 retirement account. In November 2017, while Holm was in the

 office making a loan payment, a person in human resources notified

 him that his name had been pulled for a random drug test. M & A

 had a written policy requiring employees to submit to random drug

 tests if their names came up for such testing. Holm was aware of

 this policy. Holm tested positive for marijuana, and M & A

 thereafter discharged him based on the test result.

¶6    The hearing officer found that Holm was still an M & A

 employee and therefore subject to the drug testing policy but was

 not working when he was tested. The hearing officer determined

 that because Holm had been on a leave of absence since May 30,

 2017, and had not performed work for M & A since that date, he

 was not at fault for the job separation. Consequently, the hearing

 officer awarded Holm benefits on a no-fault basis. See § 8-73-

 108(1)(a) (setting forth the guiding legislative principle that

 “unemployment insurance is for the benefit of persons unemployed

 through no fault of their own”).

¶7    M & A appealed the decision to the Panel, arguing that Holm

 was disqualified from receiving benefits under three statutory

 provisions: (1) “[v]iolation of a statute or of a company rule which

                                     2
 resulted or could have resulted in serious damage to the employer’s

 property or interests”; (2) “[o]ff-the-job use of not medically

 prescribed intoxicating beverages or controlled substances . . . to a

 degree resulting in interference with job performance”; and (3)

 “failure to meet established job performance or other defined

 standards.” § 8-73-108(5)(e)(VII), (VIII), (XX).

¶8    On review, the Panel affirmed the hearing officer’s decision but

 applied a different rationale. It concluded that “when an individual

 is separated from employment due to a positive drug test

 administered pursuant to the employer’s drug policy, the provisions

 of [section] 8-73-108(5)(e)(IX.5), C.R.S. are exclusive” and

 disqualification “is not warranted under one of the more general

 disqualification provisions.” Hence, the Panel declined to consider

 whether the three other possible disqualifying subsections urged by

 M & A applied.

¶9    Because marijuana was not present in Holm’s system “during

 working hours” as required by subsection (IX.5), the Panel

 concluded that he was not disqualified from receiving benefits

 under that subsection. Based on its conclusion that subsection

 (IX.5) was the only potentially applicable disqualifying subsection,

                                     3
  the Panel reasoned that since its requirements were not met, Holm

  was not at fault for the separation and was entitled to an award of

  benefits.

                              II. Discussion

¶ 10   M & A contends that the Panel erred by considering only

  subsection (IX.5) and by expressly declining to consider other

  possible disqualifying subsections. We agree.

¶ 11   We may set aside a Panel decision if, among other reasons, it

  is erroneous as a matter of law. See § 8-74-107(6), C.R.S. 2019;

  Whitewater Hill, LLC v. Indus. Claim Appeals Office, 2015 COA 5,

  ¶ 10. We review de novo an agency’s legal conclusions, including

  its interpretation of statutes. Whitewater Hill, ¶ 10.

¶ 12   As pertinent here, subsection (IX.5) provides for

  disqualification from the receipt of benefits based on the

              presence in an individual’s system, during
              working hours, of not medically prescribed
              controlled substances . . . as evidenced by a
              drug or alcohol test administered pursuant to
              a statutory or regulatory requirement or a
              previously established, written drug or alcohol
              policy of the employer and conducted by a
              medical facility or laboratory licensed or
              certified to conduct such tests.

  § 8-73-108(5)(e)(IX.5).

                                     4
¶ 13   Nothing in the language of this subsection supports the

  Panel’s conclusion that it should be applied exclusively in certain

  circumstances. Furthermore, the Panel’s conclusion that

  subsection (IX.5) applies exclusively directly conflicts with the

  following language in section 8-73-108(5)(e): “[I]f a separation from

  employment occurs for any of the following reasons, the employer

  from whom such separation occurred must not be charged for

  benefits which are attributable to such employment and . . . a

  payment of such benefits must not be made from [the

  unemployment compensation] fund . . . .” (Emphasis added.) The

  statute then lists twenty-five separate subsections, each of which

  describes a separate possible circumstance or reason supporting

  benefit disqualification. See § 8-73-108(5)(e)(I)-(XXIV). Section 8-

  73-108(4), which lists the statute’s various qualifying provisions,

  contains the same “any of the following reasons” language.

¶ 14   Thus, the statute contemplates that hearing officers and the

  Panel will consider all potentially applicable qualifying and

  disqualifying provisions. See Mattison v. Indus. Comm’n, 33 Colo.

  App. 203, 206-07, 516 P.2d 1143, 1145 (1973) (noting that where

  cases “fall within two or more provisions of the Act . . . the

                                     5
  Commission has wide latitude in determining which section will be

  applied” and that if “the facts of a case are covered specifically by

  one section of the statute, that provision must be applied”); see also

  Dailey, Goodwin & O’Leary, P.C. v. Div. of Emp’t, 40 Colo. App. 256,

  259, 572 P.2d 853, 855 (1977) (stating that “the facts in a given

  case [must] be examined to ascertain if they bring the matter within

  any statutory category”).

¶ 15   To support its conclusion that Holm’s firing based on the

  positive drug test only triggers consideration of subsection (IX.5),

  the Panel stated as follows: “In our view, the reasoning of the court

  of appeals in Board of Water Commissioners v. Industrial Claim

  Appeals Office, 881 P.2d 476 (Colo. App. 1994) and the fact that the

  General Assembly subsequently enacted [section] 8-73-

  108(5)(e)(IX.5) is controlling.” We are not persuaded that either

  Board of Water Commissioners or the enactment of subsection (IX.5)

  supports the Panel’s conclusion.

¶ 16   First, contrary to the Panel’s assertion, Board of Water

  Commissioners was announced on August 11, 1994, more than a

  month after subsection (IX.5) became effective on July 1, 1994. See

  Ch. 321, sec. 1, § 8-73-108(5)(e)(IX.5), 1994 Colo. Sess. Laws 1998.

                                     6
  Thus, to the extent the Panel considered subsection (IX.5) to be a

  legislative response to Board of Water Commissioners, it was in

  error.

¶ 17   Furthermore, nothing in Board of Water Commissioners itself

  supports the Panel’s conclusion that subsection (IX.5) should be

  applied exclusively. In that case, the claimant was fired because he

  tested positive for cocaine in violation of the employer’s substance

  abuse policy. Bd. of Water Comm’rs, 881 P.2d at 477. However, the

  hearing officer awarded the claimant benefits, concluding that

  although he had been fired for violating a company rule, the

  employer had not established the requisite “serious damage” or

  “endangerment” to support disqualification under section 8-73-

  108(5)(e)(VII). Bd. of Water Comm’rs, 881 P.2d at 477-78. The

  hearing officer also determined that the claimant was not

  responsible or “at fault” for the separation. Id. at 478.

¶ 18   The Panel affirmed. Id. It rejected the employer’s argument

  that the claimant should be disqualified under two subsections

  specifically relating to controlled substances, section 8-73-

  108(5)(e)(VIII) and (IX). Bd. of Water Comm’rs, 881 P.2d at 478.

                                     7
¶ 19   On review, a division of this court reversed. Based on the

  evidentiary record, the division concluded that the claimant was (1)

  at fault for the job separation and (2) disqualified from receiving

  benefits under a statutory subsection the Panel and the hearing

  officer had not even considered — section 8-73-108(5)(e)(XX) (failure

  to meet established job performance or other defined standards).

  Bd. of Water Comm’rs, 881 P.2d at 478.

¶ 20   In our view, Board of Water Commissioners does not support

  the Panel’s conclusion that it should only consider a single

  disqualifying subsection in this type of job separation scenario. To

  the contrary, it supports the apparent legislative intent expressed in

  section 8-73-108 that hearing officers and the Panel should

  consider all potentially applicable subsections of the statute.

¶ 21   Moreover, the employer’s failure to satisfy the specific

  requirements for disqualification under subsection (IX.5) does not,

  in our view, justify ignoring other more general and potentially

  applicable subsections. We note that the Board of Water

  Commissioners division chose to consider and apply a more general

  subsection — section 8-73-108(5)(e)(XX) — even though the

  evidence in that case did not support applying other disqualifying

                                     8
  subsections, including two that more specifically addressed

  controlled substances. Indeed, construing subsection (IX.5) to

  apply exclusively would effectively nullify or render meaningless

  section 8-73-108(5)(e)’s language that disqualification is required if

  “any of the following reasons” contained in the twenty-five

  subsections exists. See Yotes, Inc. v. Indus. Claim Appeals Office,

  2013 COA 124, ¶ 14 (courts must give consistent, harmonious, and

  sensible effect to all parts of a statute and avoid an interpretation or

  construction that renders any language meaningless).

¶ 22   It appears the Panel may have invoked the canon of statutory

  interpretation dictating that the specific overrides the general. See

  § 2-4-205, C.R.S. 2019. However, where statutory provisions

  appear to conflict, they “shall be construed, if possible, so that

  effect is given to both.” Id. In other words, the specific-overrides-

  general canon “is only applicable when ‘a conflict between two

  statutory provisions is irreconcilable.’” Young v. Brighton Sch. Dist.

  27J, 2014 CO 32, ¶ 16 (emphasis in Young) (quoting Martin v.

  People, 27 P.3d 846, 860 (Colo. 2001)).

¶ 23   Any conflict among the provisions at issue in this case is not

  irreconcilable. Subsection (IX.5) disqualifies an individual for the

                                     9
  sole reason that he or she had a positive drug or alcohol test while

  working, essentially dispensing with the need for an employer to

  establish any impairment of the employee’s abilities or adverse

  effect on the employer’s business. However, subsection (VII) would

  apply where an employee violates an employer’s rule prohibiting

  drug use, whether on or off the job, but an employer would be

  required to demonstrate that the employee’s drug use had, or could

  have had, adverse impacts on the company. Similarly, subsection

  (VIII) could be applied to off-the-job drug use but requires proof that

  the drug use interfered with the employee’s job performance. And

  subsection (XX), when applied in a drug use or testing scenario,

  requires the employer to establish that an employee’s drug use or

  failed drug test caused him or her to fail to meet an established job

  performance or other defined standard. Because there is no

  irreconcilable conflict, all provisions of the statute are amenable to

  harmonious construction, and thus must be given effect.

¶ 24    For these reasons, we agree with M & A’s contention that the

  Panel erred by limiting its analysis in this case solely to subsection

  (IX.5).

                                    10
¶ 25   We note the Panel ultimately concluded that Holm was not at

  fault for the discharge, and we acknowledge that such a conclusion

  could, by itself, support an award of benefits. See Cole v. Indus.

  Claim Appeals Office, 964 P.2d 617, 618 (Colo. App. 1998) (“[E]ven if

  the findings of the hearing officer may support the application of

  one of the disqualifying sections of the statute, a claimant may still

  be entitled to benefits if the totality of the circumstances establishes

  that the claimant’s separation occurred through no fault of her

  own.”). But it appears that the Panel’s fault analysis was based

  solely on its erroneous conclusion that subsection (IX.5) applies

  exclusively.

¶ 26   We conclude that the proper remedy is to set aside the Panel’s

  order and remand for it to consider whether the findings and the

  evidence should support disqualifying Holm under any of the other

  statutory subsections asserted by M & A. In doing so, we express

  no opinion as to the merits of M & A’s contentions that Holm is

  disqualified under any of the three provisions, particularly in light

  of the hearing officer’s factual finding that Holm’s use of marijuana

  did not interfere with his performance at work. We also note that,

  on remand, the Panel is to review the matter on the record before it,

                                    11
  and consider only those arguments previously asserted by M & A.

  The Panel should also determine whether Holm was at fault for the

  separation using the generally recognized legal standards for that

  inquiry. See Mesa Cty. Pub. Library Dist. v. Indus. Claim Appeals

  Office, 2017 CO 78, ¶ 18; Cole, 964 P.2d at 618-19.

                            III. Conclusion

¶ 27   The Panel’s order is set aside, and the case is remanded for

  further proceedings consistent with the views expressed in this

  opinion.

       JUDGE J. JONES and JUDGE FOX concur.

                                   12