Opinion
No. A04-128.
Filed September 7, 2004.
Appeal from the Department of Employment and Economic Development, File No. 12506 03.
Casey J. Katchmark, (pro se relator)
Schaefer Hardwood Floors, (respondent)
Lee B. Nelson, Linda A. Holmes, Department of Employment and Economic Development, (for respondent Commissioner)
Considered and decided by Peterson, Presiding Judge; Stoneburner, Judge; and Wright, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2002).
UNPUBLISHED OPINION
Relator challenges the decision of the commissioner's representative that relator is disqualified from receiving unemployment benefits because he was discharged for employment misconduct. We affirm.
FACTS
Relator Casey Katchmark was employed by respondent Schaefer Hardwood Floors as a floor refinisher from September 17, 2001, through June 13, 2003. In early June 2003, while Katchmark was refinishing a client's kitchen floor, the client inquired as to Katchmark's interest in finishing the rest of the home's floors as a side job. The client also asked whether Katchmark knew anyone who would perform the work for less than Schaefer charged. Although Katchmark advised that he would not work for the client outside his employment with Schaefer, he referred the client to a friend and former employer. When the client informed Schaefer's owner that Katchmark had referred the client to Katchmark's former employer, the owner confronted Katchmark and terminated his employment.
Katchmark applied for unemployment benefits. The Department of Employment and Economic Development determined that he was disqualified from receiving unemployment benefits because his behavior "violate[ed] the basic trust between the employer and the employee," which constitutes employment misconduct. On appeal from the decision of the unemployment law judge, the commissioner's representative determined that Katchmark committed employment misconduct by engaging in "intentional, negligent or indifferent conduct evincing a serious violation of the standards of behavior that the employer has the right to reasonably expect of an employee . . . demonstrating a substantial lack of concern for the employment." This certiorari appeal followed.
DECISION
We review the findings of the commissioner's representative rather than those of the unemployment law judge. Tuff v. Knitcraft Corp., 526 N.W.2d 50, 51 (Minn. 1995). In doing so, we view the findings in the light most favorable to the decision and will not disturb them when they are reasonably sustained by the evidence. Ress v. Abbott Northwestern Hosp., Inc., 448 N.W.2d 519, 523 (Minn. 1989).
An employee who is discharged for employment misconduct is disqualified from receiving unemployment benefits. Minn. Stat. § 268.095, subd. 4(1) (2002). Employment misconduct is defined as "(1) any intentional conduct . . . that disregards the standards of behavior that an employer has the right to expect of the employee or disregards the employee's duties and obligations to the employer or (2) negligent or indifferent conduct . . . that demonstrates a substantial lack of concern for the employment." Minn. Stat. § 268.095, subd. 6(a) (2002). But "inefficiency, inadvertence, simple unsatisfactory conduct, poor performance because of inability or incapacity . . . are not employment misconduct." Id. Whether an employee committed disqualifying misconduct is a mixed question of fact and law. Colburn v. Pine Portage Madden Bros., Inc., 346 N.W.2d 159, 161 (Minn. 1984). Whether the employee committed a particular act is a question of fact, which we review for clear error. See Scheunemann v. Radisson S. Hotel, 562 N.W.2d 32, 34 (Minn.App. 1997). Whether the act constitutes misconduct is a question of law, which we review de novo. Ress, 448 N.W.2d at 523. Katchmark does not dispute the findings of fact. Thus, our review is limited to whether Katchmark's acts constitute employment misconduct.
The definition of employment misconduct was amended by the legislature, effective August 1, 2003. 2003 Minn. Laws 1st Spec. Sess. ch. 3, art. 2, §§ 13, 20(g); see Minn. Stat. § 645.02 (2002). We apply the definition in effect at the time the discharge occurred. Bray v. Dogs Cats Ltd., 679 N.W.2d 182, 185-86 (Minn.App. 2004). Because the discharge at issue here occurred prior to August 1, 2003, we apply the 2002 definition of employment misconduct in our analysis.
We apply a two-pronged analysis in determining whether an employee's actions constitute intentional "employment misconduct." Houston v. Int'l Data Transfer Corp., 645 N.W.2d 144, 149 (Minn. 2002). The employee's conduct must (1) be intentional and (2) disregard standards of behavior that the employer has a right to expect or the employee's duties and obligations to the employer. Id. Under the first prong, Houston requires that, to be intentional, the conduct in question be "deliberate" and "not accidental." Id. When an employee acts innocently, and without intent to be disobedient or harm the employer, there is no employment misconduct. Tuckerman Optical Corp. v. Thoeny, 407 N.W.2d 491, 494 (Minn.App. 1987); see also Sticha v. McDonald's No. 291, 346 N.W.2d 138, 140 (Minn. 1984) (finding no disqualifying misconduct when employee inadvertently misled employer to believe employee was taking time off for funeral rather than wake).
The second prong of the Houston test requires an analysis of the employee's intent that is "separate and distinct" from the intentional conduct required in the first prong. Houston, 645 N.W.2d at 150. Thus, the Houston test for employment misconduct requires that the employee not only engage in intentional conduct, but also engage in, or intend to engage in, conduct that evinces an intent to ignore or pay no attention to his or her duties and obligations or the standards of behavior the employer has a right to expect. Id.
Katchmark does not, however, argue that he inadvertently referred the client to his former employer. Rather, he asserts that he did not intend to harm Schaefer by referring the client to a competitor. Katchmark also maintains that he was not aware that Schaefer considered referring a client to a competitor to be misconduct.
Employers have a legitimate interest in protecting themselves against "`the deflection of trade or customers by the employee by means of the opportunity which the employment has given him.'" Webb Publ'g Co. v. Fosshage, 426 N.W.2d 445, 450 (Minn.App. 1988) (quoting Bennett v. Storz Broad. Co., 270 Minn. 525, 533, 134 N.W.2d 892, 898 (1965)). Similarly, an employee owes a duty of loyalty to the employer that prohibits the employee from competing with the employer during the employment. Rehabilitation Specialists, Inc. v. Koering, 404 N.W.2d 301, 304 (Minn.App. 1987); Sanitary Farm Dairies, Inc. v. Wolf, 261 Minn. 166, 175, 112 N.W.2d 42, 48-49 (1961). By referring the client to a competitor, Katchmark exhibited an intent to ignore his duty of loyalty, which Schaefer had a right to expect. Cf. Houston, 645 N.W.2d at 150.
Accordingly, the commissioner's representative properly determined that the actions for which Katchmark was discharged constitute employment misconduct.