Opinion
NO. 2018-CA-000793-MR
02-07-2020
KENTUCKY AUTHORITY FOR EDUCATIONAL TELEVISION, Appellant v. ESTATE OF Patrick WISE; Commonwealth of Kentucky, Personnel Board, Mark A. Sipek, Executive Director; and Commonwealth of Kentucky, Personnel Cabinet, Thomas B. Stephens, Secretary, Appellees
BRIEFS FOR APPELLANT: Deborah H. Patterson, Sean Williamson, Sharon L. Gold, Louisville, Kentucky, Sam Flynn, Assistant Attorney General, Frankfort, Kentucky. ORAL ARGUMENT FOR APPELLANT: Sean Williamson, Louisville, Kentucky. BRIEF AND ORAL ARGUMENT FOR APPELLEE ESTATE OF PATRICK WISE: Robin Cornette, Lexington, Kentucky. BRIEF FOR APPELLEE PERSONNEL CABINET: Rosemary G. Holbrook, Frankfort, Kentucky.
BRIEFS FOR APPELLANT: Deborah H. Patterson, Sean Williamson, Sharon L. Gold, Louisville, Kentucky, Sam Flynn, Assistant Attorney General, Frankfort, Kentucky.
ORAL ARGUMENT FOR APPELLANT: Sean Williamson, Louisville, Kentucky.
BRIEF AND ORAL ARGUMENT FOR APPELLEE ESTATE OF PATRICK WISE: Robin Cornette, Lexington, Kentucky.
BRIEF FOR APPELLEE PERSONNEL CABINET: Rosemary G. Holbrook, Frankfort, Kentucky.
BEFORE: CLAYTON, CHIEF JUDGE; GOODWINE AND L. THOMPSON, JUDGES.
OPINION
CLAYTON, CHIEF JUDGE: The Kentucky Authority for Educational Television (KET) appeals from an opinion and order of the Franklin Circuit Court affirming a final order of the Kentucky Personnel Board (Board). The Board found that Patrick J. Wise, a technician whose employment with KET was terminated in 2010, was the victim of age discrimination and awarded him back pay and other benefits. At issue is whether the Personnel Board had jurisdiction to address Wise's petition and whether there was sufficient evidence to support its ruling.
Patrick Wise passed away on August 1, 2015, during the course of the proceedings before the Board. His estate was substituted as a party.
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Wise began his employment as a Broadcast Technician Specialist with KET in 1991. In 2010, he was one of thirteen employees who were terminated without cause by KET in response to a state budget cut of approximately twenty-six percent. Wise, who was fifty-seven years of age at the time, was selected for termination by Fred Engel, Senior Director for Technology. According to Engel, Wise's employment was terminated because he was not interested in working on new digital equipment, had a bad attitude and a poor work ethic.
After receiving his notice of termination, Wise filed an EEOC complaint alleging age and race discrimination. The complaint was dismissed with a notice of rights. Wise and several of the other terminated KET employees filed appeals with the Board, raising various claims including discrimination based upon age. KET moved to dismiss their appeals on the grounds that the Personnel Board lacked jurisdiction, claiming Kentucky Revised Statutes (KRS) 18A.115(1)(f) granted KET "sole authority" over the dismissal of its non-classified employees. Wise's appeal to the Board was consolidated with those of three others and a consolidated evidentiary hearing was held over a period of seven months.
On May 3, 2016, the hearing officer entered a recommended order finding that Wise was the victim of age discrimination and recommending dismissal of all his other discrimination claims. The hearing officer found no evidence of discrimination with respect to Wise's co-workers. The Board entered a final order affirming the hearing officer's recommended order without amendment. KET appealed to the Franklin Circuit Court which affirmed the Board's order, holding that the Board had jurisdiction over the appeal and that its decision was supported by substantial evidence. The circuit court later entered an order amending its opinion and order regarding matters which are not at issue in this appeal. Additional facts will be set forth below as necessary.
This appeal presents a question of law – whether the Board properly exercised jurisdiction, and a question of fact – whether there was sufficient evidence to support the finding of age discrimination. In reviewing the decision of an administrative agency such as the Board, "[a] reviewing court may not substitute its own judgment on a factual issue ‘unless the agency's decision is arbitrary and capricious.’ " Wasson v. Kentucky State Police , 542 S.W.3d 300, 302 (Ky. App. 2018) (quoting McManus v. Kentucky Retirement Systems , 124 S.W.3d 454, 458 (Ky. App. 2003) ). "Arbitrariness review is limited to the consideration of three basic questions: (1) whether an action was taken in excess of granted powers, (2) whether affected parties were afforded procedural due process, and (3) whether determinations are supported by substantial evidentiary support." Hilltop Basic Resources, Inc. v. County of Boone , 180 S.W.3d 464, 467 (Ky. 2005).
"Once a reviewing court has determined an agency's decision is supported by substantial evidence, the court must then determine if the agency applied the correct rule of law to the factual findings in making its determination. If so, the agency's final order is upheld. However, matters of statutory construction and interpretation are matters of law subject to de novo review." Wasson , 542 S.W.3d at 302-03 (citations omitted).
Chapter 18A of the Kentucky Revised Statutes establishes a system of personnel administration governing classified state employees. See KRS 18A.010(1). In bringing his appeal before the Board, Wise, who was always designated and treated as an unclassified employee, relied on KRS 18A.095(14)(a), which provides that "[a]ny employee, applicant for employment, or eligible on a register, who believes that he has been discriminated against, may appeal to the [B]oard." KRS 18A.095(14)(a).
KET contends that another statute, KRS 18A.115(1)(f), grants KET special discretion to decide which of its employees will be subject to the statutory scheme set forth in Chapter 18A. KRS 18A.115(1) states in pertinent part that "[t]he classified service to which KRS 18A.005 to 18A.200 shall apply shall comprise all positions in the state service now existing or hereafter established," followed by a list of exceptions including "[e]mployees of Kentucky Educational Television who have been determined to be exempt from classified service by the Kentucky Authority for Educational Television, which shall have sole authority over such exempt employees for employment, dismissal, and setting of compensation, up to the maximum established for the executive director and his principal assistants[.]" KRS 18A.115(1)(f).
KET argues that the Personnel Board exceeded its jurisdiction in hearing Wise's appeal because employees of KET are exempted from the classified service by KRS 18A.115(1)(f) and subject to the sole authority of KET in employment matters. Wise counters that KRS 18A.095(14)(a), by referring to "employees" in general, without qualification, encompasses classified and unclassified employees.
"As the proper interpretation of a statute is purely a legal issue, our review is de novo. Our ultimate goal when reviewing and applying statutes is to give effect to the intent of the General Assembly." Kennedy v. Commonwealth , 488 S.W.3d 41, 44 (Ky. App. 2016) (internal quotation marks and citations omitted). "The primary rule is to ascertain the intention from the words employed in enacting the statute and not to guess what the Legislature may have intended but did not express. Resort must be had first to the words, which are decisive if they are clear. The words of the statute are to be given their usual, ordinary, and everyday meaning." Osborne v. Commonwealth , 185 S.W.3d 645, 648-49 (Ky. 2006) (citation omitted). "The statute must be read as a whole and in context with other parts of the law." Lewis v. Jackson Energy Co-op. Corp. , 189 S.W.3d 87, 92 (Ky. 2005).
In reconciling KRS 18A.115(1)(f) and KRS 18A.095(14)(a), the circuit court acknowledged that KRS 18A.115(1)(f) gave KET the authority to exempt employees from classified service. It further found that the legislature intended KRS 18A.095 to apply to all executive branch employees, classified and unclassified. It based this conclusion on the fact that other sections of KRS 18A.095 expressly specify whether they apply to classified or unclassified employees. We agree with the circuit court's interpretation, because "[w]e presume that the General Assembly intended for the statute to be construed as a whole, for all of its parts to have meaning, and for it to harmonize with related statutes." Commonwealth v. Wright , 415 S.W.3d 606, 609 (Ky. 2013) (citation omitted).
KET argues that the legislative history of KRS 18A.115(1)(f), specifically the 1981 report from the Legislative Research Committee for Program Review and Investigation, shows that the legislature intended to remove KET's exempt employees entirely from the Personnel Board's jurisdiction due to KET's special needs as a public broadcaster. It contends that the state personnel system would have hindered both KET's ability to recruit and retain a skilled labor force and its ability to resist the control and influence of other agencies and government officials. KET claims the General Assembly also feared the state personnel system's review of race- and gender-based discrimination claims would prevent KET from complying with federal affirmative action rules, thereby endangering its public broadcasting license.
"Where a statute is unambiguous, there is no need to use extrinsic evidence of legislative intent and public policy[.]" Jackson Energy , 189 S.W.3d at 94. If the General Assembly intended KET's employees to be exempt from the jurisdiction of the Personnel Board in discrimination matters, it would have plainly stated so. As we have already observed, other subsections of KRS 18A.095 clearly specify whether they apply to classified or unclassified employees. This conclusion is further sustained by the General Assembly's enactment of KRS 344.025, which expressly applies to both classified and unclassified employees. It provides that "[n]o provision in KRS Chapter 18A shall be construed to preclude any classified or unclassified state employee from appealing to the personnel board any action alleged to be in violation of laws prohibiting discrimination based on a person's status as a qualified individual with a disability, sex, age, religion, or race or national origin, in accordance with this chapter."
KET argues that its employees occupy a special status, neither classified nor unclassified, akin to University employees or Kentucky State Police employees. In Bryant v. Kentucky State University , No. 85-125, 1986 WL 1174879 (Ky. Pers. Bd. Feb. 28, 1986), an employee of the university who was terminated for cause filed an appeal before the Board. The Board ruled that it did not have jurisdiction over the appeal because the provisions of Chapter 164, which vested exclusive jurisdiction of these cases with the university's Board of Regents, superseded the provisions of the earlier-enacted Chapter 18A. By contrast, there is no separate chapter of the Kentucky Revised Statutes relating to KET employees.
Similarly, in Brumfield v. Justice Cabinet , No. 95-281, 1995 WL 17873408 (Ky. Pers. Bd. Sept. 6, 1995), the Board declined to exercise jurisdiction over an appeal by a Kentucky State Police employee alleging race and sex discrimination in the cadet selection process. Although the Board agreed that KRS 18A.115(1) exempted state troopers and sworn officers from the classified service, it also noted that the KSP Personnel Board held specific authority to hear such matters under KRS 16.050. No similar statute has established a special Personnel Board for KET employees.
On the other hand, Chapter 18A itself contains provisions specifically referencing KET employees. For example, KRS 18A.195(2), which governs compensatory time and payment upon leaving state service, directs that employees listed in KRS 18A.115(1)(f) "shall not be eligible to receive any level of block payment for compensatory leave hours, except as provided in subsection (3) of this section." If KET employees were completely exempted from the terms of Chapter 18A by KRS 18A.115(1)(f), it would be illogical for the Chapter to contain specific provisions pertaining to their compensatory leave hours.
Finally, KET's views on the jurisdiction of the Board have changed significantly since 2010. At the time of Wise's termination, KET held the position that he was subject to Chapter 18A and specifically KRS 18A.095. Wise's dismissal letter of September 10, 2010 informed him that his dismissal was taken without cause and, for that reason, he did not have the right to appeal to the Personnel Board except as provided by KRS 18A.095. The dismissal letter also stated that because he had 18.92 years of service, he might wish to invoke his rights under KRS 18A.130 and KRS 18A.135 by contacting the Personnel Cabinet to be placed on re-employment lists.
The circuit court correctly concluded as a matter of law that the Personnel Board had jurisdiction to hear Wise's appeal.
KET also challenges the adequacy of the evidence supporting the finding that Wise was terminated as the result of age discrimination. "There are two paths for a plaintiff seeking to establish an age discrimination case. One path consists of direct evidence of discriminatory animus. Absent direct evidence of discrimination, [the] [p]laintiff must satisfy the burden-shifting test of McDonnell Douglas Corp. v. Green , 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). The reasoning behind the McDonnell Douglas burden shifting approach is to allow a victim of discrimination to establish a case through inferential and circumstantial proof." Williams v. Wal-Mart Stores, Inc. , 184 S.W.3d 492, 495 (Ky. 2005).
"Under the McDonnell Douglas framework a plaintiff can establish a prima facie case of age discrimination by proving that he or she: (1) was a member of a protected class, (2) was discharged, (3) was qualified for the position from which they were discharged, and (4) was replaced by a person outside the protected class." Id. at 496 (citation omitted).
When, as in this case, a termination is the result of a work force reduction, the fourth element is modified to require the plaintiff to provide "additional direct, circumstantial, or statistical evidence tending to indicate that the employer singled out the plaintiff for discharge for impermissible reasons." Barnes v. GenCorp Inc. , 896 F.2d 1457, 1465 (6th Cir. 1990) (citations omitted).
"Once the plaintiff has established a prima facie case, the burden shifts to the employer to articulate a ‘legitimate nondiscriminatory reason’ for the termination decision. The defendant bears only the burden of production and this involves no credibility assessments." Williams , 184 S.W.3d at 497 (citations omitted).
"After a defendant has provided a legitimate, nondiscriminatory reason for the termination, the McDonnell Douglas framework disappears. At this point, the plaintiff must persuade the trier of fact, by a preponderance of the evidence, that the defendant unlawfully discriminated against [him]. In order to prevail, the plaintiff must typically demonstrate that the employer's stated reason for the termination was merely a pretext, masking the discriminatory motive." Id. (citations omitted).
KET argues that Wise failed to present sufficient evidence, either direct or circumstantial, of age discrimination. The hearing officer's recommended conclusions of law stated as follows:
Patrick J. Wise established a prima facie case of age discrimination. He was 57 at the time he was terminated. He was well-qualified for his position. He established the fourth element by establishing that he possessed superior qualifications to those who were not discharged. Mr. Wise had more experience, his job performance was judged better by his supervisors who observed his work and he was seen as a leader during KET's digital conversion, even training other employees on the new K-2 server. KET articulated a legitimate, non-discriminatory reason for his dismissal; that Mr. Wise was not interested in working on the new digital equipment, and had a bad attitude. Mr. Wise was able to establish that KET's articulated reason for his dismissal was a pretext for age discrimination. The overwhelming evidence in the record was that Mr. Wise was an excellent employee in studio maintenance, considered to be "the top in the shop" and among the best qualified with the best work ethic. The information regarding his disinterest in working on the digital equipment and his bad attitude were alleged primarily to originate with Jim Rous [the Maintenance Supervisor]. Jim Rous denied he ever made those statements to Fred Engel [Senior Director of Technology] or Mike Brower [the Interim Maintenance Supervisor], and Pat Wise denied ever making them to Jim Rous. Based on the Findings of Fact, Mr. Rous and Mr. Wise did not make these statements and Wise was capable and willing to work on the digital equipment. Mr. Wise was the oldest and highest paid member of the Studio Maintenance staff, and his work was superior to younger individuals in the Maintenance staff who were retained. Mr. Wise has established that his termination was the result of illegal age discrimination.
Mr. Wise's claim of age discrimination is also supported by direct evidence in the form of testimony by Craig Cornwell [Director of Production and later Senior Director of Programming] that older workers at KET are seen as set in their ways and resistant to change. This is eerily similar to the reasons articulated by Fred Engel that Mr. Wise had not embraced the digital technology.
KET challenges the Board's conclusion that Craig Cornwell's testimony constituted direct evidence of age discrimination. Cornwell had worked at KET for twenty years, as Director of Production for ten years and then as the Senior Director of Programming. He testified that the Senior Directors were involved in the termination process in 2010. He testified about the differences between younger and older employees, stating that younger employees have a superior knowledge of technology and are interested in achieving and moving up the ladder. Older employees, in his opinion, can present more of a challenge for management because they are more set in their ways and they do not always follow directives. He denied that the Senior Directors focused on age when deciding which employees to terminate.
KET disputes that these comments were direct evidence of age discrimination on the grounds they were made by a non-decisionmaker and were unrelated to the decisional process. KET further contends that because Cornwell's statements were made four years after the 2010 terminations, they were not sufficiently temporally or causally related to the termination to be probative. Furthermore, KET contends that the actual content of the statements about older workers and technology was ambiguous and could not be used to infer that KET terminated Wise due to his age.
Although he was not the sole decisionmaker in Wise's case, Cornwell was a highly-placed member of the senior management team of directors who were responsible for the termination decisions. His testimony was evidence that a senior management figure held stereotypical views of older workers as not being as adept at working with new technology as younger workers, even though substantial evidence was adduced that Wise did adapt successfully to the transition from analog to digital technology. Cornwell's ageist comments were by no means the only evidence or dispositive evidence of age discrimination but they were certainly direct evidence that the employer's explanation for the termination was pretextual.
KET further argues that Wise did not present any "direct, circumstantial, or statistical evidence" that he was singled out for his age as part of the work force reduction. The non-discriminatory reason KET offered for terminating Wise was his negative attitude and lack of interest in working on the new digital equipment. Shae Hopkins, the Executive Director of KET, testified that she understood Wise was added to the list of those to be terminated because he had a bad attitude and unwillingness to work on the new digital equipment.
The negative remarks about Wise came primarily from Fred Engel, who was Senior Director of Technology at KET beginning on May 2, 2010. Although Engel testified that he personally observed Wise not working, his primary information about Wise came from Mike Brower, the Senior Director of Production. According to Brower, Wise sometimes had attitude problems and would not take on new duties without additional pay. According to Engel, Jim Rous, the Maintenance Supervisor, also told him that Wise would not do anything and he could not get work out of him. Engel's impression was that Wise's strength was with the older technology and that he did not get anything out of going to Oregon for training on the new K-2 technology.
Brower testified that Rous told him that when Wise returned from Oregon he was not interested in working on the new server without a pay raise. Brower did not speak directly to Wise about this, however. Brower testified that Rous was in the best position to know about Wise's job performance. When Engel assumed his duties, Brower told him that Wise had an attitude problem and would not take on new duties without additional pay.
Don Dean, KET's Lighting Director, testified that when Brower was in charge of production, younger people were favored to get promotions.
Rous denied that Wise ever said he did not pick anything up in the training on the new server, and he denied that Wise refused to work on digital equipment or demanded more money to do so. According to Rous, the negative comments about Wise probably came from Brower, who served as Interim Supervisor over the Maintenance Section. Rous testified that Brower did not have the technical expertise to assess Wise's work. He said no one had a better work ethic than Wise or could compete with his installation work. He was surprised by Wise's termination, and stated that Wise would have been the last employee he would have recommended firing in his department. No one ever consulted with Rous about Wise's job skills, work performance or ability to work on the digital conversion.
Mike Howard, a Systems Integration Purchasing Specialist who retired in 2008, testified that Wise was involved in the transition from standard definition to high definition, that he was always helpful, that the quality of his work was always very good, that he could do digital work and he never saw any problems with Wise's attitude or work ethic. He stated: "If Pat Wise worked on a project, it would be done right and you knew he would do a good job."
Rick Melton, retired Director of Studio Engineering, testified that Wise was "as good as there is in the shop" and "top of the list." He said Wise's work with the digital conversion compared favorably with others and that he participated fully with the new equipment and Melton had no concerns in that regard. He testified that Rous was in the best position to assess Wise's work.
Prentice Walker, an Operations Technician Principal, testified that younger employees are favored at KET. He stated that he is the oldest one of the crew. He said younger members are more likely to be promoted and get more opportunities.
Doug Campbell was employed as an Engineer in Operations at KET. He testified that Wise could work on digital as well as analog equipment and he had no complaints about Wise's work and felt it was outstanding.
Chuck Burgess, employed at KET as an Audio Operations Technician, testified that Wise was very good at troubleshooting, that he constantly saw him at his bench working, that he was very good at what he did and he never heard any complaints and was shocked when Wise was fired. He also testified that KET favored younger employees and practiced age discrimination. He said younger less-experienced employees were promoted to producers.
In light of the foregoing summary of some of the evidence presented at the hearing, we agree with the circuit court that substantial evidence supported the Board's final order, in part because "[m]ultiple people in supervisory or authority positions deemed Petitioner [Wise] to have been an exemplary employee." "If there is substantial evidence in the record to support an agency's findings, the findings will be upheld, even though there may be conflicting evidence in the record." Kentucky Unemployment Ins. Comm'n v. Cecil , 381 S.W.3d 238, 245-46 (Ky. 2012) (citation omitted). Engel's testimony about Wise's shortcomings, much of it based on observations by Brower and Rous which Rous subsequently denied, is simply not compelling enough to outweigh the substantial evidence that Wise was the victim of age discrimination.
For the foregoing reasons, the Franklin Circuit Court's opinion and order of March 7, 2018, and its order of April 27, 2018, are affirmed.
ALL CONCUR.