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defining termination for cause under Tennessee law in a case arising from the termination of non-tenured employees of Tennessee educational institutions
Summary of this case from Ling v. HerrodOpinion
No. M1997-00223-COA-R3-CV.
Filed January 30, 2001. May 29, 1998 Session.
Appeals from the Chancery Courts for Davidson County Nos. 96-514-I, 96-1134-II, 96-1706-II, 96-3186-I, 96-3391-I 97-458-I(II) Irvin H. Kilcrease Carol L. McCoy, Chancellors.
Affirmed.
Paul G. Summers, Attorney General and Reporter; William J. Marett, Jr., Assistant Attorney General, for the appellants, Charles E. Smith, James A. Hefner, Roy S. Nicks, V. Lane Rawlins, James E. Walker, Arthur Lawson, East Tennessee State University, Middle Tennessee State University, Tennessee State University, and the University of Memphis.
Michele D. Collins, Nashville, Tennessee, for the appellee, Theodore A. Black.
David B. Lyons, Nashville, Tennessee, for the appellee, Joseph Perry.
Larry D. Woods, Nashville, Tennessee, for the appellees, Melvin N. Cason, Julana Croy, George Lawrence, Jr., and Danny J. Leath.
William C. Koch, Jr., J., delivered the opinion of the court, in which Henry F. Todd, P.J., M.S., and William B. Cain, J., joined.
OPINION
During 1997, two chancellors of the Chancery Court for Davidson County heard six cases challenging the decisions of four educational institutions within the State University and Community College System to deny grievance hearings to six non-tenured support personnel who had been terminated between December 1995 and October 1996. The terminations were unrelated, but the grounds for each termination involved the employee's conduct at work or job performance. Each person was employed pursuant to an at-will contract, and each institution had a grievance procedure in place when the terminations occurred. Each employee made a timely request for a grievance hearing, and each of these requests were denied.
Tennessee Bd. of Regents Policy No. 5:01:00:00, General Personnel Policy, § C(2) (Mar. 1993) states that all "[p]ersonnel other than faculty shall be appointed to serve at the pleasure of the president or, at area vocational-technical schools, of the director."
George Lawrence, Jr. had been employed as a roofer at the University of Memphis for approximately nine years. On November 15, 1995, he was informed that he was being suspended for "knowingly violat[ing] University safety policy regarding work in an unsafe manner" and refusing to follow his supervisor's instructions. Thereafter, the Associate Director of Physical Plant and Planning recommended that Mr. Lawrence be terminated because he had been"abusive to his supervisor" and because he had failed to "follow instructions when requested by his supervisor and others to discontinue work that he was performing in an unsafe manner." Accordingly, the University of Memphis terminated Mr. Lawrence effective December 11, 1995, and denied his December 19, 1995 request for a hearing. On February 15, 1996, Mr. Lawrence filed suit in the Chancery Court for Davidson County seeking a hearing and reinstatement. He filed an amended complaint on May 6, 1996, seeking a common-law writ of certiorari to review the process to terminate him.
Danny J. Leath worked as a stock clerk for the University of Memphis for over ten years. He was suspended and then terminated effective February 15, 1996, because a co-worker complained about his job performance. The University of Memphis denied his request for a hearing. Mr. Leath filed suit in the Chancery Court for Davidson County on April 9, 1996, requesting a hearing and reinstatement. On May 6, 1996, he filed an amended complaint seeking a common-law writ of certiorari to review his termination.
Joseph Perry was employed as a security officer at Tennessee State University from 1978 until 1996, except for a brief period during the mid-1990s. In a letter dated October 4, 1996, Tennessee State University requested Mr. Perry to resign because of "misconduct, misuse, behavior and . . . work performance." When Mr. Perry declined, he was notified that he would be terminated effective November 27, 1996. After Tennessee State University denied his request for a hearing, Mr. Perry filed suit in the Chancery Court for Davidson County on February 7, 1997, seeking reinstatement and back pay. On June 6, 1997, Mr. Perry filed an amended complaint seeking a common-law writ of certiorari to review his termination.
Theodore A. Black worked as a security officer at Tennessee State University for over eighteen years. He was terminated on March 13, 1996, because he had been sleeping on the job and had permitted an unauthorized person to enter a restricted area for which he was responsible. Tennessee State University denied Mr. Black's request for a hearing on April 12, 1996, and on June 5, 1996, Mr. Black filed a petition for a writ of certiorari in the Chancery Court for Davidson County seeking review of his termination.
Julana Croy was employed as a library assistant at East Tennessee State University for sixteen years. The University terminated Ms. Croy effective August 13, 1996, because of "a general decline in the quality of [her] performance over the past four evaluation cycles." Specifically, the University cited Ms. Croy's "performance level, . . . interactions with supervisors, peers, and student workers, and . . . erratic attendance." The University denied Ms. Croy's request for a grievance hearing on September 4, 1996. Ms. Croy filed suit in the Chancery Court for Davidson County on October 10, 1996, asserting that her termination violated the Americans With Disabilities Act and demanding reinstatement and back pay. In the alternative, she requested judicial review of her termination under a common-law writ of certiorari.
Melvin N. Cason was employed as a custodian at Middle Tennessee State University for thirteen years. The University terminated him on October 12, 1996, because he had a pizza party at his place of employment, falsified his time card, and inadequately performed his duties as custodian. On October 15, 1996, the University denied Mr. Cason's request for a hearing. On October 29, 1996, Mr. Cason filed a complaint in the Chancery Court for Davidson County seeking a common-law writ of certiorari to review his termination.
The various institutions first attempted unsuccessfully to have these complaints dismissed for lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted. Thereafter, they filed motions for summary judgment. After the trial court threatened to dismiss Mr. Lawrence's case for lack of prosecution, five of the six employees filed cross motions for summary judgment on March 21, 1997. All motions in these five cases were heard on April 25, 1997. On May 12 and 13, 1997, the two chancellors hearing these cases filed essentially identical memorandums. The chancellors concluded that the termination proceedings could not be reviewed as contested cases under the Uniform Administrative Procedures Act but could be reviewed in accordance with a common-law writ of certiorari. The chancellors also concluded that the educational institutions had acted arbitrarily and illegally by terminating each of the five employees because they had denied the employees' requests for a grievance hearing before termination under Tenn. Code Ann. § 49-8-117. Accordingly, the chancellors directed each of the educational institutions to provide the employees with a hearing and pretermitted the employees' requests for back pay. On September 11, 1997, one of the chancellors entered a memorandum and order granting Mr. Perry the same relief that had been granted to the other five employees. The educational institutions appealed from these decisions. On October 30, 1997, we consolidated the six cases for argument and disposition.
In addition to Mr. Lawrence, these employees included Mr. Black, Mr. Cason, Ms. Croy, and Mr. Leath.
I.
The Employees' Right To A Grievance Hearing
The educational institutions assail the trial courts' decisions as making inappropriate inroads into the employment-at-will doctrine. We disagree. The employment-at-will doctrine is part of the essential public policy of this state. Sullivan v. Baptist Mem'l Hosp., 995 S.W.2d 569, 574 (Tenn. 1999); Nelson v. Martin, 958 S.W.2d 643, 647 (Tenn. 1997). Except for circumstances that would give rise to a retaliatory discharge claim, the doctrine permits either an employee or an employer to terminate an employment relationship at any time with or without good cause. Conatser v. Clarksville Coca-Cola Bottling Co., 920 S.W.2d 646, 647 (Tenn. 1995); Forrester v. Stockstill, 869 S.W.2d 328, 330 (Tenn. 1994).
The employment-at-will doctrine may be modified in three ways. First, the parties themselves may limit the application of the doctrine in an employment contract. Abou-Sakher v. Humphreys County, 955 S.W.2d 65, 69-70 (Tenn.Ct.App. 1997). Second, the doctrine may be limited by statute. Anderson v. Standard Register Co., 857 S.W.2d 555, 556 (Tenn. 1993); Voss v. Shelter Mut. Ins. Co., 958 S.W.2d 342, 343-44 (Tenn. Ct. App. 1997). Third, the courts may limit the doctrine in circumstances where a termination of employment would be contrary to well-defined public policy. Stein v. Davidson Hotel Co., 945 S.W.2d 714, 717 (Tenn. 1997); Reynolds v. Ozark Motor Lines, Inc., 887 S.W.2d 822, 823 (Tenn. 1994).
When the General Assembly enacted Tenn. Code Ann. § 49-8-117 in 1993, it modified the employment-will-relationship between the educational institutions in the University of Tennessee system and the State University and Community College System and their "support staff." The statute requires these educational institutions to establish a grievance procedure for their support staff. The grievance procedure must cover employee complaints relating to adverse employment actions, including "termination for cause." Tenn. Code Ann. § 49-8-117(b)(2)(A). The statute also requires that any support employee filing a grievance regarding a termination for cause "shall receive a hearing covered under the provisions of the Tennessee Uniform Administrative Procedures Act."
For the purpose of this statute, "support staff" refers to employees who are neither faculty nor executive, administrative, nor professional staff. Tenn. Code Ann. § 49-8-117(a)(2).
The other employment actions included in the grievance procedure include: demotions, suspensions without pay, and work assignments or working conditions which violate statute or policy. Tenn. Code Ann. § 49-8-117(b)(2)(A), (B).
Tenn. Code Ann. § 49-8-117(b)(3) also extends contested case status to grievances regarding demotions or suspensions without pay.
The parties agree that all six employees involved in these proceedings were support personnel for the purpose of Tenn. Code Ann. § 49-8-117. However, the educational institutions and their former employees disagree about the scope of the term "termination for cause." The educational institutions insist that "terminations for cause" are limited to terminations for acts of serious misconduct and that terminations for any other performance-related reason are not "terminations for cause" and are, therefore, not included within the statutorily-mandated grievance procedures. They assert that "terminations for cause" only include terminations for "any intentional wrongful acts of omission or conduct that evidences a wanton disregard for the policies of the University, Board of Regents, or federal/state law or regulation." As examples of the sort of misconduct that warrants a termination for cause, the educational institutions cite stealing, threatening the life or well-being of others, falsification of records or reports, abuse of computer systems, work-related conduct that would subject the employee to criminal prosecution, reporting for duty under the influence of intoxicants, or "other similar acts involving intolerable behavior by the employee."
University of Memphis Operating Procedures No. 2D:05:04A, art. IV, ¶ A. It should be noted that the policies of East Tennessee State University, Middle Tennessee State University, and Tennessee State University do not contain a definition of misconduct similar to the one found in the University of Memphis's policies.
Tennessee Bd. of Regents Policy No. 5:01:00:00, General Personnel Policy, § E(4).
The General Assembly did not define the phrase "termination for cause" in Tenn. Code Ann. § 47-8-117(b)(2)(A). Accordingly, it falls to us to determine what this phrase means. The search for the meaning of statutory text is a judicial function. Roseman v. Roseman, 890 S.W.2d 27, 29 (Tenn. 1994); State ex rel. Weldon v. Thomason, 142 Tenn. 527, 540, 221 S.W. 491, 495 (1920). We must ascertain and then give the fullest possible effect to the statute without unduly restricting it or expanding it beyond its intended scope. Perry v. Sentry Ins. Co., 938 S.W.2d 404, 406 (Tenn. 1996); Kultura, Inc. v. Southern Leasing Corp., 923 S.W.2d 536, 539 (Tenn. 1996).
The courts must also presume that the General Assembly says in a statute what it means and means what it says there. Berryhill v. Rhodes, 21 S.W.3d 188, 195 (Tenn. 2000); Worley v. Weigels, Inc., 919 S.W.2d 589, 593 (Tenn. 1996). Accordingly, we construe statutes as they are written, Jackson v. Jackson, 186 Tenn. 337, 342, 210 S.W.2d 332, 334 (1948), and our search for the meaning of statutory language must always begin with the statute itself. Neff v. Cherokee Ins. Co., 704 S.W.2d 1, 3 (Tenn. 1986); Pless v. Franks, 202 Tenn. 630, 635, 308 S.W.2d 402, 404 (1957); City of Nashville v. Kizer, 194 Tenn. 357, 364, 250 S.W.2d 562, 564-65 (1952). At the same time, we must avoid inquiring into the reasonableness of the statute or substituting our own policy judgments for those of the General Assembly. State v. Grosvenor, 149 Tenn. 158, 167, 258 S.W. 140, 142 (1924); Hamblen County Educ. Ass'n v. Hamblen County Bd. of Educ., 892 S.W.2d 428, 432 (Tenn.Ct.App. 1994).
Statutory terms draw their meaning from the context of the entire statute, Lyons v. Rasar, 872 S.W.2d 895, 897 (Tenn. 1994), and from the statute's general purpose. City of Lenoir City v. State ex rel. City of Loudon, 571 S.W.2d 297, 299 (Tenn. 1978); Loftin v. Langsdon, 813 S.W.2d 475, 478 (Tenn.Ct.App. 1991). The words and phrases used in a statute should be given their natural and ordinary meaning, State ex rel. Metro. Gov't v. Spicewood Creek Watershed Dist., 848 S.W.2d 60, 62 (Tenn. 1993), unless the legislature used them in a specialized, technical sense. See Cordis Corp. v. Taylor, 762 S.W.2d 138, 139-40 (Tenn. 1988).
The legislative process does not always produce precisely drawn laws. When the words of a statute are ambiguous or when it is just not clear what the General Assembly had in mind, courts may look beyond a statute's text for reliable guides to the statute's meaning. We may consider the statute's historical background, the conditions giving rise to the statute, and the circumstances contemporaneous with the statute's enactment. Still v. First Tenn. Bank, N.A., 900 S.W.2d 282, 284 (Tenn. 1995); Mascari v. Raines, 220 Tenn. 234, 239, 415 S.W.2d 874, 876 (1967); Davis v. Aluminum Co. of Am., 204 Tenn. 135, 143, 316 S.W.2d 24, 27 (1958). We also consult the statute's legislative history, including the statements of the statute's sponsors during the legislative debates. Storey v. Bradford Furniture Co., 910 S.W.2d 857, 859 (Tenn. 1995); University Computing Co. v. Olsen, 677 S.W.2d 445, 447 (Tenn. 1984). However, we must guard against placing inappropriate emphasis on a sponsor's explanations. These comments cannot alter the plain meaning of a statute. D. Canale Co. v. Celauro, 765 S.W.2d 736, 738 (Tenn. 1989); Elliott Crane Serv., Inc. v. H.G. Hill Stores, Inc., 840 S.W.2d 376, 379 (Tenn.Ct.App. 1992). Thus, we should decline to adopt an interpretation based solely on legislative history that does not have textual support. BellSouth Telecomm., Inc. v. Greer, 972 S.W.2d 663, 674 (Tenn.Ct.App. 1997).
The lack of a statutory definition of "termination for cause" leaves us without a clear impression of what the General Assembly had in mind. The legislative debates provide some assistance. The legislation was considered by the Senate Education Committee on April 7, 1993. During this hearing, the bill's Senate sponsor, Senator Jim Kyle of Memphis, and representatives of the State University and Community College System and the Tennessee State Employees Association discussed the provision that would later become Tenn. Code Ann. § 49-8-117(b)(3). The representative of the Tennessee State Employees Association asserted that employees who were terminated for "unsatisfactory work performance" would be entitled to a full contested case hearing of their grievance. She was not contradicted by the bill's sponsor, any other member of the committee, or the representative of the State University and Community College System. This discussion provides some basis for suspecting that the scope of the term "termination for cause" is broader than the meaning suggested by the educational institutions in this case.
The Tennessee State Employees Association's understanding of the scope of "termination for cause" is borne out by court decisions construing similar terms in the private employment context. Cause exists only where the termination is objectively reasonable. Video Catalog Channel, Inc. v. Blackwelder, No. 03A01-9705-CH-00155, 1997 WL 581120, at *3 (Tenn.Ct.App. Sept. 19, 1997) (No Tenn.R.App.P. 11 application filed). The types of "cause" that warrant an employee's termination include an employee's inattention to his or her duty to look after the employer's best interests or performance of an action inconsistent with the employer-employee relationship. Nelson Trabue, Inc. v. Professional Mgmt.-Auto., Inc., 589 S.W.2d 661, 663 (Tenn. 1979); Smith v. Signal Mountain Golf Country Club, No. 03A01-9309-CV-00334, 1994 WL 85949, at *2 (Tenn.Ct.App. Mar. 9, 1994) perm. app. denied (Tenn. July 25, 1994); Wyatt v. Brown, 42 S.W. 478, 481 (Tenn.Ch.App. 1897). Any action by an employee that injures or tends to injure the employer's "business, interests, or reputation will justify . . . dismissal. Actual loss is not essential; it is sufficient if, from the circumstances, it appears that the [employer] has been, or is likely to be, damaged by the acts of which complaint is made." Brewer v. Coletta, No. 02A01-9601-CH-00005, 1996 WL 732429, at *3 (Tenn.Ct.App. Dec. 20, 1996) (No Tenn.R.App.P. 11 application filed); Curtis v. Reeves, 736 S.W.2d 108, 112 (Tenn.Ct.App. 1987).
We have concluded that an employee has been terminated for cause if the employee's termination stems from a job-related ground. Miller v. Citizens' State Bank, 830 P.2d 550, 552 (Mont. 1992). A job-related ground includes any act that is inconsistent with the continued existence of the employer-employee relationship. Lee-Wright, Inc. v. Hall, 840 S.W.2d 572, 580 (Tex.App. 1992). Thus, an employee has been terminated for cause if the termination stems from the employee's failure to follow a supervisor's directions, Prenger v. Moody, 845 S.W.2d 68, 77 (Mo.Ct.App. 1992), poor job performance, or failure in the execution of assigned duties. Pepe v. Rival Co., 85 F. Supp.2d 349, 386 n. 14 (D.N.J. 1999). In contrast, an employee who has been terminated as part of a bona fide reduction in force has not been terminated for cause because the reason for the termination is unrelated to the employee's job performance. Caldwell v. Ford, Bacon Davis Utah, Inc., 777 P.2d 483, 486 (Utah 1989).
We have reviewed the records regarding each of the six terminated employees in this case. Each termination stemmed from the employee's performance of his or her duties. Thus, each of the terminations are "terminations for cause" for the purpose of Tenn. Code Ann. § 49-8-117(b)(2)(A), -(B)(3). Accordingly, each employee is entitled to grieve his or her discharge, and if an employee grieves his or her discharge, the employee is entitled to a contested case hearing under the Uniform Administrative Procedures Act. Accordingly, we affirm the trial courts' interpretation of Tenn. Code Ann. § 49-8-117.
II.
The Proper Procedure for Judicial Review
The employees' complaints reflect some uncertainty regarding the cause or causes of action most suited to obtain judicial relief. The employees who filed the earliest complaints, Messrs. Lawrence and Leath, originally requested immediate reinstatement, a grievance hearing, and back pay under 42 U.S.C. § 1983. On May 6, 1996, their lawyer amended their complaints to add a claim for judicial review through a common-law writ of certiorari. Mr. Black, Mr. Cason, and Ms. Croy, who filed their complaints after May 6, 1997, included a claim for judicial review through a common-law writ of certiorari in their original complaints. Four months after Mr. Perry originally filed his complaint, he filed an amended complaint seeking judicial review under the Uniform Administrative Procedures Act and through a common-law writ of certiorari.
Both trial courts eventually determined that each employee was seeking judicial review of the educational institution's decision under the Uniform Administrative Procedures Act and by a common-law writ of certiorari. They also determined that review in accordance with Tenn. Code Ann. § 4-5-322 was not available because none of the educational institutions had actually provided the discharged employee with a contested case hearing. However, both courts concluded that the employees were entitled to judicial review of the educational institutions' decisions through a common-law writ of certiorari.
Based on the trial courts' decision that the common-law writ of certiorari was the only avenue of judicial review available to the employees, Tennessee State University and the University of Memphis argue that Messrs. Lawrence, Leath, and Perry are not entitled to judicial relief because their petitions were filed too late. There can be no doubt that the ninety-day time limit in Tenn. Code Ann. § 27-9-102 (2000) is mandatory and jurisdictional. Thandiwe v. Traughber, 909 S.W.2d 802, 804 (Tenn.Ct.App. 1994); Wheeler v. City of Memphis, 685 S.W.2d 4, 6 (Tenn.Ct.App. 1984). However, the failure of Messrs. Lawrence, Leath, and Perry to seek a common-law writ of certiorari within ninety days after their termination is not fatal to their efforts to obtain judicial review of their terminations because they are, in fact, entitled to judicial review under the Uniform Administrative Procedures Act.
The Uniform Administrative Procedures Act permits persons aggrieved by an agency's final decision in a "contested case" to seek judicial review. Tenn. Code Ann. § 4-5-322(a)(1); Moser v. Department of Transp., 982 S.W.2d 864, 865 (Tenn.Ct.App. 1998). This method of review permits the courts to reverse or modify an agency decision that prejudices the rights of the petitioner because the decision is, among other things, "[i]n violation of constitutional or statutory provisions," Tenn. Code Ann. § 4-5-322(h)(1), or "[i]n excess of the statutory authority of the agency." Tenn. Code Ann. § 4-5-322(h)(2). A "contested case" is a proceeding where "the legal rights, duties or privileges of a party are required by any statute or constitutional provision to be determined by an agency after an opportunity for a hearing." Tenn. Code Ann. § 4-5-102(3) (1998).
Courts may also judicially review a "preliminary, procedural or intermediate agency action or ruling if review of the final agency decision would not provide an adequate remedy," Tenn. Code Ann. § 4-5-322(a)(1).
The trial courts determined that they lacked jurisdiction to review the employees' terminations under Tenn. Code Ann. § 4-5-322(a)(1) because the educational institutions had not afforded the employees with a contested case hearing. This conclusion rested on a misreading of this court's opinion in Mid-South Indoor Horse Racing, Inc. v. Tennessee State Racing Comm'n, 798 S.W.2d 531, 537 (Tenn.Ct.App. 1990). As we recently pointed out, the Mid-South opinion did not hinge on the fact that there was no contested case hearing before the agency, but rather on the fact that no hearing was statutorily or constitutionally required. Morris v. Correctional Enterprises of Tenn., No. 01A01-9612-CH-00543, 1997 WL 671988, at *4 (Tenn.Ct.App. Oct. 29, 1997) (No Tenn.R.App.P. 11 application filed). If the Uniform Administrative Procedures Act requires a hearing, then the courts may review the agency's decision regardless of whether a hearing was held. Thus, the courts may review an agency's final decision on whether an employee's complaint is grievable, even if the agency did not hold a hearing on the subject. Moser v. Department of Transp., 982 S.W.2d at 866.
To hold otherwise would produce the nonsensical result that an agency decision not to give a hearing would preclude judicial review of the agency decision not to give a hearing.
We have already determined that the support staff are entitled to a contested case hearing under the Uniform Administrative Procedures Act pursuant to Tenn. Code Ann. § 49-8-117. Accordingly, all six of the proceedings involved with this appeal should have been treated as "contested cases" for the purpose of invoking judicial review under Tenn. Code Ann. § 4-5-322. The educational institutions' decisions not to give the employees a hearing does not preclude judicial review under Tenn. Code Ann. § 4-5-322. Therefore, the failure the Messrs. Lawrence, Leath, and Perry to file a petition for writ of certiorari within the time limits required by Tenn. Code Ann. § 27-9-102 does not prevent them from seeking and obtaining judicial review.
All six terminated employees filed their original complaints within sixty days of the defendants' decision to deny a grievance hearing and, as a consequence, judicial review pursuant to Tenn. Code Ann. § 4-5-322(a)(1) is not time-barred. See Tenn. Code Ann. § 4-5-322(b)(1).
III.
Our decision is limited solely to the right of these support employees to a post-termination grievance hearing. Thus, our opinion should not be read to reflect on the adequacy of the grounds the four educational institutions have to terminate these employees. We affirm the judgments in each of these six cases and remand the cases to their respective trial courts for whatever further proceedings may be required. We tax the costs of this appeal to the State University and Community College System for which execution, if necessary, may issue.