Opinion
No. 93A02-9911-EX-765.
September 14, 2000.
APPEAL FROM THE REVIEW BOARD OF THE INDIANA DEPARTMENT OF WORKFORCE DEVELOPMENT Cause No. 9924-7099-R-615
PATRICK B. MCEUEN, Singleton Crist Austgen Sears, Munster, Indiana ATTORNEY FOR APPELLANT.
KAREN M. FREEMAN-WILSON, Attorney General of Indiana, ATTORNEYS CHRISTOPHER L. LAFUSE, Deputy Attorney General,Indianapolis, Indiana FOR APPELLEE.
THOMAS PIERCE, Gary, Indiana, APPELLEE PRO SE.
OPINION — FOR PUBLICATION
Thomas Pierce's employment was terminated by Stanrail Corporation and he thereafter applied for unemployment benefits. An intake examiner and later an administrative law judge (ALJ) determined that Pierce was terminated for just cause, and he was thereby denied unemployment benefits. Pierce appealed to the Unemployment Insurance Review Board (the Board), which reversed the ALJ and held that Pierce was not terminated for just cause, and he therefore was entitled to unemployment benefits. We address the following issue, which is dispositive of the appeal:
Did the Board err in concluding that Pierce was not terminated for just cause?
We reverse.
Pierce was an employee at Stanrail. Stanrail's attendance program was published in a handbook and distributed to all employees. Following is a brief description of relevant components of that policy. On a yearly basis, each employee was entitled to (1) five sick days, (2) two personal business days, (3) two three-day (at a minimum) illness leaves, and (4) accrued vacation days. The program rewarded perfect attendance with a monthly bonus and penalized absence, tardiness, and misconduct with a system of demerit points, which included the following:
Infraction Demerit points
Failing to punch time card 25 Tardy
0-6 minutes 10
7-12 minutes 20
13-18 minutes 40
19 + minutes
sent home (manager's decision) 100 stay (manager's decision) 50
Early quit 3.5 or more hours 100
less than 3.5 hours
1st and 2nd early quit 25 3rd early quit 50 after 3rd early quit 100
Unexcused absence 100 Absent without reporting 300 Failure to wear safety glasses 50
Inappropriate use of forklift 50
General safety violations 50
Horseplay 50
Careless equipment/material damage 50
Deliberate equipment/material damage 300Record at 49-50. With respect to reporting absences, the manual instructed the employees as follows:
You MUST CALL OFF every day you are absent. (exception: you are on scheduled Vacation, approved Leave of Absence, Workman's Compensation, or Hospitalization your supervisor is aware of) You are to TALK TO A SUPERVISOR [afternoon shift] or LEAVE THE INFORMATION WITH THE GUARD [morning shift]. You are NOT to give the information to the Switchboard.Record at 51 (emphasis in original). As reflected above, failure to adhere to the call-in policy subjected an employee to 300 demerit points for being absent without reporting. An employee accumulating more than 500 demerit points was subject to immediate termination.
On January 5, 1999, Pierce missed work, but reported his absence according to the specified procedure. He was assessed 100 demerit points. Pierce was also absent on January 6, but failed to call in. Therefore, he was assessed 300 demerit points. On January 7, Pierce was again absent. On that day, he called to report his absence, but spoke only with someone who worked on the switchboard. He could not later recall the name of the person to whom he had reported. Because he did not adhere to the guidelines for calling in absences, Pierce received 300 demerit points. Pierce was terminated as a result of accumulating more than 500 demerit points after his January 6 and 7 absences.
It appears that on January 8, Pierce was again absent without reporting, for which he would have received another 300 demerit points. This absence apparently was not a factor in the proceedings before the deputy, the ALJ, and the Board, because Pierce was terminated for having accumulated 600 points as a result of being absent without calling in on January 6 and 7.
Pierce applied for unemployment benefits. A deputy determined that Pierce was terminated for just cause. That decision was appealed to an ALJ, who affirmed the denial of benefits. The ALJ entered the following conclusions in support of the decision:
From the foregoing findings, it is concluded that the claimant was discharged from his employment with this employer. It is concluded that the claimant was discharged for a violation of the employer's demerit program concerning attendance. It is concluded that the attendance program is enforced with all employees on a uniform basis. According to I.C. 22-4-15-1(d)(2) a discharge for just cause is defined to include but not to be limited to a knowing violation by an employee of a reasonable and uniformly enforced rule of the employer concerning attendance. Therefore, it is concluded that the claimant was discharged for just cause within the meaning and intent of I.C. 22-4-15-1.Record at 6. Pierce appealed the ALJ's decision to the Board. The Board reversed, entering the following conclusions:
In a discharge case, the Employer bears the burden of proving that it discharged the Claimant for just cause as that term is defined in Indiana Code § 22-4-15-1 (d). Russell v. Review Board, 58[6] N.E.2d 942 (Ind.Ct.App. 1992). In Barnett v. Review Board, 419 N.E.2d 249 (Ind.Ct.App. 1981), the Court held that the Review Board must make certain specific findings in cases involving a discharge for violating an employer's rules. To find that a discharge was for just cause, there must first be a finding 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. A reasonable attendance policy would allow exemptions for long-term absences for illness and verified emergencies as well as provide for progressive discipline prior to discharge. Beene v. Review Board, 528 N.E.2d 842 (Ind.Ct.App. 1988).
This policy is unreasonable. Except for the two personal days a year and three days or more of absence with a doctor's slip, there were no unexcused absences under the policy. Court appearances of any kind are listed as "non-excused" absence. This unexcused absence category would apparently include jury duty which is a legally protected obligation. These deficiencies render the policy unreasonable.Record at 9. Stanrail appeals the decision of the Board.
Oral argument was held before this court in Indianapolis, Indiana on August 1, 2000.
Our task when reviewing a decision by the Board is to determine whether the decision is reasonable in light of its findings. Kentucky Truck Sales, Inc. v. Review Bd. of Indiana Dep't of Workforce Dev., 725 N.E.2d 523 (Ind.Ct.App. 2000). Generally, the Board's findings of fact are conclusive and binding upon this court. Accordingly, we neither reweigh evidence nor assess witness credibility. Browning-Ferris Indus. v. Review Bd. of Indiana Dep't of Workforce Dev., 693 N.E.2d 1351 (Ind.Ct.App. 1998). We are not, however, bound by the Board's interpretation of the relevant law. Rather, we determine de novo whether the Board correctly interpreted and applied the law. Kentucky Truck Sales, Inc. v. Review Bd. of Indiana Dep't of Workforce Dev., 725 N.E.2d 523.
Stanrail contends that because it terminated Pierce's employment for just cause, he is not entitled to unemployment insurance benefits. Ind. Code Ann. § 22-4-15-1(d)(2) (West Supp. 1999) provides that an employer has just cause to terminate an employee for the "knowing violation of a reasonable and uniformly enforced rule of an employer." Initially, the employer bears the burden of establishing that an employee has been terminated for just cause. Browning- Ferris Indus. v. Review Bd. of Indiana Dep't of Workforce Dev., 693 N.E.2d 1351. "In order to make out a prima facie case of termination for just cause under IC 22-4-15-1(d)(2), the employer must show that the former employee: (1) knowingly violated; (2) a reasonable; and (3) uniformly enforced rule." Id. at 1353.
Stanrail presented undisputed evidence that Pierce did not report to work on January 6 and did not call. It also presented undisputed evidence that Pierce did not show up for work on January 7, and did not call and inform his supervisor that he would be absent that day. Pierce does not dispute Stanrail's assertion that Pierce knew of the Stanrail policy that required him to communicate directly with his supervisor to inform the supervisor that Pierce would not be at work on January 7. Similarly, Pierce does not dispute the reasonableness of the rule requiring that he report absences directly to his supervisor. Finally, Pierce does not dispute that the rule was uniformly enforced.
Notwithstanding the fact that Stanrail's evidence seemingly established the elements necessary to prove termination for just cause, the Board reversed the ALJ and ruled in favor of Pierce. In so doing, the Board did not disturb the deputy's and ALJ's findings that Stanrail had established the elements of termination for just cause. Rather, the Board broadened the scope of its inquiry beyond the rule upon which Pierce's termination was based. After conducting this broadened examination, the Board concluded that Stanrail's employment policies were deficient in other respects not pertinent to the basis of Pierce's termination, and that these deficiencies rendered the entire policy unreasonable.
The parties invite this court to take this opportunity to resolve a seeming conflict highlighted by the Board's decision. According to the parties, both Jeffboat, Inc v. Review Bd. Of Ind. Employment Sec. Div., 464 N.E.2d 377 (Ind.Ct.App. 1984) and Love v. Heritage House Convalescent Ctr., 463 N.E.2d 478 (Ind.Ct.App. 1983) are precedent for resolving this appeal, but each compels a different result. Even assuming the parties are correct with respect to the conflicting nature of the holdings in Jeffboat and Love, we must decline the invitation to resolve the conflict. We hold that the Board erred in broadening its inquiry beyond the specific rule that was cited as the basis for Pierce's termination. Applying that principle in the instant case, in order to resolve this appeal, we need not look beyond the rule requiring Stanrail employees to call and inform their supervisor or the guard shack that they are going to be absent from work that day.
IC § 22-4-15-1(d)(2) indicates that a knowing violation of an employer's reasonable and uniformly enforced rule concerning absenteeism may serve as the basis for discharging an employee for just cause, thereby rendering him or her ineligible for unemployment compensation benefits. Jeffboat, Inc. v. Review Bd. of Indiana Employment Sec. Div., 464 N.E.2d 377. If such a rule is cited as the reason for discharge, then the Board must confine its inquiry to that particular rule, and must determine whether, with respect to that rule, the employer has established the elements required to prove termination for just cause just, as set out in IC § 22-4-15-1(d)(2). Parkison v. James River Corp., 659 N.E.2d 690 (Ind.Ct.App. 1996). In this case, the Board erred in going beyond the stated reason for discharge and taking the opportunity to review all facets of Stanrail's employment policies. We will therefore determine whether, considering only the rule in question, Stanrail established that Pierce was terminated for just cause.
Pierce does not dispute the following facts: (1) He was absent on January 6 and did not call in, (2) he was absent on January 7 and did not call and speak with his supervisor to inform him that Pierce would not be at work that day; instead, Pierce called and gave the information to someone working at the switchboard, (3) Stanrail's policy required employees such as Pierce, who worked the afternoon shift, to call the employee's supervisor and inform the supervisor directly that the employee would not be at work that day, or else the employee would receive 300 demerit points, (4) a call to the switchboard informing Stanrail's switchboard personnel that the employee would be absent did not comply with (3) above, and would subject the employee to 300 demerit points, (5) Pierce knew of the Stanrail employment rules set out in (3) and (4) above, and (6) the rules set out in (3) and (4) above were uniformly applied.
Based upon the foregoing, we agree with the decisions of the deputy and the ALJ that Pierce was terminated for just cause because he accumulated more than 500 demerit points for failing to report for work on January 6 and 7 of 1999, without calling and informing his supervisor that he would be absent. The judgment of the Board is reversed.
Judgment reversed.
NAJAM, J., concurs.
MATHIAS, J., concurring with separate opinion.
I concur in this opinion because of the procedural posture of this case and the proper standards of review for both the Board and this Court on appeal.
Counsel ably pointed out the conflict between this Court's previous analyses in Jeffboat, Inc. v. Review Board, 464 N.E.2d 377 (Ind.Ct.App. 1983), and Love v. Heritage House, 464 N.E.2d 377 (Ind.Ct.App. 1984). However, counsel, the Board and this Court have, as of yet, failed to address the source of this recurring, apparent conflict: the merger of "just cause" reviews of I.C. 22-4-15-1(d)(2) rules and I.C. 22-4-15-1 (d)(3) rules. "No fault" discipline policies tend to erase the distinction between these two subsections, which are written in the disjunctive, causing confused results. Until "no fault" absenteeism policies under I.C. 22-4-15-1(d)(3) are reviewed for reasonableness underLove, independent of non-absenteeism rules under I.C. 22-4-15-1-(d)(2), the artificial conflict between the Jeffboat and Love results will persist.
In this case, the record indicates that an employee was dismissed pursuant to his employer's attendance policy when he failed to call in the fact that he was going to be absent on two days. The employee then sought unemployment compensation. Under the Unemployment Insurance Act ("Act"), an employee can be terminated for "just cause," and lose unemployment compensation through the "knowing violation of a reasonable and uniformly enforced rule of an employer." Ind. Code § 22-4-15-1(d)(2). Here the Court of Appeals held that it had been reasonable for the employer to dismiss the employee for not calling in the fact that he was going to be absent. Stanrail Corp. vs. Unemployment Insurance Review Board, 734 N.E.2d 1102 (Ind.Ct.App. 2000).
This determination by the Court of Appeals appears to have been correct and I would affirm it. However, I would grant transfer to address an issue in this case identified by the Unemployment Insurance Review Board ("Board").
The rule under which the employee was terminated here was a "no-fault" attendance policy maintained by his employer. The policy assigned a certain number of demerit points to various types of attendance violations; when a minimum number of demerit points are accumulated, a specified sanction is imposed. An employee accumulating more than 500 demerit points was subject to immediate termination. Here 100 demerit points were assigned whenever an employee missed work for whatever reason and 300 demerit points were assigned for being absent without reporting. On an annual basis, each employee was entitled to five sick days, two personal business days, two periods of three or more days for illnesses requiring medical treatment, and accrued vacation days. Under the policy, an employee could accumulate sufficient demerits to be discharged simply by being sick on more than five (non-consecutive) days through no fault of his or her own.
The Board believes that violations of such "no-fault" attendance policies do not constitute "just cause" for termination under the Act. The Board contends that the purpose of the Act is to provide payment to persons unemployed through no fault of their own and that the effect of denying benefits to persons dismissed for violating no-fault attendance policies is to deny benefits to persons who miss work through no fault of their own.
The Legislature has declared it to be the public policy of the State "to provide for payment of benefits to persons unemployed through no fault of their own." Indiana Code § 22-4-1-1. I believe we should grant transfer to make clear that benefits cannot be denied to an employee dismissed for absence due to legitimate illness where the attendance rule at issue does not provide sufficient time off for legitimate illness. To do otherwise denies benefits to persons who miss work through no fault of their own in contravention of the Unemployment Insurance Act.
However, as noted at the outset, I agree that the employee here is not entitled to relief. While the Unemployment Insurance Review Board believed the employer's attendance policy was unreasonable in that it did not allow employees sufficient time off for legitimate illnesses, the employee terminated here was not the victim of the no-fault provision: he was at fault for not reporting in as required.
BOEHM, J., concurs.