Branch v. Virginia Employment Commission & Virginia Chemical Co.

249 S.E.2d 180, 219 Va. 609, 1978 Va. LEXIS 220

• Court: Supreme Court of Virginia
• Decided: November 22, 1978
• Docket: Record 770306
• Status: Published

Opinions

POFF, J.,

delivered the opinion of the Court.

By decision dated June 16, 1976, the Virginia Employment Commission affirmed the Appeals Examiner’s denial of a claim for unemployment compensation filed by Vernon Branch, Jr., sub nomine Vernon L. Prayer. The Commission found that claimant’s employer, Virginia Chemical Company, had “promulgated a policy to all employees that any employee receiving three garnishees [sic] within twelve months of each other is automatically terminated”; that claimant had “deliberately violated” that policy; and that “his discharge was for misconduct in connection with his work.” By final judgment order entered upon appeal November 5, 1976, the trial court ruled that the findings of the Commission were supported by the evidence and affirmed the Commission’s decision.

We granted claimant a writ of error to consider two issues: first, whether the Commission erred in applying the rule that “where an employee permits excessive and multiple garnishments to be issued against his wages in violation of a company rule, such sufferance constitutes . .. misconduct within the contemplation of an unemployment compensation statute”; and second, whether the Commission’s finding that claimant had violated the company rule was supported by the evidence.

The Virginia Unemployment Compensation Act, Title 60.1, Code of Virginia, requires employers to finance a fund to pay benefits to employees who have become unemployed through no fault of their own. An employee is “disqualified for benefits ... if the Commission finds ... [he] is unemployed because he has been discharged for misconduct connected with his work.” Code § 60.1-58(b) (Repl. Vol. 1973).

This is the first occasion we have had to construe this language in the statute. In our view, an employee is guilty of “misconduct connected with his work” when he deliberately violates a company rule reasonably designed to protect the legitimate business interests of his employer, or when his acts or omissions are of such a nature or so recurrent as to manifest a willful disregard of those interests and the duties and obligations he owes his employer. See generally, 76 Am. Jur.2d Unemployment Compensation § 52 (1975). Absent circumstances in mitigation of such conduct, the employee is “disqualified for benefits”, and the burden of proving mitigating circumstances rests upon the employee. See Western Electric v. Review Bd. of Ind. Emp. Sec. Div., 147 Ind. App. 645, 263 N.E.2d 184 (1970).

The record shows that claimant was familiar with the company rule; that he was repeatedly warned that it would be invoked; and that he offered no evidence in mitigation of its breach. On appeal, he argues that the conduct underlying the breach was not conduct “connected with his work” and, therefore, was not “misconduct” within the intendment of the statute. In several cases entailing similar facts, the Commission has ruled otherwise, see, e. g., Solomon Black v. Airport Transport, Inc., of Virginia, Commission Decision No. 4074-C (July 25, 1963), and when it appears that the General Assembly has acquiesced in the Commission’s construction of the statute, “such construction is entitled to great weight with the courts.” Dan River v. Unemployment Comm., 195 Va. 997, 1002, 81 S.E.2d 620, 623 (1954).

We believe the Commission’s construction is substantially correct. Ordinarily, the way an employee manages his debts is a personal and private matter unconnected with his work. It is a different matter, however, when he mismanages his debts in a manner which impairs the status or function of the employer-employee relationship to the employer’s detriment. When an employee forces his creditors to garnish his earnings, he exposes his employer to continuing service of judicial process, complicates his administrative burden, and increases the cost of conducting his business. Moreover, when the employer withholds a portion of a paycheck, the depressing effect on employee morale tends to erode the quality of the work product.

We are of opinion that the conduct of an employee which results in garnishment is conduct connected with his work and where, as here, such conduct is recurrent,

* knowingly violative of a company rule, and unexcused by mitigating circumstances, it constitutes misconduct within the intendment of the statute. With respect to the first issue, then, we find no error below.

The judgment will be reversed, however, because it appears from the face of the record that the evidence did not support the Commission’s finding that claimant had violated the company rule.

That rule authorized termination of employees who suffered three garnishments “within 12 months of each other”. While this wording arguably supports more than one interpretation, the rule must be construed most strictly against its author and most liberally in favor of the employee. Three garnishments may fairly be said to be “within twelve months of each other” when the third occurs within twelve months of the first. From the testimony of the employer’s manager of employee relations, the Commission found that “[t]he employer was required to garnish the claimant’s wages on August 27, 1974, July 24, 1975, and January 6, 1976.” The Commission then found that “this claimant deliberately violated a company policy”. The first finding, based upon the only evidence touching the question, was correct. But, since the third garnishment occurred nearly 17 months after the first, the second finding was patently incorrect. The factual findings of the Commission are binding in judicial proceedings only when “supported by evidence”. Code § 60.1-67 (Repl. Vol. 1973).

The trial court erred in holding that the factual finding upon which the Commission rested its decision was supported by the evidence. The November 5, 1976 judgment order will be reversed and the case will be remanded. The trial court will enter a new order vacating its judgment and remanding the case to the Commission for further proceedings not inconsistent with this opinion.

Reversed and remanded.

“No employer may discharge any employee by reason of the fact that his earnings have been subjected to garnishment for any one indebtedness.” Code § 34-29(f) (Cum. Supp. 1978).