Isayeva v. Employment Department

340 P.3d 82, 266 Or. App. 806, 2014 Ore. App. LEXIS 1536
CourtCourt of Appeals of Oregon
DecidedNovember 13, 2014
Docket12AB2594; A152848
StatusPublished

This text of 340 P.3d 82 (Isayeva v. Employment Department) is published on Counsel Stack Legal Research, covering Court of Appeals of Oregon primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Isayeva v. Employment Department, 340 P.3d 82, 266 Or. App. 806, 2014 Ore. App. LEXIS 1536 (Or. Ct. App. 2014).

Opinion

NAKAMOTO, J.

Claimant seeks judicial review of an order of the Employment Appeals Board (EAB) concluding that she was disqualified from receiving unemployment insurance benefits because she had been discharged for misconduct. Claimant contends that the EAB’s order is not supported by substantial reason and that the EAB committed legal error in its analysis. We agree with claimant and reverse and remand.

We take the facts, which are undisputed, from the EAB’s order and the record. Claimant worked for respondent Check Cash Pacific (employer) for over 11 years. During the last four years of her employment, employer expanded her regular job duties and responsibilities. Before the incident that led to her termination, claimant had never refused to perform work and had not been reprimanded for failing to perform her duties. From the time claimant began working in 2001 until 2008, employer gradually increased her hourly wage. From 2008 until employer terminated her employment in 2012, she did not receive pay increases.

The incident that precipitated claimant’s termination occurred on June 18, 2012, and concerned her supervisor’s request that she review the accuracy of certain loan documents. She had occasionally performed such document reviews in the past. However, she told her supervisor that she would not perform the requested task without receiving a pay raise. After that conversation, claimant continued working for employer for over two weeks. On July 3, claimant’s supervisor told the owner what had occurred on June 18. On July 5, the owner told claimant that he was terminating her employment because of her failure to perform the task her supervisor had assigned on June 18.

Claimant applied for unemployment benefits, which the Employment Department (department) denied on the ground that her failure to follow her supervisor’s directive “was a wantonly negligent disregard of the employer’s interest,” and so she “was discharged for misconduct connected with work.” Claimant requested a hearing, which was held before an administrative law judge (AL J) from the Office of Administrative Hearings.

[808]*808The ALJ concluded that claimant had been discharged, but not for misconduct, and awarded her benefits. The ALJ reasoned that claimant’s behavior constituted an isolated instance of poor judgment:

“Claimant’s behavior was a single occurrence. Claimant had never previously refused to perform work and had not engaged in any repeated pattern of behavior to violate employer’s interests. Claimant’s action showed poor judgment. Claimant made a conscious decision that resulted in a willful violation of employer’s reasonable standard of behavior. Claimant’s action was not illegal or tantamount to unlawful conduct. Also, the evidence did not suggest that claimant’s refusal caused a breach of trust in the employment relationship or otherwise made claimant’s continued employment impossible. Claimant continued working for employer for more than two weeks after June 18, 2012, and the manager did not report the incident to the owner until more than 10 days after the incident. This evidence does not support a finding that claimant’s violation was so egregious as to exceed poor judgment.”

However, on employer’s appeal, the EAB concluded that claimant’s action on June 18 made a continued employment relationship impossible, which excluded her conduct from the exculpatory provision of OAR 471-030-0038(3)(b) pertaining in part to isolated instances of poor judgment, and that she instead was disqualified from receiving benefits because she had been discharged for misconduct.

On review of the EAB’s order, claimant asserts that her conduct was, at worst, an isolated instance of poor judgment rather than disqualifying misconduct. “We review the EAB’s findings for substantial evidence and review the EAB’s order for substantial reason and errors of law.” Fox v. Employment Dept., 261 Or App 560, 563, 323 P3d 530 (2014).

We explained disqualifying misconduct in Fox:

“The employer has the burden to establish misconduct by a preponderance of evidence. Babcock v. Employment Div., 25 Or App 661, 664, 550 P2d 1233 (1976). Under ORS 657.176(2)(a), an individual who ‘[h]as been discharged for misconduct connected with work’ is not entitled to receive unemployment insurance benefits. ‘Misconduct’ is defined in OAR 471-030-0038(3)(a) as ‘a willful or wantonly [809]*809negligent violation of the standards of behavior which an employer has the right to expect of an employee’ as well as ‘[a]n act or series of actions that amount to a willful or wantonly negligent disregard of an employer’s interest.’ However, an act is not ‘misconduct’ if it is, among other things, an isolated instance of poor judgment. OAR 471-030-0038(3)(b).”

261 Or App at 563-64 (brackets in Fox). Thus, under the department’s administrative rule, certain actions are excluded from the definition of misconduct, including an isolated instance of poor judgment. OAR 471-030-0038(3)(b). An “isolated instance of poor judgment” is defined in OAR 471-030-0038(l)(d) as follows:

“As used in this rule, the following standards apply to determine whether an ‘isolated instance of poor judgment’ occurred:
“(A) The act must be isolated. The exercise of poor judgment must be a single or infrequent occurrence rather than a repeated act or pattern of other willful or wantonly negligent behavior.
“(B) The act must involve judgment. A judgment is an evaluation resulting from discernment and comparison. Every conscious decision to take an action (to act or not to act) in the context of an employment relationship is a judgment for purposes of OAR 471-030-0038(3).
“(C) The act must involve poor judgment. A decision to willfully violate an employer’s reasonable standard of behavior is poor judgment. A conscious decision to take action that results in a wantonly negligent violation of an employer’s reasonable standard of behavior is poor judgment. A conscious decision not to comply with an unreasonable employer policy is not misconduct.
“(D) Acts that violate the law, acts that are tantamount to unlawful conduct, acts that create irreparable breaches of trust in the employment relationship or otherwise make a continued employment relationship impossible exceed mere poor judgment and do not fall within the exculpatory provisions of OAR 471-030-0038(3).”

Although the EAB stated in its order that claimant refused “to perform work assigned to her without factual or legal basis” and that the request by her supervisor on [810]*810June 18 was reasonable because she had performed similar document reviews in the past, the EAB did not expressly determine whether claimant’s conduct constituted an “isolated” instance of “judgment” as described in OAR 471-030-0038(l)(d)(A) and (B). The EAB determined that a reasonable employer

“could conclude, on the basis of claimant’s refusal to review loan files unless she was given a raise, that claimant might refuse to work as assigned in [the] future if she disagreed with some aspect of her employment.”

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Related

Babcock v. Employment Division
550 P.2d 1233 (Court of Appeals of Oregon, 1976)
Callaway v. Employment Department
202 P.3d 196 (Court of Appeals of Oregon, 2009)
Freeman v. Employment Department
98 P.3d 402 (Court of Appeals of Oregon, 2004)
Ring v. Employment Department
134 P.3d 1096 (Court of Appeals of Oregon, 2006)
Fox v. Employment Department
323 P.3d 530 (Court of Appeals of Oregon, 2014)

Cite This Page — Counsel Stack

Bluebook (online)
340 P.3d 82, 266 Or. App. 806, 2014 Ore. App. LEXIS 1536, Counsel Stack Legal Research, https://law.counselstack.com/opinion/isayeva-v-employment-department-orctapp-2014.