O'Neill v. Civil Service Commission

328 N.W.2d 547, 121 Mich. App. 256

• Court: Michigan Court of Appeals
• Decided: September 10, 1982
• Docket: Docket No. 54073
• Status: Published

Opinions

Per Curiam.

The Michigan Civil Service Commission appeals a circuit court order reversing the commission’s decision to affirm the decision to demote Lois O’Neill from a civil service rating of 18 to a rating of 16.

O’Neill, who retired after a distinguished career on the Detroit police force, was appointed by the Governor on January 1, 1975, as Director of Enforcement in the Department of Licensing and Regulation. She was transferred, at the request of Mr. John Dempsey, Director of the Department of Social Services (DSS), to the DSS’s Office of Standards and Investigations where she was named director. In this new position, she was given a civil service rating of 18. While plaintiffs title was changed in 1978, she retained her civil service rating.

As director of the Office of Standards and Investigations (OSI), O’Neill was in charge of the Office of Inspector General (OIG). One of the duties of the OIG was to investigate welfare fraud and cooperate with the Attorney General and local prosecutors in the prosecution of fraud indictments. In late 1977, the OIG developed the "system concept of welfare fraud” whereby computers were used to match data from welfare records with state and private business records. This process made it possible to determine fraudulent payments of welfare benefits. O’Neill publicized this system in newspapers and appeared on NBC’s "Today” show to explain the system. The Attorney General became upset over the premature publicity about the system and of the progress being made in the prosecution of fraud cases. As a result of this dissatisfaction, Director Dempsey reorganized the OIG giving complete responsibility for welfare fraud matters to Paul Allen, Chief Deputy Director of DSS. O’Neill remained as director of the OSI, but had no responsibility for welfare fraud matters.

May, 1978, the Auditor General completed its audit of the OIG. A preliminary audit report, critical of the OIG, was sent to Dempsey on May 18, 1978. Dempsey told O’Neill to investigate the report, but he also informed her that he himself would answer it.

On May 22, 1978, Dempsey appeared before the House Appropriations Subcommittee for hearings concerning the 1979 funding for DSS. During the hearings, the subcommittee asked the Auditor General’s staff for information concerning the audit of OIG. Although the audit was not complete, the preliminary information was critical of the OIG’s operation. When asked by the subcommittee for her comments, O’Neill claimed that she was treated unfairly in violation of Const 1963, art 1, § 17. The meeting ended with Dempsey attempting to apologize for O’Neill.

The exit review of the audit report was scheduled for June 13, 1978. On June 7, 1978, O’Neill sent a letter to the Auditor General which contained questions which the Auditor General found offensive. A follow-up letter was sent on June 12, 1978, but neither letter was answered. When Dempsey found out about the letters, he attempted to withdraw them, but the Auditor General refused. Copies of the letters were sent to the Legislature.

On June 26, 1978, O’Neill was told that she was being demoted to a civil service rating of 16% On June 27, 1978, she received the formal memo demoting her. The Senate Budget Committee met on June 28, 1978, and voted to abolish the OIG. However, they reconsidered their action after hearing of O’Neill’s demotion and restored funding to the OIG.

O’Neill filed a grievance with the Civil Service Commission. After a hearing, the commission denied her grievance.

O’Neill appealed to the Ingham County Circuit Court, which reversed the commission’s decision. The court found that she was demoted because of political pressure by the Legislature and that the commission’s findings were not based upon competent, material, and substantial evidence. The commission appeals the circuit court decision.

The decision of the Civil Service Commission will be affirmed if it is authorized by law and supported by competent, material, and substantial evidence on the whole record. Const 1963, art 6, §28; Parnis v Civil Service Comm, 79 Mich App 625, 628; 262 NW2d 833 (1977). We accord due deference to administrative expertise and will not invade the province of exclusive administrative fact-finding by displacing an agency’s choice between two reasonably differing views. Michigan Employment Relations Comm v Detroit Symphony Orchestra, Inc, 393 Mich 116, 124; 223 NW2d 283 (1974). The commission does not have to support its decision by a preponderance of the evidence. Parnis, supra, 630.

Review of this case is hampered by the lack of transcripts of the oral testimony before the Civil Service Commission. As Judge MacKenzie’s partial concurrence correctly points out, it was the parties’ responsibility to insure that the testimony was transcribed and made part of the record. See GCR 1963, 706.3; MCL 24.286; MSA 3.560(186). However, plaintiff failed to request a transcript when she appealed to the circuit court. While we are hampered by plaintiff’s oversight, we note that the content of the testimony contained in the opinion of the Civil Service Commission hearing officer is not disputed. Therefore, we will review this case to determine if the Civil Service Commission’s decision is based upon competent, material, and substantial evidence.

O’Neill’s demotion was made pursuant to Civil Service Commission Rule 27, which provides in pertinent part:

"27.1 Deñnition. — A demotion is defined as a transfer of a status employee from a position which he occupies in one class to a position in another class at a lower classification level.

"27.2 Condition. — A demotion may be under any of the following conditions:

"27.2a When an employee is not rendering satisfactory service in the position he holds.”

On appeal, plaintiff does not challenge the validity of the rule, but argues that the commission’s decision was not supported by competent, material, and substantial evidence.

A review of the evidence taken by the commission does support the commission’s decision. John Dempsey, Director of DSS, testified that he had supervised O’Neill for three years. During that time, he counseled her about her attitude on several occasions. Dempsey further testified that O’Neill was cynical, hard-nosed, and uncooperative at department meetings. According to Dempsey, plaintiff was not interested in administrative settlements of welfare fraud cases but would rather prosecute offenders. The evidence also demonstrated that she was relieved of her duties as supervisor of the OIG’s welfare fraud functions because the Attorney General thought progress on fraud cases was unsatisfactory and the "welfare computer match system” was receiving premature publicity. Finally, the evidence showed that O’Neill had poor working relationships with the Legislature and the Auditor General. While facts were presented which demonstrated that O’Neill’s supervision of the Office of Standards and Investigations was commendable, the evidence does support the conclusion that she was unable to work with other branches of the government which were critical to the OSI’s function. Therefore, the Civil Service Commission’s decision was based upon competent, material, and substantial evidence on the whole record.

The circuit court, however, found that O’Neill’s demotion was for political reasons and reversed the Civil Service Commission. According to O’Neill, she was demoted to insure the continued funding for the OIG. This argument ignores the facts. O’Neill was first informed of the decision to demote her on June 26, 1978. The next day, she received a memo formally demoting her to a Civil Service rating 16. On June 28, 1978, the Senate Budget Committee first considered abolishing the OIG. They reconsidered their decision on June 30, 1978, when they discovered O’Neill’s demotion. There was no evidence presented demonstrating that DSS knew of the Senate Budget Committee’s action prior to June 28, 1978. The decision to demote plaintiff was made at least two days prior to the committee’s decision. Under these facts, we are unable to say that O’Neill’s demotion was based upon political pressure by the Senate Budget Committee.

The decision of the circuit court is reversed and the Civil Service Commission’s order of demotion is reinstated.