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T. Smith v. J. Sampson & AK Dept. of Labor (8/9/91), 816 P 2d 902
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Notice: This is subject to formal
correction before publication in the Pacific
Reporter. Readers are requested to bring
typographical or other formal errors to the
attention of the Clerk of the Appellate
Courts, 303 K Street, Anchorage, Alaska
99501, in order that corrections may be made
prior to permanent publication.
THE SUPREME COURT OF THE STATE OF ALASKA
TERRY L. SMITH, )
) Supreme Court File No. S-3723
Appellant, ) Superior Court No.
) 4FA-88-2085 Civil
)
v. ) O P I N I O N
)
JIM SAMPSON, COMMISSIONER OF )
LABOR, and ALASKA STATE ) [No. 3732 - August 9, 1991]
DEPARTMENT OF LABOR, )
)
Appellees. )
______________________________)
Appeal from the Superior Court of the
State of Alaska, Fourth Judicial District,
Fairbanks, Niesje J. Steinkruger, Judge.
Appearances: Terry L. Smith, Fairbanks,
Appellant Pro Se. Nora King, Assistant
Attorney General, Fairbanks, and Douglas B.
Baily, Attorney General, Juneau, for
Appellees.
Before: Rabinowitz, Chief Justice,
Burke, Matthews, Compton and Moore, Justices.
MOORE, Justice.
This appeal stems from the State Department of Labor's
(DOL) refusal to award Terry Smith unemployment insurance
benefits. Smith worked as a cashier for Pay 'n Save Stores, Inc.
(Pay 'n Save). He was discharged for accepting a credit card
purchase which exceeded the "floor limit" without obtaining
management approval. The DOL denied Smith unemployment benefits
on the ground that he had been fired due to "misconduct"within
the meaning of AS 23.20.379.1 Smith filed for further
administrative and judicial review, which resulted in additional
adverse determinations. He now appeals the superior court's
determination that the DOL's decision was supported by
substantial evidence on the grounds that his action did not
constitute "misconduct,"that he was denied due process in the
administrative adjudication of his claim, and that the DOL
improperly allowed certain evidence against him to be introduced.
We affirm the decision of the superior court.
I.
Smith began working for Pay 'n Save in 1983. Pay 'n
Save cashiers were required to obtain management approval prior
to accepting credit card purchases over the floor limit of
$50.00. In 1988, while working as a cashier at the store, Smith
accepted a VISA credit card on a purchase of over $50.00 without
obtaining authorization from the store's management. He also
accepted a check made out to a different store. On April 27,
1988, Smith was given an employee performance evaluation report
in which he was reprimanded for these actions. He was also
specifically notified that "[n]o further insubordination and non-
cooperation on behalf of Terry Smith will be tolerated by Pay 'n
Save and will result in termination of employment." Smith signed
the evaluation report.2 On or near May 31, 1988, Smith was
presented a Discover credit card for a purchase of over $50.00.3
He called over a public address system for management to approve
the transaction. When no one responded, he called twice more.
He stated that he kept the customer waiting approximately fifteen
minutes, that the customer became irritated, and that other
shoppers who had joined the line were also delayed. Smith
decided to accept the card without management authorization to
avoid angering the customers. Shortly thereafter, the
transaction was discovered and Smith was discharged. He was
terminated May 31, 1988, for "unsatisfactory work performance."
Smith applied for unemployment benefits provided under
the Alaska Employment Security Act on June 15, 1988. On August
24, 1988, he received a Notice of Determination from DOL's
Employment Security Division which stated that his benefits had
been denied. Smith then sought review by the Appeal Tribunal
which sustained the DOL's decision.4 Smith appealed the Appeal
Tribunal's determination to the Commissioner of Labor (COL). On
November 10, 1988, the COL denied Smith's appeal based on its
findings that: 1) the appeal contained no facts which could not
have been presented to the Appeal Tribunal prior to its decision,
and 2) there was no prejudicial error in the Tribunal's decision.
Smith then appealed to the superior court. After hearing oral
argument, the court issued its opinion on December 1, 1989. The
court found that there was "substantial evidence in the record to
support the DOL's finding that Smith's action was misconduct."
It further concluded that "[n]one of Smith's arguments based on
the agency's denial of due process are meritorious." Smith now
appeals that decision to this court.
II.
When the superior court is acting as an intermediate
court of appeal, we will review the underlying determination
independently. See Barcott v. State Dep't of Pub. Safety, 741
P.2d 226, 228 (Alaska 1987). Whether Smith was dismissed from
his employment for "misconduct"is a factual determination. We
will therefore apply the substantial evidence standard of review
to the DOL's determination. Substantial evidence is "such
relevant evidence as a reasonable mind might accept as adequate
to support a conclusion." Storrs v. State Medical Bd., 664 P.2d
547, 554, cert. denied, 464 U.S. 937 (1983). In applying this
standard, "the reviewing court does not reweigh the evidence or
choose between competing inferences; it only determines whether
such evidence exists." Id. (citing Interior Paint Co. v.
Rodgers, 522 P.2d 164, 170 (Alaska 1974)).
Smith's due process and evidentiary arguments raise
questions of law which we will review de novo. We will "adopt
the rule of law that is most persuasive in light of precedent,
reason, and policy." Guin v. Ha, 591 P.2d 1281, 1284 n.6 (Alaska
1979).
III.
Smith does not deny that he accepted a Discover card
purchase in excess of $50.00 without management approval.
However, he claims the superior court wrongly concluded that the
DOL's determination that this action constituted misconduct was
supported by substantial evidence.5
Alaska Statute 23.20.379(a)(2) does not define
"misconduct;"however, the generally accepted definition in this
context is:
(1) a deliberate, wilful, or wanton
disregard of an employer's interest or of the
standards of behavior which he has a right to
expect of his employee, or
(2) carelessness or negligence of such
a degree or recurrence as to manifest equal
culpability, wrongful intent, or evil design.
Annotation, Work-Connected Inefficiency or Negligence as
"Misconduct"Barring Unemployment Compensation, 26 A.L.R.3d 1356,
1359 (1969) (citing Boynton Cab Co. v. Neubeck, 296 N.W. 636
(Wis. 1941)).
Pay 'n Save's policy requiring management authorization
of credit card purchases in excess of a floor limit is obviously
developed to protect the store's interests. Therefore, under the
first prong of the test, we must consider whether there was
substantial evidence to support DOL's determination that Smith
deliberately, wilfully or wantonly disregarded Pay 'n Save's
policy by accepting the Discover card.
The DOL found that Smith was warned on April 27, 1988,
that he would be discharged if he accepted another credit card
without approval; yet, on May 31, 1988, Smith again accepted a
credit card purchase without the required approval. On the basis
of these findings, DOL concluded that Smith was discharged for
misconduct. The preliminary question before us is whether there
is substantial evidence to support the DOL's finding that Smith
was warned.
Contradictory evidence was presented on this issue.
Smith claimed he had never been warned that acceptance of a
charge in excess of $50.00 would result in termination, and that
no specific company policy defined proper procedure for employees
when management failed to respond to an employee's request for
authorization of a transaction. Smith's contentions are verified
in that neither the "general rules,"nor the "cash register
procedures"contained in the company's policy manual state that
termination will result from acceptance of a credit card
transaction without management approval.
However, the record also contains the April 27, 1988
performance evaluation, signed by Smith, which charges him with
apparent "loss of interest in his job" as evidenced by his
carelessness in accepting a credit card without authorization.
The evaluation unequivocally states further noncooperation will
result in discharge. Additionally, the record contains a signed
statement of Pay 'n Save's personnel manager, Sharon Lovell, that
Smith was warned to correct his "cashiering paperwork problems"
and that failure to do so would result in termination. Lovell
testified telephonically to the same facts. Finally, Smith
admitted that he knew the policy whereby he was required to
obtain management authorization before accepting such
transactions.
Weighing the evidence is the role of the DOL, not the
court. See Miller v. ITT Arctic Serv., 577 P.2d 1044, 1049
(Alaska 1978). Thus, even if the evidence might support a
different conclusion than that reached by the DOL, if there is
sufficient evidence upon which the DOL could reasonably have
reached its conclusion, we must affirm.
There is substantial support in the record for DOL's
determination that Smith was warned a month prior to his
discharge that accepting a credit card transaction in excess of
$50.00 without management approval would result in termination.
Therefore, there is evidence to support the DOL's conclusion that
his decision to go forward with the transaction despite the
recent warning was a deliberate violation of a rule which Pay 'n
Save had a reasonable right to expect him to follow.6
Smith contends that his violation of the policy should
be excused because he faced "circumstances beyond his control."
He argues that due to the difficulty of the situation in which he
found himself, he should not be held responsible for the
violation, especially since his actions did comply with the
company's implied policy of maintaining customer satisfaction.7
Although Smith was undoubtedly in an awkward position,
situations in which the policy might cause customer
dissatisfaction could occur with some frequency. Yet, Pay 'n
Save did not describe any exceptions to its rule. On the
contrary, Smith's supervisors appear to have made a conscious
effort to convey the importance and rigidity of the policy to
Smith. Thus, Pay 'n Save could reasonably expect him to comply
with the rule regardless of the circumstances in which its
observance arose. Furthermore, the situation was clearly not
entirely "beyond his control." Alternatives to violation of the
policy were available to Smith. For example, Smith could have
stated that he could not help the customer, and asked the
customer to stand aside and wait while he assisted other
customers. This would have complied with the rule, while
avoiding the risk that other customers would be angered by the
delay.
We conclude that Smith's willful violation of a policy
of which he had been warned just one month previously constituted
misconduct.8 Therefore, we affirm the superior court's
determination that there was substantial evidence to support the
decision of the DOL.
IV.
Smith claims that he was denied due process in the
administrative adjudication of his claim and that the DOL
improperly admitted certain evidence against him. As the DOL
correctly notes, these issues are not raised in Smith's Statement
of Points on Appeal. Thus, these claims are not properly before
us. Alaska R. App. P. 210(e). However, in light of the fact
that Smith generally complied with the requirements of Rule
210(e), it may be appropriate to relax certain procedural
requirements in view of Smith's status as a pro se litigant. See
Bauman v. State, Div. of Family & Youth Serv., 768 P.2d 1097,
1099 (Alaska 1989) (pro se litigants are expected to acquire
general familiarity and to attempt to comply with the rules of
procedure); Breck v. Ulmer, 745 P.2d 66, 75 (Alaska 1987)
(pleadings of pro se litigants should be held to less stringent
standards than those of lawyers), cert. denied, 485 U.S. 1023
(1988).
Smith's primary due process claim is that the DOL
excluded material evidence.9 First, he argues that it failed to
subpoena certain witnesses he wanted to call. However, 8 AAC
85.153(j) provides that witnesses will be subpoenaed "only upon a
showing of necessity."10 Nowhere does Smith claim or show that
the witnesses refused to testify or that subpoena's were
necessary for any reason. Smith also alleges that his work
schedule for the day in question should have been produced and
considered at the hearing. He offers no explanation of what the
schedule would have shown, or how it is relevant.
Finally, Smith asserts that the Employer's Statement
which was presented at his hearing was hearsay. However, AS
23.20.420(a) provides that, "[a]n appeal tribunal shall inquire
into and develop all facts bearing on the issues and shall
receive and consider evidence without regard to statutory and
common law rules." (Emphasis added). Moreover, Smith give no
indication that a hearsay objection was made at the hearing. In
the absence of a hearsay objection, hearsay evidence is competent
evidence which may be considered.
Therefore, we reject Smith's due process arguments and
his contention that the DOL improperly considered certain
evidence. In light of our holding that there was substantial
evidence to support the DOL's determination that Smith was
discharged for misconduct, we affirm its denial of his
unemployment benefits pursuant to AS 23.20.379.
AFFIRMED.
_______________________________
1. AS 23.20.379 provides in relevant part:
(a) An insured worker is disqualified
for waiting-week credit or benefits for the
first week in which the insured worker is
unemployed and for the next five weeks of
unemployment following that week if the
insured worker
. . .
(2) was discharged for
misconduct connected with the insured
worker's work . . . .
2. Smith denies that the allegations contained in the
reprimand were accurate. He signed the report where the form
indicated: "In signing I do not necessarily indicate agreement.
I do indicate that I have read the above comments."
3. Smith claims that the date he accepted the Discover card
was May 28, 1988, while Pay 'n Save claims the date was May 31,
1988. Since Smith admits that the incident occurred, the dispute
as to the exact date is irrelevant.
4. The right to such review is provided under AS 23.20.415.
5. Smith also argues that Pay 'n Save's actions constituted
wrongful termination of employment. However, Smith has never
filed any action disputing the legality of his termination; the
appeal before us stems exclusively from the denial of
unemployment compensation. The scope of our review is limited to
the question whether the DOL improperly refused him unemployment
insurance.
6. In Smith's words:
I had no control over the lines of
people when there's one cashier. I have to
do something. So when management does [not]
show up, Your Honor, I have to literally take
charge and do the best I can, look at the
interest of my employer. . . . I'm not
denying I know the policy, I'd been employed
there for six years . . . and I know what to
do in circumstances like that. (Emphasis
added).
7. Smith places considerable reliance on Shop 'n Save
Warehouse Foods, Inc., 85 Lab. Arb. (BNA) 495 (1985) (Newmark,
Arb.), in which it was determined that Shop 'n Save had
improperly suspended a cashier for five days for voiding certain
items without the required management approval. Id. at 495.
Notably, Shop 'n Save concerns administration of discipline under
a collective bargaining agreement and not denial of unemployment
insurance; the opinion does not address the question of
misconduct.
Furthermore, to the extent the issue in Shop 'n Save is
analogous to the question before us, the two cases are factually
distinguishable. In Shop 'n Save, the company had a system of
progressive discipline whereby it would first give employees who
violated the policy a written warning. If there was a second
violation, a five day suspension would be imposed. The
arbitrator concluded that the company violated its disciplinary
procedure by simultaneously punishing the employee for two
violations of its policy. Id. at 500. Here, there is no serious
contention that Pay 'n Save violated a company policy.
8. Cf.; Medcenter One, Inc. v. Job Serv, 410 N.W.2d 521
(N.D. 1987) (affirming finding nurse's discussion of her personal
life with a patient, following a warning that such behavior would
result in termination, was misconduct); In re Claim of Bouleware,
393 N.E.2d 487 (N.Y. 1979) (affirming finding of misconduct where
employee discharged for disobeying clear instruction given one
day before); In re Claim of McIntee, 408 N.Y.S.2d 841 (N.Y. 1978)
(finding of disqualifying misconduct upheld as to an ambulance
driver who was discharged for exceeding company speed limit of 30
mph after having been warned not to speed).
9. Smith also claims that he was not afforded due process
because there were "too many issues"and because he was not
notified of the issues which would be addressed by DOL at his
hearing. We reject this argument. Not only does Smith fail to
offer legal authority for his position, but the factual basis for
his claim is also inadequate.
Smith's only support for this claim is a reference to a
document which he quotes as stating "Issues to be heard" and
which he interpreted as meaning that the DOL would consider more
than one issue. He never argues that the DOL in fact considered
issues of which he had not been notified. Furthermore, the
document to which Smith appears to be referring (we are unable to
locate any document in the record which precisely matches his
description) is a notice of hearing which was sent to Smith prior
to the review of his claim by the Appeal Tribunal. The form
states: "Issue(s) to be heard: 1. Reason for claimant's
separation from work with the above-named employer." The form is
not ambiguous. There is no evidence in the record to suggest
that the DOL considered any issue or issues of which Smith was
not notified.
10. In the Appeal Information supplied to claimants,
including Smith, the DOL advises claimants:
4. Arrange for your witnesses. If
there are persons who actually saw or heard
something you need to prove, ask them to be
witnesses. Ask them to come to the hearing
or give their telephone number to the Appeal
Tribunal. If the person will not testify
otherwise, you may ask the Appeal Tribunal to
subpoena the witness.
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