Phistry v. Department of Employment ( 2010 )

FOURTH DIVISION
November 18, 2010
No. 1-09-2781
BARBARA L. PHISTRY, ) Appeal from the
) Circuit Court of
Plaintiff-Appellee, ) Cook County.
)
v. )
)
THE DEPARTMENT OF EMPLOYMENT ) No. 09 L 50687
SECURITY; DIRECTOR, THE DEPARTMENT )
OF EMPLOYMENT SECURITY; BOARD OF )
REVIEW; )
)
Defendants-Appellants )
)
)
)
(EUGENE C. DECKER, ) Honorable
) Elmer James Tolmaire III,
Defendant). ) Judge Presiding.
PRESIDING JUSTICE GALLAGHER delivered the opinion of the
court:
Defendants, the Department of Employment Security
(Department), Director of the Department, and Board of Review
(Board), appeal from an order of the circuit court of Cook
County, reversing the ruling of the Board that plaintiff, Barbara
Phistry, was ineligible for unemployment benefits from Dr. Eugene
C. Decker (employer), under section 602(A) of the Illinois
Unemployment Insurance Act (Act) (820 ILCS 405/602(A) (West
2008)) due to misconduct in connection with her work. On appeal,
defendants claim that plaintiff committed misconduct when she
made personal charges on her employer's credit card without his
permission. Plaintiff has not filed a brief in response;
however, we may proceed under the principles set forth in First
1-09-2781
Capitol Mortgage Corp. v. Talandis Construction Corp., 63 Ill. 2d
128, 133 (1976).
The record shows that plaintiff was employed as the full-
time office manager for the dental office of Dr. Eugene C. Decker
from 2001 until her termination in September 2008. Following her
termination, plaintiff filed a claim for unemployment benefits,
to which her employer objected. A Department claims adjudicator
ruled that plaintiff was ineligible for benefits because she was
terminated for misconduct connected with her work.
Plaintiff then filed an administrative appeal, and a
Department referee conducted a telephone hearing where both
plaintiff and the employer testified. During that hearing, Dr.
Decker stated that plaintiff was an authorized user of three
office credit cards. The office had no written policy regarding
the employees’ use of credit cards, and although Dr. Decker did
not inform plaintiff that the cards were only to be used for
office-related purchases, he considered it "common sense" and an
"unspoken policy" that the cards were to be limited to office-
related purchases.
On September 16, 2008, while Dr. Decker was on vacation, he
received an e-mail message stating that he had earned points on
one of the office credit cards for using it at a restaurant that
he did not patronize. Upon further investigation, Dr. Decker
learned that plaintiff had made unauthorized personal charges on
- 2 -
1-09-2781
the card over a 30-day period in August and September totaling
$1,131.90.
When Dr. Decker returned from vacation on September 29,
2008, he confronted plaintiff about the charges. She initially
denied making them, but then admitted to doing so. Plaintiff
told him that she did not tell him about the purchases because
she had not seen him and that she intended to repay the money.
Dr. Decker, however, related that he had seen plaintiff since she
made the purchases in August and that he was available by cell
phone and email during his vacation. He also stated that his
business never recovered the money from plaintiff’s purchases.
During the hearing, plaintiff testified that she did not
realize that she was not permitted to use the credit cards for
personal purchases and that she did not contact Dr. Decker
regarding the purchases in question because he was on vacation
and she did not want to disturb him. She related her prior use
of an office credit card to have an office birthday party for her
sister, who was also an employee, and that Dr. Decker refused her
offer for reimbursement. Plaintiff also stated that she had used
an office credit card a few years ago to rent a carpet cleaner
for her residence, and when she informed Dr. Decker about it
afterwards, he did not indicate that he found her use of the card
improper. Dr. Decker, however, did not recall these events.
- 3 -
1-09-2781
In regard to the spending that caused her termination,
plaintiff stated that she charged the personal items because she
and her children had nothing to wear to her mother’s wake. She
also stated that she continued working during the period her
mother was ill and died, and that she did not remember to inform
Dr. Decker of her purchases on the business credit card.
The referee found that plaintiff had used the office credit
card for personal use before and that Dr. Decker did not request
her to reimburse the company for the debt. The referee then
concluded that plaintiff was not disqualified for benefits based
on misconduct, where it had become common practice to make
personal purchases with the office credit card, such that no
reasonable rule existed prohibiting personal purchases. The
referee also concluded that Dr. Decker was not harmed because he
indicated that he would use plaintiff's purchases as a tax write
off.
On review, the Board concluded that plaintiff was ineligible
for unemployment benefits because she was terminated for
misconduct in connection with her work. The Board found that
although no formal policy existed for company credit card usage,
plaintiff's examples of past use did not constitute implied
permission to use the credit card for personal purchases. It
also concluded that plaintiff's actions were willful in that she
made multiple charges over a 30-day period and never asked
- 4 -
1-09-2781
permission to do so. It also found that the employer had been
harmed because Dr. Decker lost trust in his employee, never
recovered the funds charged to the account, and incurred the cost
of training a new office manager.
Plaintiff subsequently filed a complaint for administrative
review in the circuit court of Cook County. That court reversed
the Board, finding that its decision was clearly erroneous.
Defendants now contest that ruling on appeal. They maintain that
the Board’s decision finding plaintiff disqualified from
receiving unemployment benefits based on her misconduct under the
Act was not clearly erroneous.
This court reviews the decision of the Board rather than the
circuit court or the referee. Sudzus v. Department of Employment
Security, 393 Ill. App. 3d 814, 819 (2009). The question of
whether an employee was terminated for misconduct under the Act
involves a mixed question of law and fact to which we apply the
"clearly erroneous" standard of review. AFM Messenger Service,
Inc. v. Department of Employment Security, 198 Ill. 2d 380, 395
(2001); Oleszczuk v. Department of Employment Security, 336 Ill.
App. 3d 46, 50 (2002). An agency decision will be deemed clearly
erroneous where a review of the record leaves the court with a
definite and firm conviction that a mistake has been committed.
AFM Messenger Service, 198 Ill. 2d at 395. For the reasons that
follow, we find this is not such a case.
- 5 -
1-09-2781
Section 602(A) of the Act disqualifies a former employee
from receiving unemployment benefits if she was discharged for
misconduct connected with her work. 820 ILCS 405/602(A) (West
2008); Grigoleit Co. v. Department of Employment Security, 282
Ill. App. 3d 64, 68 (1996). Misconduct is defined as (1) a
deliberate and willful violation of (2) a reasonable rule or
policy (3) that harms the employer or other employees or has been
repeated by the former employee despite a warning or other
explicit instructions from the employer. Sudzus v. Department of
Employment Security, 393 Ill. App. 3d 814, 826 (2009); 820 ILCS
405/602(A) (West 2008).
Conduct is deemed willful where it constitutes a conscious
act made in knowing violation of company rules. Czajka v.
Department of Employment Security, 387 Ill. App. 3d 168, 176
(2008). A reviewing court need not find direct evidence of a
rule or policy and, instead, may make a commonsense determination
that certain conduct intentionally and substantially disregards
an employer's interest. Greenlaw v. Department of Employment
Security, 299 Ill. App. 3d 446, 448 (1998).
Here, the record shows that plaintiff's conduct was willful
in that she used her position as the office manager to make
personal purchases on a business credit card over a 30-day period
without her employer’s permission. Plaintiff acknowledges that
these purchases were intentional, and there is no evidence that
- 6 -
1-09-2781
she acted with her employer's permission or to support her
contention that she acted with implied consent based on her two
prior uses of the card. Those expenditures are factually
distinct from the case at bar, in that the expenditure for the
party for her sister and coworker was office related and the one
relating to her carpet cleaning was not confirmed by her
employer.
The evidence further shows that plaintiff’s conduct harmed
the practice by the loss of trust that had been placed in her by
the employer, who also suffered a financial loss from plaintiff’s
purchases, and because he would have to absorb the cost of
training a new office manager. We thus find that the Board's
decision finding plaintiff ineligible for benefits based on
misconduct connected with her work was not clearly erroneous (Ray
v. Department of Employment Security, 244 Ill. App. 3d 233, 236
(1993)), and we reverse the circuit court’s ruling to the
contrary.
Reversed.
O’BRIEN and O’MARA FROSSARD, JJ., concur.
REPORTER OF DECISIONS - ILLINOIS APPELLATE COURT
(Front Sheet to be Attached to Each case)
_____________________________________________________________________________
BARBARA L. PHISTRY,
Plaintiff-Appellee,
v.
- 7 -
1-09-2781
THE DEPARTMENT OF EMPLOYMENT SECURITY, DIRECTOR OF THE DEPARTMENT
OF EMPLOYMENT SECURITY, and BOARD OF REVIEW,
Defendants-Appellants
(EUGENE C. DECKER,
Defendant).
_____________________________________________________________________________
No. 1-09-2781
Appellate Court of Illinois
First District, Fourth Division
November 18, 2010
_____________________________________________________________________________
PRESIDING JUSTICE GALLAGHER delivered the opinion of the court.
O’BRIEN and O’MARA FROSSARD , JJ., concur.
_____________________________________________________________________________
Appeal from the Circuit Court of Cook County.
Honorable James Tolmaire, III, Judge Presiding.
_____________________________________________________________________________
For APPELLANTS, Illinois Attorney General, Chicago, IL (Lisa Madigan, Michael A. Scodro,
Ann C. Chalstrom, of counsel)
- 8 -