A.R. v. Review Board of the Indiana Department of Workforce Development and Housing Authority of the City of Kokomo (mem. dec.) ( 2015 )


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  • MEMORANDUM DECISION
    Aug 07 2015, 8:20 am
    Pursuant to Ind. Appellate Rule 65(D), this
    Memorandum Decision shall not be regarded as
    precedent or cited before any court except for the
    purpose of establishing the defense of res judicata,
    collateral estoppel, or the law of the case.
    ATTORNEY FOR APPELLANT                                    ATTORNEYS FOR APPELLEE
    Richard L. Darst                                          Gregory F. Zoeller
    Cohen Garelick & Glazier                                  Attorney General of Indiana
    Indianapolis, Indiana
    Kristin Garn
    Deputy Attorney General
    Indianapolis, Indiana
    IN THE
    COURT OF APPEALS OF INDIANA
    A.R.,                                                    August 7, 2015
    Appellant-Petitioner,                                    Court of Appeals Case No.
    93A02-1411-EX-800
    v.                                               Appeal from the Review Board of the
    Department of Workforce
    Development.
    Review Board of the Indiana
    The Honorable Steven F. Bier,
    Department of Workforce                                  Chairperson.
    Development and Housing
    Case No. 14-R-0277
    Authority of the City of
    Kokomo,
    Appellee-Respondent.
    Riley, Judge.
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015       Page 1 of 14
    STATEMENT OF THE CASE
    [1]   Appellant, Angela R. Riley (Riley), 1 appeals the decision of the Unemployment
    Insurance Review Board (the Review Board) of the Indiana Department of
    Workforce Development (DWD), which upheld the decision of the
    administrative law judge (ALJ) denying her claim for unemployment
    compensation benefits on the basis that she had been terminated from her
    employment for just cause.
    [2]   We affirm.
    ISSUES
    [3]   Riley raises two issues on appeal, which we restate as follows:
    (1) Whether there is sufficient evidence to support the Review Board’s
    determination that Riley is ineligible for unemployment compensation benefits
    because she was discharged for just cause; and
    (2) Whether Riley’s due process rights were violated.
    FACTS AND PROCEDURAL HISTORY
    [4]   On November 3, 2008, the Housing Authority of the City of Kokomo
    (Employer) hired Riley as a full-time Application Processing Clerk. Riley
    1
    The parties refer to Riley using her initials. However, our court has previously found that, notwithstanding
    the confidentiality mandate of Indiana Code section 22-4-19-6 and Indiana Administrative Rule 9(G), “it is
    appropriate for this [c]ourt to use the full names of parties in routine appeals from the Review Board.” Moore
    v. Review Bd. of Ind. Dep’t of Workforce Development, 
    951 N.E.2d 301
    , 306 (Ind. Ct. App. 2011). See also J.M. v.
    Review Bd. of Ind. Dep’t of Workforce Development, 
    975 N.E.2d 1283
    , 1285 n.1 (Ind. 2012) (noting that the
    court’s practice “going forward will be to keep the[] parties confidential only if they make an affirmative
    request”). Therefore, as we did not receive an affirmative request, we will utilize Riley’s name.
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015             Page 2 of 14
    described that her job duties included maintaining the waiting list of applicants
    seeking housing. Once a housing unit became available, Riley was responsible
    for assigning the unit to the next eligible applicant.
    [5]   On May 7, 2014, Riley learned from a maintenance worker that individuals
    were in the process of moving into an apartment which had not been authorized
    for occupancy. Just two months earlier, Riley had received a written warning
    for similarly arranging a housing transfer without first having an inspection
    conducted. Upon learning of the unauthorized move-in, Riley contacted
    Employer’s chief executive officer, Debra Cook (CEO Cook), and requested an
    immediate meeting in order to demand “an answer” as to why these tenants
    were being permitted to move into an unpainted, dirty unit. (Tr. p. 25). CEO
    Cook informed Riley that she was in a meeting and could not see her right
    away. CEO Cook advised Riley to discuss the issue with her immediate
    supervisor. Instead, Riley contacted the Indianapolis office to report that
    tenants had been permitted to move into an apartment that was still “on
    administrative hold.” (Tr. p. 25).
    [6]   Riley “was agitated that the tenants had been allowed to move into the
    apartment.” (Appellant’s App. p. 4). Riley’s supervisor, Property Manager
    Tina Bellis (Property Manager Bellis), spoke with CEO Cook and learned that
    management was aware of the unauthorized tenants and was handling the
    issue. Property Manager Bellis relayed this information to Riley, but Riley
    “became very loud and irritable” and complained to other employees about her
    dissatisfaction with Employer’s procedures. (Tr. p. 21). Because Riley was
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015   Page 3 of 14
    causing a disturbance throughout the office, CEO Cook suspended her meeting
    and asked an assistant property manager to send Riley into her office. Instead
    of reporting to CEO Cook’s office as instructed, Riley called CEO Cook and
    “said she would not come to [her] office” because it “wouldn’t do any good.”
    (Tr. p. 12). According to Riley, she had already handled the issue by reporting
    the matter to the Indianapolis office, so “there was no reason for [her] to [go]
    down to [CEO Cook’s] office.” (Tr. p. 26).
    [7]   Employer’s Personnel Policy Manual provides that an employee “may be
    subject to discharge upon the first offense” for committing “insubordination –
    [f]ailing to follow or comply with instructions or work orders in a timely
    manner.” (Appellant’s App. p. 15). After Riley refused CEO Cook’s directive
    to come to her office, CEO Cook resolved to terminate Riley’s employment.
    However, the director of human resources was out of the office and could not
    process Riley’s termination until the following morning. In addition, Riley did
    not report to work for the two days following the incident, taking one day off
    under the Family and Medical Leave Act (FMLA) and one vacation day.
    Thus, it was not until Riley returned to work the following Monday, May 12,
    2014, that she was notified of the termination.
    [8]   Riley subsequently filed a claim with the DWD for unemployment
    compensation benefits. On July 31, 2014, a DWD deputy rendered an initial
    determination that Riley had not been terminated for just cause and was
    therefore eligible for unemployment compensation benefits. On August 9,
    2014, Employer appealed the deputy’s ruling to an ALJ. On September 23,
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015   Page 4 of 14
    2014, the ALJ conducted a hearing by a telephone conference call, and on
    September 26, 2014, the ALJ issued a decision, reversing the DWD deputy and
    finding Riley ineligible for unemployment compensation benefits. In particular,
    the ALJ concluded that Riley “knowingly violated reasonable and uniformly
    enforced rules. [Riley] was insubordinate when [she] refused to go to [CEO
    Cook’s] office. The request by [CEO Cook] was a reasonable request. [Riley]
    was discharged for just cause as defined by [Indiana Code section] 22-4-15-1.”
    (Appellant’s App. p. 5).
    [9]    On October 10, 2014, Riley appealed the ALJ’s decision to the Review Board.
    On October 27, 2014, the Review Board affirmed the ALJ’s decision, adopting
    and incorporating by reference the ALJ’s findings of fact and conclusions of
    law. The Review Board added a specific finding that CEO Cook possessed the
    “authority to require [Riley] to report to her office” and despite the fact that
    CEO Cook’s instruction was “reasonable[,]” Riley “refused to do so.”
    (Appellant’s App. p. 2).
    [10]   Riley now appeals. Additional facts will be provided as necessary.
    DISCUSSION AND DECISION
    I. Standard of Review
    [11]   “Any decision of the [R]eview [B]oard shall be conclusive and binding as to all
    questions of fact.” Ind. Code § 22-4-17-12(a). The Review Board’s decision
    may only be challenged on appeal “as being contrary to law, in which case we
    examine the sufficiency of the facts found to sustain the decision and the
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015   Page 5 of 14
    sufficiency of the evidence to sustain the findings of facts.” Coleman v. Review
    Bd. of Ind. Dep’t of Workforce Development, 
    905 N.E.2d 1015
    , 1019 (Ind. Ct. App.
    2009). Pursuant to this standard, “we review determinations of specific or basic
    underlying facts, conclusions or inferences drawn from those facts, and legal
    conclusions.” 
    Id. [12] Our
    standard of review is threefold: “(1) findings of basic fact are reviewed for
    substantial evidence; (2) findings of mixed questions of law and fact—ultimate
    facts—are reviewed for reasonableness; and (3) legal propositions are reviewed
    for correctness.” Reed v. Review Bd. of Ind. Dep’t of Workforce Development, 
    32 N.E.3d 814
    , 822 (Ind. Ct. App. 2015). We will consider only the evidence most
    favorable to the Review Board’s findings, without reweighing evidence or
    assessing the credibility of witnesses. 
    J.M., 975 N.E.2d at 1286
    . We will affirm
    the decision of the Review Board unless there is no substantial evidence to
    support its findings. 
    Id. II. Sufficiency
    of the Evidence
    [13]   The Indiana Unemployment Compensation Act was enacted, in part, “to
    provide for payment of benefits to persons unemployed through no fault of their
    own.” I.C. § 22-4-1-1. Accordingly, an unemployed claimant is ineligible for
    unemployment benefits if she is discharged for just cause. I.C. § 22-4-15-1(a).
    “Discharge for just cause” is defined to include, but is not limited to:
    (1) separation initiated by an employer for falsification of an
    employment application to obtain employment through subterfuge;
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    (2) knowing violation of a reasonable and uniformly enforced rule of an
    employer, including a rule regarding attendance;
    (3) if an employer does not have a rule regarding attendance, an
    individual’s unsatisfactory attendance, if the individual cannot
    show good cause for absences or tardiness;
    (4) damaging the employer’s property through willful negligence;
    (5) refusing to obey instructions;
    (6) reporting to work under the influence of alcohol or drugs or
    consuming alcohol or drugs on employer’s premises during
    working hours;
    (7) conduct endangering safety of self or coworkers;
    (8) incarceration in jail following conviction of a misdemeanor or
    felony by a court of competent jurisdiction; or
    (9) any breach of duty in connection with work which is reasonably
    owed an employer by an employee.
    I.C. § 22-4-15-1(d) (emphasis added). When an employer alleges that an
    employee has been discharged for just cause, “the employer bears the burden of
    establishing a prima facie case of discharge for just cause.” Albright v. Review
    Bd. of Ind. Dep’t of Workforce Development, 
    994 N.E.2d 745
    , 750 (Ind. Ct. App.
    2013). Once the employer has satisfied its burden, the onus “shifts to the
    employee to rebut the employer’s evidence.” 
    Id. [14] In
    this case, the Review Board found that Riley was discharged for just cause
    under subsection (d)(2) based on her violation of Employer’s rule against
    insubordination. Riley now claims that there is insufficient evidence to support
    this determination. First, she argues that there is a lack of substantial evidence
    that she was insubordinate on March 6, 2014, for which she received a written
    warning on March 7, 2014, for arranging an improper housing transfer. We,
    however, find no merit or relevancy in this argument because the March 7,
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015   Page 7 of 14
    2014 warning was not the basis for Riley’s termination. Rather, at the hearing
    before the ALJ, Employer relied on the May 7, 2014 incident—in which Riley
    refused CEO Cook’s instruction to report to her office—as its reason for
    terminating Riley’s employment and only briefly mentioned that Riley had
    been insubordinate on a prior occasion. Furthermore, neither the ALJ nor the
    Review Board cited Riley’s previous warning for insubordination as a just cause
    for discharge. Instead, both the ALJ and the Review Board exclusively found
    that Riley violated Employer’s rule against insubordination by refusing to go to
    CEO Cook’s office. Likewise, we will limit our review solely to whether there
    is substantial evidence of just cause to terminate Riley based on her
    insubordinate behavior on May 7, 2014.
    [15]   “To knowingly violate an employer’s rule, the employee must (1) know of the
    rule and (2) know his conduct violated the rule.” 
    Id. A review
    of the record
    reveals that Riley had received a copy of Employer’s Personnel Policy Manual,
    which identifies “insubordination—[f]ailing to follow or comply with
    instructions or work orders in a timely manner”—as an offense for which an
    employee is subject to discharge in the first instance. (Appellant’s App. p. 15).
    On May 7, 2014, CEO Cook, who is undisputedly Riley’s superior, asked an
    assistant property manager to send Riley into her office because of the
    disturbance Riley was creating throughout the workplace. When the assistant
    property manager told Riley that CEO Cook “would like to see her,” Riley
    instead called CEO Cook and “said she would not come to [her] office.” (Tr.
    pp. 12, 20). During the hearing before the ALJ, Riley admitted that she saw
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015   Page 8 of 14
    “no reason . . . to [go] down to [CEO Cook’s] office” because “the situation
    had already been tak[en] care of.” (Tr. p. 26). By directly refusing to comply
    with CEO Cook’s instruction, we find sufficient evidence that Riley knowingly
    violated Employer’s rule against insubordination. Nevertheless, Riley attempts
    to redirect the blame, asserting that it was Employer who violated the policy
    against allowing tenants to move into an unprepared apartment and that it was
    CEO Cook who initially refused Riley’s request for a meeting. Ultimately,
    these allegations have no bearing on the fact that Riley—as the employee—was
    subject to Employer’s rule against insubordination, and Riley violated this rule
    when she disregarded CEO Cook’s instruction.
    [16]   In order for an employee’s rule violation to merit “[d]ischarge for just cause[,]”
    the employer’s rule must be “reasonable and uniformly enforced.” I.C. § 22-4-
    15-1(d)(2). A work rule will be found to be reasonable if it:
    (1) is lawful;
    (2) is related to the employer’s business operations;
    (3) is intended by the employer to broadly apply to classes, categories,
    or all employees;
    (4) does not create a harsh or unconscionable requirement for
    employees.
    646 Ind. Admin. Code § 5-8-5. Riley contends that Employer’s rule is
    unreasonable because it “is enforced in a discriminatory or retaliatory manner
    based on FMLA leave, sex, race, or disability.” (Appellant’s Br. p. 21). We
    disagree. Employer’s director of human resources testified that the policy
    against insubordination applies to and is enforced equally against all employees.
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015   Page 9 of 14
    CEO Cook testified that the rule exists because “insubordination will impact
    the effective and efficient operations of this agency, and it negatively affects
    employee moral[e].” (Tr. p. 13). The Personnel Policy Manual further explains
    that the rules are intended “to insure continuous and successful [Employer]
    operations.” (Appellant’s App. p. 14). We therefore find that Employer’s rule
    against insubordination is reasonable.
    [17]   Riley also argues that Employer’s rule is not a uniformly enforced policy. “A
    uniformly enforced rule is one that is carried out in such a way that all persons
    under the same conditions and in the same circumstances are treated alike.”
    City of Carmel v. Review Bd. of Ind. Dep’t of Workforce Development, 
    970 N.E.2d 239
    , 245 (Ind. Ct. App. 2012). More specifically, Riley contends that
    “Employer presented no evidence that it terminated anyone for going ‘over the
    head’ of the CEO and complaining to the Indianapolis office” or for improper
    housing transfers. (Appellant’s Br. 23). Yet, neither of these reasons were
    proffered as Employer’s grounds for terminating Riley. As previously stated,
    the ALJ and Review Board found that Riley was terminated for
    insubordination because she disregarded CEO Cook’s instruction to report to
    her office, and the ALJ concluded that “[a]ny employee who committed the
    same action as [Riley] would also be discharged.” (Appellant’s App. p. 4).
    [18]   With respect to uniform enforcement, our supreme court has found:
    Uniform enforcement gives notice to employees about what
    punishment they can reasonably anticipate if they violate the rule and
    it protects employees against arbitrary enforcement. This is important
    to ensure that employees who are denied compensation under this
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    subsection are only those who lost their jobs for reasons within their
    control. Here, the purposes were met if . . . [Riley] knew of the
    violation, knew or can be fairly charged with knowledge that it could
    result in termination, and there was no arbitrary enforcement.
    McClain v. Review Bd. of Ind. Dep’t of Workforce Development, 
    693 N.E.2d 1314
    ,
    1319-20 (Ind. 1998) (internal citation omitted), reh’g denied. Here, Employer’s
    written Personnel Policy Manual was introduced into evidence and clearly
    states that an employee may be subject to discharge for a first offense of
    insubordination. See City of 
    Carmel, 970 N.E.2d at 245
    (requiring a rule to be
    reduced to writing and introduced into evidence “to enable this court to fairly
    and reasonably review the determination that an employee was discharged for
    ‘just cause’ for the knowing violation of a rule”). Additionally, Employer’s
    director of human resources testified that the rule against insubordination
    applies equally to all employees—regardless of whether full-time or part-time.
    See 
    id. (“In order
    to evaluate uniformity one must first define the class of
    persons against whom uniformity is measured.”). Thus, there is sufficient
    evidence to support the determination that Employer’s rule is uniformly
    enforced.
    [19]   Riley further contends that her alleged insubordination was merely “a pretext
    for discrimination and retaliation against [her] for her disability and for her
    taking substantial FMLA leave that she was entitled to by law.” (Appellant’s
    Br. p. 13). 2 During the hearing, CEO Cook repeatedly stated that Riley’s
    2
    We decline to address the numerous arguments posited by Riley which have no relevance or basis in the
    record, such as her bald assertion that CEO Cook failed “to engage in an interactive process to find a
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015       Page 11 of 14
    discharge was based entirely on her insubordination and was in no way related
    to her FMLA leave. Thus, Riley’s argument is nothing more than a request
    that we reweigh the evidence and judge witness credibility, which we will not
    do. It was entirely within the discretion of the ALJ—and, in turn, the Review
    Board—to find CEO Cook’s testimony to be more credible than Riley’s.
    III. Due Process
    [20]   Riley next claims that she was “denied her rights to a fair hearing and an
    impartial tribunal.” (Appellant’s Br. p. 28). We find her argument is
    tantamount to a claim that she was denied due process. It is well established
    that “[t]he fundamental requirement of due process is the opportunity to be
    heard at a meaningful time and in a meaningful manner.” Wolf Lake Pub, Inc. v.
    Review Bd. of Ind. Dep’t of Workforce Development, 
    930 N.E.2d 1138
    , 1141 (Ind.
    Ct. App. 2010) (alteration in original). Whether a party was denied due process
    is a question of law, which our court reviews de novo. 
    Id. [21] First,
    Riley asserts that the ALJ improperly excluded and ignored evidence
    regarding the “real reasons” behind Riley’s termination—i.e., Riley’s disability,
    retaliation for Riley taking FMLA leave, and retaliation for Riley “going ‘over
    the head’” of CEO Cook by complaining to the Indianapolis office.
    (Appellant’s Br. pp. 28-29). “In general, the Indiana Rules of Trial Procedure
    and the Indiana Rules of Evidence shall govern proceedings before an [ALJ] or
    reasonable accommodation for [Riley’s] bipolar disorder, especially when it was aggravated by the CEO, and
    the retaliation against [Riley] because of her complaints.” (Appellant’s Br. p. 18).
    Court of Appeals of Indiana | Memorandum Decision | 93A02-1411-EX-800 | August 7, 2015       Page 12 of 14
    the [R]eview [B]oard.” 646 IAC § 5-10-5(a). The parties are afforded an
    opportunity to “present evidence as the [ALJ] deems necessary for determining
    the substantial rights of the parties.” 646 IAC § 5-10-5(a). In this case, the ALJ
    considered Employer’s testimony that Riley was fired for insubordination based
    on her failure to report to CEO Cook’s office, and the ALJ also heard Riley’s
    testimony that she believed she was terminated out of retaliation and
    discrimination. Because it is the role of the ALJ, not this court, to weigh the
    evidence, it was within the discretion of the ALJ to find Employer’s testimony
    more credible and to subsequently limit the testimony to the events directly
    relating to Riley’s discharge. See Ind. Evidence Rule 401 (stating that evidence
    is relevant, in part, if “the fact is of consequence in determining the action”);
    Evid. R. 402 (excluding irrelevant evidence).
    [22]   Second, Riley alleges that the ALJ “failed to be impartial by repeatedly asking
    leading questions in favor of the Employer” and “refused to allow [Riley] to ask
    questions on the same subjects.” (Appellant’s Br. p. 29). We find no merit in
    this argument. It is the prerogative of the ALJ to “examine all witnesses” in
    order to resolve the case. 646 IAC § 5-10-5(a)(1). In determining whether
    information concerning Riley’s FMLA leave was relevant, the ALJ directly
    asked Employer whether the FMLA leave had any bearing on its decision to
    terminate Riley. In turn, the ALJ also questioned Riley as to why she believed
    she was terminated and afforded Riley an ample opportunity to explain her
    opinion that she was fired in retaliation for contacting the Indianapolis office
    and for taking FMLA leave. We again reiterate that it was within the discretion
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    of the hearing officer to credit Employer’s testimony that Riley was terminated
    solely due to her insubordination. It is well settled that “[d]ue process requires
    a neutral, unbiased decision maker in” administrative determinations. Perry-
    Worth Concerned Citizens v. Bd. of Comm’rs of Boone Cnty., 
    723 N.E.2d 457
    , 460
    (Ind. Ct. App. 2000), trans. denied. Here, we find that Riley has failed to
    demonstrate that the ALJ acted in a biased or prejudicial manner; thus, there is
    no due process violation.
    CONCLUSION
    [23]   Based on the foregoing, we conclude that there is substantial evidence to
    establish that Riley was terminated for just cause and is therefore ineligible for
    unemployment compensation benefits. We further conclude that Riley’s due
    process rights were not violated.
    [24]   Affirmed.
    [25]   Bailey, J. and Barnes, J. concur
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