Erica Williams v. Favored, LLC and Division of Employment Security , 2014 Mo. App. LEXIS 1074 ( 2014 )

In the Missouri Court of Appeals
Eastern District
DIVISION ONE
ERICA WILLIAMS, ) No. ED101280
)
Appellant, ) Appeal from the Labor and
) Industrial Relations Commission
vs. )
)
FAVORED, LLC and )
DIVISION OF )
EMPLOYMENT SECURITY, )
) FILED: September 30, 2014
Respondents. )
OPINION
Erica Williams appeals the decision of the Labor and Industrial Relations
Commission denying her claim for unemployment compensation. We reverse and remand
for entry of an award of benefits.
Background
Ms. Williams was a certified early childhood teacher at the Good Shepherd Infant
& Toddler Center, operated by Favored, LLC (Employer), from October 2012 until her
resignation in May 2013. Williams resigned because Employer was violating state
regulations regarding child-to-staff ratios and dismissed her concerns to that effect.
Williams filed a claim for unemployment benefits through the Division of Employment
Security. A deputy for the Division determined that she was disqualified from waiting
week credit because she voluntarily resigned without good cause. Williams appealed that
determination to the Appeals Tribunal, which heard testimony from Williams,
Employer’s director, Ms. Collins, and an assistant teacher, Ms. Brown.
Williams testified that Employer frequently exceeded child-to-staff ratios,
neglected to conduct mandatory background checks on employees and volunteers, and
insisted that staff answer all phone calls, forcing them to leave children unattended.
Williams’s classroom ratio was 1:10 or 1:16 depending on the ages of the children at a
given time,1 but she sometimes had as many as 26 children in her room. Williams raised
her concerns privately and at staff meetings in March and May 2013. Collins recalled
only the latter and responded that Employer was in compliance by virtue of state
authorization for “overlap capacity,” which allows facilities to exceed overall licensed
capacity by one-third for up to two hours but actually does not override individual
classroom limits.2 Williams also testified that Collins threatened to “harden her heart”
upon further complaints. Williams submitted her resignation the day after that staff
meeting. She conceded that she didn’t contact the Department of Health and Senior
Services before quitting but explained, “I just simply didn’t agree with what was going
on.”
Collins testified that she hired Ms. Brown in February 2013 in order to assist
Williams and other staff and satisfy ratio requirements. Ms. Brown testified that she
wasn’t familiar with the state regulations and didn’t always count children to ensure
compliance, but she sometimes helped Williams when there were over 20 children in the
classroom. Employer’s log indicates that Brown was off work at least 20 days when
Williams worked during the relevant period. Collins testified that, although she insisted
1
See 19 CSR 30-62-112.
2
See 19 CSR 30-62.162.
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that phones be answered by the third ring, she never instructed teachers to leave children
unattended. Collins conceded that she failed to conduct a background check on Williams.
The Commission found Ms. Collins’s testimony credible but also was “convinced,
though, that [Williams] believed [E]mployer was not in technical compliance with certain
regulations.” It further found, “although during some hours of the day the number of
children at the facility exceeded the regulatory ratio,” Employer “believed it was in
compliance ... due to [the] overlap capacity exception.” (emphasis added) Ultimately the
Commission deemed fatal that Williams “did not, prior to submitting her resignation,
seek the assistance or intervention of the Missouri Department of Health and Senior
Services … to resolve her concerns,” further reasoning, “most average and reasonable
employees would have sought the advice of the applicable regulatory agency, regarding
both compliance and any personal liability questions, before simply quitting.” Finally,
the Commission did not find “reasonable or substantial” Williams’s concern that
Employer failed to perform her background check, as mandated by state regulation,3
because her record was clean.
Standard of Review
Our standard of review is set forth in §288.210 RSMo. An appellate court shall
only review questions of law and may modify, reverse, remand or set aside an award only
if the Commission acted without or in excess of its powers, the award was procured by
fraud, the facts found by the Commission do not support the award, or there was not
sufficient competent evidence in the record to warrant the making of the award.
§288.210. We examine the whole record to determine whether there is sufficient
competent and substantial evidence to support the award. Scrivener Oil Co. v. Div. of
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See 19 CSR 30-62.102(1).
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Employment Sec., 184 S.W.3d 635, 638 (Mo. App. S.D. 2006). We defer to the
Commission’s determination regarding weight of the evidence and credibility of
witnesses, and we will not substitute our own judgment for that of the Commission. Id.
However, whether an employee had good cause to leave her employment is a question of
law, which we review de novo. Quik’N’Tasty Foods, Inc. v. Division of Employment
Security, 17 S.W.3d 620, 624 (Mo. App. W.D. 2000).
Discussion
Under Missouri employment security law, a claimant is disqualified from benefits
if she “left work voluntarily without good cause attributable to such work or to the
claimant’s employer.” §288.050.1(1). “Good cause” is determined on a case-by-case
basis, and the employee bears the burden of proof. Darr v. Roberts Mktg. Grp., LLC, 428
S.W.3d 717, 724 (Mo. App. E.D. 2014). Good cause consists of circumstances that
would cause a reasonable person in a similar situation to leave employment. Id. Those
circumstances must be real, not imaginary, substantial, not trifling, and reasonable, not
whimsical. Id. The circumstances must be so compelling that a reasonably prudent person
would be justified in terminating employment. Id. Finally, an essential element of good
cause is good faith; the employee must prove that she made an effort to resolve the issue
before quitting. Id.
Williams asserts that the Commission erred in determining that she lacked good
cause to resign in that Employer was actually in violation of state regulations, regardless
of its mistaken belief to the contrary. Williams further asserts that the Commission erred
by requiring that she contact the state regulatory agency (in this case DHSS) as a criterion
of good faith.
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In support of her position, Williams cites Stevinson v. Labor and Industrial
Relations Comm’n, Div. of Employment Sec., 654 S.W.2d 373 (Mo. App. S.D. 1983).
There, a trucker was required to haul freight above the legal maximum. His employer
claimed to have permits from county commissioners to cross bridges along his route, but
none were adduced, and the court found no legal authority for such permits under
applicable law. The court opined, “it can scarcely be debated that, where one is called
upon to repeatedly violate the law, he has good cause to terminate his employment.” Id.
at 375. The employer also impugned the claimant’s effort to resolve the conflict, but the
court found “apparent [from the evidence] that the employer was not going to change its
manner of operating.” Id. Similarly here, Employer deemed itself in compliance with
state regulations despite its actual non-compliance, and Collins conveyed that she would
“harden her heart” in the face of further complaints.
Williams also relies on Tin Man Enterprises, Inc. v. Labor and Industrial
Relations Comm’n, 866 S.W.2d 147 (Mo. App. E.D. 1993). There, three employees
simultaneously resigned due to hazardous working conditions. The employer disputed
their good faith in that their previous complaints to management were minimal and they
didn’t contact OSHA before quitting. This court noted, however, that the problems were
obvious and continuous, management had rejected their complaints, and “there is no
requirement that an employee must complain to OSHA before quitting employment.” Id.
at 149. The foregoing cases do not support the Commission’s sole rationale that
Williams lacked good cause because she failed to contact DHSS.
In response, the Division defends the Commission’s reliance on Central Missouri
Paving Co., Inc. v. Labor and Industrial Relations Comm’n, 575 S.W.2d 889 (Mo. App.
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1978). There, the parties disputed whether the prevailing wage law was applicable to the
work in question, and the law itself was unclear. The employer stopped paying workers
the prevailing wage, so three employees issued an ultimatum and soon after resigned. On
those facts, the court held that the employees should have made a greater effort to discuss
the problem with the employer or consult the state highway commission before quitting.
Unlike Central Paving, here there is no dispute that Employer was in violation of state
regulations and further dialogue with Employer was futile. On the present facts, the
Commission’s determination that Williams lacked good faith because she failed to
contact DHSS before resigning does not comport with Missouri precedent as stated in
Stevinson and Tin Man and therefore warrants reversal.
Although not addressed by the Commission in its decision, the Division also
argues that Williams’s separation should be deemed purely voluntary, without even
reaching a good-cause analysis, because she didn’t specify an attributable reason for her
departure in her formal resignation letter. Williams’s letter simply stated that she wished
to explore another opportunity, her “tenure at [Employer] had challenges,” and she
thanked Employer for the experience. In turn, Employer provided two glowing letters of
reference. The Division would have the court turn these facts against Williams to hold
that her letter constitutes a voluntary quit wholly absent of good cause. This implication -
that an employee must burn bridges and blow whistles in order to qualify for
unemployment compensation - ignores reality and an established legal framework. The
General Assembly expressly intended that Chapter 288 “be liberally construed to
accomplish its purpose to promote employment security … by providing for the payment
of compensation to individuals in respect to their compensation.” §288.020.2. To the
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same end, Missouri precedent mandates that §288.050.1(1) be “strictly and narrowly
construed in favor of finding that an employee is entitled to compensation.” Darr v.
Roberts Marketing Group, LLC, 428 S.W.3d 717 (Mo. App. E.D. 2014). Though
described in opposing terms, both statute and jurisprudence prescribe standards favoring
the employee.
Moreover, the Commission didn’t consider Williams’s letter in a vacuum, as the
Division advocates, but instead examined the whole record and found that Williams
resigned due to Employer’s violations of classroom ratios, a phone policy that forced
staff to leave children unattended, Collins’s threat to “harden her heart” against further
complaints, and Employer’s failure to conduct mandatory background checks. Though
the Commission ultimately found some of Williams’s complaints immaterial, it
nonetheless accepted them as sincere for purposes of its good cause analysis. “The causal
connection between [a claimant’s] quitting and [her] reason for doing so is a finding of
fact which will not be disturbed by this court when such a finding, as in this case, is
supported by the record.” Tin Man, 866 S.W.2d at 150.
Finally, the Commission’s specific findings about Williams’s complaints do not
undermine their validity for purposes of good cause. First and critically, though the
Commission found that “Employer believed it was in compliance with such regulations,”
it also found that Employer was actually in violation of them. (Specifically, the Tribunal
noted that, “during some hours of the day the number of children at the facility exceeded
the regulatory ratio.”) Second, the Commission’s finding that Collins didn’t expressly
instruct staff to leave children unattended does not belie Williams’s testimony that they
were forced to do so as a practical result of Collins’s strict phone policy. Third, though
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the Commission found that Collins’s “’harden my heart’ comment was not intended as a
threat,” the implicit finding that Collins made the comment supports Williams’s
contention that further attempts at resolution would have been futile. Finally, the
Commission’s finding that Employer’s failure to complete a background check on
Williams was not a reasonable or substantial concern ignores the gravity of Employer’s
regulatory violation in this respect, the larger pattern of Employer practices depicted by
the record as a whole, and thus the full context of Williams’s decision to separate.
In sum, the facts in the record support the Commission’s determination that
Williams resigned for reasons attributable to Employer. As a matter of law, however, the
Commission erred in concluding that Williams lacked good cause to resign.
Conclusion
The Commission’s decision is reversed and the cause is remanded for entry of an
award of unemployment compensation benefits.
____________________________________
CLIFFORD H. AHRENS, Judge
Lawrence E. Mooney, P.J., concurs.
Glenn A. Norton, J., concurs.
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