Watlington v. Dep't of Soc. Servs. Rockingham Cty.Â

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA16-1038
Filed: 4 April 2017
Office of Administrative Hearings, No. 16 OSP 00297
GLORIA R. WATLINGTON, Petitioner,
v.
DEPARTMENT OF SOCIAL SERVICES ROCKINGHAM COUNTY, Respondent.
Appeal by respondent from final decision entered 5 July 2016 by Judge J.
Randall May in the Office of Administrative Hearings. Heard in the Court of Appeals
8 March 2017.
Mark Hayes for petitioner-appellee-cross-appellant.
Rockingham County Attorney’s Office, by Emily Sloop, for respondent-
appellant-cross-appellee.
TYSON, Judge.
Rockingham County Department of Social Services (“RCDSS”) appeals and
Gloria Watlington (“Watlington”) cross-appeals from a final decision affirming
Watlington’s termination and ordering RCDSS to provide back pay salary to
Watlington due to a procedural violation. We affirm in part, reverse in part, and
remand.
I. Factual Background
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RCDSS hired Watlington as a Community Social Services Technician on 9
January 2012. Her primary responsibilities included providing transportation to
families and children served by RCDSS, supervising case visits between parents and
children in RCDSS’ custody, and providing case visit reports to RCDSS social
workers.
When Watlington was hired, RCDSS provided her with a copy of Rockingham
County’s Personnel Policy (“RCPP”). Watlington also attended an orientation for new
employees. The personnel policy and orientation described appropriate employee
behavior, including RCDSS’ policies on unacceptable personal conduct and the
acceptance of gifts and favors.
On 15 April 2013, the Rockingham County Board of Commissioners passed a
resolution to establish a consolidated human services agency, which consolidated its
departments of public health and social services. The resolution, along with a
subsequent resolution passed on 3 August 2013, clarified employees of the
consolidated human services agency remained subject to the North Carolina Human
Resources Act (“SHRA”) in most circumstances. The resolutions provided that for
those areas of policy and procedures where the RCPP had been recognized by the
State as substantially equivalent to the SHRA, the employees are governed
exclusively by the RCPP. RCDSS presented no evidence demonstrating the State had
recognized the RCPP as substantially equivalent.
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In December 2015, Watlington supervised a RCDSS custody visit between
P.H. and her daughter. P.H. testified she wanted to do something nice for Watlington,
because Watlington “had been real nice in letting us have extra time on our visits and
been encouraging that we would be able to be reunited.” P.H. purchased an
inexpensive jewelry set, which Watlington accepted.
When Watlington’s supervisor informed Watlington the gift violated RCDSS’
policy, she immediately surrendered the jewelry set to RCDSS. Watlington’s
supervisor notified Debbie McGuire, the Director of RCDSS, of the occurrence. On 9
December 2015, Watlington was placed on administrative leave with pay, pending
investigation and review of allegations made against her regarding violation of the
RCPP’s provision prohibiting the acceptance of gifts.
During the investigation, additional allegations came forth regarding
Watlington’s personal conduct. These allegations included she had: accepted food and
beverages from RCDSS clientele on more than one occasion; used Social Security
Income (“SSI”) money belonging to a child in RCDSS custody to purchase food for
herself; accepted a cash loan of sixty dollars from a foster parent; and removed a
bassinet stored at RCDSS without permission and gave it to another foster family.
On 11 December 2015, RCDSS provided Watlington a written notice of a pre-
dismissal conference to be held that afternoon to discuss a recommendation for her
dismissal, due to “unacceptable personal conduct.” The notice listed the specific
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reasons for the recommendation of dismissal. Watlington, her supervisor, and
McGuire attended the meeting and discussed the documented allegations.
On 14 December 2015, Watlington received a written notice of dismissal from
employment. The notice again included the specific reasons for Watlington’s
dismissal and informed her of her right to appeal to the County Manager, Lance
Metzler. Watlington appealed.
Metzler upheld Watlington’s termination and notified her by letter on 15
December 2015. The letter did not inform Watlington of the specific reasons why
Metzler was upholding her termination or that his letter was public record.
Watlington appealed her termination to the North Carolina Office of Administrative
Hearings and Review (“OAH”) by filing a Petition for a Contested Case Hearing on
11 January 2016.
The case was heard before the administrative law judge (“the ALJ”) on 23 May
2016. After the hearing and reviewing the parties’ briefs and proposed orders, the
ALJ entered his final decision and made the following findings of fact:
13. While employed by Respondent, Petitioner engaged in
the following conduct: (1) accepted a loan in the amount of
sixty dollars ($ 60.00) offered by a foster parent between
two (2) and three (3) years prior to her termination by
Respondent; (2) used approximately six dollars ($ 6.00) of
a minor child’s money to purchase food for herself while
transporting the minor child across the state at the request
of her supervisor, which Petitioner repaid to Respondent
within one (1) week; (3) consumed leftover food purchased
by a foster parent for herself and a minor child when
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offered by the foster parent; (4) gifted a bassinet to a foster
family being served by Respondent from an area where
Respondent keeps both donations and property assigned to
particular families under its supervision, and upon being
notified of a problem, retrieved said bassinet and returned
it to Respondent; (5) accepted a slice of cake or cupcakes
offered by a foster family at a minor child’s birthday party;
and (6) accepted a wrapped pair of earrings from a foster
parent on behalf of her child, which were immediately
returned upon an issue being raised by Respondent.
14. Prior to Petitioner’s voluntary disclosure of item
number six (6) above to a co-worker, Respondent had taken
no formal disciplinary action against Petitioner, despite
being aware of at least two (2) of the same aforementioned
allegations.
15. Prior to Respondent’s initiation of an investigation into
Petitioner’s conduct, no witness called to testify by
Respondent had reported items (1), (3), or (5) of the
aforementioned conduct as concerning to them, violating
the RCPP; or asked Respondent to initiate formal
discipline against Petitioner based on such conduct despite
being fully aware of them.
16. Respondent offered no evidence that any of the
aforementioned conduct by Petitioner: (1) negatively
impacted her job performance; (2) influenced her job
performance, recommendations, or reporting; (3)
diminished the reputation of Respondent in the
community; or (4) led to tangible financial, legal, or
regulatory consequences for Respondent.
...
18. On or about August 5, 2013, the Rockingham County
Board of Commissioners passed an amending and
clarifying resolution stating that “[e]mployees of the
Consolidated Human Services Agency remain subject to
the State Personnel Act. In those areas where the
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Rockingham County Personnel Policy has been recognized
by the state as ‘substantially equivalent,’ the employees
will be governed by the provisions of the [RCPP].”
19. Respondent offered no evidence demonstrating that it
is exempt from the provisions of the State Human
Resources Act (“SHRA”), codified at N.C.G.S. § 126-1 et seq,
as implemented by the North Carolina Administrative
Code at 25 NCAC 01J.0101 et seq, or that its disciplinary
or grievance procedures have been recognized by the State
Human Resources Commission as substantially
equivalent.
The ALJ also made the following conclusions of law:
1. Petitioner is subject to the protections of the SHRA.
2. Due to the language of the two (2) resolutions passed by
the Rockingham County Board of Commissioners and the
absence of an exemption by the State Human Resources
Commission respecting its disciplinary or grievance
procedures, Respondent’s conduct as to disciplinary or
grievance procedures is controlled by Title 25, Subchapter
J, of the North Carolina Administrative Code.
3. In cases in which a state employee is disciplined for
“unacceptable personal conduct” that does not involve
criminal conduct, the North Carolina Court of Appeals
interpreted the North Carolina Supreme Court’s decision
in Carroll as adopting a “commensurate discipline”
approach. See Warren v. N.C. Dep’t of Crime Control and
Pub. Safety, 726 S.E.2d 920, 924 (N.C. App. 2012).
According to Warren, “the proper analytical approach is to
first determine whether the employee engaged in the
conduct the employer alleges. The second inquiry is
whether the employee’s conduct falls within one of the
categories of unacceptable personal conduct provided by
the Administrative Code. Unacceptable personal conduct
does not necessarily establish just cause for all types of
discipline. If the employee’s act qualifies as a type of
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unacceptable conduct, the tribunal proceeds to the third
inquiry: whether that misconduct amounted to just cause
for the disciplinary action taken.”
4. Respondent failed to comply with the procedural
requirements for dismissing Petitioner from employment
for unacceptable personal conduct by not providing specific
written reasons and written details in the Final Agency
Decision.
5. 25 NCAC 0lB .0432(b) provides, “[f]ailure to give specific
reasons for dismissal, demotion or suspension without pay
shall be deemed a procedural violation. Back pay or
attorney’s fees, or both, may be awarded for such a period
of time as the Commission determines, in its discretion, to
be appropriate under all the circumstances.”
6. The December 15, 2015 letter written by Rockingham
County Manager Lance L. Metzler constitutes the Final
Agency Decision for the purposes of this action.
7. Based on the language of the Final Agency Decision and
pursuant to 25 NCAC 1J.0613(4)(h), Respondent lacked
procedural just cause to terminate Petitioner.
The ALJ’s final decision affirmed Watlington’s termination, but ordered
RCDSS to pay Watlington back pay due to a procedural violation. RCDSS appeals.
Watlington cross-appeals.
II. Jurisdiction
Jurisdiction lies in this Court pursuant to N.C. Gen. Stat. § 7A-29(a) (2015).
III. Issues
The appeal and cross-appeal request this Court to address whether the ALJ
erred by: (1) holding Watlington was a career State employee subject to the provisions
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of the SHRA and not the local RCPP; (2) holding Title 25, Subchapter J of the North
Carolina Administrative Code governs the case; (3) affirming Watlington’s
termination; and (4) awarding back pay to Watlington for an alleged procedural
violation.
IV. Standard of Review
N.C. Gen. Stat. § 150B-51 (2015) governs the scope and standard of this Court’s
review of an administrative agency’s final decision. Harris v. N.C. Dep’t of Pub.
Safety, No. COA16-341, __ N.C. App. __, __, __ S.E.2d __, __ (filed Mar. 7, 2017);
Overcash v. N.C. Dep’t of Env’t & Natural Res., 179 N.C. App. 697, 702, 635 S.E.2d
442, 446 (2006). The standard of review is dictated by the substantive nature of each
assignment of error. N.C. Dep’t of Env’t & Natural Res. v. Carroll, 358 N.C. 649, 658,
599 S.E.2d 888, 894 (2004).
N.C. Gen. Stat. § 150B-51(b) provides:
The court reviewing a final decision may affirm the
decision or remand the case for further proceedings. It may
also reverse or modify the decision if the substantial rights
of the petitioners may have been prejudiced because the
findings, inferences, conclusions, or decisions are:
(1) In violation of constitutional provisions;
(2) In excess of the statutory authority or jurisdiction of the
agency or administrative law judge;
(3) Made upon unlawful procedure;
(4) Affected by other error of law;
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(5) Unsupported by substantial evidence admissible under
G.S. 150B-29(a), 150B-30, or 150B-31 in view of the entire
record as submitted; or
(6) Arbitrary, capricious, or an abuse of discretion.
“It is well settled that in cases appealed from administrative tribunals,
questions of law receive de novo review, whereas fact-intensive issues such as
sufficiency of the evidence to support an agency’s decision are reviewed under the
whole-record test.” Carroll, 358 N.C. at 659, 599 S.E.2d at 894-95 (citation and
quotation marks omitted).
The court engages in de novo review where the error asserted is pursuant to §
150B-51(b)(1), (2), (3), or (4). N.C. Gen. Stat. § 150B-51(c). “Under the de novo
standard of review, the trial court considers the matter anew and freely substitutes
its own judgment for the agency’s.” Overcash, 179 N.C. App. at 703, 635 S.E.2d at 446(brackets, citation, and quotations marks omitted).
On the other hand, where the error asserted is pursuant to N.C. Gen. Stat. §
150B-51(b)(5) & (6), the reviewing court applies the “whole record standard of
review.” N.C. Gen. Stat. § 150B-51(c). Under the whole record test,
[The court] may not substitute its judgment for the
agency’s as between two conflicting views, even though it
could reasonably have reached a different result had it
reviewed the matter de novo. Rather, a court must
examine all the record evidence—that which detracts from
the agency’s findings and conclusions as well as that which
tends to support them—to determine whether there is
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substantial evidence to justify the agency’s decision.
Substantial evidence is relevant evidence a reasonable
mind might accept as adequate to support a conclusion.
Carroll, 358 N.C. at 660, 599 S.E.2d at 895 (citations and quotation marks omitted).
V. Career Employee Status and Applicability of the SHRA
RCDSS argues the findings of fact do not support the ALJ’s conclusion that
Watlington is subject to the provisions of the SHRA. RCDSS argues the ALJ failed
to make any findings to demonstrate Watlington was a “career State employee,” such
that “just cause” was required to support her termination. See N.C. Gen. Stat. § 126-
35(a) (2015).
The SHRA applies to all non-exempt State employees and certain local
government employees, including those who work for local social services
departments. N.C. Gen. Stat. § 126-5 (2015). The General Assembly has delegated
local governments the statutory authority to create a consolidated human services
agency pursuant to N.C. Gen. Stat. § 153A-77(b) (2015). These local employees are
not subject to the SHRA, unless the local government chooses to keep them subject to
the provisions of the SHRA upon consolidation. N.C. Gen. Stat. § 126-5.
A career State employee is defined as a State employee or a local government
employee subject to the SHRA who:
(1) Is in a permanent position with a permanent
appointment, and
(2) Has been continuously employed by the State of North
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Carolina or a local entity as provided in G.S. 126-5(a)(2) in
a position subject to the North Carolina Human Resources
Act for the immediate 12 preceding months.
N.C. Gen. Stat. § 126-1.1 (2015). Career State employees may only be “discharged,
suspended, or demoted for disciplinary reasons” upon a showing of “just cause.” N.C.
Gen. Stat. § 126-35(a); see 25 NCAC 01I.2301 (2016); 25 NCAC 01J.0604 (2016).
The final decision’s findings of fact show RCDSS hired Watlington as a
Community Social Services Technician on 9 January 2012. Her employment was
terminated on 15 December 2015. The findings also demonstrate the Rockingham
County Board of Commissioners passed resolutions leaving the employees of the
consolidated human services agency subject to the SHRA, except where the RCPP
had been recognized by the State as “substantially equivalent.” RCDSS failed to
present any evidence showing the State had recognized the RCPP as “substantially
equivalent” or that RCDSS was only required to follow the provisions on the RCPP in
order to terminate Watlington. These findings support the ALJ’s conclusion that
Watlington, as an employee of RCDSS, was subject to the SHRA.
Presuming arguendo, the findings were insufficient to support the ALJ’s
conclusion that Watlington was subject to the SHRA, we note RCDSS never argued
this issue before the ALJ. Rather, RCDSS’ proposed order and brief in support of its
order stated Watlington was “subject to the provisions of [the SHRA].” We also
acknowledge the ALJ’s order does not include any findings of fact showing Watlington
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was a career State employee. However, this issue was also not contested in the
hearing before the ALJ. RCDSS’ brief and proposed order explicitly state that
Watlington “was a career State employee.”
This Court has repeatedly held “‘the law does not permit parties to swap horses
between courts in order to get a better mount,’ meaning, of course, that a contention
not raised and argued in the trial court may not be raised and argued for the first
time in the appellate court.” Wood v. Weldon, 160 N.C. App. 697, 699, 586 S.E.2d 801,
803 (2003) (quoting Weil v. Herring, 207 N.C. 6, 10, 175 S.E. 836, 838 (1934)). RCDSS
never contested the application of the SHRA to Watlington nor Watlington’s status
as a career State employee prior to its arguments on appeal. We affirm the ALJ’s
conclusion that Watlington was a career State employee subject to the SHRA. As
such, RCDSS must show just cause exists for her termination.
V. Applicable Section of the North Carolina Administrative Code
The ALJ concluded Title 25, Subchapter J of the North Carolina
Administrative Code (“Subchapter J”) governs this case. RCDSS argues Title 25,
Subchapter I (“Subchapter I”) controls, because Watlington was considered a local
government employee. To provide clarity for the ALJ on remand, we address when
these respective subchapters of the North Carolina Administrative Code apply.
A. Review of Title 25, Subchapters I and J
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Title 25 of the North Carolina Administrative Code was promulgated pursuant
to the SHRA, which established:
a system of personnel administration under the Governor,
based on accepted principles of personnel administration
and applying the best methods as evolved in government
and industry. It is also the intent of this Chapter that this
system of personnel administration shall apply to local
employees paid entirely or in part from federal funds,
except to the extent that local governing boards are
authorized by this Chapter to establish local rules, local
pay plans, and local personnel systems.
N.C. Gen. Stat. § 126-1 (2015). The State Human Resources Commission establishes
the procedures and rules governing many aspects of this personnel system. N.C. Gen.
Stat. § 126-4 (2015).
Title 25 contains the rules adopted by the Commission and includes distinct
subchapters on various personnel topics. Relevant to this appeal, Subchapter J,
“Employee Relations,” contains a section “Disciplinary Action: Suspension and
Dismissal,” which provides the procedures and rules regarding just cause and
dismissals for unacceptable personal conduct. 25 NCAC 01J.0603-.0618 (2016)
Subchapter I, “Service to Local Governments,” provides the procedures and
rules specific to the personnel system developed for local government employees,
including subsections on recruitment and selection, classification, and compensation.
See 25 NCAC 01I.1800, .1900, and .2100 (2016). Subchapter I includes a separate
subsection on “Disciplinary Action: Suspension, Dismissal and Appeals,” which
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includes rules regarding just cause and dismissal for unacceptable personal conduct.
25 NCAC 01I.2301 and .2304 (2016). These rules vary slightly from the rules and
procedures stated under Subchapter J. See 25 NCAC 01J.0603-.0618.
Subchapter I begins with the “Applicability” section:
[The SHRA] provides for the establishment of a system of
personnel administration applicable to certain local
employees paid entirely or in part from federal funds.
Local governing boards are authorized by G.S. 126 to
establish personnel systems which will fully comply with
the applicable federal standards and then may remove
such employees from the state system to their own system.
25 NCAC 01I.1701 (2016).
In this case, the parties assert different interpretations of 25 NCAC 01I.1701.
RCDSS argues in its brief this provision of Subchapter I is “merely implementing
N.C. Gen. Stat. § 126-1, which allows local governing boards to establish local
personnel systems if they so choose.” RCDSS asserts Subchapter J applies to State
employees and Subchapter I applies to local government employees, unless the local
government removes those employees to its own separate system not governed by
either Subchapter I or J. On the other hand, Watlington argues 25 NCAC 01I.1701
gives local governments the authority to remove certain employees from the State
system, Subchapter J, to the local government system under Subchapter I.
We agree with RCDSS. As 25 NCAC 01I.1701 notes, the SHRA provided the
State Human Resources Commission with the authority to establish a personnel
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system for certain local government employees. The rules for that system are
contained within Subchapter I. The second sentence in 25 NCAC 01I.1701 simply
recognizes the ability of a local government to remove its employees to its own,
separate system, if and when certain requirements are met.
Based upon our review of the case law, the SHRA, and the entirety of Title 25,
we find Subchapter J applies to State employees and Subchapter I applies to local
government employees. See, e.g., Blackburn v. Dep’t of Pub. Safety, __ N.C. App. __,
784 S.E.2d 509, 522 (2016) (applying Subchapter J to a former State employee of the
Department of Public Safety); Ramsey v. N.C. Div. of Motor Vehicles, 184 N.C. App.
713, 718-19, 647 S.E.2d 125, 128-29 (2007) (applying Subchapter J to a former State
employee of the Division of Motor Vehicles); Steeves v. Scotland Cnty. Bd. of Health,
152 N.C. App. 400, 406-07, 567 S.E.2d 817, 821-22 (2002) (applying Subchapter I to
a former Scotland County Health Director, a career State employee under the SHRA,
who was dismissed for “unacceptable personal conduct”); Fuqua v. Rockingham Cnty.
Bd. of Social Servs., 125 N.C. App. 66, 71, 479 S.E.2d 273, 276 (1997) (applying
Subchapter I to a former director of the Rockingham County Department of Social
Services, who was dismissed based on “unacceptable personal conduct”).
B. Applicability to this Case
Finding of Fact 19 of the ALJ’s final decision states:
19. Respondent offered no evidence demonstrating that it
is exempt from the provisions of the State Human
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Resources Act (“SHRA”), codified at N.C.G.S. § 126-1 et seq,
as implemented by the North Carolina Administrative Code
at 25 NCAC 01J.0101 et seq, or that its disciplinary or
grievance procedures have been recognized by the State
Human Resources Commission as substantially
equivalent. (emphasis supplied).
The ALJ further stated in Conclusion of Law 2 that due to the resolutions
passed by the Rockingham County Board of Commissions, and in absence of an
exemption, “Respondent’s conduct as to disciplinary or grievance procedures is
controlled by [Subchapter J].”
Both Finding 19’s assertion “as implemented by the North Carolina
Administrative Code at 25 NCAC 01J.0101 et seq” and Conclusion of Law 2 are
reviewed de novo on appeal. See Zimmerman v. Appalachian State Univ., 149 N.C.
App. 121, 131, 560 S.E.2d 374, 380-81 (2002) (“We will review conclusions of law de
novo on appeal regardless of their label.”).
We hold Subchapter I is applicable in this case, and reverse the ALJ’s
conclusions that Subchapter J applies. 25 NCAC 01A.0103(6) (2016) provides the
definition of local government employees as “those employees of local social services
departments, public health departments, mental health centers and local offices of
civil preparedness which receive federal grant-in-aid funds.” The evidence and the
ALJ’s findings of fact demonstrate Watlington’s position fits this definition as an
employee of a local department of social services, RCDSS. As such, Subchapter I, and
not Subchapter J, governs both the substantive just cause determination, the analysis
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of whether any procedural violations occurred in this case, and the remedies
available.
VII. Just Cause Analysis
N.C. Gen. Stat. § 150B-34 (2015) provides that “[i]n each contested case the
administrative law judge shall make a final decision or order that contains findings
of fact and conclusions of law.” The ALJ’s duties are further clarified by 26 NCAC
3.0127 (2016) stating the ALJ’s final decision “shall fully dispose of all issues required
to resolve the case” and is required to contain “findings of fact” and “conclusions of
law based on the findings of fact and applicable constitutional principles, statutes,
rules, or federal regulations.”
As a career State employee subject to the SHRA, Watlington’s employment
may only be “discharged, suspended, or demoted for disciplinary reasons” upon a
showing of “just cause.” N.C. Gen. Stat. § 126-35(a). In this case, the ALJ articulated
the correct three-part Warren test applicable to terminations alleging unacceptable
personal conduct:
The proper analytical approach is to first determine
whether the employee engaged in the conduct the employer
alleges. The second inquiry is whether the employee’s
conduct falls within one of the categories of unacceptable
personal conduct provided by the Administrative Code.
Unacceptable personal conduct does not necessarily
establish just cause for all types of discipline. If the
employee’s act qualifies as a type of unacceptable conduct,
the tribunal proceeds to the third inquiry: whether that
misconduct amounted to just cause for the disciplinary
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action taken.
Warren v. N.C. Dep’t of Crime Control and Pub. Safety, 221 N.C. App. 376, 382-83,
726 S.E.2d 920, 925 (2012); see Harris, __ N.C. App. at __, __ S.E.2d at __.
Just cause must be determined based “upon an examination of the facts and
circumstances of each individual case. Inevitably, this inquiry requires an irreducible
act of judgment that cannot always be satisfied by the mechanical application of rules
and regulations.” Harris, __ N.C. App. at __, __ S.E.2d at __ (citation and quotation
marks omitted).
This Court has noted:
In an administrative proceeding, it is the prerogative and
duty of the ALJ, once all the evidence has been presented
and considered, to determine the weight and sufficiency of
the evidence and the credibility of the witnesses, to draw
inferences from the facts, and to appraise conflicting and
circumstantial evidence. The credibility of witnesses and
the probative value of particular testimony are for the ALJ
to determine, and the ALJ may accept or reject in whole or
part the testimony of any witness.
Id. at __, __ S.E.2d at __ (brackets, citations, and quotation marks omitted).
Here, the ALJ’s final decision addressed the first prong of the Warren test in
Finding of Fact 13. The ALJ found Watlington had engaged in the conduct as RCDSS
alleged. This finding of fact is not disputed by either party and is binding on appeal.
See Koufman v. Koufman, 330 N.C. 93, 97, 408 S.E.2d 729, 731 (1991).
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However, the ALJ failed to make any findings of fact or conclusions of law
applying the second and third prongs of the Warren test to the facts of this case. See
Warren, 221 N.C. App. at 382-83, 726 S.E.2d at 925. Nothing in the final decision
indicates Watlington’s conduct as found by the ALJ amounted to unacceptable
personal conduct. Furthermore, as both the RCDSS and Watlington acknowledge in
their briefs, no conclusion of law asserts RCDSS had substantive just cause for any
disciplinary action against Watlington. Rather, under the last section of the order
labeled “Final Decision,” the ALJ simply states “Petitioner’s termination is affirmed.”
This statement does not constitute an acceptable conclusion of law that RCDSS
terminated Watlington based upon just cause. See id.Pursuant to N.C. Gen. Stat. § 150B-51, we remand the case to the ALJ to make
proper findings of fact and conclusions of law regarding: (1) whether Watlington’s
conduct constituted unacceptable personal conduct, and (2) “whether that misconduct
amounted to just cause for the disciplinary action taken.” Id.; see Harris, __ N.C. App.
at __, __ S.E.2d at __. In making such determinations on remand, the ALJ is bound
by the definitions and procedural requirements of Subchapter I.
VIII. Award of Back Pay
Back pay is not provided as a remedy for a procedural violation under
Subchapter I. Both parties agree 25 NCAC 01B.0432(b) expired in 2014 and no
provision has been promulgated in its place. Furthermore, we note N.C. Gen. Stat. §
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150B-33(11), which is cited by the ALJ in support of the award of back pay, does not
provide the ALJ with independent authority to award back pay. N.C. Gen. Stat. §
150B-33(11) allows the ALJ to award attorney’s fees or witnesses’ fees under certain
circumstances, one of which is when the ALJ awards back pay as provided in the
General Statutes and North Carolina Administrative Code. Because we find that
Subchapter I, and not Subchapter J, governs this case, we reverse the ALJ’s award
for back pay.
Upon remand, the ALJ should determine whether a procedural violation
occurred under Subchapter I. If the ALJ determines a procedural violation occurred,
the ALJ is limited to those remedies provided in Subchapter I.
IX. Conclusion
RCDSS never contested Watlington’s status as a career State employee or that
she is subject to the provisions of the SHRA. We affirm the ALJ’s conclusion of law
that Watlington was a career State employee subject to the SHRA, and as such
RCDSS must show just cause for her termination. We reverse the ALJ’s conclusion
of law that Subchapter J applies, and hold Subchapter I governs this case.
The ALJ failed to make appropriate findings of fact or conclusions of law to
allow us to review the substantive just cause determination. We remand to the ALJ
to make findings of fact and conclusions of law applying the three-step inquiry as set
out in Warren to the facts of this case. In doing so, the ALJ must apply the definitions
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WATLINGTON V. DEP’T OF SOC. SERVS. ROCKINGHAM CNTY.
Opinion of the Court
of just cause and unacceptable personal conduct found in Title 25, Subchapter I of the
North Carolina Administrative Code.
We reverse that portion of the ALJ’s order awarding Watlington back pay. On
remand, the ALJ should determine whether RCDSS committed a procedural violation
under Subchapter I. If a procedural violation exists, the ALJ is bound by and limited
to those remedies provided under Subchapter I. It is so ordered.
AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
Judges ELMORE and DIETZ concur.
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