Correctional Care, Inc. v. UCBR

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Correctional Care, Inc., :
: No. 2594 C.D. 2015
Petitioner : Submitted: June 17, 2016
:
v. :
:
Unemployment Compensation :
Board of Review, :
:
Respondent :
BEFORE: HONORABLE P. KEVIN BROBSON, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
HONORABLE JAMES GARDNER COLINS, Senior Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY JUDGE WOJCIK FILED: July 29, 2016
Correctional Care, Inc. (Employer) petitions for review of the
November 20, 2015 order of the Unemployment Compensation Board (Board),
which affirmed a referee’s decision and held that Melissa A. Cravath (Claimant)
was not ineligible for benefits under Section 402(e) of the Unemployment
Compensation Law (Law).1 We affirm.
1
Act of December 5, 1936, Second Ex. Sess., P.L. (1937), 2897, as amended, 43 P.S.
§802(e). Section 402(e) provides than an employee shall be ineligible for compensation for any
week in which her unemployment is due to her discharge or temporary suspension from work for
willful misconduct connected with her work.
While the Law does not define the term willful misconduct, our courts have
defined it as including: wanton or willful disregard for an employer’s interests; deliberate
violation of an employer’s rules; disregard for standards of behavior which an employer can
rightfully expect of an employee; or negligence indicating an intentional disregard of the
(Footnote continued on next page…)
Employer discharged Claimant on May 20, 2015. The local service
center granted her application for benefits, and Employer appealed. Following a
hearing, the referee affirmed the local service center’s determination. Employer
then appealed to the Board, arguing that Claimant had been discharged for
disqualifying willful misconduct. The Board resolved the conflicting evidence in
Claimant’s favor, affirmed the referee’s decision, and held that Claimant was not
ineligible for benefits under Section 402(e) of the Law.
The facts as found by the Board are as follows.
1. [Claimant] was last employed as a full-time
bookkeeper by [Employer] from March 17, 2014, at a
final rate of $17.00 per hour and her last day of work was
May 20, 2015.
2. [Employer] provides medical services to inmates at
correctional institutions.
3. [Employer] provides medical services to inmates at the
[Lackawanna County Prison] and the president, Dr.
Zaloga, had an office at that location.
4. [Claimant] worked at another location at Birney
Avenue in Moosic, PA, where medical records were kept
for the inmates.
5. Dr. Zaloga did not have a private medical facility
where he saw patients.
6. On December 15, 2014, [Employer] received a $2,500
penalty for untimely tax filings for 2014.
(continued…)
employer’s interest or an employee’s duties or obligations. Navickas v. Unemployment
Compensation Board of Review, 787 A.2d 284, 288 (Pa. 2001).
2
7. [Claimant] was responsible for processing of payroll
and making [Employer’s] tax filings biweekly.
8. As a result of the untimely tax filings, on December
17, 2014, Dr. Zaloga informed [Claimant] via an email
that “YOU are not to send NOTHING [sic] out of this
office without [the chief operating officer’s/COO’s]
PRIOR written approval. Failure to adhere to this
direction will result in your immediate termination for
cause.”
9. In March of 2015, [Employer] began providing
medical services to inmates at the Susquehanna County
Prison, in addition to the Lackawanna County Prison.
10. Services for the two prisons were provided under two
separate contracts, which raised issues for [Employer] in
regard to how overtime for employees working at both
locations should be allocated.
11. In May of 2015, [Claimant] came under the
supervision of a new COO.
12. In May of 2015, [Claimant] and the COO met with
[Employer’s] accountant and discussed how overtime
should be allocated. The COO advised [Claimant] that
she should not pay any overtime until he was able to
discuss the issue in the near future with Dr. Zaloga and
there was a consensus reached between the COO, the
accountant, the attorney and Dr. Zaloga.
13. The doctor ultimately directed [Claimant] to pay
employees straight time for any hours worked over 40 for
pay period ending May 6, 2015.
14. On May 15, 2015, [Claimant] received a medical
record for a patient via fax at [Employer’s] Birney
Avenue location.
15. [Claimant] assumed the medical record was for an
inmate at the Lackawanna County Prison because it had
the address for the Lackawanna County Prison on it.
3
16. The medical record was for a private patient of Dr.
Zaloga; however, [Claimant] was not aware that Dr.
Zaloga had private patients.
17. On May 16, 2015, Dr. Zaloga became aware that
[Claimant] faxed a medical record for his private patient
to the prison.
18. On May 18, 2015, [Claimant] sent an email to
[Employer’s] accountant stating “I’m sending this email
to confirm the conversation we had on your last visit to
the office. I had asked you what to do in a situation
where an employee of CCI works at both Lackawanna
County Prison & Susquehanna County Correctional
Facility, and their combined hours for both facilities
totals greater than 40 hours per week. Do we have to pay
overtime for the hours over 40 even though they worked
at 2 different locations which are 2 different CCI
contracts? You stated that the employee will be issued 1
single W-2 for all wages paid to them from CCI,
regardless of the location. Therefore yes, we must pay
overtime wages even though they are 2 different
locations. So to confirm—as per your instruction I am to
pay them overtime wages owed from last pay period &
any further hours worked over 40 hours per week,
regardless of location, should be paid overtime.
Yes/No????”
19. On May 18, 2015, [Employer’s] accountant
responded to [Claimant] via email and stated “I believe
this is correct but we are getting into labor laws which
should be run by attorney for his review.”
20. Later on May 18, 2015, [Claimant] sent an email to
[Employer’s] attorney stating, “We’ve had a situation
come up where 2 nurses had worked at both Lackawanna
County Prison & Susquehanna County Correctional
Facility during the same pay week. Their combined total
hours worked per week are greater than 40…Initially,
when I asked Doc he told me no overtime was required
because it is 2 separate contracts, 2 separate jobs. But
this still concerned me because even though the nurses
were working at 2 separate locations and being paid on
4
separate checks … they are still working for CCI—1
company, 1 EIN, and will receive 1 W-2 from CCI for
ALL wages paid regardless of location. As you can read
below, I ran this idea past [the accountant] and he agreed,
but is not certain. So I seek your wisdom … Legally,
where do we stand? What does Dept. of Labor have to
say about our situation? Do we pay time & half for hours
over the combined 40? Please tell me how to proceed.”
21. [Claimant] sent a copy of her May 18, 2015 email to
the accountant to the COO.
22. On May 19, 2015, [Employer’s] attorney responded
to [Claimant] via email and stated “Overtime is to be
paid.”
23. On May 19, 2015, [Claimant] sent an email to Dr.
Zaloga and copied the COO. The email stated “As per
[the attorney’s] research, it looks like the law says that
we owe… some overtime for last pay period … and
again this pay period. It’s not a big deal, I can easily
make the adjustments & include them in this payroll for
your review later. I just don’t know who to charge the
OT too? LCP or SCCF?”
24. On May 19, 2015, Dr. Zaloga responded to
[Claimant] via email and copied the COO, the attorney,
and the accountant. Dr. Zaloga stated “When you
brought this up 2 weeks ago I told you that I would speak
to [the attorney] &/or [the accountant]. No one ever told
you to start questioning them.” Dr. Zaloga reminded
[Claimant] of his December 17, 2014 directive and told
[Claimant] “Instead of worrying about issues that
concern [the COO] and [me], you need to worry about
following my directives to you. Last Friday, without
permission from anyone, you violated the HIPAA[2]
rights of a private patient of mine by faxing his test
results to the Lackawanna County Prison. Neither [the
COO] nor I directed you to do this. Apparently, you
2
The Health Insurance Portability and Accountability Act of 1996, Pub. L. 104-191, 110
Stat. 1936 (codified as amended in scattered sections of 18, 26, 29 and 42 U.S.C.).
5
chose to ignore my directive of 12-17-14. If this happens
again you will be immediately terminated for cause.”
25. The doctor specifically told [Claimant] at the end of
the May 19, 2015 email “I will discuss this issue with
[the accountant] &/or [the attorney] and decide what I
wish to do. Therefore, please proceed as I instructed you
to last pay.”
26. [Employer] was still in the process of determining
who to allocate the overtime to properly.
27. On May 20, 2015, [Claimant] did not complete
payroll for two employees who worked in excess of 40
hours. [Claimant] left payroll for the two employees in
question blank for the doctor to complete on his own.
28. On May 20, 2015, [Employer] discharged [Claimant]
for sending emails to the accountant and attorney in
regard to the payment of overtime and sending a patient’s
medical information to a wrong location, without the
permission of the COO, in violation of the doctor’s
December 17, 2014 directive.
Findings of Fact, Nos. 1-28. The Board concluded that because Employer had
already warned Claimant about the two incidents that resulted in her discharge,
Employer failed to meet its burden of proving that Claimant was discharged for
willful misconduct.
On appeal to this Court,3 Employer asserts that the Board’s Findings
of Fact Nos. 15, 16, and 28 are not supported by substantial evidence of record and
its decision is contrary to applicable law. Employer argues that the Board erred in
3
Our scope of review is limited to determining whether constitutional rights have been
violated, whether errors of law were committed, or whether findings of fact are supported by
substantial evidence. Procyson v. Unemployment Compensation Board of Review, 4 A.3d 1124,
1127 n.4 (Pa. Cmwlth. 2010).
6
accepting Claimant’s testimony and in failing to consider Employer’s assertions
that Claimant was discharged for repeated violations of Employer’s directive and
for violating HIPAA regulations.
An employer contesting a claimant’s right to benefits under Section
402(e) bears the burden of proving willful misconduct. Walsh v. Unemployment
Compensation Board of Review, 943 A.2d 363, 369 (Pa. Cmwlth. 2008). If the
employer satisfies its initial burden, the burden shifts to the claimant to
demonstrate good cause for her actions. Lausch v. Unemployment Compensation
Board of Review, 943 A.2d 363, 369 (Pa. Cmwlth. 2008). The determination of
whether a claimant’s actions amount to willful misconduct is a question of law
subject to appellate review. Noland v. Unemployment Compensation Board of
Review, 425 A.2d 1203, 1205 (Pa. Cmwlth. 1981). The issue in willful misconduct
cases is not whether the employer had the right to discharge the employee for the
particular conduct, but, rather, whether the Commonwealth is justified in
reinforcing that decision by denying benefits under the Law. See, e.g., Frumento v.
Unemployment Compensation Board of Review, 351 A.2d 631, 634 (Pa. 1976);
Pennsylvania State Police v. Unemployment Compensation Board of Review, 578
A.2d 1360, 1361 (Pa. Cmwlth. 1990).
In unemployment compensation proceedings, the Board is the
ultimate fact-finder, empowered to determine the credibility of witnesses and
resolve conflicts in evidence; the Board’s findings are conclusive on appeal where
they are supported by substantial evidence.4 Curran v. Unemployment
4
“Substantial evidence” means such relevant evidence as a reasonable mind might accept
as adequate to support a conclusion. American General Life and Accident Insurance Company v.
Unemployment Compensation Board of Review, 648 A.2d 1245, 1248 (Pa. Cmwlth. 1994).
7
Compensation Board of Review, 752 A.2d 938, 940 (Pa. Cmwlth. 2000). We must
view the record in the light most favorable to the prevailing party, giving that party
the benefit of any inferences that can reasonably be drawn from the evidence.
Sanders v. Unemployment Compensation Board of Review, 739 A.2d 616, 618 (Pa.
Cmwlth. 1999).
Employer’s argument relies on its preferred version of the facts, rather
than those found by the Board. Essentially, then, Employer’s contentions on
appeal are challenges to the Board’s exclusive authority over matters of witness
credibility and evidentiary weight. In this case, the Board resolved conflicts in
testimony in Claimant’s favor, and the testimony accepted by the Board constitutes
substantial evidence supporting the Board’s findings. Those findings, in turn,
support the Board’s conclusion that Employer failed to meet its burden of proving
that Claimant engaged in willful misconduct that would disqualify Claimant from
receiving unemployment compensation. Employer cites no authority to support its
vague assertions to the contrary.
Accordingly, we affirm.
MICHAEL H. WOJCIK, Judge
8
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Correctional Care, Inc., :
: No. 2594 C.D. 2015
Petitioner :
:
v. :
:
Unemployment Compensation :
Board of Review, :
:
Respondent :
ORDER
AND NOW, this 29th day of July, 2016, the order of the
Unemployment Compensation Board of Review, dated November 20, 2015, is
affirmed.
__________________________________
MICHAEL H. WOJCIK, Judge