J.P. Rice v. UCBR

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
James P. Rice, :
Petitioner :
:
v. : No. 659 C.D. 2020
: Submitted: June 10, 2022
Unemployment Compensation :
Board of Review, :
Respondent :
BEFORE: HONORABLE RENÉE COHN JUBELIRER, President Judge
HONORABLE CHRISTINE FIZZANO CANNON, Judge
HONORABLE MARY HANNAH LEAVITT, Senior Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY SENIOR JUDGE LEAVITT FILED: September 15, 2022
James P. Rice (Claimant) petitions for review of an adjudication of the
Unemployment Compensation (UC) Board of Review (Board). The Board held that
Claimant was ineligible for unemployment compensation benefits under Section
402(e) of the Unemployment Compensation Law (Law)1 by reason of willful
misconduct. Concluding that the employer did not prove a violation of its work rule,
we reverse the Board.
Background
Claimant began working full time for Mars Home for Youth
(Employer) as an electronic monitoring specialist in 2004. He was discharged on
December 6, 2019, for violating Employer’s confidentiality policy. Claimant
1
Act of December 5, 1936, Second Ex. Sess., P.L. (1937) 2897, as amended, 43 P.S. §§751-
919.10. Section 402(e) of the Law provides that an employee shall be ineligible for compensation
for any week in which his unemployment is due to his discharge or temporary suspension from
work for willful misconduct connected with his work. 43 P.S. §802(e).
applied for unemployment compensation benefits, which the Indiana UC Service
Center denied pursuant to Section 402(e) of the Law. Claimant appealed, and a
hearing was conducted by a Referee.
At the hearing, Employer presented the testimony of Elizabeth Hays,
its director of human resources. She explained that Employer, inter alia, monitors
juveniles who have been placed on probation by the county juvenile court system.
Employer’s confidentiality policy states, in relevant part, as follows.
[Employer’s] clients and other parties with whom we do business
entrust [Employer] with privileged information related to their
needs and business. It is our policy that all such information is
considered confidential and will not be disclosed to external
parties or to employees without a “need to know.”
Certified Record at 139 (C.R.____); Item 13, Employer Exhibit 1, at 2 (emphasis
added). A violation of this confidentiality policy is a “terminable offense,”
according to Hays. Notes of Testimony, 2/21/2020, at 8 (N.T.___); C.R. 112. On
cross-examination, Hays testified that a probation officer would be a good example
of a third party who needs to know a client’s confidential information. N.T. 10; C.R.
114. For other parties, “[i]t would depend on the urgency of the situation.” Id.
Claimant was discharged for sharing the age of a client with the principal of a school
that employed the client as a classroom helper.
Employer also presented the testimony of Lukas Carothers, Claimant’s
supervisor. Carothers testified that Claimant admitted that he shared a client’s age
with the principal of a school. Carothers explained that if an employee needs to
disclose a client’s confidential information out of a safety concern, the employee
should contact “the probation officer of that youth” or the “home provider” or secure
“an appropriate consent and release of information.” N.T. 14; C.R. 118. On cross-
examination, Carothers clarified that in an “imminent situation,” where “the youth
2
or somebody was going to commit some type of crime or . . . cause harm,” the
employee should report the information to law enforcement or, “hypothetically,” a
school principal, where there is a threat to the school. N.T. 17; C.R. 121.
Claimant presented the testimony of Stephen Dobransky, the school
principal. Dobransky knew Claimant as a parent of a student attending the school.
Dobransky testified that on November 18, 2019, at approximately 7:15 a.m.,
Claimant came to his office and asked, “what was the age that someone could be to
work for the district?” N.T. 23; C.R. 127. Dobransky replied that it was 18. Id.
Claimant said, “what if I told you somebody here was not 18?” Id. Dobransky
testified that based upon this information, he was able to identify the particular
juvenile because he was a new employee. Dobransky confronted the juvenile about
his age and discharged him because it is “not appropriate or acceptable” for someone
under the age of 18 to work in a classroom with minor children. N.T. 24; C.R. 128.
Claimant also testified about the incident for which he was discharged.
The relevant testimony follows:
[Counsel:] . . . . You are not denying that you advised the school
district that there was a 17-year-old that was working there?
[Claimant:] That’s correct. That was his first day. And, since he
informed me over the weekend that he would be needing a
window to work that Monday morning, when I dropped my son
off, since I was there, I went in to find out if he was eligible to
work there. It didn’t sound right that a minor’s allowed to work
in a school district. So, when I walked in, the principal was
standing outside the office. I asked him what the requirements
were for a paraprofessional.
[Counsel:] You did not turn over this young man’s name, correct?
[Claimant:] I did not.
[Counsel:] If the answer to the question was, it was acceptable
for a 17-year-old to be working as a paraprofessional, that
would’ve been the end of it for you, correct?
3
[Claimant]: Correct. That is enough.
***
[Counsel:] . . . . What was the concern that you had about finding
out that this young man was there at the school?
[Claimant:] My concern was that – his age. I can’t imagine that
you could be a minor working with juveniles in a school district.
And since I was already there, I went in.
***
[Counsel:] Did you feel that the school had a need to know that
there was an issue?
[Claimant:] I believe so. I mean, if you were a parent and you
had a 13-year-old kid in that school, would you want a minor in
their classroom?
N.T. 26-28; C.R. 130-32. Claimant testified that Employer had given him
“discretion to deal with issues that arise” and to take “immediate action” in situations
involving a safety concern. N.T. 28; C.R. 132.
The Referee affirmed the UC Service Center’s denial of unemployment
compensation. The Referee found that Employer’s confidentiality policy prohibited
Claimant from sharing the juvenile’s age information with the school principal.
Claimant did not advise the appropriate probation officer that the juvenile was about
to start a job for which he was not qualified. Rather, Claimant revealed the juvenile’s
age to the school principal because he was concerned for the welfare of Claimant’s
child. The school principal then identified and discharged the juvenile on the basis
of the information Claimant provided. On these factual findings, the Referee
concluded that Employer met its burden of proving that Claimant was discharged
for violating Employer’s confidentiality policy, which constituted willful
misconduct. The burden then shifted to Claimant to show good cause for his
conduct. However, the Referee concluded that Claimant did not carry this burden.
4
There were no exigent circumstances that prevented Claimant from contacting the
juvenile’s probation officer and allowing the officer to handle the matter.
On appeal, the Board added a finding that Claimant “was aware or
should have been aware of [Employer’s] policies,” and it removed a finding made
by the Referee that Claimant “was aware that the school required employees to be at
least 18 years of age” for the stated reason that this finding is “not explicitly precise
and is irrelevant.” Board Adjudication, 5/20/2020. The Board adopted the
remainder of the Referee’s findings of fact and conclusions of law and affirmed the
Referee’s decision. The Board rejected Claimant’s argument that there was an
urgency to the school principal’s need to know that the client was not 18 years old.
The Board opined that urgency involves “a direct threat or future crime, neither of
which apply here.” Id.
Claimant petitioned for this Court’s review.2
Appeal
On appeal, Claimant raises one issue for our consideration.3 Claimant
argues that the Board erred in holding that he violated Employer’s confidentiality
2
Our review determines whether constitutional rights were violated, whether an error of law was
committed, or whether necessary findings of fact are supported by substantial competent evidence.
Seton Company v. Unemployment Compensation Board of Review, 663 A.2d 296, 298 n.2 (Pa.
Cmwlth. 1995).
3
Claimant’s statement of questions involved lists one question: “Whether [Claimant’s]
unemployment was due to discharge or temporary suspension from work for willful misconduct
connected with his employment.” Claimant Brief at 4. The arguments contained in Claimant’s
brief, however, raise a separate issue: whether Claimant’s actions in violating Employer’s
confidentiality policy are protected by the Whistleblower Law, Act of December 12, 1986, P.L.
1559, as amended, 43 P.S. §§1421-1428. Pursuant to PA. R.A.P. 2116, the statement of questions
involved “must state concisely the issues to be resolved,” and “[n]o question will be considered
unless it is stated in the statement of questions involved or fairly suggested thereby.” For this
reason, we will not address Claimant’s issue raised under the Whistleblower Law. Additionally,
it is unnecessary for the Court to consider Claimant’s Whistleblower Law issue in light of our
disposition of Claimant’s other issue on appeal.
5
policy. Claimant asserts that he did not disclose confidential information but, rather,
“the hypothetical existence of a minor[-]aged employee,” and the school principal
“took it upon himself to investigate the matter and discovered the juvenile employee
through his own efforts.” Claimant Brief at 9, 11. Employer’s confidentiality policy
provides that a client’s confidential information cannot be disclosed to anyone
without a “need to know,” but it does not define what that means with any specificity.
Claimant asserts that the principal “needed to know” the juvenile’s age information
to ensure the well-being of the students in the building. As Dobransky testified, it is
not appropriate or acceptable to have a minor employed to work in a classroom with
other minor-aged children.
In the alternative, Claimant argues that he violated the confidentiality
policy for good cause because he, as a mandatory reporter under the Child Protective
Services Law,4 was under an affirmative duty to report anything that threatens the
safety of minor students in the school district. This includes the presence of a
juvenile in the classroom working as a paraprofessional with minor children.
Employer responds that Claimant’s so-called “hypothetical questions”
about the school’s minimum age requirement enabled the school principal to identify
the juvenile. Employer Brief at 12. Claimant’s status as a mandatory reporter under
the Child Protective Services Law is irrelevant because the incident for which he
was discharged did not involve suspected child abuse. Employer further asserts that
the school principal did not need to know the juvenile’s age “right then, that minute,”
because there was no immediate danger. Employer Brief at 14. The juvenile was
there to support a classroom teacher, and he did not present an immediate risk or
4
Section 6303 of the Child Protective Services Law defines a “mandatory reporter” as “[a] person
who is required by this chapter to make a report of suspected child abuse.” 23 Pa. C.S. §6303.
6
make any threats. Employer contends that Claimant had ample opportunity to take
“appropriate notification actions,” such as contacting the juvenile’s probation
officer, but he chose not to do so. Employer Brief at 15.
In unemployment cases, the initial burden of proving willful
misconduct lies with the employer. Oyetayo v. Unemployment Compensation Board
of Review, 110 A.3d 1117, 1121 (Pa. Cmwlth. 2015). Although not defined in the
Law, willful misconduct has been interpreted to include:
(i) wanton and willful disregard of the employer’s interests; (ii)
a deliberate violation of the employer’s rules; (iii) a disregard of
the standards of behavior that the employer rightfully can expect
from its employees; and (iv) negligence that manifests
culpability, wrongful intent or evil design, or an intentional and
substantial disregard of the employer’s interests or the
employee’s duties and obligations.
Id. Where an employer seeks to deny unemployment compensation benefits based
on a work rule violation, the employer must show that the rule existed; that the rule
was reasonable; and that the claimant was aware of and violated the rule. Id. “If the
employer makes that showing, the burden shifts to the claimant to show good cause
for his conduct.” Id.The Board is the ultimate finder of fact and is empowered to make
credibility determinations. “When the Board’s findings of fact are supported by
substantial evidence, that is such evidence a reasonable mind might accept as
adequate to support a conclusion, those findings are conclusive on appeal.” Id. at
1122. However, whether an employee’s actions constitute willful misconduct is a
question of law fully reviewable by this Court. Id.We begin with a review of the confidentiality policy that Claimant was
found to have violated. It states as follows:
7
[Employer’s] clients and other parties with whom we do business
entrust [Employer] with privileged information related to their
needs and business. It is our policy that all such information is
considered confidential and will not be disclosed to external
parties or to employees without a “need to know.”
Similarly, employees may at times become aware of information
related to others’ work situations or personal matters. Such
information also is not to be disclosed without a “need to know.”
If there is a question of whether certain information is considered
confidential, the employee should first check with his/her
immediate supervisor.
This policy is intended to alert employees to the need for
discretion at all times and is not intended to inhibit normal
business communications.
C.R. 139; Item 13, Employer Exhibit 1, at 2 (emphasis added).
The confidentiality policy prohibits disclosure of a client’s confidential
information to third parties lacking a “need to know,” but it does not specify who
has the “need to know” or what constitutes “need.” Hays, Employer’s director of
human resources, opined that a probation officer is a person with a “need to know;”
for others, it depends “on the urgency of the situation.” N.T. 10; C.R. 114. The
Board adopted Employer’s interpretation of its policy that there must be an urgent
reason to justify disclosure of the juvenile’s information to a third party. However,
the confidentiality policy does not state that the need must be an urgent need.
In Adams v. Unemployment Compensation Board of Review, 56 A.3d
76 (Pa. Cmwlth. 2012), the claimant sought review of the Board’s adjudication
denying him unemployment compensation benefits for willful misconduct. The
employer had a work rule requiring that employees “must notify [their] employer of
any arrest or conviction while employed.” Id. at 78. The claimant was directed to
appear before a magistrate; however, he was not handcuffed or taken into custody.
The employer learned of the incident through a third party and discharged the
8
claimant for violating the work rule. On appeal, the claimant argued that he was not
“arrested” when compelled to report to a magistrate and, therefore, was under no
obligation to notify the employer of the criminal charges. We agreed that the
claimant had not been “arrested.” The claimant’s liberty was not affected, as the
term “arrest” is commonly understood. Id. at 79. Nor did the employer’s work rule
define “arrest” to include a filing of charges. Because the employer’s work rule
specified “any arrests or convictions,” not charges, we held that the Board erred in
the interpretation of the work rule. Id. at 80.
Patnesky v. Unemployment Compensation Board of Review, 200 A.3d
107 (Pa. Cmwlth. 2018), concerned the denial of unemployment compensation
benefits for violating the employer’s confidentiality policy. There, the claimant
worked for the Pennsylvania Department of Transportation (PennDOT) as a driver’s
license examiner assistant. Under PennDOT’s confidentiality policy, employees
were forbidden to use PennDOT’s information for personal reasons or to assist their
family or friends. However, the policy expressly authorized employees to assist their
co-worker’s family and friends “directly” so long as the assistance was an assigned
job responsibility. Patnesky, 200 A.3d at 112-13. The claimant produced a
replacement identification card for the incapacitated child of her co-worker, who had
power of attorney to act on the child’s behalf. The Board found a violation of the
policy because the employee indirectly assisted a co-worker. This Court reversed.
We held that the claimant did not violate the confidentiality policy
because the issuance of a replacement identification card was the claimant’s job
responsibility. Id. at 113. PennDOT’s policy was silent on the processing of
applications presented by a co-worker acting under a guardianship order. It did not
require the incapacitated child be present when the guardian requested an
9
identification card on his behalf. Id. at 113-14. We concluded that PennDOT failed
to prove that the claimant violated a work rule, and, as such, the burden did not shift
to the claimant to show good cause for her conduct.
Here, Employer’s confidentiality policy states that client information
“will not be disclosed to external parties or to employees without a ‘need to know.’”
C.R. 139; Item 13, Employer Exhibit 1, at 2 (emphasis added). The policy is silent
on who has the “need to know” a client’s confidential information and the
circumstances under which the information can be revealed. The Board found that
Claimant violated the policy because there was no imminent risk of harm to justify
Claimant’s disclosure of the juvenile’s age. The juvenile was working in a
classroom, as opposed to making a threat. However, the policy does not state that
disclosure of confidential information can only be made where there is a threat of
harm. Nor does it matter that Claimant disclosed the juvenile’s age because he was
concerned for the welfare of Claimant’s own child. The policy simply prohibits
disclosure of confidential information to “external parties or to employees without a
‘need to know.’” Id. (emphasis added).
Claimant testified that he believed the principal needed to know that
there was a juvenile working with minor students in the school’s classrooms.
Employer acknowledges that it was impermissible for a juvenile to work in the
school classroom and that Claimant should have taken action “upon his learning that
the [juvenile] might be working in [the] school.” Employer Brief at 15. Employer
disagrees with Claimant’s chosen course of action. Instead of speaking with the
school principal, Employer argues Claimant should have referred the matter to the
juvenile’s probation officer, the home provider, or Claimant’s supervisor. Id.
10
We reject this argument. The confidentiality policy did not state that
an employee must contact the probation officer or the home provider before
disclosing confidential information to a third party with a “need to know.” Claimant
was not required to consult with his supervisor unless he has “a question of whether
certain information is considered confidential.” C.R. 139; Item 13, Employer
Exhibit 1, at 2. Indeed, Employer’s confidentiality policy gave employees the
discretion to disclose confidential information where appropriate to those with a
“need to know.” The policy states that it is not intended to “inhibit normal business
communications.” Id.
Where an employer discharges an employee for a work rule violation,
the employer has the burden of proving the rule’s existence, its reasonableness, and
its violation. Oyetayo, 110 A.3d at 1121. The employer must also show that the
claimant’s violation of the work rule was intentional and deliberate. Cambria
County Transit Authority (“CamTran”) v. Unemployment Compensation Board of
Review, 201 A.3d 941, 950 (Pa. Cmwlth. 2019) (citing Grieb v. Unemployment
Compensation Board of Review, 827 A.2d 422, 425-26 (Pa. 2003)). Here, Claimant
shared the juvenile’s age information with the school principal, a person he believed
to have a “need to know.” C.R. 139; Item 13, Employer Exhibit 1, at 2. Employer’s
confidentiality policy gave Claimant the discretion to make a disclosure in these
circumstances. It did not require a risk of harm, and it did not direct employees to
report to the juvenile’s probation officer, or home provider, or their supervisor before
making a disclosure to a third party believed to have a need to know. Accordingly,
Employer did not prove that Claimant acted in deliberate and willful violation of
Employer’s confidentiality policy.
11
Conclusion
For the foregoing reasons, we hold that the Board erred in determining
that Claimant engaged in disqualifying willful misconduct under Section 402(e) of
the Law. We thus reverse the Board’s May 20, 2020, adjudication and remand the
matter for further proceedings for a calculation of the unemployment benefits owed
to Claimant.
____________________________________________
MARY HANNAH LEAVITT, President Judge Emerita
Judge Wallace did not participate in the decision in this case.
12
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
James P. Rice, :
Petitioner :
:
v. : No. 659 C.D. 2020
:
Unemployment Compensation :
Board of Review, :
Respondent :
ORDER
AND NOW, this 15th day of September, 2022, the May 20, 2020, order
of the Unemployment Compensation Board of Review, in the above-captioned
matter, is REVERSED. This matter is REMANDED for further proceedings in
accordance with the attached opinion.
Jurisdiction relinquished.
____________________________________________
MARY HANNAH LEAVITT, President Judge Emerita