Justin M. Robinson, App/cross-res. v. Employment Security Dept, Res/cross-app.

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
JUSTIN M. ROBINSON, )
) No. 73619-1-1
Appellant/ )
Cross-Respondent,) DIVISION ONE
)
)
)
EMPLOYMENT SECURITY )
DEPARTMENT OF THE STATE OF ) UNPUBLISHED OPINION
WASHINGTON, )
) FILED: July 17, 2017
Respondent/ )
Cross-Appellant. )
)
BECKER, J. — Before us on discretionary review is a superior court order
remanding for the taking of additional evidence in an administrative proceeding
that upheld the denial of unemployment benefits. The case does not meet the
criteria for reopening the record, but it does require a remand for a new set of
findings and conclusions. The key evidence the agency relied on to deny
benefits was unreliable hearsay, and it is unclear which party had the burden of
proof with respect to the employee's claim that he gave notice instead of
resigning effective immediately. We order the case remanded for
reconsideration by the agency on the existing record.
No. 73619-1-1/2
FACTS
The following facts are undisputed. Appellant Justin Robinson was
employed by Target beginning June 19, 2012. In May 2014, he decided to quit
his position because of a personal conflict with his supervisor, John Randall. On
May 17, Randall sent Robinson a text message advising him to follow Target's
resignation notice policy rather than ending his employment on bad terms. Also
on May 17, Robinson sent a text message to another supervisor, Julia Robison,
saying that he intended to give two weeks' notice of his resignation. On May 18,
Robinson telephoned Emily Hughes, a Target human resources manager, to tell
her he was quitting.
Exactly what Robinson told Hughes in that phone call is the critical fact in
dispute. According to Robinson, he told Hughes he was giving two weeks'
notice. According to Target, he told her he was resigning effective immediately.
It is undisputed that Target immediately removed Robinson's name from
the work schedule after that phone call and stopped paying him.
Robinson applied for unemployment compensation. The Employment
Security Department denied Robinson's application on July 10, 2014, on the
ground that he quit voluntarily without good cause.
Robinson appealed the decision to the Office of Administrative Hearings
for the department. A hearing was held before an administrative law judge.
Robinson testified at the hearing that when he spoke with Hughes on the
telephone, he told her he was putting in his two weeks' notice and that his last
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No. 73619-1-1/3
day would be May 31. He said that when he next went to work as scheduled, he
was not able to "punch in," and was told that he was not on the work schedule.
Target's representative at the hearing was Annie Kroshus, who had
replaced Hughes as a human resources manager. Hughes was not present.
Kroshus testified that Robinson told Hughes he was "voluntarily resigning" and
that his decision to end his employment was "effective immediately. And so that
is why he was removed."
If Robinson resigned effective immediately as Kroshus testified, it was a
voluntary quit without good cause and he is not entitled to benefits. RCW
50.20.050. But if Robinson gave two weeks' notice and Target accelerated the
date of the job separation without paying him through the notice period, it was an
involuntary discharge and he is entitled to benefits under RCW 50.20.060.
Safeco Ins. Cos. v. Meverinq, 102 Wn.2d 385, 687 P.2d 195(1984); In re Moa,
Empl. Comm'r Dec. 1132(1974); In re Sauer, Empl. Sec. Comm'r Dec.2d 334
(1977); In re Satcher, Empl. Sec. Comm'r Dec.2d 741 (1983).1
The judge asked Kroshus what information she was looking at, "as far as
that his resignation was effective immediately?" Kroshus said she was testifying
based on her review of e-mails:
MS. KROSHUS: Um,so 1 just have—unfortunately, I only
have a series of emails, uh,from Emily that she sent, urn, to the—
to the office.
[JUDGE]: Okay. So if-1 guess, from your experience in
H.R., if any employee gives, urn, notice to quit, is it always effective
immediately or is an end date discussed?
1 Opinions designated by the commissioner as precedential are
persuasive authority in this court. RCW 50.32.095; Martini v. State Emp't Sec.
Dep't, 98 Wn. App. 791, 795, 990 P.2d 981 (2000).
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No. 73619-1-1/4
MS. KROSHUS: Yeah. So it is typically circumstantial. Uh,
it sounds, based on all of the written correspondence that I have,
urn, it—it was effective immediately just over the phone. It's typical
that we have someone still out.[2] A voluntary resignation form in
which they write down when their last date will be, but that was not
the case here. In the system—in our hiring system—Justin was
keyed as, uh, a rehirable—personal rehire—personal rehirable,
which means that he decided to leave for personal reasons. And it
does mean that we would rehire him if he decided to come back to
Target at a later date. Um, and that is just for our own records
based on people wanting to return in the future.
[JUDGE]: So if Mr. Robinson had stated his last date—he
wanted his last date to be the 31st of May, I guess, would H.R.
override that and make it effective immediately?
MS. KROSHUS: No, we would-1 mean, if—if the date was
specified, and because, you know, for all intents and purposes it
sounds like, um—and maybe John can speak more to this, but it
sounds like Emily was really trying to work with Justin to extend a
leave of absence they needed. But, um, if he had specified that
date as his last date, that is what we would have keyed as the date.
So unfortunately, 1 have no other information regarding what that
date discussed was.
Hughes had sent the e-mails to Kim Sharner,"the unemployment hearing
consultant," and to Lori Horn,"the unemployment insurance consultant for
Workforce Solutions." Sharner and Horn were not present. The e-mail
messages were not submitted as evidence.
A second witness for Target was John Randall, the supervisor with whom
Robinson had a conflict. Randall, responding to questions from the judge,
testified that on May 19, he was in the building on the second floor and Robinson
could have contacted him but did not do so.
The judge asked Robinson how he thought Hughes got the impression
that he was resigning effective immediately. Robinson answered that Hughes
2 According to Robinson, there is an error in the transcript and it should
read, "fill out" instead of "still out."
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No. 73619-1-1/5
asked him if he wanted to take another leave of absence and he told her, "``I just
cannot continue to work with John." But Robinson said he thought Hughes
understood he was planning to work through the next two weeks. "I told her it
was a two weeks-1'm putting in my two weeks. There was no effective
immediately." He said he and Hughes used their calendars to count out two
weeks and agreed that his last day of work would be May 31, and Hughes told
him at the time she was typing that information into the corporate system.
The judge asked Robinson why he did not make a greater effort to contact
someone at Target on May 19 to find out why he had been taken off the
schedule. Robinson said he called Hughes and she told him she would look into
it, but he never received a call back.
The administrative law judge issued an initial order determining that it was
a voluntary quit. Her determination that Robinson notified Target that he was
quitting effective immediately is set forth in two findings and a conclusion of law:
Finding of fact 9:
Claimant stated [in a telephone conversation with Emily Hughes on
May 18, 2014]that he could no longer work with his supervisor.
Human Resources accepted claimant's resignation effective
immediately.
Finding of fact 10:
Claimant was scheduled to work on May 19, 2014. Because
claimant had resigned claimant was taken off the schedule.
Conclusion of law 5:
In this case the claimant alleges that employer accelerated the job
separation when he intended to work two weeks after his notice.
The undersigned concludes the claimant's testimony was not
credible and finds that claimant notified the employer that his
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No. 73619-1-1/6
resignation was effective immediately, on May ... 18, 2014.[31
Claimant voluntarily resigned from his position and this case is
properly adjudicated as a quit under RCW 50.20.050.
Findings of fact 9 and 10 are not clear as to whether Robinson said his
resignation was effective immediately, or whether Target decided to treat the
resignation as effective immediately. Conclusion of law 5 contains the only
statement on the disputed issue, where the judge "finds that claimant notified the
employer that his resignation was effective immediately." We will review this
statement as a finding rather than as a legal conclusion.
Robinson obtained review by the Commissioner of the Employment
Security Department. The decision of the commissioner, issued by a review
judge in the commissioner's review office, affirmed the decision of the
administrative law judge. The findings of fact and conclusions of law were
adopted with minor changes.
Robinson petitioned for review in superior court. The superior court was
"unable to determine" whether the agency decision was supported by substantial
evidence:
The Court is unable to determine whether the
Commissioner's findings of facts are supported by substantial
evidence due to its dependence on unreliable hearsay evidence
specifically the testimony of a human resources employee
characterizing emails written by a different employee (no longer
with Target). These emails were not part of the administrative
record, were not written contemporaneously to the events at issue,
and did not constitute business records.
3 The administrative law judge finding was "May 17 or 18," but the
commissioner modified it to "May 18" based on the record.
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No. 73619-1-1/7
The court ordered a remand of the commissioner's decision back to the Office of
Administrative Hearings for additional fact-finding on the issue of whether
Robinson resigned giving two weeks' notice or resigned effective immediately
when talking with Emily Hughes. The order stated, "Both parties should have the
opportunity to submit additional evidence."
The superior court's remand order is before this court on Robinson's
motion for discretionary review.
1. The superior court abused its discretion by reopening the record for additional
fact-finding
Robinson correctly contends the court lacked statutory authority to reopen
the record for the taking of additional evidence.
"Judicial review of a decision of the commissioner involving the review of
an appeals tribunal decision may be had only in accordance with the procedural
requirements of RCW 34.05.570," the Administrative Procedure Act. RCW
50.32.120.
Generally, judicial review of an agency action is confined to the agency
record. RCW 34.05.558. Remand of a matter for additional fact-finding is
allowed in certain circumstances by RCW 34.05.562(2):
The court may remand a matter to the agency, before final
disposition of a petition for review, with directions that the agency
conduct fact-finding and other proceedings the court considers
necessary and that the agency take such further action on the basis
thereof as the court directs, if:
(a) The agency was required by this chapter or any other
provision of law to base its action exclusively on a record of a type
reasonably suitable for judicial review, but the agency failed to
prepare or preserve an adequate record;
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No. 73619-1-1/8
(b) The court finds that (i) new evidence has become -
available that relates to the validity of the agency action at the
time it was taken, that one or more of the parties did not know and
was under no duty to discover or could not have reasonably been
discovered until after the agency action, and (ii) the interests of
justice would be served by remand to the agency;
(c) The agency improperly excluded or omitted evidence
from the record; or
(d) A relevant provision of law changed after the agency
action and the court determines that the new provision may control
the outcome.
A superior court's decision to expand the record under RCW 34.05.562 is
reviewed by this court for abuse of discretion. Amalgamated Transit Union, Local
1384 v. Kitsap Transit, 187 Wn. App. 113, 122-23, 349 P.3d 1, review
denied, 184 Wn.2d 1005(2015).
The superior court did not identify the source of its authority to order
additional fact-finding. The department contends the court was presented with a
situation where "the agency failed to prepare or preserve an adequate record,"
RCW 34.05.562(2)(a). This is incorrect. The problem identified by the superior
court was the unreliability of the evidence presented by Target, not a failure by
the agency to prepare or preserve a record suitable for judicial review. Target
decided to present its case without calling Emily Hughes as a witness and
without submitting her e-mails into the record. Target's failure to present reliable
evidence is not attributable to the department.
The department alternatively contends a court may remand for further
fact-finding when there is insufficient evidence to support the agency decision.
For this proposition, the department relies on Hong v. Department of Social &
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No. 73619-1-1/9
Health Services, 146 Wn. App. 698, 192 P.3d 21 (2008), review denied, 165
Wn.2d 1052(2009).
In Hong, after a key witness completed her testimony supporting the
agency's position, a document came to light that cast doubt on the credibility of
the witness. The administrative law judge for the agency denied a motion to
reopen the case to allow further cross-examination of the witness concerning the
document. Hong, 146 Wn. App. at 705. The superior court remanded for further
proceedings to address the witness's credibility. Hong, 146 Wn. App. at 705.
This court held that the superior court's remand order was authorized by RCW
34.05.562(2)(c), which allows remand if the agency "improperly excluded or
omitted evidence from the record." RCW 34.05.562(2)(c). Hong does not hold
that a party may be given a second opportunity to submit evidence when the
evidence presented at the administrative hearing is insufficient to support that
party's position on appeal.
We conclude the superior court abused its discretion by remanding for the
taking of additional evidence. The matter must be decided on the existing
agency record.
2. The existing record does not support the finding that Robinson resigned
effective immediately
On cross review, the department requests affirmance of the
commissioner's decision. The department contends that even without the
testimony about the Hughes e-mails, the existing agency record contains
substantial evidence to prove that Robinson resigned effective immediately.
No. 73619-1-1/10
In reviewing an agency decision, we sit in the same position as the
superior court and apply the standards of the Administrative Procedure Act
directly to the administrative record. Campbell v. State Emp't Sec. Dep't, 180
Wn.2d 566, 571, 326 P.3d 713(2014). Thus, the decision we review is that of
the agency. Campbell, 180 Wn.2d at 571.
The decision of the commissioner on matters relating to the Employment
Security Act is prima facie correct, and the burden is on the challenger to show
otherwise. RCW 50.32.150. Under the Administrative Procedure Act, Robinson
has "the burden of demonstrating the invalidity of agency action." RCW
34.05.570(1)(a). We may grant relief to Robinson only if he has been
"substantially prejudiced by the action complained of." RCW 34.05.570(1)(d).
The standards for granting relief from an agency order in an adjudicative
proceeding are stated in RCW 34.05.570(3). Robinson's primary argument for
relief is that the order "is not supported by evidence that is substantial when
viewed in light of the whole record before the court." RCW 34.05.570(3)(e).
Substantial evidence is evidence of a sufficient quantity to persuade a fair-
minded person of the truth and correctness of the agency action. Campbell, 180
Wn.2d at 571.
Hearsay evidence is admissible in administrative proceedings "if in the
judgment of the presiding officer it is the kind of evidence on which reasonably
prudent persons are accustomed to rely in the conduct of their affairs." RCW
35.05.452(1). Findings of fact may be based on such evidence even if it would
be inadmissible in a civil trial. "However, the presiding officer shall not base a
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No. 73619-1-1/11
finding exclusively on such inadmissible evidence unless the presiding officer
determines that doing so would not unduly abridge the parties' opportunities to
confront witnesses and rebut evidence. The basis for this determination shall
appear in the order." RCW 35.05.461(4). Robinson contends that the
commissioner's finding in conclusion of law 5 is invalid because it is based solely
on the inadmissible hearsay evidence provided by Kroshus.
The department prudently declines to defend the admission of the
Kroshus testimony summarizing the contents of the Hughes e-mails. As the
superior court recognized, this was unreliable hearsay evidence. Instead, the
department maintains that the disputed finding is supported by substantial
circumstantial nonhearsay evidence:(1) Kroshus testified that it was the
employer's practice to key the separation date requested by the employee
directly into the work schedule, and the date keyed in for Robinson was May 18;
(2)She testified that Target typically has an employee fill out a voluntary
resignation form specifying their last date of employment, and Robinson did not
fill out this form;(3)She testified that Robinson was considered eligible for rehire;
and (4) Robinson testified that he tried to clock in for work on May 19, but he was
unable to explain why, if he was surprised by being turned away, he did not get in
touch with John Randall, who was in the building at the time.
Strictly speaking, RCW 35.05.461(4) does not apply because the
presiding officer based her finding at least in part on the circumstantial evidence
itemized above. But we arrive at the same outcome. The circumstantial
evidence, when viewed in light of the whole record, is not enough to persuade a
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No. 73619-1-1/12
fair-minded person that Robinson told Hughes he was resigning effective
immediately.
The employer's alleged practice of keying in the employee's requested
separation date is not decisive. Kroshus said, "But, um, if he had specified that
date[May 31]as his last date, that is what we would have keyed as the date. So
unfortunately, 1 have no other information regarding what that date discussed
was." This is not evidence that Robinson said he was resigning effective
immediately. Also, it is not evidence that it was Hughes who keyed in May 18 as
Robinson's last day of work. And Hughes was not available for questioning
about this topic.
The other items of nonhearsay evidence have even less persuasive value.
There was no testimony that Robinson knew he was supposed to fill out a
voluntary resignation form to establish that he was giving two weeks' notice. The
fact that Robinson was keyed in as eligible for rehire suggests just as readily that
he tried to leave on good terms as that he quit without giving notice. Randall's
testimony that he was working on the second floor and did not see or talk to
Robinson is not irreconcilable with Robinson's testimony that he was told Randall
was not present when he tried to clock in. When the unreliable hearsay evidence
provided by Kroshus is set aside, the record does not support the finding that
Robinson resigned effective immediately. The only admissible evidence is that
Robinson gave two weeks' notice. Accordingly, we reject the department's
request to affirm the commissioner's decision. Robinson has demonstrated that
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No. 73619-1-1/13
the commissioner's decision is not correct and that he was prejudiced by the
commissioner's use of unreliable hearsay.
3. The matter must be remanded to the department for a new set of findings and
conclusions
The next question is what relief Robinson is entitled to as a result of the
agency's unsupported finding that he resigned effective immediately. Robinson
contends he is entitled to an award of unemployment benefits and attorney fees.
While the department has failed to prove that Robinson resigned effective
immediately, it is also not an established fact that Robinson gave two weeks'
notice. This is because the administrative law judge found Robinson was not a
credible witness:
The testimony of the parties conflicted on material points regarding
the job separation. The undersigned, having carefully considered
and weighed all the evidence, including the witness demeanor(as
determined by voice, attitude, straightforwardness, unreasonable
hesitancy in responses), party motivations, the reasonableness and
consistency of the testimony throughout the hearing and as related
to prior document submissions in connection with the benefits claim
and claim response, whether the testimony was of first-hand
knowledge or hearsay, and the totality of the circumstances
presented, finds that the testimony of employer is more credible.
The testimony of employer's witnesses was logical and consistent.
It does not make logical sense that employer would have
accelerated the job separation, but still considered claimant to be
eligible for re-hire. No does it make logical sense that claimant
would have been able to correspond with supervisors and human
resources over the phone and through text message on May 17-18,
2014, yet after May 19, 2014 claimant was not able to speak or
correspond with a supervisor or human resources. Claimant
testified that he arrived at work on May 19, 2014 and was not able
to clock in. Claimant testified that he spoke with a supervisor, but
does not remember to whom he spoke. Claimant's supervisor
testified at hearing and was present in the store during the time
which claimant states he tried to clock in on May 19, 2014. The
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No. 73619-1-1/14
supervisor did not see claimant or have any knowledge of claimant
ever coming in to the store that day.
Finding of Fact 4.
In this case the claimant alleges that employer accelerated the job
separation when he intended to work two weeks after his notice.
The undersigned concludes the claimant's testimony was not
credible and finds that claimant notified the employer that his
resignation was effective immediately.
Conclusion of Law 5. The commissioner's review judge independently made the
same determination. "Additionally, our thorough review of the record convinces
us the claimant is not a credible witness."
In assessing the credibility of a witness, this court may not substitute its
judgment for that of the agency tribunal. See e.g., Scheeler v. Dep't of Emp't
Sec., 122 Wn. App. 484, 490-91, 93 P.3d 965 (2004). This is particularly true
when the credibility assessment is based on witness demeanor. Here, the
agency based its assessment of Robinson's credibility in part on demeanor and
in part on a judgment that the testimony of Kroshus and Randall was more logical
and consistent than Robinson's testimony. As discussed above, the testimony of
Kroshus had no value, and Randall likewise had no personal knowledge of what
was said in the May 18 phone call between Robinson and Hughes. For that
reason, the agency's credibility assessment may not stand as is. Nevertheless,
because the commissioner did not believe Robinson when he said he told
Hughes he was giving two weeks' notice, we may not conclude as a matter of
law that Robinson did give two weeks' notice. Thus, we are not in a position to
require the commissioner to adjudicate Robinson's job separation as a discharge
rather than as a voluntary quit.
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No. 73619-1-1/15
The Administrative Procedure Act provides guidance in this situation. It
allows, among other options, a remand for further proceedings.
(1) In a review under RCW 34.05.570, the court may(a)
affirm the agency action or (b) order an agency to take action
required by law, order an agency to exercise discretion required by
law, set aside agency action, enjoin or stay the agency action,
remand the matter for further proceedings, or enter a declaratory
judgment order. The court shall set out in its findings and
conclusions, as appropriate, each violation or error by the agency
under the standards for review set out in this chapter on which the
court bases its decision and order. In reviewing matters within
agency discretion, the court shall limit its function to assuring that
the agency has exercised its discretion in accordance with law, and
shall not itself undertake to exercise the discretion that the
legislature has placed in the agency. The court shall remand to the
agency for modification of agency action, unless remand is
impracticable or would cause unnecessary delay.
RCW 34.05.574.4
We believe the appropriate disposition of these cross motions for
discretionary review is to remand the matter for the agency to take a second
look. The agency should reexamine the existing record and generate a new set
of findings and conclusions in light of this opinion. Questions to be considered
on remand include the following:
Burden of proof. The Employment Security Act, Title 50 RCW,sets aside
unemployment reserves to be used for the benefit of persons unemployed
through no fault of their own. RCW 50.01.010. In general, to accomplish this
end, the act provides for the payment of unemployment benefits to unemployed
individuals unless a claimant is disqualified from receiving such benefits.
4A court's authority to remand for further proceedings under RCW
34.05.574 is distinct from its authority to remand for the taking of additional
evidence under RCW 34.05.562. As discussed above, circumstances that would
permit reopening the record are not present here.
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No. 73619-1-1/16
Meyering, 102 Wn.2d at 388-89. An individual is disqualified from receiving
benefits if he or she left work voluntarily without good cause. RCW 50.20.050(1).
The characterization of Robinson's job separation as a voluntary quit depends on
whether he resigned effective immediately or whether he gave notice and Target
accelerated the date of the job separation without paying Robinson through the
notice period. How is the burden of proof allocated in this situation? Did Target
have the burden of proving that Robinson resigned effective immediately, or did
Robinson have the burden of proving that he gave two weeks' notice?
Credibility determination. The agency determined that Robinson's
testimony was not credible when compared to the testimony of the employer's
witnesses. When Robinson's testimony is reassessed in light of this opinion, was
it credible?
4. Robinson's request for an award of attorney fees is premature
Robinson requests an award of attorney fees. If the decision of the
commissioner is reversed or modified, attorney fees "shall be payable out of the
unemployment compensation administration fund." RCW 50.32.160. On
discretionary review, Robinson has demonstrated that he is entitled to relief from
the superior court's decision to require reopening of the record for further fact-
finding. But it is not yet clear that the existing record calls for a reversal or
modification of the commissioner's decision that the job separation was a
voluntary quit. If the outcome on remand is a decision that reverses or modifies
the current decision of the commissioner, the commissioner shall award fees to
Robinson, including fees for this appeal.
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No. 73619-1-1/17
Remanded to the commissioner for further proceedings consistent with
this opinion.
WE CONCUR:
17