Michael Nevler v. Employment Security Department

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
MICHAEL NEVLER, )
) No. 76327-0-1
Appellant, )
) DIVISION ONE
V. )
)
STATE OF WASHINGTON ) UNPUBLISHED OPINION
EMPLOYMENT SECURITY )
DEPARTMENT, ) FILED: January 16, 2018
)
Respondent. )
)
BECKER, J. — Appellant was fired from his restaurant job for sitting down at
a table with a customer, in violation of a policy against fraternization with
customers. The Department of Employment Security denied his request for
unemployment benefits on the basis that he was terminated for willful
misconduct. We find no error in the commissioner's decision.
Appellant Michael Nevler was employed as a server at a restaurant from
May 2007 until his termination on June 12, 2015. His application for
unemployment benefits was denied. He appealed. An administrative law judge
held a telephonic hearing at which three witnesses testified: Anthony Berkau, the
employer's food and beverage director; Sara Fetters, the employer's human
resources director; and Nevler.
No. 76327-0-1/2
At the hearing, the administrative law judge held the employer to the
burden of proving work-related misconduct. Conclusion of Law 6, citing
Yamamoto v. Puget Sound Lumber Co., 84 Wash. 411, 146 P. 861 (1915). The
administrative law judge entered findings of fact and conclusions of law
upholding the denial of benefits on the basis that Nevler intentionally violated a
known, reasonable employer policy without excuse. The commissioner's review
office adopted those findings and conclusions. See RCW 34.05.464. That
decision was affirmed on review by the superior court. Nevler now appeals to
this court.
This court sits in the same position as the superior court, reviewing the
final administrative decision issued by the commissioner. Tapper v. Emp't Sec.
Dep't, 122 Wash. 2d 397, 402, 858 P.2d 494 (1993). "Judicial review of a final
administrative decision of the Commissioner of the Employment Security
Department is governed by the Washington Administrative Procedure Act."
Tapper, 122 Wash. 2d at 402. A reviewing court may reverse an administrative
decision when:(1)the administrative decision is based on an error of law;(2)the
decision is not based on substantial evidence; or(3) the decision is arbitrary or
capricious. Tapper, 122 Wash. 2d at 402. We apply the standards of the
Washington Administrative Procedure Act, chapter 34.05 RCW,directly to the
record before the agency. Tapper, 122 Wash. 2d at 402. As the party challenging
the agency action, Nevler carries the burden to show the commissioner's
decision was in error. Campbell v. Emp't Sec. Dep't, 180 Wash. 2d 566, 571, 326
P.3d 713(2014), citing RCW 34.05.570(1)(a).
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Whether an employee's behavior constitutes misconduct is a mixed
question of law and fact. Tapper, 122 Wash. 2d at 402. We give deference to the
agency's factual findings. The process of applying the law to the facts is a
question of law subject to de novo review. Tapper, 122 Wash. 2d at 403.
The statutory definition of misconduct includes "Willful or wanton disregard
of the rights, title, and interests of the employer or a fellow employee."
RCW 50.04.294(1)(a). When the employee's act is a violation of a company rule,
it is considered misconduct under the statute "if the rule is reasonable and if the
claimant knew or should have known of the existence of the rule."
RCW 50.04.294(2)(f).
The following facts are undisputed. Nevler had previously been off work
for some time due to an injury. On the night of the incident that led to his firing,
he was working light duty. He was assisting the servers by selling wines to
customers, taking wine inventory, refilling water glasses for diners, and
performing other tasks he could do without repetitive bending or heavy lifting. A
fellow server asked Nevler to assist a female customer with wine selection.
Nevler sat down at the table with the customer to discuss the wine choices. The
customer ultimately purchased a $100 bottle of wine.
Berkau heard from other employees that Nevler had spent over an hour
sitting with the customer. After a brief investigation, Berkau made the decision to
terminate Nevler for violating the establishment's antifraternization policy. Nevler
had no prior discipline or issues related to violation of the fraternization ban.
Berkau testified that he decided termination rather than a warning was
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appropriate because of the "severity of the issue" and because he believed
Nevler was taking advantage of the supervisor and other workers who were on
duty that night.
FACTUAL FINDINGS
Nevler challenges 10 findings of fact leading to the commissioner's
conclusion of willful misconduct. The first, finding of fact 2, is a general finding
that the employer's witnesses were more credible than Nevler. Nevler contends
this finding cannot stand because, he claims, all of the relevant evidence was
hearsay. Neither Berkau nor Fetters was in the restaurant on the night Nevler
sat down with the customer.
Nevler's objection is not well taken. Unchallenged findings of fact 10, 11,
and 12 make clear that the administrative law judge was well aware it is not
permissible to rely on hearsay that "unduly abridges a party's ability to rebut
evidence or confront witnesses." These three findings confirm that the agency
decision was "not based on any of the hearsay provided by the employer":
10. Hearsay is a statement, either oral or written, made by some
person other than the person testifying at the hearing, offered
in evidence to prove the truth of an assertion made by a party.
Hearsay is evidence which is not supported by live testimony
and is not subject to cross-examination.
11. RCW 34.05.452 provides that evidence, including hearsay
evidence, is admissible if in the judgment of the administrative
law judge it is the kind of evidence on which reasonably
prudent persons are accustomed to rely in the conduct of their
own affairs. Hearsay evidence which unduly abridges a party's
ability to rebut evidence or confront witnesses cannot be relied
upon by the administrative law judge in making the decision.
12. In this case, reliance on hearsay evidence from other
witnesses, who are not at the hearing, deprives claimant of his
opportunity to adequately rebut that evidence and cross-
examine these witnesses. This type of hearsay is not
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sufficiently reliable upon which to make findings and base a
decision. This decision is not based on any of the hearsay
provided by the employer.
Nevler next contends the record lacks substantial evidence to support the
findings that the employer had a policy forbidding servers from seating
themselves with customers and that the policy was communicated to him.
Substantial evidence is sufficient to persuade a rational fair-minded person of the
truth of the matter asserted. Campbell, 180 Wash. 2d at 571.
Finding of fact 4 states there was a written policy against fraternizing with
customers:
The employer has a written policy, contained in the employee
handbook, which states fraternization with customers is forbidden.
This would include sitting down at the dinner table to chat. Selling
wine typically takes only a few minutes, and the servers are not
allowed to sit down to do so. Even if a customer wanted to try
numerous wines, the server is not allowed to join the customer by
seating himself or herself at the table.
Finding of fact 5 states that Nevler was aware of the rule against joining a
customer at the table:
Claimant knew the rule at issue, and had received the handbook
when hired. Updates are made by memos to the staff. However,
the no-fraternization rule has been the same since 2007, according
to the HR Director, who has been working for the employer that
entire time. Claimant's supervisor has discussed the rule at issue,
"no sitting at the table with a customer," with all the servers at pre-
shift meetings.
The handbook is not in the record. Nevertheless, the record supports the
findings. Fetters testified that an antifraternization policy was in the employee
handbook. She said the policy was included in the employee handbook and new
employee orientation at least since 2007, when Nevler was hired. Berkau
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testified that the issue of sitting with customers had come up in the past, and he
had verbally instructed all employees that it was not appropriate. This is
substantial evidence supporting the finding that a written antifraternization policy
was in place, including a ban on sitting down to chat with a customer at a table,
and Nevler was aware of it.
Next, Nevler contends the agency decision impermissibly relied on
hearsay to establish findings 7, 8, and 9:
The Food and Beverage Director received information from a
supervisor who was at the restaurant on June 9, 2015, indicating
that claimant sat at a dinner table with a female customer for over
an hour while on the clock.
Finding of Fact 7.
Further, the supervisor told the Director that claimant asked the
supervisor to clock him out at about 10:30 p.m., but to indicate he
quit work at 9:30 p.m., an hour earlier, so he would not be paid for
the hour he sat with the woman. Claimant clearly knew he was not
working during that hour, and should not be paid during the time he
spent visiting with the female diner.
Finding of Fact 8.
When interviewed by the employer, claimant told the HR Director
that he sat with the woman for 20 to 30 minutes. The Director of
Food and Beverage ("Director") remembered claimant saying he
sat with her 15 to 20 minutes. Neither of these employer witnesses
was present at the time of the incident, but heard about it from
others. Therefore, this part of the employer's testimony is based on
hearsay.
Finding of Fact 9.
Nevler contends that because Berkau and Fetters did not have personal
knowledge of how long he sat at the table or what he said to the supervisor about
his timecard, the agency decision contains unsupported determinations on those
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No. 76327-0-1/7
factual issues. Nevler denied requesting an adjustment to his timecard. He
testified that his supervisor was the one who proposed adjusting the timecard,
and he said he agreed because he was already over his scheduled light-duty
hours.
Findings 7, 8, and 9 summarize testimony given by Berkau and Fetters
about what they were told by other employees. Hearsay estimates of the amount
of time Nevler spent sitting at the table and the supervisor's account of his
conversation with Nevler about the timecard were not accepted by the agency
decision as the truth of the matter asserted. Nevler's timecard is not mentioned
in the conclusions of law. The agency's rejection of hearsay as a basis for the
decision is confirmed by finding of fact 12:
In this case, reliance on hearsay evidence from other witnesses,
who are not at the hearing, deprives claimant of his opportunity to
adequately rebut that evidence and cross-examine those
witnesses. This type of hearsay is not sufficiently reliable upon
which to make findings and base a decision. This decision is not
based on any of the hearsay provided by the employer.
Finding of Fact 12.
Nevler contends that, contrary to finding of fact 12, the agency actually
relied heavily on hearsay. He does not back up this argument. In context,
findings 7, 8, and 9 do not contain facts the agency relied on to reach its
conclusion. Rather, they are included to show how the incident came to Berkau's
attention and why Berkau decided to investigate it by talking directly to Nevler.
As to the amount of time that Nevler spent sitting with the customer, the
agency decision gave Nevler the benefit of the doubt with a finding based solely
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No. 76327-0-1/8
on his own testimony at the hearing. That determination is found in findings of
fact 13 and 14:
Claimant now asserts he spent 30 to 40 minutes with the woman,
but it was not "consecutive," in that he had to go back and forth to
fetch bottles of wine and glasses for her to taste the various wines.
Claimant maintains he never thought he was in violation of any
policy by sitting at the dining table with the customer. He was
dressed in street clothes and not a server's uniform.
Finding of Fact 13.
Statements made by parties themselves are not hearsay, but are
party admissions. Claimant made statements to the employer, and
in his testimony at this hearing, which reveal he did sit at the
woman's table for at least some part of 30 to 40 minutes. The
employer's testimony about the policies shows that claimant knew
or should have known sitting with, or "fraternizing" with customers
at their dining tables, violates the employer's policies.
Finding of Fact 14.
Nevler contends findings of fact 13 and 14 misconstrue his testimony.
They do not. Nevler testified that he was at the table with the customer for a total
of"maybe between 30 and 40-something minutes. But it was not consecutive."
He testified that during his session with the customer, he made a number of trips
to obtain new wine and glasses, and had three or four interactions with other
tables. Based on this testimony, there is substantial evidence to support the
finding that Nevler sat at the customer's table for "at least some part of 30 to 40
minutes." Notably, Berkau testified that even if the total amount of time Nevler
sat at the table totaled only 10 or 15 minutes, it "still wouldn't be acceptable....
Sitting at a table with a guest—they—they are not paying us to sit down at the—
the table with them and enjoy their meal."
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No. 76327-0-1/9
Finally, Nevler challenges a finding that he admitted to Berkau that he
would not have sat down with the customer if Berkau had been there. Finding of
fact 15 is the linchpin for the agency's conclusion that Nevler knew he was
violating the employer's policy:
Claimant also told the Director he would not have sat down with the
customer at her table if the Director had been present instead of a
newer supervisor. The Director feels this shows claimant was
intentionally taking advantage of the less experienced supervisor to
violate the policies claimant knew were in place. The evidence
supports the Director's view, in that claimant's actions and
admissions show he was likely taking advantage of the less
experienced supervisor to violate the policy that night.
Finding of Fact 15.
At the hearing, Berkau gave direct testimony that supports this finding. He
said he asked Nevler, "'If 1 was there and if 1 was managing that evening, would
you have spent the amount of time with that guest at the table? Would you sit
down with the guest?' He said he wouldn't, um,so 1 feel like he also took
advantage of a supervisor that he thought wouldn't, uh, wouldn't maybe mind him
doing what he did." What Nevler said in response to Berkau's question is an
admission by a party opponent, so it is not hearsay and was properly taken into
consideration by the agency.
At the hearing, Nevler did not contradict Berkau's testimony on this point.
Only in his petition for review by the commissioner did Nevler offer a competing
version of the conversation. He wrote that Berkau "told me, not asked me,that!
wouldn't do that if he was present, and [said 1 wouldn't have to because the
server would come to him for that kind of picky customer with wine instead of
me." This explanation comes too late. A reviewing officer cannot take additional
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No. 76327-0-1/10
evidence outside the record. Towle v. Dep't of Fish & Wildlife, 94 Wash. App. 196,
205, 971 P.2d 591 (1999). The finding of fact that Nevler would not have sat
down with the customer if Berkau had been present was undisputed on the
record of the hearing.
In summary, the challenged findings of fact are supported by substantial,
nonhearsay evidence.
CONCLUSION OF MISCONDUCT
The agency decision concludes,"The preponderance of the evidence
shows that claimant's actions were an intentional violation of known, reasonable
employer policies, and amounted to statutory misconduct under
RCW 50.04.294." Conclusion of Law 10. Nevler contends that even if the
findings of fact are supported, the department made an error of law in concluding
that he committed misconduct.
Nevler claims that the restaurant regularly tolerated the practice of servers
sitting with customers. This court addressed an employer's allegation of
misconduct in circumstances where corporate policy conflicted with actual
practice in Albertson's, Inc. v. Employment Security Department, 102 Wash. App.
29, 15 P.3d 153(2000). In Albertson's, a supermarket employee was terminated
for purchasing expired meats at a discounted price in violation of the employer's
policy. Albertson's, 102 Wash. App. at 32. Evidence was presented that
employees were routinely allowed to purchase expired food by the department
manager in contravention of corporate policy. Albertson's, 102 Wash. App. at 33.
Because the supermarket's corporate policies were at best unclear', the court
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affirmed the agency's conclusion that the employee had not committed willful
misconduct. Albertson's, 102 Wash. App. at 42.
In the present case, Berkau testified that in the past, there had been "more
than one server" who felt that it was "appropriate" to sit down at a table and
discuss food or wine with the guest, but he had never seen it happen for more
than a minute or two. Berkau also testified that he had addressed this behavior
by instructing staff that such acts were not allowed. Nothing in the record
contradicts Berkau's testimony. Unlike in Albertson's, there is no evidence that
violations of the rule were routinely condoned.
Nevler also contends the agency erred by concluding his violation was
willful. "Misconduct' does not include:. ..(b) Inadvertence or ordinary
negligence in isolated instances; or(c) Good faith errors in judgment or
discretion." RCW 50.04.294(0(3). Nevler had not been disciplined in the past for
violating the policy against fraternizing with customers. He testified that he did
not willfully violate the policy but simply responded to a request from a busy
server who did not have time to answer the customer's many questions about
wine selection. Nevler said that because he was on light duty, he was dressed in
plain clothes like a manager, not as a server, and hence it was reasonable for
him to believe the policy did not apply to him on the night in question. He points
out that his attention to the customer resulted in her purchase of an expensive
bottle of wine.
Nevler cites Michaelson v. Employment Security Department, 187 Wn.
App. 293, 349 P.3d 896(2015). In Michaelson, a delivery driver was terminated
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after being involved in three preventable driving accidents in the span of 12
months. Michaelson, 187 Wash. App. at 297. The agency's denial of
unemployment benefits was reversed. The appellant's poor driving record
demonstrated at most a failure to exercise reasonable care, not willful
misconduct. Michaelson, 187 Wash. App. at 301-02.
Nevler also cites Wilson v. Employment Security Department, 87 Wash. App.
197, 940 P.2d 269 (1997). In Wilson, a jeweler was terminated for losing several
loose diamonds. Wilson, 87 Wash. App. at 199. The agency's denial of benefits
was reversed. There was no evidence in the record to show that the employee
acted with a deliberate intent. "Actions or failures to act that are simply negligent,
and not in defiance of a specific policy, do not constitute misconduct in the
absence of a history of repetition after warnings." Wilson, 87 Wash. App. at 203.
Michaelson and Wilson are of no avail to Nevler. As discussed above,
substantial evidence supports the finding that he was aware that his conduct
violated a specific policy. There is no evidence to support the idea that the policy
applied to servers only if they were in a server uniform. According to Nevler's
own testimony, he spent more than 15 minutes seated with the customer, an
amount of time that is inconsistent with a momentary lapse in judgment. And
most significantly, Nevler admitted to Berkau that he would not have sat down at
the table to sell the wine if Berkau had been there. Because the findings show
that Nevler acted deliberately rather than carelessly, the commissioner did not err
in concluding that Nevler's conduct showed a willful disregard for his employer's
interests.
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Finally, Nevler contends the commissioner's ruling was arbitrary and
capricious. "For an agency's decision to have been 'arbitrary or capricious,' the
decision must have been willfully unreasonable, without consideration and in
disregard of facts or circumstances." W. Ports Transp., Inc. v. Emp't Sec. Dep't,
110 Wash. App. 440, 450, 41 P.3d 510 (2002), quoting Buell v. City of Bremerton,
80 Wash. 2d 518, 526,495 P.2d 1358 (1972). Having found that the
commissioner's ruling was supported by substantial evidence and the law was
properly applied, we conclude that the commissioner was neither arbitrary nor
capricious.
Affirmed.
WE CONCUR:
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