Bailey v. Division of Employment Security, North Carolina Department of Commerce

NO. COA13-452

NORTH CAROLINA COURT OF APPEALS

Filed: 21 January 2014

CYNTHIA A. BAILEY,

Petitioner,

v. Buncombe County
No. 12 CVS 05163
DIVISION OF EMPLOYMENT SECURITY,
NORTH CAROLINA DEPARTMENT OF
COMMERCE,

Respondent.

Appeal by respondent from order entered 14 January 2013 by

Judge C. Philip Ginn in Buncombe County Superior Court. Heard in

the Court of Appeals 26 September 2013.

Adams Hendon Carson Crow & Saenger, P.A., by John C. Hunter,
for petitioner-appellee.

North Carolina Department of Commerce, Division of Employment
Security, by Timothy M. Melton, for respondent-appellant.

STEELMAN, Judge.

Where the trial court adopted all of the findings of fact

made by DOC, which as a matter of law supported DOC’s ruling that

petitioner engaged in misconduct, the trial court erred in

reversing the decision of DOC.
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I. Factual and Procedural Background

Cynthia A. Bailey (plaintiff) was employed by Pro Temps

Medical Staffing (Pro Temps). On 11 December 2011, plaintiff’s

employment with Pro Temps was terminated. On 1 January 2012,

plaintiff filed a claim for unemployment benefits. An Adjudicator

found that plaintiff was assigned to monitor a patient who was on

suicide watch; that plaintiff was found sleeping on the job; and

that plaintiff was discharged due to this misconduct and was

disqualified from receiving unemployment benefits. On 2 April

2012, plaintiff appealed pro se to the Appeals Referee.

On 1 May 2012, the Appeals Referee heard the appeal. The

Appeals Referee affirmed the Adjudicator’s determination, and held

that plaintiff was discharged due to misconduct, and therefore was

disqualified from receiving unemployment benefits. The Appeals

Referee further found that while plaintiff was sleeping, the

suicide-watch patient had been wandering the halls of the hospital.

On 31 May 2012, plaintiff appealed pro se to the North Carolina

Department of Commerce, Division of Employment Security (DOC).

On 26 September 2012, DOC adopted the facts found by the

Appeals Referee, concluded that the Appeals Referee correctly

applied the law, and affirmed the decision that plaintiff was

disqualified from receiving unemployment benefits. On 26 October
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2012, plaintiff filed a petition for judicial review to the

Superior Court of Buncombe County.

On 15 January 2013, the trial court entered its order on

judicial review, and held that plaintiff was not disqualified to

receive unemployment benefits.

DOC appeals.

II. Standard of Review

“In cases appealed from administrative tribunals, we review

questions of law de novo and questions of fact under the whole

record test.” Diaz v. Div. of Soc. Servs., 360 N.C. 384, 386, 628

S.E.2d 1, 2 (2006). A determination that an employee has engaged

in misconduct under N.C. Gen. Stat. §§ 96-14 and 96-15 is a

conclusion of law. See e.g. Williams v. Burlington Indus., Inc.,

318 N.C. 441, 456, 349 S.E.2d 842, 851 (1986) (referring to “the

referee's conclusion that petitioner was discharged for

misconduct”).

[I]n cases appealed from an administrative
tribunal under [Article 3 of North Carolina’s
Administrative Procedure Act], it is well
settled that the trial court’s erroneous
application of the standard of review does not
automatically necessitate remand, provided
the appellate court can reasonably determine
from the record whether the petitioner’s
asserted grounds for challenging the agency’s
final decision warrant reversal or
modification of that decision under the
applicable provisions of N.C.G.S. § 150B-
 -4-
51(b).

N.C. Dep’t of Env’t & Natural Res. v. Carroll, 358 N.C. 649, 665,

599 S.E.2d 888, 898 (2004).

When the issue on appeal is whether a state
agency erred in interpreting a statutory term,
an appellate court may freely substitute its
judgment for that of the agency and employ de
novo review. Although the interpretation of a
statute by an agency created to administer
that statute is traditionally accorded some
deference by appellate courts, those
interpretations are not binding. The weight of
such [an interpretation] in a particular case
will depend upon the thoroughness evident in
its consideration, the validity of its
reasoning, its consistency with earlier and
later pronouncements, and all those factors
which give it power to persuade, if lacking
power to control.

N.C. Sav. & Loan League v. N.C. Credit Union Comm’n, 302 N.C. 458,

465-66, 276 S.E.2d 404, 410 (1981) (citations and quotations

omitted).

II. Trial Court’s Standard of Review

In its first argument, DOC contends that the trial court

disregarded the standard of review set out in N.C. Gen. Stat. §

96-15(i). We agree.

N.C. Gen. Stat. § 96-15, concerning the procedure as to claims

for unemployment benefits, provides that, in any judicial review

of a decision by DOC:

the findings of fact by the Division, if there
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is any competent evidence to support them and
in the absence of fraud, shall be conclusive,
and the jurisdiction of the court shall be
confined to questions of law. Such actions and
the questions so certified shall be heard in
a summary manner and shall be given precedence
over all civil cases.

N.C. Gen. Stat. § 96-15(i) (2013).

In the instant case, the Appeals Referee found that:

3. According to the employer's policies and
procedures, of which the claimant knew or
should have known, if an employee is found to
be asleep or giving off the appearance of
sleep while he/she is supposed to be
performing job duties, then said employee may
be subjected to an immediate discharge from
employment.

4. On the claimant's final day of
employment, she [claimant] was found asleep in
a patient's room. The claimant was supposed to
be providing sitter duties for said patient.

5. The above-mentioned patient was on
"suicide watch" and left the room while the
claimant was asleep.

6. A nurse woke up the claimant and informed
her [claimant] that the patient she was to be
watching over was outside of his room at the
nurses' station.

7. The claimant was discharged from this job
for sleeping during her work shift while she
was supposed to be performing her job duties.

The Appeals Referee concluded that:

the claimant fell asleep while she was
supposed to be watching over a patient as a
certified nursing assistant/sitter. The
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employer's policies allow for an employee to
turn down patients and/or shifts if he or she
thinks it would not be prudent or possible to
perform job duties whether that decision is
based on one's comfort level or level of
fatigue. The claimant did not turn down
providing sitting duties for the above-noted
patient during her agreed to work shift. The
claimant's actions were a willful disregard of
the employer's interests and a disregard of
the standards of behavior that the employer
rightfully expected of the claimant. As such,
the claimant was discharged for misconduct in
connection with the work.

On appeal from the Appeals Referee, DOC held that:

As the ultimate fact-finder in cases involving
contested claims for unemployment insurance
benefits, the undersigned concludes that the
facts found by the Appeals Referee were based
on competent evidence and adopts them as its
own. The undersigned also concludes that the
Appeals Referee properly and correctly applied
the Employment Security Law (G.S. §96-1 et
seq.) to the facts as found, and the resultant
decision was in accordance with the law and
fact.

On appeal from DOC, the trial court found simply that “There

is competent evidence in the record to support the findings of

fact made by the Division.” However, the trial court then

concluded that plaintiff’s conduct was not “misconduct” which

would merit disqualification, holding:

The Division's conclusion of law as set out in
the Memorandum of Law Section of the
Division's Decision is in error as a matter of
law in that Petitioner's actions were not,
"conduct evincing a willful or wanton
 -7-
disregard of the employer's interest as is
found in the deliberate violations or
disregard of standards of behavior which an
employer has a right to expect of an employee
or has been explained orally or in writing to
an employee or conduct evincing carelessness
or negligence of such degree or recurrence as
to manifest an intentional and substantial
disregard of the employer's interest or of the
employee's duties or obligations to the
employer," and were not, therefore,
"misconduct" as that term is defined and used
in N.C. Gen. Stat. § 96-14(2).

N.C. Gen. Stat. § 96-14 defines misconduct as:

intentional acts or omissions evincing
disregard of an employer's interest or
standards of behavior which the employer has
a right to expect or has explained orally or
in writing to an employee or evincing
carelessness or negligence of such degree as
to manifest equal disregard.

N.C. Gen. Stat. § 96-14(2) (2011)1.

The findings of fact of the Appeals Referee were adopted by

DOC, and in turn by the trial court upon appeal. These findings

explicitly stated that Pro Temps had a policy that employees found

sleeping were subject to immediate discharge, and that employees

who believed themselves unable to perform had the option to turn

down patients or shifts, and that plaintiff knew or should have

1 N.C. Gen. Stat. § 96-14 was repealed by Session Laws 2013-2,
s.2(a), effective 1 July 2013, and replaced by N.C. Gen. Stat. §
96-14.1 et seq. However, § 96-14 was effective during the
proceedings before the trial court, and we will therefore apply
the definition expressed therein.
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known about these policies. Further, these findings stated that

plaintiff was found sleeping when she had been assigned to a

patient on suicide watch, having chosen not to turn down the shift.

These findings all support the conclusion that plaintiff had

engaged in misconduct, and do not support a conclusion to the

contrary.

Nonetheless, the trial court, despite adopting these findings

in their entirety, concluded that no misconduct had occurred. Its

conclusion is in direct contradiction to the findings it adopted,

and is therefore without a basis in the law.

We hold that the trial court erred as a matter of law in

making conclusions of law which were not supported by its findings

of fact, and reverse and remand this matter to the trial court for

entry of an order affirming the decision of DOC.

III. Other Arguments

Because we have held that the trial court erred as a matter

of law in reversing the decision of DOC, we need not address DOC’s

other arguments.

REVERSED AND REMANDED.

Judges HUNTER, ROBERT C. and BRYANT concur.