Oliver v. Unemployment Compensation Board of Review

DISSENTING OPINION BY

Judge BROBSON.

Respectfully, I dissent. In this appeal, Lañara D. Oliver (Claimant) petitions for review of the order of the Unemployment Compensation Board of Review (Board), which reversed the referee’s grant of benefits under Section 402(e) of the Unemployment Compensation Law (Law).1 Because I believe the Board failed to support its decision for overriding the credibility determination of the referee, I would vacate the Board’s order and remand the matter to the Board for further consideration.2

*443Intervenor Bostley’s Preschool, Inc. (Employer) terminated Claimant’s employment because she violated Employer’s rule that required each child within its care to be supervised at all times. Claimant applied for unemployment compensation benefits. The Scranton UC Service Center (Service Center) determined that Claimant was ineligible for benefits. Claimant appealed the decision, and a referee held a hearing on May 15, 2009. Following the hearing, the referee issued her decision/order, reversing the Service Center’s notice of determination and granting benefits. In support of her decision, the referee made the following findings of fact:

1. The claimant was last employed at Bostley[’]s Pre-School as a full time preschool teacher at the rate of $7.65 per hour from February 26, 2007 through her last day worked of February 26,2009.
2. The claimant was discharged for leaving a two year old child in a play room by himself while outside on the playground with the other children.
3. The employer had a policy which states in part that no child shall ever be left unattended or unsupervised at any time for any reason.
4. Our standard for supervision is that 100% of the children shall be supervised 100% of the time with no exceptions for any reason.
5. The employer’s policy also provides that the following action will be taken for any lapse in supervision regardless of the duration: (1) the employee will be placed on an immediate two week unpaid suspension while the case is being reviewed; (2) subject to the findings of the review, the following may occur: (a) the employee’s employment may be terminated, or (b) the employee may be reinstated in a probationary status for a period to be determined.
6. The claimant received a verbal warning from her direct supervisor on February 13, 2009 in regards to the 100% supervision policy.
7. On February 26, 2009, when taking the six two-year old children she was watching from the playroom to the playroom outside, the claimant counted that she had six children on her way out to the playground.
8. The claimant stumbled over her shoe string and fell into a slide.
9. Upon regaining her balance, the claimant turned around to close the door and was not aware that one of the six children went back inside the playroom.
10. The claimant began playing with the children she was supervising on the playground and a few minutes later noticed that one of the six children was missing, so began to look for him on the playground equipment.
11. The claimant’s supervisor then came over to the claimant and asked her how many children she had to which the claimant responded she had six.
12. The claimant’s supervisor responded, “no you have five, here is number six.”
13. The claimant’s supervisor contacted the executive director and then the executive director contacted the owner of Bostley’s Pre-School and the decision was made to terminate *444the claimant’s employment that same day.
14. On February 26, 2009, the claimant violated the employer’s 100% supervision policy.

The referee credited Claimant’s testimony as to her explanation of the events giving rise to her termination and noted Employer’s corroborating testimony during the hearing to the effect that Claimant’s violation of Employer’s 100% supervision policy was not intentional and was an honest mistake. In other words, Employer did not refute in any way Claimant’s explanation of how the child became separated from the group of children.3

Employer appealed to the Board, which reversed the referee’s decision. The Board made the following findings of fact:

1. The claimant was last employed as a Preschool Teacher by Bostley’s Preschool from February 26, 2007 to February 26, 2009. Her final rate of pay was $7.65 per hour.
2. The employer’s policy mandates that no child be left unsupervised or unattended for any amount of time. A violation of this rule may result in immediate termination.
3. The claimant knew of the employer’s rule.
4. On or about February 13, 2009, the claimant received a verbal warning when she left a room of children unattended in order to help another child in the bathroom.
5. On or about February 26, 2009, the claimant was supervising a group of two-year-olds.
6. The claimant took the group from an indoor playroom to the outdoor playground.
7. The claimant’s supervisor observed one of the children that the clamant was supervising playing alone in the indoor playroom. The supervisor recognized that the child was assigned to the claimant’s group.
8. The supervisor returned the child to the claimant and reported the incident to the executive director of the school.
9. On February 26, 2009, the claimant was discharged for violating the employer’s rule requiring each child to be supervised at all times.

As to Claimant’s explanation of the events that led to the termination of her employment, the Board included the following in the discussion portion of its decision:

The claimant testified that the child was left unattended by accident. The Board does not find the claimant’s assertion credible in light of the fact that the employer had given the claimant a warning two weeks earlier, where she was told that she could not leave the children alone for any reason. The claimant intentionally failed to observe the whereabouts is evident of the children in her care [sic]. Because she had failed to provide sufficient credible testimony or evidence to show good cause for *445violation of the employer’s rule, she must be denied benefits.

(Board Decision & Order at 2-8 (emphasis added).)

Whether the conduct of an employee constitutes willful misconduct is a matter of law subject to this Court’s review. Walsh v. Unemployment Comp. Bd. of Review, 943 A.2d 363, 368 (Pa.Cmwlth.2008). The employer bears the burden of proving that the claimant’s unemployment is due to willful misconduct. Id. The term “willful misconduct” is not defined by statute; however, the courts have defined “willful misconduct” as follows:

(a) wanton or willful disregard for an employer’s interests; (b) deliberate violation of an employer’s rules; (c) disregard for standards of behavior which an employer can rightfully expect of an employee; or (d) negligence indicating an intentional disregard of the employer’s interest or an employee’s duties and obligations.

Grieb v. Unemployment Comp. Bd. of Review, 573 Pa. 594, 600, 827 A.2d 422, 425 (2003). An employer seeking to prove willful misconduct by showing that the claimant violated the employer’s rules or policies must prove the existence of the rule or policy and that the claimant violated it. Walsh, 943 A.2d at 369. If, however, the claimant can show good cause for the violation — i.e., “that the actions which resulted in the discharge were justifiable and reasonable under the circumstances” — then there should be no finding of willful misconduct. Id.

In this case, there is no dispute that Claimant violated Employer’s 100% supervision rule. The referee, however, found that Claimant’s violation did not rise to the level of willful misconduct in light of Claimant’s uncontradicted testimony, which Employer’s witness corroborated, that Claimant did not act intentionally when she allowed a child to become separated from the group of two-year old children that Claimant was supervising. The Board, however, concluded that Claimant’s explanation was not credible. As the ultimate finder of fact, the Board certainly had the right to disbelieve Claimant, even though her testimony was uncontradicted. Treon v. Unemployment Comp. Bd. of Review, 499 Pa. 455, 460, 453 A.2d 960, 962 (1982). The Board, however, is not free to disregard findings of the referee based upon consistent and uncontradicted evidence without providing the reasons for its reversal. Id. at 461, 453 A.2d at 962. In Treon, the Pennsylvania Supreme Court explained:

[T]he Board did not have the right to arbitrarily and capriciously disregard the findings of the referee after the referee had listened to the testimony of the only witness and observed his demeanor, and had made findings of fact based upon that uncontradicted testimony.
If particular findings are inconsistent, incredible or unsupported by the evidence, then the Board must so indicate. The Board may not, however, simply disregard findings made by the referee which are based upon consistent and uncontradicted testimony without stating its reasons for doing so.

Id. 4

This Court applied the Pennsylvania Supreme Court’s decision in Treon in Office *446of Attorney General v. Unemployment Compensation Board of Review, 111 Pa. Cmwlth. 187, 533 A.2d 1087 (1987) (OAG). In OAG, a willful misconduct termination case, the employer testified and presented evidence at the hearing before the referee. The claimant did not testify or offer evidence. The referee thus ruled in favor of the employer, concluding that the claimant knowingly lied and misled the employer. The claimant appealed. The Board reversed, finding that the claimant did not knowingly lie and mislead the employer. The employer appealed to this Court, contending that the Board erred “by disregarding the referee’s findings of fact, without stating its reasons for doing so, where only [the employer] presented evidence before the referee and the Board heard no additional testimony.” OAG, 533 A.2d at 1088.

This Court agreed, concluding that (a) the referee’s findings were supported by the evidence adduced at the hearing, (b) the Board’s reasons for reversing the referee’s findings were not “plain enough” from the record, and (c) the Board did not set forth reasons for the reversal in its decision. Id. at 1089. Unable to determine why the Board reversed the referee, this Court vacated the Board’s decision and remanded to give the Board an opportunity to set forth its reasons for reversing the referee’s decision. Id.

In this case, although the Board purports to give a reason for rejecting Claimant’s uncontradicted testimony and the referee’s findings and conclusions based thereon, more than a cursory review of the Board’s explanation reveals that it is no explanation at all. The Board’s purported *447reason for finding Claimant’s testimony not credible is “the fact that the employer had given the claimant a warning two weeks earlier, where she was told that she could not leave the children alone for any reason.” (Board Decision & Order at 2.) This fact, which is also undisputed, does not explain the Board’s decision to discredit Claimant’s account of the events on February 26, 2009, for which Employer terminated Claimant’s employment. At most, this fact merely shows that Claimant was aware of Employer’s 100% supervision rule; therefore, it goes only to the issue of whether Employer met its burden to prove that it terminated Claimant’s employment for willful misconduct — in this case, a violation of a work rule.

Claimant does not dispute that she knew of Employer’s 100% supervision rule or that Employer previously reprimanded her for failing to follow the rule. Even the referee concluded that Claimant violated the work rule. The referee’s findings and conclusions at issue in this appeal relate, instead, to Claimant’s effort to show “good cause” for the violation of the work rule. The referee concluded that Claimant met her burden through her uncontradicted testimony that on February 26, 2009, Claimant tripped and fell into a slide while supervising a group of six two-year olds. As a result, she lost sight of one of the children, who ran inside while she was in the process of falling and regaining her balance. (Referee Findings of Fact Nos. 7-9.) The referee accepted this uncontra-dicted testimony as truthful, noting also that Employer’s witness agreed that Claimant did not act intentionally.

Under Treon, if the Board wished to reach contrary findings (which it was entitled to do), the Board was required to state its reasons for doing so. The referee’s findings with respect to the events on February 26, 2009, which supported the referee’s conclusion that Claimant’s employment was not terminated for “willful misconduct,” are supported by Claimant’s uncontradicted testimony and Employer’s corroborating testimony during the hearing before the referee. The Board has not set forth its reason for reversal, and the Board’s reason for reversal is not “plain enough” from the record. See OAG, 533 A.2d at 1089.

Because I am unable to determine why the Board reversed the referee, there is not an adequate basis for judicial review.5 *448Accordingly, I would vacate the Board’s decision and order and . remand the matter to the Board so it may reconsider the matter.

Judge LEAVITT joins in this dissenting opinion.

. Act of December 5, 1936, Second Ex.Sess., P.L. (1937) 2897, as amended, 43 P.S. § 802(e). Section 402(e) of the Law provides that an employee shall be ineligible for unemployment compensation benefits where the unemployment is due to discharge for "willful misconduct.”

. The Majority concludes that Claimant did not adequately raise the issue of whether the Board failed to support its decision for overriding the credibility determination of the referee. In her Statement of Questions Involved, Claimant asks "[wjhether the [Board] committed an error of law by applying the incorrect legal analysis in concluding that employee’s accidental actions amounted to willful misconduct.” (Claimant’s Br. at 4) In the first paragraph of her Summary of Argument, Claimant writes:

[Claimant] argues that the [Board] erred where there was undisputed testimony that [Claimant’s] actions amount to an honest mistake, yet it found she had committed willful misconduct and thus determined her ineligible for Unemployment Compensation benefits.

(Claimant’s Br. at 7 (emphasis added).) Finally, Claimant raises at other portions of her brief her challenge to the Board’s decision despite the uncontradicted evidence supporting her story of the events on February 26, *4432009. (Claimant's Br. at 8, 10.) Accordingly, Claimant has raised and preserved for our appellate review the issue of whether the Board erred in reversing the referee's decision in the face of uncontradicted evidence in the record to support the Referee's decision.

. One of Employer's witnesses offered a closing statement, during which she testified:

I would just like to say that this is not the first time that we have let somebody go for this reason. We have a policy; we enforce it. If children are not supervised, any staff member at any time should be able to walk up to them and ask them how many children they have in their care, should be able to tell us how many, and know those children by name. Do I feel this was intentional? No. But accidents happen because things are not intentional, and that's why we have this policy. We have to enforce it.

(Transcript of Testimony at 15 (emphasis added).)

. The Majority concludes that Treon may not have been triggered in this case because the referee's findings of fact were based on inconsistent and contradictory testimony. The term "inconsistent” has been defined as "not compatible with another fact or claim.” Black’s Law Dictionary 834 (9th ed.2009). "Not compatible,” or "incompatible,” in turn, means "incapable of association or harmonious coexistence." Merriam Webster’s Collegi*446ate Dictionary 588 (10th ed.1997). Testimony is inconsistent, therefore, where two statements cannot exist in the same space.

The Majority maintains, first, that Claimant's testimony was internally inconsistent, stating:

[I]n Claimant’s original appeal of the denial of benefits by the Unemployment Compensation Service Center, she stated "I did not realize this child had run back inside until my Director [Schon] brought it to my attention.” Appeal of Denial of Claim, April 17, 2009, at 1. In her testimony before the referee, Claimant testified that she tripped over her shoe strings and then recovered and picked up her roll book. As she began to play with the children, she realized that the child was missing. Claimant’s statements are inconsistent and contradict one another.

(Majority Op. at 440.) Viewed in the context of Claimant’s entire testimony, it is apparent that these statements are not inconsistent. Without question, Claimant's statement to the UC Service Center has no bearing on Claimant’s testimony that she lost sight of the child when she tripped over her shoelaces. For example, it is not as if Claimant informed the UC Service Center that she lost sight of the child because she was using her cell phone. Moreover, simply because Claimant did not realize the child was inside does not mean she did not realize the child was missing. Claimant testified that, upon recovering from her fall, she became aware the child was missing and began searching the outdoor playground area, not realizing the child had gone back inside. (Transcript of Testimony at 13-14.)

The Majority further posits that Claimant's testimony was contradicted by Ms. Schon's testimony that: “I went to proceed to ask [Claimant] how many children she had ... and she stated that she had six, and I said, ‘No,’ I said, 'You have five, because here is your sixth one.' ” (Transcript of Testimony at 9.) The Majority interprets this testimony to mean that Claimant was not aware the child was missing until Ms. Schon presented her with the child, thereby refuting Claimant’s testimony that she discovered the child was missing after she recovered from her fall. Just as plausible of an interpretation, however, is that Claimant answered that she had six children because Claimant, in fact, had six children under her charge on February 26, 2009. Merely because testimony is capable of being interpreted differently does not mean that it is inconsistent — especially where Claimant’s own account of the above exchange is virtually identical to Ms. Schon's account.

. The Majority's final contention is that Claimant would be ineligible for benefits even if the Board failed to explain its reasoning for rejecting Claimant’s testimony, because such an error is harmless. The Majority concludes that Claimant did not have good cause for violating Employer’s rule regardless of whether her actions constituted an honest mistake because Claimant admitted that she did not perform a roll count of the children after she recovered from her fall. In support, the Majority cites Heitczman v. Unemployment Compensation Board of Review, 162 Pa.Cmwlth. 275, 638 A.2d 461, appeal denied, 538 Pa. 660, 648 A.2d 791 (1994).

In Heitczman, the employer’s policy required its truck drivers to walk completely around their trucks before driving in reverse to ensure that their path of travel was clear. Without performing a "walk around,” Heitcz-man backed up his truck and collided with a light standard, damaging the truck and the light standard. The employer terminated the claimant for violation of the "walk around” policy and Heitczman filed for unemployment compensation. Before this Court, Heitczman argued that his conduct was merely negligent and did not constitute willful misconduct because he did not deliberately back up the truck improperly. Determining that Heitcz-man did not have adequate justification for violating the employer’s policy, we stated:

[Tjhere is no question of mistake. [Heitcz-man] knew of the existence of the work rule, specifically failed to follow it by backing up his truck without making a "walk around” and, as a result, hit the light standard that crashed onto the roof of his Em*448ployer’s truck. Such conduct ... is more akin to disobedience of a direct instruction.

Id. at 281, 638 A.2d 461.

Here, Employer’s policy required that 100% of the children be supervised 100% of the time. To comply with this policy, the Majority concludes that Claimant should have counted the children once outside. The Majority maintains that Claimant’s failure to do so was akin to Heitczman’s failure to perform a "walk around.” The employer's policy in Heitczman, however, imposed an affirmative duty on truck drivers to perform a "walk around” before backing up. Heitczman's failure to perform a "walk around,” therefore, was a clear violation of the employer’s policy, regardless of whether striking the light standard was an honest mistake. In contrast, Claimant's failure to count the children immediately upon exiting the building was not a clear violation of Employer's 100% supervision policy. While this might be an effective method for ensuring 100% supervision of the children at all times, the language of the Employer’s policy did not clearly and unequivocally mandate roll calls or counts. Thus, the Majority is attempting to engraft a requirement on Claimant not imposed by Employer's work rules.