IN THE SUPREME COURT OF THE STATE OF IDAHO
Docket No. 36501
)
MATTHEW S. ADAMS, )
)
Boise, January 2011 Term
Claimant-Appellant, )
)
2011 Opinion No. 15
v. )
)
Filed: February 3, 2011
ASPEN WATER, INC., Employer, IDAHO )
DEPARTMENT OF LABOR, )
Stephen W. Kenyon, Clerk
)
Respondents. )
_______________________________________ )
Appeal from the Industrial Commission of the State of Idaho.
The decision of the Industrial Commission is affirmed.
Matthew S. Adams, Garden City, appellant pro se.
Honorable Lawrence G. Wasden, Attorney General, Boise, for respondent. Tracy
Rolfsen argued.
_____________________
J. JONES, Justice.
Matthew Adams appeals the Industrial Commission’s determination that he is not eligible
for unemployment benefits because he was terminated for employment-related misconduct. We
affirm.
I.
Factual and Procedural Background
Matthew Adams was employed by Aspen Water, Inc., a firm that sells and services water
softening systems, from September of 2007 until his termination on November 4, 2008. Adams
worked as an installer and generally spent his time conducting installations, making service calls,
or completing paperwork around the office. In October of 2008, Adams sustained a workplace
injury and was placed on light duty.
The events that led to Adams’ termination occurred on November 3, 2008. On that
morning, Adams completed a service call around 9:30 a.m. After completing the service call, he
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took an early lunch break. After his lunch break, Adams went to the Department of Motor Vehicles
(DMV) to renew his driver’s license. After realizing the line to renew his license was too long, he
returned to work around 12:35 p.m. Around 2:00 p.m., Adams turned in his log sheet, left work in
his personal vehicle, and again returned to the DMV to attempt to renew his driver’s license.
Adams did not seek permission from anyone at Aspen prior to visiting the DMV on either
occasion.
Around 3:00 p.m., while Adams was at the DMV the second time, Terry Sidwell, the
owner of Aspen, called Adams on his company cell phone, and Adams informed Sidwell that he
was at the DMV. Adams did not return to work after visiting the DMV for the second time. Adams
was terminated the following day for leaving work without permission and failing to notify anyone
at Aspen that he would not be returning to work. Aspen did not fill Adams’ position as an installer
following his termination.
Adams subsequently submitted a claim for unemployment benefits, and the Idaho
Department of Labor (IDL) initially found that he was not eligible for benefits because he was
terminated for employment-related misconduct. 1 Adams then appealed the decision regarding his
eligibility status, and a telephonic hearing was held on the matter before the IDL Appeals
Examiner. At the hearing, Adams argued that his termination was not a result of any misconduct
on his part but, rather, was a result of Aspen’s desire to terminate him for financial reasons.
According to Adams, prior to his termination, Aspen had been experiencing financial problems,
including gas credit cards being shut off and accounts at their plumbing supply store being frozen.
Adams argued that Aspen was motivated to terminate him due to its financial distress, which is
why his position was not filled after he was terminated. Adams also contended that Aspen was
upset with him for filing a workers’ compensation claim to cover the work-related injury that he
had incurred two weeks prior to his termination, which was another possible motive for his
termination. 2
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The record indicates that Aspen initially took the position that Adams had voluntarily quit his employment with
Aspen. This is troubling given that Adams had only missed one afternoon of work, while the policy in Aspen’s
employee handbook states that “[t]wo consecutive days of absence is considered voluntary termination.” However,
the Appeals Examiner found that Adams was terminated by Aspen, and the arguments on appeal to this Court focus
on whether Adams’ termination was a result of employment-related misconduct.
2
Adams testified that Sidwell had tried to convince him to cover his work-related injury through personal insurance
rather than submitting a claim for workers’ compensation.
2
Additionally, while Adams conceded he did not notify Aspen prior to visiting the DMV on
either occasion, he testified that it was common for installers at Aspen, including himself, to run
personal errands on company time as long as it did not interfere with service calls or other job-
related responsibilities. Adams acknowledged the existence of a provision in Aspen’s employee
handbook that required employees to obtain permission prior to attending to personal business
during work hours, but asserted that Aspen never followed this policy and continuously allowed
employees to run personal errands during work hours without first notifying Aspen. While Adams
did admit at the hearing that he had never previously taken three hours off work in one day without
notifying Aspen, he testified that he did not contemplate that the DMV would be so busy that it
would take several hours for him to renew his license.
Finally, Adams argued that because Aspen’s employee handbook provides for a
progressive disciplinary procedure, which includes a verbal or written warning prior to termination,
it was unreasonable for Aspen to terminate him without first warning him that he could be
terminated for not notifying Aspen before running a personal errand at work. Adams continually
asserted that he had never been reprimanded for any of his behavior at work and was a valuable
and appreciated employee at Aspen.
On the other hand, Aspen argued that even though it generally tried to work with
employees who needed to run personal errands during work, employees were consistently required
to adhere to the break policy laid out in the handbook by notifying a supervisor prior to leaving
work for personal reasons. Aspen agreed that Adams had previously been allowed to take care of
personal business during work hours if it did not interfere with his work responsibilities, but argued
that Adams cost the company money when he left work for the entire afternoon without notifying
anyone. Finally, Aspen argued that it was not required to warn Adams prior to terminating him
because, while the handbook denotes a progressive disciplinary scheme, the handbook also makes
clear that it is within the employer’s discretion to determine the appropriate corrective action,
which includes termination. While Aspen conceded that Adams’ actions on November 3 were a
one-time incident, it argued that the seriousness of his actions warranted termination.
The Appeals Examiner ultimately concluded that Adams was discharged for reasons
unrelated to employee misconduct and, thus, was eligible for unemployment benefits. More
specifically, the Appeals Examiner concluded that because it was an accepted practice for installers
to run personal errands without notifying Aspen, it was “inappropriate to label the events of
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[Adams’] final day as any kind of egregious policy violation that justified overriding the
progressive disciplinary procedures in favor of immediate termination.” The Appeals Examiner
also found that because Adams had recently suffered a work-related injury and Aspen had decided
not to hire another installer to fill Adams’ position, Aspen could have been motivated to terminate
Adams for reasons other than misconduct.
Thereafter, Aspen appealed the decision to the Industrial Commission. After conducting a
de novo review of the record, the Commission concluded that Adams was not eligible for
unemployment benefits because his termination was a result of employment-related misconduct.
According to the Commission, the fact that Aspen was experiencing financial difficulties and was
unhappy that Adams had applied for workers’ compensation did not excuse Adams from leaving
work in the middle of the day without permission. The Commission found that even though it was
common for installers at Aspen to take time off work to run short personal errands, such as trips to
the bank, without first notifying Aspen, Adams did more than simply run a short errand when he
took three hours off in a single day to conduct personal business. The Commission further found
that although the record did not establish that Aspen communicated to Adams its expectation that
he obtain permission prior to taking an extended absence, “an employer has a reasonable
expectation that an employee will show up for work and stay at work, and [] such an expectation
flows naturally from the employment relationship.” Adams timely appealed the Commission’s
decision to this Court.
II.
Issue on Appeal
I. Whether the Commission’s factual finding that Adams was terminated for
employment-related misconduct is supported by substantial and competent
evidence.
III.
Discussion
A. Standard of Review
When reviewing a decision from the Industrial Commission, this Court exercises free
review over questions of law. IDAHO CONST. art. V, § 9; Harris v. Electrical Wholesale, 141
Idaho 1, 3, 105 P.3d 267, 269 (2004). The Commission’s findings of fact will only be disturbed
if not supported by substantial and competent evidence. Henderson v. Eclipse Traffic Control &
Flagging, Inc., 147 Idaho 628, 631, 213 P.3d 718, 721 (2009). Substantial and competent
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evidence is “relevant evidence that a reasonable mind might accept to support a conclusion.” Id.
The Commission’s findings will not be disturbed solely because there is conflicting evidence in
the record, or because the Court may have reached a different conclusion. Harris, 141 Idaho at 3,
105 P.3d at 269. “[I]t is up to the Commission to weigh the conflicting evidence and determine
the credit and the weight to be given the testimony admitted.” Henderson, 147 Idaho at 631, 213
P.3d at 721. Furthermore, all facts and inferences are viewed in favor of the prevailing party
before the Commission. Higgins v. Larry Miller Subaru-Mitsubishi, 145 Idaho 1, 4, 175 P.3d
163, 166 (2007).
B. Employment-Related Misconduct
An individual is only entitled to unemployment benefits where “[t]he claimant’s
unemployment is not due to the fact . . . that he was discharged for misconduct in connection
with his employment.” I.C. § 72-1366(5). Employment-related misconduct includes any of the
following: “(1) a willful, intentional disregard of the employer’s interest; (2) a deliberate
violation of the employer’s reasonable rules; or (3) a disregard of a standard of behavior which
the employer has a right to expect of his employees.” Kivalu v. Life Care Centers of America,
142 Idaho 262, 264, 127 P.3d 165, 167 (2005); IDAPA 09.01.30.275.02. “The burden of proving
misconduct by a preponderance of the evidence falls strictly on the employer, and where the
burden is not met, benefits must be awarded to the claimant.” Harris, 141 Idaho at 3, 105 P.3d at
269; IDAPA 09.01.30.275.01.
The Commission must consider all three grounds when determining whether an
employee’s termination was a result of employment-related misconduct. Smith v. Zero Defects,
Inc., 132 Idaho 881, 884, 980 P.2d 545, 548 (1999). The focus of the inquiry is not whether the
employer’s reason for discharge was reasonable but, rather, whether the misconduct was work-
related so as to make the employee ineligible for unemployment benefits. Beaty v. City of Idaho
Falls, 110 Idaho 891, 892, 719 P.2d 1151, 1152 (1986). Whether an employee’s behavior
constitutes misconduct is a factual determination that will be upheld if supported by substantial
and competent evidence. Harris, 141 Idaho at 3, 105 P.3d at 269.
In this case, the Commission considered all three grounds for misconduct, but determined
that the issue could be disposed of under the standard of behavior test and, thus, based its
decision solely on the ground that Adams’ failure to report to work as expected on the afternoon
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of November 3, without contacting his employer, fell below the reasonable standard of behavior
an employer is entitled to expect.
Under the standard of behavior test, the employer must prove, by a preponderance of the
evidence, that (1) the employee’s conduct fell below the standard of behavior expected by the
employer; and (2) the employer’s expectations were objectively reasonable under the
circumstances. Harris, 141 Idaho at 4, 105 P.3d at 270; IDAPA 09.01.30.275.02(c). Generally,
an employer’s burden of proof under the standard of behavior test does not require a showing
that the employee’s conduct was willful, intentional, or deliberate. Harris, 141 Idaho at 4, 105
P.3d at 270. The first prong of the test addresses only what the employer subjectively expected
from the employee, while the second prong considers whether the employer’s expectations are
reasonable. The record establishes that Aspen subjectively expected Adams to provide
notification prior to taking three hours off to run a personal errand. Therefore, the only issue for
this Court to determine is whether the Commission’s conclusion that Aspen’s expectation was
objectively reasonable under the circumstances is supported by substantial and competent
evidence.
In order for an employer’s expectation to be objectively reasonable, the expectation must
be communicated to the employee, unless the expectation is the type that flows naturally from
the employment relationship. Id. An expectation flows naturally from the employment
relationship when the expectations are common among employees in general or within a
particular enterprise. Appeals Examiner of Idaho Dep’t of Labor v. J.R. Simplot Co., 131 Idaho
318, 322, 955 P.2d 1097, 1101 (1998). Such expectations are generally limited to fundamental
expectations and do not involve specific rules unless clearly embodied in the job at issue. See,
e.g., Pimley v. Best Values, Inc., 132 Idaho 432, 435, 974 P.2d 78, 81 (1999) (holding that a
retail employer has a reasonable expectation flowing naturally from the employment relationship
that its employees will not make vulgar comments about coworkers and supervisors in the
presence of customers and other coworkers); Bullard v. Sun Valley Aviation, Inc., 128 Idaho 430,
434, 914 P.2d 564, 568 (1996) (finding that an employer’s expectation that an employee will
comply with federal rules and the employer’s manual, which both required permission prior to
crossing a runway, flowed naturally from a line service position at an airport). In other words,
the relevant question is whether the employee has breached “a standard of behavior that would
flow normally from an employment relationship or which was communicated to [the employee]
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because of its uncommon nature.” Wulff v. Sun Valley Co., 127 Idaho 71, 75, 896 P.2d 979, 983
(1995).
In this case, the Commission found that, while the record did not establish Aspen had
ever communicated to Adams its expectation that he seek permission before taking an extended
absence, an employer has a reasonable expectation an employee will “show up for work and stay
at work,” and such an expectation flows naturally from the employment relationship. The
Commission, in its written Decision and Order, stated:
It may be true that the Employer was in financial distress and that the
business was able to continue functioning with two installers rather than three 3
after discharging Claimant. It also may be that Mr. Sidwell was not pleased that
Claimant filed a worker’s compensation claim. However, these conditions do not
excuse Claimant from leaving work in the middle of the day without permission
or other communication. Employers have a reasonable expectation that their
employees will work the hours that they are scheduled. That expectation in this
case did not “vanish” because Employer may have been having financial
problems.
Claimant’s failure to report for work as expected without contacting his
supervisor, regardless of the reason for his absence, fell below the reasonable
standard Employer was entitled to expect. That behavior resulted in Claimant’s
discharge. Therefore, we conclude that Employer discharged Claimant for
employment-related misconduct.
The Commission correctly concluded that the expectation employees will work the hours
they are scheduled to work is the type of expectation that flows naturally from the employment
relationship. Expecting an employee to come to work, and stay at work, during scheduled hours
is a fundamental expectation shared by employers in every field of work. However, an
employer’s expectation, even if it flows naturally from the employment relationship, is not
objectively reasonable if it is contrary to an established course of conduct. Davis v. Howard O.
Miller Co., 107 Idaho 1092, 1095, 695 P.2d 1231, 1234 (1984). For example, in Davis, a gas
station manager was terminated, in part, for temporarily leaving work without notifying his
employer. Id. at 1094, 695 P.2d at 1233. Prior to his termination, the manager had occasionally
left work for one to two hours per week after first arranging for another employee to take his
place. Id. at 1093, 695 P.2d at 1232. It was common for managers, including those who worked
at other local gas stations owned by the employer, to leave during their scheduled shifts without
3
As Adams correctly points out in briefing, the Commission mistakenly asserts that Aspen went from three
installers to two installers after Adams was terminated. The record is clear that Aspen actually went from two
installers to one installer after Adams was terminated.
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notifying the employer. Id. This type of temporary absence was generally tolerated as long as the
manager arranged for another employee to cover the absence. Id. This Court found that the
manager’s act of temporarily leaving work without notification did not fall below a reasonable
expectation of employee behavior because the employer had tolerated such absences for several
months, had failed to express to the employee any disapproval with regard to such conduct, and
had not informed the employee that his conduct was not acceptable. Id. at 1095, 695 P.2d at
1234.
This Court conducted a similar analysis in Folks v. Moscow School District No. 281, 129
Idaho 833, 838, 933 P.2d 642, 647 (1997). In Folks, a teacher was terminated for an outburst of
profanity directed at the school principal. Id. at 835, 933 P.2d at 644. Over the course of two or
three years prior to the incident, the teacher and the principal had engaged in a pattern of
communication that often included the use of profanity by the teacher. Id. at 835, 839, 933 P.2d
at 644, 648. Additionally, the principal and the teacher had previously been teaching colleagues
at the same school and had developed an informal relationship in which they both engaged in the
use of profanity. Id. at 835, 933 P.2d at 644. This Court upheld the Commission’s finding that an
expectation contrary to the established course of conduct was not objectively reasonable and,
therefore, the teacher’s termination was not a result of employment-related misconduct. Id. at
838, 933 P.2d at 647. The Court emphasized that through his acquiescence, the principal had led
the teacher to believe that her conduct was acceptable and was not inappropriate or
unprofessional. Id.
In this case, the Commission found that Aspen “expected installers to get permission
before taking extended absences during the day, but not necessarily for short errands, such as
trips to the bank.” While there is conflicting evidence in the record regarding whether installers
were required to give notice even for short errands, the Commission made a specific finding that
such errands were allowed without notice to Aspen. This finding is supported by Adams’
testimony that installers at Aspen, including himself, were consistently allowed to run short
errands without notifying Aspen, and that such a practice had never been a problem in the past.
Thus, it appears that, like in Folks and Davis, Aspen led its installers to believe that running short
personal errands at work was an acceptable practice despite the break policy in the employee
handbook stating otherwise. However, the crux of the Commission’s decision was that Adams’
personal errand on November 3 was much different than the short personal errands previously
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allowed by Aspen. To support its position, the Commission pointed out that Adams conceded
that he had never taken off three hours in one day without notifying Aspen. The Commission
also pointed out that Adams did more than just take the afternoon off for personal business,
because from 10:15 a.m. to 12:25 p.m., Adams was on his lunch break and visiting the DMV for
the first time during work hours.
There is substantial and competent evidence in the record to support the Commission’s
conclusion that Adams’ absence on November 3 was an extended absence that required prior
notification, rather than a short errand that required no notice. Most importantly, the
Commission’s finding is fully supported by Adams’ own testimony before the Appeals
Examiner, where he conceded that he had never previously taken three hours off in one day and
that such a practice was unprecedented rather than common practice. Although Adams intended
for his trip to the DMV to be the type of short personal errand that Aspen permitted without
notice, it ultimately turned into an errand that took the greater part of an afternoon. Adams
testified that he left the DMV the first time because the line to renew his license was too long,
which indicates he thought it was inappropriate, at that time, to wait in such a long line instead of
returning to work. Once Adams realized, during his second visit, that the line at the DMV had
not diminished, he could have opted to once again return to work, especially given his
knowledge that he had not previously been allowed to take several hours off in one day without
notifying Aspen. Furthermore, as the Commission pointed out, Adams spent very few hours
working on November 3 as a result of his two trips to the DMV and his early lunch break, which
does not seem to be in accord with the course of conduct that Aspen had previously allowed.
Therefore, this case is categorically different than Folks and Davis because the conduct for which
Adams was terminated was not the type of conduct previously authorized by the employer.
Adams correctly asserts in briefing that the Commission failed to address the telephone
conversation that occurred between Sidwell and Adams at around 3:00 p.m. while Adams was at
the DMV, wherein Sidwell was informed of Adams’ whereabouts. Although it is true that Aspen
eventually learned Adams was at the DMV, Sidwell testified that Aspen lost money that
afternoon because Adams was unable to complete any customer-service jobs as a result of his
trip to the DMV. Additionally, in a letter to the Commission, admitted as an exhibit at the
hearing, Melissa Miller, the general manager of Aspen, explained that she wanted to send Adams
on a job that afternoon, but she did not know where Adams was or when he had left work. If
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Aspen had been notified in advance that Adams intended to take the entire afternoon off, perhaps
it could have made other arrangements for any service call that needed to be made. However, the
evidence indicates that because of Adams’ failure to notify Aspen, his extended trip to the DMV
interfered with his work-related responsibilities that afternoon, which is also not in accord with
the course of conduct previously allowed by Aspen. Thus, there is substantial and competent
evidence to support the Commission’s conclusion that Adams’ conduct fell below a reasonable
standard of behavior that Aspen was entitled to expect.
Adams also argues that regardless of whether Aspen’s expectations were objectively
reasonable, he was terminated as a result of Aspen’s financial problems, and not his own
misconduct. Adams relies on this Court’s decision in Davis to support his argument. In Davis,
the employer asserted that one of the reasons the employee was terminated was because he did
not honestly fill out his employment application by failing to list a prior job that had lasted only
three to four days. 107 Idaho at 1096, 695 P.2d at 1235. However, the Commission found that
the employee was not terminated because of his dishonesty on the application but, rather,
because the employer had learned that the employee had interviewed for another job and feared
the employee would quit his job without notice. Id. at 1094, 695 P.2d at 1233. According to the
Commission, the employer had discovered that the employee had quit a previous job, the one he
had failed to mention on his application, without providing notice, and the employer feared he
would do the same thing if he obtained a different job. Id. This Court agreed with the
Commission’s conclusion, pointing out that the employer had specifically testified that the
employee
just quit [his previous job] like that. And so when he started being absent a lot
and then when I called him that day to see where he was the previous day and he
said he had a job interview. That did it as far as we were concerned, we could
not take a chance on having him quit us without notice.
Id. at 1096, 695 P.2d at 1235 (emphasis in original). For these reasons, the Court found
substantial and competent evidence in the record to support the Commission’s finding that the
employee was not terminated for misconduct. Id.
While the holding in Davis does establish that an employee should not be denied
unemployment benefits when he or she is terminated for reasons other than misconduct, the facts
in Davis are distinguishable from the facts in this case in two important ways. First, in Davis,
there was an explicit statement by the employer that indicated he was motivated to terminate the
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employee for reasons other than the employee’s alleged misconduct. In this case, Aspen
specifically denied any allegation that Adams was terminated for any reason other than the fact
that he had left work for a prolonged personal errand without first notifying Aspen. Second, the
Commission in Davis specifically made a finding of fact that the employer terminated the
employee for reasons other than misconduct. In this case, the Commission found Adams was
terminated for misconduct. Although it is true that Aspen did not fill Adams’ position as an
installer after he was terminated, which tends to support Adams’ argument that he was
terminated for financial reasons, without a finding by the Commission that Aspen actually had
alternative motives for the termination, this Court cannot make such a finding. Because there is
substantial and competent evidence in the record to support the Commission’s finding of
misconduct, Adams’ argument that Aspen had alternative motives for terminating him fails.
Lastly, Adams argues that it was unreasonable for Aspen to terminate him without a prior
warning, given the progressive disciplinary procedure denoted in the employee handbook.
However, this Court has previously found that the issue of whether an employer should have
chosen a different form of discipline from its hierarchy of disciplinary measures is wholly
irrelevant when considering whether an employee’s actions constitute employment-related
misconduct. Alder v. Mountain States Telephone & Telegraph Co., 92 Idaho 506, 512, 446 P.2d
628, 634 (1968). In Alder, this Court rejected the employees’ argument that the employer had a
duty to warn them that their behavior could result in termination, and specifically noted that:
[such an argument] is irrelevant to the only issue decided by the Industrial
Accident Board below and by this decision, namely, whether appellants were
discharged for misconduct. Substantively, however, the argument is faulty
because it is wholly within the employer’s discretion to mete out various forms of
discipline for misconduct. This Court has no legal basis upon which it could
interfere with the internal disciplinary matters of an employer once employee
misconduct has been found.
Id. 4 Consequently, Adams’ argument is not relevant to the issue of whether his actions on
November 3 amounted to employment-related misconduct.
4
It should be noted that the employees in Alder were making a general argument, based on fairness and equity, that
the employer had a duty to warn them that their conduct could lead to termination. This is distinguishable from the
case at hand because Aspen has a specific progressive disciplinary policy. However, the issue of what disciplinary
measures should have been taken, assuming employee misconduct, is an issue separate and distinct from the issue of
whether an employee’s actions constitute misconduct.
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IV.
Conclusion
While this is not a clear-cut case, and Adams has advanced several persuasive arguments
in support of his position, this Court does not reweigh evidence or consider whether it would
have reached a different conclusion on the matter. There is substantial and competent evidence to
support the Commission’s determination that Adams was terminated for employment-related
misconduct. Therefore, we affirm the Commission’s decision to deny Adams unemployment
benefits.
Chief Justice EISMANN, and Justices W. JONES and HORTON CONCUR.
Justice BURDICK dissenting without opinion.
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