IN THE SUPREME COURT FOR THE STATE OF NORTH DAKOTA
SUPREME COURT DOCKET NO. 20080341
| Crystal Schweitzer, |
| Petitioner and Appellant, |
| v. |
| Job Service North Dakota, |
| Respondent and Appellee, |
| and |
| LM Glasfiber (ND) Inc., |
| Respondent. |
APPEAL FROM ORDER OF NORTHEAST CENTRAL JUDICIAL
DISTRICT AFFIRMING JOB SERVICE NORTH DAKOTA DECISION
BRIEF OF APPELLANT
CRYSTAL SCHWEITZER
| CLINICAL EDUCATION PROGRAM |
| Megan Jahner |
| Arin Ridl |
| Meredith Vukelic |
| Diane Wehrman |
| Certified Student Attorneys |
| Margaret Moore Jackson, ND ID# 05655 |
| Daniel Schaffzin, ND ID #06410 |
| University of North Dakota |
| Clinical Education Program |
| 215 Centennial Drive Stop 9003 |
| Grand Forks, ND 58202-9003 |
| (701) 777-2932 FAX: (701) 777-6301 |
| Attorneys for Appellant |
| Crystal Schweitzer |
| TABLE OF CONTENTS |
| TABLE OF CONTENTS i |
| TABLE OF AUTHORITIES iii |
| ISSUES PRESENTED 1 |
| STATEMENT OF THE CASE 2 |
| STATEMENT OF THE FACTS 4 |
| STANDARD OF REVIEW 8 |
| ARGUMENT 11 |
| I. The Agency's Findings of Fact Do Not Sustain Its Conclusion of Law |
| That Crystal Schweitzer Engaged in Disqualifying Misconduct |
| Supporting Denial of Unemployment Benefits 11 |
| A. Ms. Schweitzer's Phone Call, an Isolated Incident, Did Not Harm |
| or Negatively Impact an Important Interest Proffered by LM or |
| Violate an Explicit LM Policy 13 |
| 1. LM Failed to Demonstrate That Ms. Schweitzer's Conduct |
| Implicated, Threatened, or Actually Harmed an Important |
| Employer Interest 13 |
| 2. Ms. Schweitzer's Phone Call Did Not Violate an |
| Explicit LM Policy 15 |
| B. Ms. Schweitzer's Isolated Phone Call Did Not Rise to the Level |
| of Disqualifying Misconduct as Defined by This Court 16 |
| 1. Ms. Schweitzer's Phone Call Was Not Made in Willful or |
| Wanton Disregard of LM's Interest 17 |
| 2. Ms. Schweitzer's Phone Call Was Not so Careless or |
| Negligent as to Amount to a Willful or Wanton Disregard of |
| LM's Interest 22 |
| 3. Ms. Schweitzer's Phone Call Was Not Made With Wrongful |
| Intent or Evil Design 23 |
| 4. In Making the Phone Call, Ms. Schweitzer Did Not |
| Intentionally Nor Substantially Disregard LM's Interest or |
| Her Own Duties 24 |
| II. Crystal Schweitzer was Denied a Fair Hearing Because the Appeals Referee Abused His Discretion by Failing to Admit and Consider All Evidence in a Fair and Impartial Manner 27 |
| CONCLUSION 31 |
| TABLE OF AUTHORITIESNORTH DAKOTA SUPREME COURT |
| Barnett v. North Dakota Dep't of Human Servs., 551 N.W.2d 557 (N.D. 1996) 28 |
| Blueshield v. Job Service North Dakota, 392 N.W.2d 70 (N.D. 1986) 18, 19 |
| Carlson v. Job Service North Dakota, 548 N.W.2d 389 (N.D. 1996) 8 |
| Christofferson v. North Dakota Dep't of Health, 2007 ND 199, 742 N.W.2d 799 8 |
| Esselman v. Job Service North Dakota, 548 N.W.2d 400 (N.D. 1996) 28 |
| First Am. Bank & Trust Co. v. Ellwein, 221 N.W.2d 509 (N.D. 1974) 27, 28 |
| Froysland v. North Dakota Workers Comp. Bureau, 432 N.W.2d 883 (N.D. 1988) 27 |
| Hendrickson v. Olson, 2009 ND 16 8 |
| Hins v. Lucas Western, 484 N.W.2d 491 (N.D. 1992) 14, 17 |
| Holiday Inn v. Karch, 514 N.W.2d 374 (N.D. 1994) 13, 14, 15 |
| Hulse v. Job Service North Dakota, 492 N.W.2d 604 (N.D. 1992) 9, 10, 12, 14, 21, 22 |
| In re Township 143 North, Range 55 West, Cass County, 183 N.W.2d 520 (N.D. 1971) 27 |
| Johnson v. Job Service North Dakota, 1999 ND 42, 590 N.W.2d 877 12, 13, 17 |
| Lewis v. North Dakota Workers Comp. Bureau, 2000 ND 77, 609 N.W.2d 445 28 |
| Lord v. Job Service North Dakota, 343 N.W.2d 92 (N.D. 1984) 9 |
| Marion v. Job Service North Dakota, 470 N.W.2d 609 (N.D. 1992) 8, 9, 10, 23 |
| May v. Sprynczynatyk, 2005 N.D. 76, 695 N.W.2d 196 30 |
| Medcenter One, Inc. v. Job Service North Dakota, 410 N.W.2d 521 (N.D. 1987) 24, 25, 26 |
| Newland v. Job Service North Dakota, 460 N.W.2d 118 (N.D. 1990) 10, 11 |
| Perske v. Job Service North Dakota, 336 N.W.2d 146 (N.D. 1983) 11, 12, 13, 16, 17, 22 |
| ProServe Corp. v. Rainey, 536 N.W.2d 373 (N.D. 1995) 9, 16, 18 |
| Roberts v. North Dakota Workmen's Comp. Bureau, 326 N.W.2d 702 (N.D. 1982) 8 |
| Schadler v. Job Service North Dakota, 361 N.W.2d 254 (N.D. 1985) 9, 11, 14, 19, 27, 30 |
| Schultz v. North Dakota Dep't of Human Servs., 372 N.W.2d 888 (N.D. 1985) 29 |
| Skjefte v. Job Service North Dakota, 392 N.W.2d 815 (N.D. 1986) 25, 26 |
| Spectrum Care LLC v. Stevick, 2006 ND 155, 718 N.W.2d 593 8, 20, 21 |
| Stalcup v. Job Service North Dakota, 1999 ND 67, 592 N.W.2d 549 17, 18, 28, 29 |
| Steele v. Job Service North Dakota, 445 N.W.2d 635 (N.D. 1989) 11, 21 |
| Tehven v. Job Service North Dakota, 488 N.W.2d 48 (N.D. 1992) 14, 15 |
| OTHER JURISDICTIONS |
| Boynton Cab Co. v. Neubeck,296 N.W. 636 (Wis. 1941) 12, 16 |
| STATUTES |
| N.D.C.C. § 28-32-19 9 |
| N.D.C.C. § 28-32-31 27 |
| N.D.C.C. § 28-32-46 8 |
| N.D.C.C. § 52-01-05 10, 11 |
| N.D.C.C. § 52-06-02 11, 12 |
| N.D.C.C. § 52-06-20 28 |
| N.D.C.C. § 52-06-23 27, 29 |
| CODES |
| N.D. Admin. Code 27-03-06-03 28 |
ISSUES PRESENTED
I. Whether an employee who makes a single telephone call to the temporary staffing company used by her employer and recommends a relative for hiring has committed misconduct sufficient to disqualify the employee from receiving unemployment benefits.
II. Whether the refusal of an administrative referee to review or accept evidence relied upon by the claimant, without any explanation, deprives the claimant of a fair hearing.
STATEMENT OF THE CASE
Crystal Schweitzer appeals the District Court's October 22, 2008 Order affirming the decision of Job Service North Dakota to deny her unemployment benefits.
Crystal Schweitzer filed a claim for unemployment compensation benefits with Job Service North Dakota on January 24, 2008. (Record (hereinafter, "R.") at 1.) When her claim was denied pursuant to the "Nonmonetary Determination Notice" dated February 14, 2008, Ms. Schweitzer submitted her Job Service North Dakota Request for Lower Authority Appeal on February 21, 2008. (R. at 21, 25.)
On February 26, 2008, Ms. Schweitzer received a Notice of Telephone Hearing relating to her appeal for Job Insurance Benefits. (R. at 28.) The Notice identified a single issue to be addressed: "Whether the claimant voluntarily left employment without good cause attributable to the employer or was discharged for misconduct connected with the work." (R. at 28.) The telephone hearing was conducted on March 4, 2008. (R. at 47.)
Following the hearing, the Appeals Referee affirmed the February 14, 2008 decision denying Ms. Schweitzer unemployment benefits. (R. at 133.) Although Ms. Schweitzer attempted to appeal the Appeals Referee decision by submitting additional documentation supporting her position on March 18, 2008, the Appeals Bureau declined to review the Referee's decision. (R. at 180, 183.) In its March 24, 2008 letter, the Appeals Bureau stated, "The Appeals Referee decision is deemed to be a decision of the Bureau for the purposes of judicial review " (R. at 183.)
Ms. Schweitzer then filed and served a Petition for Judicial Review on April 22, 2008, with the Northeast Central Judicial District. (R. at 184.) After submission of the Certificate of Record to the Court and briefing on the issues, the District Court, the Honorable Karen K. Braaten presiding, issued its Memorandum Decision and Order Affirming Job Service Decision on October 14, 2008. On October 24, 2008, Ms. Schweitzer was served with Notice of Entry of Judgment, Order for Judgment and Judgment indicating that the District Court had affirmed the Job Service North Dakota decision denying her unemployment insurance benefits. Ms. Schweitzer timely filed and served her Notice of Appeal with the North Dakota Supreme Court on December 19, 2008.
STATEMENT OF FACTS
Crystal Schweitzer began working for LM Glasfiber ND, Inc. (hereinafter "LM") on a temporary basis in or around October 2004. (R. at 65.) She transitioned to full-time employment with LM around February 2005. (Id.) Ms. Schweitzer was employed as a Facilities Associate and was responsible for performing routine janitorial duties. (R. at 131.) She was a good worker. (R. at 3.) She never once violated a company/union policy or rule, and had only received one warning during her employment at LM regarding an issue unrelated to her termination. (R. at 3.)
In September 2007, after Ms. Schweitzer had worked at LM for nearly three years, Pam Hune (hereinafter "Ms. Hune"), a Production Manager assigned to the same shift as Ms. Schweitzer, conducted an informal meeting attended by temporary workers from Express Personnel Services (hereinafter "Express") and Ms. Schweitzer. (R. at 95.) Express is the temporary staffing agency often used by LM. (R. at 131.) LM employed a permanent staff that was hired through LM's human resources department, as well as a temporary staff that was hired through staffing agencies, typically Express. (R. at 57, 63.)
During the meeting, Ms. Hune discussed having Ms. Schweitzer provide direction to the temporary employees from Express. (R. at 95.) Specifically, Ms. Hune let the temporary workers know that Ms. Schweitzer was the lead and that they were to follow what Ms. Schweitzer said. (R. at 95, 109.) Beyond simply helping the temporary workers, Ms. Schweitzer directed the temporary staff regarding where they should perform their cleaning duties and when to take breaks. (R. at 95, 131.) Following the informal meeting, Ms. Schweitzer discussed Ms. Hune's assignment of Ms. Schweitzer as an unofficial lead with Gerald Muizelaar (hereinafter "Mr. Muizelaar"), Ms. Schweitzer's immediate supervisor. (R. at 73, 75.) Mr. Muizelaar was aware of the unofficial assignment of lead to Ms. Schweitzer. (R. at 71.)
On December 14, 2007, Ms. Schweitzer made a phone call to Alysa Haugen (hereinafter "Ms. Haugen"), a Staffing Coordinator employed by Express, to inquire about the possibility of Ms. Schweitzer's brother being considered for a vacancy within her department. (R. at 131.) Ms. Schweitzer identified herself and referred to herself as a "lead" within the janitorial staff at LM. (R. at 99.) The purpose of this phone call was to recommend Ms. Schweitzer's brother, Jodi Schweitzer, for a position that Ms. Schweitzer believed was available. (R. at 131.) Ms. Schweitzer made the call to help her brother, but also because she believed that her brother would be a good worker. (R. at 100.) This single phone call was made on a Friday, when Ms. Schweitzer was off-duty and not at work. (R. at 95.) LM eventually identified this isolated incident as the sole reason for Ms. Schweitzer's termination. (R. at 56.)
On December 17, 2007, Rick Sandwick (hereinafter "Mr. Sandwick"), an LM human resources department employee, learned about the phone call through an e-mail communication he received from Ms. Haugen. (R. at 140.) The e-mail stated that Ms. Schweitzer had referred to herself as a "supervisor" and that Ms. Schweitzer was interested in getting her brother a job through Express Personnel's process. (R. at 131.) The e-mail stated further that Ms. Haugen had concluded her single phone conversation with Ms. Schweitzer by explaining that she usually dealt with Mr. Sandwick for matters relating to LM and was unaware of any open position at LM. (R. at 140.) Mr. Sandwick then showed Ms. Haugen's e-mail message to Dan Gordon (hereinafter "Mr. Gordon"), an LM human resources manager. (R. at 64.) Mr. Gordon contacted Ms. Schweitzer to set up a meeting to discuss Ms. Haugen's e-mail message. (R. at 144.) The meeting was scheduled for January 14, 2008. (R. at 76.) However, due to LM's conflicts, the meeting was canceled. (R. at 132.) On January 18, 2008, Mr. Gordon sent a letter to Ms. Schweitzer informing her that her employment with LM had been terminated after an internal review of the matter of Ms. Schweitzer's phone call with Express. (R. at 139.)On January 24, 2008, Ms. Schweitzer filed a claim for unemployment compensation benefits with Job Service North Dakota (hereinafter "Job Service"). (R. at 1.) Job Service ultimately denied Ms. Schweitzer's claim, citing disqualifying misconduct as the reason for its "Nonmonetary Determination." (R. at 21.) Ms. Schweitzer went through the proper process for appealing that decision. (R. at 129.) An administrative hearing on Ms. Schweitzer's claim was scheduled for March 4, 2008. (R. at 28.) During this telephone hearing, Ms. Schweitzer attempted to submit audio tapes into evidence. (R. at 111.) The Appeals Referee refused to accept the tapes into evidence without explanation and without even listening to them. (Id.) Ms. Schweitzer referenced conversations contained on the refused tape recordings throughout her cross-examination of LM representatives Gerald Muizelaar and Dan Gordon. (R. at 72-73, 80, 98.)LM presented no evidence at the hearing that Ms. Schweitzer's phone call threatened to harm its business operation. (R. at 46-112.) LM acknowledged that it did not have a policy prohibiting LM employees from contacting temporary staffing agencies who contract with LM. (R. at 141-43.) LM proffered no evidence that Ms. Schweitzer acted with malice or in an effort to harm LM. (R. 46-112.) In fact, LM admitted that Ms. Schweitzer might have believed there was a job opening at the time of her phone call. (R. at 71.) LM claimed that the call was misleading because Ms. Schweitzer was not a supervisor and was not empowered to contact Express on its behalf. (R. at 70.) However, Ms. Schweitzer contended that the purpose of her phone call was merely to refer her brother, Jodi Schweitzer. (R. at 99-100.) There is no testimony or evidence in the record to suggest that the call was an attempt by Ms. Schweitzer to circumvent the LM or Express staffing policies or otherwise to harm LM in any fashion. (R. at 99-100, 155.)The Appeals Referee's written decision found that the single phone call Ms. Schweitzer made to Express constituted disqualifying misconduct sufficient to deprive her of unemployment benefits. (R. at 132.) Despite his decision, the Referee acknowledged that Ms. Schweitzer believed what she was saying during the call to be true. (R. at 131.) The Referee did not find that Ms. Schweitzer harbored any malice or ill intent toward LM in making the phone call. (R. at 131-33.) Further, the Referee did not identify any potential detriment that had been caused to LM by the phone call. (Id.)
STANDARD OF REVIEW
>In an appeal of the final decision of an administrative agency, the Supreme Court reviews the decision of the agency, not the decision of the district court. Carlson v. Job Service North Dakota, 548 N.W.2d 389, 392 (N.D. 1996). While it will afford the agency some deference, the Court has clarified that it will reverse an administrative decision where:
(1) the order is not in accordance with the law; (2) the order is in violation of the constitutional rights of the appellant; (3) the provisions of N.D.C.C. 28-32 have not been complied with in the proceedings before the agency; (4) the rules or procedure of the agency have not afforded the appellant a fair hearing; (5) the findings of fact made by the agency are not supported by a preponderance of the evidence; (6) the conclusions of law and order of the agency are not supported by its findings of fact; (7) the findings of fact made by the agency do not sufficiently address the evidence presented to the agency by appellant; or (8) the conclusions of law and order of the agency do not sufficiently explain the rationale for not adopting any contrary recommendations by a hearing officer or an administrative law judge.
Hendrickson v. Olson, 2009 ND 16, ¶ 8 (citing N.D.C.C. § 28-32-46; Christofferson v. North Dakota Dep't of Health, 2007 ND 199, ¶ 7, 742 N.W.2d 799). See also Spectrum Care LLC v. Stevick, 2006 ND 155, ¶ 11-13, 718 N.W.2d 593 (stating same definition).
The Court is not charged with making independent findings of fact, but rather with evaluating "whether a reasoning mind reasonably could have determined that the factual conclusions reached by the agency were proved by the weight of the evidence from the entire record." Marion v. Job Service North Dakota, 470 N.W.2d 609, 611 (N.D. 1992). See also Roberts v. North Dakota Workmen's Comp. Bureau, 326 N.W.2d 702, 706 (N.D. 1982) (holding that an administrative agency is bound to consider the entire record and not just those reports and findings that support its decision).
A determination of whether an employee's conduct is such to disqualify the employee from receiving unemployment compensation benefits "depends in part on the nature of the work and presents a mixed question of law and fact." ProServe Corp. v. Rainey, 536 N.W.2d 373, 376 (N.D. 1995). At the administrative level, the employer bears the burden of proving "by a preponderance of the evidence that the employee's acts constitute misconduct which results in a disqualification of benefits." Schadler v. Job Service North Dakota, 361 N.W.2d 254, 257 (N.D. 1985) (citing N.D.C.C. § 28-32-19; Lord v. Job Service North Dakota, 343 N.W.2d 92, 94 (N.D.1984)).
On appeal, the Supreme Court's duty is not to summarily affirm the administrative agency decision, but with regard to the mixed question of fact and law described in Rainey, to inquire "whether the evidence supports the agency's findings of fact and, in turn, whether those findings of fact sustain the agency's conclusion regarding misconduct." Hulse v. Job Service North Dakota, 492 N.W.2d 604, 606 (N.D. 1992). Where the agency's conclusion of law regarding misconduct is based on undisputed facts, and contradictory inferences cannot reasonably be drawn from the undisputed facts, the standard of review is de novo. Marion, 470 N.W.2d at 611-12. Alternatively, when the facts are in dispute the court applies a deferential standard of review to the findings of fact to determine whether a reasoning mind could have determined that the factual conclusions were proved by the weight of the evidence. Id. at 612.
From the administrative record, it is undisputed (1) that on or about December 14, 2007, Crystal Schweitzer placed a phone call to Express (R. at 131.); and (2) that on January 18, 2008, following an internal review focused solely on this phone call, Crystal Schweitzer was discharged from her employment. (R. at 132.) The disputed fact, whether Ms. Schweitzer used the word "supervisor" or "lead" when identifying herself to the Express employee during the phone call in question, is immaterial to the determination of whether Crystal Schweitzer's conduct rises to the level of disqualifying misconduct, such that Job Service reasonably denied Ms. Schweitzer unemployment benefits. Therefore, the Court should review the administrative agency's final decision denying Ms. Schweitzer benefits de novo. Marion, 470 N.W.2d at 612.
LM did not establish by a preponderance of the evidence that the phone call placed by Ms. Schweitzer constitutes misconduct because there was no evidence that the phone call was against LM's interest, or otherwise satisfied the stringent test for disqualifying misconduct in the unemployment benefits context. As is further explained below, a review of the record demonstrates that Job Service's findings of fact in this case do not sustain the agency's conclusion of law that Ms. Schweitzer committed disqualifying misconduct. See Hulse, 492 N.W.2d at 606.
In addition to the legal standard of review, this Court should also consider the policy underscoring North Dakota's unemployment insurance system when reviewing this decision. Unemployment insurance was created in order to minimize the hardship on the unemployed worker and the unemployed worker's family. N.D.C.C. § 52-01-05. The Legislature intended to soften the harsh impact of involuntary unemployment by providing a weekly unemployment benefit to those employees not disqualified by statute. Newland v. Job Service North Dakota, 460 N.W.2d 118, 121 (N.D. 1990). The Legislature further intended unemployment compensation as one means of honoring the balance between the interests of the unemployed worker and the interest of the employer. N.D.C.C. § 52-01-05; Newland, 460 N.W.2d at 121. Such compensation protects the employer from "quits that have nothing to do with the employer or the employment" and dismissals based upon employee "misconduct," while shielding the employee from involuntary unemployment. N.D.C.C. § 52-01-05. When evaluating these interests against one another, however, this Court has recognized that because unemployment compensation laws are remedial legislation, the balance should be struck in favor of the employee. Newland, 460 N.W.2d at 121.
ARGUMENT
I. The Agency's Findings of Fact Do Not Sustain Its Conclusion of Law That Crystal Schweitzer Engaged in Disqualifying Misconduct Supporting Denial of Unemployment Benefits.
Job Service North Dakota incorrectly denied Ms. Schweitzer unemployment benefits because it wrongly concluded that the single phone call that caused her termination constituted misconduct under N.D.C.C. § 52-06-02(2). N.D.C.C. § 52-06-02(2). This Court has recognized that "[m]isconduct which may justify discharge may not always justify a denial of benefits under our unemployment compensation laws." Steele v. Job Service North Dakota, 445 N.W.2d 635, 642 (N.D. 1989) (citing Schadler, 361 N.W.2d at 256). Here, the question is not whether LM acted with cause in discharging Ms. Schweitzer on the basis of a single, improper phone call, but rather whether or not Job Service was justified in denying Ms. Schweitzer benefits based solely on this one, isolated incident. See e.g., Perske v. Job Service North Dakota, 336 N.W.2d 146, 148 (N.D. 1983).
Although the North Dakota Unemployment Compensation Statutes do not define
the term "misconduct," this Court has adopted a definition of that term first enunciated by the Wisconsin Supreme Court in 1941:
[Misconduct] is limited to conduct evincing such willful or wanton disregard of an employer's interest as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect of his employee, or in carelessness or negligence of such degree or recurrence as to manifest equal culpability, wrongful intent or evil design, or to show an intentional and substantial disregard of the employer's interest or of the employee's duties and obligations to his employer.
Perske, 336 N.W.2d at 148 (citing Boynton Cab Co. v. Neubeck, 296 N.W. 636 (Wis. 1941)). See also Johnson v. Job Service North Dakota, 1999 ND 42, ¶ 11, 590 N.W.2d 877 (restating same definition). As with the construction of unemployment statutes generally, the Court will construe misconduct narrowly and in the light most favorable to the unemployed individual. Johnson, 1999 ND 42, ¶ 10, 590 N.W.2d 877. In other words "an employee should be disqualified for misconduct only when the facts and circumstances of a case come within the clear meaning of the words used in the provisions of N.D.C.C. § 52-06-02 and within the clear meaning of the language contained in our definition of misconduct." Id. at ¶ 10.
The issue of whether employee conduct constitutes misconduct is a mixed question of fact and law. Hulse, 492 N.W.2d at 606 (explaining that "the evidence must support its findings of fact which, in turn, must sustain its conclusion regarding misconduct"). In Hulse, the Court held that absent evidence of culpability rising to one of the rigorous levels of behavior contemplated by the accepted definition, one episode of poor judgment does not constitute misconduct. Id. at 608. The conduct that resulted in Ms. Schweitzer's termination and denial of unemployment benefits was an isolated incident demonstrating merely a good faith error in judgment. But for her single phone call to a representative of Express, Ms. Schweitzer would not have been terminated by LM. (R. at 56.)
A. Ms. Schweitzer's Phone Call, an Isolated Incident, Did Not Harm or Negatively Impact an Important Interest Proffered by LM or Violate an Explicit LM Policy.
"For an isolated incident to be disqualifying conduct under unemployment compensation statute, the incident must violate an 'important employer interest or explicit policy.'" Johnson, 1999 ND 42, ¶ 13, 590 N.W.2d 877 (citing Holiday Inn v. Karch, 514 N.W.2d 374, 377 (N.D. 1994)) (emphasis added). While an employer may well find cause for discharge, this Court has clarified that "mere insufficiency, unsatisfactory conduct, failure in good performance as the result of inability or incapacity, inadvertencies or ordinary negligence in isolated instances, or good faith errors in judgment or discretion" are not deemed misconduct sufficient to disqualify a claimant from unemployment insurance benefits. Perske, 336 N.W.2d at 148-49 (emphasis added) (additional citations omitted). Because Ms. Schweitzer's telephone conversation with the staffing agency representative to inquire about an opening at LM and suggest her brother for the position did not violate an important employer interest or an explicit policy, her actions do not constitute disqualifying misconduct as this Court has defined it.
1. LM Failed to Demonstrate That Ms. Schweitzer's Conduct Implicated, Threatened, or Actually Harmed an Important Employer Interest.
According to this Court, an isolated incident can constitute benefit-disqualifying misconduct if it violates an important employer interest. Karch, 514 N.W.2d at 377 (citing Tehven v. Job Service North Dakota, 488 N.W.2d 48, 52 (N.D. 1992)). "When the conduct at issue is an isolated incident 'the connection between the conduct and the impact or potential impact on the employer's interest must be especially close.'" Hulse, 492 N.W.2d at 608 (citing Hins v. Lucas Western, 484 N.W.2d 491, 496 (N.D.1992)). LM, as the employer, had the burden to prove by a preponderance of the evidence that the phone call placed by Ms. Schweitzer constituted benefit-disqualifying misconduct. See, e.g., Schadler, 361 N.W.2d at 257. Because the facts do not establish the impact of Ms. Schweitzer's phone call on any interest of LM's, let alone an important interest, the employer failed to satisfy this burden. (R. at 46-112.)
In Karch, the Court found that the behavior of the employee did not rise to the level of disqualifying misconduct. Karch, 514 N.W.2d at 375. The employee worked at Holiday Inn and requested Christmas Day off. Id. at 375. Although she was not sure whether her request was granted, she refused to come into work on Christmas Day. Id. The Court explained that Karch's "decision not to work was, at most, an isolated instance of bad judgment" and "did not violate a critically important interest of her employer." Id. at 377. The Court added that "Karch's isolated behavior was the same kind of personnel problem that we have previously concluded is too far removed from the employer's important interest to be misconduct." Id. Most importantly, the Court found, even if Karch unreasonably thought she had the day off, her decision not to work was merely bad judgment and "not an intentional and substantial disregard of Holiday Inn's interest." Id.Just as Karch's absence on Christmas Day was "not essential to the success of Holiday Inn's buffet," Ms. Schweitzer's phone call to the staffing agency did not impede the success of LM. Id. Here, even if Ms. Schweitzer unreasonably believed she was in a position to communicate with Ms. Haugen, her phone call stood as only one instance of bad judgment and not an intentional disregard of LM's interest. No harm occurred as a result of her phone call since Ms. Haugen notified Ms. Schweitzer that her contact at LM was Rick Sandwick and that she was not aware of an opening. (R. at 140.) Ms. Schweitzer's conversation with Ms. Haugen at the staffing agency was at worst an isolated incident of poor decision-making on her part. Rather than intentionally or substantially disregarding the interest of LM, Ms. Schweitzer sought to advance it by seeking out the hiring of her brother, a hard worker she believed would succeed at LM. (R. at 100, 150-52.) Further, she did not willfully intend to misrepresent her position or authority within LM, direct Ms. Haugen's actions, or act outside her position. (R. at 99-102, 150-52.) Because LM was not negatively affected by Ms. Schweitzer's phone call in any way, that isolated incident did not violate an important interest of LM's.
2. Ms. Schweitzer's Phone Call Did Not Violate an Explicit LM Policy.
Alternatively, an isolated incident must violate an explicit policy to constitute benefit-disqualifying misconduct. Karch, 514 N.W.2d at 377 (citing Tehven, 488 N.W.2d at 52). Ms. Schweitzer's case finds additional similarity to Karch in that neither employee violated an express policy of the discharging employer. In Karch, this Court found that Karch's absence on Christmas Day did not violate an express policy of Holiday Inn and that she reasonably believed she had the day off. Id. Further, this Court said, because the belief was reasonable, she did "not violate a standard of behavior Holiday Inn had a right to expect." Id.
Ms. Schweitzer's telephone conversation with the staffing agency representative to suggest her brother for an open position did not violate an express policy. (R. at 141-43.) She was reasonable in her belief that she could contact Express because LM lacked a policy stating that she should not. Mr. Sandwick admitted that LM has no explicit policy forbidding employee contact with staffing representatives to inquire about open positions. (R. at 85.)
Ms. Schweitzer's good faith belief that she could make the phone call was also based on the "lead" assignment LM acknowledges it gave to her. (R at 73.) Ms. Hune informed the other temporary workers at LM that Ms. Schweitzer was a lead and that they were to follow what she said. (R. at 68-69.) Ms. Schweitzer understood that while she was taking on new responsibilities, she was not going to receive an accompanying pay increase and still accepted the position in order to prove that she was a valuable part of the company and to further LM's interest. (R. at 68, 96-97.) Mr. Muizelaar was also on notice that Ms. Schweitzer believed she was a lead and had the authority that comes with the position when she relayed her discussion with Ms. Hune to Mr. Muizelaar. (R. at 98.) During this conversation, Mr. Muizelaar did not make a comment or utterance to indicate that she was mistaken in her belief as a lead. (R. at 98.) Because Ms. Schweitzer's phone call did not violate an express policy of LM and was made in good faith, this isolated incident does not constitute disqualifying misconduct.
C. Ms. Schweitzer's Isolated Phone Call Did Not Rise to the Level of Disqualifying Misconduct as Defined by This Court.
In Perske, this Court announced a definition setting forth four kinds of conduct amounting to the disqualifying misconduct required for the denial of unemployment compensation benefits. Perske, 336 N.W.2d at 148 (citing Boynton, 296 N.W. 636 (Wis. 1941)). See also Rainey, 536 N.W.2d at 376. According to this definition, this Court must reverse the decision to deny Ms. Schweitzer unemployment benefits because her single telephone call to the staffing agency representative: (1) was not made in willful or wanton disregard of LM's interest, (2) was not so carelessly or negligently made that it manifested equal culpability, (3) did not demonstrate wrongful intent or evil design, and (4) did not show Ms. Schweitzer intentionally and substantially disregarded LM's interest or her own duties and obligations. Perske, 336 N.W.2d at 148 (citing Johnson, 1999 ND 42, ¶ 11, 590 N.W.2d 877). Based on the facts in this case, the telephone call that led to LM's dismissal of Ms. Schweitzer does not rise to the level of disqualifying misconduct.
1. Ms. Schweitzer's Phone Call Was Not Made in Willful or Wanton Disregard of LM's Interest.
In placing a single phone call to Express, Ms. Schweitzer acted neither willfully nor wantonly in disregard of LM's interest. Ms. Schweitzer did not consciously misrepresent her position or authority as an LM employee. (R. at 100, 151.) Rather, she relied in good faith on her conversations with the Production Manager, Ms. Hune, and her immediate supervisor, Mr. Muizelaar, in which she was granted lead authority over the temporary workers in her department. (R. at 68-69, 73.) At no point during the phone call did Ms. Schweitzer express that she had the power to hire new employees or otherwise hold herself out to Ms. Haugen as having that power. (R. at 68-69.) As described above, when an isolated incident forms the basis of the disqualifying conduct, "the connection between the conduct and the impact or potential impact on the employer's interest must be especially close." Hins, 484 N.W.2d at 496. An isolated instance of poor judgment is misconduct "only if the facts and circumstances of the case require it." Johnson, 1999 ND 42, ¶ 13, 590 N.W.2d 877. This Court has previously found isolated acts to rise to the level of disqualifying conduct where they constituted willful or wanton disregard of the employers' important interest. See, e.g., Stalcup, 1999 ND 67, ¶ 1, 592 N.W.2d 549; Rainey, 536 N.W.2d at 379; Blueshield v. Job Service North Dakota, 392 N.W.2d 70, 71-72 (N.D. 1986). Ms. Schweitzer's phone call can be distinguished from the aggravated conduct that was reviewed in each of those cases. In Stalcup, the discharged employee knew and agreed to follow the employer's drug policy stating "corrective actions for an employee who tests positive for a prohibited drug shall be immediate termination, unless prohibited by state law." Stalcup, 1999 ND 67, ¶ 2, 592 N.W.2d 549. Stalcup underwent a random drug test, tested positive for marijuana, and was terminated immediately. Id. at ¶ 2. She was terminated for the single violation of a company policy and was also disqualified from receiving unemployment benefits. Id. at ¶ 5. In Rainey, the discharged employee was denied unemployment benefits based on an isolated incident of fighting at work in direct violation of the company policy. Rainey, 536 N.W.2d at 379. During work, a physical altercation ensued between Rainey and a co-worker. Id. at 375. After being instructed to stop, Rainey continued to fight and escalate combat, including grabbing a butcher knife after her opponent was disarmed. Id. at 376. According to the company handbook, there was an explicit "no fighting" policy of which Rainey was well aware. Id. at 379. This Court found that the fight amounted to misconduct disqualifying the employee from receiving unemployment benefits because "Rainey's escalation of the encounter constituted misconduct evidencing a willful disregard of her employer's interest." Id. at 379.In Blueshield, the discharged employee was terminated for pushing another man despite a clear policy set forth in the employer's handbook stating that an employee who uses physical force against another employee will automatically be terminated. Blueshield, 392 N.W.2d at 71-72. This Court upheld the agency's denial of Blueshield's benefits because the use of physical force against the company policy amounted to disqualifying misconduct. Id. at 74. The Court was careful to qualify, however, that "[a]n isolated hotheaded incident certainly will not necessarily result in disqualification of unemployment compensation benefits because of 'misconduct.' Whether or not an isolated incident constitutes 'misconduct' depends upon the facts and circumstances of each individual case." Id. (citing Schadler, 361 N.W.2d at 254).Ms. Schweitzer's case is distinguishable from the above cases in that she did not wantonly or willfully compromise any interest demonstrated by LM. Unlike the above cases, LM does not assert that Ms. Schweitzer violated an explicit rule or policy provided in the LM handbook. (R. at 85.) Testifying to this point on LM's behalf, Mr. Sandwick admitted that LM does not have a specific policy restricting employees from calling the staffing agency and inquiring about an open position. (Id.) Moreover, LM presented no other evidence showing that Ms. Schweitzer's phone call implicated or harmed any important interest of the company. (R. at 46-112.) When Ms. Schweitzer called the staffing agency to inquire about a position she believed to be open and to suggest that her brother begin the paperwork process to be considered an Express temporary worker, she did not make a conscious effort to violate any LM policy or interest. (R. at 85, 152.) Ms. Schweitzer did not receive a warning, as Rainey had, about speaking with the staffing agency; she also was not put on notice that the conversation with the representative was intolerable until after her termination. (R. at 3, 56.) Job Service reasonably should have determined that Ms. Schweitzer was not aware she was violating a company policy and that she did not willfully act against LM's interests. Unlike Rainey and Blueshield, where the misconduct was an obvious infraction, Ms. Schweitzer's conduct did not directly or negatively affect other persons. Thus, this Court should find that Ms. Schweitzer's phone call was just a good faith error in judgment and not a willful or wanton disregard of anyone's interest. For these reasons, when compared to Stalcup, Rainey, and Blueshield, Ms. Schweitzer's actions did not rise to the level of misconduct that would disqualify her from unemployment insurance benefits. On the other hand, there are cases comparable to Ms. Schweitzer's where this Court found that a single incident did not constitute misconduct. In Stevick, the petitioner worked for Spectrum Care LLC and was terminated from her job because she had left the emergency call system unattended when she had taken a cigarette break. Stevick, 2006 ND 155, ¶ 11-13, 718 N.W.2d 593. Spectrum asserted that all of its "employees are instructed that there must always be someone attending the emergency call system and anyone leaving the system unattended would be terminated." Id. at ¶ 3. Stevick testified that she was unaware of a policy that required there must always be someone attending the emergency call system and that her brief absence was in good faith. Id. at ¶ 4. The Appeals Referee found that Stevick's behavior did not rise to the level of disqualifying misconduct and, therefore, did not prevent her from receiving unemployment benefits. Id. at ¶ 5. This Court affirmed that determination. Id. at ¶ 1.Stevick's act of leaving an emergency call system unattended left residents with no way to receive emergency assistance if needed, which could have led to a life-threatening situation. By comparison, Ms. Schweitzer's simple act of calling the staffing agency and suggesting her brother for an open position does not come close to the seriousness of the circumstances in Stevick. Where this Court found that Stevick's shocking behavior did not rise to the level of disqualifying misconduct, Ms. Schweitzer's good faith attempt to further LM's interests by filling an open position with a good worker certainly does not rise to that level. Id. at ¶ 13. Similarly, in Hulse, this Court found the employee's single act of uttering an expletive was not enough to constitute benefit-disqualifying misconduct because it was obvious that he neither willfully nor wantonly disregarded his employer's interest nor intended to disrupt the status quo. Hulse, 492 N.W.2d at 608. Just as Hulse's objective was not to abuse or belittle a resident by his remark, it similarly was not Ms. Schweitzer's objective to misrepresent herself or her authority to the staffing agency representative. Id. Another parallel can be drawn to Ms. Schweitzer because there is no evidence that Ms. Schweitzer undermined the interests of LM. Simply because an employee was discharged for an alleged incident of misconduct does not mean that that incident rises to the level of disqualifying misconduct sufficient to prevent that employee from unemployment compensation benefits. Steele, 445 N.W.2d at 642.In summary, Ms. Schweitzer's case has circumstances similar to those cases in which this Court has found that the conduct at issue did not rise to the level of benefit-disqualifying misconduct. First, the conduct was limited to a single incident, one phone conversation with the staffing agency representative. (R. at 56.) Second, the conduct did not violate an explicit policy of the employer. (R. at 141-43.) Mr. Sandwick has admitted that the employee handbook contains no explicit policy forbidding employee contact with temporary staffing representatives to inquire about a position. (R. at 85.) Furthermore, Ms. Schweitzer relied in good faith on her conversation with the production manager, Ms. Hune, and later her immediate supervisor, Mr. Muizelaar, about taking on the lead position; she had a reasonable belief she was a lead. (R. at 95, 98.) Lastly, it is obvious Ms. Schweitzer did not place the phone call with the intent to cause harm to her employer's interests. Ms. Schweitzer was a hard worker, and she also knew that her brother was a hard worker, so she felt that her brother could further LM's interests; because of this, she contacted the staffing agency to suggest her brother for a position she believed was open and needed to be filled. (R. at 151-52.) If anything, Ms. Schweitzer contacted Ms. Haugen with the intention of helping LM, not to cause harm to their interests. Therefore, Ms. Schweitzer neither willfully nor wantonly disregarded LM's interests.
2. Ms. Schweitzer's Phone Call Was Not so Careless or Negligent as to Amount to a Willful or Wanton Disregard of LM's Interest.
Ms. Schweitzer's single phone call to the staffing agency was not so careless or negligent as to amount to a willful or wanton disregard of LM's interest even though this behavior may be perceived as mildly careless or a good faith error in judgment. While an employer may well find cause for discharge, it is established that "'mere insufficiency, unsatisfactory conduct, failure in good performance as the result of inability or incapacity, inadvertencies or ordinary negligence in isolated instances, or good faith errors in judgment or discretion'" are not deemed misconduct sufficient to disqualify a claimant from unemployment insurance benefits. Hulse, 492 N.W.2d at 608 (citing Perske, 336 N.W.2d at 148-49) (emphasis added).
Even if this Court finds Ms. Schweitzer's conduct to be careless, it was not more than ordinary negligence or a good faith error in judgment or discretion. The record indicates that Ms. Schweitzer was instructed by Ms. Hune to act as a lead for the temporary workers who had been hired to clean the premises. (R. at 95, 108.) Additionally, when Mr. Muizelaar, Ms. Schweitzer's supervisor, became aware of the fact that Ms. Schweitzer thought of herself as a lead, he made no comment or utterance to indicate that she was mistaken. (R. at 98.) Therefore, when Ms. Schweitzer contacted Ms. Haugen at the staffing agency, she acted with reasonable good faith when communicating what she believed her position to be at LM. (R. at 99-102, 131.) Moreover, the record does not show that Ms. Schweitzer carelessly threatened any interest of LM by making the call. (R. at 46-112.)
Under these circumstances, Ms. Schweitzer's one phone call to inquire about a potential job for her brother did not so carelessly or negligently disregard LM's interest as to establish willful or wanton conduct. In fact, the opposite is true; she was making a reasonable, good faith effort to further LM's interest by suggesting her brother for the job in the knowledge that he was a hard worker and had a good work ethic. (R. at 100.)
3. Ms. Schweitzer's Call to the Staffing Agency Representative to Refer Her Brother For A Position She Believed Was Open Was Not Made With Wrongful Intent or Evil Design.
This Court has found that when a claimant has understood that the prohibited behavior was wrong, his actions evinced an intentional and substantial disregard of the standard of behavior which his employer had the right to expect from him. Marion, 470 N.W.2d at 612. It is clear, from the facts, that Ms. Schweitzer harbored no wrongful intent or evil design when she contacted Ms. Haugen at the staffing agency because she in no way believed that her actions were wrong. (R. at 129, 131, 150-52.) Ms. Schweitzer was a hard worker and knew the same was true about her brother. (R. at 100.) Therefore, she was attempting to help her brother while furthering LM's interests by suggesting him for a position she believed was open. (R. at 71, 100.) She contacted Ms. Haugen simply to find out if it was possible for her brother to apply for the position; she did not instruct Ms. Haugen to hire him. (R. at 99-102.) She was simply trying to suggest her brother for the job, knowing he was a hard worker and had a good work ethic. (R. at 100, 151.) Therefore, it is evident from the facts that Ms. Schweitzer harbored no wrongful intent or evil design when she merely called the staffing agency.
4. Ms. Schweitzer Neither Intentionally Nor Substantially Disregarded LM's Interests or Her Own Duties and Obligations When She Made A Single Phone Call to the Staffing Agency.
The facts and circumstances already set forth above establish that Ms. Schweitzer's call to Express was not made with an intentional disregard for LM's interests. Likewise, there is no evidence sufficient to conclude that she intentionally violated any duties or obligations to LM. She referred her brother for a job, knowing he was a hard worker, but did not order Ms. Haugen to hire him. (R. at 99-102.) She identified herself as holding the position she believed she held at LM when she called about a job she thought was open. (R. at 71, 131.) She made the call on Friday, December 14, 2007, and based on the fact that she worked Sunday through Thursday shifts, it is evident she made this phone call outside of work. (R. at 95, 140.)
Any interest that LM may assert was implicated by Ms. Schweitzer's phone call was neither intentionally nor substantially disregarded. At most, she may have neglected to anticipate the assumption by Ms. Haugen that Ms. Schweitzer was overstepping her authority to hire in the manner that Mr. Sandwick normally did. Furthermore, Ms. Schweitzer did not repeat the conduct at issue. This Court has found that an employee disregarded their employers' interests when the conduct was repeated and therefore ignored an explicit policy. Medcenter One, Inc. v. Job Service North Dakota, 410 N.W.2d 521, 523 (N.D. 1987); Skjefte v. Job Service North Dakota, 392 N.W.2d 815, 818 (N.D. 1986)
In Medcenter, petitioner Krein was a registered nurse at a hospital for two and a half years and had been "warned explicitly on more than one occasion not to discuss her personal problems with patients." Medcenter, 410 N.W.2d at 523-25. Krein knew of the instructions from her employer not to have these discussions and admitted that she continued to have the conversations with patients after receiving multiple warnings. Id. at 523. After she was fired, the Appeals Referee concluded that her repeated violations after multiple warnings did constitute disqualifying misconduct. Id. The Referee found that her final infraction showed a substantial disregard of the employer's interest and was therefore misconduct in connection with her work. Id. Similarly, in Skjefte, the petitioner continually disregarded her employer's policy by accepting personal phone calls, even after receiving two warnings and acknowledging in writing that she was aware of the policy and knew she could be terminated if her behavior continued. Medcenter, 410 N.W.2d at 524 (citing Skjefte, 392 N.W.2d at 818). After her termination, Skjefte was not awarded unemployment benefits when her actions were deemed to be so recurrent as to rise to the level of carelessness or negligence which amounted to a willful and wanton disregard of her employer's interest. Id. at 524. Unlike the cases above, Ms. Schweitzer did not repeat the conduct at issue after being told it was wrong; rather, her conduct was limited to a single, isolated incident. Ms. Schweitzer made the phone call on her own time, on Friday, December 14, 2007. (R. at 140.) The record indicates Ms. Schweitzer only worked Sunday through Thursday shifts at LM. (R. at 95.) She was not afforded a warning or even told that her conduct was against LM's interest at any time before her termination. (R. at 135.) She was also never given a chance to explain her behavior, as the scheduled meeting to discuss the incident was cancelled by either Dan Gordon or Gerald Muizelaar. (R. at 72.) Instead, Ms. Schweitzer was terminated from her job at LM for making the one phone call and was also denied unemployment compensation benefits. (R. at 139.) Even if the call can be characterized as careless or negligent, the facts in the record do not support a conclusion that she intentionally disregarded LM's interests or violated her own employment-related duties to LM. Furthermore, in Medcenter and Skjefte, the petitioners violated a set rule or policy. Medcenter, 410 N.W.2d at 524 (citing Skjefte, 392 N.W.2d at 818). As has been discussed previously, Ms. Schweitzer did not violate an explicit policy at LM. Mr. Sandwick has admitted that the employee handbook contains no explicit policy forbidding employee contact with staffing representatives to inquire about a position. (R. at 85.) Even if Ms. Schweitzer's perception concerning the position she held was erroneous, she did not act with such negligence or carelessness to rise to the level of disqualifying misconduct and, therefore, her behavior can only be perceived as possibly unsatisfactory or a good faith error in judgment. Though the behavior may have been grounds for termination, she did not so ignore her duties and obligations as to be disqualified for unemployment benefits. For the foregoing reasons, Ms. Schweitzer's single phone call to the staffing agency is not conduct which rises to the level of benefit-disqualifying misconduct as defined by this Court. The behavior was an isolated incident which did not affect LM's interests, nor did it violate an express policy of the company. Ms. Schweitzer neither willfully nor wantonly disregarded her employer's interest; she did not act carelessly or negligently enough to manifest wrongful intent or evil design; she did not intentionally disregard anyone's interest or go so far past her work obligations to constitute proper denial of her unemployment benefits. Therefore, reversal is required because the agency's findings of fact do not sustain its conclusion of law that Ms. Schweitzer engaged in disqualifying misconduct.III. Ms. Schweitzer was Denied a Fair Hearing Because the Appeals Referee Abused His Discretion by Failing to Admit and Consider All Evidence in a Fair and Impartial Manner.
Crystal Schweitzer proffered evidence that the Appeals Referee refused to hear or consider, without any explanation. While the standards required to satisfy due process at administrative hearings are not identical to those required in a court of law, administrative hearings are required to be conducted in a fair and impartial manner. See N.D.C.C. §§ 28-32-31; 52-06-23; Froysland v. North Dakota Workers Comp. Bureau, 432 N.W.2d 883, 893 (N.D. 1988). "Judicial review of [administrative actions are] the ultimate due process protection accorded those aggrieved." First Am. Bank & Trust Co. v. Ellwein, 221 N.W.2d 509, 514 (N.D. 1974).
Under North Dakota case law, an administrative hearing "is unfair when the defect complained of might lead to a denial of justice." Schadler, 361 N.W.2d at 258 (citing In re Township 143 North, Range 55 West, Cass County, 183 N.W.2d 520, 534 (N.D. 1971)). Due process requires, at a minimum, notice of the issues to be determined, an opportunity to be heard, and assurances that evidence presented will be reviewed in a fair and impartial manner. First Am. Bank, 221 N.W.2d at 514 (additional citations omitted) (stating equal opportunity to present evidence and having the evidence "carefully considered by the administrative agency" are part of the elements deemed essential to due process of law); Barnett v. North Dakota Dep't of Human Servs., 551 N.W.2d 557, 559 (N.D. 1996) (requiring opportunity to present arguments and evidence establishing why termination of benefits should not take place for a hearing to be fair under due process clause).
The rules of evidence do not apply in an administrative hearing for unemployment benefits. Stalcup, 1999 ND 67, ¶ 11, 592 N.W.2d 549. "However, even where the rules of evidence are somewhat relaxed, section 52-06-20, N.D.C.C., requires administrative hearings be conducted in a 'manner as to ascertain the substantial rights of the parties.'" Id. See also N.D. Admin. Code 27-03-06-03. Correspondingly, it follows that strict adherence to evidence admissibility and procedure of admissibility need not apply so long as the parties involved have the opportunity to respond to or question the evidence. See N.D.C.C. § 52-06-20; Esselman v. Job Service North Dakota, 548 N.W.2d 400 (N.D. 1996) (finding claimant was not denied fair hearing where ex parte communication was presented to claimant and claimant had opportunity to respond).
Only the administrative agency is allowed to accept and consider evidence presented. No judicial body is allowed to accept new evidence that was not presented to the administrative agency. Lewis v. North Dakota Workers Comp. Bureau, 2000 ND 77, ¶ 9, 609 N.W.2d 445. Therefore, during the administrative process it is vitally important to receive all relevant materials into evidence because neither party will have the opportunity to do so at a later time. See generally Stalcup, 1999 ND 67, ¶ 6, 592 N.W.2d 549.
The Appeals Referee failed to admit or even listen to the tape recordings Ms. Schweitzer offered as evidence. Ms. Schweitzer referenced conversations contained on the refused tape recordings throughout her cross-examination of LM representatives Gerald Muizelaar and Dan Gordon. (R. at 72-73, 80, 98.) Ms. Schweitzer offered the tapes into evidence at the end of the hearing. (R. at 111.) The Appeals Referee rejected the tape recordings and failed to provide any explanation as to why these recordings would not be considered before he made a decision. (Id.) The Referee's decision does not refer to the tapes and does not provide any reason why this evidence was rejected when all evidence and testimony offered by LM was adopted. (R. at 50-51, 111, 131-33.)
The Referee's refusal to consider Ms. Schweitzer's evidence was improper because the Referee is responsible for ensuring relevant evidence be admitted. See N.D.C.C. § 52-06-23. If the Referee had any concerns about the relevancy of this evidence, the record does not reflect them. It is the duty of the Referee to compel such evidence, not reject it, in order to ascertain the rights of the parties. See N.D.C.C. § 52-06-23; Stalcup, 1999 ND 67, ¶ 11, 592 N.W.2d 549. Prior to making a final decision as to affirm the initial unemployment benefits decision, the Appeals Referee is obligated to consider and appraise the evidence. See Schultz v. North Dakota Dep't of Human Servs., 472 N.W.2d 888, 892 (N.D. 1985). Refusing to consider or admit the tapes into evidence deprived Ms. Schweitzer of a fair opportunity to present her evidence and to be heard on matters concerning her claim.
The Referee's rejection of Ms. Schweitzer's evidence is particularly egregious because the employer's evidence was adopted by the Referee in its entirety. Clear precedent requires that "both parties should be given equal opportunity to present evidence and such evidence should be carefully considered by the administrative agency." Schadler, 361 N.W.2d 254, 258 (N.D. 1985). But see May v. Sprynczynatyk, 2005 ND 76, ¶ 24, 695 N.W.2d 196 (hearing officer is afforded broad discretion to control the admission of evidence at the hearing, and the decision to admit or exclude evidence will only be reversed on appeal if the hearing officer abused his discretion).
Failure to admit these tapes was an abuse of the Referee's discretion because Ms. Schweitzer relied on the tapes to substantiate the facts concerning her conduct and the Referee failed to articulate any basis for refusing to even consider the evidence she offered. Ms. Schweitzer was not afforded a fair hearing in compliance with due process. This defect warrants reversal to the Administrative Agency with instructions to admit the rejected evidence and to address the evidence presented by both sides in reaching its decision.
CONCLUSION Ms. Schweitzer respectfully requests that this Court reverse the decision of Job Service North Dakota and order that she receive unemployment benefits because she was not discharged for conduct that rose to the level of disqualifying misconduct.
In the alternative, she respectfully requests this Court remand to Job Service North Dakota for a Lower Authority Appeal telephone hearing that includes appraisal of all evidence relevant to the issue of Ms. Schweitzer's conduct leading to her discharge on January 18, 2008.
Dated: February __, 2009.
Respectfully Submitted
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