Broms v. U.S. Department of Agriculture/Agricultural Marketing Service, No. A09-927 (Minn. App. 3/2/2010)

• Decision Date: 02 March 2010
• Docket Number: No. A09-927.,A09-927.
• Parties: Debra Broms, Relator, v. U.S. Department of Agriculture/Agricultural Marketing Service, Respondent, Department of Employment and Economic Development, Respondent.
• Court: Minnesota Court of Appeals

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Debra Broms, Relator, v. U.S. Department of Agriculture/Agricultural Marketing Service, Respondent, Department of Employment and Economic Development, Respondent.

No. A09-927.

Court of Appeals of Minnesota.

Filed March 2, 2010.

This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2008).

Appeal from the Department of Employment and Economic Development, File No. 21955575-3.

Debra L. Broms, Savage, Minnesota (pro se relator).

U.S. Department of Agriculture, Agricultural Marketing Service, Minneapolis Financial Services Branch, Minneapolis, Minnesota (respondent).

Lee B. Nelson, Amy R. Lawler, Department of Employment and Economic Development, St. Paul, Minnesota (for respondent Department).

Considered and decided by Toussaint, Chief Judge; Johnson, Judge; and Crippen, Judge.^*

UNPUBLISHED OPINION

JOHNSON, Judge.

Debra Broms quit her job after her employer proposed to demote her to a lower-level position with a lesser salary. An unemployment law judge (ULJ) determined that Broms is ineligible to receive unemployment benefits because she quit without a good reason caused by her employer. The ULJ's determination is based on factual findings that the employer had merely proposed the demotion but had not yet made a decision to demote Broms, and that Broms chose to quit in order to avoid a blemish on her employment history. We conclude that substantial evidence supports the ULJ's findings and, therefore, affirm.

FACTS

Broms was employed by the United States Department of Agriculture (USDA) as an accountant in its Minneapolis Financial Services Branch office. She began her employment there in 2003. In late 2007, Broms's supervisor expressed dissatisfaction with her performance and began to impose various forms of progressive discipline. In July 2008, Broms's supervisor placed her on a performance improvement plan that required her to improve in the areas of customer service, certification of payments, and special projects.

On January 12, 2009, Thomas Grahek, the branch chief of the Minneapolis Financial Services Branch, met with Broms and gave her written notice of a proposal to demote her from her current position, a Level GS-12.6 position in the federal civil service scheme, to a Level GS-9.1 position. See 5 C.F.R. § 432.101-.107 (2009) (prescribing procedures for demoting employee in federal civil service). At the time, Broms's annual salary in the Level GS-12.6 position was $83,383. She testified that the demotion would have reduced her salary by approximately $32,000, which was approximately 38% of her then-current salary. At the January 12 meeting, Grahek reviewed the demotion proposal with Broms and told her that it was a proposal. Broms acknowledged at the agency hearing that the demotion document was a proposal and that she had ten days in which to respond. The notice of proposal also stated that she could be represented by an attorney or other representative, that no decision would be made until all of the evidence was received, and that she would be given a written notice of decision with specific reasons for the decision. Mary Rucke, the assistant branch chief for employee relations, testified that the written decision also would include the employee's right to appeal to the United States Merit Systems Protection Board.

On January 22, 2009, Broms submitted a written response to the proposal and, simultaneously, submitted notice of her resignation, effective February 1, 2009. After receiving Broms's response and notice of resignation, Dave Root, the branch chief for employee relations, was concerned that Broms did not understand the process. He called Broms on several occasions but did not reach her. Root then asked Rucke to call Broms. Rucke did so but did not reach Broms and left her a voice-mail message stating that the notice of proposed demotion was merely a proposal and that no final decision had been made. Broms did not return Rucke's call.

After her resignation became effective, Broms applied for unemployment benefits. In February 2009, DEED denied her application because it determined that she quit her job without a good reason caused by her employer. Broms filed an administrative appeal. A ULJ conducted a telephonic hearing. Five witnesses testified: Broms and four witnesses called by USDA. In March 2009, the ULJ determined that Broms was ineligible for unemployment benefits because the USDA had not decided whether Broms would be demoted and had not taken any action that would amount to a good reason for her to quit. Broms requested reconsideration, and the ULJ affirmed his prior ruling. Broms appeals by way of a writ of certiorari.

DECISION

Broms argues that the ULJ erred by determining that she is ineligible for unemployment benefits because she quit without a good reason caused by her employer. This court reviews a ULJ's decision denying benefits to determine whether the findings, inferences, conclusions, or decision are affected by an error of law or are "unsupported by substantial evidence in view of the entire record." Minn. Stat. § 268.105, subd. 7(d) (2008). The evidentiary hearing is an evidence-gathering inquiry, not an adversarial contest, and is conducted without regard to any particular burden of proof. Id., subd. 1(b) (2008); Vargas v. Nw. Area Found., 673 N.W.2d 200, 205 (Minn. App. 2004), review denied (Minn. Mar. 30, 2004). The ULJ's factual findings are viewed in the light most favorable to the decision being reviewed. Skarhus v. Davanni's Inc., 721 N.W.2d 340, 344 (Minn. App. 2006). The ultimate determination whether an employee is ineligible for unemployment benefits based on employment misconduct is a question of law, which is subject to a de novo standard of review. Id.

An employee who quits employment is ineligible to receive unemployment benefits, unless an exception applies. Minn. Stat. § 268.095, subd. 1 (2008). One exception to the general rule is the situation in which an employee quits for a good reason caused by the employer. Id., subd. 1(1). A "good reason" is a reason "(1) that is directly related to the employment and for which the employer is responsible; (2) that is adverse to the worker; and (3) that would compel an average, reasonable worker to quit and become unemployed rather than remaining in the employment." Id., subd. 3(a) (2008).

Broms contends that she quit for a good reason caused by her employer because the demotion, from a Level GS-12.6 position to a Level GS-9.1 position, would have resulted in a significant decrease in her salary. Indeed, an employee who quits a job because of a significant decrease in compensation may be found to have quit for a good reason caused by the employer. Compare Hessler v. Am. Television & Radio Co., 258 Minn. 541, 549, 104 N.W.2d 876, 882 (1960) (holding that employees did not quit with good reason because employer reduced pay by 2-4%); Dachel v. Ortho Met., Inc., 528 N.W.2d 268, 270 (Minn. App. 1995) (holding that employee did not quit with good reason because employer reduced pay by 10%), with Scott v. Photo Ctr., Inc., 306 Minn. 535, 535-36, 235 N.W.2d 616, 616-17 (1975) (holding that employee quit with good reason because employer reduced pay by 25%); Rootes v. Wal-Mart Assocs., Inc., 669 N.W.2d 416, 419 (Minn. App. 2003) (holding that employee quit with good reason because she was demoted to position with approximately 16% less pay and disadvantageous hours); cf. Sunstar Foods, Inc. v. Uhlendorf, 310 N.W.2d 80, 83-85 (Minn. 1981) (holding that employees were eligible for unemployment benefits because employer's 21-26% reduction in wages was a lockout, not a strike).

But the ULJ rejected Broms's argument on a different ground. The ULJ found that the USDA "had not yet made any decision about whether or not Broms would be demoted." The ULJ explained, "When Broms quit, the employer had not taken the kind of adverse action that would have caused the average, reasonable worker to quit and become unemployed rather than remaining in the employment." These findings by the ULJ are supported by the evidentiary record in several respects. First, the written proposal for a demotion states:

This notice constitutes a...