Kaup v. Tex. Workforce Comm'n

• Decision Date: 23 December 2014
• Docket Number: NO. 01–14–00084–CV,01–14–00084–CV
• Citation: 456 S.W.3d 289
• Parties: David E. Kaup, Appellant v. Texas Workforce Commission, Global Security Consulting, & Global Security Associates, Appellees
• Court: Texas Court of Appeals

456 S.W.3d 289

David E. Kaup, Appellant

v.Texas Workforce Commission, Global Security Consulting, & Global Security Associates, Appellees

NO. 01–14–00084–CV

Court of Appeals of Texas, Houston (1st Dist.

Opinion issued December 23, 2014

David E. Kaup, Highlands, TX, for Appellant.

Amanda K. Hudson, Assistant Attorney General, Austin, TX, William J. McDermott, Lake Success, NY, Keval Patel, Houston, TX, for Appellee.

Panel consists of Justices Massengale, Brown, and Huddle.

OPINION

Harvey Brown, Justice

David Kaup was denied unemployment benefits by the Texas Workforce Commission upon the TWC's finding that he was fired by his employer, Global Securities, for misconduct. After unsuccessfully appealing that decision to the TWC Appeal Tribunal, Kaup appealed to the district court. TWC filed a motion for summary judgment, which the trial court granted. The trial court entered a final judgment, holding that there was substantial evidence to support the TWC decision and affirming that judgment.¹ Kaup contends that the trial court erred by granting TWC's summary-judgment motion. We affirm.

Background

David Kaup has a degree in criminal justice administration and many years of experience in law enforcement and private security. He holds multiple security-related certifications and licenses, including a Qualified Manager's License from the Texas Private Security Bureau.

Global Security hired Kaup in July 2010 as a security compliance officer to hold the company's Qualified Manager license, train employees, conduct fingerprinting, and handle its employees' state licensing applications and renewals. The Global Securities job application asked Kaup to list all “periods of unemployment,” to which Kaup responded: “5/6/10—NOW.”

One year into his employment at Global Securities, the company approached Kaup about reducing his position to part-time status; Kaup did not agree to reduce his hours and continued working full-time.

The following year, in March 2012, Kaup signed an “Employee Handbook Acknowledgement Form,” affirming this statement: “I have received the handbook, and I understand that it is my responsibility to read and comply with the policies contained in this handbook and any revisions made to it.” The Handbook contained the following provision:

Conflicts of Interest/Other Employment

GS believes in conducting all company operations in an ethical manner and in compliance with federal laws and the laws of the states in which it does business. A conflict of interest may arise in any situation in which an employee's loyalties are divided between business interests that, to some degree, are incompatible with the interests of GS. If an employee decides to seek additional employment, the employee must let their manager know to ensure that there is no conflict of interest. All such conflicts should be avoided. GS expects absolute integrity from all employees and will not tolerate any conduct that falls short of that standard. GS expects that no employee will knowingly place himself or herself in a position that would have the appearance of being, or could be construed to be, in conflict with the interests of the company.

GS recognizes and respects its employees' rights to participate in outside activities. However, certain activities are prohibited because they are considered a conflict of interest. Situations involving possible conflicts of interest will be evaluated on a case-by-case basis consistent with company policy. For questions about a potential conflict of interest, bring it to the attention of a manager or Human Resources. Where undisclosed and unapproved conflicts of interest occur, corrective action may result, including termination of employment.

Kaup continued to work full-time at Global Securities after signing this acknowledgement.

On September 2, 2012, Global Securities placed an anonymous job listing on the ziprecruiter.com website soliciting resumes for a security manager position in Houston, Texas. The listing did not specify if the position was full-time or part-time. There was no indication that Global Securities was the company behind the listing. According to Global Securities Director of Human Resources & Administration, Audrey Villani, Global Securities posted the position to find a replacement for Kaup “in case [he] decided to leave the company ... if [his position] were to become part time.”

At 9:00 in the morning on September 11, Global Securities received an application for the position from Kaup's personal email account. The email was received during Kaup's regular work hours at Global Securities. According to Kaup's attached resume, he had an on-going business relationship with three separate security companies at that time. In addition to his employment with Global Securities from July 2010 forward, Kaup disclosed that he had been a consultant to Shelter Security since May 2009 and to GT Security Solutions since March 2012.

Global Securities responded by terminating Kaup's employment one week later. His termination letter explains that, “[i]n addition to applying for employment with other companies during work hours, you have obtained a secondary employment without approval. Our employee handbook states that secondary employment must be previously approved.” After noting that Kaup never requested approval for the two consulting positions, the letter explains that Kaup's “employment with the company is terminated immediately for violating company policies, as stated above.”

Kaup sought unemployment benefits from TWC but was denied as a result of “violation of company rules and policies” which “is considered misconduct connected with the work.” Kaup appealed the decision to the TWC Appeal Tribunal and was again denied. Kaup filed a petition with the district court seeking judicial review of the denial of unemployment benefits. Both Kaup and the TWC filed motions for summary judgment. The trial court granted TWC's motion and entered a final judgment declaring that “there is substantial evidence to support the Texas Workforce Commission decision” and affirming the denial of unemployment benefits. Kaup timely appeals that judgment.

Challenge to TWC Ruling

Kaup argues that the TWC erred by denying his benefits and the district court erred by granting summary judgment to TWC because Global Securities's restrictive policies are not enforceable and Kaup has a defense to the assertion of employee misconduct.

A. Standard of review

1. Summary judgment

We review a summary judgment de novo. Travelers Ins. Co. v. Joachim, 315 S.W.3d 860, 862 (Tex.2010). We consider the evidence presented in the light most favorable to the nonmovant, crediting evidence favorable to the nonmovant if reasonable jurors could and disregarding evidence contrary to the nonmovant unless reasonable jurors could not. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex.2009). We indulge every reasonable inference and resolve any doubts in the nonmovant's favor. 20801, Inc. v. Parker, 249 S.W.3d 392, 399 (Tex.2008).

2. Substantial evidence

The applicable standard of review for a TWC decision is “trial de novo based on the substantial evidence rule.” Tex. Lab.Code Ann. § 212.202(a) (West 2006); Mercer v. Ross, 701 S.W.2d 830, 831 (Tex.1986) ; Tex. Workforce Comm'n v. City of Houston, 274 S.W.3d 263, 266 (Tex.App.–Houston [1st Dist.] 2008, no pet.). A TWC decision carries a presumption of validity, and the party seeking to set it aside has the burden to show it was not supported by substantial evidence. City of Houston, 274 S.W.3d at 266 (citing Mercer, 701 S.W.2d at 831 ). Whether TWC's decision is supported by substantial evidence is a question of law. Id.; Blanchard v. Brazos Forest Prods., L.P., 353 S.W.3d 569, 572 (Tex.App.–Fort Worth 2011, pet. denied).

Kaup argues that the substantial evidence standard places this appellate court “in the position of being a trier of fact” and requires us to reverse the trial court's judgment if the TWC fails to convince us that “a ‘reasonable person’ would not have reached a different conclusion” than the TWC did, based on evidence presented to it. This misstates the standard of review for TWC determinations.

Under the substantial evidence rule, the burden is on Kaup—as the party who seeks to set aside the TWC's ruling—to demonstrate that less than substantial evidence supports the decision. See City of Houston, 274 S.W.3d at 266. We do not weigh the evidence to decide whether TWC made the correct decision but, instead, ask “whether the evidence introduced before the trial court shows facts in existence at the time of the [TWC's] decision that reasonably support the decision” it reached. Collingsworth Gen. Hosp. v. Hunnicutt, 988 S.W.2d 706, 708 (Tex.1998) ; Blanchard, 353 S.W.3d at 572. If the evidence is such that reasonable minds could have reached the same conclusion as the TWC, the agency's decision must be upheld. City of Houston, 274 S.W.3d at 267 ; Blanchard, 353 S.W.3d at 572. In other words, “[i]f substantial evidence would support either affirmative or negative findings, we must uphold the agency decision and resolve any conflicts in favor of the agency decision.” Farris v. Fort Bend Indep. Sch. Dist., 27 S.W.3d 307, 312 (Tex.App.–Houston [1st Dist.] 2000, no pet.) (citing Auto Convoy v. R.R. Comm'n, 507 S.W.2d 718, 722 (Tex.1974) ). “We may not set aside an agency decision merely because testimony was conflicting or disputed or because it did not compel the agency's decision.” Scally v. Tex. State Bd. of Med. Exam'rs, 351 S.W.3d 434, 441 (Tex.App.–Austin 2011, pet. denied) (citing Firemen's & Policemen's Civil Serv. Comm'n v. Brinkmeyer, 662 S.W.2d 953, 956 (Tex.1984) ). “If there is substantial evidence which supports the order, the courts are bound to follow the discretion of the administrative body.” Brinkmeyer, 662 S.W.2d at 956. It is the agency's function to resolve conflicts in evidence, and “it is the aim of the substantial evidence rule to protect that function.” Id.

“...