Long v. Dist. of Columbia

• Decision Date: 16 February 1990
• Docket Number: No. 88-913.,88-913.
• Citation: 570 A.2d 301
• Parties: Sylvia J. LONG, Petitioner, v. DISTRICT OF COLUMBIA DEPARTMENT OF EMPLOYMENT SERVICES, Respondent. Potomac Electric Power Company, Intervenor.
• Court: D.C. Court of Appeals

570 A.2d 301

Sylvia J. LONG, Petitioner, v. DISTRICT OF COLUMBIA DEPARTMENT OF EMPLOYMENT SERVICES, Respondent Potomac Electric Power Company, Intervenor.

No. 88-913.

District of Columbia Court of Appeals.

Argued November 7, 1989.

Decided February 16, 1990.

Rebecca K. Troth, with whom Jane Lang, Washington, D.C., was on the briefs, for petitioner.

N. Denise Wilson-Taylor, Washington, D.C., for respondent.

George W. Miller, with whom Barbara L. Sloan and Susan H. Power, Washington, D.C., were on the brief, for intervenor.

Before ROGERS, Chief Judge, and STEADMAN and FARRELL, Associate Judges.

STEADMAN, Associate Judge:

Petitioner seeks review of a Department of Employment Services ("DOES" or "Department") decision holding her ineligible for unemployment compensation because she was discharged for "misconduct." Unfortunately, the record is inadequate to permit us to perform our appellate review function. Accordingly, we must remand for further agency action.

I

The factual setting, briefly put, was as follows. Petitioner, then an employee of Potomac Electric Power Company ("PEPCO"), filed a charge in the District of Columbia Office of Human Rights ("OHR") on September 30, 1986, alleging that PEPCO had discriminated against her on the basis of race. Petitioner took with her to an OHR conference four PEPCO documents, which she obtained, at least in part, from PEPCO computer disks.¹ Five days later, after an investigation, PEPCO wrote petitioner: "As a result of your unauthorized entry into, and search of, Company records and your unauthorized removal of Company documents in violation of Company and Departmental rules, you are discharged, effective close of business, December 8, 1986."²

Petitioner applied for unemployment compensation. Two hearings were held before a DOES appeals examiner, the second following an order of remand by the DOES Office of Appeals and Review ("OAR").³ Each hearing resulted in an appeals examiner decision denying petitioner's claim.⁴ The second decision was summarily affirmed by OAR. An appeal was then taken to this court.

II

All agency action must ultimately rest upon legal principles established by statute, regulation or case law. Paramount in any agency decision for purposes of appellate review is a clear exposition of the legal principle or principles underlying the agency decision. "Where an administrative agency is delegated broad authority to administer a statutory scheme ... we defer to a reasonable construction of the statute made by the agency." Smith v. District of Columbia Dep't of Employment Servs., 548 A.2d 95, 97 (D.C.1988) (citations omitted). However, "absent an analysis staking out an agency position to which this court normally would accord some deference," Wells v. District of Columbia Dep't of Employment Servs., 513 A.2d 235, 242 (D.C.1986), we have no choice but to remand for clarification. "An administrative order can only be sustained on the grounds relied on by the agency; we cannot substitute our judgment for that of the agency." Jones v. District of Columbia Dep't of Employment Servs., 519 A.2d 704, 709 (D.C.1987) (citations omitted); see also Jadallah v. District of Columbia Dep't of Employment Servs., 476 A.2d 671, 675 n. 3 (D.C.1984) (per curiam).

In this case, the Department denied unemployment compensation on the ultimate ground that petitioner was discharged for "misconduct." The District of Columbia Unemployment Compensation Act, D.C. Code §§ 46-101 to 46-128 (1987) (the "Act"), is the controlling statute. It defines the word "misconduct":

For the purposes of this section, the term "misconduct" means an act of willful disregard of the employer's interests, a deliberate violation of the employer's rules, a disregard of standards of behavior which the employer has a right to expect of his employees, negligence to such a degree or recurrence as to manifest culpability, wrongful intent, or evil design, or showing an intentional and substantial disregard of the employer's interests or of the employee's duties and obligations to the employer.

D.C.Code § 46-111(b)(2) (1987). Furthermore, the Department, pursuant to statutory authority,⁵ has by regulation particularized the meaning of the word "misconduct" within the statutory scheme:

Misconduct occurring in the course of work includes, but is not limited to, the following:

(a) Willful violation of employer's rules;

(b) Intoxication;

(c) Repeated disregard of reasonable orders;

(d) Sabotage;

(e) Gross neglect of duties;

(f) Insubordination; and

(g) Dishonesty.

7 DCMR § 312.3 (1986). The regulations further provide:

If willful violation of employer's rules is the basis for a disqualification from benefits because of misconduct, the Director shall determine the following:

(a) That the existence of the employer's rule was known to the employee;

(b) That the employer's rule is reasonable; and

(c) That the employer's rule is consistently enforced by the employer.

Id. § 312.4.

It is clear that the appeals examiner was of the view, at least in part, that petitioner had engaged in "misconduct" because she had violated a PEPCO rule. The examiner did not make a clear finding, however, as to petitioner's mental state nor did the examiner articulate her view of the legal standard governing an employee's mental state.⁶ The Act requires that the violation be "deliberate"; the regulation uses the word "willful."⁷ The difficulty is that we cannot perceive the appeals examiner to have made any finding that petitioner's action here was either "willful" or "deliberate."⁸ Indeed, there is a rather telling indication to the contrary in the examiner's statement that "while claimant believes her conduct was not done in violation of the employer's rule her actions in this case can not be overlooked."⁹ The latter phrase may reflect the examiner's interpretation of the statute and regulations to mean that even if petitioner subjectively believed she was committing no violation, misconduct may be found when the employee should have known that the action would constitute a violation. If this is the examiner's view, she should make it explicit and set forth the legal reasoning. See Wells, supra, 513 A.2d at 242 (case with open legal issue remanded for "reasoned interpretation by the agency charged with administering the statute").¹⁰

It is possible that the appeals examiner alternatively relied upon a form of misconduct other than violation of an employer's rule.¹¹ She states that "the claimant's conduct was intentionally done against the legitimate interest of this employer." It is not clear what the source of this standard is, whether it is meant to be different from the rule violation standard and to what conduct the Department was referring. It may have been meant to coincide with the clause in section 46-111(b)(2) of the Act¹² which defines "misconduct" to include "an act of willful disregard of the employer's interests"; or, as suggested by the employer before us, it may have been meant to coincide with the clause "disregard of standards of behavior which the employer has a right to expect from his employees"; or it may have been meant to coincide with the clause "showing an intentional and substantial disregard of the employer's interest or of the employee's duties and obligations to the employer."¹³ We simply cannot tell with confidence what the hearing examiner meant. The full legal basis on which an administrative agency relies in its determination and its underlying factual determinations should not be left to appellate speculation.¹⁴

In short, we are unable to perform our function of appellate review where we cannot confidently ascertain either the precise legal principles on which the agency relied or its underlying factual determinations.¹⁵ "`The orderly functioning of the process of review requires that the grounds upon which the administrative agency acted be clearly disclosed and adequately sustained'." Gordon v. District Unemployment Compensation Bd., 402 A.2d 1251, 1258 (D.C.1979) (quoting SEC v. Chenery Corp., 318 U.S. 80, 94, 63 S.Ct. 454, 462, 87 L.Ed. 626 (1943)). Accordingly, we must remand the case for further proceedings consistent with this opinion.

So ordered.

1 There was some conflicting testimony both as to precisely what documents petitioner had and how she came to have them. No findings were made to resolve these conflicts.

2 The appeals examiner's first decision erroneously quotes this discharge letter as using the phrase "and violation of company and departmental rules" instead of "in violation of Company and Departmental rules" (emphases added). The distinction is important in determining the grounds of the discharge. See infra note 14. Moreover, it is unclear whether the phrase "in violation of Company and Departmental rules" modifies both the phrases "unauthorized entry into, and search of, Company records" and "unauthorized removal of Company documents" or whether it modifies only the latter phrase.

3 The remand stated that the examiner had failed to make adequate findings as to the sufficiency of the employer's asserted reasons for the discharge, see infra note 11, and as to the issue of consistent enforcement. See infra note 8. The appeals examiner's first decision simply stated that no evidence had been offered to show that the rule was not consistently enforced, but the remand order stated that the burden to make a showing of consistent enforcement was on the employer (citing 7 DCMR § 312.2 (1986) (burden of persuasion is on party alleging misconduct)). Although the remand was technically only for a new hearing on these two issues, in fact the second hearing considered many of the original issues anew.

4 The second decision appears to be complete in itself and does not incorporate by reference the first opinion. However, we have taken both opinions into account in considering this appeal. By stipulation of the parties, the record of the first hearing became part of...