ND DEPT. OF HUMAN SERVICES v. Ryan

• Decision Date: 19 December 2003
• Docket Number: No. 20030156.,20030156.
• Citation: 672 N.W.2d 649,2003 ND 196
• Parties: NORTH DAKOTA DEPARTMENT OF HUMAN SERVICES, Appellee, v. Thomas P. RYAN, Appellant.
• Court: North Dakota Supreme Court

672 N.W.2d 649

2003 ND 196

NORTH DAKOTA DEPARTMENT OF HUMAN SERVICES, Appellee, v. Thomas P. RYAN, Appellant.

No. 20030156.

Supreme Court of North Dakota.

December 19, 2003.

Rehearing Denied January 14, 2004.

Tag Christian Anderson, Assistant Attorney General, Bismarck, for appellee.

Mark G. Schneider (argued), Schneider, Schneider & Phillips, Fargo, and Christianne Yvette Runge (appeared), North Dakota Public Employees Association, Bismarck, for appellant.

MARING, Justice.

[¶ 1] Thomas P. Ryan appealed from a district court judgment reversing an administrative law judge's determination that she had jurisdiction to hear his appeals from two adverse employment decisions by the North Dakota Department of Human Services ("Department"). We hold the administrative law judge ("ALJ") had jurisdiction to hear Ryan's appeals, the district court had jurisdiction to hear Ryan's cross-appeal, and the ALJ's decision on the merits of the Department's employment decisions was supported by the evidence. We affirm the ALJ's decision on the merits.

I

[¶ 2] Ryan was employed by the Department as an addiction counselor at the Northwest Human Service Center in Williston when he was terminated under a reduction-in-force on December 1, 2000. The Department subsequently hired Ryan for an unclassified, temporary part-time position as a community home counselor on December 22, 2000. Within one year after Ryan was terminated under the reduction-in-force, the Department internally and externally advertised for vacancies at the Northwest Human Services Center for a "Mental Illness Case Manager II" and a "Human Relations Counselor." Ryan applied for both positions. The Department's human resource director determined Ryan met the "requirements" for both positions based upon "minimum qualifications as published in the job announcement." The Department then interviewed Ryan for both positions, but he was not hired for either job.

[¶ 3] Ryan filed grievances with the Department, claiming it was required to hire him for those positions under N.D. Admin. Code § 4-07-11-07, which provides:

An individual who has lost employment due to a reduction-in-force must be offered reemployment by the former employing agency if the following conditions are present:

1. A position vacancy occurs in the former employing agency, and the appointing authority decides to fill the vacancy by appointing someone other than a current employee.

2. The individual meets the minimum qualifications established for the particular position.

3. No more than one year has elapsed since the individual lost employment due to the reduction-in-force.

The Department denied Ryan's grievances, concluding (1) the reemployment mandates of N.D. Admin. Code § 4-07-11-07 did not apply to Ryan because he had accepted employment as a community home counselor, and (2) he did not meet the qualifications for either advertised position.

[¶ 4] Ryan appealed both determinations to the Central Personnel Division ("Division")¹ under N.D.C.C. § 54-44.3-12.2, which authorizes appeals by "nonprobationary employees in the classified service which are related to ... reduction in force." After a request by the Division, the Office of Administrative Hearings designated an ALJ to render a final decision on Ryan's appeals. The Department moved to dismiss his appeals, claiming the ALJ did not have jurisdiction under N.D. Admin.Code § 4-07-20.1-07, which provides that "[a] reduction-in-force appeal may be made only on the basis that the factors required by section 4-07-11-03 were not followed or that the reduction-in-force was conducted in a discriminatory manner that would violate the state's policy against discrimination" under N.D.C.C. § 14-02.4-01. The ALJ concluded she had jurisdiction to hear Ryan's appeals under

N.D.C.C. § 54-44.3-12.2 and N.D. Admin. Code § 4-07-11-07. The statute, N.D.C.C. § 54-44.3-12.2, is broad in its language. It provides for appeals related to a reduction-in-force. The administrative rule sections pertaining to appeals for a reduction-in-force in N.D. Admin. Code §§ 4-07-20.1-07 and 4-07-11-03 provide that an appeal may be made only on the basis that certain factors were not followed [in implementing the reduction-in-force] or that the reduction-in-force was conducted in a discriminatory manner. The administrative rule which limits reduction-in-force appeals to a determination whether certain factors were followed in conducting the reduction-in-force attempts to constrict the scope of the statute. The statute is both mandatory and controlling, and must therefore be applied over the administrative rule.

The ALJ nevertheless concluded the Department did not violate N.D. Admin. Code § 4-07-11-07 by failing to hire Ryan for either advertised position, because the hiring authority determined he did not meet the minimum qualifications for either position.

[¶ 5] The Department appealed the jurisdictional issue to the district court, and Ryan cross-appealed the ALJ's decision on the merits. The court concluded the ALJ did not have jurisdiction to hear Ryan's appeals and remanded to the ALJ to dismiss his appeals. The court alternatively decided the ALJ was correct in upholding the Department's decision not to hire Ryan.

II

[¶ 6] Under N.D.C.C. § 54-44.3-12.2, the Division "shall certify appeals from nonprobationary employees in the classified service which are related to discrimination, merit system qualification, reprisals, reduction in force, forced relocation, demotion with loss of pay, suspension without pay, and dismissal, and from applicants for positions in the classified service related to discrimination." The Division shall request the Director of the Office of Administrative Hearings to designate an ALJ to "conduct the hearing and related proceedings, including receiving evidence and preparing findings of fact, conclusions of law, and issuing a final decision." N.D.C.C. § 54-44.3-12.2.

[¶ 7] An appeal from the ALJ's final decision to the district court must be filed under N.D.C.C. ch. 28-32. N.D.C.C. § 54-44.3-12.2. Under N.D.C.C. § 28-32-46, the district court must affirm the ALJ's decision unless:

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 this chapter 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 the appellant.

8. The conclusions of law and order of the agency do not sufficiently explain the agency's rationale for not adopting any contrary recommendations by a hearing officer or an administrative law judge.

If the order of the agency is not affirmed by the court, it must be modified or reversed, and the case shall be remanded to the agency for disposition in accordance with the order of the court.

[¶ 8] Under N.D.C.C. § 28-32-49, this Court reviews a district court judgment under the standards provided by N.D.C.C. § 28-32-46. In our review, we decide whether the ALJ's findings are supported by a preponderance of the evidence, the conclusions of law are supported by the findings of fact, and the decision is in accordance with the law. Developmental Ctr. v. Central Pers. Div., 2000 ND 7, ¶ 9, 604 N.W.2d 230. In reviewing an ALJ's findings, we do not make independent findings of fact or substitute our judgment for that of the ALJ; rather, we determine whether a reasoning mind could have reasonably determined the factual conclusions were supported by the weight of the evidence. North Dakota Dep't. of Transp. v. Central Pers. Div., 1999 ND 198, ¶ 10, 600 N.W.2d 861.

III

[¶ 9] We initially consider whether the ALJ had jurisdiction to hear Ryan's appeal. The Department argues the ALJ did not have jurisdiction to hear Ryan's appeals under N.D. Admin. Code § 4-07-20.1-07, which, as relevant to this case, provides that a reduction-in-force appeal may be made only on the basis that the comparative criteria in N.D. Admin. Code § 4-07-11-03 were not followed. Ryan argues the ALJ properly construed the limitations on reduction-in-force appeals in N.D. Admin. Code § 4-07-20.1-07 to harmonize it with N.D.C.C. § 54-43.3-12.2, which authorizes the Division to "certify appeals from nonprobationary employees in the classified service which are related to ... reduction in force." He argues N.D. Admin. Code § 4-07-20.1-07 purports to restrict the scope of N.D.C.C. § 54-43.3-12.2, and an administrative regulation may not exceed an agency's authority under its enabling statute.

[¶ 10] Properly promulgated administrative rules have the force and effect of law. N.D.C.C. § 28-32-06. However, an administrative regulation is void if it exceeds an agency's statutory authority or conflicts with the statute it implements. State ex rel. Clayburgh v. American West Cmty. Promotions, Inc., 2002 ND 98, ¶ 13, 645 N.W.2d 196. In Moore v. North Dakota Workmen's Comp. Bureau, 374 N.W.2d 71, 74 (N.D.1985) (quoting Medical Props., Inc. v. North Dakota Bd. of Pharmacy, 80 N.W.2d 87, 90 (N.D.1956)), we explained:

"`Since the power to make regulations is administrative in nature, legislation may not be enacted under the guise of its exercise by issuing a "regulation" which is out of harmony with, or which alters, extends, or limits, the statute being administered, or which is inconsistent with the expression of the lawmakers' intent in other statutes. The administrative officer's power must be exercised within the framework of the provision bestowing regulatory powers on him and the policy of the statute which he administers. He cannot initiate policy in the true sense, but must...