Pavement Restorations Inc. v. Ralls
Decision Date | 17 February 2017 |
Docket Number | No. W2016-01179-COA-R3-CV,W2016-01179-COA-R3-CV |
Parties | PAVEMENT RESTORATIONS INC. v. THOMAS E. RALLS, ET AL. |
Court | Tennessee Court of Appeals |
Appeal from the Chancery Court for Gibson County
George R. Ellis, Chancellor
Employee's employment was terminated for smoking in a company truck in violation of the employer's rule. Employee's initial request for unemployment benefits was denied. The Appeals Tribunal affirmed the denial of benefits, but the Commissioner's Designee later reversed, finding that employee's conduct was exempt from the definition of misconduct and concluding that the employee was, therefore, not terminated for work-related misconduct as defined in the unemployment compensation statutes. On appeal to the chancery court, the trial court concluded that evidence in the record supported the Commissioner's Designee's decision. Discerning no error, we affirm.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed
Michael R. Hill, Milan, Tennessee, for the appellant, Pavement Restorations, Inc.
Herbert H. Slatery, III, Attorney General and Reporter; W. Derek Green, Assistant Attorney General for the appellees, Burns Phillips, Commissioner, Tennessee Department of Labor & Workforce Development.
OPINIONDefendant/Appellee Thomas E. Ralls ("Mr. Ralls") was employed as a field laborer with Pavement Restorations, Inc. ("Pavement Restorations") from September 28, 2011, until the termination of his employment on March 9, 2015. On March 16, 2015, Mr. Ralls filed a claim for unemployment benefits. The Defendant/Appellee Tennessee Department of Labor and Workforce Development ("the Department") rendered its initial decision on March 25, 2015, finding that Mr. Ralls had been discharged for work-related misconduct and was thus not entitled to receive unemployment benefits. On April 1, 2015, Mr. Ralls appealed the decision to the Department's Appeals Tribunal.
The hearing officer for the Appeals Tribunal conducted a telephonic hearing on April 22, 2015. Neither Mr. Ralls nor Pavement Restorations was represented by counsel during the hearing. Instead, Mr. Ralls appeared on his own behalf, and Pavement Restorations' president and co-owner, Jon Hargett, appeared on its behalf.
Mr. Hargett testified first, explaining that another co-owner1 noticed an employee smoking in the back of a company crew cab truck on the crew's return trip from a job site to the Pavement Restorations shop. According to Mr. Hargett, the co-owner informed him that "someone in the back seat" was smoking and requested that he "find out who was in that truck." Mr. Hargett's account thereafter is as follows:
And so, I called the - the foreman on the job that was driving the truck to find out who was sitting in the back seat. And so, that was - they were about five minutes from the office. When they got here and [Mr. Ralls] came inside, I told him I needed to talk to both of them and he came inside and said he was embarrassed that he - he had fallen asleep on the way home and when he woke up, he just pulled out a cigarette and lit up and had only taken a couple of puffs off of it and then threw it out. So, but that's against ou[r] policy. So, due to that and the previous instances of violations of things, that I did the separation notice based on that.
Mr. Hargett further clarified that the "previous instances of violations" referenced Mr. Ralls's four instances of tardiness in 2014. Mr. Hargett testified that Mr. Ralls was aware of the rules because they are located in the company handbook given to all employees and that employees are subject to termination upon even a single violation of any of the rules. Mr. Hargett added that Pavement Restorations had just discussed the no-smoking rule during an annual safety meeting only one month prior to the termination Mr. Ralls's employment.2
Mr. Ralls testified that he had received "verbal warnings maybe twice in one year." Although Mr. Ralls concedes that he was aware of the company's no-smoking policy in company vehicles, Mr. Ralls asserted that "everybody at the company smokes and they all smoke in the vehicle." According to Mr. Ralls's account:
Well, I had just woken up and that's just, you know, when you wake up, that's what I - what I did and then I remembered and I threw it out. We was almost to the shop because I'm not trying to smoke in the vehicles. I was usually awake the whole time, you know, and I wait till we get to where we're going or whatever, but I mean, I don't think it's misconduct.
On April 24, 2015, the Appeals Tribunal issued a written decision affirming the Department's decision. On May 14, 2015, Mr. Ralls appealed the decision to the Commissioner's Designee. On May 21, 2015, Mr. Hargett signed and returned an acknowledgment of appeal form wherein he indicated that Pavement Restorations did not "wish to have another hearing to present additional evidence." On June 1, 2015, the Commissioner's Designee reversed the Appeals Tribunal's decision, finding the following:
Based upon these facts, the Commissioner's Designee made the following conclusions of law:
As a result, the Commissioner's Designee concluded that Mr. Ralls was eligible for unemployment benefits under Tennessee Code Annotated section 50-7-303(a)(2).
Mr. Hargett, on Pavement Restorations' behalf, filed a petition to rehear the Commissioner's Designee's decision on June 10, 2015, claiming that the "facts [had] been distorted by [Mr. Ralls]" and describing additional evidence that was not introducedat the April 22, 2015 hearing. Specifically, Mr. Hargett asserted that the other co-owner witnessed Mr. Hargett smoking for a total of 4.7 miles before he disposed of the cigarette. The Commissioner's Designee denied Pavement Restorations' petition on June 16, 2015, noting that Pavement Restorations "ha[d] not explained why this information, if relevant, was not presented during the Appeals Tribunal hearing as required" and concluding that Pavement Restorations was "essentially requesting a second opportunity to meet its burden of proof."
On July 27, 2015, Pavement Restorations timely filed a petition for judicial review of the agency decision in the Gibson County Chancery Court. The trial court heard oral argument on Pavement Restorations' petition on April 18, 2016. By order of May 10, 2016, the trial court affirmed the Commissioner's Designee's decision, concluding that there was evidence in the record to support the findings of the Commissioner's Designee and a reasonable basis in law for its decision to award unemployment benefits to Mr. Ralls. This appeal followed.
Pavement Restorations raises two issues for review, which we have slightly restated, as follows:
Tennessee Code Annotated section 50-7-304(i) contains the standards by which chancery courts are to review administrative decisions involving claims for unemployment compensation. This Court employs the same standard of review applicable to the trial court. See Armstrong v. Neel, 725 S.W.2d 953, 955 & n.1 (Tenn. Ct. App. 1986). Tennessee Code Annotated section 50-7-304(i)(2) provides that:
The issue in this case concerns whether the agency's decision was supported by substantial and material evidence. Courts "generally interpret the substantial and material evidence requirement as requiring 'something less than a preponderance of the evidence, but more than a scintilla or glimmer.'" Dickson v. City of Memphis Civ. Serv. Comm'n, 194 S.W.3d 457, 464 (Tenn. Ct. App. 2005) (quoting Wayne Cnty. Tenn. Solid Waste Disposal Control Bd., 756 S.W.2d 274, 280 (Tenn. Ct. App. 1988) (citations omitted)). "Substantial evidence is not limited to direct evidence but may also include circumstantial evidence or the...
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