Petrovic v. Dep't of Emp't Sec.

• Decision Date: 04 February 2016
• Docket Number: No. 118562.,118562.
• Citation: 401 Ill.Dec. 895,51 N.E.3d 726
• Parties: Zlata PETROVIC, Appellant, v. The DEPARTMENT OF EMPLOYMENT SECURITY et al., Appellees.
• Court: Illinois Supreme Court

51 N.E.3d 726

401 Ill.Dec. 895

Zlata PETROVIC, Appellant

v.The DEPARTMENT OF EMPLOYMENT SECURITY et al., Appellees.

No. 118562.

Supreme Court of Illinois.

Feb. 4, 2016.

Modified upon denial of rehearing May 23, 2016.

Timothy Huizenga and Miriam V. Hallbauer, both of Legal Assistance Foundation, of Chicago, for appellant.

Lisa Madigan, Attorney General, of Springfield (Carolyn E. Shapiro, Solicitor General, and Nadine J. Wichern, Assistant Attorney General, of Chicago, of counsel), for appellees.

OPINION

Justice BURKE delivered the judgment of the court, with opinion.

¶ 1 The plaintiff, Zlata Petrovic, applied for unemployment insurance benefits with the Department of Employment Security (Department) following the termination of her employment with American Airlines (American). American filed a protest alleging that plaintiff was ineligible for benefits because she was “discharged for misconduct connected with [her] work,” pursuant to section 602(A) of the Unemployment Insurance Act (Act) (820 ILCS 405/ 602(A) (West 2012)). Following a hearing, a referee for the Department denied plaintiff's application. The referee's determination was affirmed by the Board of Review (Board). Plaintiff filed a complaint for administrative review in the circuit court. The circuit court of Cook County reversed the Board's decision, finding that the actions which led to plaintiff's discharge did not constitute “misconduct” under the strict statutory definition in section 602(A). Thus, according to the circuit court, plaintiff was entitled to unemployment benefits. On appeal, the appellate court reversed the circuit court. 2014 IL App (1st) 131813, 385 Ill.Dec. 612, 19 N.E.3d 170.

¶ 2 In this court, plaintiff contends that the Board's decision finding her ineligible for benefits is clearly erroneous. We agree. For the reasons that follow, we reverse the judgment of the appellate court and affirm the judgment of the circuit court.

¶ 3 BACKGROUND

¶ 4 Plaintiff was employed by American from June 6, 1988, to January 24, 2012. On January 1, 2012, plaintiff was working as a tower planner at O'Hare International Airport. Plaintiff received a call from a friend at another airline. The friend asked plaintiff whether she could do something for a passenger who was scheduled to fly on American. Plaintiff requested that the catering department deliver a bottle of champagne to the passenger. She then asked a flight attendant whether it would be possible to upgrade the passenger. The passenger in question was upgraded from business class to first class.

¶ 5 On January 24, 2012, plaintiff was advised that her employment was terminated because she upgraded the passenger and requested the champagne without proper authorization. The termination letter in the record states that plaintiff's actions violated two express policies governing American employees. These policies, referred to as rule Nos. 16 and 34, are set forth in the letter as follows:

“Rule # 16: ‘Misrepresentation of facts or falsification of records is prohibited.’

Rule # 34: ‘Dishonesty of any kind in relations [sic ] to the Company, such as theft or pilferage of Company property, the property of other employees or property of others entrusted to the Company, or misrepresentation in obtaining employee benefits or privileges will be grounds for dismissal and where the facts warrant, prosecution to the fullest extent of the law. Employees charged with a criminal offense on or off duty may be immediately withheld from service. Any action constituting a criminal offense, whether committed on or off duty, will be grounds for dismissal.’ ”

¶ 6 Plaintiff subsequently applied to the Department for unemployment benefits. American filed a protest alleging that plaintiff was discharged because she “left her work area without her manager's approval to secure an undocumented upgrade for a friend of a friend.” According to American, plaintiff's conduct violated a “reasonable and known policy.” The protest does not refer to rule Nos. 16 and 34. Instead, it alleges that “[o]nly authorized employees may issue an upgrade[,] and employees are expected to remain in their work area during the course of their shift unless given permission by their manager to leave. The claimant was made aware of this policy through PC [personal computer] based training.”

¶ 7 A claims adjudicator denied benefits to plaintiff on the ground that she was discharged for misconduct connected with her work. Plaintiff appealed, and a Department referee conducted a telephone hearing. Plaintiff's supervisor, Robert Cumley, testified that he had no personal knowledge of the incident leading to plaintiff's termination. He stated generally that “[p]olicies and procedures were not followed” and that “questions were asked of the wrong people” about moving the passenger. When the referee asked Cumley to describe plaintiff's involvement in upgrading the passenger, he replied, “making the request and most likely moving the passenger, uh, circumventing the policy and procedures of having management, uh, approval to do so.” Cumley testified that the upgrade caused a loss of revenue to American in the amount of $7,100. He also testified that moving a passenger to a different seat could affect the balance and weight numbers for the aircraft.

¶ 8 Plaintiff testified that a friend from another airline asked whether she could do something for a passenger on an American flight. She told him that she “could probably help with a bottle of champagne or maybe ask for an upgrade.” Plaintiff asked the catering department to send a bottle of champagne to the plane for the passenger. The catering employees “didn't say no, we don't do this anymore.” Plaintiff testified that, in her previous job working with customers in American's international department, she and acquaintances from other airlines would do favors for each other, such as helping passengers with connections. Referring to the champagne, she testified that “we used to do these things in the past.” After requesting the champagne, plaintiff boarded the aircraft and asked the flight attendant if it would be possible to upgrade the passenger. The flight attendant said, “[o]h, no problem.” Plaintiff informed the gate agent that the upgrade “might happen” and left the area without learning whether the passenger was upgraded. Plaintiff testified that none of the employees with whom she spoke informed her that her requests could not be granted. She stated that she was not aware of any rule or policy requiring a manager to approve requests for special treatment for a passenger.

¶ 9 Following the telephone hearing, the referee affirmed the denial of unemployment benefits due to misconduct under section 602(A) of the Act. The referee made no finding that plaintiff violated an express rule or policy of the employer. Rather, the referee concluded that “there are some acts of misconduct that are so serious and so commonly accepted as wrong that employers need not have rules covering them,” and “[i]n this case, the claimant's action in giving away the employer's champagne and a free upgrade to first class was unacceptable by any standard.” Finally, the referee found that plaintiff's conduct harmed American because it resulted in a financial loss to the company.

¶ 10 Plaintiff appealed the referee's decision to the Board, which affirmed the determination of ineligibility for unemployment benefits. The Board incorporated the entirety of the referee's decision as part of its decision and made no additional findings of fact or conclusions of law. On administrative review, the circuit court reversed the Board's decision and found that plaintiff was eligible for benefits. The court held that American failed to provide proof that plaintiff violated an express rule or policy. In the absence of an express rule, plaintiff could not have known that her requests for special treatment for a passenger were forbidden. Thus, the court concluded, plaintiff's actions did not amount to “misconduct” under the disqualifying provision in section 602(A).

¶ 11 The Department, the Board, and the Director of Employment Security (collectively, the State defendants) appealed. The appellate court reversed the circuit court's judgment and reinstated the Board's order denying benefits. 2014 IL App (1st) 131813, 385 Ill.Dec. 612, 19 N.E.3d 170. The appellate court held that plaintiff “sought an upgrade for a friend of a friend without management authorization or payment” and “caused a $7,100 upgrade to first class to be issued without management approval.” Id. ¶¶ 30, 33. According to the court, plaintiff's actions violated an American policy that only authorized employees may issue upgrades. Id. ¶ 30. The court thus upheld the Board's finding that plaintiff was terminated for misconduct. Id. ¶ 33.

¶ 12 This court allowed plaintiff's petition for leave to appeal. Ill. S.Ct. R. 315(a) (eff. Jan. 1, 2015).

¶ 13 ANALYSIS

¶ 14 I. State Defendants' Standing

¶ 15 At the outset, plaintiff argues that the State defendants had no standing to appeal the circuit court's judgment reversing the Board's denial of benefits. The State defendants were the only appellants because American did not participate in the appeal. Relying on Speck v. Zoning Board of Appeals, 89 Ill.2d 482, 60 Ill.Dec. 643, 433 N.E.2d 685 (1982), plaintiff argues that the State defendants function solely in an adjudicatory or quasi-judicial capacity, which limits their capacity to appeal adverse decisions.

¶ 16 In Speck, this court held that an administrative body whose statutory charge is to “function in an adjudicatory or quasijudicial capacity” lacks standing to appeal a circuit court's reversal of its own decision on administrative review. Id. at 485, 60 Ill.Dec. 643, 433 N.E.2d 685. We held that the ordinance empowering a municipal zoning board to decide applications and appeals did not specifically authorize it to “assume the role of advocate for the purpose of prosecuting an appeal.” Id.

The...