Rasmussen v. South Dakota Dept. of Labor

• Decision Date: 03 September 1993
• Docket Number: No. 18304,18304
• Citation: 510 N.W.2d 655
• Parties: Lloyd RASMUSSEN, Claimant and Appellant, v. SOUTH DAKOTA DEPARTMENT OF LABOR, Defendant and Appellee, and H & I Grain and Leasing, Employer and Appellee. . Considered on Briefs
• Court: South Dakota Supreme Court

Page 655

510 N.W.2d 655

Lloyd RASMUSSEN, Claimant and Appellant, v. SOUTH DAKOTA DEPARTMENT OF LABOR, Defendant and Appellee, and H & I Grain and Leasing, Employer and Appellee.

No. 18304.

Supreme Court of South Dakota.

Considered on Briefs Sept. 3, 1993.

Decided Dec. 29, 1993.

Eric N. Rasmussen of Erickson, Helsper & Rasmussen, Brookings, for claimant and appellant.

Ronald A. Wager of Bantz, Gosch, Cremer, Peterson & Oliver, Aberdeen, for employer and appellee H & I.

Drew C. Johnson, Sp. Asst. Atty. Gen., Aberdeen, for defendant and appellee State.

SABERS, Justice.

Lloyd Rasmussen (Rasmussen) appeals the circuit court's affirmance of the South Dakota Department of Labor's denial of his claim for unemployment insurance benefits. We reverse.

FACTS

Rasmussen was employed as a truck driver by H & I Grain and Leasing (H & I) for a little over four years. On or about December 12, 1991, Rasmussen was convicted of the offense of driving while under the influence of alcohol (DUI). According to the employer's hearing testimony, this was Rasmussen's second DUI conviction in a two or three year period. Because of the conviction, Rasmussen's driver's license was suspended for one year. However, Rasmussen was granted a work permit so that he could continue working and H & I did allow Rasmussen to continue driving trucks with his work permit.

As a result of new federal regulations, all commercial truck drivers must now possess a commercial driver's license (CDL). ¹ Those regulations took effect on April 1, 1992, during the period of the suspension of Rasmussen's driver's license. Rasmussen learned that he could not obtain a CDL because of the suspension and that he would not be able to qualify for a CDL until he obtained his driver's license after expiration of the period of suspension. Because Rasmussen could not obtain a CDL, H & I could not allow him to continue working as a truck driver. Therefore, Rasmussen's last day of employment as a truck driver was on March 31, 1992.

H & I offered Rasmussen continued employment operating a grinder. Therefore, after Rasmussen finished his work as a truck driver and took a few days off, he returned to work for H & I as a grinder operator. However, because of difficulties Rasmussen experienced with operating the grinder, he worked for only a few more days before finally leaving his employment with H & I.

Rasmussen filed his claim for unemployment insurance benefits on May 29, 1992, and his claim was denied. After an inter-departmental appeal and evidentiary hearing as well as an appeal to the Secretary of Labor, the Department of Labor denied Rasmussen's claim for benefits on the basis that he was discharged from his employment for work-connected misconduct.

Rasmussen appealed the final decision of the Department of Labor to the circuit court on September 14, 1992. On March 2, 1993, the circuit court entered its judgment and order affirming the department's denial of benefits and adopting the department's findings of fact and conclusions of law. Rasmussen appeals.

ISSUE 1

WAS RASMUSSEN DISCHARGED FROM HIS EMPLOYMENT FOR MISCONDUCT THAT DISQUALIFIES HIM FROM RECEIVING UNEMPLOYMENT INSURANCE BENEFITS?

The unemployment insurance law provides for a disqualification from the receipt of unemployment insurance benefits for individuals discharged from their employment for misconduct connected with their work. The pertinent statute is SDCL 61-6-14 which provides in part:

An unemployed individual who was discharged or suspended from his most recent employment ... for misconduct connected with his work shall be denied benefits until he has been reemployed at least six calendar weeks in insured employment during his current benefit year and earned wages of not less than his weekly benefit amount in each of those six weeks. (emphasis added).

"Misconduct" is statutorily defined at SDCL 61-6-14.1:

As used in this chapter, misconduct is:

(1) Failure to obey orders, rules or instructions, or failure to discharge the duties for which an individual was employed; or

(2) Substantial disregard of the employer's interests or of the employee's duties and obligations to his employer; or

(3) Conduct evincing such willful or wanton disregard of an employer's interests as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect of his employee; or

(4) Carelessness or negligence of such degree or recurrence as to manifest equal culpability or wrongful intent.

However, mere inefficiency, unsatisfactory conduct, failure to perform as the result of inability or incapacity, a good faith error in judgment or discretion, or conduct mandated by a religious belief which belief cannot be reasonably accommodated by the employer is not misconduct.

Rasmussen contends that the Department of Labor and circuit court erred as a matter of law in holding that his discharge for off-duty conduct (i.e., his DUI) was a discharge for work-connected misconduct that disqualifies him from receiving unemployment insurance benefits. He argues that for his employer to have prevailed on such a claim, it was incumbent for his employer to show that he committed his DUI with the specific knowledge that the employer's interests would suffer. Rasmussen asserts that it was impossible for H & I to make such a showing in this case because, in August of 1991, when he committed his DUI offense, it was impossible for him to know that his employer's interests would suffer because the DUI would eventually disqualify him from receiving a CDL.

In unemployment insurance appeals, "[w]hen the issue is a question of law, the decisions of the administrative agency and the circuit court are fully reviewable. When the issue is a question of fact, we ascertain whether the administrative agency was clearly erroneous." Matter of Kotrba, 418 N.W.2d 313, 314-15 (S.D.1988). Whether an individual has been discharged from his employment for misconduct that disqualifies him from receiving unemployment insurance benefits is a question of law and is, therefore, fully reviewable by this Court. See, Kotrba, supra. See also, Markel v. City of Circle Pines, 479 N.W.2d 382 (Minn.1992).

In Kotrba, supra, this Court set forth the test for determining whether off-duty conduct resulting in loss of employment constitutes work-connected misconduct disqualifying an individual from receiving unemployment insurance benefits.

[I]n order to establish misconduct connected with an employee's work as required by [statute] the employer must show by a preponderance of the evidence that a reasonable person would find the employee's conduct: (1) had some nexus with the employee's work; (2) resulted in some harm to the employer's interests; and (3) was in fact conduct which was (a) violative of some code of behavior contracted for between employer and employee, and (b) done with intent or knowledge that the employer's interest would suffer.

Kotrba, 418 N.W.2d at 316 (quoting Nelson v. Department of Employment Security, 98 Wash.2d 370, 655 P.2d 242, 245 (1982)).

Applying this test in the instant case, Rasmussen was indisputably an employee whose ability to perform his job depended on his having a valid driver's license and obtaining a CDL. As a result, any conduct of Rasmussen's that jeopardized his driver's license and ability to obtain a CDL would have a nexus with his work by affecting his ability to perform his job. Rasmussen's voluntary conduct in driving drunk and putting at risk his driver's license and ability to obtain a CDL obviously harmed his employer's interest in retaining employees capable of performing the work they are hired to do. Because Rasmussen was specifically hired as a truck driver, it is apparent that, even in the absence of any express understanding, his employer was entitled to a legitimate expectation that Rasmussen would take all steps reasonable and necessary to maintenance and protection of his driving privileges and ability to perform his work as a truck driver.

It follows from the above that Rasmussen's voluntary conduct in driving drunk and jeopardizing his driving privileges was a knowing and substantial disregard of an obligation he owed his employer. Or, put in terms of the Kotrba test, it was conduct that violated a code of behavior contracted for between the employer and Rasmussen and was done with knowledge that the employer's interests would suffer. This is particularly true in view of the fact that Rasmussen had a prior DUI conviction and must have understood the risk to his driving privileges he was undertaking by driving drunk. Moreover, the CDL requirements had been well known by the trucking industry for about two years.

Based upon the above analysis, despite the fact Rasmussen's DUI was off-duty conduct, it was, nevertheless, misconduct connected with his work as contemplated by the unemployment insurance law. His discharge for that misconduct would, therefore, disqualify him from the receipt of unemployment insurance benefits. Such was the similar conclusion of the Minnesota Supreme Court in Markel, supra. The unemployment insurance claimant in Markel was employed by a municipality. His job duties required driving the city's vehicles. The claimant was convicted of a DUI committed in his off-duty hours and was ultimately dismissed from his employment. In determining whether the claimant's dismissal was for work-connected misconduct that should disqualify him from the receipt of unemployment insurance benefits, the Minnesota Supreme Court concluded:

We ... hold that conduct which results in the loss of a license necessary for the performance of normal job duties is misconduct, within the meaning of [Tilseth v. Midwest Lumber Co., 295 Minn. 372, 204 N.W.2d 644 (1973) ². As an employee whose ability to perform his job depended on his having a valid driver's license, Markel's behavior--drinking and driving--simply does not come within the Tilseth exceptions for...