Vanderburg v. NC Dept. of Revenue

• Decision Date: 01 March 2005
• Docket Number: No. COA04-554.,COA04-554.
• Citation: 608 S.E.2d 831,168 NC App. 598
• Parties: Michael H. VANDERBURG, Petitioner, v. NC DEPARTMENT OF REVENUE, Respondent.
• Court: North Carolina Court of Appeals

608 S.E.2d 831

168 NC App. 598

Michael H. VANDERBURG, Petitioner, v. NC DEPARTMENT OF REVENUE, Respondent.

No. COA04-554.

Court of Appeals of North Carolina.

March 1, 2005.

Ferguson, Stein Chambers, Adkins, Gresham & Sumter, P.A., by John W. Gresham, Charlotte, for petitioner-appellee.

Attorney General Roy Cooper, by Special Deputy Attorney General George W. Boylan and Assistant Attorney General Michael D. Youth, for respondent-appellant. TYSON, Judge.

The North Carolina Department of Revenue ("NCDOR") appeals an order affirming the Final Agency Decision of the State Personnel Commission ("the Commission"). The Commission adopted the recommended decision of the Administrative Law Judge ("ALJ") that overturned the dismissal of Michael H. Vanderburg ("Vanderburg") and reinstated him to his former position. We affirm.

I. Background

Vanderburg was employed with the NCDOR in January 1999 as a Revenue Officer Trainee under a two-year probationary period. Vanderburg was initially assigned to the Charlotte Revenue Office under the supervision of Martha Calhoun ("Calhoun"). On 27 May 1999, Calhoun met with Vanderburg and reviewed his performance from January through April 1999. He received "good" and "very good" ratings in all categories. Calhoun noted that Vanderburg was "thorough in his follow-up and investigation of taxpayers and very good in following departmental policies." Calhoun concluded by stating Vanderburg "handles himself in a professional manner and is respectful of his co-workers and the public."

Shortly after this review, Vanderburg accepted a position with a church as an associate pastor. He subsequently completed and submitted a NCDOR form entitled "Request for Secondary Employment." The request was approved by the NCDOR's Assistant Secretary, Dewey Sanders ("Sanders"), on 29 June 1999. Vanderburg continued to maintain his workload after starting his pastorship.

On 1 July 1999, Vanderburg was reassigned to work under the supervision of Dean Barnes ("Barnes"). On 22 July 1999, Vanderburg met with Barnes and Chris Pappas ("Pappas"), Office Manager for the Collections Division in Charlotte. Barnes and Pappas told Vanderburg that they had received two anonymous complaints that religious materials displayed in his work cubicle were offensive. Vanderburg was ordered to remove all religious items from his walls and the screen saver from his computer. Barnes also stated that he was concerned with Vanderburg's associate pastor position. Although Vanderburg was ordered to remove personal religious items from his cubicle, other employees continued to display materials in their cubicles with religious themes.

On 23 July 1999, Pappas approached Vanderburg's father, an auditor with the NCDOR. Pappas confirmed that he directed Vanderburg to remove all personal materials from his cubicle. Vanderburg's father advised Pappas that Vanderburg had drafted a letter to be forwarded to Sanders. Pappas became agitated. He referred to Vanderburg's cubicle as a "shrine" and indicated that since Vanderburg was still in training, he could "just fire him right now." Pappas conceded that Vanderburg did "real good work" and worked "very hard."

Pappas met with Vanderburg to discuss their earlier meeting. Vanderburg gave Pappas his letter to Sanders, which Pappas set aside. He told Vanderburg that there may have been a misunderstanding about the directive to remove all personal items from his cubicle. Pappas explained he only meant for a newspaper article and lighthouse to be removed. Vanderburg immediately removed the items. Pappas then advised Vanderburg that there was no need to send his letter to Sanders, as there would be no repercussions or retaliation. Vanderburg agreed, but asked Pappas to place the letter to Sanders in his personnel file.

Vanderburg's caseload increased substantially in August 1999 after the meetings with Barnes and Pappas. The NCDOR acknowledged that it would periodically equalize caseloads among its employees. However, no such equalization was made that August. Despite the expanded caseload, Vanderburg was able to significantly reduce pending cases by the end of September 1999.

On 18 November 1999, Barnes performed an interim performance review of Vanderburg. The review asserted that Vanderburg had priority cases in his caseload "which need work or follow-up." The interim review did not reference the unusual increase in Vanderburg's caseload in August 1999, the non-equalization of Vanderburg's cases, or his positive efforts in reducing his caseload that Fall.

On 19 November 1999, Vanderburg met with Pappas and Ralph Foster ("Foster"), Pappas's superior and Director of the Western Collection Division. In the meeting, Foster commented that he had "specific concerns" about Vanderburg's future with the NCDOR. An argument ensued and Foster called Vanderburg a "smart ass" and a "smart butt." Vanderburg requested transfer to the Gastonia branch.

Vanderburg's last day of work in the Charlotte office was 24 November 1999. That day, Pappas informed Vanderburg that he would not receive an annual raise. Vanderburg sent a letter to Sanders in late November 1999 detailing the events that had occurred from July 1999 forward, including Foster's behavior on 19 November 1999.

Foster met with Vanderburg again in December 1999 after he was transferred to Gastonia. Foster stated that Vanderburg could be "fired at anytime." He also showed Vanderburg a copy of his November letter to Sanders and stated, "what do you think you were doing; you really messed up now; do you think Dewey Sanders would listen to you." Foster ended the meeting by telling Vanderburg that he was waiting for the opportunity to dismiss him. In Gastonia, Vanderburg was initially assigned personal income tax cases. On 1 June 2000, Vanderburg received an annual review. His supervisors, Libby McAteer ("McAteer") and J.B. Williams ("Williams") stated they were pleased and that Vanderburg was doing a great job. The written review ended with the comment, "keep up the good work."

Vanderburg was assigned to the business tax division in June 2000. His immediate supervisors described him as very helpful, frequently checking with his supervisor, and working very hard to reduce the territory's caseload.

In September 2000, the NCDOR reorganized the Collections Division. Robie McLamb ("McLamb") became the Director of Collections for the State. On 23 October 2000, McLamb met with McAteer and Williams to discuss Vanderburg's employment. He explained that Vanderburg was behind on his caseload and appeared to not be performing his duties. McAteer and Williams explained to McLamb that Vanderburg's large caseload was due to him inheriting the largest territory in Gastonia with a four-month backlog. Despite McAteer and Williams speaking favorably of Vanderburg, McLamb told them Vanderburg would be dismissed.

On 24 October 2000, McLamb met with Vanderburg and expressed several concerns. McLamb first pointed to the large number of pending cases in Vanderburg's territory as an issue. McLamb also stated that he had heard that Vanderburg had trouble getting along with people in authority. McLamb further mentioned that Pappas had a problem with Vanderburg.

On 9 November 2000, Vanderburg filed a pro se petition with the Office of Administrative Hearings ("OAH") alleging that he was threatened with dismissal for poor performance despite his history of positive performance reviews.

Vanderburg met with McLamb on 9 November 2000. Vanderburg explained that he filed a petition with the OAH. McLamb informed Vanderburg that he would not be retained beyond the probationary period. Vanderburg was provided two weeks severance.

Vanderburg filed a second petition on 6 December 2000 alleging violations of rights protected by N.C. Gen.Stat. § 126-36. On 18 December 2000, the OAH consolidated the petitions. Vanderburg and the NCDOR filed prehearing statements. The NCDOR's prehearing statement acknowledged that the governing statute in the case was N.C. Gen.Stat. § 126-36 and that the issue to be resolved was whether Vanderburg's termination during his probationary period arose from either discrimination based on his religious practices and/or retaliation for his opposition to alleged discrimination.

On 31 December 2001, the ALJ found that: (1) Vanderburg proffered substantial evidence to show he was dismissed in violation of his protected rights; (2) the NCDOR's proffered reason for dismissing Vanderburg was "not worthy of belief;" and (3) Vanderburg's termination was retaliatory due to his "protest against what he believed to be encroachment by [the NCDOR] on his protected rights of religious expression." The ALJ recommended Vanderburg be reinstated as a permanent employee within the NCDOR with full benefits.

Following a whole record review, the Commission adopted the ALJ's recommendation. Under N.C. Gen.Stat. § 150B-45, the NCDOR appealed to Wake County Superior Court. Both parties submitted proposed recommended decisions to the trial court for review. The trial court's order stated it "reviewed the petition, the record filed by [Vanderburg], and the submissions by counsel for both [parties] ... heard extensive argument of counsel," and affirmed the Commission's decision. The NCDOR appeals.

II. Issues

The issues are whether: (1) the Commission has jurisdiction over an appeal from a case filed by a probationary employee of the NCDOR; and (2) the trial court properly reviewed and affirmed the Commission's order.

III. Subject Matter Jurisdiction

The NCDOR contends Vanderburg, as a probationary non-career employee, may not avail himself to the protections of the statutes and procedures before the Commission concerning alleged discriminatory practices. We disagree.

A. N.C. Gen.Stat. § 126-1 et seq.

N.C. Gen.Stat. § 126-1 et seq. govern the State Personnel System. It includes the appeals process for claims involving unlawful employment practices by State agencies. Not...