Boothe v. Director

James E. BOOTHE v. DIRECTOR, 
Employment Security Department

E 97-36                                            ___ S.W.2d ___

                  Court of Appeals of Arkansas
                          Division III
               Opinion delivered November 12, 1997


1.   Unemployment compensation -- standard of review. -- On review of
     unemployment compensation cases, the factual findings of the
     Board of Review are conclusive if they are supported by
     substantial evidence; but that is not to say that the
     appellate court's function is merely to ratify whatever
     decision has been made by the Board of Review; the appellate
     court is not at liberty to ignore its responsibility to
     determine whether the standard of review has been met; when
     the Board's decision is not supported by substantial evidence,
     the appellate court will reverse.

2.   Evidence -- substantial evidence defined. -- Substantial evidence is
     such relevant evidence as a reasonable mind might accept as
     adequate to support a conclusion.

3.   Unemployment compensation -- preservation of job rights -- reasonable
     efforts required. -- Arkansas Code Annotated section 11-10-513(b)
     (Repl. 1996) provides that, as a prerequisite to receiving
     unemployment benefits, an employee is required to make every
     reasonable effort to preserve his job rights before leaving
     employment, and such reasonable efforts include taking
     appropriate measures to prevent an unsatisfactory situation on
     the job from continuing.

4.   Unemployment compensation -- preservation of job rights -- futile gesture
     not required. -- An employee is not required to take measures to
     resolve a problem with his employer if such measures would
     constitute nothing more than a futile gesture.

5.   Unemployment compensation -- sexual harassment -- good cause for voluntary
     termination of employment. -- Sexual harassment by her supervisor
     has been held to be good cause for an employee to voluntarily
     terminate her employment.

6.   Unemployment compensation -- sexual harassment -- good cause also extended
     to husband of victim. -- Where there was no question that
     appellant's wife, who had been subjected to sexual harassment
     by her employer, had good cause to resign and that she was
     entitled to receive unemployment benefits, the appellate court
     held that, under the circumstances of the case, such good
     cause also extended to the husband of the victim of the sexual
     harassment; the matter was reversed and remanded.


     Appeal from the Arkansas Board of Review; reversed and
remanded.
     Sara Sawyer, for appellant; no brief filed.
     Phyllis Edwards, for appellee; no brief filed.

     John F. Stroud, Jr., Judge.
     Appellant James E. Boothe appeals a decision of the Board of
Review denying him unemployment compensation benefits in accordance
with Ark. Code Ann.  11-10-513 (Repl. 1996) upon a finding that
appellant left his employment without good cause connected with his
work and without making reasonable efforts to  preserve his job
rights.  The Boardþs decision reversed the Appeal Tribunalþs
finding that appellant had good cause for quitting his job. 
Appellant argues that the Boardþs decision is not supported by
substantial evidence.  We agree and reverse and remand to the Board
of Review to award appellant benefits.
     On review of unemployment compensation cases, the factual
findings of the Board of Review are conclusive if they are
supported by substantial evidence; but that is not to say that our
function on appeal is merely to ratify whatever decision is made by
the Board of Review.  See Shipley Baking Co. v. Stiles, 17 Ark.
App. 72, 703 S.W.2d 465 (1986).  As we said in Shipley, "We are not
at liberty to ignore our responsibility to determine whether the
standard of review has been met."  17 Ark. App. at 74, 703 S.W.2d 
at 467.  When the Board's decision is not supported by substantial
evidence, we will reverse.  Sadler v. Stiles, 22 Ark. App. 117, 735 S.W.2d 708 (1987).  Substantial evidence is such relevant evidence
as a reasonable mind might accept as adequate to support a
conclusion.  Victor Industries Corp. v. Daniels, 1 Ark. App. 6, 611 S.W.2d 794 (1981).
     Appellant had been employed as a mechanic at the Coast to
Coast Store in Dumas since March 11, 1992, and his wife, Darlene
Boothe, had been employed as a secretary there for between nine and
ten years.  The Dumas Coast to Coast store is a family business
that is owned by Mr. and Mrs. James Berry, and their son, Tommy
Berry.  
     Evidence was produced at the hearing that for a period of
several months before she quit working for Coast to Coast, Darlene
Boothe had been the victim of overt acts of sexual harassment by
James Berry during working hours, including touching her breasts
and patting her buttocks, suggesting that she help him use the
bathroom because his hands were dirty, and making other
inappropriate remarks with sexual innuendo. 
     Darlene testified that she asked James Berry to discontinue
this unacceptable conduct and that he apologized to her, but the
harassment continued.  Finally one day when James Berry made a
gesture and comment about how good it would feel to put his hands
between her legs, Darlene became so nervous and upset that she had
to leave the store.  As a result of the harassment, Darlene decided
to resign.  However, before resigning, she discussed the situation
with James Berry, who again apologized for his behavior, and who
agreed that the store would not contest her claim for unemployment
benefits.  She resigned and received unemployment benefits.
     Shortly before Darleneþs resignation, she informed her
husband, the appellant, about the sexual harassment that had been
directed toward her by James Berry.  Appellant contacted a private
detective, and a plan was conceived to fit Darlene with a body
microphone and for Darlene to engage James Berry in a recorded
conversation in an attempt to get him to admit that he had been
engaging in a course of sexual harassment toward Darlene.  The plan
was carried out, and, during the course of their conversation,
James Berry made incriminating statements to Darlene about his
sexual advances toward her.
     Rather than confront James or Tommy Berry about the problem,
appellant requested a one-week vacation and never returned to work
for Coast to Coast.  Appellant filed a claim for unemployment
benefits, contending that he resigned because of the sexual
harassment inflicted upon his wife by James Berry.
     Appellantþs application was denied by the Employment Security
Department because of his failure to submit proof in support of his
allegation that James Berry had harassed his wife.  Appellant
appealed the denial and, following a hearing at which the tape
recording of Darleneþs conversation with James Berry was introduced
as evidence, the Appeal Tribunal held that under the same or
similar circumstances, the average able-bodied worker would quit
rather than continue to work for an employer that condoned the
sexual harassment of his wife.
     Evidence introduced at the hearing also revealed that after
Tommy Berry learned about the charges of sexual harassment against
his father, his investigation consisted of merely asking his father
if the charges were true, receiving his fatherþs negative response,
and thereafter ignoring the accusations.  The Appeal Tribunal
decided that appellant voluntarily left his employment at Coast to
Coast for good cause connected with his work, and benefits were
awarded.  
     The Board of Review reversed the decision of the Appeal
Tribunal, holding that appellant had voluntarily left his
employment without good cause connected with his work and that
because he had not reported the harassment to the storeþs manager,
Tommy Berry, he had not taken reasonable steps to preserve his
employment.  In its decision, the Board stated that Tommy Berry
lacked incentive to investigate the allegations of sexual
harassment further because when he learned about them appellant and
his wife had already resigned.
     Evidence adduced at the hearing revealed that the corporate
stock of Dumas Coast to Coast was owned 34% by James Berry, and 33%
each by Tommy Berry and his mother.  Although Tommy Berry testified
that he was the store manager, that he was James Berryþs
supervisor, and that he would fire James Berry if circumstances
called for it, other witnesses testified that James Berry and Tommy
Berry equally shared in the responsibility of supervising the
storeþs employees; that tax records, business cards, and
correspondence of the corporation identified both James Berry and
Tommy Berry as owners and managers; that James and Tommy
participated equally in the supervision of employees; that Tommy
never overruled Jamesþs supervisory decisions; and that both were
consulted by employees about matters relating to things such as
vacations.  It was not disputed that James Berry alone authorized
Darlene Boothe to voluntarily resign her employment and receive
unemployment compensation benefits.  This action is consistent with
his role as manager and co-owner.
     The Board of Review held that the evidence did not show that
reporting the problem to Tommy Berry would have been an act of
futility.  We disagree.  The best evidence of what Tommy Berry
would have done to solve the problem had it been brought to his
attention sooner is provided by his own testimony of what he
actually did when he learned about the harassment allegation, i.e.,
he ignored it.  He testified that he knew there was a tape
recording of his father and Mrs. Boothe but he did not listen to it
"[b]ecause it... that's a private matter.  That's, that doesn't
have anything to do with me personally.  It's an accusation that
hasn't really been proved."  
     Appellant and his wife were justified in believing that
reporting the sexual harassment to the perpetratorþs son would be
futile.  This conclusion is supported not only by what Tommy Berry
actually did (or, more accurately, what he did not do) when he
learned of the problem, but by appellantþs justifiable belief that
James Berry, as a co-owner of the business, was just as much of a
supervisor and manager of the business as was Tommy Berry, and the
unrealistic prospect that James Berry would be fired or seriously
disciplined by his son.  
     Arkansas Code Annotated section 11-10-513(b) (Repl. 1996)
provides that, as a prerequisite to receiving unemployment
benefits, an employee is required to make every reasonable effort
to preserve his job rights before leaving employment, Ahrends v.
Director, 55 Ark. App. 71, 930 S.W.2d 392 (1996), and such
reasonable efforts include taking appropriate measures to prevent
an unsatisfactory situation on the job from continuing.  Teel v.
Daniels, 270 Ark. 766, 606 S.W.2d 151 (Ark. App. 1980).  But an
employee is not required to take measures to resolve a problem with
his employer if such measures would constitute nothing more than a
futile gesture. Oxford v. Daniels, 2 Ark. App. 200, 618 S.W.2d 171
(1981).  Sexual harassment by her supervisor has been held to be
good cause for an employee to voluntarily terminate her employment. 
McEwen v. Everett, 6 Ark. App. 32, 637 S.W.2d 617 (1982).  There is
no question but that Darlene Boothe had good cause to resign and
that she was entitled to receive unemployment benefits.  Under the
circumstances shown by the evidence in this case, we hold that such
good cause also extends to the husband of the victim of the sexual
harassment.
     Reversed and remanded.
     Bird and Griffen, JJ., agree.