Delta Plastics, Inc. v. Director, Employment Security Department and Kenneth G. Roach

ARKANSAS COURT OF APPEALS

NOT DESIGNATED FOR PUBLICATION

WENDELL L. GRIFFEN, JUDGE

DIVISION IV

E02-115

February 19, 2003

DELTA PLASTICS, INC. AN APPEAL FROM ARKANSAS

APPELLANT BOARD OF REVIEW [No. 02-BR-464]

V.

DIRECTOR, ARKANSAS

EMPLOYMENT SECURITY DEPT.

and KENNETH G. ROACH

APPELLEES AFFIRMED

Appellant, Delta Plastics, Inc., challenges the Arkansas Board of Review's decision granting unemployment compensation benefits to Kenneth Roach. Appellant contends that Roach knowingly violated a documented company policy, which constituted misconduct in connection with the work sufficient to support a denial of benefits, and thus, the Board's decision was not supported by substantial evidence. We disagree and affirm the award of benefits.

Roach had worked for appellant for a little more than three years as a truck driver and forklift operator. Appellant asserts that Roach knowingly violated the company policy that an employee is to "clock in and out" upon arrival and departure from the work premises. Appellant's specific allegation is that on October 26, 2001, Roach left the work premises atabout 9:00 a.m. and returned at 10:15 a.m., and did not clock out when he left nor clock back in when he returned. Thus, Roach was discharged from his job for violating this policy. Roach filed a claim for unemployment benefits with the Employment Security Department, which was denied. Roach appealed to the Appeal Tribunal, which reversed the Department's decision and awarded benefits. The Board of Review affirmed the award of benefits.

At the hearing, Kelly Massey, appellant's personnel manager, testified that Delta Plastics, Inc. had a company policy that employees were to clock out before leaving the workplace, and that Roach was discharged from work because he left the premises on October 26, 2001, at approximately 9:00 a.m. for an hour and fifteen minutes without clocking out. Massey also mentioned that later the same day, Roach again left the premises without clocking out. However, Massey admitted that Roach told him that he was leaving the premises the first time, and that he gave Roach permission to leave as long as Roach notified his supervisor. Massey further testified that Roach had been verbally warned about previous violations of this policy and that Roach's time sheets revealed that he had not clocked out for his breaks in more than four months.

Bud Miller was appellant's plant manager and had been in the position less than one year. He testified that it was a standard policy of the company to terminate an employee who left the premises without clocking out, although Roach was the first employee to be fired for doing so. Although Roach failed to clock out when he left the work premises, Miller knew that Massey had given Roach permission to leave work that day.

Roach testified that on October 26, 2001, he left work at 9:00 a.m. to pay a bill, andinformed both his acting supervisor and Massey that he was leaving. Roach said that he told the acting supervisor and Massey that he would let them know when he returned. Roach admitted not clocking out when he left even though he knew that it was company policy to do so. Roach, however, claimed that when he returned to work around 10:00 a.m., he went to Massey's office to let him know that he was back, but Massey was not there. According to Roach, he immediately informed his supervisor of his return. Roach mentioned that he did not think there would be any problems because over the three-year-period he had been with the company, he had left the premises probably seven to eight times without clocking out. Roach claimed that on the occasions he left work without clocking out, he would inform his regular supervisor and his supervisor always would say that "he'd take care of it."

Kenneth Ballard, a former employee of appellant, testified that he had worked at the company for about ninety days before being incarcerated and subsequently terminated in 2001. However, while he was employed with appellant, there were times when he left work for more than thirty minutes and did not clock out although knowing that it was a company policy to do so. He mentioned that other employees, whether at lunch time or otherwise, would leave work without clocking out.

John Bodden, another former employee of appellant who was terminated for violating the attendance policy, testified that he was aware of the policy that employees had to clock out when they left the premises. He had read the policy in the employee handbook and had been instructed of the policy by a couple of supervisors. However, Bodden stated that he leftwork every day for more than thirty minutes without clocking out and that to his knowledge his pay was never reduced.

On this evidence, the Board of Review determined that Roach's actions did not constitute misconduct. In particular, the Board found:

[T]he testimony of the employer's representative indicates that the claimant had often left without clocking out and that the employer had tacitly accepted the claimant's action. Given the employer's failure to strictly enforce the policy on prior occasions, the Board finds that the claimant was not given reasonable notice that his actions would be considered unacceptable, nor was he given a reasonable opportunity to conform his behavior to that expected by the employer. Had the employer established, through evidence or first-hand testimony, that it had notified its employees that it would no longer show leniency in enforcing the policy, then perhaps the claimant' s actions would constitute misconduct. However, as that fact has not been established, the Board is unable to find, based on the evidence before it that the claimant acted with the intent necessary for a finding of misconduct.

On appeal, the findings of the Board of Review are conclusive if they are supported by substantial evidence. Rucker v. Price, 52 Ark. App. 126, 915 S.W.2d 315 (1996). Substantial evidence is such relevant evidence that a reasonable mind might accept as adequate to support a conclusion. Perdrix-Wang v. Director, Employment Sec. Dep't , 42 Ark. App. 218, 856 S.W.2d 636 (1993). We review the evidence and all reasonable inferences deducible therefrom in the light most favorable to the Board's findings. Hiner v. Director, Ark. Empl. Sec. Dep't, 61 Ark. App. 139, 965 S.W.2d 785 (1998). Even when there is evidence upon which the Board of Review might have reached a different decision, the scope of our review is limited to a determination of whether the Board reasonably could have reached the decision it did based upon the evidence before it. Id. To establish an absence of substantial evidence to support the decision, the appellant must demonstrate thatthe proof before the administrative tribunal was so nearly undisputed that fair-minded persons could not reach its conclusion. Singleton v. Smith, 289 Ark. 577, 715 S.W.2d 437 (1986).

Arkansas Code Annotated section 11-10-514(a)(1) (Repl. 2002) provides, in relevant part, that an individual will be disqualified for benefits if that individual is discharged from work for misconduct in connection with that work. For the purposes of unemployment compensation, misconduct is defined as (1) disregard of the employer's interest; (2) violation of the employer's rules; (3) disregard of the standards of behavior that the employer has the right to expect; and (4) disregard of the employee's duties and obligations to the employer. Rucker v. Price, supra. There is an element of intent associated with a determination of misconduct. Fulgham v. Director, Employment Sec. Dep't, 52 Ark. App. 197, 918 S.W.2d 186 (1996). Therefore, for an individual's actions to constitute misconduct, sufficient to disqualify him or her from benefits, the actions must be deliberate violations of the employer's rules or acts of wanton or willful disregard of the standard of behavior that the employer has a right to expect of its employees. Kimble v. Director, Ark. Empl. Sec. Dep't, 60 Ark. App. 36, 959 S.W.2d 66 (1997).

In the instant case, Roach was terminated because on October 26, 2001, he left the appellant's premises without clocking out or back in. The testimony established (1) that appellant had a company policy that employees were to clock out when they left the work premises; (2) that Roach was aware of this policy; and (3) that Roach knowingly left work on October 26, 2001, without following the policy. However, the record also establishes thatappellant was aware that, on prior occasions, Roach had left work without clocking out, but did not take any disciplinary action against him. There was testimony by two former employees that appellant's employees often left the work premises without clocking out and without any resulting consequences. Even appellant's plant manager acknowledged that no one else but Roach had been terminated for violating this policy.

What may justify termination and what may warrant disqualification from unemployment benefits are separate inquires. Under these circumstances, appellant may have been justified in terminating Roach's employment, but it hardly seems just to find that Roach's actions amounted to misconduct so as to deny him unemployment benefits for violating a policy that, up until that point, appellant had not routinely enforced. Moreover, even though Roach left work without clocking out, he was given permission to leave, and he informed his supervisor of what time he left and returned.

We hold that the Board's decision to award benefits was supported by substantial evidence.

Affirmed.

Stroud, C.J., and Hart, J., agree.