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State ex rel. Department of Workforce Services v. Kinneman

Supreme Court of Wyoming

August 10, 2016

STATE OF WYOMING, ex rel., DEPARTMENT OF WORKFORCE SERVICES, UNEMPLOYMENT INSURANCE COMMISSION, Appellant (Respondent),
v.
SUSAN M. KINNEMAN, Appellee (Petitioner).

         Appeal from the District Court of Fremont County The Honorable Marvin L. Tyler, Judge

          Representing Appellant/Respondent Peter K. Michael, Wyoming Attorney General; John D. Rossetti, Deputy Attorney General; Michael J. Finn, Senior Assistant Attorney General; Charlotte M. Powers, Assistant Attorney General.

          Representing Appellee/Petitioner Cynthia Van Vleet, Wind River Law Center, P.C., Riverton, Wyoming.

          Before BURKE, C.J., and HILL, DAVIS, FOX, and KAUTZ, JJ.

          KAUTZ, Justice.

         [¶1] After she was discharged from her position as high school principal of the St. Stephens Indian School near Riverton, Wyoming, Appellee/Petitioner Susan M. Kinneman applied for unemployment insurance benefits. Appellant/Respondent State of Wyoming ex rel. Department of Workforce Services, Unemployment Insurance Commission (the Commission) denied her request because it determined she had been fired for misconduct connected with her work. Ms. Kinneman filed a petition for judicial review, and the district court reversed, concluding the Commission's decision was not supported by substantial evidence. The Commission challenges the district court's decision on appeal.

         [¶2] We affirm.

         ISSUE

         [¶3] The Commission presents the following appellate issue:

An individual terminated for misconduct connected with her work cannot receive unemployment insurance benefits. The Unemployment Insurance Commission denied Susan Kinneman's claim for benefits because she was discharged for misconduct committed when she failed to promptly initiate a formal assessment of a student despite her recognized duty to assess the student. Did the District Court err in reversing the Commission's decision as not supported by substantial evidence?

Although she phrases it somewhat differently, Ms. Kinneman presents essentially the same issue on appeal.

         FACTS

         [¶4] The St. Stephens Indian School (hereinafter referred to as "the school") hired Ms. Kinneman in 2012 to serve as the dean of students. In early 2013, she was promoted to high school principal and continued in that position until September 2014. Elma Brown became the superintendent of the school in July 2014.

         [¶5] Classes began on August 18, 2014, and shortly thereafter, on August 26, 2014, Ms. Brown placed Ms. Kinneman on an "action plan" to improve her performance, after learning that Ms. Kinneman was having problems with her secretary and had failed to inform Ms. Brown about a fight at school. The action plan focused on helping Ms. Kinneman improve her communication with students, staff, other stakeholders, and Ms. Brown. As part of the plan, Ms. Kinneman was required to inform Ms. Brown of any important matters regarding the school.

         [¶6] On August 28, 2014, the guidance counselor reported to Ms. Kinneman that a high school senior appeared to be overly tired. Although the counselor listed drugs or alcohol as two of the many reasons a student may be fatigued, she did not state that she believed the student was drunk. In fact, she specifically stated that she did not know the cause of the student's tiredness. Ms. Kinneman located the student in the hallway. After observing her, Ms. Kinneman concluded she looked tired, like she might be "under the influence possibly of cold medicine or that she might have been up late, " but Ms. Kinneman did not believe the girl was drunk.

         [¶7] Nevertheless, because of the guidance counselor's report, Ms. Kinneman knew that she needed to have the student assessed. She asked her secretary to contact the school nurse to perform a "quiet assessment" because she did not want to embarrass the student. The secretary stated that the nurse was not available. Although Ms. Kinneman knew there were other staff members in the district who could perform an assessment, she decided to contact Ms. Brown to determine the "next step." Ms. Kinneman directed her secretary to call the superintendent, but Ms. Brown was not available.

         [¶8] At that point, Ms. Kinneman said she was not going to assess the student at that time and was leaving the school for a while. There is considerable dispute in the record as to whether Ms. Kinneman left campus or visited another building on campus. There is also a discrepancy about the length of time she was gone from the high school. Ms. Kinneman stated that she was gone only fifteen minutes and others stated that she was gone approximately forty-five minutes. In any event, by the time Ms. Kinneman returned to the high school, her secretary had contacted Ms. Brown and informed her there was a potentially drunk student at the high school. Ms. Brown arrived at the school shortly thereafter.

         [¶9] Ms. Brown pulled the student out of class, took her to the elementary school nurse's office and performed an assessment, which did not indicate the student was intoxicated. The school resource officer performed two breathalyzer tests to detect the presence of alcohol, which were also negative. Shortly thereafter, Ms. Brown launched an investigation into Ms. Kinneman's handling of the situation. A few days later, on September 2, 2014, Ms. Brown gave Ms. Kinneman a letter of termination, which stated that she had committed "gross negligence" by not promptly assessing a student who was potentially intoxicated and allowing the student to remain in class while Ms. Kinneman left the building.

         [¶10] Ms. Kinneman applied for unemployment insurance benefits. A deputy for the Unemployment Insurance Division denied her claim after determining she was discharged for misconduct connected with her work. She appealed, and a hearing officer for the Wyoming Department of Workforce Services Appeals Division held a contested case hearing. The hearing officer ruled that Ms. Kinneman was discharged from her employment, but not for misconduct connected with her work. The school appealed to the Commission, which reviewed the hearing transcript but did not take any new evidence.[1] The Commission concluded that Ms. Kinneman was not entitled to benefits because she had been "discharged for an instance of negligence of such a degree to constitute misconduct." Ms. Kinneman filed a petition for judicial review, and the district court reversed, concluding that the Commission's decision was not supported by substantial evidence. The Commission appealed to this Court.

         STANDARD OF REVIEW

         [¶11] In unemployment insurance cases, we review the decision of the Commission; the decisions of the deputy, the hearing officer and the district court are not relevant to our analysis. Koch v. Dep't of Employment, Unemployment Ins. Comm'n, 2013 WY 12, ¶ 15, 294 P.3d 888, 892 (Wyo. 2013). Given the Commission is an administrative agency, our review is governed by Wyo. Stat. Ann. § 16-3-114(c) (LexisNexis 2015):

(c) To the extent necessary to make a decision and when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action. In making the following determinations, the court shall review the whole record or those parts of it cited by a party and due account shall be taken of the rule of prejudicial error. The reviewing court shall:
(i) Compel agency action unlawfully withheld or unreasonably delayed; and
(ii) Hold unlawful and set aside agency action, findings and ...

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