HECTOR ORTIZ v. BOARD OF REVIEW DEPARTMENT OF LABOR ALUMINUM SHAPES (2013)

Hector Ortiz appeals from the final decision of the Board of Review, which deemed him ineligible for unemployment benefits based upon the administrative finding that he was terminated from his job for severe misconduct.  N.J.S.A. 43:21–5(b).  We reverse and remand for the Board to consider whether the grounds for Ortiz's termination constitute severe misconduct under Silver v. Board of Review, 430 N.J.Super.   44 (App.Div.2013).

We discern the following facts from the record.   Ortiz worked at Aluminum Shapes, L.L.C., as a mechanic's assistant from February 26, 1997 until September 17, 2010.   The employer's attendance policy limited absenteeism and required all employees to call before the beginning of their shift if they were going to be absent from work.   Using a point system to evaluate attendance, the employer terminated employees when they reached twenty-four points.

The employer had previously terminated Ortiz on April 16, 2010, for nine days of absence and failure to call the employer before taking the days off, which totaled twenty-seven points.   After Ortiz reported that he was absent due to a family emergency, the employer reinstated him on April 19, 2010, and removed the twenty-seven points accumulated for the April absence from his record.   He was left with his previously accumulated twenty points.   The employer's records showed that Ortiz had never called out before any of these previous absences.

On September 9, 2010, a scheduled work day, Ortiz went to Connecticut to help his sister because she had broken her hand in an accident.   He did not call his employer before leaving, and was absent from work for two days.   Because he had again exceeded the attendance point maximum, the employer fired Ortiz on September 17, 2010.

Ortiz filed a claim for unemployment benefits on October 3, 2010.   The Deputy Director (Deputy) of the Division of Unemployment and Disability Insurance ruled that Ortiz was disqualified for benefits because he was discharged for severe misconduct connected with work.

Ortiz filed an appeal of the Deputy's determination.   The Appeals Tribunal held a telephone hearing on June 15, 2011, and affirmed the Deputy's decision in a written opinion on June 28, 2011.   In upholding the Deputy's determination, the Tribunal stated:

The claimant's action in failing to contact the employer and report his absences, which was the cause of the discharge, was a disregard of the standards of behavior which the employer has a right to expect of his employees and constitutes misconduct connected with the work.   Therefore, the claimant is disqualified for benefits under N.J.S.A. 43:21–5(b), as of 09/12/10, as he was discharged for severe misconduct connected with the work.

The Board of Review affirmed the Appeals Tribunal's decision on January 26, 2012.   This appeal followed.

In reviewing this final agency decision, we give substantial deference to the Board of Review.   Our main focus is whether the Board's determination was arbitrary, unreasonable or capricious, or unsupported by the record.  Bailey v. Bd. of Review, 339 N.J.Super. 29, 33 (App.Div.2001).   The deference to an agency's findings of fact “is premised on our confidence that there has been a careful consideration of the facts in issue and appropriate findings addressing the critical issues in dispute.”  Ibid. However, the Court may reject the Board's conclusions where they reflect a misapplication of unemployment statutes and regulations.  Silver, supra, 430 N.J.Super. at 58.

Until 2010, N.J.S.A. 43:21–5(b) identified two types of misconduct that prevented full receipt of benefits.  “Gross misconduct” is “an act punishable as a crime” and results in a complete disqualification for benefits.  Ibid. “Misconduct” is found where an employee's act is “improper, intentional, connected with one's work, malicious, and within the individual's control, and is either a deliberate violation of the employer's rules or a disregard of standards of behavior which the employer has the right to expect of an employee.”  N.J.A.C. 12:17–10.2(a).   It results in an eight-week disqualification from unemployment benefits.  N.J.S.A. 43:21–5(b).

We described this “two-prong standard” for misconduct as follows:  “First, the conduct must be improper, intentional, connected with the work, malicious, and within the employee's control.   Second, the conduct must also be either a deliberate violation of the employer's rules or a disregard of the standards of behavior which the employer has the right to expect.”  Silver, supra, 430 N.J.Super. at 53.   Misconduct must also be “more than simply inadequate job performance that provides good cause for discharge.”  Parks v. Bd. of Review, 405 N.J.Super. 252, 254 (App.Div.2009).

In 2010, an intermediate type of misconduct, severe misconduct, was added to N.J.S.A. 43:21–5(b).  L. 2010, c. 37, § 2, eff.   July 1, 2010.   An employee who has been discharged for severe misconduct is disqualified for unemployment benefits until reemployed for at least four weeks and has earned at least six times the employee's weekly unemployment benefit rate.  Ibid. The statute does not define severe misconduct, but does provide examples, such as “repeated violations of an employer's rule or policy,” “repeated lateness or absences after a written warning by an employer,” and “abuse of leave.”  Ibid.

However, the threshold of culpability required for severe misconduct, which carries a more stringent disqualification from benefits, cannot be less than that for simple misconduct.  Silver, supra, 430 N.J.Super. at 55.   As we previously observed, the conduct given as examples under the severe misconduct statute required the same finding of intent, deliberateness, or malice as simple misconduct.  Id. at 55–56.

The Appeals Tribunal's decision, affirmed by the Board, failed to consider whether Ortiz's actions were intentional, deliberate or malicious, the first prong of the Silver standard.   We recognize that the Board made its determination prior to our decision in Silver, which clarified the standard of culpability for severe misconduct.   Accordingly, we remand this case to the Board to reconsider in light of the two-prong standard in Silver.

Reversed and remanded.   We do not retain jurisdiction.

PER CURIAM