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Gary & Leo's Fresh Foods, Inc v. State of Montana

October 9, 2012

GARY & LEO'S FRESH FOODS, INC., PETITIONER AND APPELLEE,
v.
STATE OF MONTANA, DEPARTMENT OF LABOR AND INDUSTRY, RESPONDENT AND APPELLANT.



APPEAL FROM: District Court of the First Judicial District, In and For the County of Lewis and Clark, Cause No. CDV 2011-701 Honorable Kathy Seeley, Presiding Judge

The opinion of the court was delivered by: Jim Rice

Submitted on Briefs: August 29, 2012

Decided: October 9, 2012

Filed:

Clerk

Justice Jim Rice delivered the Opinion of the Court.

¶1 The Montana Department of Labor & Industry (the Department) appeals from the First Judicial District Court's order reversing the Board of Labor Appeals' (the Board) award of unemployment benefits to Kaylee Reed (Reed). We affirm the District Court and address the issues:

¶2 1. Did the Department properly preserve its evidentiary arguments for appeal?

¶3 2. Did the District Court err by concluding that Reed's conduct constituted misconduct under the "carelessness standard" of Admin. R. M. 24.11.460(1)(d)?

FACTUAL AND PROCEDURAL BACKGROUND

¶4 Reed worked as a deli clerk for Gary & Leo's Fresh Food, Inc. (Gary & Leo's), a Havre grocery store, from February 22, 2009, until October 16, 2010. Reed's job consisted of filling shoppers' orders for deli items, such as sliced meats, salads, sandwiches, fried food, and coffee. Gary & Leo's terminated Reed's employment on October 16, 2010, after receiving complaints from shoppers regarding poor service and use of inappropriate language by Reed.

¶5 Reed applied for unemployment insurance benefits. The Department initially determined that Reed was eligible for benefits, but after Gary & Leo's requested a redetermination, it concluded that Reed was not qualified for benefits because she had been discharged for misconduct. Reed appealed and a hearing was conducted by a hearing officer on April 14, 2011.

¶6 At the hearing, Gary & Leo's manager Tracy Job testified that he had been prompted to fire Reed because of multiple customer complaints, a number of which were memorialized in her personnel file as reports. The first report was dated March 14, 2009, and was signed by a customer who said that Reed acted rudely toward her. The second and third reports, dated March 14, 2010, and May 1, 2010, documented similar complaints from other customers. The fourth report, dated October 12, 2010, documented a "very upset" customer who complained after Reed "was swearing and saying she didn't know how to make a meat and cheese tray." The fifth report, also dated October 12, 2010, documented a customer complaint that Reed was "extremely rude" and "obviously didn't want to help her in any way." Reed said that she had no objection to these reports, and the hearing officer admitted them into evidence.*fn1 Reed testified and denied the allegations contained in the reports. While Reed admitted to using profane language at work, she testified that she did so out of earshot of customers.

ΒΆ7 The hearing officer found that five customer complaints regarding Reed's service had been made in her year-and-a-half employment with Gary & Leo's. However, the hearing officer concluded that Reed had not intentionally acted rudely toward customers. Citing Admin. R. M. 24.11.460(1)(a)--(b), the hearing officer noted that misconduct was defined as the "deliberate disregard of the employer's rights and interests or the deliberate disregard of employee standards of behavior the employer had the right to expect." While Reed had been issued written warnings regarding ...


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