Wright v. Sw. Airlines Co.

1

315 Neb. 911

Kathryn Wright, appellant, v. Southwest Airlines Co. and Nebraska Department of Labor, appellees.

No. S-23-376

Supreme Court of Nebraska

February 9, 2024

1. Employment Security: Judgments: Appeal and Error. In an appeal from the appeal tribunal to the district court regarding unemployment benefits, the district court conducts the review de novo on the record, but on review by the Nebraska Court of Appeals or the Nebraska Supreme Court, the judgment of the district court may be reversed, vacated, or modified for errors appearing on the record.

2. Judgments: Appeal and Error. When reviewing a judgment for errors appearing on the record, the inquiry is whether the decision conforms to law, is supported by competent evidence, and is neither arbitrary, capricious, nor unreasonable.

3. Employment Security: Appeal and Error. The question of whether an employee was "discharged for misconduct connected with his or her work" under Neb Rev. Stat. § 48-628.10 (Reissue 2021) is a mixed question of law and fact.

4._____:____ . In analyzing whether an employee was discharged for misconduct connected with his or her work under Neb. Rev Stat. § 48-628.10 (Reissue 2021), the historical facts and circumstances surrounding the discharge are questions of fact, but the ultimate question of whether, given those facts and circumstances, the employee's misconduct is connected with work presents a question of law.

5. Judgments: Appeal and Error. An appellate court, in reviewing a district court judgment for errors appearing on the record, will not substitute its factual findings for those of the district court where competent evidence supports those findings.

6. ____: ____. Whether a decision conforms to law is by definition a question of law, in connection with which an appellate court reaches a conclusion independent of that reached by the lower court.

7. Employment Security: Words and Phrases. "Misconduct," for purposes of Neb. Rev. Stat. § 48-628.10 (Reissue 2021), includes behavior which evidences (1) wanton and willful disregard of the employer's interests, (2) deliberate violation of rules, (3) disregard of standards of behavior which the employer can rightfully expect from the employee, or (4) negligence which manifests culpability, wrongful intent, evil design, or intentional and substantial disregard of the employer's interests or of the employee's duties and obligations.

8. Employment Security. Misconduct connected with work is a breach of a duty owed to the employer, not to society in general.

Appeal from the District Court for Douglas County: Peter C Bataillon, Judge.

Jon Rehm, of Rehm, Moore &Rehm, P.C., L.L.O., for appellant.

Gerald W. Pankonin, Katie S. Thurber, and Joel F. Green, of Nebraska Department of Labor, for appellee Nebraska Department of Labor.

Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, Papik, and Freudenberg, JJ.

Papik J.

Southwest Airlines Co. (Southwest) terminated Kathryn Wright's employment as a customer service agent after it concluded that, in her volunteer role on a workplace social committee, she failed to keep adequate records of expenditures and spent committee funds for personal purposes. Wright's subsequent application for unemployment insurance benefits was initially granted by a Nebraska Department of Labor (DOL) adjudicator, but that decision was overturned by the DOL appeal tribunal. The district court affirmed, finding that Wright was disqualified from receiving unemployment benefits for the week of the discharge and the 14 weeks thereafter because she was terminated "for misconduct connected with . . . her work" under Neb. Rev. Stat. § 48-628.10 (Reissue 2021). Wright appeals that decision. Because she does not identify any errors appearing on the record, we affirm.

BACKGROUND

DOL Adjudicator Finds Wright Qualified for Unemployment Benefits.

Wright was employed as a customer service agent for Southwest. She was discharged from her employment following an internal disciplinary hearing. Wright filed a claim for unemployment insurance benefits. A DOL adjudicator conducted an investigation and issued a determination that Wright qualified for those benefits.

DOL Appeal Tribunal Finds Wright Disqualified for Benefits.

Southwest filed an administrative appeal of the adjudicator's decision with the appeal tribunal. The matter was heard before an administrative law judge.

According to testimony at the hearing, Wright was employed as a customer service agent for Southwest at its station in Omaha Nebraska. Her job duties included working at the ticket counter, the gate, and the baggage service office. Wright testified that on a number of occasions, she was nominated by a coworker for an award in recognition of her exemplary job performance. However, Wright was discharged from her employment following an internal hearing related to her volunteer activities on Southwest's "Culture Committee."

The appeal tribunal heard testimony that the Culture Committee was established to increase employee morale and retention at Southwest. Southwest flew Omaha employees who joined the Culture Committee to the company's headquarters and trained them to promote the company's culture; Southwest paid employees for the time they spent in this training. Members of the Culture Committee, overseen by Southwest's station manager, planned activities for employees at their respective workplaces, such as holiday parties. Occasionally, Culture Committee members did tasks for the committee on their personal time, for which they were not paid by Southwest.

There was testimony before the appeal tribunal that Culture Committee activities were funded in part by contributions from Southwest headquarters and in part from contributions from local Southwest employees. For special events, Southwest would give the Culture Committee a certain amount of funds to use per employee. Southwest also supported the Culture Committee's efforts to fundraise from employees by allowing the Culture Committee to keep proceeds from breakroom vending machines stocked by the Culture Committee.

According to the testimony at the hearing, when Wright joined the Culture Committee, she was authorized to use the bank card for a Culture Committee account. The bank card bore the names of both Wright's supervisor and "Culture Committee." The account for the bank card was funded by the voluntary contributions of local employees. Wright's station manager testified that employee contributions to the Culture Committee were meant for "culture within the station and nothing else."

The station manager testified that in December 2021, he communicated to the Culture Committee members, including Wright, that "[t]his is money for the station" and explained the expectations for handling committee funds. He told them that they were required to keep a ledger, or "detailed documentation," of all purchases and to "keep receipts." The station manager recalled that he was "very frank with [Wright] and the rest of the people in the room, that, hey, we're not going to put ourselves in a situation where there is a question on how money was spent, or where money was spent, and what it was spent on."

The appeal tribunal heard the station manager's testimony that Wright made purchases with the Culture Committee bank card, but she did not keep a ledger of expenses as he had instructed her. The station manager also testified that when receipts were itemized at the end of February 2022, it came to his attention that Wright had not submitted receipts for some of her purchases. The station manager approached Wright and told her that receipts were missing. Wright initially stated that she would produce the missing receipts.

The station manager testified that at a Culture Committee meeting a couple of weeks later, there was again discussion about the importance of providing receipts for all purchases; Wright, the station manager, and other committee members were present. At that meeting, Wright confirmed she would provide the missing receipts.

There was testimony that when Wright still did not submit the receipts, the station manager followed up with an email to Wright, giving her a deadline. Wright turned in some of the missing receipts, but not all of them, and she asked for an extension of the deadline due to a family emergency. The station manager sent another email extending the deadline, but Wright did not meet the extended deadline.

At that point, the station manager testified, he issued a notice of hearing to address the missing receipts and misuse of company funds. The station manager recalled that at the internal hearing, Wright admitted to using the Culture Committee card to renew her personal Sam's Club membership, which was required to shop at the store. He also recalled that Wright admitted to using the Culture Committee card to purchase groceries for her personal use. At the internal hearing, Wright turned in receipts for those expenditures and offered reimbursement. According to the station manager, "we were not aware of the misappropriation of funds until the [internal] hearing occurred, because there [were] approximately . . . 10 receipts that we did not have for us to validate the purchases that were made from the account."

Of the receipts that Wright turned in, one confirmed that Wright had used the committee's bank card to renew her personal membership to Sam's Club for $35 in January 2022. Testimony before the appeal tribunal established that Wright did this without asking for permission and did not ask Southwest to pay for a membership. The station manager testified that, given the purposes for the funds in the Culture Committee account, Wright was not "allowed" to use those funds to renew her...