                                  Illinois Official Reports

                                          Appellate Court



            Farris v. Department of Employment Security, 2014 IL App (4th) 130391




Appellate Court              DONALD FARRIS, Plaintiff-Appellee, v. THE DEPARTMENT OF
Caption                      EMPLOYMENT SECURITY, an Administrative Agency in the State
                             of Illinois; THE DIRECTOR OF EMPLOYMENT SECURITY; and
                             THE BOARD OF REVIEW, an Administrative Agency of the State of
                             Illinois, Defendants-Appellants, and STROUT CROSSING, LLC,
                             Defendant.


District & No.               Fourth District
                             Docket No. 4-13-0391


Filed                        March 11, 2014


Held                         The appellate court had jurisdiction to consider the Department of
(Note: This syllabus         Employment Security’s appeal from the trial court’s reversal of the
constitutes no part of the   Board of Review’s decision that plaintiff was not entitled to
opinion of the court but     unemployment benefits because he was discharged for employment-
has been prepared by the     related misconduct based on his violation of a biosecurity policy at the
Reporter of Decisions        pig-breeding facility where he worked, even though plaintiff’s
for the convenience of       employer did not participate in the trial court proceedings, since the
the reader.)                 Department is responsible for defending the Board’s decisions and
                             protecting against erroneous payouts from the unemployment fund,
                             and in plaintiff’s case, the fact that plaintiff’s employer was not
                             harmed by plaintiff’s violation of the biosecurity policy was due to the
                             fortuitous intervention of a supervisor who refused to allow plaintiff to
                             return to a “clean” area of the facility with contaminated clothing and
                             did not prevent the violation from being deemed misconduct under
                             section 602(A) of the Unemployment Insurance Act.


Decision Under               Appeal from the Circuit Court of Greene County, No. 11-MR-40; the
Review                       Hon. James W. Day, Judge, presiding.
     Judgment                 Circuit court reversed; Board confirmed.


     Counsel on               Lisa Madigan, Attorney General, of Chicago (Michael A. Scodro,
     Appeal                   Solicitor General, and John P. Schmidt, Assistant Attorney General, of
                              counsel), for appellants.

                              Richard N. Gillingham, of Carrollton, for appellee.




     Panel                    JUSTICE STEIGMANN delivered the judgment of the court, with
                              opinion.
                              Justices Knecht and Turner concurred in the judgment and opinion.




                                               OPINION

¶1         In January 2011, plaintiff, Donald Farris, was fired from his employment at a pig-breeding
       facility owned by Strout Crossing, LLC (Strout), and operated by Pike Pig Systems, Inc.
       (Pike), for violating a biosecurity policy designed to avoid bacterial contaminants from
       entering the breeding facility and infecting the pigs. Plaintiff applied to the Department of
       Employment Security (Department) for unemployment benefits. Strout objected on the ground
       that plaintiff was discharged due to employment-related misconduct, rendering him ineligible
       for unemployment benefits under section 602(A) of the Unemployment Insurance Act (820
       ILCS 405/602(A) (West 2012)). A claims adjudicator agreed with Strout. Plaintiff appealed
       the claims adjudicator’s decision to a Department referee who, following a hearing,
       determined that plaintiff was eligible for unemployment benefits because his actions did not
       constitute misconduct within the meaning of section 602(A) of the Act. Strout appealed the
       referee’s decision to the Board of Review (Board), which reversed the referee’s decision and
       found plaintiff ineligible for unemployment benefits. Plaintiff then filed a complaint for
       administrative review in the circuit court, arguing that he was not guilty of employment-related
       misconduct because his violation of the biosecurity policy did not result in harm to Strout. The
       circuit court agreed and reversed the Board’s decision.
¶2         The Department, its Director, and the Board appeal from the circuit court’s decision,
       arguing that plaintiff’s actions constituted misconduct within the meaning of section 602(A) of
       the Act, even though those actions did not result in actual harm. We agree and reverse.

¶3                                       I. BACKGROUND
¶4         The following facts were gleaned from the record of administrative proceedings before the
       Department’s local-office claims adjudicator, the Department referee, and the Board, as well
       as the circuit court record. From December 2005 until January 2011, plaintiff worked as a



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       farmhand in the breeding barn of Strout’s pork production facility. After his discharge in
       January 2011, plaintiff applied to the Department for unemployment benefits.

¶5                             A. Proceedings Before the Claims Adjudicator
¶6         Strout filed an objection to plaintiff’s claim with the claims adjudicator of the
       Department’s local office on the ground that plaintiff was ineligible for unemployment
       benefits under section 602(A) of the Act because he was discharged due to
       employment-related misconduct.
¶7         Strout submitted a written statement of its biosecurity procedures, as contained in the
       employee handbook, to the claims adjudicator. The handbook described biosecurity as “of the
       upmost [sic] importance” to the company. The biosecurity policy designated the area of the
       farm facility where the pigs were located as the “clean” area, and the other parts of the facility
       as the “dirty” area. When employees who worked in the clean area arrived at work, they were
       required to remove their clothing in the dirty area, take a shower, walk through the shower area
       into the clean area, and put on clean clothes supplied by the farm. When leaving the clean area,
       workers were required to remove their farm clothes, leave them behind in the clean area and
       “shower through” to the dirty area, where they could put on their own clothes and leave at the
       end of their shifts. According to the employee handbook, these showering procedures were
       “the core of the personal biosecurity program” and necessary to prevent the spread of diseases,
       which can be easily carried on shoes, clothing, fingernails, hair, and jewelry.
¶8         According to Strout’s written statement regarding the circumstances of plaintiff’s
       termination on January 15, 2011, plaintiff’s supervisor, David Bishop of Pike, received a
       phone call from a Pike supervisor asserting that he could not locate plaintiff and suggesting
       that he might be sleeping in a bathroom in the dirty area of the facility. Bishop went to the farm
       facility and heard what he perceived to be snoring coming from a bathroom in the dirty area.
       Bishop knocked several times, and eventually heard a voice from inside say, “I’m taking a
       crap.” The toilet then flushed and plaintiff exited the bathroom while still wearing his farm
       clothes, which had been soiled with pig manure from activity inside the clean area. Bishop then
       fired plaintiff for violating the farm’s biosecurity procedures.
¶9         In a misconduct questionnaire submitted to the claims adjudicator, plaintiff claimed that he
       did not know about the biosecurity procedures that he violated. He further claimed that he
       would have showered before returning to the clean area, but Bishop fired him before he had a
       chance to do so.
¶ 10       The claims adjudicator determined that plaintiff was ineligible for unemployment benefits
       under section 602(A) of the Act because he was discharged for misconduct connected with his
       job. The claims adjudicator reasoned that plaintiff violated one of Strout’s known and
       reasonable company rules.

¶ 11                                B. Proceedings Before the Referee
¶ 12       Plaintiff appealed the claims adjudicator’s decision to a Department referee. In March
       2011, the referee held a hearing over the telephone, in which plaintiff and Bishop participated
       remotely via conference call. Bishop testified that plaintiff had been trained in the biosecurity
       procedures, which were written in an employee handbook. The handbook stated that a gross or
       intentional violation of the biosecurity procedures was grounds for immediate termination.


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¶ 13       According to Bishop, plaintiff was scheduled to work from 6 a.m. to 2:30 p.m. on January
       15, 2011. Before Bishop arrived at the farm facility that morning, he received a phone call from
       a supervisor who told him that he could not find plaintiff. After his arrival at approximately
       7:40 a.m., Bishop heard noise coming from a bathroom. That bathroom was in the dirty area of
       the farm, and it was often used by employees who did not work in the clean area. The clean
       area contained two bathrooms. After Bishop knocked on the bathroom door, plaintiff
       eventually emerged dressed in farm clothing containing pig-manure stains. Plaintiff told
       Bishop that he had to use the bathroom. When Bishop asked plaintiff if he knew about the
       biosecurity procedures, plaintiff said “yes” but stated that other people needed to be fired for
       biosecurity violations as well. Bishop instructed plaintiff to remove his farm clothing and leave
       it behind. Bishop testified that plaintiff’s violation of the biosecurity procedures did not cause
       any harm because Bishop discovered plaintiff before he could reenter the clean area. Bishop
       asserted that had plaintiff reentered the clean area, such an event could have cost the company
       over $40,000 in extra pig vaccines.
¶ 14       Plaintiff testified that he used the bathroom in the dirty area because one of the bathrooms
       in the clean area was occupied and the other one was unsanitary. Plaintiff admitted that he wore
       his farm clothes into the dirty area and that Bishop told him he was being discharged for
       violating biosecurity procedures. Plaintiff asserted that he had never received any warnings
       regarding the biosecurity procedures, nor did he remember signing a paper containing those
       procedures when he began his employment.
¶ 15       During the hearing, Bishop asked plaintiff how he intended to get the soiled farm clothes
       he was wearing–which were supposed to always remain in the clean area–back into the clean
       area where the washing machines were located. Plaintiff replied that he could have taken the
       soiled clothes off, had another employee come from the clean area to retrieve them, and then
       shower through to the clean area. Plaintiff seemed to assert that no biosecurity breach would
       occur as long as the soiled clothes did not touch the ground. Bishop then asked plaintiff
       whether the employee who came to retrieve the soiled clothes would have been guilty of a
       biosecurity breach, to which plaintiff replied, “No, no, because people bring in their lunch
       boxes every day past that and set them on the inside [of the clean area], that’s a breach of
       biosecurity, every day, everybody who does that. So it wouldn’t make no difference if I did
       that because anybody brings their lunch in is doing that.”
¶ 16       Several days after the hearing, the referee issued a decision in which he concluded, as
       follows:
                “Here, [plaintiff] normally had used the outside restrooms after being inside the barrier
                and without showering first to do so. He received no warnings for doing so. He
                received no clear direction regarding the bio-hazard policy as it related to showering
                other than he knew he was to shower upon coming to work. On these facts the
                employer condoned [plaintiff’s] behavior regarding the bio-hazard policy.
                    *** Even had the employer not condoned [plaintiff’s] behavior, his absence of a
                clear understanding of what the employer expected in regard to the bio-hazard policy
                rendered his behavior on January 15, 2011, to be if anything [an] inadvertent and
                negligent violation of the bio-hazard procedure rather than deliberate and willful. There
                was no misconduct within the meaning of [s]ection 602A of the [Act].”
       The referee set aside the claim adjudicator’s determination and found plaintiff eligible for
       unemployment benefits.


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¶ 17                                     C. The Board’s Decision
¶ 18       Strout appealed the referee’s decision to the Board. In May 2011, after reviewing the
       record of the hearing before the referee, the Board released a decision stating it found
       plaintiff’s claim that he had never been informed of the biosecurity procedures incredible. The
       Board concluded that plaintiff was not entitled to unemployment benefits because his actions
       were “deliberate and willful,” rising to an “intentional violation of the employer’s rules,” and
       constituting misconduct within the meaning of section 602(A) of the Act.

¶ 19                     D. The Circuit Court’s Decision on Administrative Review
¶ 20       Later in May 2011, in an apparent attempt to initiate administrative review of the Board’s
       decision, plaintiff filed with the circuit court copies of the referee’s decision, the Board’s
       decision, and an application to sue in forma pauperis. The court, noting in a docket entry that
       “[t]his type of proceeding is far too complicated for [plaintiff] to try to do *** on his own,”
       appointed an attorney to represent plaintiff pro bono. Through his attorney, plaintiff filed a
       formal complaint for administrative review, naming the Department, its Director, the Board,
       and Strout as defendants. The Attorney General entered its appearance on behalf of the
       Department, its Director, and the Board. Strout did not enter an appearance or otherwise
       participate at the circuit court level.
¶ 21       In a brief to the circuit court, plaintiff admitted that he violated the biosecurity procedures
       by leaving the clean area and going into the dirty area without removing his farm clothes or
       showering. Plaintiff further asserted that because he was stopped before reentering the clean
       area, he was not guilty of employment-related misconduct, since Strout suffered no harm from
       his violation of the biosecurity procedures. In a response brief, the Attorney General argued
       that plaintiff’s rule violation constituted misconduct within the meaning of section 602(A) of
       the Act because it posed a risk of substantial harm to Strout.
¶ 22       After considering the administrative record and the parties’ briefs, the circuit court
       reversed the Board’s decision on the grounds that Strout had not suffered harm from plaintiff’s
       violation of the biosecurity procedures. The court stated, “There being no finding of harm by
       the [B]oard and no harm alleged (in fact denied) by the employer then, as they say in
       basketball–no harm, no foul. The decision of the Board of Review is reversed.”
¶ 23       This appeal followed.

¶ 24                                          II. ANALYSIS
¶ 25       On appeal, the Department, its Director, and the Board argue that plaintiff’s actions
       constituted misconduct within the meaning of section 602(A) of the Act, even though those
       actions did not result in actual harm.

¶ 26                                          A. Jurisdiction
¶ 27       We first address plaintiff’s contention that we lack jurisdiction over this appeal. Plaintiff
       argues that when the adverse party (the employer) fails to participate at the circuit court level,
       an agency which did participate at that level (the Board, the Department, or the Director) lacks
       standing to appeal from the circuit court’s reversal of the agency’s decision. Plaintiff asserts
       that the Board lacks standing because its role is merely that of an impartial tribunal for claims
       between an employee and the employer, and the Department and its Director lack standing
       because they are merely trustees of the unemployment insurance fund.
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¶ 28        However, in Braun v. Retirement Board of the Firemen’s Annuity & Benefit Fund, 108 Ill.
       2d 119, 128, 483 N.E.2d 8, 12 (1985), the supreme court rejected the argument that the
       retirement board lacked standing to appeal the circuit court’s reversal of its own decision. The
       court explained that “[t]he retirement board has extensive managerial responsibilities,
       however, and it is more than a tribunal.” Id. Pursuant to Braun, we conclude that the state
       parties have standing to appeal the circuit court’s adverse decision.
¶ 29        As the guardians of the unemployment insurance fund, the Department and its Director
       have a duty to protect the fund from diminution in the form of disbursements to ineligible
       claimants. Private employers cannot be relied upon to serve as the fund’s sole defense against
       unqualified claims. As the facts of this case illustrate, a claimant seeking unemployment
       benefits can obtain administrative review in the circuit court at virtually no cost. Here, the
       circuit court (for whatever reason) even appointed counsel to represent plaintiff pro bono. The
       corporate employer, on the other hand, must retain private counsel if it wishes to participate at
       the circuit court level. See, e.g., Downtown Disposal Services, Inc. v. City of Chicago, 407 Ill.
       App. 3d 822, 832, 943 N.E.2d 185, 194 (2011) (“[C]orporations must appear in court through a
       licensed attorney, rather than a layperson.”). In the face of an erroneous claim by an ineligible
       claimant, the cost to an employer of paying out the claim will almost always be less than the
       cost of hiring legal counsel to defend against the claim at the circuit court level–much less the
       appellate court level.
¶ 30        Section 1100 of the Act provides as follows: “The Director shall be deemed to have been a
       party to any administrative proceeding before the Board of Review and shall be represented by
       the Attorney General in any judicial action involving any such decision.” (Emphasis added.)
       820 ILCS 405/1100 (West 2012). The Department and its Director administer the fund that
       plaintiff seeks to draw from. The legislature has entrusted the Department and its Director with
       the responsibility of administering the Act, as follows:
                “It shall be the duty of the Director to administer this Act. To effect such
                administration, there is created the Department of Employment Security, under the
                supervision and direction of a Director of Employment Security. The Department of
                Employment Security shall administer programs for unemployment compensation and
                a State employment service. The Director shall determine all questions of general
                policy, promulgate rules and regulations and be responsible for the administration of
                this Act.” 820 ILCS 405/1700 (West 2012).
¶ 31        The legislature has also entrusted the Department and its Director with protecting the fund
       and handling its assets in accordance with the Act. See 820 ILCS 405/2100(A) (West 2012). If
       “extensive managerial responsibilities” are ever sufficient to confer standing upon an
       administrative agency to prosecute an appeal, as the supreme court held in Braun (Braun, 108
       Ill. 2d at 128, 483 N.E.2d at 12), then that criterion surely applies in this case. Given the
       above-cited provisions of the Act, the practical need for an advocate to defend the decisions of
       the Board in the circuit court and guard against erroneous payouts from the unemployment
       fund, and the extensive managerial responsibilities of the Department and its Director, we
       conclude that the legislature intended to confer standing upon the Department, its Director, and
       the Board to prosecute appeals from adverse circuit court decisions. See Stone v. Department
       of Employment Security Board of Review, 151 Ill. 2d 257, 260, 602 N.E.2d 808, 809 (1992)
       (allowing the Board’s petition for leave to appeal from an adverse appellate court decision
       where the employer was not named as a party). Accordingly, we have jurisdiction over this
       appeal.

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¶ 32                        B. Plaintiff’s Claim for Unemployment Benefits
¶ 33       The Department, its Director, and the Board argue that the circuit court erred by
       determining that plaintiff’s actions did not constitute misconduct within the meaning of section
       602(A) of the Act because they did not result in harm to Strout. We agree.

¶ 34                                       1. Standard of Review
¶ 35       “On appeal from the circuit court, we review the findings of the Board, not the referee or
       circuit court.” Walls v. Department of Employment Security, 2013 IL App (5th) 130069, ¶ 14,
       993 N.E.2d 1129. Because the Board’s decision that plaintiff was not eligible for
       unemployment benefits due to his misconduct constitutes a mixed question of law and fact, we
       will reverse the Board’s decision only if it was clearly erroneous. AFM Messenger Service, Inc.
       v. Department of Employment Security, 198 Ill. 2d 380, 391, 763 N.E.2d 272, 279 (2001).
       Under this standard, we will reverse the Board’s decision only if, based on the entire record,
       we are left with the definite and firm conviction that a mistake has been committed. Id. at 395,
       763 N.E.2d at 282.

¶ 36                                     2. Section 602(A) of the Act
¶ 37        Section 602(A) of the Act provides that employees discharged for misconduct shall not be
       eligible to receive unemployment benefits. Alternative Staffing, Inc. v. Illinois Department of
       Employment Security, 2012 IL App (1st) 113332, ¶ 30, 983 N.E.2d 1036; 820 ILCS
       405/602(A) (West 2012). That section defines “misconduct” as follows:
                “[T]he deliberate and willful violation of a reasonable rule or policy of the employing
                unit, governing the individual’s behavior in performance of his work, provided such
                violation has harmed the employing unit or other employees or has been repeated by
                the individual despite a warning or other explicit instruction from the employing unit.”
                820 ILCS 405/602(A) (West 2012).
¶ 38        “In determining whether an employer was harmed, the employee’s conduct should be
       viewed in the context of potential harm, and not in the context of actual harm.” Manning v.
       Department of Employment Security, 365 Ill. App. 3d 553, 557, 850 N.E.2d 244, 248 (2006)
       (citing Greenlaw v. Department of Employment Security, 299 Ill. App. 3d 446, 448, 701
       N.E.2d 175, 177 (1998)). Plaintiff concedes that he violated Strout’s biosecurity procedures.
       Additionally, plaintiff’s statements at the hearing before the referee clearly showed that he was
       aware he was violating the biosecurity procedure at the time he wore his farm clothes to the
       bathroom in the dirty area of the farm facility. Instead of arguing that his conduct did not
       constitute a violation of the biosecurity procedures, plaintiff argued that others committed
       violations of the biosecurity procedures as well. The Board appropriately rejected plaintiff’s
       claims that he was ignorant of the biosecurity procedures. Further, plaintiff has not claimed at
       any point in these proceedings that Strout’s biosecurity procedures were unreasonable.
       Accordingly, the only questions before us are whether plaintiff’s deliberate and willful
       violation of Strout’s reasonable biosecurity rules (1) resulted in harm to Strout or (2) had the
       potential to harm Strout. Our concluding affirmatively to either question would suffice under
       Manning to affirm the Board’s decision.
¶ 39        Plaintiff argues that his conduct did not have the potential to harm Strout because he never
       reentered the clean area. However, this is an argument against actual harm. Plaintiff’s decision

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       to use the bathroom in the dirty area, without following the mandatory biosecurity procedures,
       had the potential to harm Strout because, had Bishop not stopped him, plaintiff would have
       reentered the clean area without showering through. It was merely fortuitous that Bishop
       located plaintiff before he reentered the clean area. Bishop was not required to let plaintiff
       reenter the clean area in his farm clothes, potentially exposing the pigs to bacterial
       contaminants, before firing him for misconduct.
¶ 40       Plaintiff’s interpretation of section 602(A) of the Act would lead to absurd results. For
       example, under plaintiff’s interpretation, an employee who steals cash from an office safe
       would not be guilty of misconduct so long as the police eventually return the cash to the
       employer. Nor would a restaurant employee who refuses to wash his hands after using the
       bathroom be guilty of misconduct, so long as customers did not become ill as a result.
¶ 41       Plaintiff’s violation of Strout’s biosecurity rules constituted misconduct within the
       meaning of section 602(A) of the Act because it had the potential to cause harm to Strout.
       Specifically, had plaintiff continued his rule violation to its logical conclusion by reentering
       the clean area without showering through, he could have carried bacterial contaminants into
       the clean area and infected the pigs with disease. The Board’s decision was not clearly
       erroneous.

¶ 42                                       III. CONCLUSION
¶ 43       For the foregoing reasons, we reverse the circuit court’s judgment and confirm the decision
       of the Board.

¶ 44      Circuit court reversed; Board confirmed.




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