                                FILED
                                November 30, 1999

                                Cecil Crowson, Jr.
                               Appellate Court Clerk
        IN THE COURT OF APPEALS OF TENNESSEE
                    AT NASHVILLE



DAVID E. KELLY,                       )
                                      )
      Plaintiff/Appellant,     )
                            )               Davidson Chancery
VS.                         )               No. 98-458-II
                            )
THE TENNESSEE CIVIL SERVICE )
COMMISSION and              )               Appeal No.
THE TENNESSEE DEPARTMENT )                  M1999-00168-COA-R3-CV
OF LABOR,                   )
                            )
     Defendants/Appellees.  )



   APPEAL FROM THE CHANCERY COURT FOR DAVIDSON COUNTY
                 AT NASHVILLE, TENNESSEE

            THE HONORABLE CAROL L. McCOY, CHANCELLOR



For the Plaintiff/Appellant:                      For the Defendants/Appellees:

Frank J. Scanlon                                  Paul G. Summers
Watkins, McGugin, McNeilly & Rowan                Attorney General and Reporter
Nashville, Tennessee
                                                  William J. Marett, Jr.
                                                  Assistant Attorney General




                                                                                  Page 1
AFFIRMED AND REMANDED




           WILLIAM C. KOCH, JR., JUDGE




                                         Page 2
                                 OPINION


      This appeal involves the two-day suspension of an employee of the Tennessee
Department of Labor. After the Tennessee Civil Service Commission upheld the
suspension, the employee filed a petition for judicial review in the Chancery Court
for Davidson County challenging the factual basis of the Commission’s decision and
asserting that the Department acted arbitrarily and capriciously. The trial court,
sitting without a jury, affirmed the suspension. On this appeal, the employee admits
violating departmental policy but asserts that he should have received less serious
discipline or no discipline at all. We affirm the trial court’s decision upholding the
employee’s two-day suspension.


                                          I.


      David E. Kelly has worked for the State of Tennessee for approximately
twenty years, the last eleven with the Department of Labor.        He served as the
Department’s director of management systems until 1993 when he was demoted for
poor job performance. 1 Mr. Kelly continued to work as one of the Department’s
seven systems analysts and was assigned to the Division of Workers’
Compensation.     In addition to his responsibilities to the Division of Workers’
Compensation, Mr. Kelly also served as the Department’s security administrator and
was responsible for controlling access to all of the Department’s mainframe
computers.


      Mr. Kelly’s performance evaluations were generally good following his
demotion. However, three incidents occurred between late 1994 and mid-1995 that
caused the Department to discipline him. The first incident involved Mr. Kelly’s
reluctance to assist newer systems analysts 2in gaining access to the Department’s
mainframe computers even though the Commissioner had directed the systems
analysts to cooperate with each other. Despite repeated requests between December
1994 and July 1995, Mr. Kelly declined to assist one of the Department’s newer


                                                                                         Page 3
analysts gain needed access to the computer. Mr. Kelly later explained his conduct
by stating that he was “totally frustrated with them badgering 3 me to do stuff that was
not my job to do.”
      The second incident reflecting on Mr. Kelly’s job performance involved his
delay in complying with the Department’s human resources director’s instructions to
clear the hallway near his office. In late 1994, the director instructed Mr. Kelly to
clear the hallway of equipment and boxes that had accumulated on the floor, the
windowsills, and top of the filing cabinets in violation of the fire code and the
Americans with Disabilities Act. By June 1995, Mr. Kelly had removed the items
from the floor but had not removed the items from the filing cabinets or windowsills.
 Mr. Kelly told the director that he would remove the remaining items as soon as he
found space and eventually completed the task in September 1995.


      The third incident involved Mr. Kelly’s unapproved attendance at a four-day
educational seminar in July 1995. Mr. Kelly did not notify his superiors that he was
attending the seminar and did not obtain prior approval as required by the
Department’s policy.       Mr. Kelly later explained that he “forgot” to follow
departmental procedures for obtaining advance approval for training but also stated
that he had not attended many seminars because the Department’s human resources
director “gave me a hassle anytime I asked for a class.” Mr. Kelly left the course
early without completing it because he was needed at the Department. He later
apologized to the acting director of management systems, saying that he “didn’t
know it was going to be this big a deal. . . . I just forgot to fill out the paperwork. I’
m sorry. If it bothers you that much I’ll pay for the course myself.”


      On July 19, 1995, the acting director of management systems asked the
Commissioner to suspend Mr. Kelly for three days for violating the Department’s
policies and for failing to carry out direct instructions.      On July 31, 1995, the
Commissioner suspended Mr. Kelly from work for three days after taking the three
incidents and Mr. Kelly’s earlier demotion into consideration. Following an informal
hearing presided over by the Department’s legal director, the Commissioner



                                                                                             Page 4
shortened Mr. Kelly’s suspension to two days.


      Mr. Kelly pursued a Step V grievance to the Tennessee Civil Service
Commission. Following a hearing, an administrative law judge employed by the
Secretary of State concluded that Mr. Kelly’s 1993 demotion should not have been
considered and that Mr. Kelly’s acts did not constitute insubordination. According,
the administrative law judge reduced Mr. Kelly’s two-day suspension to an oral
warning and awarded him partial attorney’s fees. At the Department’s request, the
Civil Service Commission reviewed the administrative law judge’s interim order.
While it adopted the administrative law judge’s findings of fact, the Commission
concluded that the evidence established insubordination and violation of
departmental policies. Accordingly, the Commission reinstated Mr. Kelly’s two-day
suspension and vacated the award of attorney’s fees.


      Mr. Kelly filed a petition for judicial review in the Chancery Court for
Davidson County seeking to overturn the Civil Service Commission’s decision. On
April 27, 1999, the trial court affirmed the Commission’s decision after determining
that Mr. Kelly’s suspension was not contrary to law, arbitrary or capricious, or
unsupported by the evidence. The trial court also rejected Mr. Kelly’s argument that
the Commission acted arbitrarily and capriciously by considering his 1993 demotion
when determining whether his punishment was appropriate. Mr. Kelly now appeals
from the trial court’s decision.


                                        II.
                      Evidentiary Support for the Suspension


      Mr. Kelly’s chief argument on this appeal is that the Department failed to
present substantial and material evidence that his two-day suspension was warranted.
 While he does not insist that he was completely blameless, Mr. Kelly asserts that
the two-day suspension was too harsh and that either a less harsh punishment or no
formal punishment at all would have been warranted.       We find that the record



                                                                                       Page 5
supports the Commissioner’s decision.


                                          A.
                                Standard of Review


      Judicial review of decisions by the Tennessee Civil Service Commission are
governed by the Tennessee Uniform Administrative Procedures Act.             See Tenn.
Code Ann. § 4-5-322(a)(1) (1998). Trial and appellate courts use the same standard
of review. See Ware v. Greene, 984 S.W.2d 610, 614 (Tenn. Ct. App. 1998);
Estate of Street v. State Bd. of Equalization, 812 S.W.2d 583, 585 (Tenn. Ct. App.
1990). When the factual support for an administrative decision is challenged, the
courts must examine the entire record to determine whether the decision is supported
by substantial and material evidence. See Tenn. Code Ann. § 4-5-322(h)(5) (1998).


      The substantial and material evidence standard requires a searching and
careful inquiry into the record to determine the basis for the administrative decision.
See Sanifill of Tennessee, Inc. v. Tennessee Solid Waste Disposal Control Bd., 907
S.W.2d 807, 810 (Tenn. 1995); Wayne County v. Solid Waste Disposal Control Bd.
, 756 S.W.2d 274, 280 (Tenn. Ct. App. 1988). Courts do not reweigh the evidence
in these cases, see Humana of Tennessee v. Tennessee Health Facilities Comm'n,
551 S.W.2d 664, 667 (Tenn. 1977); Jackson Mobilphone Co., Inc. v. Tennessee
Pub. Serv. Comm'n, 876 S.W.2d 106, 111 (Tenn. Ct. App. 1993), but rather review
the record for “such relevant evidence as a reasonable mind might accept to support
a rational conclusion and such as to furnish a reasonably sound basis for the action
under consideration.” Southern Ry. Co. v. State Bd. of Equalization, 682 S.W.2d
196, 199 (Tenn. 1984).


      We may not reverse an administrative decision supported by substantial and
material evidence solely because the evidence could also support another result. See
Hughes v. Bd. of Comm'rs, 204 Tenn. 298, 305, 319 S.W.2d 481, 484 (1958);
Metropolitan Gov’t of Nashville and Davidson County v. Tennessee Solid Waste



                                                                                          Page 6
Disposal Control Bd., 832 S.W.2d 559, 561 (Tenn. Ct. App. 1991). Courts may
reject an agency's factual findings only if a reasonable person would necessarily
draw a different conclusion from the record. See Jones v. Greene, 946 S.W.2d 817,
828 (Tenn. Ct. App. 1996).


                                            B.
                            The Evidence Against Mr. Kelly


          The state civil service rules permit supervisors to discipline employees “
whenever just or legal cause exists.” Tenn. Comp. R. & Regs. r. 1120-10-.02
(1988). The record before us contains substantial and material evidence that Mr.
Kelly refused to accept reasonable and proper assignments from his superiors, 4that
he failed to maintain satisfactory and harmonious working relationships with his
fellow employees, 5and that he disrupted the normal operation of the Department and
interfered with his superiors’ ability to manage. 6


          Mr. Kelly did not comply in a timely or cooperative manner with his superiors
’ repeated requests to assist other systems analysts seeking access to the
Department’s mainframe computer or to clear the hallway of materials. He also
ignored the Department’s policy requiring advance approval for training.          This
conduct reflects the absence of a satisfactory and harmonious relationship between
Mr. Kelly and the other systems analysts and the Department’s temporary director of
management systems. The conduct also caused disruption within the Department
because Mr. Kelly’s coworkers’ efficiency was impaired when they could not gain
access to the Department’s mainframe computer, and when Mr. Kelly was not
available to perform needed work because he was attending training away from the
office.


          Both the Department’s legal counsel and the administrative law judge
characterized Mr. Kelly’s conduct as “disorganized” and “negligent” rather than
insubordinate. However, the record contains substantial and material evidence that



                                                                                          Page 7
supports both the Department’s and the Civil Service Commission’s conclusion that
Mr. Kelly was insubordinate. His lack of respect for his superiors is reflected in his
sarcastic responses when he was questioned about the unauthorized training, in his
petulant objections to the “cross-training thing” – his reference to his superiors’
direction that the systems analysts work together rather than independently, and in
his purposeful delay in carrying out assignments with which he did not agree.


                                         III.
            The Arbitrariness and Capriciousness of the Suspension


      Mr. Kelly also asserts that there are two reasons why the Commissioner’s and
the Civil Service Commission’s decision to suspend him for two days was arbitrary
and capricious. First, he argues that his conduct, even if proven by substantial and
material evidence, did not warrant such harsh punishment. Second, he insists that
the Commissioner and the Civil Service Commission should not have taken his 1993
demotion into account in considering the appropriate discipline for these three
offenses.


      Courts may modify or overturn a decision by an administrative agency that is
“[a]rbitrary or capricious or characterized by abuse of discretion or clearly
unwarranted exercise of discretion.”     Tenn. Code Ann. § 4-5-322(h)(4).        This
standard of review, while akin to the standard in Tenn. Code Ann. § 4-5-322(h)(5),
requires the court to determine whether the administrative agency made a clear error
in judgment. See Jackson Mobilphone Co. v. Tennessee Pub. Serv. Comm’n, 876
S.W.2d at 110-11. An arbitrary decision is one that is not based on any course of
reasoning or exercise of judgment, see State ex rel Nixon v. McCanless, 176 Tenn.
352, 354, 141 S.W.2d 885, 886 (1940), or that disregards the facts or circumstances
of the case without some basis that would lead a reasonable person to reach the
same conclusion. See Jackson Mobilphone Co. v. Tennessee Pub. Serv. Comm’n,
876 S.W.2d at 111.




                                                                                         Page 8
      Tennessee’s civil service statutes and rules incorporate the doctrine of
progressive discipline.    Accordingly, supervisors are expected to administer
discipline beginning at the lowest appropriate step.       See Tenn. Code Ann. §
8-30-330(a), (c) (1993); Tenn. Comp. R. & Regs. r. 1120-10-.07 (1996).
Progressive discipline does not require a supervisor to begin at the lowest level of
discipline regardless of the nature of the employee’s conduct. It simply means that
the supervisor should impose the lowest appropriate punishment taking into account
the nature or severity of the employee’s behavior. Accordingly, supervisors have
the discretion to determine what punishment fits the offense. See Berning v. State
Dep’t of Correction, 996 S.W.2d 828, 830 (Tenn. Ct. App. 1999).


      We do not sit as some sort of super Civil Service Commission when we
review cases involving the discipline of state employees. Based on Mr. Kelly’s
conduct, we cannot fault either the Commissioner or the Civil Service Commission
for not giving him either an oral or written warning or some other lesser punishment.
Nor can we fault the Commissioner for decreasing Mr. Kelly’s suspension from
three to two days. As one member of the Civil Service Commission observed, Mr.
Kelly was “lucky to get by with a two day suspension.” Based on the evidence in
this record, we decline to conclude that Mr. Kelly’s supervisors abused their
discretion by setting his punishment at a two-day suspension.


      Likewise, we decline to find that either the Commissioner or the Civil Service
Commission acted arbitrarily or capriciously by arriving at Mr. Kelly’s discipline in
light of his entire work history, including his 1993 demotion. While prior disciplinary
actions have no bearing on whether an employee has engaged in work-related
conduct that warrants discipline, an employee’s prior conduct, both good and bad,
can be considered when determining what the appropriate disciplinary action should
be. See Tennessee Dep’t of Human Servs. v. Mahon, No. 01A01-9504-CH-00143,
1995 WL 581086, at *4 (Tenn. Ct. App. Oct. 5, 1995) (No Tenn. R. App. P. 11
application filed) (citing the employee’s “long history of progressive discipline
coupled with no overall improvement”); Memphis & Shelby County Health Dep’t v.



                                                                                          Page 9
Bailey, Shelby Eq., slip op. at 3 (Tenn. Ct. App. Dec. 6, 1984) (No Tenn. R. App.
P. 11 application filed) (stating that an employee’s prior record was admissible in
determining punishment once the fact of the employee’s conduct has been settled).


      The administrative law judge permitted Mr. Kelly to, in effect, collaterally
attack the validity of his 1993 demotion.       In its order upholding the two-day
suspension, the Civil Service Commission expressly held that “both the
Administrative Law Judge’s decision to admit evidence on the Grievant’s 1993
disciplinary demotion which was not grieved and the Administrative Law Judge’s
decision that the demotion could not be relied upon as a prior act of progressive
discipline constitute reversible error in this action.” We agree with the Civil Service
Commission’s conclusion on these issues.
                                         IV.


      We affirm the judgment and remand the case to the trial court for whatever
further proceedings may be required. We also tax the costs of this appeal to David
E. Kelly and his surety for which execution, if necessary, may issue.



______________________________
                                               WILLIAM C. KOCH, JR., JUDGE


CONCUR:


________________________________
BEN H. CANTRELL,
PRESIDING JUDGE, M.S.



________________________________
WILLIAM B. CAIN, JUDGE




                                                                                          Page 10
