XUAN PHUONG T TRINH, Employee

METCALFE MADISON
702 BROOKFIELD 638, Employer

An administrative law judge (ALJ) for the Division of Unemployment Insurance of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, it has reviewed the evidence submitted to the ALJ, and it has consulted with the ALJ concerning her impressions as to the credibility of the witnesses. Based on its review, the commission makes the following:

The employee worked for approximately 10 years as a deli clerk for the employer, a grocery store. Her last day of work was September 22, 2002 (week 39), when she was discharged. The issue to be decided is whether the employee was discharged for misconduct connected with her employment, within the meaning of Wis. Stat. § 108.04(5).

On September 15, 2002, the employee was working in the deli. A coworker was preparing fruit salad trays. The employee, who was not working on the fruit salad trays, ate between 6 and 8 pieces of fruit. The value of the fruit consumed by the employee was estimated by the employer to be $1.98.

On September 22, 2002, the employee was informed by the store manager that she was being discharged. He informed her that she had sampled too much fruit and that her time keeping was not correct.

Based on consideration of all of the evidence in the record, the commission finds that the employer's actual reason for deciding to discharge the employee was the matter of the employee's consumption of 6 to 8 pieces of fruit on September 15. While certain issues relating to time keeping were mentioned in connection with the discharge, the commission was satisfied that those issues were not material causes of the employer's decision to discharge the employee and would not have led the employer to discharge the employee absent the matter of her consumption of the fruit salad. According to the employer's policies and practices, the time keeping matters involving the employee would normally result in progressive discipline in the form of warnings. The employer's witness testified that the employee was discharged, instead of being given a lesser form of discipline, because of what the employer considered her excessive consumption of merchandise, and that if the employee had eaten only 1 or 2 pieces of fruit, she would not have been discharged. In addition, the "Associate Status Change Notice" prepared by the employer to formally record the termination of the employee indicated simply that the reason for the termination was "Theft". Therefore the commission has found that the reason for the discharge here was the employer's dissatisfaction over the employee's consumption of fruit on September 15.

The employer had a policy that deli workers were encouraged to "sample" food items in order to determine freshness and taste, or upon a request of a customer who wanted to know about a product's taste. Excessive consumption of food product, however, was considered theft. There was no clear line between what constituted encouraged "sampling" and what constituted prohibited theft. If the employee had consumed only 1 or 2 pieces of fruit, she would not have been discharged; it is inferred from this, that consumption of 1 or 2 pieces of fruit would have been viewed by the employer as being within the range of permitted "sampling".

Even though the boundary between "sampling" and theft was ambiguous, the commission finds based on the testimony of the employee that she was aware, when she was eating the fruit on September 15, that she was eating more fruit than was allowed under the employer's policy on "sampling". The commission is also persuaded, though, that the employee was not aware that her actions in eating that quantity of fruit would be considered so blameworthy by the employer that it would lead it to discharge her.

The employee had worked for the employer for approximately 10 years, always appearing on time, working to the best of her ability, and receiving above average evaluations. She had never received any warnings, verbal or written, concerning her conduct. These circumstances persuade the commission that the employee had a good and positive attitude towards, and took seriously her obligations to, her employer.

The essentially trivial value of the product consumed in this case, as well as the employee's lack of awareness that her consumption of such a small quantity of product would be viewed by her employer as an offense warranting discharge, lead the commission to conclude that the employee did not act with an intentional and substantial disregard of the employer's interests or of her duties and obligations to his employer. While the employee's actions on this one occasion, of consuming more fruit than could be justified as "sampling", were blameworthy, the commission considers the employee's conduct to have reflected the type of isolated good-faith error in judgment or discretion which should not be deemed "misconduct" under the statute.

The commission therefore finds that, in week 39 of 2002, the employee was discharged but that her discharge was not for misconduct connected with her employment, within the meaning of Wis. Stat. § 108.04(5).

The decision of the administrative law judge is reversed. Accordingly, the employee is eligible for benefits beginning in week 39 of 2002, provided she is otherwise qualified. There is no overpayment as a result of this decision.

Dated and mailed July 8, 2003
trinhxu . urr : 110 :    MC 630.16

/s/ David B. Falstad, Chairman

/s/ James T. Flynn, Commissioner

/s/ Robert Glaser, Commissioner

In order to resolve a case presenting the issue of whether a discharge was for misconduct, it is necessary to determine what the employer's actual reasons were for the decision to discharge the employee, whether the employee actually engaged in the conduct that the employer decided to fire her for, what the intent of the employee was in engaging in the conduct at issue, and whether engaging in that conduct, with the intent found, constitutes "misconduct" within the meaning of Wis. Stat. § 108.04(5). See, Wanovich v. Hal's Harley-Davidson (LIRC, May 19, 2003). As is set forth above in the Findings of Fact and Conclusions of Law, the commission has found based on the record herein that the employer decided to discharge the employee because of her consumption of a quantity of the employer's merchandise (in this case, fruit salad), which the employer considered to be theft; and that the employee did indeed engage in the conduct that was the employer's reason for discharging her, that is, consuming a quantity of fruit salad.

In misconduct cases, the "crucial question" is the employee's intent or attitude which attended her act which is alleged to be misconduct. Janzen v. Roehl Transport, Inc. (LIRC, January 31, 2003), citing, Cheese v. Industrial Comm., 21 Wis. 2d 8, 14, 123 N.W.2d 553 (1963). The important question here, is what the employee believed or understood about her conduct and what her intent was in engaging in it.

A factor which complicates this issue, is the employer's acknowledged policy of encouraging its employees to "sample" product, and the ambiguity about where the line was drawn between encouraged conduct ("sampling") and prohibited conduct (theft). In other circumstances, such ambiguity might lead the commission to conclude that improper intent had not been established. See, e.g., Harden v. Schultz SavO Stores (LIRC, Oct. 15, 1992) (no misconduct where grocery employee took 9 pounds of loose grapes, employer's policy with regard to such product being ambiguous). Here, however, the testimony of the employee made it clear that she knew she was eating more than she was supposed to. She acknowledged that if her supervisor had been present, she would not have eaten as much fruit as she did, because she would have been afraid that her supervisor would tell her she could not sample that much. She indicated that according to her understanding of the employer's policy, the amount of fruit she consumed would be considered excessive. For those reasons, the commission found that the employee acted with an intent to do something she knew she should not do under her employer's policies.

However, the fact that the employee was aware that she was consuming more of the employer's product than she was supposed to, is not the only relevant matter concerning the employee's intent. An employee may be aware that they are expected by their employer not to engage in certain conduct, without necessarily being aware that the employer considers it a dischargeable offense. The commission credited the employee's testimony, that she was not aware that eating as much fruit salad as she did would lead the employer to decide to fire her.

Thus, the facts found by the commission in this matter were that the employee intentionally took (by consuming it) a quantity of her employer's property, of a value less than $2, with the knowledge that she should not do so, although not with the knowledge that her conduct would lead the employer to decide to discharge her. The question then becomes, whether this was "misconduct".

Intentional theft of property of significant value from one's employer is clearly "misconduct" within the meaning of Wis. Stat. § 108.04(5). See, e.g., Fales v. Dickerson Stations Inc. (LIRC, Sep. 10, 1999) (theft of $553 in cash); Lindberger v. Superconductivity and LIRC (No. 00 CV 17898, Dane Co. Cir. Ct., March 29, 2001) (theft of thousands of dollars of property and materials); Ziska v. Ferrellgas Inc. (LIRC, Oct. 10, 1997) (theft of $200 cash payment made by a customer). However, an important factual circumstance in this case is that the value of the property consumed by the employee was very small.

It is possible to take different views on the question of whether theft of property of trivial value is "misconduct" under § 108.04(5). While the "misconduct" standard could be viewed as applying to theft of property of trivial value, on the theory that intentional theft is a sufficiently serious breach of trust that it always has a significant negative effect on the employer's interests, it could also be viewed as not necessarily applying to theft of property of trivial value, on the theory that where the value of the property taken is minimal, the effect on the employer's interests is de minimis. Over the years a number of decisions dealing with this question have been issued by the commission and by reviewing courts. At various times and in various contexts, both of these views have been reflected in such decisions.

As noted, one tendency has been to consider the de minimis value of item(s) stolen or consumed to be irrelevant to the question of whether the taking was "misconduct". This approach is reflected in a commission decision issued in 1964 and reported in the Unemployment Compensation Digest at section MC 630.16, "Theft (value trivial)", this way:

64-A-2108(C) A textile employe was discharged when his employer investigated an anonymous tip and found some of its property at his farm. He admitted having taken some burlap bags without permission. He contended that his action was excusable because the value of the property was small, and because he had obtained permission to remove other property on prior occasions and other employes had taken property without permission over a long period of time.

Held disqualified. The commission has held that stealing the property of an employer, regardless of whether it has only nominal value is inexcusable. It did not appear that this employer condoned the taking of property without permission or that it knew that that was done. The fact that the employe had asked permission on other occasions indicated that he understood that permission was required.

Another tendency has been to consider that, to the extent the value of the items taken is insubstantial, the degree of the wrong done to the employer's interests is similarly insubstantial. This approach is reflected in another commission decision, also issued in 1964, and reported as follows the same section of the Unemployment Compensation Digest:

64-C-80 A cook at a county institution violated a rule prohibiting employes from consuming any of the institution's food supplies. She drank a glass of buttermilk from the institution's stores in order to relieve a spell of illness. She was given notice that because of her infraction she was discharged effective in 2 weeks. She was emotionally upset by her discharge and she did not report for work after receiving the notice. Her employer alleged that she quit, and the deputy and the appeal tribunal denied benefits on the ground alleged.

Held that she was discharged, and not for misconduct. The employer's rule was not unreasonable and the employe's infraction thereof was not condoned by the Commission. Her offense was one which may well have warranted a warning or reprimand. But her offense was not of such severity or significance as to constitute misconduct in the absence of evidence that it was habitual or in violation of warnings.

Both of these views have also found approval in the courts. Thus, for example, a circuit court affirmed the commission's decision in the "glass of buttermilk" case mentioned above, stating that the commission's conclusion that the infraction was not so severe or significant that it was misconduct, was the only reasonable conclusion that could be reached. Milwaukee County v. Kaap & Industrial Comm., No. 115-370 (Dane Co. Cir. Ct., Jan. 11, 1965). The circuit court expressed approval for the ideas expressed in an unemployment compensation decision from Michigan (Parke Davis & Co. vs. Mich E.S.C.), to the effect that misconduct in connection with work

"must be of sufficient severity to give real concern. Here it appears that the 'de minimis' doctrine applies. Admittedly the action of the claimant was wrong, but to put into motion all of the severe penalties attendant upon a declaration of misconduct in connection with his work appears to be basically unjust and inequitable. "

In contrast, however, is Matthews and Trickle v. LIRC and Sambo's Restaurant, Nos. 81-CV-399 and 81-CV-400 (Wood Co. Cir. Ct., May 18, 1982), in which the circuit court affirmed a commission decision finding misconduct in the case of two waitresses who stole, respectively, a ham and cheese sandwich, and a ham and cheese sandwich with a side order of onion rings. The commission had rested its conclusion in part on the notion that due to the nature of the employer's business and operations, it could not be said that the harm to the employer was insignificant. The circuit court clearly felt the same way, remarking that

. they're doing the same thing as taking money out of the till, and in the restaurant business, when you get nickeled and dimed like that, it's what really kills you, either by food or by money disappearing from the till.

The differing views that can be taken on this issue were well illustrated in a series of decisions issued in a single case. In a decision issued in the early 1980's, Richard Lueck v. A. O. Smith Corp, the commission found misconduct where an employee had stolen a few pieces of what was apparently conceded to be scrap steel. The circuit court reversed the commission, and it was clear that it was very strongly inclined to the view that theft of items of de minimis value should not be considered serious enough to constitute misconduct. Richard Lueck v. LIRC and A. O. Smith Corp., No. 83-CV-1269 (Waukesha Co. Cir. Ct., May 30, 1984). After noting that the employe was discharged "after sixteen years of model employment", and noting that the Boynton Cab case cautioned that the misconduct standard should be strictly construed so as to give it the construction which is least favorable to working a forfeiture, the circuit court said:

In light of the Boynton case . . . it is this Court's determination that the plaintiff's actions do not evince the evil intent or willful and wanton disregard of an employer's interests necessary to the classification of misconduct. The plaintiff took scrap, any interest of the employer in it was certainly minimal if not totally non-existent. . . . [I]t is clear that to dismiss an employee with a sixteen model year work record for taking scrap is absolutely unreasonable and does not amount to misconduct as a matter of law.

(emphasis added). However, the commission appealed, and in an unpublished per curiam decision, Richard Lueck v. LIRC and A. O. Smith Corp., No. 84-1199 (Ct. App. Dist. II, June 5, 1985), the Court of Appeals reversed the circuit court and reinstated the commission's conclusion of misconduct. The Court of Appeals opined that there had been a rational basis for the commission's decision, that the employee's actions were contrary to the interest of his employer in maintaining an enforceable procedure for controlling the circumstances under which scrap left its premises.

In more recent years, there has been some tendency towards the expression of an "absolutist" position, that theft of an employer's property is always misconduct and that it is completely irrelevant whether the value of the property is trivially small. It is possible to connect the development of this tendency to the emergence of a belief that the Wisconsin Supreme Court had endorsed the position. However, that belief is mistaken.

In a 1984 decision, Alan Weiley v. LIRC and Marc Plaza Hotel, No. 626-822 (Milw. Co. Cir. Ct., October 12, 1984), the Milwaukee County Circuit Court affirmed a commission decision finding misconduct in the case of an employee who had taken four bags of disposable cups, of a total value of $3. The court supported its decision by citing to a Wisconsin Supreme Court case, Weibel v. Clark, 87 Wis.2d 696, 275 N.W. 2d 686 (1979), describing it as a case in which an employee had "merely stuffed a few candy bars in his shirt", and suggesting that in Weibel the Supreme Court had upheld a conclusion of misconduct because "the fact that the value of the goods was a mere pittance had no bearing on the legal conclusion that the theft constituted misconduct".

In fact, the Weiley circuit court was incorrect about Weibel v. Clark, in two respects. First, the Supreme Court's decision in the Weibel case had been explicitly and specifically limited to a procedural, due process issue involving the scope of the notice of hearing; the Court's opinion said nothing whatsoever about the misconduct standard. Second, the value of the property taken in the Weibel case was in fact hardly a "pittance"; the employee had purloined chocolate Easter eggs worth approximately $40 to $50 (and that in 1974 dollars!). Thus, Weibel was simply not a "trivial value" theft case at all.

However, after Weiley the notion that Weibel v. Clark stood for the proposition that theft is always misconduct even if the property taken is of trivial value, began to appear in other decisions. For example, in a 1985 decision, Raymond Kopel v. Allstate Insurance Co. (LIRC, December 10, 1985), the commission found misconduct in a case involving theft of three cans of soda pop, valued at 45 cents apiece. The commission's decision incorporated verbatim the discussion of the circuit court in Weiley referred to above.

Then in a 1991 decision, the Marathon County Circuit Court affirmed a commission decision finding misconduct in the case of an employee who had taken two small round wooden discs, 15 wood screws, two or three pieces of sandpaper, a small bottle of glue, and a small metal shaft. In its decision, Meverden v. LIRC and Kolbe and Kolbe Millwork Co., No. 89-CV-586 (Marathon Co. Cir. Ct., Feb. 28, 1991), the circuit court articulated an absolute "no theft is de minimis" approach, asserting that:

Clearly, stealing is a type of activity which has "wrongful intent or evil design". When an employe steals, he is acting with "intentional and substantial disregard of the employer's interests". The value of the items stolen are immaterial.

(emphasis added). The commission cannot discount the possibility that the Meverden court's decision was affected by the fact that, in its brief to the court, the commission had cited to Weibel v. Clark as a decision which held that a theft of "a small amount of candy" was misconduct, and had also relied upon (and submitted a copy of) the Weiley circuit court decision, with its mischaracterization of Weibel.

In view of the history discussed above, the commission has taken a fresh look at the issue of whether or under what circumstances theft of property of trivial value should be considered "misconduct", and it has concluded that the issue is simply not one that is well suited to absolute pronouncements. If any generalization may appropriately be made in this area, the commission believes that it is this one, which was made by the circuit court in Weiley:

[t]he value amount of the goods does not necessarily play a role in the determination of whether a theft is statutorily misconduct.

(emphasis added). That is, in particular cases, the de minimis value of property taken may or may not be relevant to the question of whether there was misconduct. Thus, there may be cases in which the nature of an act of theft and the employee's intent in engaging in it is such an assault on the relationship of trust which must exist between an employer and its employees, that it is appropriate to find misconduct even where the value of the property is minimal. For example, in the Matthews and Trickle case, supra, the value of the food taken was relatively small, but the method used by the employees to commit the theft -- submitting to the kitchen falsely marked up customer tickets creating the false appearance that additional food items had been ordered -- made it clear that the act was premeditated and could not have been a matter of a momentary lapse of judgment. On the other hand, there may be cases in which the trivial value of the property taken is an important factual element in an overall situation which warrants a conclusion of no misconduct.

The commission concludes that this is the latter type of case, for several reasons.

First, the value of the product consumed here was very small. The few pieces of fruit salad consumed here are comparable to the glass of buttermilk consumed by the employee in the Kaap case. Second, there is the distinguishing circumstance here, of the employer's ambiguous policy concerning "sampling". While it does not alter the fact that the employee was intentionally taking from the employer more than she knew she should, the vague line between encouraged sampling and prohibited theft requires that consideration be given to the value of the property involved. Third, while the employee knew that she was consuming more fruit than she should, the commission is satisfied that she did not know that the employer would take the matter so seriously that she would be discharged for it. The employee so testified, and the commission credits that testimony. While it is true that the employee manual did contain a provision concerning theft that referred to the cumulative effect of the taking of small items, it did not clearly indicate that an employee would be discharged for theft no matter how small the value of the items taken. To the extent that the language in the employee handbook could be argued to have implied that, any such implication was undercut by the ambiguity of the employer's policy concerning "sampling". Also, the commission had some question about the extent of the employee's ability to understand the policies stated in the employee manual, given the fact that English was not her native language and that she actually understood little English when she began working for the employer. Finally, the circumstances here include the fact that this employee was, as the administrative law judge found, a hardworking employee who had worked for the employer for approximately 10 years without incident, receiving good evaluations, always on time, calling in absent on only 2 occasions when her mother was sick. These are circumstances that can be looked to as an indication that her conduct here which led to her discharge, being so inconsistent with an otherwise good employment history, was in the nature of the kind of isolated good-faith error in judgment or discretion referred to by the Court in Boynton Cab.

For all of the foregoing reasons, the commission has concluded that the actions of the employee in this matter as a result of which the employer made the decision to discharge her, did not constitute "misconduct" within the meaning of Wis. Stat. § 108.04(5).

NOTE: As noted above, the commission consulted with the administrative law judge concerning her impressions as to the credibility of the witnesses. See, Carley Ford, Lincoln, Mercury v. Bosquette, 72 Wis.2d 569, 575, 241 N.W.2d 596 (1976).

The commission had no disagreement with the material findings of fact made by the administrative law judge, with one exception. The administrative law judge's decision included a statement to the effect that the employee "knew or should have known" that her actions were prohibited by the employer's policies and could lead to discharge. While the commission agreed that the employee knew that her actions were prohibited by the employer's policies (that is, that she was consuming more fruit than would have been allowed by the employer's "sampling" policy), for the reasons stated above, supra at pp. 2, 4, it did not agree that the employee knew that her actions could lead to discharge.

Apart from the matter of that disagreement, the commission would note that it found the administrative law judge's "knew or should have known" statement to be problematic in form. As is stated above, an employee's intent and attitude in engaging in the conduct in question is a crucial issue in a misconduct case. To state disjunctively that an employee actually knew that what they were doing was wrong, "or" that they did not know but should have known, is to equivocate on this crucial issue. In misconduct cases, the decisionmaker should decide this issue one way or the other.

cc: 
Sentry Foods
Ms. Laura Schulteis

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