This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2002).
IN COURT OF APPEALS
Jennie-O Foods, Inc.,
Commissioner of Economic Security,
Commissioner of Economic Security
File No. 37802
John E. Mack, Mack & Daby, P.A., 26 Main Street, P.O. Box 302, New London, MN 56273 (for relator)
Jennie-O Foods, Inc., 1159 East Main Street, Willmar, MN 56352 (respondent)
M. Kate Chaffee, Lee B. Nelson, Department of Economic Security, 390 North Robert Street, St. Paul, MN 55101 (for respondent Commissioner)
Considered and decided by Shumaker, Presiding Judge, Randall, Judge, and Wright, Judge.
Relator challenges the decision of the Commissioner of Economic Security that relator was discharged for employment misconduct and is, therefore, ineligible to receive unemployment benefits. We affirm.
Respondent Jennie-O Foods, Inc. (Jennie-O) hired relator Michael Smith as a loading supervisor on April 2, 2000. Smith was responsible for the “efficient loading and delivery of turkeys” to Jennie-O’s processing plants. Jennie-O’s live-haul policy prohibits loading supervisors from damaging Jennie-O property and requires supervisors to ensure that turkeys arrive at the processing plant alive and “are handled in a manner as to minimize downgrading.” The live-haul policy defines downgrading as handling turkeys in a manner that causes bruising or breakage, which precludes a “grade A” classification. According to the live-haul policy, the penalty for the first offense of “intentional damage to * * * Company property” is discharge. Any employee action or omission that results in harm to Jennie-O or interferes with its rights or property interests, “may subject the offender to disciplinary action,” including discharge.
During Smith’s orientation at Jennie-O, he signed a checklist, indicating that he received and understood the employee handbook and the discipline and attendance policies. Smith also received the live-haul policy at the start of his employment.
During the night of November 18, 2001, Smith supervised a crew of three loaders at the Norling Crown turkey farm. The next morning, the grower complained about Smith killing turkeys during the loading. When Allan Schmidt, Smith’s supervisor, received the complaint, he spoke with the crew members individually about the loading at the Norling Crown farm. All of the crew members indicated that they observed Smith handling the turkeys in a rough and damaging manner. One crew member reported that Smith swung at least ten birds by the head, resulting in harm to the turkeys. When Schmidt met with Smith to discuss the allegations, Smith did not deny killing the turkeys. Jenny-O discharged Smith for damaging its property by beating and killing the turkeys.
Smith applied for unemployment benefits. The Department of Economic Security denied Smith unemployment benefits, because his discharge resulted from employee misconduct. Smith appealed that decision.
At the hearing before the unemployment law judge, Smith admitted “rough handling,” which could have downgraded the turkeys. But Smith claimed that the loading equipment could have caused the deaths. Finding that Smith disregarded the standards of behavior Jennie-O had a right to expect, the unemployment law judge denied Smith’s application for benefits.
Smith appealed to the Commissioner of Economic Security, who affirmed the unemployment law judge’s decision, stating,
[w]e are fully persuaded that the applicant’s course of conduct constituted a total disregard of the standards of behavior which the employer had a right to expect of him and constituted employee misconduct.
Smith then petitioned this court for writ of certiorari, which we granted.
On appeal, we review the commissioner’s decision, not that of the unemployment law judge. Tuff v. Knitcraft Corp., 526 N.W.2d 50, 51 (Minn. 1995). Reviewing the findings of fact in the light most favorable to the commissioner’s decision, we will not disturb factual findings, provided the evidence reasonably tends to sustain them. Ress v. Abbott N.W. Hosp., Inc., 448 N.W.2d 519, 523 (Minn. 1989). Whether an employee committed disqualifying misconduct is a mixed question of fact and law. Colburn v. Pine Portage Madden Bros., Inc., 346 N.W.2d 159, 161 (Minn. 1984). Whether the employee committed a particular act is a question of fact. Scheunemann v. Radisson S. Hotel, 562 N.W.2d 32, 34 (Minn. App. 1997). Whether the act constitutes misconduct is a question of law, which we review de novo. Ress, 448 N.W.2d at 523.
An employee who is discharged for misconduct is disqualified from receiving unemployment benefits. Minn. Stat. § 268.095, subd. 4(1) (2002). Employment misconduct is defined as
any intentional conduct, on the job or off the job, that disregards the standards of behavior that an employer has the right to expect of the employee or disregards the employee’s duties and obligations to the employer.
Id., subd. 6(a)(1) (2002).
We apply a two-pronged test to determine whether an employee’s actions constitute intentional “employment misconduct” within the meaning of Minn. Stat. § 268.095, subd. 6(a)(1). Houston v. Int’l Data Transfer Corp., 645 N.W.2d 144, 149 (Minn. 2002). The employee’s conduct must “(1) be intentional and (2) disregard standards of behavior the employer has a right to expect or the employee’s duties and obligations to the employer.” Id. The second prong of the Houston test requires an analysis of the employee’s intent that is “separate and distinct” from the intentional conduct required in the first prong. Id. at 150. Thus, the Houston test for employment misconduct requires
that the employee not only engaged in intentional conduct, but also intended to, or engaged in conduct that evinced an intent to, ignore or pay no attention to his or her duties and obligations or the standards of behavior the employer has a right to expect.
A single isolated incident based on a misunderstanding, or a good-faith error in judgment not adversely affecting the employer’s interests is not sufficient to find intentional misconduct. Sticha v. McDonald’s No. 291, 346 N.W.2d 138, 140 (Minn. 1984) (finding no disqualifying misconduct where employee inadvertently misled employer to believe employee was taking time off for funeral rather than wake). Instead, to satisfy the first prong of the Houston test, the conduct must be deliberate and not accidental. Houston, 645 N.W.2d at 149 (citing Ress, 448 N.W.2d at 524; Am. Family Ins. Co. v. Walser, 628 N.W.2d 605, 611 (Minn. 2001)).
Smith argues that Jennie-O did not produce sufficient competent evidence to demonstrate that he engaged in disqualifying employee misconduct. The conduct at issue here is handling the turkeys in a manner that caused damage to Jenny-O’s property. There is no evidence in the record that suggests that the damage to the turkeys was the result of Smith’s accidental conduct. Rather, the evidence supports the finding that Smith intentionally damaged Jenny-O’s property. Thus, the first Houston prong is satisfied.
The Houston test also requires an employee to intend to disregard the standards of behavior the employer had a right to expect. Houston, 645 N.W.2d at 150. Smith contends that, because Jennie-O’s live-haul policy does not constitute an employment contract, the standards of behavior Jennie-O has a right to expect of its employees cannot be based on this policy. We disagree. The source for employment standards is not limited to employment contracts. Montgomery v. F & M Marquette Nat’l Bank, 384 N.W.2d 602, 604 (Minn. App. 1986), review denied (Minn. June 13, 1986). We may also review an employer’s policies, rules, and reasonable requests when determining whether an employee has disregarded the conduct the employer has the right to expect. Id.; see, e.g., Schmidgall v. FilmTec Corp., 644 N.W.2d 801, 805 (Minn. 2002) (injury reporting policy); McGowan v. Executive Express Transp. Enter., 420 N.W.2d 592, 595-96 (Minn. 1988) (reasonable request to pick up prescription); Heilman v. United Dressed Beef Co., 273 N.W.2d 628, 629-30 (Minn. 1978) (request to trim rib sections); Sivertson v. Sims Sec. Inc., 390 N.W.2d 868, 871 (Minn. App. 1986) (security guard policy), review denied (Minn. Aug. 20, 1986); Dean v. Allied Aviation Fueling Co., 381 N.W.2d 80, 83-84 (Minn. App. 1986) (baggage policy); Ruzynski v. Cub Foods, Inc., 378 N.W.2d 660, 663 (Minn. App. 1985) (time card policy); Duc Van Luu v. Carley Foundry Co., 374 N.W.2d 582, 585 (Minn. App. 1985) (absenteeism policy). Here, the live-haul policy outlines the duties of the loading supervisor, explains how the policy can be violated, and describes penalties for policy violations. The live-haul policy clearly establishes standards of behavior Jennie-O has a right to expect of its employees.
We find no merit in Smith’s argument that his manner of handling the turkeys was necessary under the circumstances. The farm manager’s complaints and the crew members’ statements that they witnessed Smith beating and killing birds belie Smith’s contention. The record before us contains ample support for the commissioner’s finding that Smith’s actions evinced the requisite intent to disregard the standards of behavior Jennie-O has a right to expect. Thus, the second Houston prong is satisfied. The record supports the commissioner’s determination that Smith engaged in disqualifying employment misconduct.
Smith also argues that the commissioner’s determination is erroneously founded on unreliable hearsay evidence. On review, we give substantial “deference to the fact-finding processes of the administrative agency.” Taylor v. Beltrami Elec. Coop., Inc., 319 N.W.2d 52, 56 (Minn. 1982) (quotation omitted). Hearsay evidence may be considered “if it is the type of evidence on which reasonable, prudent persons are accustomed to rely in the conduct of their serious affairs.” Minn. R. 3310.2922 (2001). We will not reverse an agency’s decision unless the agency clearly abused its discretion in relying upon inherently unreliable evidence. Id.; see also Minn. Stat. § 14.60, subd. 1 (2002) (stating that an agency may exclude incompetent, irrelevant, immaterial and repetitious evidence). The nature and quality of the evidence here do not arguably approach the standard that would warrant reversal.
Having received a copy of the live-haul policy, Smith was aware that Jennie-O expected him to handle turkeys in a manner that minimized downgrading. He also knew that intentional damage to Jennie-O’s property would result in being discharged. There is ample evidence in the record to show that Smith intentionally mishandled the turkeys and thereby intentionally ignored the standards of behavior Jennie-O has a right to expect of its employees. The commissioner correctly determined that Smith was discharged for employment misconduct.
 Smith’s contention that he did not receive the live-haul policy until after he was discharged is contradicted by his own testimony as well as other evidence in the record.