This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (1996).




Caroline Pearson,



Damark International, Inc.,


Commissioner of Economic Security,


Filed March 24, 1998


Schumacher, Judge

Department of Economic Security

File No. 2399UC97

Roger S. Haydock, Timothy L. Gustin, Certified Student Attorney, William Mitchell Law Clinic, 875 Summit Avenue, St. Paul, MN 55105 (for relator)

James F. Hanneman, Howard B. Tarkow, Maslon Edelman Borman & Brand LLP, 3300 Norwest Center, 90 South Seventh Street, Minneapolis, MN 55402 (for respondent Damark)

Kent E. Todd, 390 North Robert Street, St. Paul, MN 55101 (for respondent Commissioner)

Considered and decided by Huspeni, Presiding Judge, Schumacher, Judge, and Mansur, Judge.*

*Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.



Relator Caroline Pearson appeals a decision of the Department of Economic Security disqualifying her from receiving reemployment benefits. Because the commissioner's representative's findings are supported by the record and establish that Pearson was discharged for misconduct, we affirm.


Pearson worked for 7-1/2 years for respondent Damark International, Inc., a mail order catalog business. Damark employees could purchase products at a discount and Pearson received a copy of the employee purchase policy.

Employees may not at any time enter orders into the computer system for themselves, their immediate/extended family, or other employees, nor may they alter their customer file in any way.

Pearson's son also worked at Damark, and he ordered a VCR through the employee purchase program. He was informed by Damark that a higher priced VCR would be substituted for the one he ordered and that he had the option of paying the price difference or cancelling his order. Damark's explanation for substituting employee orders is that either the item is not available because of a customer order, or Damark may have excess product that it wants to discard.

Pearson questioned several employees about the employee substitution process because she did not think it was fair that her son had to pay the difference for the higher priced item. Pearson's supervisor told Pearson that her son's only options were to pay the higher price or cancel the order. The supervisor also told Pearson not to touch her son's order.

As part of her customer service duties, Pearson was familiar with exception orders as a means to correct or change customer orders in response to customer inquiries. Pearson spoke with a fellow employee who offered to change Pearson's son's order back to the original VCR that appeared to be in stock. When the change in the order was discovered, Pearson was discharged for violating the company employee discount purchase policy and intentionally disregarding her supervisor's directive to leave her son's order alone.

Pearson was initially denied reemployment benefits, and she appealed. The hearing judge reversed the original denial, ruling that Damark did not establish misconduct. Damark appealed the hearing judge's determination and the commissioner's representative ruled that Damark did establish misconduct that disqualified Pearson from receiving reemployment benefits. Pearson appeals the decision of the commissioner's representative.


We review the factual findings of the commissioner's representative in the light most favorable to the decision and determine whether evidence in the record reasonably tends to sustain those findings. Lolling v. Midwest Patrol, 545 N.W.2d 372, 377 (Minn. 1996). The ultimate determination of whether an employee was properly disqualified from receiving benefits, however, is a question of law, and appellate courts exercise independent judgment when deciding that question. Id. Appellate review is limited to the findings of the commissioner's representative, even when those findings involve witness credibility. Id.

An employee is disqualified from receiving reemployment benefits if the employee "was discharged for misconduct." Minn. Stat. § 268.09, subd. 1(b) (1996). Misconduct

"is limited to conduct evincing such wilful or wanton disregard of an employer's interests as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect * * *."

Tilseth v. Midwest Lumber Co., 295 Minn. 372, 374-75, 204 N.W.2d 644, 646 (1973) (adopting and quoting definition from Boynton Cab Co. v. Neubeck, 296 N.W. 636, 640 (1941)).

Pearson argues that the commissioner's representative's findings are not supported by the record. The commissioner's representative found that Pearson violated the policy of Damark on employee purchases. Pearson disapproved of Damark substituting a more expensive VCR for the one that her son, also a Damark employee, ordered and charging him the difference; especially when it appeared that the original VCR he ordered was in stock. Viewing the evidence in favor of the commissioner's decision, the record establishes that Pearson knew she was not to alter employee orders for herself or her family, she was told by her supervisor not to do it but nevertheless had another employee enter an exception order to alter her son's order. While Pearson would characterize her conduct as simply inquiring, the record supports the commissioner's finding that Pearson violated the policy by having her son's order changed.

Pearson also argues that her actions did not establish misconduct. When determining if a set of facts establishes misconduct, appellate courts consider

(1) whether an employee deliberately violated standards of behavior which the employer has a right to expect of its employee, (2) whether an employee's conduct adversely affected the business or other employee's morale and (3) whether an employee ignored past warnings.

* * * *

A single incident where an employee deliberately chooses a course of action adverse to the employer can constitute misconduct.

Ress v. Abbott Northwestern Hosp., 448 N.W.2d 519, 524 (Minn. 1989).

Here, the record establishes that Pearson deliberately chose a course of action adverse to Damark in spite of her supervisor's explicit order to the contrary. Pearson's actions constituted misconduct. See id. at 525 (initiating unauthorized treatment and disregarding orders from supervising doctor demonstrate misconduct); Cf. Auger v. Gillette Co., 303 N.W.2d 255, 257 (Minn.1981) (employee morale can be negatively affected when conduct could lead other employees to decide they need not comply with work rules); McDonald v. PDQ, 341 N.W.2d 892, 893 (Minn. App. 1984) (employer has right to expect "scrupulous adherence" to procedures for handling employer's money).

Pearson also argues that the commissioner's representative failed to consider the length of her employment. Length of employment is relevant when an employee's conduct is not adverse to the employer. See Sticha v. McDonald's, 346 N.W.2d 138, 140 (Minn. 1984) (conduct evinced good-faith error, was isolated instance during 10 years of employment and did not adversely affect employer).