Colorado Division of
Employment and Training and
Industrial
Claims Appeals Office, Petitioners, and
Longmont Bakery Company,
Inc., Employer,
v.
Sharon K. Hewlett, Respondent.
No. 88SC86.
777 P.2d 704
Supreme
Court of Colorado,
En Banc.
July 24, 1989.
Duane Woodard, Atty. Gen., Charles B. Howe, Chief Deputy Atty.
Gen., Richard H. Forman, Sol. Gen., Curt P. Kriksciun, Asst. Atty.
Gen., Denver, for petitioners.
William E. Benjamin, Boulder, for respondent.
MULLARKEY, Justice.
We granted certiorari to review Hewlett v. Colorado Division
of Employment and Training, 753 P.2d 791 (Colo.Ct.App.1987), in
which the court of appeals set aside the order of the Industrial
Claims Appeals Panel denying unemployment benefits to a claimant who
asserted that she left her job because of on-the-job harassment. We
conclude the court of appeals erred when it reversed the
administrative decision and directed that the test in Ward v.
Industrial Commission, 699 P.2d 960 (Colo.1985), be applied to
determine whether the claimant was entitled to receive unemployment
benefits. We reverse and remand the case to the court of appeals for
further proceedings consistent with this opinion.
I.
On August 24, 1986, Sharon Hewlett resigned her employment with
the Longmont Bakery and subsequently filed a claim for unemployment
benefits with the Colorado Division of Employment and Training
(division).1 The claim was denied by a deputy of
the division pursuant to section 8-73-108(5)(e)(XXII), 3B C.R.S.
(1986), on the basis that Hewlett had left her employment for
personal reasons.
Pursuant to section 8-74-103, 3B C.R.S. (1986), Hewlett appealed
the decision of the deputy and a hearing was held.2
The evidence indicates that both Hewlett and her husband were
employed by the Longmont Bakery; she worked in the production unit
and he was the sales supervisor. Hewlett had been employed for
approximately two years when she resigned on the day after her
husband was terminated from his position. Hewlett contended that she
resigned because of harassment by her supervisor and co-employees.
The harassment took the form of written and oral comments about
other female employees working with Hewlett's husband. These
comments, which suggested improper relationships between her husband
and the female employees, continued over the course of approximately
one year despite Hewlett's complaints to management. Hewlett
testified that she would have left her job earlier, but that she
tolerated the harassment because she believed that, if she resigned,
her husband's position would be threatened.
The referee found that even though Hewlett was subjected to
harassment not related to job performance, she tolerated the
harassment for over a year and would have acquiesced to the
harassment as long as her husband's employment continued. The
referee ruled that Hewlett's separation from employment was caused
by her husband's termination and not by the alleged harassment.
Thus, the referee concluded that Hewlett resigned for personal
reasons and was subject to the maximum reduction of benefits under
section 8-73-108(5)(e)(XXII).
Hewlett appealed to the Industrial Claims Appeals Panel (panel),
contending that she was entitled to a full award of benefits under
section 8-73-108(4), 3B C.R.S. (1986) because her resignation was
caused by personal harassment not related to job performance. The
panel affirmed the referee's decision. It reasoned that, although
Hewlett was harassed and did not acquiesce in the harassment, the
direct and proximate cause of Hewlett's separation was her husband's
termination from the bakery. Hence, the panel found that she
resigned for personal reasons and was disqualified from receiving
benefits.
Hewlett appealed the decision of the panel to the court of
appeals pursuant to section 8-74-107, 3B C.R.S. (1986), claiming
that the findings and conclusions of the panel were not supported by
the evidence. The court did not address the substantial evidence
issue but held that the referee and panel failed to apply the
appropriate standard in evaluating the evidence presented at the
hearing. The court stated:
The public policy of the state of
Colorado generally prohibits employment discrimination based
upon sex. See Sec. 24-34-402, C.R.S. (1982 Repl.Vol.
10). Federal policy contains similar prohibitions. See
42 U.S.C. Sec. 2000e-2; 29 C.F.R. 1604.11(a) (1987);
Meritor Savings Bank v. Vinson, 477 U.S. 57, 106 S.Ct.
2399, 91 L.Ed.2d 49 (1986). Moreover, the provisions of Sec.
8-73-108(4)(o), C.R.S. (1986 Repl.Vol. 3B) discloses a
public policy to assure that the work place is to remain
free of "personal harassment by the employer not related to
the performance of the job." While the improper conduct here
did not take the stereotypical form of sexual harassment, it
was based upon claimant's gender and marital status and,
thus, arguably contravened public policy.
Hewlett, 753 P.2d at 792. The court then rephrased the
issue as whether Hewlett's job separation resulted from the
employer's violation of public policy or her personal choice. Id.
The court of appeals concluded that "where such a 'dual motive'
issue is presented, the burden of proof between the parties must be
allocated, and the evidence must be considered, in the manner
described in Ward v. Industrial Commission, 699 P.2d 960
(Colo.1984)." Id.
II.
A.
Several general principles are relevant to our analysis of this
case. Foremost among these principles is our recognition that the
Colorado Employment Security Act, section 8-70-101 to 8-82-105, 3B
C.R.S. (1986), was designed to lighten the burden of unemployment on
those who are involuntarily unemployed through no fault of their
own. Under the law, unemployment benefits must be granted to an
employee unless the job separation was due to one or more
statutorily enumerated causes. Colorado Springs v. Industrial
Comm'n, 749 P.2d 412, 414 (Colo.1988); Salida School Dist.
R-32-J v. Morrison, 732 P.2d 1160 (Colo.1987). The Act is to be
liberally construed to further its remedial and beneficent purposes.
Harding v. Industrial Comm'n, 183 Colo. 52, 59, 515 P.2d 95,
98 (1973); Andersen v. Industrial Comm'n, 167 Colo. 281, 284,
447 P.2d 221, 223 (1968). We also emphasize that the unemployment
law is intended to provide a speedy determination of eligibility
through a simplified administrative procedure. See Salida School
Dist., 732 P.2d at 1165 (hearing designed to adjudicate promptly
narrow issue of law and to grant a limited remedy to unemployed
worker). Claimants and employers frequently appear pro se before
adjudicators who need not be attorneys. "The matter in controversy
is small and the legal issues are limited, and consequently, the
hearings are often informal." Id. at 1164.
Procedurally, the claimant has the initial burden of proof to
establish a prima facie case of eligibility for benefits. City &
County of Denver v. Industrial Comm'n, 756 P.2d 373, 380 (1988);
Duenas-Rodriguez v. Industrial Comm'n, 199 Colo. 95, 97, 606
P.2d 437, 438 (1980); Bartholomay v. Industrial Comm'n, 642
P.2d 50 (Colo.Ct.App.1982). If the initial burden of the claimant is
met, the burden shifts to the employer to establish the statutory
disqualification for benefits. City & County of Denver, 756
P.2d at 380; City of Arvada v. Industrial Comm'n, 701 P.2d
623, 624 (Colo.Ct.App.1985). A decision of the panel may not be set
aside where there are findings of fact supported by substantial
evidence. Gonzales v. Industrial Comm'n, 740 P.2d 999, 1001
(Colo.1987).
B.
With this background, we turn to the issue before us. Both
parties argue that Ward does not apply to this case. We
agree.
The Ward analysis applies when an unemployment claimant
contends that her separation from government employment resulted
from her assertion of a constitutionally protected right, e.g., her
first amendment right of free speech. In such a case, the three
factor test of Mt. Healthy City School District Board of
Education v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed.2d 471
(1977), is used to determine whether the claimant is entitled to
unemployment benefits. Ward, 699 P.2d at 964-65. The Mt.
Healthy test requires a plaintiff to prove by a preponderance of
the evidence that her conduct which led to her employment discharge
was constitutionally protected and that the conduct was a
"substantial" or "motivating" factor in the decision to terminate
her employment. If the plaintiff carries that burden of proof, the
employer must show that it would have reached the same decision in
the absence of the protected conduct. Mt. Healthy, 429 U.S.
at 287, 97 S.Ct. at 576. The Mt. Healthy test was followed in
Ward because the claimant was a state employee and the focus
of the case was "whether constitutionally protected activity has
been used by a state employer to justify a reduction of unemployment
benefits." Ward, 699 P.2d at 964-65.
In the case now before us, Ward is not relevant. Hewlett
was not a government employee, Longmont Bakery is not a government
employer and Hewlett does not contend that she was compelled to
leave her employment because she engaged in constitutionally
protected conduct.
The court of appeals found it necessary to apply the Mt.
Healthy test adopted in Ward because public policy
prohibits gender-based harassment in employment and because Hewlett
had mixed motives for her resignation. In our view, the court of
appeals erred when it extended the Ward analysis to this case
because the statute itself addresses the issues. An employee who
quits her job because of personal harassment is entitled to receive
unemployment benefits by the express terms of section 8-73-108(4),
which states:
An individual separated from a job shall
be given a full award of benefits if any of the following
reasons and pertinent conditions related thereto are
determined by the division to have existed. The
determination of whether or not separation from employment
shall result in a full award of benefits shall be the
responsibility of the division. The following reasons shall
be considered along with any other factors which may be
pertinent to such determination:
. . . .
(o) Quitting employment because of
personal harassment not related to the performance of the
job.
Gender-based harassment is encompassed within the more general
term "personal harassment" and a claimant who carries her burden of
proving that she quit her job because of personal harassment will
receive unemployment benefits.
A claimant is not disqualified for benefits under section
8-73-108(5)(e)(XXII) (quitting for personal reasons) if she is
otherwise eligible for benefits under one of the provisions of
section 8-73-108. Section 8-73-108(5)(e) states:
[I]f a separation from employment occurs
for any of the following reasons, the employer from whom
such separation occurred shall not be charged for benefits
which are attributable to such employment and, because any
payment of benefits which are attributable to such
employment out of the fund as defined in section
8-70-103(13) shall be deemed to have an adverse effect on
such employer's account in such fund, no payment of such
benefits shall be made from such fund:
. . . .
(XXII) Quitting under conditions
involving personal reasons which do not, under other
provisions of this section, provide for an award of
benefits.
Thus, an employee who proves that she quit her job because of
personal harassment is not disqualified under section 8-73-108(5)(e)(XXII)
because personal harassment is a statutory ground for the award of
benefits. Personal harassment need not be the sole factor in her
decision to quit because section 8-73-108(5)(e)(XXII) is a residuary
provision requiring disqualification only if no other provision
permits an award.
The Minnesota Court of Appeals reached the same conclusion in
Dura Supreme v. Kienholz, 381 N.W.2d 92 (Minn.App.1986), where
an unemployment claimant resigned her job after being sexually
harassed and the employer asserted that her resignation was
motivated by her dissatisfaction with the postponement of the
Christmas party and lack of cost-of-living increases. The court
awarded benefits to the claimant, stating that sexual harassment
attributable to the employer need not be the sole reason for
termination. Id. at 96. See also Curry v. Gatson, 376
S.E.2d 166, 169 (W.Va.1988) ("[I]f an employee is sexually or
racially harassed at the workplace and this discriminatory treatment
would cause a reasonably prudent person to resign, such employee is
not disqualified from receiving unemployment compensation benefits
upon resignation . . . .").
Because of its disposition of the case, the court of appeals did
not address the question of whether substantial evidence supported
the panel's decision. Accordingly, we reverse the court of appeals'
decision and remand the case to that court with directions to decide
that issue.
Footnotes
1. Section 8-73-102, 3B C.R.S. (1986)
provides a deputy designated by the director of the division will
review the claim of a party along with pertinent information
submitted by the employer and issue a decision. The decision will
set forth findings of fact, conclusions of law and an order.
2. Section 8-73-103 provides in relevant
part:
(1) Any interested party who is
dissatisfied with a deputy's decision may appeal that
decision and obtain a hearing covering any issue relevant to
the disputed claim. The issue of a claimant's availability
will be relevant to the extent set forth in section
8-73-107(1)(c)(I)(A).
. . . .
(3) The hearing officer, after affording
all interested parties a reasonable opportunity for a fair
hearing in conformity with the provisions of this article
and the regulations of the division, shall make a decision
on each relevant issue raised, including findings of fact,
conclusions of law, and an order.
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