Berglund v. Industrial Technology Institute

Citation
Berglund v. Industrial Technology Institute, No. 298227 (Mich. Ct. App. July 21, 2011).

Factual Background
Petitioner-Appellee Ronald G. Berglund (“Berglund”) was terminated from his employment with Respondent-Appellant Industrial Technology Institute (“ITI”). The Department of Energy, Labor & Economic Growth, Unemployment Insurance Agency subsequently determined that his conduct disqualified him from receiving benefits. While employed with ITT, Berglund was disciplined for using company equipment in connection with a second job, and the administrative panel received evidence that Berglund had accessed numerous websites on his work computer, during business hours, that displayed nudity or scantily-clad women. Based on that evidence, the administrative panel found Berglund guilty of misconduct, which lead to his disqualification.

State Circuit Court
The circuit court reversed this finding, ruling that there was insufficient proof to determine that the websites accessed by Berglund were “inappropriate,” or that Berglund had been informed not to visit such sites. Further, the court held that there was insufficient proof to support ITI’s assertion that Berglund had been instructed not to use company resources for outside activities.

State Appellate Court
Finding sufficient proof in the record on all counts, the appellate court reversed.

Under Michigan law, “an individual is disqualified from receiving benefits if he or she. . . [w]as suspended or discharged for misconduct connected with the individual’s work. . .” The Michigan Supreme Court has defined “misconduct” as

"conduct evincing such willful or wanton disregard of an employ’s interest as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect of his employee, or in carelessness or negligence of such degree or recurrence as to manifest equal culpability, wrongful intent or evil design, or to show an intentional and substantial disregard of the employer’s interests or the employee’s duties and obligations to his employer."

During the administrative proceedings, the hearing referee found that when Berglund was placed on probation he was directed not to use ITI’s resources or equipment to further his outside employment. Specifically, the HR Director instructed Berglund that he was “absolutely no to use our copiers, our printers, our computers to do his Central Michigan teaching.” Berglund further admitted that he printed a paper from his outside employment.

The hearing referee also found that Berglund visited websites displaying what were classified as “inappropriate” websites containing nudity and risqué images of teenage girls. Although Berglund did not express an opinion on whether these sites were indeed “inappropriate,” he admitted receiving and keeping emails that he deemed inappropriate and acknowledged that some of the emails he kept were pornographic. The referee determined that in an eight-hour day Berglund spent some 3-½ to 4 hours visiting these types of sites. Berglund’s primary argument in response to the assertions of ITT and the questions of the referee were that his personal use of the work computer was allowed at ITI and that his conduct did not affect his work performance.

A circuit court may review questions of fact and law on the record made before an administrative board, and may reverse an order or decision only if it finds that the order or decision is contrary to law or is not supported by competent, material, and substantial evidence on the whole record. The circuit court in the instant case made such a determination with respect to the evidence presented concerning whether the websites accessed were in fact “inappropriate,” and as to whether Berglund was given proper warning for personal use of company resources.

In reviewing a lower court’s review of agency action, an appellate court must determine whether the lower court applied correct legal principles and whether it misapplied the substantial evidence test to the agency’s factual findings. The appellate court determined that the circuit court had improperly reversed the decisions of the hearing referee as it found adequate evidence that the sites were inappropriate. Further, while the circuit court was unconvinced that Berglund had received proper warning regarding the access of such sites, the appellate court reasoned that the definition of “misconduct,” as defined by the Michigan Supreme Court, does not require a warning.