ARKANSAS COURT OF APPEALS

NOT DESIGNATED FOR PUBLICATION

JOHN E. JENNINGS, JUDGE

DIVISION IV

E 00-44

May 16, 2001

RONNIE COUCH APPEAL FROM THE ARKANSAS

APPELLANT BOARD OF REVIEW

VS.

DIRECTOR, EMPLOYMENT

SECURITY DEPARTMENT

AND ALBEMARLE CORPORATION

APPELLEES AFFIRMED

Ronnie Couch was denied unemployment benefits under Arkansas Code Annotated section 11-10-514(b) (Supp. 1999) following his termination from employment with appellee, Albemarle Corporation. The Board of Review upheld the decision of the Appeal Tribunal that found appellant had been terminated from his last employment for misconduct involving dishonesty. Appellant argues that the Board's decision is not supported by substantial evidence. We disagree and affirm.

"Misconduct," for purposes of unemployment compensation, involves: (1) disregard of the employer's interest; (2) violation of the employer's rules; (3) disregard of the standards of behavior which the employer has the right to expect; and (4) disregard of the employee's duties and obligations to her employer. Washington Reg'l Med. Ctr. v. Director, 64 Ark. App. 41, 979 S.W.2d 94 (1998). The issue of misconduct is a question of fact for the Board of Review to determine. On appeal, the Board's findings of fact are conclusive if they are supported by substantial evidence. Rucker v. Director, 52 Ark. App. 126, 915 S.W.2d 315 (1996). We review the evidence and all reasonable inferences deducible therefrom in the light most favorable to the Board's findings. Clark v. Director, 58 Ark. App. 1, 944 S.W.2d 862 (1997). Our review is limited to a determination of whether the Board could reasonably reach its decision upon the evidence before it. Id.

Albemarle Corporation produces and packages flame-retardant powders. Appellant, as a packager, was to take a sample of powder from certain pallets at specific intervals so that the powder could be tested at the plant's laboratory. An inter-office memorandum cited the reason for appellant's termination as the falsification of company records involving the sample from pallet 11 taken on January 10, 1999. There was testimony from Celia McQuiston, appellee's human resources representative, that appellee's employeehandbook clearly provided that falsification of company records is a type of misconduct that can result in disciplinary action including termination.

Michael Thomas, a laboratory technician for appellee, testified that it was determined that appellee would run samples from pallets 1, 6, 11, and 16 and that an extensive three-hour analysis was done on the sample from pallet 11 whereas only a partial analysis was done on the others. Thomas testified that an analysis was needed to determine whether the product met the exact specifications for each customer and that it was crucial that appellee be able to retrace the sample to the exact pallet from which it came in order to find out where the product went bad and still ship the product that was good.

Thomas stated that on January 10, 1999, he was involved with a packager, Travis Page, that appellant was to relieve and that it was customary for the next packager to make relief an hour before the lab technicians make relief. He explained that his shift was from 5:00 a.m. to 5:00 p.m. while appellant's shift was from 4:00 a.m. to 4:00 p.m.. Thomas stated that he asked Page whether there was any way that he could get to pallet 11 before his shift was over, and he said that Page stated that he was going to leave off somewhere around pallet 9 and to go ahead and clean up the lab because he was not going to finish pallet 11. He testified that,as he was cleaning up the lab to ready it for the next shift, appellant came in just before 4:00 p.m. and handed him what was represented to be a sample from pallet 11. Thomas recalled that appellant was dressed in street clothes, instead of his protective paper suit, and that he had no respirator ring on his face. He testified that he specifically asked appellant whether the sample had come from pallet 11 and that appellant replied that it had. He said that he asked appellant how that could be and that appellant became confrontational and told him not to worry about it. Thomas testified that, because "his neck was on the line," he followed appellant to the packaging area where he observed a stack of empty pallets with pallet 11 on top, and he saw one bag of powder on pallet 10. Thomas explained that thirty-nine more bags would have had to be placed on pallet 10 before getting to pallet 11. Thomas stated that appellant became angry and told him not to tell him how to do his job and that it was all the same powder and all the same pallets and that it did not make any difference. He explained that it did, in fact, make a difference because the powder came from different batches and that there will be a specific point in time in packaging when one batch is good and another batch is bad. Thomas then said that appellant explained to him that he did not want to have to package only one pallet before having to stop to bring the sample to the lab and then go back to packaging. Thomastestified that he took appellant's statement as an admission that he intentionally pulled the sample sooner than he should have so that he could "make a longer run" without interruption. He stated that he immediately reported the incident to his supervisor and that the next day he spoke with Page who stated that he left off with pallet 9 and that he did not start on pallet 10. Thomas was later recalled to the stand, and he testified that he did not see any numbers written on index cards on the pallets.

Alton Wilson, the Unit Leader at appellee corporation, testified that, while investigating another matter in May of 1999 concerning insubordination involving appellant, he learned of the January 1999 incident. Looking at company records, Wilson stated that pallet 9 was completed by Page at 3:05 p.m.; pallet 10 was completed by appellant at 4:00 p.m.; and pallet 11 was completed by appellant at 4:20 p.m.. Wilson said that a joint decision was made to terminate appellant.

Appellant testified that he had worked for appellee for two years and that he had done the same job at the plant for an independent contractor before that. He stated that, when he arrived at work on January 10, pallet 10 had already been thrown and wrapped and he began throwing pallet 11. He testified that he pulled a sample out of the very first bag on pallet 11 and carried it to the lab. He explained that he was not wearing his protectivesuit when he handed the sample to Thomas in the lab because he had been told not to because doing so could contaminate the computers. He further explained that he did not yet have a respirator ring on his face nor was he sweaty because it was early on in his shift. Appellant stated that, when Thomas came to the packaging area where he was working, pallet 10 was on the wrapping machine waiting to be wrapped and that pallet 11 was on the weight scale. He testified that it takes fifteen to twenty minutes to load a pallet and that it is weighed before it is wrapped. Appellant stated that the accurate pallet numbers were on index cards stapled to the side of the pallets and that he did not know whether Thomas was looking at those index cards. He stated that if there were a number written in "magic marker" it would not necessarily match the number on the index card. Appellant did not recall telling Thomas that the powder was all the same but that he did tell him he needed to get out of the packaging area because he did not have on protective clothing. He testified that, when he explained the incident to his supervisor, Richard Erwin, the next day, Erwin seemed satisfied and told him to stay clear of Thomas. Appellant stated that he had never been told that he was required to have one pallet weighed and wrapped before starting another.

In his testimony Richard Erwin, shift team leader for appellee, confirmed that the pallets were marked with black markerpencil in January 1999 and that index cards were no longer being used. Erwin testified that he never told appellant to take off his protective paper clothing before entering the lab and that, in fact, there was no need to enter the lab at all because there are plastic trays for placing samples outside the lab door. Erwin stated that appellant told him about the incident on the day it happened by saying that Thomas had been snooping around in the packaging area and had gotten upset because he and Page had brought samples to the lab back-to-back. Erwin admitted that he did no investigation of the matter.

Appellant's statement to the Arkansas Employment Security Department made on May 20, 1999, was introduced into evidence. In it appellant stated that he started his shift on January 10 with pallet 10 and that, after hand-stacking the bags on pallet 10, he sat that pallet on the check scale and began pallet 11 by pulling a sample from it. Appellant stated that he logged in the sample, finished stacking pallet 11, wrapped pallet 10 and carried it to the warehouse, and then wrapped pallet 11 and carried it to the warehouse.

The Board of Review agreed with the Appeal Tribunal that a preponderance of the evidence showed that appellant did not take a proper sample from pallet 11 but indicated that he did, thereby falsifying the sample. The Board also noted that the Tribunal'sdecision soundly reflected the inconsistency in appellant's statements to the Department and the Tribunal about the critical sequence of events on January 10 which greatly weakened his credibility as it conflicted with firsthand testimony from the employer's witnesses. The Board affirmed the Tribunal's denial of unemployment benefits based on appellant's misconduct involving dishonesty.

Appellant makes numerous factual arguments on appeal to this court. He first argues that Thomas was merely upset that he brought the sample from pallet 11 when Thomas was getting ready to call it a day. He points out that Thomas's testimony is based on hearsay statements of Travis Page whom appellee did not call upon to testify against him. Appellant denies that he essentially admitted to Thomas that the sample came from pallet 10, instead of pallet 11, and that he said he did not want to interrupt his packaging. He points out that Thomas had never worked in the packaging area and had no firsthand knowledge of packaging procedures. Appellant argues that appellee is wrongly assuming that a sample cannot be taken from one pallet before another is weighed, wrapped, and taken to storage. He also points out that his supervisor, Erwin, apparently did not think the matter was significant because nothing more was said until May 1999. He also points out that there were no discrepancies in the testingdone on the samples during his watch. Finally, appellant points out that appellee corporation, which has exclusive possession of the documentation, failed to produce pertinent records, including those that would have shown precisely when he arrived at work on the day in question.

The credibility of witnesses and the weight to be accorded their testimony are matters to be resolved by the Board of Review. Grigsby v. Everett, 8 Ark. App. 188, 649 S.W.2d 404 (1983). We recognize hearsay to be admissible in hearings before administra tive tribunals, but we have previously held that hearsay alone is not substantial evidence. Richards v. Daniels, 1 Ark. App. 331, 615 S.W.2d 399 (1981).

We agree with the Board that appellant's statement in May 1999 weakened his credibility as it directly contradicted his testimony before the Tribunal. Whereas in his statement to the Department appellant said that he had hand-stacked pallet 10 upon his arrival at work and then took a sample from the first bag of pallet 11, his testimony before the Tribunal was that Page had already stacked pallet 10 but had not yet weighed and wrapped it and that he immediately started on pallet 11 by pulling the sample before returning to finish pallet 10. Thomas testified that when he went to the packaging area he saw pallet 11 on a stack of empty pallets and that only one bag of powder was sitting on pallet 10. Thomasalso indicated that Page confirmed that he had left off after pallet 9 and did not start on pallet 10. Given the discrepancy in appellant's accounts of the events on January 10 and given Thomas's testimony of his observations on that day, there is substantial evidence even without the hearsay statements from Page to support the Board's finding that appellant was discharged for misconduct involving dishonesty.

Affirmed.

Robbins and Baker, JJ., agree.