in the Court of Appeals 16 May 2018.
by respondent from orders entered 5 April 2017, 17 August
2017, and 28 August 2017 by Administrative Law Judge Melissa
Owens Lassiter in the Office of Administrative Hearings, No.
17 OSP 1269
Offices of Michael C. Byrne, by Michael C. Byrne, for
Attorney General Joshua H. Stein, by Assistant Attorney
General Tamika L. Henderson, for respondent-appellant.
case, a state agency refused to allow an employee to return
to work on the ground that he had resigned from his
employment. When the employee attempted to file a grievance
in which he denied that he had, in fact, resigned, the agency
refused to consider the grievance, and the employee filed a
petition for a contested case hearing in the North Carolina
Office of Administrative Hearings ("OAH"). An
administrative law judge ruled in favor of the employee and
ordered that he be reinstated to his former position. Because
we hold that no legally effective resignation occurred and
the agency lacked just cause to terminate his employment, we
and Procedural Background
November 2016, Jeffrey Hunt was a career status state
employee who worked for the North Carolina Department of
Public Safety ("DPS") as a correctional officer at
Scotland Correctional Institution. During the summer of 2016,
Hunt received two warnings about his tardiness and
November 2016, Hunt's unit manager, Queen Gerald, asked
him to report to the prison before his shift began the
following day. At 5:27 p.m. on 3 November 2016, Hunt entered
the facility and met with Gerald in an administration area
room. Gerald informed him that she was investigating his
alleged absence from work on 18 August 2016 and asked him to
sign paperwork regarding the absence. Hunt informed Gerald
that he would not sign documents regarding an absence for
which he had no recollection. He became upset and walked out
of the prison through the main door.
later testified that she heard Hunt say either "I
quit" or "I'm quitting" as he walked away.
Hunt denied making such a statement. An individual in the
vicinity recalled hearing Hunt state: "I'm tired of
left the prison without "swiping out, " and Gerald
informed the officer-in-charge that Hunt had resigned.
Several minutes later, Hunt tried to re-enter the prison to
begin working his shift but was denied entry by the
November 2016, Hunt attempted to contact Superintendent Katy
Poole by telephone to discuss his job status but learned that
she was on vacation. Poole returned to the office on 7
November 2016, and an assistant superintendent informed her
that Hunt had verbally resigned to Gerald.
November 2016, Poole spoke with Hunt by telephone. Hunt
inquired whether "he could return to work." Poole
asked him if he was rescinding his resignation to which Hunt
responded: "Yes." Poole informed him that she had
already accepted his verbal resignation and that she was
unwilling to rescind it based on "his history of pending
investigations and corrective actions" as well as his
behavior toward Gerald during the 3 November 2016 incident.
same day, Hunt received a letter from DPS confirming that he
had resigned on 3 November 2016. The letter did not contain
any information about his ability to appeal the separation of
his employment. On 21 November 2016, DPS received a letter
from Hunt in which he stated that "at no time during my
conversation with Mrs. Gerald (Unit Manager) on 11/3/2016 did
I give a resignation."
January 2017, Hunt submitted a Step 1 grievance letter to
DPS's Grievance Intake Office. DPS notified Hunt by
letter on 14 February 2017 that his internal grievance could
not be processed by the agency because he had resigned from
February 2017, Hunt filed a petition for a contested case
hearing in OAH. DPS moved to dismiss the petition on 24 March
2017 based on lack of subject matter jurisdiction. In its
motion, DPS asserted that Hunt had "failed to exhaust
the internal agency grievance process" and "failed
to file his grievance within fifteen (15) days of the event
pursuant to DPS policy."
April 2017, Administrative Law Judge Melissa Owens Lassiter
(the "ALJ") entered an order denying DPS's
motion to dismiss. A hearing was held before the ALJ on 15
August 2017, the ALJ issued a Final Decision pursuant to N.C.
Gen. Stat. § 150B-34 in which she determined that Hunt
had "never submitted a verbal statement of resignation
to any DPS employee authorized to accept it." The ALJ
concluded that DPS had, therefore, acted unlawfully by
terminating Hunt's employment without just cause. The ALJ
ordered that Hunt be reinstated to the same - or a similar -
position held by him prior to his separation and that he
receive back pay and attorneys' fees.
August 2017, Hunt filed a petition for attorneys' fees,
which the ALJ granted in an order entered 28 August 2017 (the
"Attorneys' Fees Order") awarding him $11,
720.00 in attorneys' fees and $20.00 in filing fees. DPS
filed a timely notice of appeal as to the 5 April 2017 order,
the Final Decision, and the Attorneys' Fees Order.
appeal, DPS contends that the ALJ erred by (1) denying its
motion to dismiss Hunt's contested case petition for lack
of jurisdiction; (2) concluding that the separation of Hunt
from his employment resulted from a discharge rather than a
voluntary resignation; and (3) awarding attorneys' fees
to Hunt. We address each argument in turn.
Subject Matter Jurisdiction of OAH
first argument is that the ALJ improperly denied DPS's
motion to dismiss because OAH did not possess subject matter
jurisdiction over Hunt's appeal. DPS contends that
jurisdiction was lacking because Hunt failed to properly
follow the mandatory grievance procedure required under North
Carolina law before filing a contested case petition in OAH.
Hunt, conversely, asserts that because DPS refused to
consider his grievance the agency made it impossible for him
to follow the grievance procedure.
standard of review of a motion to dismiss for lack of
[subject matter] jurisdiction . . . is de
novo." Brown v. N.C. Dep't of Pub.
Safety, __ N.C.App. __, __, 808 S.E.2d 322, 324 (2017)
(citation and quotation marks omitted), disc. review
denied, __ N.C. __, 811 S.E.2d 589 (2018). "Under
de novo review, the Court considers the matter anew
and freely substitutes its own judgment for that of the trial
court." Id. at__, 808 S.E.2d at 324 (citation
and quotation marks omitted).
order to assess DPS's arguments, it is necessary to
review the pertinent statutes that apply to these facts.
Prior to 2013, the statutory scheme governing personnel
actions against State employees was known as the State
Personnel Act. "In 2013, our General Assembly
significantly amended and streamlined the procedure governing
state employee grievances and contested case hearings,
applicable to cases commencing on or after 21 August
2013." Harris v. N.C. Dep't of Pub. Safety,
__ N.C.App. __, __, 798 S.E.2d 127, 131, aff'd per
curiam, __ N.C. __, 808 S.E.2d 142 (2017). The revised
set of statutes remains codified in Chapter 126 of the North
Carolina General Statutes but is now called "the North
Carolina Human Resources Act."
Gen. Stat. § 126-35(a) sets out the procedure by which a
career state employee may appeal disciplinary action taken
against him and states as follows:
(a) No career State employee subject to the North Carolina
Human Resources Act shall be discharged, suspended, or
demoted for disciplinary reasons, except for just cause.
In cases of such disciplinary action, the employee shall,
before the action is taken, be furnished with a statement in
writing setting forth the specific acts or omissions that are
the reasons for the disciplinary action and the
employee's appeal rights. The employee shall be permitted
15 days from the date the statement is delivered to appeal to
the head of the agency through the agency grievance procedure
for a final agency decision. However, an employee may be
suspended without warning for causes relating to personal
conduct detrimental to State service, pending the giving of
written reasons, in order to avoid undue disruption of work
or to protect the safety of persons or property or for other
serious reasons. If the employee is not satisfied with the
final agency decision or is unable, within a reasonable
period of time, to obtain a final agency decision, the
employee may appeal to the Office of Administrative Hearings.
Such appeal shall be filed not later than 30 days after
receipt of notice of the final agency decision. The State
Human Resources Commission may adopt, subject to the approval
of the Governor, rules that define just cause.
N.C. Gen. Stat. § 126-35(a) (2017) (emphasis added).
"In order for the OAH to have jurisdiction over [a]
petitioner's appeal pursuant to N.C. Gen. Stat. §[ ]
126-35 . . ., [the] petitioner is required to follow the
statutory requirements outlined in Chapter 126 for commencing
a contested case." Nailing v. UNC-CH, 117
N.C.App. 318, 324, 451 S.E.2d 351, 355 (1994) (citation
omitted), disc. review denied, 339 N.C. 614, 454
S.E.2d 255 (1995).
Gen. Stat. § 126-34.01 establishes a grievance procedure
that employees are generally required to follow in situations
involving a discharge, suspension, or demotion.
Any State employee having a grievance arising out of or due
to the employee's employment shall first discuss the
problem or grievance with the employee's supervisor,
unless the problem or grievance is with the supervisor. Then
the employee shall follow the grievance procedure approved by
the State Human Resources Commission. The proposed agency
final decision shall not be issued nor become final until
reviewed and approved by the Office of State Human Resources.
The agency grievance procedure and Office of State Human
Resources review shall be completed within 90 days from the
date the grievance is filed.
N.C. Gen. Stat. § 126-34.01 (2017).
a final agency decision is issued, a potential, current, or
former State employee may appeal an adverse employment action
as a contested case pursuant to the method provided in N.C.
Gen. Stat. § 126-34.02 . . . ." Harris, __
N.C.App. at __, 798 S.E.2d at 131. ...