Court of Appeal: Employee's Attempt to Buy Shoes for Friend with Employer's Money Not Misconduct

Here's another Court of Appeal decision regarding an unemployment insurance benefits determination by the Employment Development Department.  A few weeks ago, the Court decided that refusing to sign a document was insubordination, disqualifying an employee from benefits.  See here.  Not this time.

In this case, Robles was employed by Liquid Environmental Solutions. He received an annual allowance for safety shoes.  He took a friend to the Red Wing store to buy the friend a pair of boots with his shoe allowance.  The store clerk would not permit the purchase.  Robles did not complete the transaction.  He was later suspended and then fired.

Robles applied for unemployment benefits.  The company did not appear or contest.  Robles admitted he attempted to use the Company's shoe allowance to buy shoes for a non-employee friend.  EDD denied the claim for unemployment on the basis of misconduct, as did the superior court.  Here is what the EDD's ALJ said, which pretty much sums it up:

Robles started to explain his objection to the characterization in the investigator・s report to the effect that claimant stated he was aware ―that the purchase had to be for employees only.‖The ALJ said he would have a chance later to ―tell me more about it.

The ALJ found that Robles was discharged for misconduct connected with work. In particular, Robles understood that the employer intended that its employees use the
annual shoe allowance to purchase shoes. Robles breached ―a duty of good faith and fair dealing when he attempted to obtain shoes for a friend who was not an employee rather than using the allowance for himself. [¶] The claimant may have had good intentions toward his friend, but in his actions he breached a serious obligation he had to the employer.

But the court of appeal disagreed with the EDD and superior court.  The court of appeal apparently did not accept that an employee who knowingly attempts to use company money to buy something for a third party is stealing, or at least attempting to do so:

In the case at hand, Robles knew that the employer intended its employees to use the shoe allowance to purchase safety shoes for work, but the element of culpable intent has not been established. First, Robles did not try to hide anything when he went to the shoe store. Next, it is undisputed that he wanted to help his friend who had a recent home accident. Further, Robles had decent safety shoes and did not feel he would jeopardize the safety purpose of the allowance or otherwise injure his employer‘s interests. When his supervisor indicated the employer did not approve of the intended use, Robles registered his regret and assured the supervisor he would comply. And finally, Robles did not use the shoe allowance for his friend. At most Robles was guilty of a good faith error in judgment. At the least Robles misunderstood the limits of what he could do with the safety shoe allowance, which he was entitled to as a benefit of employment.

Well, you be the judge.  Is the court of appeal indulging bad behavior.  Do you need a written policy saying don't use company money to buy friends shoes intended for employee safety?  Is this misconduct or just a "good faith error in judgment?"  These are rhetorical questions; don't write :)

The case is Robles v. EDD and the decision is here.