Retama Development Corporation and Retama Park Management Company, L.C. v. Texas Workforce Commission and Jimmy W. Brown

Citation: Not availableDocket: 03-97-00790-CV

Court: Court of Appeals of Texas; June 4, 1998; Texas; State Appellate Court

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Retama Development Corporation and Retama Park Management Company, L.C. (collectively "Retama Park") appeal a summary judgment favoring the Texas Workforce Commission (TWC) and Jimmy W. Brown. Retama Park contests the TWC's decision to charge its employer account for unemployment benefits awarded to Mr. Brown after his layoff, asserting that his termination should not affect their account under section 204.022(a)(2) of the Texas Unemployment Compensation Act (TUCA), which protects employer accounts when an employee's separation is mandated by statute or ordinance. 

The case background reveals that Retama Park operated a licensed racetrack and was required to conduct live races on specific dates set by the Racing Commission. However, on November 21, 1995, Retama Park requested to cancel its remaining race dates, which the Commission approved. Subsequently, Mr. Brown was laid off the next day and filed for unemployment benefits, which the TWC granted, ruling that Retama Park's account would be charged. Retama Park argued that Mr. Brown's layoff was "required by statute" under TUCA, but the appeal tribunal and TWC upheld the charge against Retama Park’s account. 

Retama Park sought judicial review, and both parties moved for summary judgment, with the district court granting the TWC's motion and denying Retama Park's. The appellate court's review focuses on whether there is a genuine material fact dispute and the legal question of whether Brown's discharge was required by statute as per TUCA section 204.022(a)(2). The court determined that it would affirm the district court's decision, agreeing with the TWC and the lower court that Mr. Brown's termination was not mandated by any statute.

Appellants contend that summary judgment should have been granted in their favor based on TUCA section 204.022(a)(2), which protects employer accounts from charge-backs if an employee's termination is mandated by state statute or municipal ordinance. They argue Mr. Brown's termination was required by statute following the Racing Commission's decision to end the racing season early. Retama Park counters that the highly regulated nature of horse racing means actions taken under statutory authority qualify for charge-back protection. However, the court rejects this assertion, clarifying that charge-back protection applies only when an employee's termination is explicitly required by a statute or ordinance, not merely when actions are taken under statutory authority. The Texas Workforce Commission (TWC) has determined that terminations must occur as a result of a statutorily mandated act to qualify for protection, distinguishing mandatory actions from discretionary ones. The court finds TUCA section 204.022(a)(2) unambiguous, stating that no statute or ordinance mandated Mr. Brown's termination. Therefore, Retama Park's account does not qualify for charge-back protection. Although appellants argue that the Racing Commission's approval of early termination should be regarded as a legislative act, the court holds that such an order does not constitute a promulgated rule. The appeal tribunal's findings confirm that Retama Park’s request to cancel the racing season was due to economic conditions, with appellants acknowledging the undisputed material facts. Consequently, the TWC's ruling is upheld, and the district court’s summary judgment in favor of the TWC is affirmed.

Retama Park's termination of an employee during an economic downturn does not exempt it from unemployment benefit charge-backs, as established by section 204.022(a)(2), which applies when termination is mandated by statute. The argument that Retama Park's circumstances are distinct due to the highly regulated nature of horse racing is rejected, as the statute's language does not support this interpretation. The Texas Workforce Commission (TWC) did not act arbitrarily by not applying a previous decision (Appeal No. 93-004252-10M-012194) related to layoffs at the end of a racing season, as Retama Park's early season termination was factually different. The TWC's decision is upheld because no statute required the discharge of the employee in question, Jimmy Brown. The court affirmed the TWC's judgment and the district court's ruling, rejecting the appellants' claims regarding the agency's adherence to its own precedents. Ultimately, the ruling clarifies that protection from charge-backs under section 204.022(a)(2) is contingent upon statutory requirements for termination, which Retama Park did not meet.