WI Dept. of Agriculture, Trade, and Consumer Protection v. Wisconsin Employment Relations Commission

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
May 6, 2021
A party may file with the Supreme Court a
Sheila T. Reiff petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10 and
RULE 809.62.

Appeal No. 2020AP406 Cir. Ct. Nos. 2019CV863
2019CV871
STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT IV

WI DEPT. OF AGRICULTURE, TRADE, AND CONSUMER PROTECTION
AND WISCONSIN DEPARTMENT OF ADMINISTRATION,

PETITIONERS-RESPONDENTS-CROSS-RESPONDENTS,

CLAIRE R. FRIED,

PETITIONER-APPELLANT-CROSS-RESPONDENT,

V.

WISCONSIN EMPLOYMENT RELATIONS COMMISSION,

RESPONDENT-RESPONDENT-CROSS-APPELLANT.

------------------------------------------------------------

CLAIRE R. FRIED,

PETITIONER-APPELLANT-CROSS-RESPONDENT,

V.
No. 2020AP406

WISCONSIN EMPLOYMENT RELATIONS COMMISSION,

RESPONDENT-RESPONDENT-CROSS-APPELLANT.

APPEAL and CROSS-APPEAL from an order of the circuit court for
Dane County: RHONDA L. LANFORD, Judge. Affirmed.

Before Fitzpatrick, P.J., Blanchard, and Nashold, JJ.

Per curiam opinions may not be cited in any court of this state as precedent

or authority, except for the limited purposes specified in WIS. STAT. RULE 809.23(3).

¶1 PER CURIAM. Claire Fried appeals a circuit court order reversing
a Wisconsin Employment Relations Commission decision concluding that Fried had
displacement rights under WIS. ADMIN. CODE § ER-MRS 22.08(3) (Dec. 2015).
The issue we address is whether WIS. STAT. § 230.34(2)(b) (2013-14)1 as amended
by 2015 Wis. Act 150 eliminated the displacement rights and invalidated § ER-MRS
22.08(3) (Dec. 2015). We conclude that the amended statute eliminated the
displacement rights and invalidated § ER-MRS 22.08(3). Accordingly, we affirm
the circuit court.2

1
All references to the Wisconsin Statutes are to the 2013-14 version unless otherwise
noted.
2
The Commission cross-appeals. The Commission argues that, if we reverse the circuit
court, then we should resolve the issues raised in its cross-appeal that the circuit court found to be
moot. Because we affirm the circuit court, we do not address those issues.

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Background

¶2 Fried was employed by the Department of Agriculture, Trade, and
Consumer Protection. In November 2017, the Department laid off Fried without
providing her with the displacement rights set forth in WIS. ADMIN. CODE § ER-
MRS 22.08(3). Fried filed a grievance, which was denied by the Department of
Administration based on its determination that 2015 Wis. Act 150 eliminated
displacement rights.

¶3 Fried sought further administrative review and obtained a decision in
her favor from the Commission. The Commission concluded that Fried was entitled
to displacement rights as set forth in WIS. ADMIN. CODE § ER-MRS 22.08(3) and
that 2015 Wis. Act 150 did not supersede § ER-MRS 22.08(3).

¶4 The Department of Agriculture, Trade, and Consumer Protection and
the Department of Administration petitioned the circuit court for review of the
Commission’s decision. The circuit court reversed the Commission, concluding
that WIS. STAT. § 230.34(2)(b) as amended by 2015 Wis. Act 150 eliminated
displacement rights and invalidated WIS. ADMIN. CODE § ER-MRS 22.08(3).

Discussion

¶5 We review the Commission’s decision, not the circuit court’s
decision. See Honthaners Rests., Inc. v. LIRC, 2000 WI App 273, ¶8, 240 Wis. 2d
234, 621 N.W.2d 660. As noted, the issue is whether WIS. STAT. § 230.34(2)(b) as
amended by 2015 Wis. Act 150 eliminated Fried’s displacement rights and
invalidated WIS. ADMIN. CODE § ER-MRS 22.08(3). This issue presents a question
of statutory interpretation, and we review the Commission’s interpretation of a
statute de novo. See WIS. STAT. § 227.57(11) (2019-20) (“Upon review of an

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agency action or decision, the court shall accord no deference to the agency’s
interpretation of law.”); see also Tetra Tech EC, Inc. v. DOR, 2018 WI 75, ¶84,
382 Wis. 2d 496, 914 N.W.2d 21.

¶6 For the reasons explained below, we agree with the Department of
Agriculture, Trade, and Consumer Protection and the Department of Administration
that the amended statute eliminated Fried’s displacement rights and invalidated WIS.
ADMIN. CODE § ER-MRS 22.08(3), and we reject Fried’s and the Commission’s
interpretation of the statute to the contrary.

¶7 “[S]tatutory interpretation ‘begins with the language of the statute. If
the meaning of the statute is plain, we ordinarily stop the inquiry.’” State ex rel.
Kalal v. Circuit Court for Dane Cnty., 2004 WI 58, ¶45, 271 Wis. 2d 633, 681
N.W.2d 110 (quoted source omitted). “[S]tatutory language is interpreted in the
context in which it is used; not in isolation but as part of a whole; in relation to the
language of surrounding or closely-related statutes; and reasonably, to avoid absurd
or unreasonable results.” Id., ¶46.

¶8 Importantly for purposes here, “‘[a] review of statutory history is part
of a plain meaning analysis’ because it is part of the context in which we interpret
statutory terms.” County of Dane v. LIRC, 2009 WI 9, ¶27, 315 Wis. 2d 293, 759
N.W.2d 571 (quoted source omitted). “The materials reviewed when considering
statutory history consist of ‘the previously enacted and repealed provisions of a
statute.’” Id. (quoted source omitted).

¶9 Prior to 2015 Wis. Act 150, the statute at issue here provided agency
authority to promulgate rules governing displacement rights:

The director shall promulgate rules governing layoffs and
appeals therefrom and alternative procedures in lieu of layoff

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No. 2020AP406

to include voluntary and involuntary demotion and the
exercise of a displacing right to a comparable or lower
class, as well as the subsequent employee right of restoration
or eligibility for reinstatement.

WIS. STAT. § 230.34(2)(b), as amended by 2015 Wis. Act 55, § 3772 (emphasis
added).

¶10 By the time of Fried’s layoff, however, the statute had been amended
by 2015 Wis. Act 150 to eliminate agency authority to promulgate rules governing
displacement rights. It reads:

The director shall promulgate rules governing layoffs and
appeals therefrom and alternative procedures in lieu of layoff
to include voluntary and involuntary demotion, as well as the
subsequent employee eligibility for reinstatement.

WIS. STAT. § 230.34(2)(b) (2015-16).

¶11 Thus, a comparison of the statutory language before and after 2015
Wis. Act 150 reads as follows:

The director shall promulgate rules governing layoffs and
appeals therefrom and alternative procedures in lieu of layoff
to include voluntary and involuntary demotion and the
exercise of a displacing right to a comparable or lower class,
as well as the subsequent employee right of restoration or
eligibility for reinstatement.

¶12 We agree with the Department of Agriculture, Trade, and Consumer
Protection and the Department of Administration that this change to the statutory
language clearly and unambiguously shows that the legislature eliminated
displacement rights, and that the amended statute therefore invalidated the
displacement rights set forth in WIS. ADMIN. CODE § ER-MRS 22.08(3). We
disagree with Fried and the Commission that the amended statute left § ER-MRS
22.08(3) in place as a pre-existing rule and affected only agency authority to

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promulgate new rules going forward. Once the legislature eliminated agency
authority to promulgate rules governing displacement rights, § ER-MRS 22.08(3)
was no longer valid because the rule exceeded the agency’s authority and conflicted
with the amended statute. As our supreme court has explained:

Although the [agency] has authority to promulgate a rule, the
“rule is not valid if it exceeds the bounds of correct
interpretation.” Wis. Stat. § 227.11(2)(a); see Seider, 236
Wis. 2d 211, ¶71. “A rule exceeds an agency’s statutory
authority if it conflicts with an unambiguous statute” by
contradicting either the language of a statute or legislative
intent. [Seider, 236 Wis. 2d 211], ¶72. In cases in which a
conflict arises between a statute and an administrative rule,
the statute prevails.

State ex rel. Castaneda v. Welch, 2007 WI 103, ¶43, 303 Wis. 2d 570, 735 N.W.2d
131; see also Milwaukee Transp. Servs., Inc. v. DWD, 2001 WI App 40, ¶9, 241
Wis. 2d 336, 624 N.W.2d 895 (“If a regulation conflicts with a statute, the statute
governs.”).

¶13 Fried contends that the phrase “to include” in the amended statute
should be read expansively, as permitting the promulgation of rules on matters not
expressly listed in the statute, including displacement rights. We disagree that “to
include” can be read so expansively as to include displacement rights. Regardless
of how “to include” might ordinarily be interpreted, and regardless of whether it
might be interpreted here to permit rules on matters not expressly listed, it would be
absurd and unreasonable to read the amended statute to allow for precisely what the
legislature expressly eliminated.

¶14 Fried next argues that it is absurd and unreasonable to interpret the
amended statute to invalidate pre-existing rules governing layoffs when
replacement rules were not promulgated until two years after the statute was
amended. Fried argues that this would mean that “for 2 years Agency HR personnel

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had no guidance on layoff procedures and could simply create their own rules on an
ad hoc basis.” This argument is not persuasive. We do not interpret the amended
statute to invalidate all pre-existing layoff rules. Rather, like the circuit court, we
more narrowly conclude that the amended statute invalidated the displacement
rights provisions in WIS. ADMIN. CODE § ER-MRS 22.08(3).3

¶15 Finally, Fried argues that, if the legislature had intended for 2015 Wis.
Act 150 to immediately invalidate WIS. ADMIN. CODE § ER-MRS 22.08(3), the
legislature could have expressly repealed § ER-MRS 22.08(3). Fried also argues
that, if the agency bureau director believed that the legislature intended for 2015
Wis. Act 150 to modify displacement rights under § ER-MRS 22.08(3), the director
could have promulgated an emergency rule. However, there was no need for an
express legislative repeal or an emergency rule because, as discussed above, when
a statute and an administrative rule conflict, the statute prevails.

¶16 In sum, for the reasons stated above, we affirm the circuit court.

By the Court.—Order affirmed.

This opinion will not be published. See WIS. STAT. RULE
809.23(1)(b)5. (2019-20).

3
The current version of WIS. ADMIN. CODE § ER-MRS 22.08 no longer includes the
subsection (3) replacement rights. See § ER-MRS 22.08 (July 2018).

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