IN THE COURT OF APPEALS OF IOWA
No. 2-249 / 01-1289
Filed October 30, 2002
ROBERT N. ANDERSON, Jr.,
            Petitioner-Appellee.
vs.
WINNEBAGO INDUSTRIES, INC., Employer, and
EMPLOYMENT APPEAL BOARD,
            Respondents-Appellants.
            Appeal from the Iowa District Court for 
Winnebago County, John S. Mackey, Judge.
            The respondents appeal from the district 
court’s ruling on judicial review reversing an agency 
decision denying the petitioner unemployment benefREVERSED 
its.  AND REMANDED.
            Lee P. Hook and Joseph M. Barron of PeSpencer 
ddicord, Wharton, & Hook, P.C., Des Moines, for appellant 
Winnebago Industries, Inc.
            Richard R. Ramsey, Des Moines, for appellant 
Employment Appeal Board.
            N. Leroy Walters of Walters Law Office
, Mason City, and Mindi M. Vervaecke of Fitzsimmons 
& Vervaecke, Mason City, for appellee.
            Heard by Huitink, P.J., and Zimmer and
 Miller, JJ.
ZIMMER, J.
            Winnebago Industries, Inc. (Winnebago)
 and the Employment Appeal Board (Board) appeal from 
a district court’s ruling on judicial review reversing 
an agency decision denying unemployment benefits to 
former Winnebago employee Robert Anderson, Jr.  Winnebago 
and the Board contend the district court erred in reversing 
the finding of misconduct by the Board.  We agree,
 and thus we reverse the district court and affirm
 the agency decision.
I.            BACKGROUND FACTS AND PROCEEDINGS.
            Anderson commenced his employment with
 Winnebago on April 26, 1993.  He was discharged from 
his employment on January 22, 1998 for insubordination 
occurring the prior day.  Anderson was a product a
ssembler/fabricator.  
            The policy of Winnebago concerning complaints 
was that an employee should first raise his or her
 concerns with his or her immediate supervisor, and 
then with the area manager.  From there, the employee 
should address his or her concerns with the respective 
director, then the vice president of the employee’s 
area, and finally with the personnel department.  Anderson 
had previously failed to follow this chain of command 
and had been reprimanded and even suspended from work 
for insubordination.  He received a warning in 1997 
that unless immediate improvement was shown in the
 area of insubordination, he would be terminated i
mmediately.
            On January 21, 1998, Winnebago announced 
a two-hour delay for its employees due to severe wEmployees 
eather.  were told to report at 9:00 a.m.  When Anderson 
arrived for work at about 8:45, there were other employees 
already working.  He had previously been told no one 
was allowed to work during snow delays.  Anderson believed 
he and others were denied thirty-five dollars in pay 
by not being able to work during the snow delay.  

            Anderson brought up the issue of whether 
employees could work during snow delays with his immediate 
supervisor.  The supervisor agreed to have a meeting 
to clarify this issue the following day.  Without waiting 
for the meeting, and without consulting his area mAnderson 
anager, first attempted to contact the personnel director 
and then twice attempted to contact the CEO of Winnebago 
regarding the snow delay issue.  For his insubordiAnderson 
nation, was terminated.
            Anderson’s application for unemployment 
benefits was denied at the administrative level.  He 
appealed, and the matter was remanded back to the agency 
for another hearing.  Following the remand hearing
, the administrative law judge denied Anderson unemployment 
benefits.  On appeal, the Board affirmed.  It determined 
that Anderson’s last act on January 21, 1998 was unreasonable 
and constituted a continual, blatant disregard of s 
Winnebago’interests.
            On judicial review, the district court
 reversed the agency decision, determining Andersos 
n’actions on January 21 did not constitute miscondIt 
uct.  concluded that utilization of Winnebago’s own 
“employee relations philosophy” could not be said to 
amount to misconduct justifying the denial of unemployment 
benefits as a matter of law.  Winnebago, it determsubverted 
ined, its own philosophy and put Anderson in a catwhere 
ch-22, he could not question his immediate supervisor 
further up the chain of command on nonfrivolous issues 
without risking repercussions.  Winnebago appeals.

II.            SCOPE AND STANDARD OF REVIEW.
Our review of unemployment benefits cases is governed 
by the Iowa Administrative Procedure Act, Iowa Code 
chapter 17A.  Lee v. Employment Appeal Bd., 616 N.2d 
W.661, 664 (Iowa 2000).  The district court acts in 
an appellate capacity to correct errors at law on the 
part of the agency when engaging in judicial review 
under Iowa Code section 17A.19(10) (2001).[1]  Holland 
Bros. Constr. v. Bd. of Tax Review, 611 N.W.2d 495
, 499 (Iowa 2000).
When we review a district court’s judicial review we 
decision, apply the standards of section 17A.19(10
) to determine whether our conclusions are identical 
to those of the district court.  Id.  Here, the issue 
concerns whether there was substantial evidence to
 support the agency’s finding of misconduct on the
 part of Anderson.  Accordingly, the standard we apply 
is whether the agency’s decision is supported by substantial 
evidence in the record before the court when that record 
is viewed as a whole.  See Iowa Code § 17A.19(10)(
f).
We are bound by agency fact findings that are supported 
by substantial evidence.  Norland v. Iowa Dep’t of
 Job Serv., 412 N.W.2d 904, 913 (Iowa 1987).  Evidence 
is substantial when reasonable minds could accept it 
as adequate to reach the same finding.  Id.
III.            MERITS.
            Winnebago and the Board argue the district 
court erred in determining Anderson’s act of contacting 
the CEO of Winnebago did not constitute misconduct
.  They point out that by Anderson’s own admission
, he knew at the time he contacted the CEO that this 
action constituted misconduct and that he had been
 warned previously about going outside the chain of 
command set forth in the employee handbook.  They contend 
that, in light of his previous history of conduct,
 Anderson’s action on January 21, 1998 constituted
 a deliberate and willful disregard of the standards 
of behavior he knew were expected, and that Winnebago 
had a right to expect.  They maintain the agency decision 
is supported by substantial evidence.
            A claimant is disqualified from unemployment 
benefits if he or she has been discharged for miscIowa 
onduct.  Code § 96.5(2).  Misconduct is:
a deliberate act or omission by a worker which constitutes 
a material breach of the duties and obligations arising 
out of such worker’s contract of employment.  Misconduct 
as the term is used in the disqualification provision 
[is] limited to conduct evincing such willful or wanton 
disregard of an employer’s interest as is found in
 deliberate violation or disregard of standards of
 behavior which the employer has the right to expect 
of employees, or in carelessness or negligence of such 
degree of recurrence as to manifest equal culpabilwrongful 
ity, intent or evil design, or to show an intentional 
and substantial disregard of the employer’s interests 
or of the employee’s duties and obligations to the
 employer.  On the other hand mere inefficiency, unsatisfactory 
conduct, failure in good performance as the result
 of inability or incapacity, inadvertencies or ordinary 
negligence in isolated instances, or good faith errors 
in judgment or discretion are not to be deemed misconduct 
within the meaning of the statute. 
Iowa Admin Code r. 871--24.32(1)(a).  The employer
 bears the burden of proving a claimant is disqualified 
for benefits because of misconduct.  Reigelsberger
 v. Employment Appeal Bd., 500 N.W.2d 64, 66 (Iowa
 1993).  Misconduct serious enough to warrant the discharge 
of an employee is not necessarily serious enough to 
justify a denial of benefits.  Breithaupt v. Employment 
Appeal Bd., 453 N.W.2d 532, 535 (Iowa Ct. App. 199
0).
            We conclude the agency finding that Anderson 
engaged in misconduct, and thus was ineligible for
 unemployment benefits, is supported by substantial 
evidence.  Anderson failed to wait for the departmental 
meeting prior to attempting to raise his concerns with 
the personnel director and the CEO.  He did not follow 
company policy by failing to broach the issue with
 his area manager.  His actions came after his prior 
occurrences of insubordination and his prior warning 
for failure to follow the proper chain of command.
  Anderson knew his conduct on January 21 violated
 that warning and company policy.  We determine that 
his actions are a deliberate act or omission constituting 
a material breach of the duties and obligations arising 
out of his employment with Winnebago.  Thus, we reverse 
the trial court’s decision on judicial review awarding 
Anderson unemployment benefits, and we remand for the 
entry of judgment consistent with this opinion.
            REVERSED AND REMANDED.
[1] The agency proceeding from which Winnebago and
 the Board appeal was conducted on a remand from a
 court after July 1, 1999, and thus the statutory amendments 
in 1998 Iowa Acts chapter 1202, section 24 apply to 
this action.  1998 Iowa Acts ch. 1202, § 46.  For the 
sake of clarity, we will refer to the 2001 Code throughout 
this opinion.