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Colorado Workers for Innovative and New Solutions v. Gherardini.

2023 COA 80. No. 22CA1260. State Administrative Procedure Act—Colorado Partnership for Quality Jobs and Services Act—Hearings and Determinations—Initial Decisions—Judicial Review—Final Agency Action—Colorado State Labor Relations Rules—Appeals of Coverage Decisions by the State Personnel Director.

September 14, 2023

The Colorado Department of Public Health and Environment (CDPHE) hired Morgan as a public health and community outreach professional, and Morgan’s position was later reclassified as a position with more supervisory authority. Morgan subsequently received notice that CDPHE had determined that he was a “non-covered” employee under the Colorado Partnership for Quality Jobs and Services Act (Partnership Act), which allows a “certified employee organization” to represent “covered employees” in bargaining collectively with the state over wages, hours, and terms and conditions of employment. Colorado Workers for Innovative and New Solutions (WINS) is the certified employee organization for the partnership unit composed of all covered employees under the Partnership Act, and it sought review by CDPHE’s state personnel director of the determination that Morgan was not a covered employee. The state personnel director affirmed CDPHE’s decision and clarified that Morgan’s position was not covered because his job duties fell within the executive employee exemption. WINS appealed the state personnel director’s decision to the Division of Labor Standards and Statistics (Division), and the Division assigned the matter to a hearing officer. The hearing officer sustained the state personnel director’s coverage decision. The hearing officer’s order contained an appeal rights section that referenced the exceptions and agency review procedure for an “initial decision” issued by a hearing officer under CRS § 24-4-105(14)(a)(II). WINS requested clarification of the appeals process, noting the conflict between the appeal advisement in the hearing officer’s order and Division Rule 5.7, which deemed the hearing officer’s decision “a final agency action” subject only to judicial review under CRS § 24-4-106. WINS also timely filed exceptions to the hearing officer’s order. The hearing officer then issued a corrected order advising that any party wishing to appeal must do so by filing an action for judicial review in district court and cited, as relevant here, CRS § 24-4-106. The hearing officer also concluded that the exceptions WINS filed were moot and explained that the Division Rule 5.7 appeal process controlled. WINS appealed the hearing officer’s order to the district court, which concluded that the hearing officer’s order was final and affirmed it.

On appeal, WINS contended that the district court erred by concluding that the hearing officer’s decision was a final agency action subject to judicial review under CRS § 24-4-106 of the State Administrative Procedure Act (APA) rather than an initial decision subject to further agency review under CRS § 24-4-105(14)(a)(II). The court of appeals first concluded that Division Rule 5.7 deprives a party of its right to appeal a hearing officer’s decision via the exceptions procedure in CRS § 24-4-105(14)(a)(II) and is thus void. The court also concluded that the APA does not conflict with but supplements the appeal procedures set forth in the Partnership Act. Accordingly, the Division must follow both the APA and the Partnership Act. If the Division assigns a hearing officer to decide appeals of the state personnel director’s coverage decisions under the Partnership Act, the hearing officer’s decision is an initial decision subject to further agency review by the CRS § 24-4-105(14)(a)(II) exceptions procedure. Under the APA, a hearing officer’s initial decision becomes final only if no exceptions or agency motions are submitted within the allotted time. Here, WINS was statutorily entitled to appeal the hearing officer’s initial decision to the agency by filing exceptions, and the record reflects that it timely filed such exceptions but was denied further agency review. Accordingly, the district court’s judgment affirming the hearing officer’s decision cannot stand.

The judgment was reversed, and the case was remanded to the district court with instructions to remand to the Division to conduct further proceedings consistent with CRS § 24-4-105.

Official Colorado Court of Appeals proceedings can be found at the Colorado Court of Appeals website.

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