STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)


BEVERLY E GHERARDINI, Employe

SHARKEYS, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 97401861GB


On July 17, 1997, the Department of Workforce Development issued an initial determination in the above-captioned matter which held that the employe quit, but not for a reason which would allow benefits. The employe filed a timely appeal and a hearing was held before an appeal tribunal. On August 26, 1997, the appeal tribunal issued a decision which affirmed the initial determination. As a result, benefits were denied. The employe filed a timely petition for commission review of the appeal tribunal decision.

Based on the applicable law, records and evidence in this case, the commission makes the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The employe worked for the employer, a restaurant, for approximately seven months as a cook. Her last day of work was June 29, 1997 (week 27).

The employe was hired to work for the employer on a full-time basis at a pay rate of $7.50 per hour. She was not told at the time of her hire that the employer's business was seasonal and was not aware that her hours would decrease during the summer months. At the beginning of her employment the employe averaged between 70 and 75 hours per two week pay period. However, starting in March of 1997 her hours were reduced and from March through June of 1997 she averaged only about 60 hours per pay period. The employe made the employer aware that she needed more hours, but the employer was not able to assign her any additional hours due to a seasonal downturn in its business.

At the time of her hire the employe's supervisor also told the employe that she would receive an evaluation and raise after three months. The supervisor stated that she had never seen a raise of less than $1 per hour. However, after about three months of service the employe talked to her supervisor about raises and was told that there would be no raises because the employer was undergoing some renovation. The employe also talked to the employer's manager, who stated that raises would not be given until 1998.

On or about June 9, 1997, the employe told the employer she was going to have to quit effective June 29 (week 27) because of the reduction in her hours and the fact that she did not receive a raise as promised. The employe was not aware that she could remain employed and apply for partial benefits and the evidence did not establish that the employer had a "Notice To Employes" poster posted where the employe would readily see it.

The issue to resolve is whether the employe's quitting was for a reason permitting the immediate payment of benefits.

Under Wis. Stat. § 108.04(7)(a), an employe who voluntarily terminates employment with an employer is ineligible for benefits unless the quitting falls within a statutory exception permitting the immediate payment of benefits. One such exception is Wis. Stat. § 108.04(7)(b), which provides that, if an employe voluntarily terminates employment with good cause attributable to the employing unit, he or she is eligible for the immediate payment of unemployment benefits. Good cause attributable to the employer means that the employe's resignation is caused by some act or omission by the employer which justifies the employe's decision to quit. It involves some fault on the employer's part and must be real and substantial. Kessler v. Industrial Comm., 27 Wis. 2d 398, 134 N.W.2d 412 (1965); Hanmer v. DILHR, 92 Wis. 2d 90, 98, 284 N.W.2d 587 (1979).

The appeal tribunal found that the employe did not have good cause to quit, reasoning that a worker does not have a right to expect a raise and that, where an employe's hours are reduced the employe is expected to remain employed and file a claim for partial benefits. The appeal tribunal further noted that the employer was not obligated to make the employe aware of her eligibility for partial benefits and that, because both the lack of a raise and reduction in hours were due to valid business reasons on the part of the employer, no employer fault was established such as would give the employe good cause to quit.

The commission agrees with the appeal tribunal that a worker does not generally have a right to expect a pay increase. However, in this case the employe was specifically notified that she would receive a raise after three months and did have a right to rely on that representation. Further, although the employer's failure to give the employe a raise was related to a valid business decision to undergo remodeling rather than increase workers' salaries, the employer was nonetheless remiss in promising a raise that it was subsequently unwilling or unable to provide.

With respect to the reduction in the employe's hours, the commission believes that this case presents an exception to the general rule that a seasonal reduction in hours will not provide a worker with good cause for quitting. First, the employe was not hired to work on a seasonal basis and did not understand that her hours would be reduced in the summer. Second, and more importantly, the rationale that a worker whose hours are reduced should remain employed and file for partial benefits does not apply in this case because the employe was unaware of the availability of partial benefits and the employer failed in its obligation to post a notice that would have made her aware of this possibility. (1) An employer who reduces an employe's hours and then does not comply with the legal requirement that it post a notice regarding the availability of unemployment benefits has created a situation in which the employe would be justified in quitting rather than limiting herself to part-time work with no benefits to compensate for the loss.

While either the failure to provide a promised raise or the unexpected reduction in working hours, when taken singly, might be considered insufficient to justify the employe's decision to quit, the commission believes that the combination of these adverse factors created a situation in which the employe was justified in becoming unemployed rather than accept them.

The commission, therefore, finds that in week 27 of 1997 the employe voluntarily terminated her work with the employer, and that her quitting was with good cause attributable to the employer, within the meaning of Wis. Stat. § 108.04(7)(b).

DECISION

The appeal tribunal decision is reversed. Accordingly, the employe is eligible for benefits beginning in week 27 of 1997, provided she is otherwise qualified. There is no overpayment with respect to this issue.

Dated and mailed: February 26, 1998
gherabe.urr : 164 : 1  VL 059.201  VL 1059.204

/s/ David B. Falstad, Chairman

/s/ James A. Rutkowski, Commissioner

NOTE: The commission conferred with the administrative law judge about witness credibility. The administrative law judge indicated that all of the witnesses seemed honest and credible. The administrative law judge also stated that she thought the employer probably did have a poster up, in spite of the fact that the employer's witness was unable to affirmatively state that this was the case and did not know what the poster was. However, the administrative law judge indicated that she felt the poster or lack thereof was irrelevant to the decision, since the employe could have contacted the department to inquire about the availability of partial benefits. The commission's decision to reverse the appeal tribunal decision is not the result of any differing assessment of witness credibility but, for the reasons set forth in the body of the decision, the commission disagrees with the legal analysis applied by the appeal tribunal.

 

Pamela I. Anderson, Commissioner (dissenting):

I am unable to agree with the result reached by the majority herein and I dissent.

The majority finds that the employer was unable to testify with certainty that they had a required poster which would give the employe notice about partial benefits. When we talked to the administrative law judge, she said she found the employer to be very credible and believed that they did have the poster on display.

The employer's testimony was "I believe we do have a poster up in the waitress area." The only testimony the employe gave, regarding this issue, was "I did not realize that I would be eligible for partial unemployment benefits if I had filed because of a reduction in hours." And "I wish I had been told about partial unemployment benefits before I quit my employment." Neither of these statements refutes the employer's statement that there was a poster at work.

The employe was only scheduled for 40 hour weeks once. The reduction in her hours was less than 3 hours per week when you do not include the weeks she took vacation or the weeks after she announced her quit.

For these reasons, I would affirm the appeal tribunal decision.

Pamela I. Anderson, Commissioner


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Footnotes:

(1)( Back ) An employer is required to post "Notice to Employes" posters where all workers will readily see them. Wis. Admin. Code § DWD 120.01. The employe alleged that there was no such poster and, although the employer was put on notice of this allegation prior to the hearing, the employer's owner was unable to testify with certainty whether the employer had one or not.