JESSE SALINAS, Claimant

A department deputy's initial determination issued on June 12, 1987, held that the claimant was not eligible for trade readjustment allowance benefits (TRA) because his separation from adversely affected employment was not due to a lack of work. The claimant timely appealed and a hearing was held. The appeal tribunal decision, issued on August 10, 1987, reversed the initial determination and allowed TRA. The department timely petitioned for review by the Commission.

Based on the evidence and applicable law, the Commission makes the following:

The claimant worked for J. I. Case Company for approximately 19 years. His last day of work was July 2, 1986 (week 27), when he was discharged.

When the claimant applied for regular unemployment compensation, the employer challenged his eligibility, contending that he was discharged for misconduct connected with his employment. Specifically, the employer contended that the employe was discharged for the use of threatening or obscene language toward a supervisor, in violation of a work rule. That unemployment compensation eligibility issue was heard by an appeal tribunal which issued its decision on September 5, 1986, finding that the claimant's objectionable language was addressed to a co-worker rather than the supervisor and concluding that the claimant's conduct, while not satisfactory to the employer, did not rise to the level of misconduct within the meaning of section 108.04 (5) of the statutes. Accordingly, the appeal tribunal decision issued on September 5, 1986, allowed unemployment compensation to the claimant. He received and exhausted regular unemployment compensation.

When the claimant exhausted his regular unemployment compensation, the department examined his eligibility for TRA. In the initial determination issued on June 12, 1987, the department held that the claimant's discharge did not constitute a layoff for lack of work and he was therefore ineligible for TRA. The claimant timely appealed and a hearing was held. The appeal tribunal decision, issued on August 10, 1987, reversed the initial determination and allowed TRA. The department timely petitioned for commission review, pursuant to its authority under sections 108.09 (6)(a) and (e) 3, Wis. Stats.

The issue to be resolved is whether the claimant is eligible for TRA in view of the undisputed fact that he was discharged rather than being laid off for lack of work.

The Trade Act of 1974, as amended, differs from the Wisconsin Unemployment Compensation Act in many respects. Pursuant to section 108.02(11), Wis. Stats., a claimant for regular unemployment compensation is deemed or presumed eligible for such benefits unless the employer or the department establishes that he is disqualified by a specific provision of Chapter 108 (such as the misconduct disqualification). Neither the Trade Act nor the applicable federal regulations provide any equivalent presumption of eligibility for TRA.

20 CFR 617.11 (a) provides:

"To qualify for TRA for any week of unemployment, an individual must meet each of the following requirements..."

The first and most fundamental of those requirements is the requirement, under 20 CFR 617.11 (a)(1), that the claimant must be an "adversely affected worker." The special definition of that term, for TRA purposes, is provided at 19 U.S.C. 2319 (2) and 20 CFR 617.3 (c), both of which state that an adversely affected worker is:

"...An individual who, because of lack of work in adversely affected employment . . . has been totally or partially separated from such employment..."

There is no Wisconsin court case addressing the issue of whether a "discharge but not for misconduct" may be treated as a layoff for lack of work for TRA purposes. However, in Embaby v. Dept. of Jobs and Training, 397 N.W. 2d 609 (Minn. Ct. App. 1985), the Minnesota Court held that a TRA claimant who was discharged because of continuing medical restrictions, and was allowed unemployment compensation over the employer's objection, was nonetheless ineligible for TRA because he was not laid off for lack of work and therefore was not an adversely affected worker.

Here, it was finally found in an unappealed unemployment compensation appeal tribunal decision that this claimant was discharged for conduct unsatisfactory to the employer (even though statutory misconduct was not found). The Minnesota claimant, Embaby, apparently was not at fault in any degree, yet the Minnesota Court was unwilling to treat his discharge as a layoff for lack of work for TRA purposes.

In allowing TRA in the instant case, the administrative law judge reasoned that since the Trade Act's definition of "total separation" includes a "layoff or severance," a discharge like the one in this case should be treated as a "total separation" for TRA purposes. That reasoning is correct, as far as it goes. However, as discussed above, the first requirement for eligibility is that the claimant must be an "adversely affected worker" which, again, is defined both in the Trade Act and the federal regulations, as an individual whose separation from employment was because of lack of work.

The Commission therefore finds that the claimant is not eligible for TRA based on his separation from employment on July 2, 1986 (week 27) because such separation was not for lack of work in adversely affected employment and claimant therefore was not an adversely affected worker within the meaning of the Trade Act.

The appeal tribunal decision is reversed. Accordingly, the claimant is not eligible for TRA based on his separation from adversely affected employment in week 27 of 1986.

Dated and mailed September 2, 1987
200 - CD8197  TRA

/s/ Hugh C. Henderson, Chairman

/s/ Carl W. Thompson, Commissioner

/s/ Pamela I. Anderson, Commissioner

NOTE: The Commission's decision is not based on credibility considerations; the Commission has reversed the appeal tribunal decision as a matter of law.

cc: 
Rick Gerardo, Bargaining Committee Man, Local 180
J. I. Case Company

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