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

DAWN M DONOHUE, Employee

FAMILY FUN DISTRIBUTING INC, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 02402918SH


An administrative law judge (ALJ) for the Division of Unemployment Insurance of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission makes the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The employee worked about one month as a customer service representative for the employer, a wholesaler of general merchandise. Her last day of work was July 1, 2002 (week 27) when she was discharged for theft.

The employee's duties for the employer involved selling items to grocery and convenience stores. The employer also rented mini-storage units. While the employer was out of town the employee rented out a unit. The employer returned and noticed a new contract without any accompanying money. On June 26, 2002, the employer questioned the employee and the employee indicated that she had stuck the money in her pocket and it was at her home. On June 27, 2002, the employee appeared at work but did not return the employer's money for the storage rental. The employer reminded the employee about the money and the employee indicated she forgot about it.

On June 27, 2002, the employee expressed interest in purchasing DVDs before the employer put them on E-Bay. The employee indicated she wanted one or two and the employer indicated that that was okay. The employer was about to post the DVDs on E-bay and noticed that two were missing. The employee was questioned and admitted that she had taken two home. The employer's policy was that items were to be paid for before being removed from the premises. The employee reimbursed the employer on July 1, 2002, for the storage rental and the DVDs.

On July 1, 2002, the employee mentioned to the employer that she had gone to a big flea market in South Milwaukee and ran into one of the employer's customers who purchases Beanie Babies from the employer. Later that day, the customer called the employer and indicated that he had been bothered by an encounter he had with the employee. The customer indicated that the employee had approached him about purchasing two sets of Beanie Babies for $240.00 per set. The customer had told the employee that he did not know if it was a good price and would have to check it out. The customer then gave the employee an invoice containing his name and phone number. The employee then asked if he bought from the employer. When the customer indicated he did, the employee stated that she did not want to interfere with that relationship and left. After the employee left, the customer realized the employee worked for the employer but was not doing so when offering the Beanie Babies for sale.

After receiving the above information from the customer, the employer matched its purchases against sales and found it was short two sets of Beanie Babies. The employer questioned the employee and she denied taking any Beanie Babies. The employee stated that she had approached the customer as a representative of the employer. The employer asked the employee how she knew what to charge for the sets. The employee replied that she figured the price by the packing slip that showed what the employer had paid for them. She wanted to sell them for what the employer had paid for them. Later that day the employer notified the employee that she was being discharged.

The issue to be decided is whether the employee was discharged for misconduct connected with her work for the employer. In Boynton Cab Co. v. Neubeck & Ind. Comm., 237 Wis. 249, 296 N.W. 636 (1941), the leading case with respect to the meaning of the term "misconduct" as applied to unemployment compensation in the United States, the court said, in part, as follows:

" . . . the intended meaning of the term 'misconduct' . . . is limited to conduct evincing such wilful or wanton disregard of an employer's interests as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect of his employee, or in carelessness or negligence of such degree or recurrence as to manifest equal culpability, wrongful 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 his 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' with in the meaning of the statute."

The employee's conduct during the workweek before her discharge gave the employer reason to question her honesty. The employee removed money due the employer from the premises and did not mention the money until the employer raised the issue with her. Even when directed to return the money she did not do so at the next opportunity, i.e. when she reported for work on Friday. Likewise, the employee did not inform the employer that she had removed the DVDs without paying for them until the employer raised the matter with her. Further, the employee's conduct in removing items before paying for them violated the employer's policy.

The combination of the employee's admitted conduct and illogical explanations for her conduct at the flea market support the conclusion that the employee was attempting to sell the employer's product for her own financial gain. The employee confirmed the customer's report of a meeting at which the employee attempted to sell the customer two sets of Beanie Babies. The employee did not sell Beanie Babies in the course of her work for the employer. The employer was missing two sets of Beanie Babies. The employee's claim that she was going to sell the Beanie Babies at the price the employer paid for them could be most favorably looked upon as indicating the employee's utter incompetence if acting as the employer's representative. However, considering the entire record the commission finds that the employee was attempting to sell the employer's property, which she had taken from the employer, for her own personal gain, and not as a representative of the employer.

The employee's position requires believing that the employee approached the employer's customer while off duty, to sell items she did not normally sell, to an individual she did not sell to, and for the same price as the employer paid for the items. Why it would be to the employer's benefit to have the employee sell the employer's products at a price that would not result in a profit to the employer is beyond the commission's comprehension. The employee did not appear at the hearing in this matter to explain her conduct. The commission finds that the evidence presented by the employer and inferences that may be drawn from that evidence establish that the employee engaged in theft of the employer's property.

The commission therefore finds that in week 27 of 2002 the employee was discharged from her employment and for misconduct connected with her work within the meaning of Wis. Stat. § 108.04(5).

The commission further finds that the employee was paid benefits in the amount of $2,140.00 for weeks 27 through 43 of 2002, for which the employee was not eligible and to which the employee was not entitled, within the meaning of Wis. Stat. § 108.03(1).

The final issue to be decided is whether recovery of overpaid benefits must be waived.

Wisconsin Statute § 108.22(8)(c), provides that the department shall waive the recovery of overpaid benefits if the overpayment was the result of departmental error, and the overpayment did not result from the fault of the employee. Under Wis. Stat. § 108.02(10e)(a) and (b), department error is defined as an error made by the department in computing or paying benefits which results from a mathematical mistake, miscalculation, misapplication or misinterpretation of the law or mistake of evidentiary fact, or from misinformation provided to a claimant by the department, on which the claimant relied.

The overpayment in this case results from the commission's reversal of the appeal tribunal decision. Such reversal was not due to department error as defined in Wis. Stat. § 108.02(10e)(a) and (b).

The commission further finds that waiver of benefit recovery is not required under Wis. Stat. § 108.22(8)(c), because although the overpayment did not result from the fault of the employee as provided in Wis. Stat. § 108.04(13)(f), the overpayment was not the result of a department error. See Wis. Stat. § 108.22(8)(c)2.

DECISION

The decision of the administrative law judge is reversed. Accordingly, the employee is ineligible for benefits beginning in week 27 of 2002, and until seven weeks elapse since the end of the week of discharge and the employee has earned wages in covered employment equaling at least 14 times the weekly benefit rate which would have been paid had the discharge not occurred. The employee is required to repay the sum of $2,140.00 to the Unemployment Reserve Fund.

For purposes of computing benefit entitlement: Base period wages from work for the employer prior to the discharge shall be excluded from any computation of maximum benefit amount for this or any later claim. If the employee was also paid base period wages from work by other covered employers, the excluded wages shall be used to determine benefit eligibility. However, any benefits otherwise chargeable to a contribution employer's account shall be charged to the fund's balancing account.

Dated and mailed March 19, 2003
donohda . urr : 132 : 1 :  MC 630.14

/s/ David B. Falstad, Chairman

/s/ James A. Rutkowski, Commissioner

James T. Flynn, Commissioner


MEMORANDUM OPINION

The commission did consult with the ALJ who presided at the hearing regarding his impressions of witness credibility and demeanor. The ALJ found the employer's witness credible. The ALJ indicated that his decision was based on the sufficiency of the employer's evidence and not on any adverse credibility impression of the employer's witness. The commission agrees with the ALJ's credibility impression but disagrees that the employer's evidence was insufficient to meet its burden of proof.

NOTE: Repayment instructions will be mailed after this decision becomes final. The department will with hold benefits due for future weeks of unemployment in order to off set over payment of U.I. and other special benefit programs that are due to this state, an other state or to the federal government.

Contact the Unemployment Insurance Division, Collections Unit, P. O. Box 7888, Madison, WI 53707, to establish an agreement to repay the over payment.


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uploaded 2003/04/04