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

RANDALL D HAUSER, Employee

CLARK RETAIL ENTERPRISES INC, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 02605424MW


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 as a store manager for over two years for the employer, a gasoline and convenience service station. He was discharged by the employer on May 14, 2002, (week 20) his last day of work.

The employee's wife also worked for the employer, but she worked at a store other than the employee's. The employee's wife had numerous restrictions upon the hours she could work, so her manager was not able to schedule her for forty hours per week. On a weekly basis, the employee would contact the marketing manager of her store, to see how many hours his wife worked. The employee would then indicate that she worked at his store whatever number of hours was necessary to bring her hours up to forty for each week. The employee's wife was not at work during some of the times that she was on the schedule. The employer had a work rule that provided that workers were responsible for completing their timesheets and a manager is not allowed to write in their time. The employee filled out his wife's timesheets in spite of this rule. The employer discharged the employee for falsifying his wife's timesheets.

The issue to be resolved is whether the employee was discharged for misconduct connected with his employment.

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."

It was the employer's position that the employee had been discharged for misconduct connected with his work. The commission agrees. The employee contended that his wife worked all of the hours that were reported for her. He indicated that although she was not at his store during some of the time that she was on the schedule, she worked the number of hours he reported. He testified that the schedule and actual records rarely matched because things charged due to the nature of the business.

The employee also stated that his prior manager did not want him to report overtime, and so he banked hours for his wife and added them in weeks that she worked less than forty hours. The commission did not find the employee's explanations to be credible. The employee stated that he would often fill in timesheets for workers using the schedule. However, he also testified that his wife's hours did not correspond to the schedule because the schedule was inaccurate. If the schedule was inaccurate, it was unlikely that the employee would rely upon it to fill in the timesheets of other workers.

The employee further asserted that he had kept track of his wife's hours. However, he could not produce this record at the hearing because he stated that he threw it away when the initial determination allowed benefits. Given the fact that the initial determination contained specific appeal rights information this was reckless, and causes the commission to doubt that such record existed. Furthermore, if the employee's wife had so many restrictions on her hours that her own store manager was unable to schedule her for forty hours per week it seems extremely unlikely that the employee's wife was able to work in excess of forty hours for a number of weeks. In addition, the employee filled out a written statement that indicates that his prior supervisor told the employee to pay his wife a few hours of overtime on a weekly basis because his "labor was shot anyway." (Exhibit 8). This was inconsistent with his hearing testimony that the prior supervisor told him to pay his wife in this manner to avoid overtime.

The employee further asserts that his manager, who was discharged in December of 2001, instructed him to keep track of his wife's hours and add them to later weeks. In this way the employer would avoid paying her overtime. However, a co-worker testified that she would report hours in excess of forty when the prior manager was still working for the employer. Reporting workers' hours in this manner is not legal and given this and the fact that the co-worker reported her overtime hours, the commission does not find the employee's testimony in this regard to be credible.

The commission further notes that the employee testified that he did in fact falsify the employer's records, although he stated that the records he falsified were not payroll records. The employee testified that he was supposed to go through the New Hire Orientation book with all new hires. He testified that he did not go through the book with the new hires, but signed that he did.

The employee's actions in paying his wife for hours that she was not on the schedule was dishonest, and demonstrated such a wilful and substantial disregard of the employer's interests as to constitute misconduct connected with his work.

The commission therefore finds that in week 20 of 2002, the employee was discharged for misconduct connected with his employment within the meaning of Wis. Stat. § 108.04(5).

The commission further finds that the employee was paid benefits for weeks 20 through 27 of 2002, amounting to a total of $2,538.00 for which he was not eligible and to which he is not entitled, within the meaning of Wis. Stat. § 108.03(1). Pursuant to Wis. Stat. § 108.22(8)(a), the employee is required to repay such sum to the Unemployment Reserve Fund.

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 20 of 2002, and until seven weeks have elapsed since the end of the week of discharge and the employee has earned wages in covered employment performed after the week of discharge equaling at least 14 times the employee's weekly benefit rate which would have been paid had the discharge not occurred. The employee is required to repay the sum of $2,538.00 to the Unemployment Reserve Fund.

The initial benefit computation (UCB-700), issued on May 15, 2002, is set aside. If benefits become payable based on work performed in other covered employment a new computation will be issued as to those benefit rights.

Dated and mailed May 7, 2003
hausera . urr : 145 : 1   MC 630.09

/s/ David B. Falstad, Chairman

/s/ James A. Rutkowski, Commissioner

/s/ James T. Flynn, Commissioner


MEMORANDUM OPINION

The commission discussed witness credibility and demeanor with the ALJ who held the hearing. The ALJ stated that he found the employee's statement that his supervisor told him not to pay his wife overtime to be extremely credible because the supervisor would want to limit overtime pay. The ALJ did note that he was troubled by the employee's statement that he made a log of his wife's hours and threw that log away after receiving a favorable initial determination. On the other hand, the ALJ indicated that people may not be aware of the appeal rights that flow from the determination, and the employee may simply have wanted to forget the past. The commission disagrees with the ALJ's credibility determination for the reasons stated in its decision.

cc: 
Clark Retail Enterprises, Inc. (Oak Brook, Illinois)
Clark Retail (Milwaukee, Wisconsin)


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