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

DANIEL D FREI, Employee

ELROY MFG INC, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 03003853MD


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 for about five months as an engineering manager for the employer, a manufacturer of cold-formed steel wire products. His last day of work was April 14, 2003 (week 16), when he quit.

The employee and a sister company with a plant about twelve miles away share top management and sometimes transfer employees from one to the other. About two weeks before the employee's last day, the president of both companies proposed that the employee head a marketing and engineering group for both. The employee told the president he was not interested because he wanted to return to the Wausau area so that he could seek placement of his children with him. He proposed that the employer permit him to do sales work in the Wausau area, but the employer was not interested.

Because of the employee's plans to eventually relocate outside of practical commuting range, the employer did not want him in the position of project manager or to have extensive customer contact. On his last day of work, the president said he was assigning the employee to perform drafting and design work at the sister company plant in Mauston, as the employer did not have such work in Elroy. The president also told him that his new pay rate would be hourly and would be lower than his present salary. The president did not give him any further information than that. While en route from Elroy to the Mauston plant, the employee decided to quit instead of accepting the transfer, and telephoned his immediate supervisor with his decision. He followed up with a written resignation effective immediately.

The employee contended that his quitting was with good cause attributable to the employer because the transfer was a substantial demotion. He had been salaried at $1,200 per week in his previous managerial position, for which he was expected to work 45 hours per week and did not receive overtime pay or overtime premium. Although the employer had not established a precise rate for the new position, the president credibly testified that its range was the $18 to $21 per hour that its other drafters/designers earned and would have included premium pay for hours exceeding 40 per week. The employee would have retained other fringe benefits had he accepted the position.

In this case, the employee's quitting was with good cause attributable to the employer. The employee was being transferred to a position that was at a lower level of skill and a significantly lower rate of pay than his most recent position. The employer did not decide to demote him for disciplinary reasons. The employer decided to demote him because he expressed an interest in eventually moving to Wausau so he could spend more time with his children. The employer informed him that he would be making significantly less, and the employer's hearing testimony indicated that the employee would be making over $8,000 less per year using the figures most generous to the employer. Using the figures least generous to the employer the employee would have sustained a pay decrease of $24,960. The employer asserted that the employee would be paid overtime, but the commission could not include that figure in its calculations because that is speculative. In addition, the employer did not indicate what it estimated the employee could have made in overtime pay. It was not even aware at the time of the hearing of the wage it intended to pay the employee.

The commission therefore finds that in week 16 of 2003, the employee voluntarily terminated his employment, but that his quitting was with good cause attributable to the employer within the meaning of Wis. Stat. § 108.04(7)(b).

DECISION

The decision of the administrative law judge is reversed. Accordingly, the employee is eligible for benefits beginning in week 16 of 2003, if otherwise qualified.

Dated and mailed April 13, 2004
freida . urr : 145 : 1  VL 1035  VL 1080.269

/s/ David B. Falstad, Chairman

/s/ James T. Flynn, Commissioner

/s/ Robert Glaser, Commissioner




MEMORANDUM OPINION

The commission did not discuss witness credibility and demeanor with the ALJ who held the hearing. The commission did not reverse the ALJ's decision because it reached a different assessment of witness credibility and demeanor but because it reached a different legal conclusion when applying the law to the facts found by the ALJ.


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uploaded 2004/04/14