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

DANIEL R DREIFUERST, Employee

VERIZON NORTH INC, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 04400060FL


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 agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own.

DECISION

The decision of the administrative law judge is affirmed. Accordingly, the employee is ineligible for benefits beginning in week 47 of 2003 and until four weeks have elapsed since the end of the week of quitting and he has earned wages in covered employment performed after the week of quitting equaling at least four times his weekly benefit rate which would have been paid had the quitting not occurred. The employee is required to repay the sum of $658 to the Unemployment Reserve Fund.

Dated and mailed June 18, 2004
dreifda . usd : 115 : 1 VL 1007.01  VL 1007.15 

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner


MEMORANDUM OPINION

The employer decided it needed to reduce costs in order to stay competitive. As one of the means to achieve this, it instituted a voluntary early retirement program and offered it to certain workers, including the employee. The employer expected several thousand management employees to take advantage of this program "which would enable the company to meet its workforce reduction needs for the rest of the year." (exhibit #4, page 6).

The employee feared that, as a planner, his position would be subject to elimination if the employer were unable to achieve sufficient cost savings through its early retirement program and its other budget reduction initiatives. As a result, he opted for early retirement.

Opting to accept early retirement is a quit of employment. Leintz v. Fort James Operating Co., UI Hearing No. 99402693AP (LIRC Dec. 30, 1999); Cole v. Lindberg Division, UI Hearing No. 99002540WT (LIRC Nov. 22, 1999).

The only exception to the quit disqualification arguably applicable here is that set forth in Wis. Stat. § 108.04(7)(am), which states as follows:

108.04(7)(am) Paragraph (a) does not apply if the department determines that the suspension or termination of the claimant's work was in lieu of a suspension or termination by the employer of another employee's work. The claimant shall not be deemed unavailable for the claimant's work with the employer by reason of such suspension or termination.

In affirming a decision of the commission, the Court of Appeals, in Berry et al. v. LIRC and Dept. of Military Affairs, 213 Wis.2d 397, 570 N.W.2d 610 (Ct. App. 1997), stated as follows in interpreting this statutory provision:

. . . We fail to see how a claimant could establish that his or her voluntary termination was "in lieu of" another employee's involuntary termination unless the claimant can identify another individual, or group of individuals, who were able to keep working as a direct result of the claimant's voluntary action.

. . . [This interpretation of the provision] ensures that an employee who voluntarily steps forward to accept a layoff so that another may avoid that fate, takes his colleague's place not only in the unemployment line, but also as a rightful recipient of unemployment compensation benefits. The "one-for-one" interpretation serves to separate that circumstance from those present here, where employees responded to separation incentives offered by an employer as a general cost-cutting or down-sizing measure. These claimants elected to accept the separation incentives without knowing whether any department employees would ultimately be involuntarily suspended or terminated.

. . . The commission does not require that an employee be able to identify the individual or individual position saved by his quitting. What the commission does require is that there be credible evidence that the employer had definitely elected to terminate or suspend one ore more people, and that the employee claiming the statutory exception can demonstrate that he accepted termination or suspension in lieu of termination or suspension of some other employee. We conclude that this represents a rational way in which to interpret and apply the statute.

The employee here failed to identify any individual or group of individuals who faced certain layoff if the employee did not accept the early retirement option. A simple reference to workforce reduction needs or downsizing would not satisfy this requirement. Berry, supra.

 


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uploaded 2004/06/21