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

KENNARD PITTMAN, Employee

EMMPAK FOODS INC, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 04600783MW


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 initially and the evidence submitted at the remand hearing. Based on its review, the commission makes the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

Wispak Transport (Wispak) and Emmpak Foods Incorporated (Emmpak) are meat processing businesses which have separate unemployment insurance account numbers even though the businesses are related divisions. In August 2001, one purchased the other and, in 2002, both operated at the same Butler, Wisconsin location.

On October 7, 2002 (week 41), the employee started working as a general production worker for Emmpak, at the Butler meat processing facility where Wispak also operated. The employee worked from 3:30 p.m. to midnight Monday through Friday and was paid $8.00 per hour. The rate of pay was not substantially less favorable when compared to similar work in the labor market.

After the employee's last day of work on November 5, 2002 (week 45), the employee never returned to work for the employer or contacted the employer. Under the employer's attendance policy, a worker who is absent for three consecutive days of no-call/no-show is considered to have voluntarily terminated his or her employment. Consequently, on Monday, November 11, 2002 (week 46), the employee was removed from the employer's employment records.

When the employee initiated his claim for unemployment insurance benefits on November 18, 2002 (week 47), he reported that he was discharged from Wispak. The next day, the Unemployment Insurance Division (Division) mailed Wispak a separation report indicating that the employee had reported his employment and separation with Wispak. The report was not to be returned if Wispak agreed with the contents therein. Wispak did not return the report.

Additionally, on December 11, 2002, a human resources representative from Wispak verified the employee's wages with a Division representative and indicated that the employee had started his employment with Wispak on October 7, 2002. Based on information provided to the Division by Wispak, a determination was issued finding that the employee was discharged from Wispak and the discharge was not for misconduct. The determination was not appealed. The employee started receiving unemployment insurance benefits. The employee ceased claiming after receiving benefits totaling $2,052.00.

Emmpak then reported the employee's wages under its unemployment insurance account number. In December 2003, the employee opened a new claim for unemployment insurance benefits after subsequent covered employment in which he earned at least four times his weekly benefit rate. When the Division reviewed the account number under which the employee's wages were reported, an amended determination was issued on January 9, 2004 finding that the employment and the week 46 of 2002 separation was with Emmpak, not with Wispak. Emmpak appealed the no misconduct finding and a hearing was held. The appeal tribunal issued a decision affirming the no misconduct finding, which Emmpak petitioned.

The first issue for the commission is whether the employee quit or was discharged by Emmpak and his eligibility for unemployment insurance benefits.

The employee stopped reporting to work after November 5, 2002. He was absent three consecutive days without notice and had been apprised by the employer's attendance policy that such behavior would be treated as a voluntary termination of employment. The employee did not attempt to contact the employer thereafter and did not appear at the hearing to explain his behavior. He abandoned his job and his behavior constituted a quitting as of week 46 of 2002.

Wis. Stat. § 108.04(7)(a) provides that an individual who quits a job will have all of his or her benefit eligibility suspended unless the circumstances of his or her quitting fall within the exceptions stated in the law.

Generally, it is an employee's burden to establish that his or her quitting falls within an exception to allow for immediate payment of benefits. However, in the case of a quitting within the first ten weeks of employment, if a worker's wages are substantially less favorable than those for similar work in the labor market, he or she will not be denied benefits. See Wis. Stat. § 108.04(7)(e) and Wis. Stat. § 108.04(9). Thus, even though the employee did not appear at either hearing in this matter, labor market testimony was presented regarding the employee's rate of pay. Since the employee's wages were not substantially less favorable, this exception does not apply. Additionally, no evidence was presented to establish that the employee's quitting was within any other exception to allow for the immediate payment of unemployment insurance benefits.

Given the fact that the employee's quitting was not within any exception to allow for the immediate payment of benefits, he is ineligible for benefits until four weeks have elapsed after his quitting and until he has earned four times his weekly benefit rate in subsequent covered wages. The employee did not earn the required amount until his new benefit claim in December 2003. As such, he was not entitled to the $2,052.00 in unemployment insurance benefits paid to him based upon the claim he initiated in 2002.

The next issue to be decided is the basis of the erroneously paid benefits and the resulting treatment of those benefits.

Wis. Stat. § 108.04(13)(c) provides, in relevant part, as follows:

If an employer, after notice of a benefit claim, fails to file an objection to the claim under section 108.09(1) any benefits allowable under any resulting benefit computation shall, unless the department applies a provision of this chapter to disqualify the claimant, be promptly paid. Except as otherwise provided in this paragraph, any eligibility question in objection to the claim raised by the employer after the benefit payments to a claimant are commenced does not affect benefits paid prior to the end of the week in which a determination is issued as to the eligibility question unless the benefits are erroneously paid without fault on behalf of the employer. . . If benefits are erroneously paid without fault on the part of the employer, regardless of whether the employee is at fault, the department shall charge benefits as provided in par.(d), unless par. (e) applies, and proceed to create an overpayment under s. 108.22(8)(a). If benefits are erroneously paid because an employer is at fault and the department recovers the benefits erroneously paid under s. 108.22(8)(a), the recovery does not affect benefit charges made under this paragraph.

Wis. Stat. § 108.04(13)(e) provides, in part, as follows:

If the department erroneously pays benefits from one employer's account and a 2nd employer is at fault, the department shall credit the benefits paid to the first employer's account and charge the benefits paid to the 2nd employer's account. . . If the department recovers the benefits erroneously paid under s.108.22(8), the recovery does not affect benefit charges made under this paragraph.

The employee was originally paid the $2,052.00 in unemployment insurance benefits when Wispak agreed he was its employee and did not challenge his eligibility for benefits. The Division's witness testified that the employee was not at fault in the erroneously paid benefits and the commission agrees. In particular, given the operational relationship between Wispak and Emmpak and even apparent confusion at Wispak, the commission finds no fault on behalf of the employee for initially reporting Wispak as his employer. The Division was also not at fault in the erroneous payment of benefits, based upon the incorrect information provided by Wispak.

Depending upon whether the benefits were erroneously paid due to fault by "the employer" or "an employer" Wis. Stats. § 108.04(13)(c) imposes different consequences upon an employee who is without fault in the erroneous payment of benefits. If the at issue employer is at fault in the erroneous payment and the employee is without fault, the benefits will be referred to as erroneously paid but will "stand as paid" with no overpayment for the employee to repay. On the other hand, if the at issue employer is not at fault but a different employer is at fault, an overpayment will be created and the employee is responsible for repaying the overpayment pursuant to Wis. Stat. § 108.22(8)(c) even though the employee is without fault. Further, under the latter scenario, the "at fault" employer, will be charged for the benefits erroneously paid and will not be credited those amounts if department recovers the overpayment. See Wis. Stat. § 108.04(13)(e).

Emmpak's representative testified that Wispak and Emmpak are related divisions, with one owning the other and sharing at least one location. Given Wispak's initial information to the department about the employee's actual start date, it is obvious that the businesses also share employment records. Under these rare circumstances, the commission attributes the Wispak fault to Emmpak. As such, while the erroneously paid benefits were not paid due to any fault on behalf the employee, the benefits were not paid "without fault" of Emmpak and the erroneously paid benefits will "stand as paid." No overpayment will be created.

The commission therefore finds that in week 46 of 2002, the employee was not discharged within the meaning of Wis. Stat. § 108.04(5). The commission further finds that in week 46 of 2002, the employee voluntarily terminated his employment and not within any of the exceptions to Wis. Stat. § 108.04(7)(a) but that as of week 50 of 2003, at least four weeks had elapsed since the end of the quitting and the employee earned wages equaling at least four times his weekly benefit rate which would have been paid had the quitting not occurred. The commission finally finds that the erroneously paid benefits totaling $2,052.00 will stand as paid because the employer failed to question the employee's eligibility on a required report and failed to file an objection to his benefit claim, within the meaning of Wis. Stat. § 108.04(13).

DECISION

The appeal tribunal decision is modified to conform with the above findings and as modified it affirmed in part and reversed in part. Accordingly, the employee is ineligible for benefits in weeks 46 of 2002 until week 50 of 2003. He is eligible for benefits beginning in week 50 of 2003, if otherwise qualified. As the $2,052.00 in benefits paid to the employee were paid due to employer fault and without fault on behalf of the employee, those benefits will stand as paid and no overpayment is created. Finally, benefits paid to the employee in error will remain charged to the employer's account.

Dated and mailed December 3, 2004
pittmke . urr : 150 : 1    BR 319.1

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner

 

NOTE: The commission's reversal is not based upon a differing credibility assessment from that made by the administrative law judge; rather, it is due to additional evidence adduced at the remand hearing and because the commission reached a different legal conclusion regarding the separation when it applied the law to the facts found by the ALJ

 

cc: Emmpak Foods, Inc. (Butler, Wisconsin)


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