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

RUTH A TICKLER, Employee

THE PROCTER/GAMBLE PAPER PRODUCTS CO, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 05400696GB


On February 23, 2005, the Department of Workforce Development issued an initial determination which held that the employee's quit was not for a reason allowing for immediate eligibility for unemployment insurance. The employee filed a timely request for hearing on the adverse determination, and hearing was held on March 29, 2005 in Green Bay, Wisconsin before a department administrative law judge. On March 31, 2005, the administrative law judge issued an appeal tribunal decision affirming the initial determination. The employee filed a timely petition for commission review of the adverse decision, and the matter now is ready for disposition.

Based upon the applicable law and the records and other evidence in the case, the commission issues the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The employee worked 14 1/2 years as a technician for the employer, a paper product manufacturer. Her last day of work was February 1, 2005 (week 6), when her employment ended pursuant to an early retirement package she accepted, and the issue is whether the separation from employment falls within Wis. Stat.
§ 108.04(7)(am). The commission concludes that it does, and so reverses the appeal tribunal decision.

The employee worked at the employer's East River Plant in Green Bay. The employer moved the product manufactured at the plant to a plant in Canada. This resulted in the employer's decision to close the East River Plant. Employees at the East River Plant were given two options: 1. transfer to the employer's other nearby facility, its Fox River Plant; or 2. take a separation package offered by the employer. At a meeting of workers affected by the plant closing, the employer told the group including the employee that, if an insufficient number of employees did not take the separation package, the employer would have to institute layoffs. Written materials the employer distributed about the offer also stated that the purpose of the program was to achieve what the employer referred to as "staffing targets." An employer representative also had told the employees they would be eligible for unemployment insurance (after the end of the time period for which their severance pay had been allocated), TAA, and TRA. In addition to this verbal assurance, the employer provided the employees with a written document stating that employees would be eligible for 26 weeks of unemployment insurance and that, within certain time constraints, they would also be eligible for TAA and TRA. On May 24, 2004, the employee accepted the separation package offered by the employer and her last day of work, pursuant to the agreement, was February 1, 2005 (week 6).

The employee could have remained employed had she not accepted the employer's early retirement offer. The separation from employment thus was a quit by the employee. Generally, pursuant to Wis. Stat. § 108.04(7)(a), a quit of employment is disqualifying for unemployment insurance purposes. One exception to this general disqualification is Wis. Stat. § 108.04(7)(am), which provides:

(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.

The employer was closing the plant the employee worked at. Its staffing targets were due to the plant closing. In addition the employer, through supervisory personnel conducting the informational meetings regarding the separation package, specifically informed employees that the employer would institute layoffs if an insufficient number of employees took the separation package. At the same time, the employer controlled the number of separation packages it agreed to, because of employer concerns that too many people would take the package and cause the employer to suffer a business hardship. In other words, the employer was only allowing individuals to take a separation package who were "expendable" as a result of the closing of the plant. Given these factors, the most reasonable inference is that the employer's acceptance of the employee's separation package application avoided the necessity of the employer's having to lay off a co-worker of the employee. This brings the employee's quit within Wis. Stat. § 108.04(7)(am).

The commission therefore finds that, in week 6 of 2005, the employee terminated her employment in lieu of the termination by the employer of another employee's work, within the meaning of Wis. Stat. § 108.04(7)(am).


DECISION

The appeal tribunal decision is reversed. Accordingly, the employee is eligible for unemployment insurance beginning in week 6 of 2005, if she is otherwise qualified.

Dated and mailed August 17, 2005
ticklru . urr : 105 : 4    VL 1007.01

/s/ James T. Flynn, Chairman

/s/ Robert Glaser, Commissioner

NOTE: The commission did not confer with the administrative law judge before determining to reverse the appeal tribunal decision in this case. The commission's reversal is not based upon a differing credibility assessment from that made by the administrative law judge. Moreover, the majority of the commission believes the facts of this case are distinguishable from the legal precedent on this issue, Barry v. LIRC, 213 Wis. 2d 397, 570 N.W.2d 610 (Ct. App. 1997). In Barry, it was uncertain whether any layoffs would necessarily occur, even if no employees took the separation packages offered by the employer in that case. By contrast, in the present case the evidence establishes that employees would have been laid off had a sufficient number of employees (including the employee) not taken the separation packages offered by the employer. What distinguishes the present case from Barry is the fact that this was a plant closing in which there is no question but that the employees of the plant were losing their jobs. It thus is not the case here, as it was in Barry, that the claimants accepted the separation packages without knowing whether any of them would be involuntarily suspended or terminated. Barry, 213 Wis. 2d at 404.

 

DAVID B. FALSTAD, Commissioner, (dissenting):

I respectfully dissent from the majority opinion in this case, for the following reasons. First, the employee could not point to a specific employee or specific group of employees who would remain employed because the employee took the early retirement package. The separation thus does not meet the legal requirements enunciated in Barry v. LIRC, 213 Wis. 2d 397, 570 N.W.2d 610 (Ct. App. 1997). In addition, the employer's human resource manager's unrebutted testimony was that no one would have been laid off had the employee not accepted the early retirement package. Even the employee could testify only that she thought "there would probably" be people laid off if enough workers did not take the early retirement offers. Nor is this surprising. Despite the plant's closing, there were several mechanisms which might have avoided the necessity of layoffs. There was an adjacent plant for affected workers to transfer to. There also would be separations by workers for reasons unrelated to the plant closing. Second, the time frame for the early retirement packages was too broad for application of Wis. Stat. § 108.04(7)(am). The early retirement package in question was offered to the group of workers including the employee, in January of 2004. Employees could accept the offer and then leave the employer as late as June 30, 2005. For these reasons, it is speculative to assert that the employee's acceptance of the early retirement package allowed the employer to avoid laying off a co-worker. The employee's quit thus cannot be considered to fall within Wis. Stat. § 108.04(7)(am).

/s/ David B. Falstad, Commissioner

 

cc: Procter & Gamble (Green Bay, Wisconsin)


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