CHARLES G. HALE, Claimant
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:
The claimant filed claims for and received Wisconsin unemployment insurance (UI) benefits for a number of weeks in 2004. He last filed a claim for UI benefits for week 51 of 2004 (the week ending December 18, 2004). Beginning with the following week, week 52 of 2004 (the week ending December 25, 2004), the claimant filed claims for and received Trade Readjustment Allowances (TRA) benefits under the federal Trade Act.
During the time that he was claiming these benefits, the claimant was working part-time and earning wages from such employment, from a number of employers. The department eventually became aware of the discrepancies between what the claimant had reported he had earned in these weekly claims and what his employers had reported he had been paid, and it conducted an investigation. On September 2, 2005 the department issued two related determinations.
One of the determinations found that the claimant concealed work performed and wages earned in weeks 52 of 2004 and weeks 2-3, 5, 8-12, and 14-16 of 2005, for which weeks TRA benefits were paid to the claimant, that the claimant was for this reason ineligible for any further benefits under the Trade Act, and that the decision resulted in an overpayment of $8,442 which the claimant was required to repay. This matter, subsequently assigned Hrg. No. 05403510GB, will be referred to herein as the "eligibility/overpayment" matter.
The other determination found that the claimant had concealed work performed and wages earned in weeks 25-27, 31-34, 36-46, and 49-52 of 2004 and weeks 2-3, 5, 8-12, and 14-16 of 2005. (1) This determination stated that its effect was that the claimant was required to forfeit $5,264 of unemployment compensation benefits that become payable during the six year period ending August 6, 2011. This matter, subsequently assigned Hrg. No. 05403611GB, will be referred to herein as the "concealment/forfeiture" matter.
The claimant filed timely appeals from both of these determinations. Pursuant to notice, an ALJ acting as an Appeal Tribunal for the department conducted a hearing on these appeals on January 23, 2006. (2) The ALJ subsequently issued two Appeal Tribunal Decisions, affirming the department's determinations. The claimant filed timely petitions for commission review of these Appeal Tribunal Decisions.
In this decision, the commission addresses the petition for review of the
decision in Hrg. No. 05403510GB, the "eligibility/overpayment" decision.
(3)
Discussion -- The claimant did not dispute the evidence in the record concerning the weeks in which he filed claims, the amounts he reported in his claims as having earned, and the amounts he in fact earned in those weeks. That evidence establishes, and it is hereby found, that the claimant filed TRA claims reporting less in earnings than he had actually earned for the week, for week 52 of 2004 and weeks 2-3, 8-12, and 14-16 of 2005. (4) In several of these weeks the claimant reported no earnings, and in the other weeks he reported weekly earnings of $30 or $45, when in all such weeks he had in fact earned significantly more than he reported.
In the separate decision issued this date in Hrg. No. 05403511GB, the "concealment/forfeiture" matter involving this claimant, the commission found that because in his claim for week 52 of 2004 the claimant knowingly made a false statement or representation of a material fact and knowingly failed to disclose a material fact and as a result received payments under the Trade Act to which he was not entitled, within the meaning of 19 USC § 2315(b), he was ineligible, as of such week, for any further benefits under the Trade Act.
Because the claimant was ineligible, as of week 52 of 2004, for any further benefits under the Trade Act, he was not entitled to the benefits that he was paid for that week and subsequent weeks pursuant to his claims, and he is liable to repay such amounts, pursuant to 19 U.S.C. § 2315(a)(1). The amount of the TRA benefits thus paid to the claimant to which he was not entitled and which he is liable to repay, is $8,842.
The commission therefore finds that the claimant received TRA benefits for week 52 of 2004 and subsequent weeks, in the total amount of $8,842, for which he was not eligible and to which he was not entitled, within the meaning of and pursuant to 19 U.S.C. § 2315(a)(1), and that the claimant is required to repay that amount to the department.
The decision of the ALJ is modified to conform with the foregoing and, as modified, is affirmed. Accordingly, the claimant is required to repay the sum of $8,842 to the department.
Dated and mailed April 19, 2006
halecha . trr : 110 : 8 TRA PC 729
/s/ James T. Flynn, Chairman
/s/ David B. Falstad, Commissioner
/s/ Robert Glaser, Commissioner
This case involves weeks in which the claimant was claiming benefits under the federal Trade Act, and for which the claimant was paid such benefits but was not entitled to them, creating an overpayment. The Appeal Tribunal Decision took up the question of whether this overpayment could be waived, and in so doing it referred to the overpayment provisions of the Wisconsin UI Act.
However, Wisconsin's UI Act and the federal Trade Act have separate and substantively different provisions concerning both what the standards are for deciding whether repayment of erroneously paid benefits can be waived, and the procedures by which such decisions are to be made. The provisions of Wisconsin's UI Act concerning recovery of UI benefit overpayments have no applicability at all to overpayments of TRA benefits or the question of waiver of such overpayments. Laurie J. Kowalczyk (LIRC, Feb. 28, 2005), Jennifer L. Menke (LIRC, Jan. 11, 2005), J. C. Munoz (LIRC, Aug. 24, 2004). In addition, unlike the system created by Wisconsin law in which decision makers are expected to address and resolve the relevant questions about whether recovery of an overpayment should be waived as a part of any decision which creates such an overpayment, under the Trade Act the question of whether recovery of an overpayment should be waived is to be taken up subsequently and separately, and then only in response to a formal application by a claimant for waiver of an overpayment after it has been determined. See, Laurie J. Kowalczyk, supra.
For the foregoing reasons, this decision is limited to establishing that an overpayment in the amount of $8,842 was created by the payment to the claimant of TRA benefits in that amount for week 52 of 2004 and subsequent weeks when he was not eligible for such benefits as a result of the fact that he had failed to disclose material facts in claiming benefits for week 52 of 2004, and that the claimant must repay this amount to the department
To obtain a determination on whether repayment of this overpayment may be waived, the claimant must file an application for a waiver. An application for waiver form can be obtained by sending a request to Unemployment Compensation Division, TRA Unit, P.O. Box 7965, Madison, WI, 53707.
The standards governing such waivers are described in 19 U.S.C. § 2315(1) and in 20 C.F.R. § 617.55. They provide, in substance, that a waiver may be granted only if (1) the payment was made without fault on the part of the individual to whom the payments were made, and (2) requiring such repayment would be "contrary to equity and good conscience," a standard more particularly described in the Code of Federal Regulations provision cited.
While an actual determination on whether a waiver can be granted cannot be made unless and until the claimant files an application for such a waiver, it seems only fair to note for the claimant's sake that, given that the overpayment arose because he had made a false statement of material fact and failed to disclose material facts in claiming benefits, making him ineligible from that point on, it is difficult to see how the "without fault on the part of such individual" condition could be found to have been satisfied here.
NOTE: In the course of conducting its review in this case, the commission noted evidence in the file that the ALJ, after having heard the case but before having decided it, initiated an e-mail contact with an employee of the department concerning the case. Specifically, the ALJ sent an e-mail to a department employee employed as a Disputed Claims Leadworker in the Adjudication Unit of the DWD UI Division's Benefits Operations Administration Bureau. The ALJ's e-mail asked for an explanation of why the overpayment which had been determined ($8,442) exceeded the amount which would result from simply figuring the reduced benefit rate that would be appropriate given the actual partial wages earned. The department employee replied by e-mail, explaining that the overpayment reflected the total ineligibility for further benefits which the claimant was subject to under the Trade Act. The ALJ then evidently relied on this explanation, incorporating it into his decision.
This was an ex parte contact of the kind addressed by the commission's decision in Julie V. De Bauche (LIRC, Sep. 6, 2002).
An ex parte communication is not reversible error unless the contact was prejudicial to a material degree; such material error occurs when a party not notified of an ex parte communication is prejudiced by the inability to rebut facts presented in the communication and where improper influence upon the decision-making appears with reasonable certainty. De Bauche In the circumstances here, the commission concludes that the ex parte communication was not prejudicial. The ALJ was informed, correctly, of the fact that the overpayment reflected the operation of the provision of the Trade Act making a claimant ineligible for all further benefits if they engage in concealment of material facts which results in payment of benefits for which they are not eligible.
Notwithstanding that the ex parte contact here does not require reversal, the commission wishes to reiterate its holding in De Bauche. It is improper for an ALJ to have ex parte contacts with representatives of the department concerning cases pending before that ALJ. Neither the need of the ALJ for advice in a complex area such as Trade Act adjudication, nor the accuracy of the advice which may end up being provided, justifies such contacts. They should not be occurring.
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