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

DEBRA J DORN, Claimant

TRADE ACT DECISION
Hearing No. 06000165FL


An administrative law judge (ALJ) for the Division of Unemployment Insurance of the Department of Workforce Development issued a decision in this matter on February 23, 2006. A timely petition for review was filed from this decision.

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

On November 4, 2005, a department adjudicator issued a determination (ID No. 050481791) finding the claimant ineligible for TRA benefits. The rationale for this determination was that the claimant failed to enroll in full-time approved training or to receive a training waiver within the 16th week of her most recent qualifying separation or the last day of the 8th week after the certification date.

The claimant filed a timely request for hearing, and the matter went to hearing before ALJ James H. Moe, acting as an appeal tribunal for the department, on December 5, 2005. On December 9, 2005, ALJ Moe issued an Appeal Tribunal Decision (Hrg. No. 05005048FL) which stated, in relevant part, as follows:

The Trade Act has long required a claimant to enroll in approved training, to have completed such training, or to obtain a waiver of the training requirement, as a condition for receiving weekly TRA payments. See, U.S.C. § 2291(a)(5).

The 2002 amendments added a "16/8-week deadline" to the "enrolled in" option of this provision by requiring that enrollment in training must occur by the 16th week after the claimant's separation from work or the 8th week after the certification of the employer, or certain other defined dates. The United States Department of Labor has interpreted these provisions to require workers granted training waivers to obtain them within the 16/8 week deadline. The Wisconsin department has followed that interpretation, and applied it to disqualify the claimant's TRA claim in this case. Accordingly, the issue is whether the claimant's failure to obtain a training waiver before the 16/8-week deadline disqualifies her from receiving weekly TRA benefits.

In recent decisions, [citing Christine L. Tracy, Hrg. No. 0460411MW (LIRC, January 27, 2005)] currently under judicial appeal by the department, the Labor and Industry Review Commission has ruled that the 16/8 week deadline does not apply to TRA training waivers. Under LIRC's rulings, a claimant who first obtains a waiver after that deadline is not disqualified provided that waiver is appropriate under the applicable statutory criteria. While those decisions are not binding on the appeal tribunal, their reasoning is persuasive.

The appeal tribunal therefore finds that the claimant was not required by 19 U.S.C. § 2291(a)(5)(c) to obtain a training wavier within 16 weeks of her separation from adversely affected employment in week 15 of 2005.

The DECISION paragraph of ALJ Moe's decision contained the following mandate:

The department's determination is reversed. This matter is remanded to the department to determine the claimant's eligibility for weekly Trade Readjustment Allowance and the Health Insurance Tax Credit consistent with this decision.

This Appeal Tribunal Decision having been issued on December 9, 2005, the last day on which a timely petition for commission review could be filed from it was December 30, 2005. Wis. Stat. § 108.09(6). The department had authority under the statutes to file a petition for review from this decision. Id. However, no petition for review was filed. Instead, on December 30, 2005, the department issued another determination (ID No. 050206200). This new determination stated:

The decision dated 11/04/05 is set aside and reissued due to subsequent information.

Upon remand of an Appeal Tribunal Decision dated 12/9/05 the department makes the following determination.

The claimant failed to enroll in full-time approved training or to receive a training waiver within the 16th week of her most-recent "qualifying" separation or the last day of the 8th week after the certification date.

She was mailed an appointment notice to her current address for a meeting held on 06/22/05. She did not attend the meeting because she states she did not receive that appointment notice.

Effect: The claimant is not eligible for weekly trade readjustment allowances (TRA) or the Health Coverage Tax Credit (HCTC). The claimant is eligible to apply for training, relocation or job search assistance.

Petition No. TA-W-56980
Adversely Affected Employer: Tecumseh Power

Note: The LIRC decision relied upon for the set aside of the department's original decision of November 4, 2005 has been reversed by a higher authority. Therefore, the department issues this new decision denying TRA benefits on the same grounds as that original decision. Legal authority: Governor-secretary agreement of January 16, 2005, TEGL 11-02, TEGL 11-02, change 1 and DWD v. LIRC, et al. Case No. 05-CV-574, Dane County Circuit Court (Bench decision December 15, 2005).

Except for the first two paragraphs describing the asserted authority for the determination, and the closing "Note" explaining its rationale, this determination was virtually identical to the one which ALJ Moe had reversed.

The claimant filed a timely request for hearing from this December 30, 2005 determination, and the matter went to hearing before ALJ Raymond S. Bradley, acting as an appeal tribunal for the department, on February 21, 2006. On February 23, 2006, Bradley issued an Appeal Tribunal Decision (Hrg. No. 06000165FL) which affirmed the December 30, 2005 determination. The claimant filed a timely petition for commission review from this decision.

For the reasons described below, the commission concludes that the department acted in excess of its legal authority in issuing the December 30, 2005 determination which was affirmed by ALJ Bradley's Appeal Tribunal Decision. 
 

Discussion -- The determination issued on December 30, 2005 set forth two different sources of authority under which it was supposedly being issued.

Initially, the December 30, 2005 determination purported to "set aside" the November 5, 2005 determination "based on subsequent information." This was an evident attempt to invoke the department's authority in Wis. Stat. § 108.09(2)(c) to set aside department determinations "on the basis of subsequent information or to correct a mistake." However, under § 108.09(2)(c), the department's authority to set aside a previous determination is prefaced with the reservation, "Unless a party has filed a timely request for hearing as to the determination." That was in fact the case here; a timely request for hearing had been filed from the November 4, 2005 determination, on November 10, 2005. As of that point, the department no longer had any authority to set aside the determination (which had in any event already been reversed by ALJ Moe). This first claim as to the authority under which the determination was issued therefore fails.

Next, the December 30, 2005 determination stated that it was made "upon remand of an Appeal Tribunal Decision dated 12/9/05." This was an evident attempt to characterize the determination as one authorized by the December 9, 2005 Appeal Tribunal Decision issued by ALJ Moe. This second claim as to the authority under which the determination was issued also fails, for the following reasons.

ALJ Moe's Appeal Tribunal Decision had clearly adopted an interpretation of the federal Trade Act to the effect that the "16/8-week deadline" found in 19 U.S.C. § 2291(a)(5)(A) did not apply to the granting of training waivers. His decision reflected his agreement with the reasoning in decisions by the commission on this issue, including Christine L. Tracy, (LIRC, January 27, 2005), in which the commission had set aside determinations finding claimants ineligible based on the 16/8-week deadline and remanded to the department for it to issue new determinations as to whether the claimants were entitled to waivers of the training requirement under the standards described in 19 U.S.C § 2291(c). On this basis, ALJ Moe expressly reversed the November 4, 2005 determination, and he expressly remanded the matter to the department for it to determine the claimant's eligibility "consistent with this decision." However, the department's December 30, 2005 determination was identical in substance to the determination which ALJ Moe had reversed and was plainly inconsistent with ALJ Moe's decision.

Documents in the file make it clear that the department's December 30, 2005 determination was not the result of any sort of misunderstanding about the substance or effect of ALJ Moe's Appeal Tribunal Decision, but instead reflected an intentional choice by the department, arrived at with the involvement of its Bureau of Legal Affairs, to effectively disregard that decision.

This situation presents an issue as to whether and to what extent the department is legally bound by decisions of its own appeal tribunals.

The UI Act provides for the establishment of appeal tribunals to hear "and decide" disputed claims. Wis. Stat. § 108.09(3)(a). The Act also provides that on an appeal from an initial determination of the department, "[t]he appeal tribunal may affirm, reverse or modify the initial determination of the department or set aside the determination and remand the matter to the department for further proceedings, or may remand to the department for consideration of any issue not previously investigated by the department." Wis. Stat. § 108.09(3)(b). The Act also provides that disputed claims "shall be promptly decided" by the designated appeal tribunal. Wis. Stat. § 108.09(4)(a). Of particular significance to the issue presented here, is the fact that the Act also provides that the department has the right to petition for review of an appeal tribunal decision. Wis. Stat. § 108.09(6)(a).

It is implicit in these provisions that if the department does not exercise its right to petition for review of an appeal tribunal decision, that decision is binding on the department and it must accept and comply with it. If this were not the case -- that is, if the department could simply choose not to follow decisions issued by appeal tribunals -- then the statutory provisions stating that appeal tribunals were to "decide" disputed claims and could "affirm, reverse or modify...or set aside...and remand...or further proceedings" the department's determinations, would have no practical effect. In addition, the creation of the department's right to petition for commission review of appeal tribunal decisions would not have been necessary, and thus presumably would not have occurred, if appeal tribunal decisions had not been understood to be binding on the department.

The conclusion that appeal tribunal decisions are binding on the department if not appealed is also suggested by Wis. Stat. § 108.10(6), which sets out express qualifications on the extent to which appeal tribunal decisions concerning status and contribution liability issues are binding on the department. The absence of any similar qualifications within Wis. Stat. § 108.09, which applies to benefit claims, supports the conclusion that under that section, appeal tribunal decisions are fully binding on the department unless appealed.

The conclusion that appeal tribunal decisions are binding on the department if not appealed is also consistent with the general legal doctrines that apply to the relationships between higher and lower judicial tribunals. A good description of these doctrines can be found in Burch v. American Family Mut. Ins. Co., 198 Wis. 2d 465, 543 N.W.2d 277 (1996), in which the court said:

A question of law decided by an appellate court on initial appeal becomes the law of the case on remand. Johnson v. Industrial Commission, 14 Wis. 2d 211, 217, 109 N.W.2d 666 (1961). This court has previously recognized, however, that the binding effect of an appellate ruling is not absolute. For example, the law of the case may be disregarded when 'cogent, substantial and proper reasons exist' such as a subsequent contrary decision from a controlling authority. Mullen v. Coolong, 153 Wis. 2d 401, 410-411, 451 N.W.2d 412 (1990) (quoting Univest Corp. v. General Split Corp., 148 Wis. 2d 29, 39, 435 N.W.2d 234 (1989)). Here, the court of appeals remanded with an explicit directive that the question of whether or not Amy was mentally capable of negligence must be put to the jury. Burch I, 171 Wis. 2d at 615-16. Although today we overrule that holding, the circuit court in this instance should have applied the Burch I rationale on retrial. A trial judge may not simply reject instructions on remand because he disagrees with the appellate court's legal analysis. The circuit court's conclusion that the court of appeals' decision 'overreaches and is not well-founded' on standing case law does not constitute a proper reason to disregard the law of the case doctrine.

Burch, 198 Wis. 2d at 470, n.1. The salient principle recognized here is that a lower tribunal may not simply reject instructions on remand because it disagrees with the higher tribunal's legal analysis.

It is true that an exception is recognized to the "law of the case" doctrine for situations in which a subsequent contrary decision may warrant the lower tribunal in declining to follow an instruction from a higher tribunal which had been premised on previous and no-longer-applicable authority. However, this exception involves subsequent contrary decisions "from a controlling authority." In this case, the subsequent decision which the department looked to as justification for refusing to follow ALJ Moe's mandate, was one issued by the Dane County Circuit Court in a case involving other TRA claims. That decision was not "controlling." A circuit court decision is not binding precedent or authority. Kuhn v. Allstate, 181 Wis. 2d 453, 468, 510 N.W.2d 826 (Ct. App. 1993), Brandt v. LIRC, 160 Wis. 2d 353, 365, 466 N.W.2d 673 (Ct. App. 1991).

The best possible construction which can be put upon the department's wilful refusal to accept and comply with ALJ Moe's decision, is that the department followed the theory that ALJ Moe decided the case as he did because he considered himself bound to follow LIRC's decisions, and that once LIRC's decisions were reversed by the circuit court the basis for ALJ Moe's decision disappeared, so that it became permissible for the department to ignore his decision and do the opposite of what he had decided. However, this theory is insupportable. ALJ Moe did not render his decision because he felt himself bound to do so by LIRC's decisions. On the contrary, ALJ Moe voiced the opinion that LIRC's decisions were not binding on him. What he said, with reference to LIRC's decisions, was that he found their reasoning persuasive. In other words, ALJ Moe ruled the way he did because he disagreed with the department's interpretation of the 16/8-week deadline and agreed with LIRC's interpretation. The fact that the Dane County Circuit Court took a different view in the case pending before it which raised that issue, did not change the fact that that had been ALJ Moe's rationale. It therefore gave the department no basis for refusing to follow his ruling.

The department may have considered that after the Dane County Circuit Court decision was issued, the LIRC decisions which it set aside should no longer have been considered persuasive. However, it is not for the department to conclude that because of developments occurring after an ALJ has issued a decision, the decision should be unilaterally changed or set aside. That authority resides with the ALJ, under Wis. Stat. § 108.09(3)(f), which provides that the appeal tribunal may on its own motion amend or set aside its own decision within 21 days of its issuance. If the department believed that the Dane County Circuit Court's bench ruling warranted a change in ALJ Moe's Appeal Tribunal Decision, it had the option to bring the matter to his attention and ask him to exercise his authority to set aside and reconsider that decision, and it had ample time within which to exercise that option. It did not have legal authority under the Act, however, to arrogate to itself the ALJ's authority to set aside his decision for that reason. 
 

Conclusion -- Based on his agreement with a particular interpretation of the relevant provisions of the Trade Act, ALJ Moe issued an Appeal Tribunal Decision which reversed the first determination issued in this case and which instructed the department to issue another determination "consistent with" his decision. The department's options with respect to an Appeal Tribunal Decision are to either appeal it, or follow it. It must do one or the other. Having failed to exercise its right to appeal ALJ Moe's decision here, the department was bound by it and was required to follow it. The department thus had no legal authority to ignore the mandate of ALJ Moe's decision and to instead issue another determination inconsistent with ALJ Moe's decision and identical to the previous determination which he had expressly reversed. Because the department had no legal authority to issue the subsequent determination which did this, that determination should not have been affirmed by ALJ Bradley when it was before him on appeal.

Based on the foregoing, and pursuant to its authority under Wis. Stat. § 108.09(6)(d), the commission makes the following:

DECISION

The February 23, 2006 decision of ALJ Bradley (Hrg. No. 06000165FL) is set aside. The December 30, 2005 determination (ID No. 050206200) is set aside. The December 9, 2005 decision of ALJ Moe (Hrg. No. 05005048FL) remains in effect. This matter is remanded to the department to determine the claimant's eligibility for weekly Trade Readjustment Allowance and Health Insurance Tax Credits consistent with the December 9, 2005 decision of ALJ Moe.

Dated and mailed May 16, 2006
dorndeb . trr : 110 : 4   PC 715   TRA

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner

cc: Attorney Sue Maisa


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