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

JAMIE L KING, Employee

DE RIAH LTD, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 06601843WB


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 6 of 2006, and until four weeks have elapsed since the end of the week of quitting and the employee has earned wages in covered employment performed after the week of quitting equaling at least four times the employee's weekly benefit rate which would have been paid had the quitting not occurred.

Dated and mailed September 15, 2006
kingja . usd : 145 : 2  VL 1005  VL 1080.05

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner


MEMORANDUM OPINION

The employee, in her petition for commission review, asserts that her co-worker, in exactly the same circumstances, was awarded benefits because she, like the employee, refused to sign a non-compete agreement. The employee further asserts that the non-compete agreement in question did not give a territorial boundary though it did have a time limit of 18 months during which the employee was not to contact her clients. The employee mischaracterizes the agreement. The commission notes that for 18 months the employee was not to perform cosmetology services for her former clients, not that she could not have any contact with them. At any rate, Farm Credit Services v. Wysocki, 243 Wis. 2d 305 (2001), held that a customer list limitation served the same purpose as a geographical limitation but that it was more specifically tailored to address the employer's concerns. In this case, the employee would have been able to work in the cosmetology field in a shop close in physical proximity to that of the employer, she simply would not have been able to perform services for her former clients. In addition, as pointed out by the ALJ, at the time the employer requested that she sign such agreement, she was already working under an agreement that was similar, if somewhat more restrictive. Further, the employee was offered monetary consideration in exchange for signing the new agreement. As such, the commission agrees with the ALJ's conclusion that the non-compete agreement did not provide the employee with good cause attributable to the employer for quitting her job.

With respect to the employee's co-worker, the commission does not have the record before it. However, the commission has read and considered the appeal tribunal decision in that case. The commission does not agree with the ALJ's conclusion that the non-compete agreement was deficient for lack of a territorial limit, given its limitation as to specific customers. Further, in that case, according to the findings in the decision, the employer offered to revise the agreement but that worker refused because she intended to start her own business. That worker, at the very least, should have discussed modifications to the contract with the employer prior to quitting. However, the employer has not petitioned that decision. In addition, department records reflect that the worker in that case only filed for benefits from weeks 6 of 2006, through week 10 of 2006, and was disqualified on a different basis. As such the worker in the other case did not receive benefits. Therefore the commission will take no further action with respect to that decision.

cc: Attorney Jennifer Schober Goodwin


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uploaded 2006/09/18