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

JAY A CAPELLE, Employee

BRUNSWICK CORP, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 08002739MD


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:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The employee worked for the employer, a manufacturer of boat motors, for 32 years as a maintenance mechanic. He last performed services for the employer on May 6, 2008 (week 19), and his employment ended on May 28, 2008 (week 22).

On May 2, 2008, the employer learned that the employee had used its copy machine to make approximately 50 two-sided color brochures related to a private business the employee ran outside of work hours. The employer also discovered that the employee had been using the internet for work on his personal business during work time.

The employer's work rules do not address personal photocopies or internet use, but do state that employee theft may result in discharge. The employer considered the employee's actions to be theft.

The employer offered the employee an opportunity to retain his job by signing a last chance agreement. The last chance agreement required the employee to agree that he had engaged in gross misconduct by using company equipment on paid time for personal gain, and that the penalty of discharge would be appropriate. The agreement further stated that, in exchange for being able to keep his job, the employee must relinquish all rights under the collective bargaining agreement and release the employer from any legal claims arising out of his employment or discharge for the next two years. The agreement went on to explain that the employee would be expected to follow all rules and that the employer would have zero tolerance for any wrongdoing regardless of the severity of discipline that would have otherwise been imposed and regardless of whether mitigating circumstances exist. The agreement specified that the employee would be immediately discharged for, among other things, failing to follow any direction given by a supervisor, failing to punch in or out properly, failing to cooperate, failing to pay attention to his assigned duties, being discourteous to anyone, damaging company property, engaging in any off-duty misconduct, loafing, being away from his work area, or for unsatisfactory work performance.

The employee refused to sign the agreement and his employment ended. The issue presented is whether the employee quit or was discharged and whether he is eligible for benefits based upon that separation.

The commission has generally viewed an employee's refusal to sign a last chance agreement, knowing the refusal will end the employment relationship, as a quit. See, Lewis v. Johnson Controls Battery Group, Inc., UI Hearing No. 94606558 (LIRC March 14, 1995); Burton v. Signicast Corp., UI Hearing No. 00603251MW (LIRC Oct. 23, 2000). Here, as in Lewis and Burton, the employee had an opportunity to maintain the employment relationship by signing the last chance agreement but failed to do so. As a result, the separation was a quit.

Under Wis. Stat. § 108.04(7)(a), an employee who voluntarily terminates employment with an employer is ineligible for benefits unless the quitting falls within a statutory exception permitting the immediate payment of benefits. One such exception is Wis. Stat. § 108.04(7)(b), which provides that, if an employee voluntarily terminates employment with good cause attributable to the employing unit, he or she is eligible for the immediate payment of unemployment benefits. "Good cause attributable to the employing unit" means that the employee's resignation is caused by some act or omission by the employer which justifies the employee's decision to quit. It involves some fault on the part of the employer and must be real and substantial. Kessler v. Industrial Comm., 27 Wis. 2d 398, 401, 134 N.W.2d 412 (1965); Hanmer v. DILHR, 92 Wis. 2d 90, 98, 284 N.W.2d 587 (1979).

The employee could have kept his job by agreeing that he had engaged in gross misconduct warranting immediate discharge and that he could now be discharged for any reason and would have no rights as a union member and no legal recourse for the next two years. The employee testified that he preferred unemployment to signing such an agreement, because he believed it gave him no room as an employee. The employee explained that he believed if he went back to work for the employer he would be fired anyway and would have no recourse.

The commission has found that an employee quit with good cause when he refused to sign an unreasonable last chance agreement. See Doyle v. Village of Genoa City Walworth Co., UI Hearing No. 05000685MD (LIRC May 31, 2005). As in Doyle, the commission believes that the last chance agreement in this case was unreasonable and provided the employee with good cause to quit. While the employer may have had a legitimate basis to require the employee to enter into a last chance agreement with respect to not performing personal business on work time or using the employer's resources to further his personal business, the employer was not reasonably justified in requiring the employee to relinquish all avenues of redress for future claims connected with his employment, nor was it reasonable that the employer would retain the right to discharge the employee for any and every violation of rule or policy, including conduct wholly unrelated to the matter for which the employee was placed on the last chance agreement in the first place. In addition, the employer's insertion of the clause indicating that it would discharge the employee without progressive discipline and without regard to mitigating circumstances supports the employee's theory that the employer did not intend to keep him as an employee for long.

Finally, while the appeal tribunal found that the employee failed to explore alternatives short of quitting, the employee testified that he did not think he had the opportunity to request modifications to the agreement, and the commission believes the employee's assessment of the situation was justified. The employer did not suggest that the terms of the agreement were subject to negotiation.

The commission, therefore, finds that in week 22 of 2008, the employee voluntarily terminated his work with the employer, and that his quitting was with good cause attributable to the employer, within the meaning of Wis. Stat. § 108.04(7)(b).

DECISION

The decision of the administrative law judge is reversed. Accordingly, the employee is eligible for benefits beginning in week 22 of 2008, provided he is otherwise qualified. There is no overpayment as a result of this decision.

Dated and mailed November 26, 2008
capelja . urr : 164 : 9 VL 1007  VL 1014

/s/ James T. Flynn, Chairperson

/s/ Robert Glaser, Commissioner

/s/ Ann L. Crump, Commissioner

 

NOTE: The commission did not confer with the administrative law judge about witness credibility and demeanor. The commission's reversal is not based upon a differing assessment of witness credibility.

cc: Attorney Michael J. Kuborn


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