DONALD O OLSON, Employee

WEST BUSINESS SERVICES LP, Employer

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 employee worked just over two years, most recently as a sales associate for the employer, a business-to-business center. His last day of work was on November 10, 2008 (week 46).

On September 18, 2006, the employee filled out an application with the employer. He reported that he had not been convicted of any felonies. He reported that he had been convicted of a misdemeanor for obstructing an officer. He reported that he had not been convicted of a crime of breach of trust or fraud.

The employee was transferring to a position with a different client. The client required a background check. The background check indicated that the employee had pled guilty to a Felony C of "Theft-False Representation-$2,500." The disposition date was February 13, 2006. The status was open and the disposition was listed as "Deferred Prosecution or Sentence."

On November 10, the employee was informed that he was discharged for falsifying his application.

The first issue to be decided is whether the employee's actions, which led to the discharge by the employer, constitute misconduct connected with the employment.

In Boynton Cab Co. v. Neubeck & Ind. Comm., 237 Wis. 249, 296 N.W. 636 (1941), the leading case with respect to the meaning of the term "misconduct" as applied to unemployment insurance in the United States, the court said, in part, as follows:

" . . . the intended meaning of the term 'misconduct' . . . is limited to conduct evincing such wilful or wanton disregard of an employer's interests as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect of his employee, or in carelessness or negligence of such degree or recurrence as to manifest equal culpability, wrongful intent or evil design, or to show an intentional and substantial disregard of the employer's interests or of the employee's duties and obligations to his employer. On the other hand mere inefficiency, unsatisfactory conduct, failure in good performance as the result of inability or incapacity, inadvertencies or ordinary negligence in isolated instances, or good-faith errors in judgment or discretion are not to be deemed 'misconduct' within the meaning of the statute."

The employee argued that he was discharged but not for misconduct. The commission agrees. The employee did not falsify his application as he was never convicted of a felony.

The employer's only witness testified throughout the hearing that the employee was discharged because he falsely answered an employment application question about felony convictions. This witness stated that its private investigator report (Exhibit No. 3) showed that the employee "did in fact have a felony conviction." (Synopsis p. 4) The employee denied ever having been convicted of a felony and the employer failed to introduce any non-hearsay evidence to the contrary. Indeed, the employer's only evidence on this point was the hearsay report of its private investigator. Even that report clearly shows that the employee has not had any felony convictions.

Perhaps recognizing the employer's failure, the ALJ found that the employee misrepresented an answer to a different employment application question, one to which the employer had not attached any importance in making its discharge decision--To wit: "Have you ever been subject to probation, parole or deferred adjudication?" The employee answered this question, "Yes the above issue," presumably referencing his affirmative answer to still another question about misdemeanor convictions. We do not know whether the employee meant that he had been the subject of probation or a "deferred adjudication" or even if the employee understood what was meant by a "deferred adjudication." The ALJ never asked the employee about his answer to this part of the employment application.

The ALJ did ask the employee to look at Exhibit No. 3 and explain his guilty plea to the felony charges described therein. The employee agreed that he pleaded guilty to the felony described in the report, but explained to the ALJ that the report describes the matter as "deferred" and that its status is "open." The employee was not asked if the matter was still pending in court awaiting an "adjudication," or whether the charges were dismissed without prejudice subject to being reissued, or whether prosecution was deferred or what exactly the circumstances of the matter being "deferred" or "open" were as described in the hearsay report.

Based upon this record it is clear that the employee honestly answered the employer's question about felony convictions. It is equally clear that the employer assumed that the employee had felony convictions about which he lied and this was the sole basis for the employer's decision to discharge the employee. The employer never testified that the employee would have been discharged for a deceptive answer to the probation or "deferred adjudication" question. Even if it had, there is no evidence that the employee intended any deception in answering this question. As established long ago in Boynton Cab Co. v. Neubeck & Ind. Comm., 237 Wis. 249 (1941), to prove misconduct the employer has the burden to show that the employee conduct manifested an intentional and substantial disregard of the employer's interests. In this case the employer failed to prove such intent, and given the law's presumption of qualification for unemployment benefits, it is not our duty to go in search of reasons for disqualification. That is the employer's burden.

The commission therefore finds that in week 46 of 2008, the employee was discharged but not for misconduct connected with his work for the employer, within the meaning of Wis. Stat. § 18.04(5).

The decision of the administrative law judge is reversed. Accordingly, the employee is eligible for benefits beginning in week 46 of 2008, if otherwise qualified.

Dated and mailed March 12, 2009
olsondo . urr : 145 : 1 MC 630.09

/s/ James T. Flynn, Chairperson

/s/ Robert Glaser, Commissioner

/s/ Ann L. Crump, Commissioner

The commission did not discuss witness credibility and demeanor with the ALJ who held the hearing. The ALJ did not reverse the ALJ's decision based on a different impression of witness credibility and demeanor. Rather, the commission reversed the ALJ's decision because it reached a different legal conclusion based on the facts found by the ALJ.

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