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

MARY J ANDERSON, Employee

DEPARTMENT OF AGRICULTURE, TRADE AND CONSUMER PROTECTION, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 08202407


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 filed a claim for unemployment insurance benefits and her most recent benefit year began on March 7, 2007. She exhausted that claim by receiving benefits through week 35 of 2007 of $355.00 per week.

The employee began working for the Wisconsin Department of Agriculture, Trade & Consumer Protection (the employer) on May 19, 2008. She worked through September 25, 2008 (week 39). On October 9, 2008 (week 41), department records reflect that the employee filed a claim for unemployment insurance benefits via the Internet and reported her layoff from the employer.

On October 10, 2008, department records reflect that the employee was mailed a UCB-736T, a Computation of Unemployment Insurance Benefits form, reflecting no wages in her "new" base period of April 1, 2007 to March 31, 2008.

On October 11, 2008, department records reflect that the employee was mailed another UCB-736T, reflecting only wages of $1,200 in quarter 2 of 2008; the quarter two wages were added as part of her alternate base period. (1)

On October 14, 2008, department records reflect that a EUC-707 was mailed to the claimant notifying her that she was eligible for EUC08 in the amount of $355 per week for maximum payment of $4,615. Those records reflect a EUC08 claim with a payment under EUC08 of $355 that same day for the calendar week ending October 4, 2008 (week 40).

On October 17, 2008, a UCB-719 Urgent Request for Wages was mailed to the employer. The form, received as Exhibit No. 2, reflected wages of $1,200.00 for quarter 2 of 2008 and was blank for quarter 3 of 2008.

The employer returned the UCB-719 wage report changing the quarter 2 wages to $2,400.00 and adding quarter 3 wages of $3,890.00. The employer reported the wages when earned not when paid; this was contrary to the UCB-719 wage report specific direction that wages be reported as paid. Based on the employer's incorrect entries, the employee "had" sufficient wages in her base period to establish a regular unemployment insurance benefit claim and the department computed a benefit year for her; the monetary computation was dated October 23, 2008 with a weekly benefit rate of $155.00.

On October 27, 2008, the department paid the employee unemployment benefit checks for weeks 41 and 42 of 2008 of $155.00 per week. On October 28, 2008 the department paid her $155.00 for week 43.

On October 28, 2008, the employer corrected the UCB-719. On that corrected report, the employer dropped the 2nd quarter wages to $800.00  (2)  and increased the 3rd quarter wages to $4,290.00. The department only entered the increase in the 3rd quarter wages and did not enter the decrease in the 2nd quarter wages. Because the department did not enter in the 2nd quarter decrease, the employee still had sufficient wages for her benefit year and, with the increase in the 3rd quarter wages, her weekly benefit rate increased to $171.00 per week.

On October 31, 2008, supplemental checks were issued for weeks 41 through 43 in the amount of $16.00 per week to bring her weekly benefit rate to $171.00.

On November 7, 2008 (week 44) paid to the employee at $171.00. On that same day, another contact between the employer and the department occurred and the error in not entering the quarter 2 of 2008 wages as $800 was realized. With the decrease in wages in quarter 2, the employee lacked the necessary wages outside the high quarter to establish a benefit year and she was not entitled to the regular unemployment insurance benefits paid to her. Payment of unemployment insurance benefits stopped.

On November 28, 2008, the initial determination was issued finding that the employee did not have sufficient base period wages as of week 41 of 2008 and that she had been overpaid unemployment insurance benefits of $684.00 that she had to repay.

On December 8, 2008, the employee appealed the determination arguing that she should not have to repay the regular unemployment insurance benefits.

On December 18, 2008, when the employee no longer had qualifying wages for a regular unemployment benefits year, the department resumed the claimant's EUC08 claim as of week 41 of 2008. Even though the employee appealed the overpayment issue, the department offset the overpaid regular UI benefits with the EUC08 payments the department determined she was now entitled to. EUC08 was to begin again in week 41 at a rate of $355.00 per week. Department records reflect that $355 for week 41 and $329.00 for week 42 of EUC08 was "withheld" to repay3(3) the overpayment amount with a remaining benefit check in EUC08 of $26.00 for week 42 of 2008. Beginning in week 43, EUC08 began paying out at $355 per week each week.

Following the employee's appeal, a hearing was scheduled noticing the issues of: (1) qualifying base period wages and (2) erroneous payment of unemployment insurance benefits. At the hearing, the department's witness testified that the erroneously weekly payments of $155.00 were paid due to employer fault. There was limited testimony about EUC08 payments made to the employee but no testimony regarding the "interplay" of the payments/programs.

The Appeal Tribunal Decision found that the employee lacked sufficient wages to qualify for a regular unemployment benefit year, but was not required to repay the $155 in benefits paid for weeks 41 through 43 because these benefits were paid solely due to employer fault. It further found that the remaining $219 was paid due to department error and without fault on behalf of the claimant, waiving repayment of this amount. It is unclear whether the Department implemented the appeal tribunal decision; it appears that the EUC08 offset has not been altered.

The department petitioned the appeal tribunal decision, arguing that the department be allowed to recover the $684, presumably as the offset implemented earlier, because (1) the overpayment was not due solely to department error and (2) that if the claimant was allowed to keep the benefits, she would be ineligible for the EUC08 payments. 
 

Issue 1: Are there Qualifying Base Period Wages?

The LID under appeal initially dealt with whether the claimant had sufficient base period wages to qualify for unemployment insurance benefits. The LID found base period wages (4) of:

Quarter 3/07           $0
Quarter 4/07           $0
Quarter 1/08           $0
Quarter 2/08       $800
Quarter 3/08    $4,290

The hearing established that the employee actually had base period wages (5) of

Quarter 3/07           $0
Quarter 4/07           $0
Quarter 1/08           $0
Quarter 2/08    $1,200
Quarter 3/08    $4,290

Given the high quarter wages of $4,290, the employee's weekly benefit rate (WBR) would be $171 and to establish a benefit year, she needs to have four times her WBR outside her high quarter and 35 times her WBR in the base period. See Wis. Stat. § 108.04(4). The employee has four times her WBR ($684) outside the high quarter but does not have 35 times her WBR ($5,985) in her base period. Therefore, she does not qualify for a benefit year.
 

Issue 2: Erroneous Payment of Benefits

Since the employee was paid $684 that she was not entitled to, the next issue is whether she must repay the erroneously paid benefits.

Wis. Stat. § 108.04(13)(c) provides,

(c) If an employer, after notice of a benefit claim, fails to file an objection to the claim under s. 108.09 (1), any benefits allowable under any resulting benefit computation shall, unless the department applies a provision of this chapter to disqualify the claimant, be promptly paid. Except as otherwise provided in this paragraph, any eligibility question in objection to the claim raised by the employer after benefit payments to the claimant are commenced does not affect benefits paid prior to the end of the week in which a determination is issued as to the eligibility question unless the benefits are erroneously paid without fault on the part of the employer. Except as otherwise provided in this paragraph, if an employer fails to provide correct and complete information requested by the department during a fact-finding investigation, but later provides the requested information, benefits paid prior to the end of the week in which a redetermination is issued regarding the matter or, if no redetermination is issued, prior to the end of the week in which an appeal tribunal decision is issued regarding the matter, are not affected by the redetermination or decision, unless the benefits are erroneously paid without fault on the part of the employer as provided in par. (f). If benefits are erroneously paid because the employer and the employee are at fault, the department shall charge the employer for the benefits and proceed to create an overpayment under s. 108.22 (8) (a). If benefits are erroneously paid without fault on the part of the employer, regardless of whether the employee is at fault, the department shall charge the benefits as provided in par. (d), unless par. (e) applies, and proceed to create an overpayment under s. 108.22 (8) (a). If benefits are erroneously paid because an employer is at fault and the department recovers the benefits erroneously paid under s. 108.22 (8), the recovery does not affect benefit charges made under this paragraph.

The benefit payment of $151 per week in weeks 41 through 43 was clearly due to the employer's fault and without department or employee fault. Under the above provision, these benefits totaling $465 should "stand as paid."

Moreover, while the ALJ found that department error interceded creating the additional overpayment of $219, the commission still finds that the benefits were erroneously paid due to employer fault with the benefits "standing as paid." In particular, the original establishment of the benefit year was due to employer's first submission of the incorrect report. While amended report was "corrected" as to quarter 2/2008 wages, the "corrected" amount was still incorrect.

Wis. Stat. § 108.04(13)(f) provides:

If benefits are erroneously paid because the employer fails to file a report required by this chapter, the employer fails to provide correct and complete information on the report, the employer fails to object to the benefit claim under s. 108.09 (1), the employer fails to provide correct and complete information requested by the department during a fact-finding investigation, unless an appeal tribunal, the commission, or a court of competent jurisdiction finds that the employer had good cause for the failure to provide the information, or the employer aids and abets the claimant in an act of concealment as provided in sub. (11), the employer is at fault. If benefits are erroneously paid because an employee commits an act of concealment as provided in sub. (11) or fails to provide correct and complete information to the department, the employee is at fault.
 

Issue 3: Petition request to "allow for recovery of the $684 overpayment."

To support its position, the petitioner cited Wis. Stat. § 108.04(12)(c), PREVENTION OF DUPLICATE PAYMENTS, which provides:

(c) Any individual who receives unemployment insurance for a given week under any federal law through any federal agency shall be ineligible for benefits paid or payable for that same week under this chapter.

Additionally, Wis. Stat. § 108.04(12)(b) provides,

Any individual who receives, through the department, any other type of unemployment benefit or allowance for a given week is ineligible for benefits for that same week under this chapter, except as specifically required for conformity with the federal trade act of 1974 (P.L. 93-618).

§ 4001(b) of the Title 4-Emergency Unemployment Compensation Federal State Agreement, provides that EUC08 can only be paid if (1) a claimant has exhausted all rights to regular unemployment compensation under State Law with respect to a benefit year and (2) the claimant has no rights to regular compensation or extended compensation with respect to a week under such law or any other state unemployment compensation law or to compensation under any other federal law and the exhausted benefit year meets certain timing requirements. (6)

The petitioner argues that the employee cannot be paid the EUC08 if she is allowed to keep the regular unemployment benefits that were erroneously paid to her. Yet, the commission does not have jurisdiction of that issue, it was not noticed for the hearing and no testimony regarding the relationship of the two benefit programs was taken. In addition to not having jurisdiction of the issue, one possible outcome could be a finding that EUC08 was not payable and should be denied. Yet, § 4005(c)(2) of the Title 4-Emergency Unemployment Compensation Federal State Agreement, requires that an individual be issued an appealable determination and opportunity for a fair hearing before repayment is required. See also, UIPL No. 23-08, dated July 7, 2008, Attachment A, Processing Claims for EUC08, 6(3) page A-13. For these reasons, the commission limits its findings to those properly noticed and remands the matter to the department for further action as deemed necessary.

The commission therefore finds:

(1) that as of week 41 of 2008, the claimant lacked the necessary base period wages to establish a benefit year pursuant to Wis. Stat. § 108.04(4), and

(2) the claimant was erroneously paid benefits totaling $684 due to employer fault but not due to claimant fault and therefore benefits will "stand as paid" with the employer charged for the erroneously paid benefits, within the meaning of Wis. Stat. § 108.04(13)(f).

DECISION

The decision of the administrative law judge is modified to conform to the above findings and, as modified, is affirmed. Accordingly, as of week 41 of 2008, the claimant lacked qualifying base period wages to establish a benefit year, was not eligible for unemployment insurance benefits and because the $684 in benefits paid to her were erroneously paid due to fault on behalf the employer but not the claimant, no overpayment will be created, benefits stand as paid, with the employer charged for the erroneously paid benefits. The commission remands the matter to the department for further action as deemed necessary.

Dated and mailed April 23, 2009
anderma . urr : 150 : BR 338

/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 before modifying the findings related to the erroneously paid benefits. The ATD was modified due to reaching a differing legal conclusion regarding employer fault.

 

cc: Daniel J. LaRocque, Bureau of Legal Affairs Director



[ Search UC Decisions ] - [ UC Digest - Main Index ] - [ UC Legal Resources ] - [ LIRC Home Page ]


Footnotes:

(1)( Back ) A claimant's base period is the first four of the five most recently completed calendar quarters preceding the benefit year; however, if a claimant does not qualify to receive benefits based upon that time period, an alternate period of the four most recently completed quarters preceding the benefit year is used. See Wis. Stat. §108.02(4).

(2)( Back ) However, it appears the $800 for the 2nd quarter wages was still incorrect, based upon the employer's witness at the hearing, the amount reported should have been $1,200.

(3)( Back ) States that have a "Cross Program Overpayment Offset" agreement with the Secretary may use EUC08 benefits to recover State unemployment overpayments. See Question 1, § K Overpayments, EUC08 Questions and Answers, Unemployment Insurance Program Letter (UIPL) No. 23-08, Change 1, dated August 15, 2008.

(4)( Back ) This is using the alternate base period.

(5)( Back ) Again, this uses the alternate base period.

(6)( Back ) A third point does not apply as it references receipt of Canadian unemployment insurance benefits.

 


uploaded 2009/05/05