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

JAMES R LOHMAN, Employee

BOU-MATIC LLC, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 09002536LX


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 claimant is ineligible for benefits beginning in week 16 of 2009, and until he becomes able and available for suitable full-time work.

Dated and mailed October 8, 2009
lohmaja . usd : 115 : 6   AA 265  AA 285

/s/ James T. Flynn, Chairperson

/s/ Robert Glaser, Commissioner

/s/ Ann L. Crump, Commissioner


MEMORANDUM OPINION


The claimant worked 1.5 years as the director of marketing for the employer, a dairy equipment manufacturer. He was laid off on December 28, 2008. The claimant initiated a claim for benefits on April 14, 2009, after he was no longer receiving severance compensation.

The claimant formed his own dairy consulting business on April 15, 2009. The claimant invested $20,000 to start this business.

The claimant works 12 hours a day performing work for his business, and, as of the date of hearing (June 3, 2009) was performing work for two clients.

Exhibit #2 consists of a list of the claimant's associates in the dairy industry whom he has been contacting regularly since his layoff. It is not clear from the record whether he has been contacting them to seek a staff position in their companies or to seek work for his business. See, Fischer v. Safe Harbor Group LLC, UI Hearing No. 98001957JV (LIRC Feb. 16, 1999)(to be eligible for benefits, the work a claimant is seeking must be work as an employee, not work for the claimant's business).

The claimant testified that the lowest salary he would accept is $85,000, and that he is not seeking work outside the dairy equipment industry.

Wisconsin Statutes § 108.04 states as follows, as relevant here:

(2) General qualifying requirements.

(a) Except as provided in par. (b) and as otherwise expressly provided, a claimant is eligible for benefits as to any given week for which he or she earns no wages only if:

1. The individual is able to work and available for work during that week;

2. As of that week, the individual has registered for work; and

3. The individual conducts a reasonable search for suitable work during that week....

(8) Suitable work.

...(d) An employee shall have good cause under par. (a) or (c), regardless of the reason articulated by the employee for the failure, if the department determines that the failure involved work at a lower grade of skill or significantly lower rate of pay than applied to the employee on one or more recent jobs, and that the employee had not yet had a reasonable opportunity, in view of labor market conditions and the employee's degree of skill, but not to exceed 6 weeks after the employee became unemployed, to seek a new job substantially in line with the employee's prior job skill and rate of pay.

Wisconsin Administrative Code § DWD 128.01 states as follows, as relevant here:

DWD 128.01 Able to work and available for work.

(1) APPLICABILITY. Under s. 108.04 (2), Stats., a claimant shall be eligible for unemployment benefits for any week of total unemployment only if the claimant is able to perform suitable work and available for suitable work. ...

(4) AVAILABLE FOR WORK.

(a) Withdrawal from labor market. Available for work means that the claimant maintains an attachment to the labor market and is ready to perform full-time suitable work in the claimant's labor market area. During any week, a claimant is not available for suitable work if he or she has withdrawn from the labor market due to restrictions on his or her availability for work. In determining whether a claimant has withdrawn from the labor market, the department shall consider one or more of the following factors:

1. `Salary or wages.' A claimant is considered to have withdrawn from the labor market if he or she is not available for full-time suitable work at a wage reasonably comparable to the usual wage that was paid to the claimant while working in the claimant's usual occupation. The claimant's usual wage is determined by evaluating the wage rates that were paid to the claimant in one or more previous jobs since the start of the claimant's base period. The claimant's usual occupation is determined by considering the claimant's training and experience as evidenced by the claimant's employment since the start of the claimant's base period....

6. `Types of work sought.' A claimant is considered to have withdrawn from the labor market if the claimant does not broaden his or her availability for work to additional types of suitable work as the period of his or her unemployment lengthens.

The statutes permit a canvassing period of six weeks for unemployed workers to continue to limit themselves to work at an equivalent level of skill and pay as their former position. As of the date of hearing, the claimant had been unemployed for 23 weeks, yet he was still limiting his work search to positions paying at least $85,000, and located in the dairy equipment industry. Even though $85,000 is less than the $120,000 he was paid in his last position, it is still a very high level of pay to expect to receive in the current economy, and too high to expect to be able to demand after 23 weeks of unemployment. In addition, the claimant had limited his search to the dairy equipment industry even though he admitted that "no one in the dairy industry is buying anything."

Consequently, the commission agrees with the ALJ that the claimant was not available for work, within the meaning of Wis. Stat. § 108.04(2)(a)1., because he had withdrawn from the labor market, within the meaning of Wis. Adm. Code § DWD 128.04(4), due to his salary requirement and his limitation on the type of work he was seeking.

The commission also agrees with the ALJ's reasoning that, given the amount of time and money the claimant has invested in his new business, it is unlikely he would abandon it to work full time in a position paying less than $85,000 per year. See, McDermid v. Country Pride Realty, Inc., UI Hearing No. 01401747AP (LIRC Oct. 15, 2001)(not plausible that claimant actually interested in obtaining full-time work as an employee given her significant investment of time and money in a new business).


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uploaded 2009/10/23