RENAYE O PHILLIPS-COOK, Employee

COUNTY OF DANE, 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 for the employer, a county human services agency, for five years as a mail clerk. Her last day of work was April 21, 2010 (week 17).

The employer manages funds for individuals who are unable to manage their own. These clients are known as "protective payees." On December 24, 2009, the employee cashed a check made out to one of the employer's clients and deposited the money into her own account. The check was a rebate from a telephone company in the amount of $100. The employer learned about the matter when, after the client complained that he had not received the rebate, the employer obtained a copy of the cancelled check from the telephone company which showed that the check had been endorsed by the employee.

The employer questioned the employee about the matter. The employee admitted to having deposited the check into her own account. However, she explained that she did so because her niece told her the client was a friend of hers and had asked her to cash his check for him. The employee contended that the client did not have a bank account and did not want to pay a check cashing fee. She explained that she put the check in her account, then gave an equivalent amount of money to her niece to give to her friend. The employer spoke with the client and the niece, after which it concluded that the employee had, in fact, stolen the funds. She was discharged as a result.

The issue to be decided is whether the employee's discharge was due to misconduct connected with her employment.

In Boynton Cab v. Neubeck, 237 Wis. 249, 296 N.W. 636 (1941), the leading case with respect to the meaning of the term "misconduct" as applied to unemployment compensation 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 employe, 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 employe'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."

Proof of theft must be by clear, convincing, and satisfactory evidence. Kuehn v. Kuehn, 11 Wis. 2d 15, 26 (1960). The employer met that burden in this case. The employer established that the employee cashed a check made out to one of its clients and deposited the money into her own account. The employee contended that she did not steal the check, but was asked to cash it by her niece, who was a friend of the client's. However, the check was not mailed to the client, but to the employer, which manages the client's finances. Checks made out to the client are not forwarded to him, but are deposited directly into a client account. The employee's job was to open the mail, including checks; the employee would have been the one who opened the client's check. The check in question was never logged in as having been received. Given all the circumstances, the employee's explanation that the check came to her through a friend of the client's is not credible. To the contrary, the commission is convinced that the employee misappropriated the check when opening the employer's mail.

The commission, therefore, finds that in week 17 of 2010, the employee was discharged for misconduct connected with her employment, within the meaning of Wis. Stat. § 108.04(5).

The commission further finds that the employee was paid benefits in week 18 of 2010 and weeks 20 through 45 of 2010 in the total amount of $9,801, for which she was not eligible and to which she was not entitled, within the meaning of Wis. Stat. § 108.03(1). Pursuant to Wis. Stat. § 108.22(8)(a), she is required to repay such sum to the Unemployment Reserve Fund.

The commission further finds that waiver of benefit recovery is not required under Wis. Stat. § 108.22(8)(c), because although the overpayment did not result from the fault of the employee as provided in Wis. Stat. § 108.04(13)(f), the overpayment was not the result of a department error. See Wis. Stat. § 108.22(8)(c)2.

The decision of the administrative law judge is reversed. Accordingly, the employee is ineligible for benefits beginning in week 17 of 2010 and until seven weeks have elapsed since the end of the week of discharge and she has earned wages in covered employment performed after the week of discharge equaling at least 14 times her weekly benefit rate which would have been paid had the discharge not occurred. She is required to repay the sum of $9,801 to the Unemployment Reserve Fund. This decision also results in an overpayment of Federal Additional Compensation (FAC) benefits. The employee will receive, or may have already received, a separate "UCB-25 Notice of Federal Additional Compensation Overpayment" regarding the amount of FAC benefits that must be repaid.

Dated and mailed November 12, 2010
phillre . urr : 164 : 1 MC 630 . 14

/s/ James T. Flynn, Chairperson

/s/ Robert Glaser, Commissioner

Ann L. Crump, Commissioner

The commission conferred with the administrative law judge about witness credibility and demeanor. The administrative law judge had no demeanor impressions to impart. For the reasons set forth in the decision, the commission does not find the employee's explanation for her actions to be credible. The commission also notes that, even if it were to credit the employee's explanation for her actions, it would nonetheless be inclined to find misconduct in this case. Cashing a check made out to a client at the request of a friend, without confirming with a case manager or other responsible individual that this was appropriate, would constitute a serious lapse of judgment going beyond mere unsatisfactory conduct or ordinary negligence.

NOTE: Repayment instructions will be mailed after this decision becomes final. The department will withhold benefits due for future weeks of unemployment in order to off set overpayment of U.I. and other special benefit programs that are due to this state, another state, or to the federal government.

Contact the Unemployment Insurance Division, Collections Unit, P.O. Box 7888, Madison, WI 53707, to establish an agreement to repay the overpayment.

cc: Erick Didrikson
Attorney Marcia MacKenzie
County of Dane

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