SHEME S THORNS, Employee

RAVENWOOD CLINIC INC, 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 business operating a clinic for substance abusers, for about eleven months as a substance abuse counselor. Her last day of work was March 12, 2010 (week 11).

The employer has a written policy which provides, in relevant part:

All pay to clinical staff shall be made within 30 days of receipt of compensation from the payer.

There is no set payday due to the unpredictability of when a payer compensates for services rendered. The Ravenswood Clinic shall target two paychecks per months and within 2-3 days of a projected payday when possible. The issuance of more than two checks per month will occur if payers are not rendering compensation in a timely fashion or compensation was delayed due to technical issues.

On multiple occasions during her employment the employee's paychecks were delayed or the employer would issue a check covering only a portion of the hours the employee had worked in the pay period. The erratic pay situation made it difficult for the employee to pay her bills and to satisfy her mortgage obligations. When she raised the matter with the employer, the employer responded that it was not getting paid from its outside funding sources and, further, that when the money did come it was behind in the rent or had other bills to pay. The employer explained that the best it could do was to issue the employee a partial paycheck. During the months of December of 2009 and January and February 2010, the employee received at least three paychecks that did not cover all the hours she had worked.

On March 12, 2010, the employee notified the employer she was quitting. She performed no services for the employer thereafter. On June 24, 2010, the employee received her final paycheck from the employer covering work she had performed prior to quitting.

The issue to be decided is whether the employee's quitting was for a reason permitting the immediate payment of benefits.

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).

Wisconsin Stat. § 109.03(1) requires that employers pay workers all wages earned within 31 days. The employer has an obligation to pay its workers wages when due, and employees must be able to trust their employers to timely satisfy their payroll obligations. Harycki v. Widemeyer Service Center, Inc., UI Hearing No. 91-603649 (LIRC Aug. 26, 1991). However, the employer in this case had a policy of only paying its workers after it received payment from an outside source. The employer conceded that workers may have to wait nearly four months to get a paycheck and that it fell behind in its payroll from December of 2009 through February of 2010. When the employee complained about the problem, the employer explained that it could not pay her until it received payment and, further, that it might have other priorities, such as rent, that it put ahead of meeting employee payroll.

The erratic manner in which the employee was paid created a hardship for her and adversely affected her ability to pay her own bills. The employer's continued failure to meet its payroll obligations was a circumstance that justified the employee's decision to quit.

The commission therefore finds that in week 11 of 2010, the employee voluntarily terminated her employment with good cause attributable to the employer, within the meaning of Wis. Stat. § 108.04(7)(b).

The decision of the administrative law judge is reversed. Accordingly, the employee is eligible for benefits beginning in week 11 of 2010, provided she is otherwise qualified.

Dated and mailed April 15, 2011

VL 1005.01 : VL 1059.07

 BY THE COMMISSION:

/s/ Robert Glaser, Chairperson

/s/ Ann L. Crump, Commissioner

Laurie R. McCallum, Commissioner

NOTE: Although the commission conferred with the administrative law judge about witness credibility and demeanor, the administrative law judge had no credibility or demeanor impressions to impart. The commission's reversal is not based on a differing assessment of witness credibility. Rather, the commission reverses because it believes the evidence supports a conclusion that the employee was paid in an erratic manner and that this provided her with good cause for quitting, whether or not she notified the employer she intended to do so.

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uploaded 2011/06/03