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

MICHELLE M HEATH, Employee

FINE NORTHERN OAK, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 12400981AP


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 employee is eligible for benefits in weeks 36 through 52 of 2011. There is no benefit overpayment.

Dated and mailed September 5, 2012

BY THE COMMISSION:

/s/ Robert Glaser, Chairperson

/s/ Ann L. Crump, Commissioner

/s/ Laurie R. McCallum, Commissioner

MEMORANDUM OPINION

The dispute in this case is whether the employee is entitled to unemployment insurance benefits, for weeks 36 through 52 of 2011, as the result of a compromise agreement the employee entered into, along with the employer and the employer's worker's compensation insurance carrier, on January 12, 2012. The relevant statute, Wis. Stat. § 108.04(12)(e) provides in part, that any "individual who receives a temporary total disability payment for a whole week under ch. 102 ...shall be ineligible for benefits paid or payable for that same week under this chapter [ch. 108] unless otherwise provided by federal law."

The compromise agreement provided for a $50,000 lump sum payment to the employee in exchange for the employee's waiver of all rights to claim any further benefits from the employer under ch. 102, except for the right to claim reimbursement for injury-related medical expenses incurred after November 30, 2011. Of the $50,000 lump sum payment, attorney fees were allocated at the sum of $10,000, otherwise the compromise agreement made no other allocation. The settlement included, among other things, "any claims for past, present or future temporary disability, permanent disability, as well as past medical expenses incurred before November 30, 2011." The agreement also provided in its settlement, the possibility of bad faith penalty claims, late payment penalty claims, unreasonable refusal to rehire claims, claims for the expenses of vocational rehabilitation, disfigurement and safety violation penalties. The compromise agreement otherwise made no mention of any allocation of the settlement payment to the employee as payment for any particular week or weeks for temporary total disability (TTD), TTD maintenance or travel benefits for retraining.

The employer's insurance carrier's attorney who drafted the compromise agreement testified at the UI hearing that a majority of the settlement payment reflected the employee's retraining claim. (See synopsis, pg. 5). Exhibit 4(1), a letter prepared by the employee's attorney represented to the Department of Vocational Rehabilitation (DVR) that the compromise agreement included an estimated claim for retraining benefits totaling $10,400 based upon the employee's TTD weekly benefits multiplied by 30 weeks.

The administrative law judge, however, found the compromise agreement did not allocate any portion of the settlement payment to temporary total disability. The commission agrees with this analysis and conclusion. The compromise agreement contemplated the employee waiving all of her rights to claim any further benefits from the employer under ch. 102, including past, present or future temporary disability, permanent disability and past medical expenses incurred before November 30, 2011. Wis. Stat. § 108.04(12)(e) requires specific weekly receipt of TTD for each week of UI claimed and the compromise agreement did not provide for this level of specification or weekly allocation. Based upon this compromise agreement, the requirements of Wis. Stat. § 108.04(12)(e) have not been met.

The employer asserts that the ALJ incorrectly relied upon Gregory W. Stebler, UI Dec. Hearing No. 04004681BO (LIRC Feb. 18, 2005), arguing that the case is distinguishable from the facts involving the employee's compromise agreement. In Stebler, the compromise agreement did not indicate that the monies paid to the claimant were vocational rehabilitation benefits or even intended to be used for vocational rehabilitation. The employer argues that the settlement agreement involved here specifically identifies "any claims for past, present or future, temporary disability" which is contrary to the compromise in Stebler. This argument however ignores that the compromise agreement involved here also identifies "any claims for past, present or future permanent disability as well as past medical expenses incurred before November 30, 2011."

The employer also argues that future compromise agreements of this nature will be affected since parties can no longer be assured that settlement efforts will not be rendered null and void by the application of a different statute. The commission's decision of course does not render the compromise of worker's compensation benefits null and void. An employee's eligibility for unemployment benefits however is not determined by looking at private agreements negotiated between the claimant and the employer. Rather, a claimant's eligibility for unemployment insurance benefits depends on the application of the provisions of the Unemployment Compensation Act (ch. 108) and to all relevant facts. See Roberts v. Industrial Commission, 2 Wis. 2d 399, 86 N.W.2d 406 (1957). Likewise, Wis. Stat. § 108.12 provides that agreements by employees to waive unemployment insurance benefit rights are invalid. Under these circumstances, it must be held that the employee's receipt of the lump sum settlement payment under the compromise agreement does not constitute receipt of temporary total disability payments under ch. 102 of the statutes as required under Wis. Stat. § 108.04(12)(e).

heathmi : 135 : 5

cc: Attorney Ian Mevis
Attorney Daniel Pedriana
SFM Mutual Insurance Co.


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uploaded 2012/09/12


Footnotes:

(1)( Back ) Wis. Admin. Code LIRC 104 provides that the record used for review by the commission is based solely on the record, including the evidence previously submitted at the hearing before the ALJ. The additional documentation submitted by the employee's attorney, therefore, was not considered or reviewed by the commission in reaching its decision.