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

DENNIS L WICKERT, Employee

Involving

TRADE READJUSTMENT ACT

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 11607763MW


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

Department records show that the employee was laid off from his work at a Chrysler plant in Kenosha on July 12, 2008. The employee initiated a claim for unemployment insurance (UI) benefits on July 16, 2008 (week 29). His weekly benefit rate was initially $355, but the amount increased to $363 in week 2 of 2009. The employee received UI benefits periodically through week 26 of 2009, at which time he exhausted his regular UI benefits. The employee became eligible for benefits under the Emergency Unemployment Compensation (EUC) Act of 2008 the following week. However, the employee resumed working for Chrysler in week 27 of 2009 and did not claim or collect EUC.

According to department records, on September 2, 2009, Chrysler Group LLC was certified by the U.S. Department of Labor as having been adversely affected by foreign competition. The certification allows employees who were separated from the company due to a lack of work on or after the impact date of May 27, 2008, to apply for benefits under the federal Trade Adjustment Assistance (TAA) program. The TAA program was created by the federal government in 1974 to assist individuals who became unemployed as a result of increased imports return to suitable employment. The TAA program provides for reemployment services and allowances for eligible individuals. See, 19 U.S.C. § § 2271 et seq.; 20 C.F.R. § 617.

TAA benefits can include regular weekly cash payments to an adversely affected worker with respect to such worker's unemployment, referred to as "trade readjustment allowances" (TRA). See, 20 C.F.R. § § 617.1(b), 617.3(nn). To qualify for TRA for any week of unemployment, an individual must meet several requirements. See, 20 C.F.R. § 617.11. Among those requirements is that the individual must have exhausted all rights to any UI to which the individual was entitled (or would have been entitled if the individual had applied therefor). See, 20 C.F.R. § 617.11(a)(2)(v). The total amount of TRA payable for a week of total unemployment is an amount equal to the most recent weekly benefit amount of UI payable to the individual for a week of total unemployment preceding the individual's first exhaustion of UI following the individual's first qualifying separation. See, 20 C.F.R. § 617.13(a).

The employee was laid off again in March 2010. He opened a new claim for UI benefits on March 22, 2010 (week 13). The employee had sufficient wages to establish a new benefit year. His prior benefit year had ended in week 28 of 2009. The employee claimed and received one week of UI benefits before returning to work for Chrysler. The employee worked for Chrysler until October 22, 2010
(week 43). The plant in which the employee had worked was closed. The employee reopened his benefits claim on October 27, 2010 (week 44). He filed for, and received, weekly benefits thereafter.

The department issued a computation on December 23, 2010, informing the employee that he was potentially eligible for benefits under the Trade Reform Act of 2009. The computation noted that the employee's eligibility period began on July 13, 2008, which is the day following his first qualifying separation from Chrysler, and runs through October 20, 2012, which is 104 weeks after his most recent qualifying separation. The employee's weekly TRA amount is $363. The maximum amount of TRA payable to the employee was calculated to be $2,234, which would be paid out at the rate of $363 for a period of six weeks.

The employee disagreed with the computation and requested an appealable document. The department issued a determination on April 21, 2011, containing the same information as that in the December 23, 2010, computation. The employee appealed. Following a hearing before an administrative law judge, an appeal tribunal decision was issued, affirming the department's determination. The employee filed a timely petition for commission review.

The issue before the commission is whether the department properly calculated the maximum amount of TRA potentially payable to the employee.

The rules for calculating the maximum amount of TRA payable to an individual under a certification are set forth by the federal government in 19 U.S.C. § 2293 and in 20 C.F.R. § 617.14. To determine an individual's maximum TRA entitlement, such as that of the employee, the formula is as follows:

1. Multiply by 52 the weekly amount of TRA payable to such individual for a week of total unemployment, as determined under 20 C.F.R. § 617.13(a); and

2. Subtract from the product derived the total sum of UI to which the individual was entitled (or would have been entitled if the individual had applied therefor) in the individual's first benefit period. The individual's full entitlement shall be subtracted under this paragraph, without regard to the amount, if any, that was actually paid to the individual with respect to such benefit period.(1) (Emphasis added.)

The application of the maximum TRA rule to the employee's case appears in the table below:

Potential TRA

$18,876

$363 x 52 weeks

 

 

 

Less regular state UI maximum

benefit amount in first benefit year

(   9,382)

$355 x 7 weeks plus

$363 x 19 weeks

 

 

 

Less EUC maximum benefit

amount in first benefit year

(   7,260)

$363 x 20 weeks

 

 

 

Maximum TRA entitlement

$  2,234

 

In his petition for commission review, the employee argues that, because he returned to work in week 27 of 2009 after exhausting his regular state UI benefits in week 26 of 2009 but before receiving any EUC, the full amount of EUC should not be subtracted from his maximum TRA entitlement. The commission disagrees.

As noted above, states are required to subtract from an individual's potential TRA the full amount of UI the individual was entitled to receive in the individual's first benefit year following a qualifying separation, regardless of whether any of those UI benefits were actually paid to the individual. This is because TRA may only be paid to an individual who has exhausted all rights to any UI benefits to which the individual was entitled, or would have been entitled if the individual had applied for those benefits. The fact that the employee did not ask for EUC in 2009 is immaterial for purposes of calculating his maximum TRA entitlement. He was, and remains, entitled to EUC totaling $7,260 for the benefit year that ended in week 28 of 2009.

One of the important provisions of the Trade Act is that payment of TRA may be made to an individual only if, among other requirements, the person "has exhausted all rights to any unemployment insurance to which he was entitled (or would be entitled if he applied therefor)." 19 U. S. C. § 2291(a)(3)(B). The point of this provision is to try to make the federal Trade Act funds go as far as possible by ensuring that TRA will only be paid when there are no other UI benefits available to the unemployed individual. See, Theresa L. Poznanski, UI Dec. Hearing No. 02006103FL (LIRC April 11, 2003).

Here, the employee has an unexhausted entitlement to EUC. That is, he has a balance of EUC totaling $7,260 remaining from his first benefit year. Should the employee exhaust his regular UI benefits while the EUC08 period is in effect, the employee will be paid the EUC he became entitled to in the benefit year ending in week 28 of 2009. A claimant must exhaust all EUC based on a prior benefit year before the claimant may receive EUC from a subsequent benefit year. The department refers to this as "EUC carryover." The department does not set up EUC monetary entitlements based on second and subsequent UI claims until the first is exhausted. The employee would have to exhaust EUC of $7,260 before the department would calculate additional EUC entitlement. All EUC would have to be paid out before any TRA could be paid.

The commission recognizes that the calculation of the employee's maximum TRA entitlement is largely an academic exercise. Department records show that the employee began receiving a pension from Chrysler in week 24 of 2011, well before he had exhausted his regular state UI benefits on a new benefit started in week 13 of 2011. Contrary to the employee's assertion in his petition that his receipt of pension does not affect his TRA eligibility in any way, federal law provides that TRA may only be paid if a claimant is otherwise eligible for UI benefits. A pension reduction that applies during payment of regular unemployment also applies to weeks paid under the TAA program.

Pursuant to Wis. Stat. § 108.05(7), if a claimant receives a pension payment, the department must reduce benefits otherwise payable to the claimant for a week of partial or total unemployment if the pension is based on work for any employer since the start of the employee's applicable base period. Because the employee in this case receives pension payments from Chrysler, and Chrysler is an employer in the employee's base period, the department must subtract the amount of the employee's pension payments from the amount he would potentially receive in UI benefits. Because the amount of the employee's pension payments exceeds his weekly UI benefit amount, he is monetarily ineligible for cash UI benefits of any kind, including TRA, so long as he continues to receive his pension and Chrysler remains in his base period.

The commission therefore finds that the department properly calculated the maximum amount of TRA potentially payable to the employee based on his qualifying separations from Chrysler in 2008 and 2010.

DECISION

The decision of the administrative law judge is affirmed. Accordingly, the maximum amount of TRA the employee is eligible to receive after he exhausts all other unemployment insurance programs payable during the TRA eligibility period that ends on October 20, 2012 (week 42), is $2,234.

Dated and Mailed February 3, 2012

BY THE COMMISSION:

/s/ Robert Glaser, Chairperson

/s/ Ann L. Crump, Commissioner

/s/ Laurie R. McCallum, Commissioner

MEMORANDUM OPINION

The employee included with his petition for commission review several computer printouts he received from a department UI benefit specialist. The commission's rules provide, at Wis. Admin. Code § LIRC 1.04, that review by the commission shall be based on the record of the case including the evidence previously submitted at hearing before the department. While the computer printouts were not introduced at hearing, the commission will address the issues raised concerning the printouts because they are considered department records.

The employee is correct in noting that the department's computer system is programmed to automatically set up a claimant's EUC eligibility after the last check of regular UI benefits is paid in a benefit year. This programming complies with federal law. When the employee exhausted his regular UI benefits in week 26 of 2009, he became entitled to EUC in week 27 of 2009, regardless of whether he asked for those benefits or claimed them at the time. Contrary to the employee's assertion, he has not been penalized for EUC being set up in 2009 and being used to reduce his maximum TRA entitlement. The employee remains entitled to the EUC that was set up following his initial benefit claim. By law, if the employee had exhausted his regular UI benefits in a benefit year and continued to file claims, the department would have to pay him all carried-over EUC before paying him TRA.

The confusion from the computer printouts appears to result from the fact that, each time the employee began a new benefit year, the EUC amounts from prior claims, while carried over, are not listed on the Monetary Inquiry screen. As noted in the commission's decision, the department does not set up EUC monetary entitlements based on second and subsequent UI claims until the first EUC entitlement is exhausted.

Although it arrives at the same result as did the ALJ, the commission has substituted its own Findings of Fact and Conclusions of Law for those issued by the ALJ in order to more fully set forth the relevant facts and relevant law.

 

 


wickede . urr : 152 : 2

cc: Chrysler Group, LLC


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uploaded 2012/09/25


Footnotes:

(1)( Back ) 20 C.F.R. 617.14, Maximum amount of TRA.