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


JANICE J BULANDA, Employe

DEERE PARK ASSOCIATES, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 98607780RC


On November 17, 1998, the Department of Workforce Development issued an initial determination in the above-captioned matter which held that the employe quit, but not for a reason permitting the immediate payment of benefits. The employe filed a timely appeal and a hearing was held before an appeal tribunal. On December 30, 1998, the appeal tribunal issued a decision which affirmed the initial determination. The employe filed a timely petition for commission review of the appeal tribunal decision.

Based on the applicable law, records and evidence in this case, the commission makes the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The employe worked for the employer, a business providing merchandise liquidation services for furniture stores, for approximately six months as office manager. Her last day of work was November 2, 1998 (week 45).

Prior to working for the employer, the employe had been employed by a similar business called Hilco Corporation (hereinafter "Hilco.") In March of 1998, while the employe still worked for Hilco, a telephone system valued at approximately $4,000 was stolen from one of Hilco's offices.

In April of 1998, a Hilco employe by the name of Richard Glabman told the employe that he was leaving Hilco to start his own business, and asked the employe to come work for him. The employe agreed to do so. On April 16, 1998, the employe began working for Mr. Glabman's company, Deere Park Associates, which is the employer in this case. Mr. Glabman, the president of the company, was the employe's direct supervisor.

On October 27, 1998, Mr. Glabman told the employe that he planned to meet with someone to get an estimate on installing a new telephone system. On November 2, 1998, Mr. Glabman was out of town, but had previously informed the employe that someone would be coming in look at the phones, and that she should show him where they were when he arrived. The employe looked at the telephones and noticed that they resembled the ones that had been stolen from her former employer. Upon closer inspection, the employe observed that the telephones had the names of Hilco employes on them. The employe contacted the CEO at Hilco, who confirmed that the telephones were stolen.

The next day the employe notified Mr. Glabman that she was resigning immediately. She did so because she believed the employer had engaged in illegal activities and was concerned about being considered an accessory to a crime.

The issue to resolve is whether the employe's quitting was for any reason permitting the immediate payment of benefits.

Under Wis. Stat. § 108.04(7)(a), an employe 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 employe 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 employer means that the employe's resignation is caused by some act or omission by the employer which justifies the employe's decision to quit. It involves some fault on the employer's part and must be real and substantial. Kessler v. Industrial Comm., 27 Wis. 2d 398, 134 N.W.2d 412 (1965); Hanmer v. DILHR, 92 Wis. 2d 90, 98, 284 N.W.2d 587 (1979). The statute specifically provides that good cause includes, but is not limited to, a request, suggestion, or directive by the employing unit that the employe violate federal or state law. Wis. Stat. § 108.04(7)(b).

The appeal tribunal found that the employe did not have good cause for quitting, reasoning that she should have questioned her supervisor before assuming that the telephone system was acquired by theft. The commission disagrees. The employe was aware that Hilco's telephone system had been stolen just before she and Mr. Glabman left Hilco and recognized Hilco's missing telephone system as the one her new employer intended to install. No one else associated with the employer had been employed at Hilco, apart from the employe and Mr. Glabman. Given these facts and circumstances, the employe was justified in assuming that the telephone system Mr. Glabman intended to install in his new business was stolen from Hilco, and the commission considers it neither necessary nor prudent to require her to confirm this fact with Mr. Glabman himself. Moreover, because Mr. Glabman was both the employe's direct supervisor and the president of the company, there was no traditional "chain-of-command" to which the employe could have been expected to take her concerns.

In finding that the employe did not have good cause to quit, the appeal tribunal also noted that the employe was never requested or directed by the employer to participate in any illegal activity. However, the employe was involved in the installation and use of telephones which she knew to be stolen, and her concerns about being considered an accessory to a crime were not unreasonable. Moreover, regardless of whether the employe was personally involved in any illegal activity, she was justified in wishing to disassociate herself from an employer whom she knew to be engaging in such conduct.

The commission, therefore, finds that in week 45 of 1998 the employe voluntarily terminated her work with the employer, and that her quitting was with good cause attributable to the employer, within the meaning of Wis. Stat. § 108.04(7)(b).

DECISION

The appeal tribunal decision is reversed. Accordingly, the employe is eligible for benefits beginning in week 45 of 1998, provided she is otherwise qualified. There is no overpayment with respect to this issue.

Dated and mailed: March 11, 1999
bulanja.urr : 164 : 1 VL 1005   VL 1080.12

/s/ David B. Falstad, Chairman

Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner


NOTE: The commission's decision to reverse the appeal tribunal decision did not involve an assessment of witness credibility.


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