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


DOUGLAS S ZUNKER, Employe

ON CUE INC, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 99400005AP


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

The employe worked seven months, most recently in the third-key position, for the employer, a music store. His last day of work was on June 22, 1998 (week 26).

The employer's assistant manager, Ms.Teska, hired the employe away from a job. Ms. Teska offered the employe $8.00 per hour, $5.10 in check and $2.90 in cash. Ms. Teska also told the employe that he would be full-time and receive full benefits. When he received his check the cash payments were not on his pay stub and he did not pay social security or federal or state income tax on the money. At some point the employe became upset because he was not receiving benefits. That matter was later resolved and he did receive full benefits.

Seven months after the employe started and about two weeks before he quit, he saw Ms. Teska's paycheck and saw that she, an assistant manager, made less than he did, $7.10 per hour. (The employe began employment at $5.10 per hour but by the time he ended his employment had received a raise to $6.10 because he was promoted to another position.) He confronted Ms. Teska and she admitted that the money he was being paid in cash was not, as she had claimed, from some special fund in the bank, but coming out of Ms. Teska's own pocket.

The employe complained to the manager, Mr. Hamblin, in March of 1998 that Ms. Teska said he would be paid $8.00 per hour. The employe told Mr. Hamblin that Ms. Teska was paying him cash. In fact, Mr. Hamblin thought it was strange that on pay day the employe would receive two envelopes. Mr. Hamblin asked Ms. Teska if she was paying cash out of her own pocket and Ms. Teska said no. He did not confront Ms. Teska again.

The employe told both Mr. Hamblin and the district manager, Mr. Quimby, about the cash arrangement that Ms. Teska had made with him. Mr. Hamblin and Mr. Quimby discussed the matter with each other. Mr. Quimby and Mr. Hamblin thought the situation was so weird that they were just going to see how it played out. Mr. Quimby indicated about a week before the employe quit that he wished the employer could increase the employe's wage, but it could not.

The employe quit because he believed Ms. Teska had misled him and because he could not make it on the amount he was being paid by check. He therefore gave notice to Mr. Hamblin that he was quitting.

The issue to be decided is whether the employe quit his employment for any reason that would permit the immediate payment of unemployment insurance benefits. The employe's position is essentially that he quit his employment with good cause attributable to the employer.

"Good cause attributable to the employing unit," means some act or omission by the employer justifying the employe's quitting; it involves "some fault" on the part of the employer and must be "real and substantial." Nottelson v. DILHR, 94 Wis. 2d 106, 120, 287 N.W.2d 763 (1980) (citing Kessler v. Industrial Comm., 27 Wis. 2d 398, 401, 134 N.W.2d 412 (1965), and Hanmer v. DILHR, 92 Wis. 2d 90, 98, 284 N.W.2d 587 (1979)). For the exception to apply, the quitting must be "occasioned by" the act or omission of the employer which constitutes good cause. Hanmer, 92 Wis. 2d at 98 (citing Kessler v. Industrial Comm., 27 Wis. 2d 398, 401, 134 N.W.2d 412 (1965)).

Ms. Teska was acting as an agent for the employer in her dealings with the employe. While she may not have had the authority to make the assurances that she did, and to pay him in cash above his approved hourly rate, she in fact did so. The employe alerted the employer to the situation prior to quitting. The employer merely accepted Ms. Teska's denial of the arrangement, despite the fact that the employe was receiving an envelope containing cash and an envelope containing his payroll check. While the employer could sit back and see how the situation played out, the fact remains that the employe was promised $2.90 per hour more than he was receiving at the end of his employment. The employer's actions in promising the employe $8.00 per hour, and failure to adhere to that promise provided the employe with good cause attributable to the employer for quitting.

The commission therefore finds that in week 26 of 1998, the employe voluntarily terminated his employment with the employer with good cause attributable to his employment within the meaning of Wis. Stat. § 108.04(7)(b).

DECISION

The decision of the administrative law judge is reversed. Accordingly, the employe is eligible for benefits beginning in week 26 of 1998, if he is otherwise qualified.

Dated and mailed April 16, 1999
zunkerd.urr : 132 : 6  VL 1005 VL 1059  VL 1080.02

/s/ David B. Falstad, Chairman

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

The commission did consult with the ALJ regarding witness credibility and demeanor. The ALJ did not have any distinct credibility impressions of either party. However, the ALJ did believe that the employe's story was essentially too bizarre to be made up. The commission agrees and has credited the employe's version. The commission notes that the employe's allegations were not first made post-employment. The commission does disagree with the ALJ's legal conclusion that the employer is not responsible for Ms. Teska's actions and promises.


Pamela I. Anderson, Commissioner (Dissenting):

I am unable to agree with the result reached by the majority herein and I dissent. I agree that the employe's story is bizarre but that does not mean it was true. The assistant manager testified she loaned him money to help him get his driver's license back and to help him get on his feet. She said she loaned him about $500 that he has not paid back. He would pay her back $25 and then borrow it back in a couple of days. In the beginning of his employment, the employe admitted the assistant manager loaned him money to help buy a car from her. He paid $300 for her Cavalier.

The reasons I find that the employe was not creditable start with his argument about why would he quit a job where he was making $6.75 an hour to take one where he made $5.15 per hour. The employe had a seasonal job with the assistant manager's parents. The assistant manager indicated she told him that "he could work here and it wasn't seasonal. I offered him a sales position. I knew he was laid off at the time." The employe worked for the employer from November 18, 1997 to June 22, 1998. I find that it is credible that the employe did not quit the seasonal job but was laid off when he began working for the employer. Lots of seasonal work is over by November and the assistant manager would likely have knowledge about her parent's business.

The employe alleged that the assistant manager was paying him $2.90 per hour in cash. If this was true the assistant manager would already have given the employe $500 (figured at 30 hours per week) by the end of 1997. The employe does not indicate he that he talked to the employer until after March about his pay problems and he does not quit until late June.

The employe and the assistant manager had a dispute shortly before he quit. Exhibits 3 and 4 are the statements the employe made to the adjudicator at the time his claim was investigated. He said he quit because of sexual harassment. He admitted "I can't really say that she ever threatened my job in return for sexual favors." The assistant manager asked the employe to leave the store because he was insulting her on the floor. She said he was calling her a `whore' because he found out she had a boyfriend. He said that I slept with everyone in the store. She did not fire him or have the power to fire him.

The employe testified "During the confrontation on the floor I don't recall if I called her a `whore.' I don't recall what words I used. It was a heated argument because I didn't get my cash. I don't recall saying anything like `whore' to her on the floor at all." The employe also reported "When I confronted Ms. Teska about my cash it was about 3 weeks or so before I quit."

I do not find it credible that the assistant manager paid the employe $2.90 per hour for his job out of her own pay when she was only earning $7.10 per hour. I believe the loan version of what happened because it much more believable. The employe would have needed to confront the assistant manager much sooner than 3 weeks before he quit unless we believe that the assistant manager paid him $2.90 per hour for close to six months. If she had paid him $2.90 per hour for six months, why would she ever stop.

I do disagree with the administrative law judge on the question of whether the employer can be liable for promises managers make. If I had believed that the assistant manager promised him $2.90 out of a cash fund or even her own money, I believe that the employer had an obligation to resolve the problem. I do not believe the assistant manager made the promise the employe alleges she made.

For these reasons, I would affirm the result of the administrative law judge's decision.

Pamela I. Anderson, Commissioner

cc: ON CUE INC


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