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

LAKEYCIA T HOWARD, Employe

CONSECO FINANCE SERV CORP, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 00600516MW

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 for about three months as a loan originator for the employer, an operator of a home loan refinancing business. Her last day of work was December 21, 1999 (week 52), when she was discharged for falsifying her application for employment.

In 1995, the employe was convicted of a felony. When she applied for work with the employer in September of 1999, she was asked to complete an employment application. She answered all of the questions and supplied all of the information requested except for a question that asked whether she had been convicted of a crime. The question afforded her the opportunity to check a "yes" box or a "no" box and to supply a written explanation if she checked the yes box. She did not answer the question. She gave the application to an individual who asked her certain questions about the application but not about the unanswered question. A second individual who also had the application, asked certain questions about the application, but again did not ask about the unanswered question interviewed her. She offered no comment to either individual about the unanswered question. A background check conducted by the employer's corporate office staff disclosed her conviction. Upon reviewing her employment application and observing that the question relating to convictions had not been answered she was discharged for falsifying her employment application.

The issue to be decided is whether the employe was discharged for misconduct connected with her employment.

In Boynton Cab Co. v. Neubeck & Ind. Comm., 237 Wis. 249, 296 N.W. 636 (1941), the leading case with respect to the meaning of the term "misconduct" as applied to unemployment compensation in the United States, the court said, in part, as follows:

" . . . the intended meaning of the term 'misconduct' . . . is limited to conduct evincing such wilful or wanton disregard of an employer's interests as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect of his employee, or in carelessness or negligence of such degree or recurrence as to manifest equal culpability, wrongful intent or evil design, or to show an intentional and substantial disregard of the employer's interests or of the employee's duties and obligations to his employer. On the other hand mere inefficiency, unsatisfactory conduct, failure in good performance as the result of inability or incapacity, inadvertencies or ordinary negligence in isolated instances, or good-faith errors in judgment or discretion are not to be deemed 'misconduct' within the meaning of the statute."

The commission finds that the employe intentionally withheld information from the employer that it had a right to ask given the position for which she was applying. The employe's initial explanation for not completing the felony question was that the employer rushed her. After it was pointed out that the employe completed the question immediately before the felony question and the question immediate after the felony question, and indeed every other question, the employe testified that she skipped around it and then it was taken from her before she could complete it. The employe then stated, "I stalled on the question because I would rather give an explanation rather than check yes on the question." Later, the employe was asked "And your response to why you left it blank was that you wanted to explain your response to the question. Is that correct?" The employe answered "I can't say that was the reason I left it blank. No." The employe offered no reasonable explanation for failing to accurately complete the employment application.

The employe was applying for work as a loan originator and the employer had a justifiable reason for asking whether she had been convicted of a felony. The employe was given the opportunity to explain any conviction. The employe, by her own testimony, knowingly did not complete the question that asked about her felony conviction.

The commission therefore finds that in week 52 of 1999 the employe was discharged from her employment and for misconduct connected with her work within the meaning of Wis. Stat. § 108.04(5).

The commission further finds that the employe was paid benefits in the amount of $303.00 for weeks 13 and 14 of 2000, for which the employe was not eligible and to which the employe was not entitled, within the meaning of Wis. Stat. § 108.03(1).

The final issue to be decided is whether recovery of overpaid benefits must be waived.

Wisconsin Statute § 108.22(8)(c), provides that the department shall waive the recovery of overpaid benefits if the overpayment was the result of departmental error, and the overpayment did not result from the fault of the employe. Under Wis. Stat. § 108.02(10e)(a) and (b), department error is defined as an error made by the department in computing or paying benefits which results from a mathematical mistake, miscalculation, misapplication or misinterpretation of the law or mistake of evidentiary fact, or from misinformation provided to a claimant by the department, on which the claimant relied.

The overpayment in this case results from the commission's reversal of the appeal tribunal decision. Such reversal was not due to department error as defined in Wis. Stat. § 108.02(10e)(a) and (b). Rather, the commission has reached a different legal conclusion when applying the law to the facts found.

The commission further finds that waiver of benefit recovery is not required under Wis. Stat. § 108.22(8)(c), because although the overpayment did not result from the fault of the employe as provided in Wis. Stat. § 108.04(13)(f), the overpayment was not the result of a department error. See Wis. Stat. § 108.22(8)(c)2.

DECISION

The decision of the administrative law judge is reversed. Accordingly, the employe is ineligible for benefits beginning in week 52 of 1999, and until seven weeks elapse since the end of the week of discharge and the employe has earned wages in covered employment equaling at least 14 times the weekly benefit rate which would have been paid had the discharge not occurred. The employe is required to repay the sum of $303.00 to the Unemployment Reserve Fund. Benefit checks for weeks 1 through 5 of 2000 were withheld as a forfeiture. Since benefits are now denied for such weeks, those payments cannot be applied to the forfeiture. The amount restored to the forfeiture balance is $1,355.00.

For purposes of computing benefit entitlement: Base period wages from work for the employer prior to the discharge shall be excluded from any computation of maximum benefit amount for this or any later claim. If the employe was also paid base period wages from work by other covered employers, the excluded wages shall be used to determine benefit eligibility. However, any benefits otherwise chargeable to a contribution employer's account shall be charged to the fund's balancing account.

Dated and mailed April 25, 2000
howarla.urr : 132 : 6 : MC 630.20

/s/ David B. Falstad, Chairman

/s/ Pamela I. Anderson, Commissioner

James A. Rutkowski, Commissioner

MEMORANDUM OPINION

The commission did discuss witness credibility and demeanor with the administrative law judge. The administrative law judge indicated that his decision rested on the belief that the employe's actions did not constitute falsification. For reasons set forth in its decision the commission disagrees with the administrative law judge's legal conclusion.

cc: SENIOR COUNSEL BILL R JOHNSON
CONSECO FINANCE SERVICING CORP
CONSUMER FINANCE DIV LEGAL
332 MINNESOTA ST STE 520
SAINT PAUL MN 55101

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