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


MELISSA A VOGLER, Employe

MEDICAL BILLING SPECIALISTS, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 00200563EC


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 four years performing data entry and billing work for a medical billing business. Her last day of work was February 25, 2000 (week 9). She was discharged on February 29, 2000 (week 10).

The employer's owner's son began working at the business in November of 1999. He was hired to do marketing work for the business but was first going to be trained on various aspects of the business by the employe, as well as learning from other workers. The employe became aware of the son's rate of pay from a check stub that was kept in a file drawer which also had files which the employe used to perform her duties. The employe's rate of pay was $10.25 per hour. The owner's son's rate of pay was $13.50 per hour. The employe thought the son's rate of pay was outrageous. The employe told another worker what the son's rate of pay was. The other worker told other people in the building where the employer's business is located. The owner became aware that people were talking about her son's rate of pay at the break area shared by various businesses located outside the employer's offices in the building where the businesses were located. The employe was discharged because the owner considered that she had breached confidentiality and because of an earlier situation with the owner's son.

The issue before the commission is whether the employe was discharged for misconduct connected with her employment.

The commission has held that employes should know without express policies that gossiping about other workers' salaries is detrimental to the employer. In Culhane v. MLG Commercial Inc, UC Hearing No. 99-604782 (LIRC January 21, 2000), the commission stated "[T]he employe knew, or should have known, that salary information could not be divulged to other workers. A written rule prohibiting such actions of course would support the employer's case by establishing actual knowledge by the employe that her conduct was prohibited. However, lack of such a rule or explicit verbal instruction not to divulge information is not necessary."

The circuit court affirmed a similar finding in Chapin v. Marathon Implement Co. and LIRC, No. 98-CV-47, (Wis. Cir. Ct. Langlade County March 16, 2000). The court agreed that there was a breach of salary confidentiality even though the information was only disclosed to the employe's husband and the worker involved. The court stated even without an express policy, the employe knew that confidentiality was important to the employer and that breaches of confidentiality destroy the trust of an office. It is then impossible for an office to work effectively.

In this case, the employe was guilty of disclosing confidential wage information. The employe sought out and shared this information because she disliked the employer's son. She was outraged at what she perceived to be his unearned rate of pay. She had no right to do this and either knew or should have known it would harm the employer. No formal policy prohibiting such conduct is necessary in such a case.

The commission therefore finds that in week 10 of 2000, the employe was discharged and that the discharge was for misconduct connected with her employment within the meaning of Wis. Stat. § 108.04(5).

The commission further finds that the employe was paid benefits in the amount of $266 per week for each of weeks 11 through 17 of 2000, amounting to a total of $1,862; for which she was not eligible and to which she was not entitled, within the meaning of Wis. Stat. § 108.03(1), and pursuant to Wis. Stat. § 108.22(8)(a), she is required to repay such sum to the Unemployment Reserve Fund.

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 appeal tribunal decision is reversed. Accordingly, the employe is ineligible for benefits beginning in week 10 of 2000, and until seven weeks have elapsed since the end of the week of discharge and she has earned wages in covered employment performed after the week of discharge equaling at least 14 times her weekly benefit rate which would have been paid had the discharge not occurred. She is required to repay the sum of $1,862 to the unemployment reserve fund. The initial benefit computation (UCB-700), issued on March 6, 2000 is set aside. If benefit payments become payable based on other employment a new computation will be issued as to those benefit rights.

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 August 4, 2000
vogleme.urr : 178 : 5   MC 666.01   MC 687    MC 665.12

/s/ David B. Falstad, Chairman

/s/ Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

The commission did not consult with the ALJ regarding witness credibility prior to reversing. The ALJ found that while the employe's actions amounted to poor judgment but in the absence of a clear employer policy forbidding it, it did not amount to misconduct. The commission disagrees for the reasons stated in the decision and reverses accordingly.


NOTE: Repayment instructions will be mailed after this decision becomes final. The department will withhold benefits due for future weeks of unemployment in order to offset overpayment of U.C. and other special benefit programs that are due to this state, another state or to the federal government.

Contact the Unemployment Compensation Division, Collections Unit, P. O. Box 7888, Madison, WI 53707, to establish an agreement to repay the overpayment.

cc: ATTORNEY CARL T BAHNSON

ATTORNEY STEPHEN L WELD
WELD RILEY PRENN & RICCI SC


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