Wisconsin Labor and Industry Review Commission --
Summary of Wisconsin Court Decision relating to Unemployment Insurance


Subject: Mark Schmidt v. LIRC & Washington Group Intl, Inc., et.al, Case 08-CV-004494 (Wis. Cir. Ct., Milwaukee Co., October 20, 2008)

Digest Codes: BR 309  UW 925

The employee worked briefly as a journeyman millwright for two companies: Wisconsin Power Constructors, LLC, and Washington Group International, Inc. The employee worked for three days (4/21/04-4/23/04) for Wisconsin Power Constructors and for two hours on July 27, 2005 for Washington Group International. In December 2006 each company issued the employee a settlement check in the amount of $10,650.95, for a total of $21,301.90.

The employee argued that these settlement checks were “back pay” within the meaning of Wis. Stat. § 108.05(6) and therefore constituted base period wages within the meaning of Wis. Stat. § 108.02(4m). The commission held that these settlement checks were not back pay within the meaning of Wis. Stat. § 108.05(6) because the employee did not establish that these checks reflected payment “in lieu of personal services for past weeks” or “in the nature of back pay.” The employee testified at the hearing he did not know what the settlement checks represented.

In reviewing the commission decision which held that these settlement checks were not base period wages, the circuit court afforded the commission decision “due weight” deference because the commission’s interpretation of Wis. Stat. § 108.02(4m) is not one of long-standing. The court agreed with the commission’s argument that a reasonable interpretation could be made that these checks represented, at least in part, compensatory damages, punitive damages or even liquidated damages. The employee’s argument that his settlement with his former employers was confidential did not relieve him of his burden to establish how the checks represented back pay within the meaning of Wis. Stat. § 108.05(6).

The court also agreed with the commission that Wis. Stat. § 108.02(4m) did not apply to the Washington Group settlement check because the employee did not receive this settlement check from this employer until the 104-week period had expired. The court also dismissed the employee’s argument that this 104-week time period interfered with federal laws by placing a limit on when settlement money must be received in order to constitute back pay. The circuit court ruled that the cases cited by the employee in his brief were inapposite to this argument.

Held: The circuit court afforded the commission’s decision due weight deference because the commission’s interpretation of Wis. Stat. § 108.02(4m), Base Period Wages, is not one of long-standing. Therefore the court held that it could reverse the commission’s reasonable decision if another reasonable interpretation could be made. The court however concluded that the only reasonable interpretation of the relevant statutory law was that the settlement checks received by the employee did not reflect back pay within the meaning of Wis. Stat. § 108.05(6) and therefore did not constitute base period wages within the meaning of Wis. Stat. 108.02(4m).


Please note that this is a summary prepared by staff of the commission, not a verbatim reproduction of the court decision.

[ Search UC Decisions ] - [ UC Digest - Main Index ] - [ UC Legal Resources ] - [ LIRC Home Page ]