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

Subject: South East Cable LLC v. LIRC and DWD, Case No. 2009-CV-17384 (Wis. Cir. Ct., Milwaukee Co., July 1, 2010)


Digest Codes: PC 713 - Hearing, Issues For Decision; PC 715 Hearing, Procedures, Misc.; PC 729 Hearing, Fair Hearing - issue preclusion

In 2003 DWD determined that South East Cable was a subject  employer effective January 1, 2001, based on finding that certain individuals performed services for it in calendar 2001 as "employees."  South East appealed, but an ALJ and then LIRC affirmed the determination. LIRC's decision then became final when South East failed to timely commence an action for judicial review.

In 2004, DWD issued another determination finding that South East was liable for UI tax contributions on certain amounts it paid to a number of individuals (including those whose services were the subject of the earlier case) in 2001-04, for services which those individuals were found to have provided as employees. South East appealed that decision. An ALJ subsequently issued a decision affirming DWD's determination based on application of the doctrine of issue preclusion. The ALJ found that the record established that all of the individuals at issue in the case performed services similar to those performed during 2001 and that those services were performed under similar circumstances.  LIRC's decision affirmed, holding that individuals at issue here did in fact perform services which were similar to those performed by the individuals addressed in the now-final 2003 commission decision, and that those services were performed under similar circumstances, such that issue preclusion applied.  South East then sought judicial review

Held: Affirmed.  Courts have applied issue preclusion to unreviewed administrative agency decisions, as in Lindas v. Cady, 183 Wis. 2d 547 (1994).  While South East Cable argues that Amtronix v. LIRC, 115 Wis. 2d 108 (App 1983) stands for the proposition that administrative agency decisions are not given preclusive effect, the court rejects this argument.  Amtronix is distinguishable, because in that case the relevant issue had not been litigated in a previous action. The court therefore relies on Lindas.  The fact that the previous decision in this case became final because South East Cable made a procedural error in commencing the review action, is not a reason to not apply issue preclusion.  Applying the factors commonly looked to in deciding whether issue preclusion should be applied, the court finds that it is appropriately applied here.   There is sufficient credible evidence that the individuals whose status is at issue here performed very similar services as those individuals whose work was addressed in the initial matter. This was effectively conceded by South East Cable at the hearing.  There was no change in several key factors relating to employee status.

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

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