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


Subject: Spector Freight System Inc. v. DILHR and Kaczmarek, Case No. 131-057 (Wis. Cir. Ct., Dane Co., May 10, 1971)

Digest Codes: MC 630.14  PC 714.11   PC 740 

The employee was arrested by the FBI on December 4, 1969, for theft of freight from an interstate shipment and was discharged immediately as a result of this arrest. Later the employee pleaded guilty to a reduced charge from a felony to a misdemeanor being originally charged with a theft of 36 coats and the reduction in the charge was accomplished by changing the quantity of coats charged to have been stolen to one coat as he had agreed to talk to the FBI giving information on four or five others charged with theft.

Held:  Although at the time of discharge the employer did not have actual knowledge that the employee had stolen the coats and had relied on the results of the FBI investigation that underlay the charge for which the employee was arrested, it would appear to the court to be an unreasonably restrictive and unrealistic interpretation to construe the letter of discharge as stating the ground was solely the arrest apart from the employee's participation in the offense charged. This court is unaware of any requirement that the employer must possess personal knowledge of facts constituting the ground for discharge for misconduct at the time the discharge takes place. The employer did then know at the time of discharge that the FBI had conducted an investigation into thefts of freight entrusted to it for safe shipment and that the employee had been arrested for stealing goods so entrusted to it upon charges made by FBI agents. By the time the hearing took place by the appeal tribunal, the employee's misconduct for which he was discharged was conclusively established by his admission that he had pleaded guilty to stealing one coat and that he knew what he had done “was not right.”  

Where, as here, an employer discharges an employee at the time of arrest for an offense which, if proved, would constitute misconduct of the employee connected with his employment without the employer having personal knowledge of facts establishing guilt, the employer runs the risk of having to pay the employee unemployment compensation if the employer is later unable, to establish by competent proof that such offense was in fact committed. Benefits denied

 


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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