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

Subject: Wisconsin Department of Workforce Development v. LIRC, Nikki L. Wallenkamp and Arby’s Restaurants, No. 2015AP716, unpublished slip op. (WI App Feb. 2, 2016).

Please note that Wis. Stat. § 809.23(3) provides that, except as allowed therein, an unpublished decision of the Court of Appeals is of no precedential value and for that reason may not be cited in any court in this state as precedent or authority. Summaries of unpublished Court of Appeals decisions are included in this collection as an informational service only, and their use contrary to 809.23(3) is not encouraged.

Digest Codes: BR 317 BR 330

The employee worked for the employer, a fast-food chain, and filed claims for partial benefits. Beginning in week 43 of 2012, the DWD’s automated telephone claim filing system asked: “During the week, did you work or did you receive or will you receive sick pay, bonus pay or commission?” Between week 44 of 2012 and 4 of 2013, the employee answered “No.” It was undisputed that the employee worked during the time period at issue, with the exception of week 4 of 2013. She received vacation pay for that week. DWD issued multiple determinations finding that the employee concealed work and wages, a quit, and vacation pay from the department when filing for benefits, resulting in an overpayment, overpayment penalties, and a reduction in future benefits. On appeal, an ALJ affirmed the department’s determinations.

The employee petitioned for commission review. LIRC reversed the ALJ’s decisions, finding that the employee was confused by the automated system’s compound question, did not understand how to file her claims properly, and did not intend to defraud DWD.  Wallenkamp v. Arby's Restaurants, UI Dec. Hearing No. 13607281MW and 13607282MW (LIRC, May 15, 2014).

DWD appealed to circuit court. The circuit court affirmed LIRC, concluding that LIRC’s interpretation and application of the statute concerning concealment is entitled to great weight deference. Wisconsin Department of Workforce Development v. Wisconsin Labor and Industry Review Commission, Nikki L. Wallenkamp and Arby's Restaurants, Case No. 14-CV-6402 (Wis. Cir. Ct., Milwaukee Cnty., Feb. 23, 2015).

DWD appealed to the court of appeals. DWD argued that the evidence of record did not support LIRC’s finding that the employee did not conceal facts pertaining to her employment and wages during the time period at issue and that LIRC misinterpreted and misapplied the statutory definition of “conceal.”

Held:   Affirmed. The court of appeals determined that LIRC’s decision was entitled to great weight deference, because (1) LIRC is charged with administering the concealment statute by virtue of its broad authority to review unemployment benefits decisions, (2) LIRC’s interpretation of the concealment statute is one of longstanding; (3) LIRC necessarily employed the expertise, specialized knowledge, and technical competence it has developed over the years; and (4) deferring to LIRC’s interpretation of the concealment statute provides uniformity in its application.

In concluding that LIRC’s findings of fact were supported by substantial and credible evidence in the record, the court of appeals noted that LIRC is the sole judge of the weight and credibility of the witnesses. LIRC considered multiple factors, including the employee’s testimony, in reaching its decision that the employee “was confused by the compound nature of the question” concerning whether she worked or received or would receive various forms of pay and that the employee genuinely misunderstood the unemployment insurance program.

The court of appeals found that LIRC’s interpretation and application of the concealment statute was reasonable and did not alter the statute’s meaning. The statute “unequivocally states that concealment requires an intent to mislead or defraud the DWD,” and a “determination that a claimant did not intend to mislead or defraud the DWD necessarily incorporates a determination that the claimant did not intend to seek unentitled benefits.” The employee’s mistaken filings were based upon confusion, not an intent to mislead or defraud the DWD.

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