P O BOX 8126, MADISON, WI 53708-8126



Hearing No. 14000528MD

An administrative law judge (ALJ) for the Division of Unemployment Insurance of the Department of Workforce Development issued an appeal tribunal 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 agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own, except that it makes the following modifications:

1. In the fourth sentence of the third paragraph of the ALJ's FINDINGS OF FACT and CONCLUSIONS OF LAW, delete the phrase "made it appear that the customer had more revenue than actual" and replace it with "overstated the employer's revenue".

2. Delete the eleventh, twelfth and thirteenth paragraphs of the ALJ's FINDINGS OF FACT and CONCLUSIONS OF LAW, and replace them with the following:

The first written warning the employee received, on January 3, 2014, was for recording a bank fee in only two of the three accounts in which it was supposed to be recorded, which led to an overdraft by the employer. The second warning, on January 10, 2014, was based on a mistake made by the employee about six months earlier, in which the employee deposited a client's check for association dues into the wrong account, leading to some confusion in January 2014 about whether the client had paid its dues. Because the error noted in the second warning had occurred months before the first warning was issued, it did not constitute a repeated failure following the first warning.

It did, however, constitute a repeated error following a number of attempts by the employer to improve the employee's job performance. The employer characterized the employee's errors as part of a long-term pattern of making mistakes by not following procedures. After the employee's first 90 days on the job, the employer noted that the only need for improvement was to eliminate mistakes by slowing down and double-checking her work. The same shortcoming was noted in coaching sessions for the employee in March and April 2013. In both the employer's January 2014 warnings, the employer made reference to this history of errors.

The employee's final mistake was to enter amounts owing by customers for utilities on or about January 13, 2014, which was about two weeks after she had already entered these amounts in a different account. It would have been proper to enter the amounts in one account or the other, but not in both. This mistake was the result of either the employee's failure to remember that she had already entered the amounts in late December, or her misunderstanding of the reason why she should use only one account or the other. The employee was mystified as to why she entered the utility billings twice.

Although the employee fell short of the employer's reasonable requirements by her acts or omissions over which she exercised reasonable control, and such conduct might be considered substantial fault, the statute is written so as to relieve the employee from a finding of substantial fault if any one of the three statutory exceptions applies. In this case the second and third exceptions apply. The second exception is for "inadvertent errors." The employee's final mistake was inadvertent, and was not something about which she had been specifically warned. The third exception is for failure due to lack of skill, ability or equipment. The employee's history of accounting mistakes indicates that she never reached a level of competence in her job that satisfied her employer's expectations. The employer's notice of termination in fact cites incompetence as a reason for discharge. It also cites failing to respond to training and falsification of records; however, the failure to respond to training is attributed to a lack of skill and ability, and, as noted above, the employee was not shown to have falsified records.


The appeal tribunal decision, as modified, is affirmed. Accordingly, the employee is eligible for benefits, if otherwise qualified.

Dated and mailed June 27, 2014

campomi_umd . doc : 107 : MC  602.3 – Wis. Act 20 - § 108.04(5g)(a)3 – PC 710 – PC 730


/s/ Laurie R. McCallum, Chairperson

/s/ C. William Jordahl, Commissioner

/s/ David B. Falstad, Commissioner


In deciding that the employee's conduct in this matter did not amount to substantial fault, the appeal tribunal relied on North Carolina judicial interpretations of a substantial fault provision that existed in North Carolina's unemployment insurance law. The commission has excised that part of the appeal tribunal's decision. Wisconsin appellate courts have "rejected the argument that Wisconsin courts should look to other jurisdictions', federal or other state courts, interpretations of unemployment compensation acts to interpret Wisconsin's unemployment compensation act." Bernhardt v. LIRC, 207 Wis.2d 292, 302, 558 N.W.2d 874 (Ct. App. 1996), citing Moorman Mfg. Co. v. Indus. Comm'n, 241 Wis. 200, 207, 5 N.W.2d 743 (1942) ("We do not perceive that it matters how courts of other states have construed their unemployment acts even though they are duplicates of or based upon our own.").

Wisconsin Stat. § 108.04(5g) excludes from the concept of substantial fault "[o]ne or more inadvertent errors made by the employee." The commission takes this exclusion to refer to one or more unintentional acts or omissions by the employee that are properly described as errors, as opposed to infractions of rules, which is the subject of the first exclusion. In this case, the employee's mistakes are in the nature of mistakes in the performance of her job, which were best characterized as errors, not specific rule violations.

The substantial fault definition also excludes "[a]ny failure of the employee to perform work because of insufficient skill, ability, or equipment." Id. In this case, the employee's insufficient skill or ability is evidenced by the fact that from the beginning of her employment she had difficulty avoiding mistakes in her bookkeeping duties, and did not demonstrate an ability to improve substantially in the seventeen months of her employment. The record does not support a conclusion that the employee's failure of performance was due to a lack of effort. An employee's failure, despite her best efforts, to possess or acquire the skills necessary to consistently meet an employer's expectations, is excluded from the definition of substantial fault.


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

uploaded 2014/07/22