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

Subject: Milwaukee Transport Services, Inc v. Labor and Industry Review Commission and Cornelius Hall (Hrg. No. 95603339MW), Case 96 CV 000989 (Wis. Cir. Ct., Milwaukee Co., August 21, 1996)

Digest Codes: MC 626    MC 676  MC 676.2

The employe, a bus driver, was first discharged for excessive absences. The employee's union filed a grievance on the employe's behalf, and within a few weeks a "Reinstatement Agreement" was entered into pursuant to which the employe was placed on referral to the EAP program and made eligible to resume his employment in certain non-driving positions. None of them were open at the time, so he did not work. He returned to driving after approximately 2 months. In the interim he sought UC benefits. The employer argued that he had been discharged and was subject to the misconduct disqualification.

The commission's decision found that what had occurred was a disciplinary suspension, rather than a discharge. As a result, the disqualification imposed on the employe was only that resulting from a finding of good cause for suspension.

On appeal to circuit court, the employer argued that there had been a discharge, not a suspension, and that it was error to conclude that the discharge could be "converted" into a suspension by a subsequent reemployment agreement.

Held: Affirmed. The commission has had significant experience dealing with the issue of whether a discharge may be treated as a suspension under Wis. Stat. 108.04, and therefore its decision will not be reviewed under a de novo standard, but will be upheld as long as it has a rational basis and is supported factually by credible evidence.

Although Roberts v. Ind. Comm., 2 Wis. 2d 399 (1957), reflects the principle that compensation eligibility cannot be affected by private agreements, that decision is distinguishable.  This case does not involve the same policy issue.  While in Howard v. Riteway Bus Service (LIRC, Jan. 29, 1993), the commission stated that "[t]he employe's separation cannot be converted from a discharge to a disciplinary suspension, after the fact", that case involved a different factual scenario. In Howard, there was no agreement, conditional or otherwise proven to exist that would have changed the discharge to a suspension. There was evidence that the employee was discharged and that the employee later asked the employer if it would consider rehiring him and the employer agreed. It was not clear in that case, that the discharge had been rescinded;  here, there was.  In Washington v. Gardner Baking Co. (LIRC, Oct. 15, 1990), and Petska v. Eau Claire La Crosse X Embers Mgt. Acct (LIRC, Aug. 12, 1994), the facts were more similar to those here, in that there was a discharge and then an express indication that the discharge was rescinded and converted to a suspension.  There was ample evidence in this case that the discharge was rescinded and that the period of separation was considered to be a suspension.

Finally, the employer’s alternative argument that the employe was ineligible anyway because he was unavailable for work, is rejected because the employer did not clearly raise it at hearing and did not argue it to the commission.

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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