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

Subject: June E. Powers v. Industrial Commission and Endocrine Laboratories of Madison, Inc., Case No. 119-483 (Wis. Cir. Ct., Dane Co., April 4, 1967)

Digest Codes: VL 1007.20

On August 31 the employee informed her employer she had accepted an offer of work with another employer but did not then have a definite date when she would leave to go to that other job. By September 8 the employee could still not provide the employer with a definite date, but said it would not be later than October 1.   Around September 15 the employer said it could not continue to have the matter indefinite and suggested September 30 as a last day of work, and the employee agreed to this.   Then on September 28 or 29, the employee told the employer she wanted to continue in employment after September 30, until her new job materialized.  The employer would not agree, and the employee's employment ended on September 30.  The Appeal Tribunal found a quit as of September 30, and the Commission affirmed this decision.  The employee appealed to Circuit Court.

Held:  The commission's decision is affirmed.  There was credible evidence in the record supporting the finding that the employee did tell her employer she was quitting, and that she did indeed agree with her employer to date of September 30 as her last day.  The issue then becomes whether after so agreeing the employee had the right to change her mind and continue her employment. 

"Counsel for the applicant argues that applicant may have agreed to quit as of September 30th for the convenience of her employer but that she had a right to change her mind prior to that date and continue on until she either quit or was discharged. In support of this argument counsel points out that applicant's replacement was actually hired before the alleged agreement as to a termination date was reached on September 15th or 16th. Actually, the decision reached by the commission is somewhat unfortunate from an equitable standpoint. In other words, applicant had a perfect right to seek a better job and it was entirely proper for her to advise her employer that a new job was in the offing. In addition, under the law she could have told her employer that she intended to stay on until such time as she actually could start on the new job. Under such circumstances the employer's only recourse would have been to have discharged the applicant once a replacement had been selected and trained. Under such circumstances applicant obviously would have been entitled to unemployment compensation benefits during the interim between her discharge and the actual date on which she started her new employment.

"Rather than following the course outlined above, applicant here sought to cooperate with her employer by indicating an approximate date on which she expected the new employment to materialize. Unfortunately from applicant's standpoint she tied that approximate date down to an agreed date of termination, i.e. , September 30, 1965. Once an agreement had been reached as to a termination date that ended the employment contract, and as we have previously indicated there is evidence in the record to support such an agreement. The law is quite clear that once an employment contract has been terminated any new contract of employment must be agreed to by both sides.

"Here, that did not occur. Admittedly on or about September 28th applicant went to her employer and stated that she wished to continue working as her new job had not yet materialized. This in effect was an offer on the part of the applicant to renew the employment contract. However, this offer was flatly rejected by the defendant employer and therefore no new employment contract was ever effectuated.

"An examination of the cases decided by our commission and collected in the 1960 Digest of Wisconsin Unemployment Compensation Cases at pp. 582-587 clearly support the proposition that where an employee agrees to quit his employment as of a certain date it thereby terminates his employment contract even though he later requests to continue on as an employee.

"A case on this precise point was decided by Branch No. 2 of the Circuit Court for Dane County, the Hon. Edwin M. Wilkie, pre-siding, in January of 1958. See Schallock vs. Ind. Comm. and Sprague Elec. Co., January 28, 1958. In that case judge Wilkie stated as follows:

". . . It has long been established that the voluntary resignation of an employee, evidenced by a clear expression of the employee's intention to quit the employment, promptly and unconditionally accepted by the employer, before the resignation is withdrawn by the employee, terminates the contract of employ-ment. "

"It is further clear that once the employment contract has been terminated the employment relationship can be renewed only by the making of a new contract. In Labatt, Master & Servant, 2nd Edition, Vol. 1, Section 182 at p. 570, the author states:

"The obligation of a contract of hiring is entirely destroyed, so far as ordinary incidents are concerned, when the parties have once consented to its dissolution, even though one of them may have withdrawn his consent a few minutes after it was signified. The servant, if he resumes work, will be presumed to do so under a new contract of the same tenor as the original one. " (Emphasis Supplied.)

Although neither the Wisconsin Supreme Court nor any other state high court has decided this precise question, intermediate appellate courts of other jurisdictions have uniformly ruled that where an agreement terminating a worker's employment has been reached the worker is thereafter estopped from changing his mind, particularly where the employer, as here, has incurred a liability by engaging a new employee and expending money to train such employee.

Although the result here may seem a bit harsh the law, in our judgment, is quite clear. In other words, once an employee has agreed upon a termination date he cannot thereafter alter such date without the full assent of his employer, which obviously was not here forthcoming. The commission's decision, therefore, must be confirmed.

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

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