Nelson v Robot Support, Inc. – 12.160

Nelson v Robot Support, Inc.
Digest No. 12.160

Section 421.29(1)(b)

Cite as: Nelson v Robot Support, Inc, unpublished opinion of the Macomb County Circuit Court, issued October 3, 2017 (Docket No. 17-0123-AE).

Court: Circuit Court
Appeal pending:No
Claimant: Lisa Nelson
Employer: Robot Support, Inc.
Date of decision: October 3, 2017

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HOLDING: Excessive absences beyond a claimant’s control do not constitute the basis for misconduct. A claimant’s use of text messaging, instead of telephone, to communicate with his or her employer regarding the absences also does not constitute misconduct.

FACTS: Claimant was employed by Robot Support as an administrative assistant. Claimant left work in April 2016 to care for her mother, who was ill. During that time, Claimant also became ill and ended up missing 19 consecutive days of work. During that absence, Claimant sent her employer text messages to keep it updated. When Claimant returned to work, she was fired.

DECISION: It is well established that excessive absences beyond a claimant’s control do not constitute the basis for misconduct. Washington v Amway Grand Plaza, 135 Mich App 652, 658 (1984). It was contrary for law for the ALJ in this case to state that Claimant’s excessive absences were disqualifying misconduct, when really it based his decision on the fact that Claimant communicated her need for absences via text message instead of telephone.

RATIONALE: The ALJ’s findings of fact–that Claimant never communicated with her employer regarding the severity of her situation or the need for leave and sent updates to her employer via text–are supported by material and competent evidence. Claimant submitted medical documentation proving that her absences were beyond her control because both she and her mother were ill.

However, the ALJ based its decision on the lack of communication about the absences, not the absences themselves. The ALJ reasoned that it was disqualifying misconduct for Claimant to not call her employer during her extended absence. The Circuit Court held that the ALJ erroneously applied the law to the facts because, according to its decision, Claimant wasn’t terminated for her alleged misconduct, but rather her failure to communicate by telephone. The employer did not have a written policy requiring employee communications by telephone, and Claimant had in the past communicated with her employer via text. The Circuit Court held the decision of the ALJ contrary to law and reversed the decision of the MCAC, which affirmed the ALJ’s decision disqualifying Claimant from receiving benefits.

Digest author: Sarah Harper, Michigan Law, Class of 2017
Digest updated: December 26, 2017

Bryan-Brooks v Securitas Security Services – 18.24

Bryan-Brooks v Securitas Security Services
Digest No. 18.24

Section 421.62(a)

Cite as: Bryan-Brooks v Securitas Security Services USA, Inc, unpublished opinion of the Wayne County Circuit Court, issued September 11, 2017 (Docket No. 17-005155).

Court: Circuit Court
Appeal pending: Yes
Claimant: Christina Bryan-Brooks
Employer: Securitas Security Services USA, Inc.
Date of decision: September 11, 2017

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HOLDING: Claimants that meet the statutory requirements to receive a hardship waiver aren’t disqualified from receiving the waiver if they fail to completely fill-out the waiver application on the first try.

FACTS: Claimant received unemployment benefits that were not actually due to her, through no fault of her own. The Agency requested restitution in the amount of the overpayment, but Claimant was unable to pay. She filed a hardship waiver application with the Agency to waive the restitution.

Section 62(a) requires the Agency to approve hardship waivers for claimants who prove they are below the federal poverty line. The Agency denied her hardship waiver because the application was incomplete. Specifically, the Agency said she failed to list her daughters’ social security numbers and attached pay stubs instead of listing her income on the application form.

Claimant appealed the Agency’s denial of her hardship waiver application. She presented evidence at a hearing in front of an ALJ that proved she was below the federal poverty line for a family of four. The ALJ nevertheless affirmed the denial because her failure to provide the requested information “deprived the UIA of the opportunity to analyze whether or not [Claimant’s] income fell below the poverty line guidelines.” The MCAC affirmed.

DECISION: Under § 62(a) the Agency is required to waive restitution if the claimant is below the poverty line. If a claimant proves he or she qualifies for the waiver, the claimant cannot be denied the waiver because they fail to correctly complete the application.

RATIONALE: The MESA is a remedial act designed to safeguard the general welfare through the dispensation of benefits to those that become involuntarily unemployed. If the court followed the reasoning of the Agency, ALJ, and MCAC, it would have to deny a hardship waiver to a claimant that proves he or she is eligible, simply because the claimant’s application is incomplete. “Such a finding does not give the [Agency] any incentive to offer guidance to offer guidance or follow up with waiver applicants with respect to adequate completion of paperwork, and is contrary to the act’s purpose.”

The Agency tried to introduce evidence for the first time on appeal that Claimant was, in fact, above the federal poverty line. The court rejected that argument because the Agency failed to raise the issue at the ALJ hearing. The court further noted that the hardship waiver application form is poorly written and did not inform claimants that they could amend their hardship waiver instead of appealing.

Digest author: Sarah Harper, Michigan Law, Class of 2017
Digest updated: December 5, 2017

 

Mendoza v. Aerotek, Inc. – 12.159

Mendoza v. Aerotek, Inc.
Digest No. 12.159

Section 421.29(1)(m)

Cite as: Mendoza v Aerotek, Inc, unpublished opinion of the Michigan Compensation Appellate Commission, issued August 18, 2017 (Docket No. 17-004211-252718W).

Court: Michigan Compensation Appellate Commission
Appeal pending: No
Claimant: Pedro Mendoza
Employer: Aerotek Incorporated
Date of decision: August 18, 2017

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HOLDING: The Michigan Compensation Appellate Commission (MCAC) reversed an Administrative Law Judge (ALJ) order finding Claimant disqualified for benefits under the “testing positive for drug use” provision of Section 29(1)(m).  The Commission held that under Ashford v Unemployment Compensation Commission, 328 Mich 428, 433 (1950), the employer did not meet its burden of proof where it failed to appear, and thus no prima facie case was established to prove the misconduct.  Therefore, the Commission reversed the order and found Claimant eligible for benefits.

FACTS:  The Agency found Claimant disqualified for benefits under the misconduct provision of MES 421.29.  Here, Claimant tested positive for drug use on an employer-administered drug test and thus was found ineligible under the illicit drug use provision of Section 29(1)(m).  At the hearing, the only participants present were Claimant’s attorneys and the judge.  Despite the employer’s lack of appearance, the judge affirmed the Agency’s finding of disqualification and held Claimant ineligible for benefits.  The MCAC reversed on appeal.

DECISION: The Commission reversed the ALJ order and found Claimant not disqualified for benefits under Section 29(1)(m).

RATIONALE: The Commission found that because the employer had the burden of proof to establish misconduct, its failure to appear at Claimant’s hearing and present evidence to support a finding of misconduct failed to meet the burden of proof.  Because no prima facie showing of misconduct could be established without the employer’s presence, the Commission held that the ALJ erred in affirming the Agency’s finding of misconduct.  Further, Claimant had no burden of proof in this case, and had only the obligation to prosecute his appeal under Ashford.  Because the employer failed to meet its burden of proof by not appearing at the hearing, and because Claimant had no burden of proof under Section 29(1)(m), the order was reversed and the Commission found Claimant not disqualified for benefits.

Digest author: Laura Page, Michigan Law, Class of 2018
Digest updated: January 2, 2018

 

Saylor v. C.L. Rieckhoff Co. – 16.95

Saylor v. C.L. Rieckhoff Co.
Digest No. 16.95

Section 421.62

Cite as: Saylor v C L Rieckhoff Co, unpublished opinion of the Michigan Compensation Appellate Commission, issued August 2, 2017 (Docket No. 16-029832-252337W).

Court: Michigan Compensation Appellate Commission
Appeal pending: No
Claimant: Brian Saylor
Employer: C.L. Rieckhoff Co.
Date of decision: August 2, 2017

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HOLDING: The Michigan Compensation Appellate Commission held that the Agency must have an employer protest and a determination of eligibility before it can initiate a fraud investigation. Further, the Commission held that a benefit check determination of eligibility under 32(f) is not a sufficient predicate determination to issue a 62(a) fraud determination.

FACTS: Claimant had received benefits and the Agency issued him redeterminations accusing him of committing fraud. He was required to repay the amount received in benefits plus penalty. The Agency did not receive an employer protest, but rather issued the redetermination on its own motion.

The Agency argued that the benefit check determinations under 32(f) of the Act were sufficient to allow it to issue redeterminations. The Commission disagreed.

DECISION: The Commission’s decision rested on procedural due process. It decided that the method employed by the Agency in issuing the redetermination violated Claimant’s due process rights.

RATIONALE: The Commission’s decision stemmed from both a statutory construction of the MESA, due process, and the Michigan Administrative Procedures Act. The Commission found that 32(f) did not provide the basis for redeterminations finding fraud; rather, a separate determination of ineligibility needed to occur before a 62(a) redetermination of fraud could be found. Further, because there was no initial determination to serve as the foundation for the redetermination, the issuance of the redeterminations were procedurally deficient. The Commission reasoned that the MAPA required it to set aside the redeterminations regardless of whether Claimant timely appealed, as they were issued erroneously.

The Commission further noted that the Agency did not have the ability to issue redeterminations without an employer protest outside of the time frame prescribed by section 32a of the Act.

Digest author: Travis R. Miller, Michigan Law, Class of 2018
Digest updated: January 2, 2018

 

Bauserman v Unemployment Insurance Agency – 20.09

Bauserman v Unemployment Insurance Agency
Digest No. 20.09

MCL 600.6431

Cite as: Bauserman v Unemployment Insurance Agency, unpublished decision of the Court of Claims, entered May 10, 2016 (Case No. 15-000202-MM).

Bauserman v Unemployment Insurance Agency, unpublished opinion per curiam of the Court of Appeals, issued July 18, 2017 (Docket No. 333181).

Court: Court of Claims and Court of Appeals
Appeal pending: Yes
Claimant: Bauserman
Employer: N/A
Date of decision: May 10, 2016; July 18, 2017

View/download the full Court of Claims decision

View/download the full Court of Appeals decision

View/download the full complaint

HOLDING: The Court of Claims held that the Agency’s motion to dismiss was denied because plaintiffs complied with the notice provisions of MCL 600.6431, the Court has subject matter jurisdiction, and the plaintiffs’ claims are not barred by governmental immunity.

The Court of Appeals reversed the Court of Claims holding. The case was remanded for entry of an order granting summary judgment for the Agency

The matter is currently under review by the Michigan Supreme Court.

FACTS: Named plaintiff was terminated from his employment and applied for unemployment benefits. He received benefits for a over a year. While he was receiving benefits, he received from his former employer a lump sum deferred payment of his pro rated bonus from the previous year, which he earned prior to his termination. MIDAS detected a discrepancy and concluded that plaintiff received benefits while he was earning income.

The UIA sent a request for information relative to ineligibility or disqualification to plaintiff’s online MiWAM account, however he was not checking the account as he was no longer receiving benefits at the time. When he finally saw the message months later, he began writing to the Agency to explain the lump sum. The Agency never responded.

Eventually, they notified plaintiff that he had been overpaid benefits and would be assessed a penalty. Plaintiff again contacted the Agency explaining the bonus. Then the United States Department of Treasury notified plaintiff that his federal income tax refund had been seized by the State of Michigan to collect on his unemployment debt. Similar action was taken by the State of Michigan Treasury.

Finally, Plaintiff received a redetermination that its earlier fraud determination was null and void. Plaintiff had filed a complaint in the Court of Claims alleging that the Agency’s fraud detection program, and its collection and seizure of assets, violated the due process clause of the Michigan Const 1963, Art 1, § 17.

DECISION: The Court of Claims decided that plaintiffs’ causes of action did not accrue when Agency first notified them of their liability for unemployment but rather when the Agency issued a redetermination which concluded that the plaintiff had not received UIA benefits fraudulently. The administrative process fails to afford sufficient relief to plaintiff’s challenging an entire statute and policy, therefore a constitutional court claim is viable and there is no governmental immunity.  The Agency’s motion to dismiss on lack of standing is denied.

The Court of Appeals decided that the plaintiffs’ cause of action accrued when “the wrong on which they base their claim was done.” The Court decided the garnishment of wages and interception of tax returns was not the initial event given rise to their claim. Rather, when the Agency issued notices of its determinations and the plaintiffs were not given requisite notice or opportunity to be heard was the initial wrong.

RATIONALE: The Court of Claims found that the plaintiffs’ causes of action did not accrue when the Agency first notified them of their liability for unemployment benefits and penalties, but much later. The causes of action accrued when the Agency issued a redetermination that concluded that plaintiffs had not received UIA benefits fraudulently. At the time the Agency issued the redetermination, then plaintiffs could fully allege the elements of the claim. The amended complaint was filed within six months of the redetermination dates, therefore the plaintiffs complied with statutory requirements.

Furthermore, the Court found that the administrative process by which the plaintiffs could appeal within the Agency failed to afford sufficient relief to plaintiffs wishing to challenge the entire statutory and policy scheme. Therefore the Court found no governmental immunity existed in this case.

The Court of Appeals found that the forfeiture of monetary assets was the damage resulting from the wrongful conduct of the Agency and therefore did not rise to the event given cause for a claim. The Court said this is consistent with the Michigan Supreme Court’s recent decision in Frank v Linkner, 894 NW2d 574 (2017) where the court held that the plaintiffs’ argument “conflates monetary damages with harm.” Frank involved a shareholder oppression action not an unemployment benefits action.

Since the parties did not dispute the date of named plaintiff’s notices of redetermination were December 3, 2014, the action filed on September 9, 2015 is well beyond the six months following the event that gave rise to the cause of action.

Digest author: Sara Posner, Michigan Law, Class of 2017
Digest updated: December 5, 2017

 

Lawrence v Michigan Unemployment Insurance Agency – 16.96

Lawrence v Michigan Unemployment Insurance Agency
Digest No. 16.96

Section 421.33

Cite as: Lawrence v Mich Unemployment Ins Agency, 320 Mich App 422 (2017).

Court: Court of Appeals
Appeal pending: No
Claimant: Suzanne Lawrence
Employer: Bloomfield Hills Country Club
Docket No.: 332398
Date of decision: July 11, 2017

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COURT OF APPEALS HOLDING: The claimant does not have the burden to prove that she did not receive benefit checks.

FACTS: Claimant worked for a country club and was laid off for the winter season. Claimant  was paid vacation time for the first weeks of the lay off. The Agency alleged that Claimant received benefits during those weeks and is required to pay restitution ($158). Claimant denied receiving benefits during those weeks. Claimant appealed the lower decisions as misconstruing the case: the lower decisions referred to eligibility, but Claimant argued that the case is about whether she received any payment during the ineligible weeks.

DECISION: Reversed. The courts focused on the wrong issue: it was not whether Claimant was eligible but rather whether she received payment on the ineligible weeks; and there was error in affirming MCAC and in its factual determinations, misapplying the substantial evidence test.

RATIONALE: The ALJ “bewilderingly” focused consideration on eligibility during the weeks Claimant “conceded she was ineligible.” (Emphasis in original.) The ALJ decision lacks legal grounds because eligibility was not at issue. MCAC “completely missed the mark” by not overturning because the issue on appeal was whether the ALJ addressed the appropriate issue.

The circuit court erred when when it determined that MCAC’s decision was supported by competent, material, and substantial evidence. The notices of restitution and the determination were “not proof that the MUIA issued an overpayment, in any amount, to [Claimant], and to accept them as such would defy common sense.” Without a scintilla of evidence to support the payments, the circuit court erred by affirming MCAC’s decision as supported by competent, material, and substantial evidence. Claimant did not have the burden to establish that she did not receive benefits as alleged. Claimant would need to rebut evidence by the Agency, but it is not her burden in the first instance. This avoids Hodge because the circuit court did not need to substitute its judgment on credibility for the ALJ’s; the ALJ simply did not make a contrary factual finding.

Digest author: Benjamin Tigay, Michigan Law, Class of 2018
Digest updated: January 2, 2018

 

Cotton v. Express Employment Professionals – 16.93

Cotton v. Express Employment Professionals
Digest No. 16.93

Section 421.62

Cite as: Cotton v Express Employment Professionals, unpublished opinion of the Maycomb County Circuit Court, issued June 5, 2017 (Docket No. 2016 -4047-AE).

Court: Macomb County Circuit Court
Appeal pending: Yes
Claimant: Yvette Cotton
Employer: Express Employment Professionals
Date of decision: June 5, 2017

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HOLDING: The court found that the Agency lacked jurisdiction to issue a redetermination of the claimant’s “benefit check determinations” under 32a(2), which holds that the Agency must have good cause to reconsider a prior determination or redetermination after the 30-day period has expired and must re-open within a year of the previous determination. The court therefore found it unnecessary to address the timeliness of the claimant’s subsequent protests.

FACTS: Claimant had received benefits and the Agency issued her redeterminations accusing her of committing fraud. She was required to repay the amount received in benefits plus penalty. The Agency did not receive a timely employer protest, and the employer did not show good cause for issuing a late protest.

The Agency argued that the benefit check determinations under 32(f) of the Act were sufficient to allow it to issue redeterminations. The Court disagreed.

DECISION: The Court’s decision rested on procedural due process. It decided that the method employed by the Agency in issuing the redetermination violated claimant’s due process rights. The court remanded for further proceedings to determine the basis for the determinations, but noted it did not need to reach Claimant’s good cause for late appeal, as the redeterminations were issued erroneously.

RATIONALE: The court’s decision stemmed from both a statutory construction of the MESA and due process. The court demurred the Agency’s contention that section 62 of the Act gave it authority to issue determinations and redeterminations. Rather, the court reasoned, MESA gives the Agency authority under 32a. This means that the Agency does not have broad, sweeping authority, over the course of three years, to make determinations and redeterminations. They must do so within the parameters of 32a and 32.

The court made clear that the deficiencies in the Agency’s process meant the court did not need to address Claimant’s good cause for reopening.

Digest author: Travis R. Miller, Michigan Law, Class of 2018
Digest updated: January 2, 2018