Krauseneck v Department of the Army – 20.07

Krauseneck v Department of the Army
Digest no. 20.07

Section 20

Cite as: Krauseneck v Dep’t of the Army, Tuscola Circuit Court, No. 03-21657-AE (February 3, 2004).

Appeal pending: No
Claimant: Kyle J. Krauseneck
Employer: Department of the Army
Docket no.: B2002-15115-RO1-166448W
Date of decision: February 3, 2004

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CIRCUIT COURT HOLDING: When a person is honorably discharged from military service before completing 365 days or more of continuous service, and that individual was discharged for being medically unfit, he or she is eligible for benefits. But if the reason for the honorable early discharge had been failure to meet physical standards, i.e. height, weight or physical fitness, then the person would be ineligible for benefits.

FACTS: Claimant was honorably discharged from the Army after serving six months of active duty. The Army discharged claimant for failing to meet “procurement medical fitness standards.” Claimant filed for benefits.

DECISION: Claimant was discharged because of a medical disqualification pursuant to 20 CFR 614.2(2)(ii)(B).

RATIONALE: In cases involving individuals whose credit weeks are based on service in the military, the military determines who is and who is not eligible pursuant to Section 11(h). Pursuant to 20 CFR 614.2(2)(ii)(D) an honorably discharged service member is eligible for benefits for “inaptitude” if the service was continuous for 365 days or more. Pursuant to 20 CFR 614.2(2)(ii)(B), a service member discharged for completing his terms of active service because of “medical disqualification” is eligible for benefits without having to have served 365 days or more. In this case, the claimant underwent a medical examination by a physician, and the physician determined that claimant was medically unfit for further service under the Army’s medical fitness standards. This case does not involve the claimant’s failure to meet the Army’s physical fitness standards or failing to meet the physical height and weight standards. The term ‘Physical Standards’ under 5 USC 8521(a)(1)(B)(ii)(IV) refers to the “basic height, weight and fully bodied entrance requirements plus the basic physical fitness requirements as measured by the Army’s bi-annual APFT and not to the findings by Army medical personnel as to whether [a service member] is medically unfit for continued service.”

Digest Author: Board of Review (original digest here)
Digest Updated: 11/04

C & L Leasing Co v State of Michigan, BW&UC – 20.08

C & L Leasing Co v State of Michigan, BW&UC
Digest no. 20.08

Section 41

Cite as: C & L Leasing Co v State of Michigan, BW&UC, Macomb Circuit Court, No. 02-4341-AE (March 11, 2003).

Appeal pending: No
Claimant: N/A
Employer: C & L Leasing Company
Docket no.: L2001-00056-RO1-2795
Date of decision: March 11, 2003

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CIRCUIT COURT HOLDING: An employer will not be considered to be an “employee leasing company” unless the employer satisfiesall of the requirements of UA Rule 190.

FACTS: Employer’s (C & L) secretary/treasurer testified that employer performed payroll services and provided employees to two other companies, Michigan Awning and Panel Laminations. Ownership of the three companies was intertwined among various family members and in-laws. Employer’s business and Michigan Awning operated out of employer’s secretary/treasurer’s residence. Employer’s secretary/treasurer’s husband and his parents had supervisory control over the employees.

DECISION: Employer is not an employee leasing company. Payroll of workers at the “client” companies is reassigned to the individual companies.

RATIONALE: To be eligible for employee leasing company status, an employer must satisfy all of the requirements of Rule 190. Employer failed to show it met the requirements of Rule 190(2). Employer did not “in fact” hire, promote, reassign, discipline and terminate the leased employees, as required by Rule 190(2)(b). Employer did not hold itself out to the general public as available to provide leasing services, as required by Rule 190(2)(f). Employer’s solicitation letter represented employer as in the business of providing payroll and administrative services.

Digest Author:  Board of Review (original digest here)
Digest Updated: 11/04

Waknin v Chamberlain – 20.06

Waknin v Chamberlain
Digest no. 20.06

Cite as: Waknin v Chamberlain, 467 Mich 329 (2002).

Appeal pending: No
Claimant: N/A
Employer: N/A
Docket no.: N/A
Date of decision: November 19, 2002

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SUPREME COURT HOLDING: A criminal conviction after trial is admissible as substantive evidence of conduct at issue in a civil case arising out of the same occurrence.

FACTS: Plaintiff Waknin brought a civil action against defendant Chamberlain for assault and battery. Defendant had been previously convicted of the assault and battery of plaintiff. The circuit court excluded evidence of defendant’s criminal conviction from the civil case on the basis of Wheelock v Eyl, 393 Mich 74 (1974), and MRE 403.

DECISION: The trial court abused its discretion in barring the admission of evidence of the defendant’s conviction by a jury.

RATIONALE: The rule of Wheelock, as it pertains to the use of evidence of a criminal conviction in subsequent civil cases, did not survive the adoption of the Michigan Rules of Evidence. MRE 403 provides that relevant evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice. Evidence is not inadmissible simply because it is prejudicial. In every case, each party attempts to introduce evidence that causes prejudice to the other party. It is only when unfair prejudice substantially outweighs the probative value of the evidence that the evidence is excluded. In this case, defendant had an opportunity and an incentive to defend himself in the criminal proceeding. That the defendant was found guilty beyond a reasonable doubt, a standard of proof greater than the preponderance of the evidence in the civil case, is highly probative evidence. Accordingly, the probative value of the evidence of the defendant’s conviction was not substantially outweighed by the danger of unfair prejudice.

The Court expressed no opinion regarding whether pleas of nolo contendere are admissible as substantive evidence in subsequent civil proceedings.

Editor’s Note: Also see Section 14 of the MES Act which indicates, in part, that decisions of a court of record which have become final “may be introduced into any proceeding involving a claim for benefits and the facts therein found and the . . .decisions therein made shall be conclusive unless substantial evidence to the contrary is introduced by or on behalf of the claimant.”

Digest Author:  Board of Review (original digest here)
Digest Updated: 1/04

Seligman & Associates, Inc v MESC – 20.03

Seligman & Associates, Inc v MESC
Digest no. 20.03

Section 44(2)

Cite as: Seligman & Assoc, Inc v MESC, No. 85110 (Mich App May 6, 1987).

Appeal pending: No
Claimant: N/A
Employer: Seligman & Associates, Inc.
Docket no.: N/A
Date of decision: May 6, 1987

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COURT OF APPEALS HOLDING: The value of lodging provided to resident caretakers for the convenience of the employer is not considered wages under the Act.

FACTS: The employer operates numerous apartment complexes. The employer provides rent-free apartments to the apartment caretakers and requires them to live on the premises to be available to handle tenant complaints that may arise.

DECISION: The employer is entitled to a refund of contributions paid based on inclusion of the value of the lodging in calculation of wages.

RATIONALE: The reasonable cash value of lodging is to be considered wages only if it is extended as full or partial remuneration for the services rendered. There is no showing that the lodging was intended as partial compensation for the employees.

“This interpretation of the definition of wages is consistent with the United States Supreme Court’s interpretation of the definition of wages under the Federal Unemployment Tax Act (FUTA) in Rowan Co, Inc v United States, 452 US 247, 101 S Ct 2288, 68 L Ed 2d 814 (1981). In Rowan the Supreme Court held that for the purposes of FUTA wages do not include the value of meals and lodging provided for the convenience of the employer.”

Digest Author:  Board of Review (original digest here)
Digest Updated: 12/91

Wiersma v. Michigan Bell Telephone Co – 9.05

Wiersma v. Michigan Bell Telephone Co
Digest no. 9.05

Section 28a

Cite as: Wiersma v. Michigan Bell Telephone Co, 156 Mich App 176 (1986).

Appeal pending: No
Tribunal: Michigan Court of Appeals
Appellant: Michigan Bell Telephone (employer)
Docket no.: B82 5578 84393
Date of decision: July 24, 1986

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COURT OF APPEALS HOLDING: Even though claimant failed to request to preserve credit weeks within 45 days, she made diligent attempts to file and was misled by the MESC. As such the MESC is estopped from denying her entitlement to preserve credit weeks.

FACTS: On 1-26-81 claimant was placed on an approved disability leave for back problems until 4-4-81. Claimant was then on 3 weeks vacation and subsequently began a pregnancy related disability leave. While on leave, claimant was told the employer was closing the office where she had worked. Claimant contacted the MESC by phone and twice in person and was informed she needed to be willing and able to work and be unemployed; and 10-1-81 was the last day she could file for benefits. Her child was born 9-27-81 and she was released to return to work 12-3-81. When claimant applied for benefits she was denied because of insufficient credit weeks. Despite opportunities before and after she applied, the MESC never explained to her about preservation of credit weeks.

DECISION: Claimant is entitled to preserve credit weeks under Section 28a.

RATIONALE: Claimant diligently sought to preserve her rights, but she was affirmatively misled by the MESC. “We hold, under the circumstances of this case, that the MESC cannot misinform a claimant in regard to her rights or the appropriate procedures to take and then deny her benefits because she did not know her rights or because she took inappropriate procedural steps.”

“Second, the MESC may be equitably estopped in this case. An equitable estoppel arises where: (1) a party by representations, admissions or silence induces another party to believe facts; (2) the other party detrimentally relies and acts on this belief; and (3) the other party will be prejudiced if the first party is allowed to deny the existence of the facts…. Information regarding a claimant’s ability to obtain benefits may well be considered a “fact” in this context where the bureaucracy of an administrative agency is involved.”

Digest Author: Board of Review (original digest here)
Digest Updated: 11/90

Oak Park Education Association, MEA/NEA v Oak Park Board of Education – 20.02

Oak Park Education Association, MEA/NEA v Oak Park Board of Education
Digest no. 20.02

Section 30 and 31

Cite as: Oak Park Ed Ass’n, MEA/NEA v Oak Park Board of Ed, 132 Mich App 680 (1984).

Appeal pending: No
Claimant: N/A
Employer: Oak Park Board of Education
Docket no.: N/A
Date of decision: March 6, 1984

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COURT OF APPEALS HOLDING: The Public Employment Relations Act is the dominant law regulating public employee labor relations and where there is a conflict between it and another statute the Public Employment Relations Act prevails diminishing the conflicting statute pro tanto.

FACTS: Oak Park Education Association and Oak Park School District negotiated a labor contract containing a salary provision which provided that the salary of a teacher recalled from summer layoff would be offset by the amount of unemployment benefits received during the summer layoff. When the district sought to enforce this provision, the Association sought to have the provision excised from the contract asserting that it was in violation of Section 30 of the MES Act which makes unemployment benefits inalienable by any assignment and Section 31 of the Act which makes invalid any agreement to waive, release, or commute an individual’s right to benefits.

DECISION: The trial court’s summary judgment for the District was affirmed.

RATIONALE: The Public Employment Relations Act requires parties to those contracts within its preview to bargain collectively with respect to wages. The provision in question concerns wages and was the subject of bargaining between the parties. The teachers were allowed to collect benefits when unemployed. The provision provides for a partial waiver of salary rather than a waiver of unemployment benefits. It did not require the teachers to waive, or in any way restrict, their rights under the MES Act.

Digest Author:  Board of Review (original digest here)
Digest Updated: 12/91

Askew v Macomber – 20.05

Askew v Macomber
Digest no. 20.05

Section 42

Cite as: Askew v Macomber, 398 Mich 212 (1976).

Appeal pending: No
Claimant: Carrie Askew
Employer: Alicia Macomber
Docket no.: N/A (This case arose under the Workers’ Compensation Act)
Date of decision: December 7, 1976

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SUPREME COURT HOLDING: The test of whether a person or business is liable for workers’ compensation benefits as the employer of a claimant is not a matter of terminology, oral or written, but of the realities of the work performed; control of the claimant is a factor, as is payment of wages, hiring and firing, and the responsibility for the maintenance of discipline, but the test of economic reality views these elements as a whole, assigning primacy to no single one.

FACTS: Carrie Askew claimed worker’s compensation benefits against defendants M. Alicia Macomber, the Second National Bank of Saginaw, and Michigan Mutual Liability Company. Mrs. Macomber, because of her advanced age, had entered into an agency agreement with the bank for the management of her property which authorized the bank to pay for Mrs. Macomber’s care. The bank hired the plaintiff as a practical nurse for Mrs. Macomber and the plaintiff was injured in the course of that employment.

DECISION: Alicia Macomber, not the bank, was the employer of Carrie Askew.

RATIONALE: The bank was operating pursuant to an express agency agreement. The employment of nurses was not an integral part of the bank’s business. The bank was not operating as a labor broker. Although the bank drafted the check for Carrie Askew’s wages, the funds came from the Macomber estate, a separate account. Although the bank discussed wages and hours with Carrie Askew and arranged the hiring of her for Mrs. Macomber, it took no part in the day-to-day control or supervision of Ms. Askew’s duties. There was no evidence of any intent by the bank to supervise or discipline Ms. Askew. The bank’s actions on behalf of Ms. Macomber were those of an agent on behalf of a principal.

Digest Author:  Board of Review (original digest here)
Digest Updated: 7/99