Wilcox v. Bay City American Legion 18 – 16.88

Wilcox v. Bay City American Legion 18
Digest No. 16.88

Section 421.33, Admin. Rules 792.11411(10), 792.11415(5), and 792.11431

Cite as: Wilcox v Bay City American Legion 18, 2015 Mich ACO 14-015959-244230W

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Appeal pending: Yes
Claimant: Deborah E. Wilcox
Employer: Bay City American Legion 18
Tribunal: Michigan Compensation Appellate Commission
Date of decision: August 31, 2015

HOLDING: An Administrative Law Judge’s (ALJ) encouragement to an unrepresented Claimant, who in good faith misunderstood the scope of the hearing, caused the claimant to withdraw her appeal. The ALJ did not explain to the Claimant the ramifications of withdrawing, which constitutes good cause to reopen the appeal.

FACTS: Claimant was employed by Dore and Associates but was laid off. During this period of unemployment, claimant accepted a part-time position as a bartender with American Legion, but broke her ankle outside of work shortly after accepting the position. On doctor’s orders, Claimant withdrew from her position and was disqualified under Section 29(1)(b) of the Michigan Employment Security Act for voluntarily leaving her position with American Legion. Claimant received a hearing on September 11, 2014 with Bay City American Legion 18 as the employer for the hearing. During the hearing, the unrepresented Claimant articulated that she did not understand why or how her employment with American Legion would affect her claim, which she believed was established based on income earned from Dore and Associates. The Administrative Law Judge (ALJ) suggested it was unnecessary for the claimant to pursue the matter and encouraged her to withdraw her appeal. The claimant followed the ALJ’s suggestion and withdrew her appeal. The ALJ never explained the ramifications of withdrawing an appeal. After obtaining representation, Claimant filed a request to the ALJ to reopen her appeal, arguing that a good faith misunderstanding of the scope of the hearing constituted good cause for reopening as ruled in Jaeger v. Sears, Roebuck and Co., Digest No. 1620. The ALJ denied the request, and the claimant appealed the denial.

DECISION: The ALJ erred in denying claimant’s request to reopen her appeal, and thus, the appeal has been reopened. The matter is remanded to the Michigan Administrative Hearings System for a new hearing with a different ALJ.

RATIONALE: Pursuant to Administrative Rule 792.11415(5), the Michigan Compensation Appellate Commission (MCAC) will only review an ALJ’s denial of a request for reopening if it decides there is good cause for reopening. Administrative Rule 792.11402(v) defines “good cause” as reliance on incorrect information from the agency, ALJs, the hearing system, or the MCAC. The ALJs failure to explain the ramifications of withdrawing an appeal to the claimant constitutes good cause under this rule, and thus, the appeal is reopened. If the MCAC grants a request for reopening, Administrative Rule 792.11431 requires the decision on the appeal to be decided according to the “record already made” at the initial hearing. Because the hearing featured no testimony or evidence, the claimant’s appeal must be remanded for a new hearing.

Digest Author: Sean Higgins, Michigan Law, Class of 2017
Digest Updated: 1/6/2016

Cross v Tri-Fecta, Inc – 10.121

Cross v Tri-Fecta, Inc
Digest no. 10.121

Section 29(1)(a)

Cite as: Cross v Tri-Fecta, Inc, Genesee Circuit Court, No. 12-98465-AE (June 27, 2013).

Appeal pending:
Claimant: Michelle H. Cross
Employer: Tri-Fecta, Inc.
Docket no.: 12-98465-AE
Date of decision: June 27, 2013

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CIRCUIT COURT HOLDING: When a claimant holds a part-time job and full-time job simultaneously, then voluntarily quits the part time position only to subsequently be terminated from her full-time position in a qualifying manner is not disqualified from unemployment benefits due to the voluntary quit of the part-time job.

FACTS: Claimant held two jobs simultaneously: a full-time position at Quality Roofing, and a part-time job as a waitress at Employer Tri-Fecta, Inc. Claimant left her job with Employer on April 10, 2009, leaving her with only her full-time position at Quality Roofing. However, shortly thereafter, she was let go from that job as well in a qualifying manner. Claimant applied for benefits, and a UIA determination found in her favor.

Employer appealed Claimant’s benefits, and the ALJ found in Employer’s favor due to an erroneous interpretation of the facts believing that Employer Tri-Fecta. was Claimant’s last employer. On appeal, MCAC noted the mistaken facts but still found for Employer because of voluntary termination from Employer Tri-Fecta. Claimant appealed to the Circuit Court.

DECISION: The MCAC decision is reversed, and Claimant is entitled to unemployment benefits.

RATIONALE: The court’s reasoning in this case is short and unusual, and provided here in its entirety: “In this case the factual findings of the ALJ cannot be determined to be conclusive. They were clearly in error. The Court further finds that the MCAC decision is in error. The MCAC reviews the findings and decisions of the ALJ. The decisions of the ALJ are to be accorded deference. Who can tell what the decision of the ALJ would have been had the ALJ known the facts as they really were? The Court finds that the review process in this case is entirely flawed. This Court has not been made aware of any appellate decision in the State of Michigan that upholds the results before me. The Court further finds the rationale and reasoning of the Kent County Circuit Court case cited by claimant to be persuasive. ”

Digest Author: Jack Battaglia
Digest Updated: 8/14

Bechill v. Benzie County Government Center – 10.98

Bechill v. Benzie County Government Center
Digest No. 10.98

Section 421.29(1)(a)

Cite as: Bechill v Benzie Co. Gov’t Ctr, Benzie Circuit Court, No. B 2007-21980-RM2-201487W (August 21, 2009).

Appeal pending: No
Claimant: Richard J. Bechill
Employer: Benzie County Government Center
Docket no.: 201487wh
Date of decision: August 21, 2009

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HOLDING: When a claimant voluntarily terminates his or her employment, a significant reduction in wages (via a reduction in work hours) constitutes good cause attributable to the employer as a matter of public policy.

FACTS: Claimant was a dispatcher at the Benzie County Sheriff’s Office. For the first five months of his employment, Claimant was working an average of 40 hours per week. Over the summer, as a result of a myriad of factors, Claimant voluntarily worked an average of 18.25 hours per week. When Claimant saw that he was only scheduled for 3 days of work (16-20 hours) for the entirety of the next month (which he has not requested), Claimant voluntarily terminated his employment.

Claimant applied for unemployment benefits but was denied. He subsequently appealed this decision and the Board of Review upheld the denial of benefits due to the fact that (1) Claimant could not show proof that he was guaranteed a certain number of hours per week and (2) Claimant failed to show that a reasonable person would have quit instead of filing a grievance under the collective bargaining agreement that governed Claimant’s employment. Claimant then submitted a request a rehearing which was denied.

DECISION: The Board of Review decision is reversed and Claimant is entitled to unemployment benefits.

RATIONALE: As a matter of public policy, a non-voluntary, significant reduction in wages constitutes good cause attributable to the employer. If the court did not allow this to constitute good cause, this could allow employers to reduce wages near benefit level instead of releasing an employee. This would compel the employee’s resignation while simultaneously making them ineligible for benefits. Robertson v. Brown, 139 So. 2d 226, 229, 100 ALR 2d 1052 (La. Ct. App. 1962). This could make reducing hours a weapon of control for employers to make employees comply with their demands. Bunny’s Waffle Shop, Inc. v. Cal. Emp’t Comm’n, 151 P.2d 224, 227-28, 24 Cal. 2d 735, 741-43 (1944).

Digest Author: Cydney Warburton, Michigan Law, Class of 2017
Digest Updated: 1/6/2016

Laque v. Tru Tech Systems, Inc., UIA – 12.144

Laque v. Tru Tech Systems, Inc., UIA
Digest No. 12.144

Section 421.29(1)(a)

Cite as: Laque v Tru Tech Systems, Inc., Macomb Circuit Court, No. 2005-4944-AE

Appeal pending: No
Claimant: Michael J. Laque
Employer: Tru Tech Systems, Inc.
Docket no.: 2005-4944-AE
Date of decision: May 25, 2006

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HOLDING: When a claimant voluntarily terminates his or her employment, a withholding of wages by the employer pursuant to an IRS order constitutes good cause attributable to the employer when the employer continues such withholding long after the IRS order is resolved.

FACTS: Claimant held a traveling service job for Tru Tech, beginning January 2003 and ending in December 2004 when he quit due to withheld paychecks. In November 2004, Employer began to withhold wages earned by Claimant pursuant to a levy issued by the IRS. Claimant explained that the IRS had issued the levy by mistake and produced a release of the levy eight days after the IRS’s request for withholding. Employer continued to withhold paychecks due on December 2, 9, and 16, and on December 20, 2004, Claimant called Employer to end his employment due to the unnecessarily withheld pay. On December 18 (or earlier, based on the testimony of Employer), Claimant met with Employer to discuss changing his status to independent contractor. Employer failed to produce written record of any such discussion and claimant “vehemently disputed the employer’s testimony” that he had ever considered himself an independent contractor. When Claimant filed for unemployment benefits, his claim was denied by the Unemployment Insurance Agency. On appeal to an Administrative Law Judge, this decision was reversed and his claim was granted. On Employer’s appeal to the Michigan Employment Security Board of Review, the ALJ’s decision was at first reversed, then affirmed on reconsideration. Employer then appealed further to the District Court.

DECISION: The Board of Review decision is affirmed and Claimant is entitled to unemployment insurance benefits.

RATIONALE: When a justification for withholding pay, such as an IRS order, becomes ineffective (e.g., by an official rescission of the IRS order), employers immediately regain their duty to pay their employees in a timely fashion. For the relevant legal question of whether a “reasonable, average, and otherwise qualified worker” would give up her or his employment, such circumstances are essentially the same, from the worker’s perspective, as an employer withholding pay for no reason.

Digest Author: James Fahringer, Michigan Law, Class of 2017
Digest Updated: 1/6/2016

Hilton (Meijer Stores Limited) – 10.93

Hilton (Meijer Stores Limited)
Digest no. 10.93

Section 29(1)(a)

Cite as: Hilton (Meijer Stores Limited), 2004 BR 170939 (B2003-09139).

Appeal pending: No
Claimant: Akira Hilton
Employer: Meijer Stores Limited
Docket no.: B2003-09139-170939
Date of decision: August 31, 2004

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BOARD HOLDING: A claimant who has simultaneous employment with a part-time employer and a full-time employer, who leaves her part-time job because it conflicts with the full-time job, is disqualified under Section 29(1)(a) because her leaving was not attributable to the part-time employer.

FACTS: Claimant worked for Meijer on a part-time basis, and simultaneously worked full-time for Wallside Windows. Claimant voluntarily left her employment with Meijer because it conflicted with her full-time employment. Ten days later, Wallside Windows discharged the claimant for non-disqualifying reasons.

DECISION: The claimant is disqualified from receiving benefits under Section 29(1)(a).

RATIONALE: In Dickerson v Norrell Health Care, Inc., Kent Circuit Court No. 95-1806-AE September 21, 1995, (Digest 10.81), the circuit court addressed what presents itself as a gross inequity: that although claimant had been laid off from a full-time job for non-disqualifying circumstances, the claimant was nevertheless ineligible for benefits solely because the claimant had just voluntarily left an unrelated part-time job. The court’s conclusion that a claimant could not be found to have “left employment” unless her leaving resulted in total unemployment is at odds with the plain and unambiguous language of the statute. The court also ignores that the employer the claimant quit faces charges to its account and tax rate increases even though it in no way contributed to the job separation. Additionally, if such a claimant quit only one of her jobs, she could receive unemployment benefits provided she still worked at least part-time and thus was not totally unemployed. Then the former full-time employer’s account would be charged for the benefits paid, and the current part-time employer would also be charged for a portion of the benefits, even though neither employer in any way contributed to the claimant’s job separation. The Board notes that circuit court decisions are not binding precedent. Due to the potential unintended consequences of Dickerson, if a change in the statutory language is necessary, it should come from the legislature.

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

Lakeshore Public Academy v Scribner – 10.91

Lakeshore Public Academy v Scribner
Digest no. 10.91

Section 29(1) (a)

Cite as: Lakeshore Pub Academy v Scribner, Oceana Circuit Court, Docket No. 03-004110-AE (May 10, 2004).

Appeal pending: No
Claimant: Patricia A. Scribner
Employer: Lakeshore Public Academy
Docket no.: B2003-06865-RO1-170206
Date of decision: May 10, 2004

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CIRCUIT COURT HOLDING: Claimant established good cause for leaving. Employer did not complete the process of handling the claimant’s complaint by communicating to her that it was investigated and what action would or would not be taken in response. The claimant reasonably concluded the employer was unable or unwilling to discipline a co-worker who violated employer’s rule against threatening behavior.

FACTS: Claimant worked as a teacher. Another teacher and his wife, confronted claimant in her classroom regarding her discipline of their child on the previous day. Claimant testified the other teacher put his finger in her face, glared at her, and made intimidating comments. This happened as students were entering the classroom. Claimant reported this incident to the employer, and indicated she could not work under those conditions. Employer had a policy prohibiting threatening behavior toward staff which provided that if a threat occurred, the perpetrator would be disciplined. Employer’s witness investigated the incident, but could not reconcile differing statements from claimant and the other teacher, so the teacher was not disciplined. After not hearing anything more from the administration, claimant resigned a couple weeks later.

DECISION: Claimant is not disqualified for voluntary leaving.

RATIONALE: “The ALJ’s decision turned on the failure of the Academy to complete the normal and expected handling of an employee’s grievance by communicating to the employee the results of the investigation and what, if any, action would be taken in response to the complaint.” It is the manner in which employer handled the complaint, not the failure to impose discipline, that leads to a finding of non-disqualification.

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

Human Capability Corp v Carson – 10.96

Human Capability Corp v Carson
Digest no. 10.96

Section 29(1)(a)

Cite as: Human Capability Corp v Carson, Wayne Circuit Court, Docket No. 03-331656-AE (April 6, 2004).

Appeal pending: No
Claimant: Barbara D. Carson
Employer: Human Capability Corporation
Docket no.: B2003-02940-169363
Date of decision: April 6, 2004

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CIRCUIT COURT HOLDING: Where the employer unilaterally changed the terms and conditions of employment by altering the employee handbook to include non-competition and prohibition of outside employment provisions, the claimant had good cause for voluntary leaving.

FACTS: In January 2002, employer updated the policies contained in its 1998 employee handbook. The 2002 employee handbook contained a non-competition provision and prohibited outside employment. The claimant refused to sign and was separated from employment. The 1998 employee handbook prohibited outside work on employer’s time, and lacked an express provision barring work with a competitor after separating from employer’s employ.

DECISION: Claimant is not disqualified for voluntary leaving.

RATIONALE: The employer did not dispute that claimant left work voluntarily. The employer asserted claimant lacked good cause for leaving because claimant was an at-will employee, who lacked an employment contract or a legitimate expectation that employer would not alter the terms and conditions or employment. The court held that employer’s argument was misplaced – that claimant’s employment status and employer’s right to alter the terms and conditions of work would be pertinent if the enforceability of a common-law employment contract were at issue. Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich 579 (1980). The court found that Toussaint and its progeny do not govern administrative proceedings when the issue is whether the claimant left with good cause attributable to employer under Section 29(1)(a) of the Act.

The addition of the moonlighting prohibition and anti-compete clause were a substantial and material change in the terms of employment.

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