Beres: Agency discretion to undo a statutory scheme

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In Beres, the case turns on a dispute between the Department and the Commission over whose interpretation of the absenteeism disqualification is most reasonable. In its quest to get its interpretation adopted, the Department is willing to subject all agency decision-making to heightened scrutiny.

Taking effect in January 2014, Wis. Stat. § 108.04(5)(e) provides that a claimant will be disqualified for misconduct when an employee is absent “on more than 2 occasions within the 120 day period before the date of the employee’s termination, unless otherwise specified by his or her employer.”

The employer nursing home in Beres apparently took advantage of the “unless otherwise specified by his or her employer” provision and had an attendance policy which indicated that employees would be terminated for a single absence during their 90-day probationary period if they were a no call, no show. The claimant in this case, Ms. Beres, was extremely ill and did not report to work or call in her absence. The employer called her home, and her spouse indicated that she was too sick to work. The employer then terminated her employment, and the Department denied her claim for unemployment benefits as misconduct because of absenteeism.

So, unlike the long-standing statute being applied in a new situation at issue in TetraTech, the statute in question in Beres is brand new, poorly drafted, and in conflict with what was originally proposed. See Beres, part 1. The language in question literally makes no sense for purposes of unemployment law. Cf. Wis. Stat. § 108.01.

Confronted with this nonsensical provision, the Commission reasonably concluded that the “unless otherwise” provision for an employer absenteeism policy cannot set a threshold lower than the statutory “more than two absences in 120 days.” Because the claimant in Beres was not responsible for her illness and a single illness did not meet the threshold disqualification of more than two absences within 120 days, the Commission explained, she was NOT disqualified. See Absenteeism decision excludes zero-tolerance policy as misconduct (8 Match 2017) for discussion of the court of appeals decision.

The Wisconsin Supreme Court is now considering this case alongside the question of what level of deference is constitutionally and statutorily due. At the court of appeals (which sided with the Commission 2-1), due weight deference was given the Commission’s position. Under this standard, the court would only affirm the Commission if there was NO other reasonable interpretation proffered.

So, there is no reason per se in this case to create a new deference standard. The justices will find either the Commission or the Department interpretation of the absenteeism to be the reasonable one.

But, there is a long-game for what the Department is doing in this case. If there is no more “great weight” deference given to long-standing Commission interpretations, then the Department (along with all employers and employees) can challenge any and all of the Commission’s prior precedents. The Commission will need to defend its prior decisions as the most reasonable interpretation available rather than relying on their previously established reasonableness to stop the challenge in its tracks.

And, the first target of this attack will certainly be on the Commission’s unemployment concealment decisions that mandate the alleged unemployment fraud in question be intentional rather than accidental. As noted numerous times here, the Department and the Commission have been at odds on this issue since 2014, and the dispute led in 2017 to the Department pushing for the elimination of the Commission in the state budget.

Finally, if the court should agree with the Department and find that an employer gets to set an absenteeism disqualification based on a single absence regardless of reason, then the court will essentially be creating a disqualification that swallows all of unemployment law. Under the Department’s interpretation, any employer can replicate this “single absence provides the basis for a discharge” provision and then apply this disqualification whenever an employee is absent in order to keep an employee from receiving any unemployment benefits connected to that employer. The limited misconduct disqualification that should never apply when employees lose work through no fault of their own essentially becomes a no-fault disqualification for absenteeism.

And, an employer has much to gain from this broard disqualification. Whenever there is a finding of misconduct in Wisconsin unemployment law, the employee guilty of that misconduct loses all of his or her income from the employer for determining both current and future benefit year eligibility for unemployment benefits. Hence, this broad reading of the absenteeism provision enables an employer to discharge employees for misconduct purposes for any of their absences and thereby insulate itself from ever having its experience rating increased.

All the posts in this series

UPDATE (12 Dec. 2017): Added links for all the posts in this series.