Opinion
No. 1784 C.D. 2012
06-24-2013
Frederick A. Carlson III, Petitioner v. Unemployment Compensation Board of Review, Respondent
BEFORE: HONORABLE BONNIE BRIGANCE LEADBETTER, Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE JAMES GARDNER COLINS, Senior Judge OPINION NOT REPORTED MEMORANDUM OPINION BY JUDGE LEADBETTER
Claimant Frederick A. Carlson III petitions for review of an order of the Unemployment Compensation Board of Review (Board) that affirmed the decision of a referee to deny his request to have his weekly unemployment benefit rate increased from $251 to $478, concluding that his base-year wages were insufficient to support being paid at 50% of his full-time weekly wage under Section 404 of the Unemployment Compensation Law (Law). Specifically at issue is the regulatory phrase "generally paid" in 34 Pa. Code § 61.3(a), which provided:
Act of December 5, 1936, Second Ex. Sess., P.L. (1937) 2897, as amended, 43 P.S. § 804.
(a) Date of payment. Wages shall be considered to be paid on the day on which amounts definitely assignable to a payroll period are generally paid by the employer, even though the wages have not actually been reduced to the possession of the employees. [Emphasis added.]Having determined that the Board properly refused to include a check for $896.63 in Claimant's base-year computation, we affirm.
This regulation was subsequently amended to provide as follows:
(a) Date of payment.34 Pa. Code § 61.3(a)(1) and (2). The amended regulation is not at issue here.
(1) General rule - Wages are considered paid on the date when the employer actually pays them.
(2) Delayed payment of wages - For purposes of benefits, if payment of wages is delayed, the wages are considered paid on the date when the employer generally pays amounts definitely assignable to a payroll period.
Employed as a union construction worker, Claimant was generally paid $23.91 per hour and his full-time weekly wage was $956.40. Claimant filed an application for unemployment compensation benefits in December 2011. The Department of Labor and Industry, Bureau of UC Benefits and Allowances (Department) found him to be financially eligible for weekly benefits in the amount of $251, based on base-year wages of $18,604. Claimant appealed, requesting that his weekly benefit rate be 50% of his full-time weekly wage, which would be $478. There is no dispute that in order to qualify for the higher amount, Claimant's base-year wages would have to be $19,040. After a hearing at which Claimant appeared and testified, the referee concluded that Claimant did not have sufficient base-year wages to warrant the increase. On appeal, the Board remanded the matter to a referee to act as a hearing officer and directed as follows:
The purpose of this hearing is to fully develop the record with regard to the merits of the case. Please have the claimant submit into evidence the paystubs that show that he earned additional wages in his base years. Please have a Department representative testify as to whether the claimant would now be eligible for his weekly benefit rate being established at 50% of his full time weekly wage.Certified Record (C.R.), Item No. 11.
Notwithstanding the Board's directive that a Department representative appear and testify at the remand hearing and the referee's notation that a notice of hearing was mailed to the UC Service Center, no Department representative took part in the hearing. As the only party to present evidence, Claimant submitted the two pay stubs from Mark Schaffer Excavating & Trucking, Inc., (Schaffer) that he had attached to his April 2012 appeal to the Board. C.R., Item No. 10. The pay stub for Check No. 11519, in the amount of $896.63 and dated Friday, July 1, 2011, indicated that it was for the week ending Saturday, June 25, 2011. The pay stub for the second check, Check No. 11545, in the amount of $1315.05 and dated Friday, July 8, 2011, indicated that it was for the week ending Saturday, July 2, 2011. Claimant, however, testified that he actually got the checks before their printed check dates.
The relevant testimony is as follows:
Referee: Now the first check was for week ending June 25, 2011, correct?C.R., Item No. 13, June 22, 2012 Remand Hearing, Notes of Testimony (N.T.) at 3.
Claimant: Yes.
Referee: And that check was paid to you, if I'm looking at this right you actually were paid on July 1st of 2011, correct? That's the check date?
Claimant: Well actually we got it before that but that's the date they put on it.
Referee: Okay. And then the next one was for the following week, and it says the check date was July 8th. And you're saying you probably still would've gotten that a few days earlier if I understand ... [you?]
Claimant: Right.
On remand, the Board affirmed but did not make any independent fact-findings. Instead, it adopted and incorporated the referee's findings and conclusions in their entirety, which did not cover the evidence on remand. The Board further stated, however, that it had given consideration to the entire record, including the testimony submitted at the remand hearing. Unfortunately, other than stating that the referee's determination was "proper under the [Law] as interpreted by the appellate courts," the Board did not elaborate. In any event, it is clear that the Board did not include Check No. 11519 in calculating Claimant's base-year wages. Had it done so, his base-year wages would have been in excess of the qualifying wages of $19,040. Claimant's timely petition for review to this Court followed.
Board's Decision at 1.
Claimant had the burden to establish that he was financially eligible for benefits. Pagliei v. Unemployment Comp. Bd. of Review, 37 A.3d 24, 26 (Pa. Cmwlth. 2012). In order to compute an unemployed claimant's financial eligibility for benefits during his "benefit year," the fifty-two weeks following a valid application for benefits, a claimant must have sufficient wages in covered employment during his "base year." A "base year" is "the first four of the last five completed calendar quarters immediately preceding the first day of an individual's benefit year." In the present case, Claimant filed his application for benefits on December 18, 2011, thereby establishing a base year of July 1, 2010 to June 30, 2011. The Department did a breakdown of Claimant's base-year wages by quarter:
Section 4(b) of the Law, 43 P.S. § 753(b).
Section 4(a) of the Law, 43 P.S. § 753(a).
Third Quarter of 2010: $6214C.R., Item No. 2. Accordingly, the Department concluded that Claimant's total base-year wages were $18,604.
Fourth Quarter of 2010: $3494
First Quarter of 2011: $5660
Second Quarter of 2011: $3234
On appeal, Claimant contends that the Board should have included Check No. 11519 in the computation. He emphasizes his uncontroverted testimony that he got Check No. 11519 a few days before the July 1, 2011 check date, thus warranting its inclusion in the second quarter of 2011, which ended on June 30th, and resulting in sufficient base-year wages to support being paid at 50% of his full-time weekly wage. In addition, he indicates that he testified that Schaffer did not have regular Friday paydays. Accordingly, contending that the Board capriciously disregarded critical evidence without explanation, he maintains that the check should have been deemed "generally paid" during the second quarter of 2011 consistent with this Court's holding in Gibson v. Unemployment Compensation Board of Review, 682 A.2d 422 (Pa. Cmwlth. 1996) and 34 Pa. Code § 61.3.
As an initial matter, we cannot determine from the Board's decision whether it discredited Claimant's uncontroverted testimony that he received his checks from Schaffer prior to the printed check dates or concluded that his testimony was insufficient as a matter of law. The Board's silence in that regard, however, is irrelevant in light of the law governing when checks are payable and that law's interaction with the regulation at issue. We turn, therefore, to construing 34 Pa. Code § 61.3(a) and determining when the Schaffer wages were "generally paid."
Where Claimant as the burdened party was the only party to present evidence at the remand hearing and did not prevail, we consider whether the Board capriciously disregarded competent evidence. Blackwell v. Unemployment Comp. Bd. of Review, 555 A.2d 279, 280-81 (Pa. Cmwlth. 1989).
In Gibson, the employer routinely paid group III employees alternate Fridays, but for three dates. On one of those dates, the employer made the payment on the Thursday before Good Friday, which the Department attributed to the last day of the first quarter instead of the first day of the second quarter, rendering the claimant financially ineligible for benefits. We reversed, concluding that because the employer routinely and "generally paid" the claimant on alternate Fridays, a payment arbitrarily made on the Thursday before Good Friday should have been attributed to Good Friday. In so determining, we interpreted the terms "generally" and "paid" in 34 Pa. Code § 61.3 as follows:
The ordinary meaning of "generally," ... is "in disregard of specific instances and with regard to an overall picture," "on the whole," or "as a rule." And, this Court has construed the term, "paid," as utilized in the provisions of the Law, to mean "received." See, e.g., Wooley v. Unemployment Compensation Board of Review, 71 Pa. Cmwlth. 162, 454 A.2d 224 (1983) (holding the term "paid," as set forth in Section 4(x) of the Law, 43 P.S. § 753(x), means wages which have been received by employees and does not encompass wages which have been merely earned).Gibson, 682 A.2d at 424 (emphasis in original). We first address the term "generally."
Although the focus in Gibson was on "generally" and not "paid," we find the court's construction of those terms to be instructive.
Claimant maintains in his brief that he testified that Schaffer did not have regular Friday paydays. Having carefully reviewed both the transcript from the original proceedings and the one on remand, we found no such testimony. In any event, the evidence of record belies Claimant's contention. The record contains three checks from Schaffer, all of which are dated Friday for the week ending the prior Saturday. The three checks, two of which we already noted, are as follows:
1. Check No. 11519, dated Friday, July 1, 2011, work week ending Saturday, June 25, 2011;C.R., Item Nos. 3 and 10. Contrary to Claimant's representation, therefore, the evidence supports the conclusion that Schaffer routinely and generally issued checks on Friday for the work week ending the prior Saturday. We turn next to the term "paid."
2. Check No. 11545, dated Friday, July 8, 2011, work week ending Saturday, July 2, 2011;
3. Check No. 11576, dated Friday, July 15, 2011, work week ending Saturday, July 9, 2011
In Gibson, we equated "paid" with "received" and noted that "paid" "means wages which have been received by employees and does not encompass wages which have been merely earned." Id. at 424 (emphasis in original). There is no dispute that Claimant earned the wages reflected in Check 11519 during the second quarter of 2011; the issue is when he received them. In that regard, Claimant makes much of his undisputed testimony that he received the Schaffer checks before their printed check dates. Even if his testimony in that regard was deemed credible, Claimant's representation of receipt prior to the printed check dates is of no moment. The law is clear that a negotiable instrument such as a dated check "is not payable before the date of the instrument." Section 3113(a) of the Uniform Commercial Code, 13 Pa. C.S. § 3113(a). See also Urick Foundry Co. v. Workmen's Comp. Appeal Bd. (Aarnio), 496 A.2d 883, 885 n.2 (Pa. Cmwlth. 1985) [noting that "[a] check is a negotiable instrument which is payable on demand on or after the date specified on its face."]
Cases interpreting 34 Pa. Code § 61.3 and where courts did not equate "paid" with "received," include those where employers failed to make payments when the wages should have been "generally paid." In Cugini v. Unemployment Compensation Board of Review, 511 Pa. 264, 512 A.2d 1169 (1986) (plurality opinion), payment of claimant's severance pay was delayed because the employer filed for bankruptcy. The Cugini Court held that the Board must treat wages as paid on the date the employer was supposed to make the payments in accordance with customary practice. Id. at 272, 512 A.2d at 1173. The Court, therefore, interpreted the regulation to mean that the wages should have been deemed paid when claimant actually earned them and employer generally paid them, rather than when claimant actually received them. Id. at 269, 512 A.2d at 1171. See also Fisher v. Unemployment Comp. Bd. of Review, 696 A.2d 895, 899 (Pa. Cmwlth. 1997) (court remanded for a determination as to when vacation monies were earned and should have been paid); Coates v. Unemployment Comp. Bd. of Review, 676 A.2d 742, 747 (Pa. Cmwlth. 1996) (where employer paid leave wages in lump sum in order to settle dispute, court held that Board should have treated them as though employer paid them bi-weekly). There is no indication in the present case that Schaffer did not pay Claimant's wages when it was supposed to do so and when they were due. Accordingly, "paid" should be equated with "receipt" in the present case in accordance with Gibson. --------
Moreover, the evidence of record indicates that Schaffer followed a structured pay schedule and that it made payments in accordance with the printed check dates. The pertinent regulatory language provides that "[w]ages shall be considered to be paid on the day on which amounts definitely assignable to a payroll period are generally paid by the employer ...." 34 Pa. Code § 61.3(a) (emphasis added). The paystub for Check 11519 indicates that Claimant worked 37.50 hours and that the check, dated July 1, 2011, was for the week ending June 25, 2011. In light of the fact that the timetables on the other Schaffer checks are consistent with the check at issue, July 1st was the day on which the amount earned for that pay period was definitely assignable to the payroll period for the week ending June 25th, and, therefore, the date on which the wages were "paid." This interpretation is consistent with the law governing checks.
In conclusion, even though Claimant earned the wages at issue during the second quarter of 2011, Schaffer paid them on July 1st, thereby rendering them properly allocable to the quarter immediately following his base year. Accordingly, we affirm.
/s/_________
BONNIE BRIGANCE LEADBETTER,
Judge ORDER
AND NOW, this 24th day of June, 2013, the order of the Unemployment Compensation Board of Review is hereby AFFIRMED.
/s/_________
BONNIE BRIGANCE LEADBETTER,
Judge