Opinion
DOCKET NO. A-3816-12T3 DOCKET NO. A-3817-12T3
06-26-2015
BOGDAN CIELUCH, Appellant, v. BOARD OF REVIEW, DEPARTMENT OF LABOR, Respondent.
Law Offices of Gregory S. Schaer, L.L.C., attorneys for appellant (Mr. Schaer, on the brief). John J. Hoffman, Acting Attorney General, attorney for respondent (Melissa H. Raksa, Assistant Attorney General, of counsel; Anthony DiLello, Deputy Attorney General, on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Ashrafi and O'Connor. On appeal from the Board of Review, Department of Labor and Workforce Development, Docket Nos. 357,630 and 362,181. Law Offices of Gregory S. Schaer, L.L.C., attorneys for appellant (Mr. Schaer, on the brief). John J. Hoffman, Acting Attorney General, attorney for respondent (Melissa H. Raksa, Assistant Attorney General, of counsel; Anthony DiLello, Deputy Attorney General, on the brief). PER CURIAM
In these consolidated appeals, claimant Bogdan Cieluch appeals from the decisions of the Board of Review, Department of Labor and Workforce Development, (the Board) requiring that he refund almost $12,000 in unemployment compensation benefits paid to him in 2011. We reverse in part and remand in part for a further determination, in accordance with the conclusions of law stated in this opinion, of benefits that may have been improperly paid.
Cieluch's brief describes the facts and the law in this dispute as "extraordinarily complicated and confusing." Part of the complexity arose because the Division of Unemployment Insurance (the Division) admittedly made mistakes in administering the claims. A second complication, now resolved, is that the Board and its Appeal Tribunal ruled inconsistently at different times as to whether Cieluch's administrative appeals were timely filed. However, the essential facts of Cieluch's work and unemployment history are not overly complicated or in dispute.
Cieluch is a Polish immigrant who speaks limited English. He works as a mason and is only employed when there is work available for him. He has applied frequently for unemployment benefits when he is without work.
At the time of Cieluch's 2009 to 2011 unemployment claims that resulted in these appeals, he had worked for about ten years with a New Jersey company named CMU Construction Company, Inc. (CMU). He also did some work for other construction companies. Most of his work was in New Jersey, but he worked on a CMU project in New York for five to six weeks in September and October 2010, earning $6,679.40 from that job as shown on a separate W-2 form issued by CMU.
Cieluch filed a claim for unemployment benefits on September 6, 2009, and another claim on September 5, 2010. He received benefits on each claim. He applied again for benefits on July 31, 2011. Instead, of reopening the 2010 claim as it should have done because only one claim per year may be filed, the Division opened a new claim for Cieluch. It paid $4,186 in benefits on the new claim for the weeks ending August 6 to September 17, 2011. By notice dated September 29, 2011, the Division canceled the July 2011 claim and demanded that Cieluch repay the $4,186 on the ground that it was a second claim within one year and his 2010 claim benefits had been exhausted.
The Board alleges in its brief that Cieluch received unemployment benefits in New Jersey at the same time that he was working and receiving income in New York in the fall of 2010, but that allegation was not a basis for the Board's decisions, and the Board does not rely on it for purposes of this appeal. We make no determination as to Cieluch's eligibility for benefits based on alleged simultaneous employment on the New York project.
On October 4, 2011, the Division issued two more notices to Cieluch demanding that he refund an additional $7,608 on the ground that "a monetary redetermination reduced your entitlement" to benefits that had been paid. According to one of these notices, $600 had been improperly paid on his September 2010 claim for the week ending May 7, 2011. The second notice alleged that $7,008 had been improperly paid on Cieluch's September 2009 claim for the weeks from May 14 through June 25, 2011, and from August 6 through September 3, 2011.
The payments made in 2011 on the 2009 claim were extended benefits under federal law, as we will further explain. We note that the weeks August 6 through September 3, 2011, are also weeks in which Cieluch was allegedly paid benefits in a different amount under the incorrectly opened July 31, 2011 claim.
Cieluch filed administrative appeals. A telephonic hearing was conducted by the Appeal Tribunal on February 13, 2012. The hearing examiner described the issues to be resolved as "timelineness of [the] appeal and non-fraud refund." The Appeal Tribunal initially concluded by two written decisions dated March 5, 2012, that Cieluch's appeals should be considered as if timely filed but that he was not entitled to the benefits he received. It concluded that Cieluch was liable for a refund of $4,186 because the July 31, 2011 claim was the second claim in one year and of $7,608 because Cieluch should have filed a claim in New York for the benefits paid under his 2009 and 2010 claims.
On Cieluch's further appeal, the Board remanded to the Appeal Tribunal to take more testimony on both the timeliness and refund issues. A new telephonic hearing was held on September 12, 2012. This time, the Appeal Tribunal ruled that Cieluch had not filed timely appeals and dismissed his administrative appeals entirely. The Board affirmed that decision on February 27, 2013.
Cieluch appealed to this court. On February 12, 2014, we denied a motion filed on behalf of the Board for a remand to decide the merits of the case. At the same time, we suggested that the Board might voluntarily concede error on the issue of timeliness of Cieluch's administrative appeals and agree to decide the merits of Cieluch's entitlement to benefits. The Board filed another motion for a remand, agreeing with our suggestion. On April 4, 2014, we remanded to the Board to issue final decisions within sixty days on the merits of the refund demands. Instead of complying with our order, the Board remanded the cases to the Appeal Tribunal. On July 21, 2014, we issued another order compelling the Board to issue final decisions within thirty days.
By two written decisions dated August 19, 2014, the Board ruled that the administrative appeals had been timely filed but that Cieluch was liable for a refund of $4,186 on the July 31, 2011 claim because "the benefit year on the claim dated September 5, 2010, had not elapsed prior to the filing of the claim dated July 31, 2011." Determining, however, that the Division had already recouped a portion of that amount through an offset of benefits for some of the same weeks, the Board reduced the refund demand to $1,266 on that claim. The Board's second decision of August 19, 2014, upheld the Division's refund demand of $7,608 on the September 2009 and September 2010 claims because Cieluch should have filed for benefits in New York rather than in New Jersey.
Thus, after almost two-and-a-half years of litigation, the Board adopted essentially the same reasoning and decisions as the original Appeal Tribunal decisions of March 2012, adjusted only by an offset that is not explained in our record.
It appears that the offset refers to $584 per week for the five weeks from August 6 to September 3, 2011, that Cieluch was slated to receive as federal extended benefits under his September 2009 claim. The effect of the overlapping weeks on Cieluch's entitlement to benefits and how the offset was accomplished is not revealed in our record.
Cieluch now argues that the Board erred in that he had no basis to apply for unemployment compensation benefits in New York and that he was not responsible for any administrative error in opening the July 31, 2011 claim separately from the September 2010 claim. The Board argues that a refund is mandated by N.J.S.A. 43:21-16(d) and by the federal law applicable to some of the funds paid to Cieluch under the Emergency Unemployment Compensation Act of 2008 (EUC), Pub. L. No. 110-252 § 4001, Title VI, 122 Stat. 2323, 2353-57 (2008).
The EUC appears as a note to 26 U.S.C.A. § 3304, which the EUC amended. It provides that a state may choose to offer to its claimants extended unemployment benefits that will be reimbursed by federal funds, but the state must comply with eligibility requirements of the federal law. One of the requirements is that an eligible individual has exhausted and has no further rights to any unemployment compensation benefits under state law. --------
Our review of an agency's final decision is limited. In re Taylor, 158 N.J. 644, 656 (1999); Brady v. Bd. of Review, 152 N.J. 197, 210 (1997). "An administrative agency's final quasi-judicial decision will be sustained unless there is a clear showing that it is arbitrary, capricious, or unreasonable, or that it lacks fair support in the record." In re Herrmann, 192 N.J. 19, 27-28 (2007); see also Mullarney v. Bd. of Review, 343 N.J. Super. 401, 406 (App. Div. 2001) (scope of appellate review in appeal from denial of unemployment benefits).
The factual findings of the agency must stand unless they are not supported by sufficient credible evidence. Self v. Bd. of Review, 91 N.J. 453, 459 (1982). The interpretation of a statute, however, is a judicial function; the court is not bound by the agency's interpretation. Mayflower Sec. Co. v. Bureau of Sec., 64 N.J. 85, 93 (1973).
N.J.S.A. 43:21-16(d) provides that any person who receives benefits to which he is not entitled must repay the benefits. Repayment is required even when the claimant acted in good faith. Bannan v. Bd. of Review, 299 N.J. Super. 671, 674 (App. Div. 1997).
The Board contends that Cieluch was not entitled to benefits beginning in May 2011 because he "exhausted his benefits in New Jersey for claim year September 5, 2010 through September 3, 2011" and "had a valid claim in New York for which he could have received benefits." While our record neither establishes nor refutes the correctness of the first reason, we reject the second one as a basis to deny Cieluch's claim.
In Vale v. Gaylords Nat'l Corp., 127 N.J. Super. 45, 47-48 (App. Div. 1974), we explained that "uniform definitions [of employment] are used throughout the nation on the theory that only one state shall become liable for unemployment compensation benefits, and to insure such liability in an appropriate jurisdiction to one entitled to benefits."
The pertinent New Jersey statue provides:
The term "employment" shall include an individual's entire service performed within or both within and without this State if:
A) The service is localized in this State; or
B) The service is not localized in any state but some of the service is performed in this State, and (i) the base of operations, or, if there is no base of operations, then the place from which such service is directed or controlled, is in this State; or (ii) the base of operations or place from which such service is directed or controlled is not in any state in which some part of the service is performed, but the individual's residence is in this State.
[N.J.S.A. 43:21-19(i)(2).]
The statute adds that service "shall be deemed localized within a state" if it is performed "both within and without such state, but the service performed without such state is incidental to the individual's service within the state; for example, is temporary or transitory in nature or consists of isolated transactions." N.J.S.A. 43:21-19(i)(5)(B). "[T]hese tests are to be applied successively to the end that eligibility can be denied only if the claimant satisfies none of them." Vale, supra, 127 N.J. Super. at 48 (citing Claim of Mallia, 86 N.E.2d 577, 580 (N.Y. 1949)). New York State's unemployment statutes contain comparable language. See N.Y. Lab. Law § 511.
An example of how the statutes are applied is provided in Vale, supra, 127 N.J. Super. at 47. In that case, the claimant worked for a company with its main office in New Jersey and with forty-three retail stores in other states, but not in New Jersey. Ibid. The claimant resided in Ohio, and worked only three to five percent of his time in New Jersey. Ibid. He spent ten to fifteen percent of his working time in Ohio, and the rest of his time traveling to various stores in other states. Ibid. He was paid from New Jersey, and any orders he received came from New Jersey. Ibid. When his employment ended, the claimant applied for unemployment benefits in New Jersey and was denied. Ibid. On his appeal, we remanded the case for a hearing to determine whether he had a "base of operations" in Ohio. Id. at 50.
In this case, Cieluch lived in New Jersey. Most of his jobs were performed in New Jersey. He only worked in New York for six weeks in 2010. The W-2 forms issued by his employer, CNU, support Cieluch's contention that the New York job was incidental to his employment in New Jersey. The company's Somerset, New Jersey, address was also listed on Cieluch's New York W-2 form. These facts show that Cieluch's "service" was "localized" in New Jersey. N.J.S.A. 43:21-19(i)(2)(A). Accordingly, for the purposes of the New Jersey unemployment compensation law, N.J.S.A. 43:21-1 to -24.30, Cieluch was employed in New Jersey, not in New York.
The record does not support the Board's conclusion that Cieluch had a valid claim for unemployment compensation in New York because of the one project he completed there. Cieluch was eligible in 2011 to renew his New Jersey claim or to receive EUC benefits in New Jersey. Therefore, we reverse the Board's decision requiring Cieluch to refund $7,608.
With respect to the other refund — the $4,186 paid on the July 2011 claim for August 6 through September 17, 2011 — we agree with Cieluch that he is not at fault for the Division's opening a new claim when he applied for benefits on July 31, 2011. But we cannot determine on this record whether he was entitled to any benefits on his September 2010 claim or for extended benefits under federal law. We do not know whether the benefits payable to Cieluch for the weeks from August 6 to September 3, 2011, were duplicative of payments made on his 2009 or 2010 claims, and whether his 2010 benefits were in fact exhausted.
We remand to the Board to determine whether Cieluch was entitled to receive benefits based on his July 31, 2011 application without regard to the improper opening of a new claim and without regard to his purported eligibility for benefits in New York. If Cieluch was not entitled to any of the benefits he received on the July 31, 2011 claim because he was already receiving extended federal benefits for the same time period, then he will have to refund any portion of the $4,186 that has not been offset or he has not already refunded.
We reverse the Board's final decision of August 19, 2014 in A-3817-12 (Board docket number 362,181), thus relieving Cieluch of the requirement that he refund $7,608. We remand with respect to its final decision of the same date in A-3816-12 (Board docket number 357,630) for further proceedings in conformity with this decision in requiring the refund of $4,186. We do not retain jurisdiction. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION