Opinion
No. 2 C.D. 2011 No. 102 C.D. 2011
02-23-2012
Kevin Nichols, Petitioner v. Unemployment Compensation Board of Review, Respondent
BEFORE: HONORABLE DAN PELLEGRINI, Judge HONORABLE P. KEVIN BROBSON, Judge HONORABLE PATRICIA A. McCULLOUGH, Judge OPINION NOT REPORTED MEMORANDUM OPINION BY JUDGE McCULLOUGH
This case was assigned to the opinion writer before January 7, 2012, when Judge Pellegrini became President Judge.
Kevin Nichols (Claimant) petitions for review of the December 3, 2010, orders of the Unemployment Compensation Board of Review (Board) affirming the decisions of a referee that Claimant was ineligible for unemployment compensation (UC) benefits under section 402(e) of the Unemployment Compensation Law (Law), Emergency Unemployment Compensation (EUC) benefits under section 4001(b) of Title IV of the Supplemental Appropriation Act of 2008 (EUC Act), and Federal Additional Compensation (FAC) benefits under section 2002(f) of Title II of the American Recovery and Reinvestment Act of 2009 (ARRA). The referee's decision also assessed a recoupable fault overpayment of UC benefits under section 804(a) of the Law and assessed a non-fraud recoupable overpayment of EUC and FAC benefits under section 4005(b) and (c) of the EUC Act. We affirm.
Act of December 5, 1936, Second Ex. Sess., P.L. (1937) 2897, as amended, 43 P.S. §802(e). Section 402(e) of the Law provides that an employee shall be ineligible for UC benefits for any week in which his unemployment is due to his discharge or temporary suspension from work for willful misconduct connected with his work.
Pub.L. 110-252, 122 Stat. 2323, §4001(b), 26 U.S.C. §3304 Note. Section 4001(b) of the EUC Act, provides that a "State agency ... will make payments of [EUC benefits] to individuals who—(1) have exhausted all rights to regular compensation under the State law or under Federal law with respect to a benefit year...."
Pub.L. No. 111-5, 123 Stat. 115, §2002(f), 26 U.S.C. §3304 Note. Section 2002(f) of the ARRA provides that "[t]he provisions of section 4005 of the [EUC Act] shall apply with respect to additional compensation (as described in subsection (b)(1)) to the same extent and in the same manner as in the case of emergency unemployment compensation."
43 P.S. §874(a). Section 804(a) of the Law provides, in pertinent part:
(a) Any person who by reason of his fault has received any sum as compensation under this act to which he was not entitled, shall be liable to repay to the Unemployment Compensation Fund to the credit of the Compensation Account a sum equal to the amount so received by him and interest at the rate determined by the Secretary of Revenue....
§4005(b), (c), 26 U.S.C. §3304 Note. Section 4005(b) and (c) of the EUC Act provides in pertinent part:
(b) Repayment.—In the case of individuals who have received amounts of [EUC benefits] under this title to which they were not entitled, the State shall require such individuals to repay the amounts of such [EUC benefits] to the State agency, except that the State agency may waive such repayment if it determines that—
(1) the payment of such [EUC benefits] was without fault on the part of any such individual; and
(2) such repayment would be contrary to equity and good conscience.
(c) Recovery by State Agency.—
(1) In General.—The State agency may recover the amount to be repaid, or any part thereof, by deductions from any [EUC benefits] payable to such individual under this title or from any unemployment compensation payable to such individual....
Claimant filed an application for UC benefits effective January 13, 2008, and an EUC claim was created for him on August 11, 2008. Claimant filed a new application for UC benefits effective October 18, 2009, following the termination of his employment as a shipping and receiving clerk with Medical Supply Inc. (Employer). A representative of a UC service center concluded that Claimant had been discharged for reasons that constitute willful misconduct under section 402(e) of the Law based on his failure to properly report off of work when he was aware of Employer's reporting procedures. As a result, benefits were denied. The representative also determined that Claimant had received a fault overpayment of $5,288.00 in UC benefits, $2,295.00 in EUC benefits, and $225.00 in FAC benefits.
Claimant appealed these determinations, and a hearing was conducted before a referee on September 24, 2010. Claimant testified in support of his appeals; Employer presented the testimony of its office manager and its warehouse manager in opposition.
Appeal Nos. 10-09-H-7234 (7234 Decision) and EUC 10-09-H-7233 (7233 Decision).
On September 27, 2010, the referee issued two decisions disposing of Claimant's appeals. The referee's findings may be summarized as follows. Claimant was employed by Employer from October 18, 2008, to November 18, 2009. Employer's policy provides that an employee's failure to report an absence or tardiness 30 minutes prior to your designated start time on two consecutive days is cause for discharge. Claimant was aware of Employer's policy. On November 1, 2009, Claimant was cleared to return to work following an injury to his back and leg. On November 19, 2009, Claimant was scheduled to work at 7:00 a.m. and did not appear for his shift. That same day, Claimant contacted Employer at 11:47 a.m. to report his absence. Claimant was scheduled to work at 7:00 a.m. on November 20, 2009, and did not appear for his shift or contact Employer 30 minutes prior to the start of his shift. On November 23, 2009, Claimant contacted Employer and was told that he needed to speak with Employer's CEO before coming to work. On November 26, 2009, Claimant was discharged for failing to report an absence in conformity with Employer's policy for two consecutive days. Claimant filed an initial application for UC benefits effective January 13, 2008, and a EUC claim was created for him on August 11, 2009. Claimant filed a new application for UC benefits effective October 18, 2009, after which he reverted back to an EUC claim on May 1, 2010. Claimant did not report his separation from employment with Employer. Claimant was overpaid $5,288.00 in UC benefits, $2,295.00 in EUC benefits, and $225.00 in FAC benefits. (7234 Decision at 1-2; 7233 Decision at 1.)
With respect to the willful misconduct underlying Claimant's termination, the referee noted that it was undisputed that Claimant was aware of Employer's policy that the failure to report his absence or lateness 30 minutes prior to the start of his shift on two consecutive days is cause for discharge. The referee also recognized a conflict in the testimony as to whether Claimant properly contacted Employer regarding his absences on November 19 and 20, 2009, resolved the conflict in Employer's favor, and found Employer's witness's testimony credible that Claimant did not properly report his absence on November 19th and 20th. (7234 Decision at 2.)
Regarding the fault overpayment of UC benefits, the referee found that Claimant received $5,288.00 in UC benefits to which he was not entitled. (7234 Decision at 3.) The referee also found that Claimant contacted the UC authorities on October 23, 2009, via the internet to file a claim for benefits prior to his separation from employment. (Id.) The referee noted that Claimant continued filing claims even though he had returned to work. (Id.) The referee also noted that after Claimant was discharged, he continued to file claims for benefits and did not inform the UC authorities that he had been fired for willful misconduct. (Id.) As a result, based on the evidence contained in the record, the referee found Claimant at fault for his receipt of benefits to which he was not entitled under section 804(a) of the Law. (Id.)
Finally, regarding the overpayment of EUC benefits, the referee noted that Claimant filed an original application for benefits effective January 13, 2008, received EUC benefits beginning in August 2008, filed a new UC claim in October 2009, and reverted back to receiving EUC benefits in May 2010. (7233 Decision at 2.) The referee found that Claimant was ineligible for UC benefits and was overpaid those benefits. (Id.) The referee also found that because Claimant had not exhausted his rights to regular UC benefits due to his ineligibility and overpayment, he was not entitled to EUC benefits under section 4001(b) of the EUC Act. (Id.) However, the referee also determined that the overpayment of EUC benefits would be recoupable under the non-fraud provisions of section 4005 of the EUC Act because there was no evidence that Claimant engaged in an act of fraud to obtain the EUC benefits. (Id.)
Based on the foregoing, the referee issued orders affirming the representative's determinations that Claimant is ineligible for UC benefits under section 402(e) of the Law; affirming the determination that the overpayment of UC benefits is recoupable under section 804(a) of the Law; affirming the determination that Claimant is ineligible for EUC benefits under section 4001(b) of the EUC Act; and affirming as modified the determination that the overpayment of EUC benefits is recoupable under section 4005 of the EUC Act. (7234 Decision at 3; 7233 Decision at 3.)
The orders also affirmed as modified the representative's determinations that Claimant is not entitled to FAC benefits and that the overpayment of FAC benefits was recoupable under section 4005(b), (c) of the EUC Act. (7234 Decision at 4; 7233 Decision at 3.)
On October 12, 2010, Claimant appealed the referee's decisions to the Board. On December 3, 2010, the Board issued orders adopting and incorporating the referee's findings and conclusions and affirming the referee's decision. Claimant then filed the instant petitions for review.,
The appeals were consolidated by order of this Court dated January 31, 2011.
This Court's scope of review in an unemployment compensation appeal is limited to determining whether an error of law was committed, whether constitutional rights were violated, or whether necessary findings of fact are supported by substantial evidence. Section 704 of the Administrative Agency Law, 2 Pa.C.S. §704; Shrum v. Unemployment Compensation Board of Review, 690 A.2d 796, 799 n. 3 (Pa. Cmwlth.), appeal denied, 548 Pa. 663, 698 A.2d 69 (1997).
In this appeal, Claimant asserts that the Board erred: (1) in determining that he engaged in willful misconduct; (2) in determining that he was at fault for receiving UC benefits and that they are recoupable under section 804(a) of the Law; and (3) in determining that he is not entitled to EUC benefits.
Claimant also alleges that the Board erred in determining that he is not entitled to FAC benefits. However, Claimant did not raise this allegation of error in either of his petitions for review. As a result, this claim has been waived for purposes of appeal. Pa.R.A.P. 1513(d); Eck v. Unemployment Compensation Board of Review, 651 A.2d 689, 694 (Pa. Cmwlth. 1994).
Claimant first contends that the Board erred in determining that he engaged in willful misconduct because Employer had failed to sustain its burden of proof in this regard. We do not agree.
Pursuant to section 402(e) of the Law an employee is ineligible for unemployment compensation benefits when he had been discharged from work for willful misconduct connected with his work. Ductmate Industries, Inc. v. Unemployment Compensation Board of Review, 949 A.2d 338, 341-42 (Pa. Cmwlth. 2008). The burden of proving willful misconduct rests with the employer. Id. at 342. Whether an employee's conduct constitutes willful misconduct is a question of law subject to this Court's review. Id. A violation of an employer's work rules may constitute willful misconduct. Id. An employer must establish the existence of the work rule and its violation by the employee. Id. If the employer proves the existence of the rule and the fact of its violation, the burden of proof shifts to the employee to demonstrate that he had good cause for his actions. Cassidy v. Unemployment Compensation Board of Review, 532 A.2d 524, 526 (Pa. Cmwlth. 1987).
In addition, the Board is the ultimate finder of fact in unemployment compensation proceedings. Peak v. Unemployment Compensation Board of Review, 509 Pa. 267, 270, 501 A.2d 1383, 1385 (1985). Thus, issues of credibility are for the Board, which may either accept or reject a witness' testimony whether or not it is corroborated by other evidence of record. Chamoun v. Unemployment Compensation Board of Review, 542 A.2d 207, 208 (Pa. Cmwlth. 1988). Findings of fact are conclusive upon review provided that the record, taken as a whole, contains substantial evidence to support the findings. Taylor v. Unemployment Compensation Board of Review, 474 Pa. 351, 355, 378 A.2d 829, 831 (1977). This Court must examine the evidence in the light most favorable to the party who prevailed before the Board and give that party the benefit of all inferences that can be logically and reasonably drawn from the testimony. Id.
Claimant asserts that there is sufficient evidence demonstrating that he reported his absences to Employer in compliance with Employer's work rule. However, when viewed in a light most favorable to Employer, our review of the certified record in this case confirms that there is substantial evidence supporting the Board's findings regarding the existence of Employer's work rule requiring the reporting of absences 30 minutes prior to the start of a shift, the reasonableness of the work rule, Claimant's knowledge of the work rule, and the fact of its violation. Specifically, the testimony and exhibits of Employer's office manager and warehouse manager support the Board's findings in this regard as they establish that Claimant did not call to report his absence until 11:47 a.m. on November 19, 2009, when his shift started at 7:00 a.m., and that he did not call in at all to report his absence on November 20, 2009, when his shift started at 7:00 a.m. See N.T. 9/24/10 at 9-10, 11, 13-14, 16, 25-26.; Employer Exhibit 1 at 1; Employer Exhibit 2 at 1-4.
"N.T. 9/24/10" refers to the referee's hearing of September 24, 2010.
The Board was free to credit the foregoing evidence regarding the violation of Employer's work rule and to discredit evidence to the contrary. Peak; Chamoun. In addition, those findings are conclusive on appeal as they are supported by the foregoing substantial evidence. Taylor. Because Employer satisfied its burden of proof in this regard, the burden then shifted to Claimant to establish good cause for his actions. Ductmate Industries, Inc.; Cassidy.
In support of his burden, Claimant cites his testimony at the hearing as evidence that he did call Employer in compliance with the work rule. However, the referee's decision adopted by the Board specifically states:
Here, the Referee recognizes a conflict in the testimony and evidence presented by the parties, relative to whether the claimant properly contacted the employer regarding his absences on November 19, 2009 and November 20, 2009. It is not disputed the claimant was absent on those days. The Referee resolves the conflict in the testimony in favor of the employer, and finds the employer witness's testimony credible the claimant did not properly report his absence on November 19, 2009 or November 20, 2009 by not calling 30 minutes prior to the start of his shift. As the Referee does not find the claimant's testimony credible that he contacted the employer in accordance with its policy, the claimant has also failed to establish a good cause reason for [his] failure to do so....(7234 Decision at 2.)
As noted above, the Board is the ultimate finder of fact in unemployment compensation proceedings. Peak; Chamoun. In addition, issues of credibility are for the Board which may either accept or reject a witness' testimony whether or not it is corroborated by other evidence of record. Id. Thus, the fact that there is evidence cited by Claimant which contradicts the Board's determination with respect to the violation of Employer's work rule does not compel the conclusion that the Board's determination in this regard should be reversed. See Tapco, Inc. v. Unemployment Compensation Board of Review, 650 A.2d 1106, 1108-1109 (Pa. Cmwlth. 1994) ("[T]he fact that Employer may have produced witnesses who gave a different version of events, or that Employer might view the testimony differently than the Board, is not grounds for reversal if substantial evidence supports the Board's Findings.").
In short, there is ample substantial evidence demonstrating the existence of Employer's work rule regarding the reporting of absences and the fact of its violation. We will not accede to Claimant's request to revisit the Board's credibility determinations in this regard. Moreover, the Board did not err in determining that Claimant was ineligible for benefits pursuant to Section 402(e) of the Law by violating Employer's work rule. See Kells v. Unemployment Compensation Board of Review, 378 A.2d 495, 496 (Pa. Cmwlth. 1977) ("The real issue is whether or not the claimant's absences were reported to the employer in a proper and timely manner consistent with company rules. It is settled that a failure to so report 'does constitute willful misconduct justifying discharge and precluding the recovery of benefits.' [Unemployment Compensation Board of Review v. Kells, 349 A.2d 511, 513 (Pa. Cmwlth. 1975), citing Ferko v. Unemployment Compensation Board of Review, 309 A.2d 72, 74 (Pa. Cmwlth. 1973). See also Gardner v. Unemployment Compensation Board of Review, 372 A.2d 38, 40 (Pa. Cmwlth. 1977)].").
Claimant next contends that the Board erred in determining that he was at fault for receiving UC benefits and that they are recoupable under section 804(a) of the Law. Again, we do not agree.
Section 804(a) of the Law provides that if a person receives UC benefits by reason of his fault, he will be responsible for repaying the amount received in error plus interest. "The word 'fault' within the meaning of Section 804(a) of the Law connotes an act to which blame, censure, impropriety, shortcoming or culpability attaches." Amspacher v. Unemployment Compensation Board of Review, 479 A.2d 688, 691 (Pa. Cmwlth. 1984). "Conduct that is designed improperly and intentionally to mislead the unemployment compensation authorities is sufficient to establish a fault overpayment." Kelly v. Unemployment Compensation Board of Review, 840 A.2d 469, 473 (Pa. Cmwlth. 2004). For example, an intentional misstatement on an application for benefits can support a finding of fault under section 804(a). Matvey v. Unemployment Compensation Board of Review, 531 A.2d 840, 844 (Pa. Cmwlth. 1987). In order to find fault, the referee or Board must make some findings with regard to a claimant's state of mind. Amspacher, 479 A.2d at 691.
In this case, Claimant testified that he opened a new claim that was effective October 18, 2009, (N.T. 9/24/10 at 7), and the record shows that the initial claim for UC benefits was taken over the internet on October 23, 2009, effective October 18, 2009. (Service Center Exhibit 13 at 3, 6.) However, Employer's records show that Claimant worked over 64 hours between November 8 and 18, 2009. (Employer Exhibit 3.) In addition, Claimant conceded that he was scheduled to work for Employer on November 19, 20, 23, 24 and 25, 2009, (id. at 31-33), and yet the first week for which he received UC benefits at issue herein was the claim week ending November 28, 2009. (Service Center Exhibit 3A.) Moreover, Claimant admitted that he did not inform the UC authorities of his change in employment status after he was fired for his violation of Employer's work rule. (N.T. 9/24/10 at 34.)
Claimant also conceded that he continued filing claims and had received UC benefits for the weeks ending November 7, 14, and 21, 2009, when he was, in fact, still working full-time for Employer. (N.T. 9/24/10 at 30-31.) --------
The foregoing evidence supports the Board's findings, and, thus, the Board properly determined that Claimant is subject to a fault overpayment of UC benefits under section 804(a). See Amspacher, 479 A.2d at 692 ("[W]e feel the above findings ... are indicative of the claimant's state of mind and support an inference of culpability....") See also Summerville v. Unemployment Compensation Board of Review, 688 A.2d 763, 766 (Pa. Cmwlth. 1997) (holding that the claimants' failure to acknowledge that the township that had acquired their employer had offered to continue their employment after the acquisition supports a finding of fault under section 804(a).); Patrick v. Unemployment Compensation Board of Review, 398 A.2d 1095, 1097 (Pa. Cmwlth. 1983) (holding that a claimant's misrepresentation of the reason for his unemployment, a discharge for willful misconduct rather than the stated lay off due to lack of work, supports a finding of fault under section 804(a).); Beres v. Unemployment Compensation Board of Review, 393 A.2d 1073, 1075 (Pa. Cmwlth. 1977) (holding that a claimant's misstatement on his application for benefits that he had lost his job because he was laid off rather than his actual discharge for willful misconduct supports a finding of fault under section 804(a).)
Finally, Claimant contends that the Board erred in determining that he is not entitled to EUC benefits. However, Claimant is not entitled to receive EUC benefits if his separation from employment is due to willful misconduct. See McKenna v. Unemployment Compensation Board of Review, 981 A.2d 415, 417 (Pa. Cmwlth. 2009) ("Eligibility requirements for receipt of regular UC are also applicable to EUC. For example, a claimant must be at least partially unemployed, able and available for suitable work, not disqualified for voluntarily leaving work, and not discharged for willful misconduct.") (citation omitted.) As outlined above, Claimant is not entitled to receive UC benefits due to his termination for willful misconduct. As a result, the Board did not err in determining that Claimant is not entitled to EUC benefits.
Accordingly, the Board's orders are affirmed.
/s/_________
PATRICIA A. McCULLOUGH, Judge ORDER
AND NOW, this 23rd day of February, 2012, the December 3, 2010, orders of the Unemployment Compensation Board of Review are affirmed.
/s/_________
PATRICIA A. McCULLOUGH, Judge