Opinion
No. C5-01-1384.
Filed February 12, 2002.
Appeal from the Department of Economic Security, File Nos. 314901, 315001.
Francis Li, (for relator)
Lund Industries, Inc., (respondent)
Philip B. Byrne, Department of Economic Security, (for respondent Commissioner of Economic Security)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2000).
UNPUBLISHED OPINION
Relator Benjamin J. Thrall challenges the commissioner's representative's determination that he was ineligible for unemployment benefits from October 6, 2000 through November 30, 2000 and must consequently repay all benefits received during that period. He contends that the "stay-pay bonus" he received on his last day of employment does not constitute severance pay under Minn. Stat. § 268.085 subd. 3(a)(1) (2000). We affirm.
FACTS
On April 26, 2000, Thrall, an employee of respondent Lund Industries, Inc., was notified that Lund Industries was planning a permanent layoff. Thrall was advised that those employees who continued to work until the layoff date would be eligible for a "stay-pay bonus." The employees were also told that the amount of bonus payment would be based upon each individual's length of employment and hourly wage rate.
Thrall was notified that his last day would be October 5, 2000, and he continued to work until that date. He received a stay-pay bonus of $6,590.40, which represented 12 weeks of pay at his hourly wage rate of $13.73. Thrall received 12 weeks of pay because he had been employed with Lund Industries for more than 48 months. This amount was paid to Thrall on his last day of work. Thereafter, Thrall filed for unemployment benefits. He was paid $1,464 in unemployment benefits for the weeks ending October 21, 2000 through December 9, 2000.
On February 28, 2001, the Minnesota Department of Economic Security sent Thrall a letter stating that the "stay-pay bonus" he received was considered severance pay under Minn. Stat. § 268.085 (2000). Consequently, the department determined that Thrall was ineligible to receive unemployment benefits during the period of October 6, 2000 to November 30, 2000. On March 1, 2001, the department sent Thrall a letter stating that he had been overpaid $1,464 in unemployment benefits and was required to refund that amount.
Minn. Stat. § 268.085, subd. 1(3) requires a one-week waiting period after the date of eligibility before benefits can be collected. Since Thrall was determined ineligible from October 6, 2000 to November 30, 2000, the one-week waiting period would also make him ineligible for benefits during the period of December 3, 2000 through December 9, 2000.
Thrall appealed the ineligibility and overpayment determinations to an unemployment law judge. A hearing took place, and the judge affirmed both the ineligibility determination and the overpayment determination. Thereafter, Thrall appealed the unemployment law judge's decision to the commissioner's representative. The commissioner's representative affirmed the unemployment law judge's decision. Thrall now appeals the representative's decision by writ of certiorari.
DECISION
Thrall contends that the commissioner's representative erred by determining that he was ineligible for unemployment benefits for the period of October 6, 2000 to November 30, 2000. The commissioner's representative's findings of fact should be reviewed in the light most favorable to the decision and should not be disturbed if there is evidence in the record that reasonably tends to sustain them. Ress v. Abbott Northwestern Hosp., Inc., 448 N.W.2d 519, 523 (Minn. 1989). This court is not bound, however, by the commissioner's representative's conclusions of law and may exercise its independent judgment on questions of law. McGowan v. Executive Express Transp. Enters., Inc., 420 N.W.2d 592, 594 (Minn. 1988). The ultimate determination that a person is ineligible for unemployment benefits presents a question of law subject to de novo review. Ress v. Abbott Northwestern Hosp., Inc., 448 N.W.2d 519, 523 (Minn. 1989).
Eligibility for unemployment benefits is controlled by statute:
(a) An applicant shall not be eligible to receive unemployment benefits for any week with respect to which the applicant is receiving, has received, or has filed for payment in an amount equal to or in excess of the applicant's weekly unemployment benefit amount in the form of:
(1) a severance payment. This clause shall apply to the first four weeks of payment and to one-half of the total number of any additional weeks of payment.
Minn. Stat. § 268.085, subd. 3 (2000). Thus, if Thrall's "stay-pay bonus" is considered severance pay, he would have been ineligible for benefits during the period at issue.
The construction of a statute is a question of law and therefore fully reviewable by an appellate court. Hibbing Educ. Ass'n v. Pub. Employment Relations Bd., 369 N.W.2d 527, 529 (Minn. 1985).
While this court is not bound by an agency's conclusions of law, the manner in which an agency has construed a statute may be entitled to some weight when the statutory language is technical in nature and the agency's interpretation is one of longstanding application.
Lolling v. Midwest Patrol, 545 N.W.2d 372, 375 (Minn. 1996) (citing Arvig Tel. Co. v. Northwestern Bell Tel. Co., 270 N.W.2d 111, 114 (Minn. 1978); see also Minn. Stat. § 645.16(8) (2000) (stating that intention of legislature may be ascertained by considering administrative interpretations of statute). Here, however, the statutory language at issue is not technical in nature, nor has there been longstanding application of an agency interpretation. Therefore, no weight need be given to the commissioner's representative's decision.
Under prior law, unemployment insurance statutes were remedial and were to be construed liberally in favor of awarding benefits, and disqualification provisions were to be narrowly construed. McGowan, 420 N.W.2d at 595; Smith v. Employers' Overload Co., 314 N.W.2d 220, 221-22 (Minn. 1981). After recent legislative changes, however, "[t]here shall be no presumption of entitlement or nonentitlement to unemployment benefits." Minn. Stat. § 268.069, subd. 2 (2000).
This court has recently interpreted the definition of "severance payment" as used in Minn. Stat. § 268.085 (1998). Carlson v. Augsburg Coll., 604 N.W.2d 392, 394-95 (Minn.App. 2000). In Carlson, this court examined whether the use of the term "settlement payment" in a separation agreement prevented that payment from being considered a severance payment. Id.
Section 268.085 does not define the term "severance payment." Severance pay means a sum of money usually based on length of employment for which an employee is eligible upon termination. If statutory language is plain and unambiguous, this court must give it its plain meaning. Here, appellant received payment from his employer equal to his salary, at regular intervals, through May 1999. In view of the evidence in the record, the commissioner's representative did not clearly err in determining that Carlson collected "severance" pay within the meaning of Minn. Stat. § 268.085, subd. 3.
Id. (quotation and citations omitted).
Carlson defines severance payment as a sum of money payable on termination of employment that is based on length of employment. Id.; see also The American Heritage Dictionary 1652 (3rd ed. 1992) (defining "severance pay" as a "sum of money usually based on length of employment for which an employee is eligible upon termination"). Here, it is undisputed that the amount of "stay-pay bonus" was based largely on Thrall's length of employment with Lund Industries. It is also undisputed that the "stay-pay bonus" was paid to Thrall on the date his employment terminated.
Thrall argues that Carlson is distinguishable. While the facts in Carlson are indeed quite different from the facts here, the case's applicability is not affected. This court's interpretation of the term "severance payment" in Carlson is not limited to the factual context of the case.
Thrall also argues that the "stay-pay bonus" is not severance pay because his employer did not view the bonus as severance pay, but rather viewed it "as an incentive to keep its employee on the job until the last day of work." How an employer chooses to label a payment, however, is not determinative in deciding whether unemployment benefits should be paid.
Unemployment benefits are paid from state funds and shall not be considered paid from any special insurance plan, nor as paid by an employer. An application for unemployment benefits shall not be considered a claim against an employer but shall be considered a request for unemployment benefits from the fund. The commissioner has the responsibility for the proper payment of unemployment benefits regardless of the level of interest or participation by an applicant or an employer in any determination or appeal.
Minn. Stat. § 268.069, subd. 2 (2000).
Carlson is controlling. The "stay-pay bonus" is considered a severance payment under Minn. Stat. § 268.085, subd. 3. Additionally, we note that the legislature amended section 268.085, subdivision 3 during the 2001 legislative session to read:
(a) An applicant shall not be eligible to receive unemployment benefits for any week with respect to which the applicant is receiving, has received, or has filed for payment in an amount equal to or in excess of the applicant's weekly unemployment benefit amount in the form of:
(1) severance pay, bonus pay, vacation pay, sick pay, and any other money payments, except earnings under subdivision 5, and back pay under subdivision 6, paid by an employer because of, upon, or after separation from employment that are considered wages under section 268.035, subdivision 29, or United States Code, title 26, section 3121, clause (2) of the Federal Insurance Contribution Act.
2001 Minn. Laws ch. 175 § 29. The parties agree that this new language does not apply retroactively to the case before us.