By: Alan E. Seneczko,
Esq.
You
may recall that in January 2014, a completely novel concept, "substantial
fault," was introduced to the Wisconsin Unemployment Compensation system.
(See, Changes
to Wisconsin Unemployment Insurance Coming Soon, Sept. 2013). Under the new
law, in addition to the established "misconduct" standard for
disqualifying terminated employees from benefits (a fairly high standard),
employees terminated for "substantial fault" are now also ineligible
for benefits.
"Substantial
fault" is defined to include "those acts or omissions . . . over
which the employee exercised reasonable control and which violate reasonable
requirements of the employer." It does not include: 1) one or more minor
infractions of rules unless an infraction is repeated after the employer warns
the employee about the infraction; 2) one or more inadvertent errors made by
the employee; and, 3) any failure to perform work because of insufficient
skill, ability, or equipment. Wis. Stat. § 108.04(5g)(a). In other words,
employees terminated for committing minor rule infractions without prior
warnings and inadvertent errors are eligible for benefits.
What
is the difference between a "minor infraction of a rule," which
constitutes "substantial fault" if repeated after warning, and an
"inadvertent error," which does not? Good question. In Operton v. LIRC, 2015
AP1055 (Wis. Ct. App. 2016), a case of first impression, the Wisconsin Court of
Appeals set out to answer this question.
Walgreens
terminated Operton for continuing to make cash handling violations after
receiving multiple warnings for her conduct (eight violations over 20 months),
and contended that her repeated mistakes amounted to "substantial
fault" for purposes of her UC eligibility. The ALJ agreed, and the
Commission upheld the decision. The court of appeals did not.
The
court first noted the difference between an "infraction," which
generally relates to a violation of an established rule, and an
"error," which it described as an "unintentional act or
omission." The court found no evidence that the employee had committed any
infraction of a rule, but rather, that all of her multiple violations amounted
mistakes and unintentional errors. Therefore, since they constituted
"errors" and not "infractions," it did not matter how many
she made, because "one or more 'inadvertent errors,' even if warnings are
given, are not 'substantial fault' under the statute." In response to
Walgreen's contention that the repeated, cumulative effect of the employee's
mistakes had crossed the line into disqualifying conduct, the court held:
"Repeated inadvertent errors do not statutorily morph into 'infractions'
if warnings have been given. Inadvertent errors, warnings or no warnings, never
meet the definition of substantial fault."
At
the end of the day, what this means is that "substantial fault" is
essentially just a lesser degree of "misconduct." That is, in order
to prove a violation, you still need to establish the existence of a rule, the
employee's knowledge of the rule, prior warnings and another violation. (Sound
familiar?) Mistakes, poor performance, lapses in judgment, and similar such
errors are still no basis for the denial of benefits, no matter how frequent.
Questions?
Please contact Attorney Alan E. Seneczko at (262) 560-9696, or email alseneczko@wesselssherman.com.
