Yesterday, the Ohio Court of Appeals affirmed the denial of unemployment compensation to an employee who failed to obtain a new certification required by her job despite being given eleven months to do so before she was fired. Farrar v. Univ. Hosp. Health Sys., Inc., 2024-Ohio-5374. The court found that the employer had just cause to terminate her employment because she was not without some fault in her delay in obtaining the newly required certification, which she blamed on her ignorance that her employer would have reimbursed her expenses if she passed the test. The court did not find that she was “unsuitable” because the employer failed to notify her of the new requirement when it purchased her former employer and this was not a promotion which was conditioned on the certification requirement. Nonetheless, the Court found that she was not the victim of economic or business conditions, which was the underlying purpose of unemployment compensation.
According to the Court’s opinion, the claimant had been
hired as a medical coding specialist in 2014.
Her employing hospital was acquired by her new employer in May
2021. In December 2021, it imposed a new
requirement on medical coders to obtain certification by June 30, 2022. The claimant was unaware that the employer would
provide study materials at cost or reimburse her for all of her expenses to
take the test if she passed. The employer
indicated during the unemployment hearing that the test was offered every two
weeks. The claimant did not attempt to
take it until June 2022 and she failed.
She was given an extension until December 1, but she did not try again to
take it until November. She again
failed. She indicated that she was
planning to retake the test when she was fired on December 1, 2022.
Typically, an employee is not found to have been at fault if
s/he is unable to meet a new condition of employment. The Ohio Supreme Court’s test in Tzangas
indicates that just cause requires proof that the employee’s job performance
was unsatisfactory based on expectations that were established at the time of
hire and the “requirements of the job did not change substantially since the
date of the original hiring for that particular position.” Later decisions have found that this same
test applies to promotions – i.e., an employee is at fault if s/he fails to obtain
a required certification required as a condition of a job promotion. In this case, the employer implied that the
claimant had been hired at the time the employer acquired her former
employer. However, the evidence
indicated that the certification requirement was not communicated to the
claimant until the following year and the job description had been revised accordingly. Therefore, the employer could not rely on Tzangas
to prove that she had been unsuitable for the medical coder position.
Nonetheless, the court found that the Tzangas test
was not the only basis to find an employee to be at fault for their
unemployment.
{¶14} “Just cause” within the
meaning of R.C. 4141.29(D)(2)(a) “‘“is that which, to an ordinarily intelligent
person, is a justifiable reason for doing or not doing a particular act.”’” . . . “The determination whether there is just cause
for discharge depends upon the factual circumstances of each case.” . . . “‘[W]hat constitutes just cause must be
analyzed in conjunction with the legislative purpose underlying the
Unemployment Compensation Act. Essentially, the Act’s purpose is “to enable
unfortunate employees, who become and remain involuntarily unemployed by
adverse business and industrial conditions, to subsist on a reasonably decent
level and is in keeping with the humanitarian and enlightened concepts of this
modern day.”’” . . .
{¶15} Accordingly, although an
employee’s behavior need not amount to misconduct, the employee must have borne
some fault to establish “just cause” for a discharge for purposes of
unemployment compensation. . . . Fault has been recognized in a variety of
situations, including “willful or heedless disregard of a duty, a violation of
an employer’s instructions, or unsuitability for a position.”
. . .
{¶21} However, appellees have
provided no authority standing for the proposition that a change in ownership
of an employer necessarily results in a new “hire” of a retained employee for
purposes of applying the Tzangas unsuitability test. Further, although
appellees maintained at oral argument that the acquisition occurred in May
2021, the record does not appear to contain the date in 2021 that University
Hospitals acquired Lake Health Hospital.
. . .
{¶30} However, again, unsuitability
is only one of several bases of a finding of just cause for a discharge. . . . Thus, contrary to Farrar’s position in her
brief, it does not follow that, where the Tzangas test is unsatisfied,
an employee is not at fault for the discharge for purposes of just cause.
Instead, as previously addressed, whether just cause exists is dependent on the
factual circumstances of the case, viewed in light of the purposes of the Unemployment
Compensation Act. . . . Here, the review commission considered the
particular facts of this case: on January 1, 2022, University Hospitals
notified the coding specialists, including Farrar, of the requirement that they
obtain coding certification within six months; Farrar failed to meet the
deadline due to personal and financial reasons; University Hospitals provided
extensions of the deadline, allowing her until November 30, 2022 to pass a
certification examination; and Farrar failed to pass a certification
examination prior to November 30, 2022. The review commission concluded that
these facts demonstrated sufficient fault on behalf of Farrar to deem her
discharged for just cause. Such a conclusion is consistent with the underlying
purposes of the Unemployment Act. As the Ohio Supreme Court has cautioned:
The Act does not exist to protect
employees from themselves, but to protect them from economic forces over which
they have no control. When an employee is at fault, [s]he is no longer the
victim of fortune’s whims, but is instead directly responsible for h[er] own
predicament. Fault on the employee’s part separates h[er] from the Act's intent
and the Act’s protection. Thus, fault is essential to the unique chemistry of a
just cause termination.
NOTICE: This summary is designed
merely to inform and alert you of recent legal developments. It does not
constitute legal advice and does not apply to any particular situation because
different facts could lead to different results. Information here can change or
be amended without notice. Readers should not act upon this information without
legal advice. If you have any questions about anything you have read, you
should consult with or retain an employment attorney.
