Ohio Court Denies Unemployment Compensation to Employee Who Failed to Obtain New Certification Required by Employer

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.

Unemployment Compensation Claims Can Be Tricky

Last month, two Ohio Courts of Appeals affirmed the denial of unemployment compensation.  In one, the Court agreed that the claimant had been fired without just cause on her part due to a physical impairment and failure of the employer to discuss or explore possible reasonable accommodations.  However, she was denied compensation because she had improperly restricted her job search to work-from-home positions, thus making herself unavailable for suitable work, including from employers who might have accommodated her temporary impairment.  Hines v. Dir., Ohio Dept. of Job & Family Servs., 2023-Ohio-4066.    In the second, claimant was fired for refusing the COVID vaccine on religious grounds and the hearing officer found her pro-life views – articulated for the first time in the hearing – were not sincere.  Cyriaque v. Dir., Ohio Dept. of Job & Family Servs., 2023-Ohio-4203.

According to the court's opinion, in the first case, the claimant had been working in her clerical position from home for 14 months when the employer announced that it wanted her to return to the office.  She did so for several months until she was diagnosed with a temporary medical condition (which required surgery) and her physician provided a note requesting that she work from home until a treatment plan was developed.  She proceeded to work from home after providing the note to her employer, but was fired for being absent after only one day of working from home.  The employer apparently made no effort to discuss or explore accommodations with her.  She applied for unemployment compensation, but restricted her job search to remote positions because of her medical restriction.  The ODJFS found that she had been terminated without just cause, but denied compensation because she was not able and available for suitable work by restricting her job search to remote positions.

During the hearing, the Claimant explained that she suffered from a temporary condition that will be corrected by surgery.  She was only applying for remote positions and was physically capable of working full-time.   After the denial of benefits was affirmed on appeal, she finally retained an attorney to appeal the decision to court.

The Court explained that to be entitled to unemployment compensation, the claimant must be both physically able and readily available for suitable work:

R.C. 4141.29 governs an individual’s eligibility and qualifications for unemployment benefits due to involuntary employment. Relevant to the appeal, no individual is entitled to benefits for any week unless the individual “[i]s able to work and available for suitable work.” R.C. 4141.29(A)(4)(a)(i).

“One can be able to work but unavailable” . . . .  By definition, the phrase “able to work” means “physical capability to work,” while “available for work” means “readiness to work.”  . . .  “To be available for work within the meaning of the statute, one must be ready, willing, and waiting to accept suitable employment, and must be exposed to the labor market.”

                . . .

[Her] restriction that she only works from home due to her medical condition is too prohibitive and an undue barrier which prevents her from working in all forms of suitable employment. That barrier has not been lifted as [she] is still under the restriction that she works from home until she has surgery. Under the circumstances, this Hearing Officer finds [she] is not available for work and is ineligible for benefits [for] the period beginning September 18, 2022. [She] remains ineligible for benefits until she can show she is available for work without restriction and otherwise eligible for benefits . . .

The Claimant argued that the Commission had improperly created a rule against limiting job searches to remote positions in violation of the statute “because it did not consider the factors listed in R.C. 4141.29(F) in determining whether work-from-home positions were the only suitable work for her based on her medical condition.”  The Court disagreed:

R.C. 4141.29(F) provides in pertinent part:

[I]n determining whether any work is suitable for a claimant in the administration of this chapter, the director * * * shall consider the degree of risk to the claimant’s health, safety, and morals, the individual’s physical fitness for the work, the individual’s prior training and experience, the length of the individual’s unemployment, the distance of the available work from the individual’s residence, and the individual’s prospects for obtaining local work.

The Court found that “the section only requires the Commission to consider these factors in deciding whether “work is suitable for the claimant”; it does not require that the Commission affirmatively identify the factors or make specific findings regarding these factors.”  The Court also found that the hearing officer had considered and asked the claimant questions relevant to these factors:

The hearing officer asked [her] about her medical condition and what limitations it placed on her ability to work. She testified that her condition did not prevent her from physically being able to work because she was still able to move and type and perform her duties. (Record at p. 82.) She also explained that nothing would interfere with her ability to work full time during normal business hours, nor would her condition render her physically incapacitated for any specific day or time. Id. at p. 82, 85. In fact, she stated that if her condition “flared-up,” it was a “quick fix.” Id. at p. 85. [She] also stated that she is “not restricted” in her capability, but “temporarily unable to go into a physical facility with the proper bathroom facility” for her — “I am able to work. I’m not restricted as far as that goes.”

The Court refused to re-weigh the facts of the case and found the ODJFS had identified sufficient evidence to support its decision:  she “was obligated to be available for all jobs that might be suitable opportunities, including office jobs that could accommodate her considering her medical condition.”   “The fact that reasonable minds might reach different conclusions is not a basis for the reversal of the [Commission’s] decision.”

Her physician’s statement only indicated a need for a temporary accommodation, not a need to work from home indefinitely.  “These statements do not support [her] belief that she had to apply for only remote jobs; rather they support that [she] would need an accommodation.”   In limiting her job search to remote positions, she had improperly limited her job search.  The court agreed with similar prior decisions that “a claimant cannot unilaterally determine what work is suitable or not suitable, or self-impose limitations or conditions on suitable work when a claimant conducts her job search.”

[Her] temporary medical condition that requires an accommodation is separate from her availability for suitable work. Granted, it seems futile to have a claimant search for all areas of suitable employment and then seek an accommodation once employment is offered. However, it is possible that some employers may not advertise the possibility of remote or hybrid employment. . . . Limiting a job search to only work-from-home employment would exclude those precise opportunities or employers who offer accommodations to those individuals who require them.

Finally, this court further finds that the Commission’s decision did not create “a blanket rule” that anyone seeking only work-from-home jobs is not eligible for unemployment compensation benefits. Whether someone is available and seeking suitable work depends on the facts and circumstances of each case. . . . Accordingly, there can never be a bright-line test for when a person is determined to be “available” and what work will be deemed “suitable.” . . .  Accordingly, this court’s decision is limited to the specific facts, circumstances, and procedural posture of this particular case. This decision does not foreclosure the possibility that a claimant would be eligible for unemployment benefits when the claimant seeks and requires only work-from-home positions when the facts and situation warrant.

According to the court's opinion, in the second case, the claimant was terminated after refusing to be vaccinated on religious grounds (from Psalm 91).  When she appealed the denial of unemployment compensation, she and her pastor then articulated that the vaccines had been developed using aborted fetus cells, in violation of their pro-life beliefs.  The hearing officer affirmed the denial on the grounds that her religious objections were not sincere.    The claimant appealed. 

Beliefs grounded in religion are protected by the Free Exercise Clause to the United States Constitution, which grants special protection to the exercise of religion. Because of this protection, unemployment benefits cannot be denied from a terminated employee when the termination – whether initiated by the employer or the employee – is the result of the employee’s sincere religious beliefs that prevent her from complying with a condition of employment. In such a circumstance, the termination violates the Free Exercise Clause and is without just cause.

Whether an employee’s belief is sincere is a factual question.  In this case, the Court observed that the claimant and her pastor never mentioned their pro-life beliefs to the employer before she was fired.  She only refused the vaccination on the grounds that she was a Christian:

[Her] exemption request form  . . . did not include any reference to the use of cell lines obtained from aborted fetuses in the creation or testing of the Covid-19 vaccines. Likewise, neither of the two  . . . documents executed by her pastor and submitted to her employer along with her request form set forth any specific reference to the use of fetal cell lines in relation to the vaccines. Indeed, it was not until after her exemption request was denied, and shortly before the telephone hearing, that her pastor wrote the . . .  letter directly articulating the relationship between the vaccines and fetal cell lines and asserting that this relationship implicated the church’s opposition to abortion.

The hearing officer was entitled to assess the claimant’s credibility:  “This contrast between [her] statement provided to [her employer] and her hearing testimony provided support for the hearing officer’s finding that [her] exemption request was not premised upon her sincere religious opposition to the COVID-19 vaccines.”  The Court found that the hearing officer was not required to accept the sincerity of her beliefs simply because they were unrebutted. “In other words, merely reciting a claim of a religious belief does not establish the sincerity of that belief.”

The Court upheld the hearing officer’s exclusion of her pastor’s testimony because her attorney conceded that the pastor would not say anything beyond what was in the letter already admitted into evidence.  Although invited to do so, the attorney did not object and thus waived the objection.  It was not plain error to exclude testimony that would be duplicative of other evidence.

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.

Unemployment Claims Denied When Employees Resigned Without Good Cause

This Spring has brought a couple of interesting unemployment compensation decisions.  In the first, the claimant was denied compensation when he resigned because of fear of contracting COVID.  In the second, the claim was denied because the employee resigned his job without discussing his concerns with an offered promotion before turning it down.

Last month, the Franklin County Court of Appeals affirmed the denial of Pandemic Unemployment Assistance benefits, which had been previously approved, based on a warehouse worker’s fear of contracting COVID.  King v. Dir., Ohio Dept. of Job & Family Servs., 2023-Ohio-1724.  The claimant had resigned his position in May 2020 out of fear of contracting COVID.  He was initially awarded and collected approximately $10k in pandemic unemployment benefits over the next year.  However, his benefits were later disallowed and he was ordered to repay the benefits.  His appeal was denied, but the Commission granted his request to waive the overpayment collection.  He still appealed his denial of PUA to the common pleas court, but never filed a brief.  Unsurprisingly, the trial court denied his appeal because it is required to affirm the Commission if there is any competent and credible evidence in the record supporting its decision.  “Here, the evidence before the commission demonstrated, after the COVID-19 public health emergency began, [the claimant] left his employment as an Amazon warehouse worker due to his fear of contracting this disease. But an individual’s general fear of exposure to COVID-19 at the workplace is not one of the listed qualifying conditions set forth in 15 U.S.C. 9021(a)(3)(A)(aa) through (kk).”

In April, the Lucas County Court of Appeals also affirmed the denial of unemployment insurance to a claimant who lost both his full-time job and part-time job during the pandemic, after he turned down or resigned from a new full-time job offered by his previous part-time employer without adequately discussing his objections to the job offer.  Mason v. Emerald Environmental Servs., Inc., 2023-Ohio-1418.  While the hearing officer referenced both issues, she only cited to the statutory section about resigning a job without just cause.

After the claimant had been laid off from his full-time university job, his part-time employer explained that it was restructuring his part-time position offered him a full-time job with benefits, but paying slightly less per hour than his previous part-time job being managed out of a different location.  Feeling that it would involve too much travel away from his sick girlfriend and his five children, he claimed that he turned it down without discussing his specific concerns with the employer.  The employer explained that he had initially accepted the job, but then changed his mind because of his sick girlfriend.  The employer explained that it would not have involved significant travel and would have relayed that information to him if he had previously articulated that concern.  There was also testimony that the employer would have continued to employ him part-time if he had expressed interest. 

Typically, an employee has the right to resign if the employer materially changes their job, but they first need to discuss it with the employer to give the employer the opportunity to correct the situation.  In this case, the Commission determined that the employee quit without just cause because he was offered a full-time job (after losing his full-time university job) when it was explained that his part-time job was being restructured and he declined the full-time job without explanation.  The employee never established that he had been laid off or when he was fired from his part-time job.  Rather, he said that there had just been a series of discussions.  Therefore, there was sufficient evidence in the record to support the Commission’s conclusion that he had resigned and not been fired.

The Commission determined that he lacked just cause to resign his employment when he was offered a position paying $920/week (more than his $250/week part-time wages) and he failed to have any meaningful discussion about the working conditions before turning it down.  Had he discussed his concerns with his employer, he would have learned that his was being paid more  (because of the health insurance and retirement benefits) and would be travelling approximately the same amount or less as he had been. Finally, he would have been able to remain working part-time if that appealed to him more.  Because he was not involuntarily unemployed through no fault or agreement of his own, he was not entitled to unemployment compensation.

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.

Unemployment Denied to Unvaccinated Claimant Who Restricted Job Search Because of COVID Fear

Last month, the Franklin County Court of Appeals affirmed the denial of unemployment compensation to a claimant who restricted her 2021 job search to small and remote classrooms in order to avoid being exposed to COVID while she was unvaccinated and she claimed her husband’s health made him more susceptible.  Yang v. Ohio Dept. of Job & Family Servs., 2022-Ohio-4480. The claimant had not preserved any medical excuses that she might have been able to raise by not raising them with ODJFS or the Unemployment Review Commission and had admitted that she had restricted her job search to small classroom or remote settings, even though she had applied for two jobs each week.   She had even refused to explain why she was still unvaccinated.   The Court never mentions why ODFJS realized that she had been restricting her job search and began denying her application, but she apparently admitted during the review hearing that she had failed to apply for positions in larger schools or classrooms because of her vaccination status and fear of being exposed to COVID.

According to the Court’s opinion, she had been laid off shortly after the COVID pandemic began and was told that she would not be hired for the following 2020-21 school year.  Her initial March 2021 unemployment compensation application was approved, but in May 2021, the Director denied all further applications on the grounds that she was unavailable for suitable work between March and August 2021.  (She was apparently rehired by Dublin Schools – where she had been assigned by her employer since 2013—in August 2021).   After an evidentiary hearing on her appeal, the Commission affirmed the denial of her benefits on the grounds that she was not able and available for work as required by Ohio Revised Code § 4141.29(A)(4) when she restricted her job search to small and remote classroom settings.   On appeal, the common pleas court affirmed and the Court of Appeals likewise affirmed.

R.C. 4141.29(A)(4) provides in relevant part that only involuntarily unemployed claimants shall receive benefits and will not receive such benefits unless he or she:

(4)(a)(i) Is able to work and available for suitable work and, except as provided in division (A)(4)(a)(ii) or (iii) of this section [when the claimant’s employer expects to recall the claimant within a certain number of weeks], is actively seeking suitable work either in a locality in which the individual has earned wages subject to this chapter during the individual's base period, or if the individual leaves that locality, then in a locality where suitable work normally is performed.

Courts are required to affirm the Commission under Ohio law if there is any evidence in the evidentiary record to support its determination.   Her admission that she would have rejected job offers from large high and middle schools was found to justify the denial of her unemployment compensation application in the absence of valid legal arguments for her unsupported medical explanation.  In short, she was not making herself available for suitable work by restricting her job search.  

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.

Unemployment Compensation Claimant Fined and Penalized for Knowingly Underreporting Bartending Tips and Income Each Week

Earlier this month, the Stark County Court of Appeals concluded that an unemployment compensation claimant was liable for a substantial fine and denial of future u/c compensation as a penalty for knowingly understating her bartending income after she had been laid off from her steel plant job. Carden v. Ohio Dept. of Job & Family Serv., 2022-Ohio-2786.    In short, the claimant reported that she was receiving $100/week in bartending wages and tips, when she knew that she was being paid more than that and never updated or changed her weekly estimate.  Not only was she responsible for repaying the $4,820 overpayment, but she was also fined 25% -  $1,205 -- and declared ineligible for 18 weeks of u/c if she applied again before 2027 due to her fraudulent claims.  Although the common pleas court relieved her of the fine and ineligibility sanction on the grounds that it was an honest mistake, the appellate court found fraudulent intent was implied by her admitted knowledge of her repeated erroneous reports.

According to the Court’s opinion, the claimant took a part-time bartending job after she was laid off.  When she filed her initial reports, she reported $100 in weekly income and did not amend or change her weekly reports after she started to receive tips in her paychecks on top of her hourly wages. She “testified she did not know she could amend her claim after receiving her paychecks, and did not know she could wait to report her earnings until she received her paycheck.”  However, when it was pointed out that a booklet had been “mailed to her which explained this procedure for reporting and amending claims, she testified she did not recall receiving the booklet, although she admitted she might have” and just “didn’t understand it fully.”   She admitted that there was not “a week where she had no tip income, although tip income varied.”

While other counties require a subjective intent to take from the State that to which the claimant is not entitled, this Court noted that it had previously ruled that fraudulent intent for purposes of filing false unemployment claims does not require a subjective intent:

“[F]or purposes of [R.C. 4141.35], fraud simply refers to the making of a statement that is false, where the party making the statement does or should know that it is false.”  . . . The party's “subjective intent * * * is irrelevant to a determination of whether [he or she] made fraudulent misrepresentations pursuant to R.C. 4141.35.” Id. at ¶ 35. The intent to commit fraud may be inferred from intrinsic or extrinsic evidence, as well as from the surrounding circumstances.

The hearing officer had found that individuals are deemed to intend the natural consequences of their actions.  She admittedly knew that her weekly reports were inaccurate, but made no effort to correct them and merely continued reporting the same incorrect amount every week.  The common pleas court found that she was overwhelmed by the stress of her layoff and raising four children, simply did not understand the process and would not have reported any earnings if she had intended to commit fraud.  Yet, under the standard for reviewing administrative decisions, the trial court was bound to affirm the UCBR’s decision if there was any evidence in the record to support it, instead of re-weighing the evidence. “Regardless of whether or not she reviewed and understood the booklet, she knew or should have known she was consistently under-reporting her income, yet failed to amend her earnings reports.”

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.

Unemployment Compensation Denied When Physician Indicated Claimant Had No Work Restrictions But Would Know When to Leave Job

 Last week, a divided Franklin County Court of Appeals affirmed the denial of unemployment compensation to a claimant who had given notice of resignation and then a week later failed to return to work. Boynton v. Ohio Dept. of Job & Family Servs., 2022-Ohio-2597.   The Court found that the employee did not have “just cause” to resign her position because she had failed to first attempt to resolve any issues with her employer before submitting her resignation.   Moreover, her physician had stated that he had not placed her on work restrictions or advised her to quit her job, rendering her medical complaints irrelevant. 

According to the Court’s opinion, the claimant had worked as a cashier for a retail establishment for a few years.  Because of, among other things, lower back pain, her employer had accommodated all of her requests, including reducing her work hours and permitting her to rest one leg on a basket.   However, one day, she indicated that she was giving her two-week notice of resignation for several reasons, including to care for her ill fiancé, her low back pain and dissatisfaction with the employee rewards system.  After a disagreement with a co-worker a week later, however, she informed the manager about her emotional distress, and left work early.  She later told her manager that she would not be returning to finish her two-week notice because of COVID concerns. 

The Court noted that employees cannot receive unemployment compensation following a voluntary resignation unless they had just cause to resign

"Traditionally, just cause, in the statutory sense, is that which, to an ordinarily intelligent person, is a justifiable reason for doing or not doing a particular act." Rider v. Dir., Ohio Dept. of Job & Family Servs., 10th Dist. No. 16AP-854, 2017-Ohio-8716, ¶ 9. Under this standard, " 'an employee is required to cooperate with the employer to resolve work-related problems. * * * If the employee does not cooperate or give the employer sufficient time to accommodate the employee's needs [and] concerns, that employee will usually not be found to have just cause if he or she quits.' " . . . " 'Essentially, an employee must notify the employer of the problem and request it be resolved, and thus give the employer an opportunity to solve the problem before the employee quits the job; those employees who do not provide such notice ordinarily will be deemed to quit without just cause, and, therefore, will not be entitled to unemployment benefits.' "

The claimant did not dispute that she failed to discuss her reasons for resignation with her employer before her resignation, except with respect to her medical ailments.   However, again, there was no evidence that she had ever indicated that the accommodations that she had requested and been provided were inadequate prior to her resignation (although there was evidence that the accommodations had not resolved her back pain issues).   She had provided with her unemployment application a statement from her treating physician that he had never placed her on work restrictions or advised her to resign, but that she would know when it was time to leave.

The ODJFS found that she lacked good cause to resign because she had not attempted to resolve with her employer any of these three issues before giving notice.  The Court’s majority found that there was adequate evidence in the record to support this conclusion. 

The dissent found that the physician’s comment that “she will know when it is time to not work anymore” satisfied her burden of proving good cause because it was clear no reasonable accommodation would be possible to permit her to continue working as a cashier.  The employer also had been on notice that her prior accommodations had not solved the issue with her back pain, but made no further suggestions.    Further, the dissent would not penalize her for leaving work prior to the completion of her two-week notice because she had been unwell and was legitimately concerned about COVID. 

Ohio Appeals Court Denies Unemployment to Employee Claiming Continued Harassment

Earlier this month, the Franklin County Court of Appeals unanimously affirmed the denial of unemployment compensation to an employee who resigned following her second complaint about her supervisor sexually harassing her.  Loughman v. Ohio Dept. of Pub. Safety, 2016-Ohio-1086.   Within a few months of being hired, the claimant complained about her supervisor sexually harassing her and he was disciplined following an investigation.   She returned to working for him and complained six months later that the harassment continued.  She was transferred into another position pending the investigation and offered four other possible positions in different sections (away from her former supervisor).   Plaintiff abruptly resigned her position a week later and filed for unemployment compensation on the grounds that she had been subjected to intolerable conditions when the harassment did not stop after her first complaint.  The Court  concluded that the employee’s resignation was unjustified under the circumstances because her second complaint was still under investigation and she had been immediately removed from the allegedly harassing situation once she made her second complaint.

In order to show that an employee was justified in resigning, the employee must first bring the intolerable situation to the employer’s attention in order to give the employer a realistic opportunity to cure the situation before the employee resigns.   If the employer fails to correct the situation, the employee may be justified in resigning and need not indefinitely subject herself to a hostile work environment.  In this case, the employee failed to explain how the employer’s discipline of the harassing supervisor following her initial complaint was insufficient.  She did not raise the issue again for six months and never alleged that the employer was aware before then that the harassment had continued.

She also could not show that the employer’s response to her second complaint was insufficient because she was immediately removed from the harassing situation, offered another position and began a second investigation (which had not yet concluded at the time she resigned).

The Court also refused to excuse the employee of the obligation to notify it of a medical condition which contributed to her resignation.

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 be changed or 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.

Injured Firefighter Collects Unemployment During Unpaid Sick Leave

Near the end of December, the Ohio Court of Appeals affirmed the award of unemployment compensation to an injured firefighter who was placed on unpaid sick leave after he exhausted light duty assignments upon reaching maximum medical improvement under the applicable bargaining agreement and after he was denied permanent disability compensation.  Akron v. Dir., Ohio Dept. of Job & Family Servs., 2015-Ohio-5376.  The Court agreed that he was able to work in light duty positions and that he had had been available for work while his union and the employer discussed other possible light duty assignments.   The Court rejected the employer’s argument that the employee had not been available for work because he had not searched for other jobs after being placed on unpaid sick leave.  The employee was not required to produce evidence of his job search activities unless the Director of Job and Family Services requested it and no such request was ever made or required to be made.   Finally, the Court rejected the argument that the employee’s right to unemployment compensation had been waived by the bargaining agreement because the agreement did not made his placement on an indefinite sick leave.

While the unemployment compensation statute precludes contractual waivers of unemployment benefits, the courts have recognized a common law waiver when a union negotiates termination benefits:  

When an employee has a termination package pursuant to a collective-bargaining agreement between [his] union and the employer, the employee is deemed to have accepted the benefits of the package, and waived [his] right to benefits, in return for [his] agreement to be terminated at a certain time. . .  . “The termination when a collective-bargaining agreement exists is deemed to have been for just cause, rendering the employee statutorily ineligible for unemployment compensation.

However, this exception did not apply in this case because the employee was not terminated in accordance with a collectively-bargaining retirement package.   Instead, he was placed indefinitely on unpaid sick leave.  “There is no indication as to how long Mr. Gardner could have remained on this leave status and no indication in the record that this leave status was required by the terms of any agreement between his union and the City.”   Accordingly, the Court refused “ to extend common law waiver to the circumstances present in this case, where there is no termination package at issue, where the leave at issue could last indefinitely, and where the leave at issue was not contemplated as part of any collectively bargained agreement in the record.”

 On a completely different topic, Ohio has a new minimum wage poster for employers and wage for employees to coincide with the new year.

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 be changed or 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.

Ohio Appeals Courts Rule in Favor of Unemployment Claims and Affirm Hearing Officers

Two unemployment decisions from September 30 illustrate the importance of convincing hearing officers in order to prevail or contest unemployment claims.  In one case, the hearing officer found that the employer’s witnesses and video evidence were not credible and awarded unemployment compensation where it appeared that the true reason that the claimant had been fired was because of his union activity instead of violating safety rules. Gen. Die Casters, Inc. v. Ohio Dept. of Jobs & Family Servs., 2015-Ohio-4033.   In the other case, a trucker was awarded unemployment compensation even though he resigned without advance notice and gave a completely different reason for his resignation in the uncontested hearing than he had in his questionnaire. Friedel v. Quota, 2015-Ohio-4060.  The trucker initially claimed that he quit because his employer left him stranded in the cold for several hours, but at the hearing produced evidence that he quit because his employer ordered him to violate federal hours of service regulations in order to make a delivery and the employer had not appeared at the hearing to dispute the new explanation.  The appeals court noted that the trial court erred in finding that the claimant had waived his right to assert at the hearing a different reason for his resignation by not raising it in his initial application for benefits.  Also, the court was required to affirm the hearing officer if there was any credible evidence in the record to support his decision.

In the first case, the claimant – who had worked there since 1979 --  was terminated for violating the employer’s safety rules by removing stuck objects from a machine without first locking it out. (Initially, I was impressed that the employer was enforcing its safety rules without first waiting for an injury – a practice upon which OSHA frowns).  The employer had no less than three witnesses to the safety violation.  However, the hearing officer did not find them credible.  First, the hearing officer found one witness to be inconsistent regarding his physical location and the series of events when he supposedly witnessed the claimant violate the lock-out procedures.  Second, he also found the shift manager to lack credibility because he asked a trainee about the lock-out procedures instead of the claimant and could not explain why he decided to inform management of the violation instead of confronting the claimant and stopping him from working in an allegedly unsafe manner.  Third, he found it more likely that management was motivated by the claimant’s prior NLRB complaints, history of union organizing at the plant and the recent decertification of the union.  Fourth, the hearing officer refused to give weight to the employer’s video evidence because the picture quality was so poor that he could not definitely identify the claimant and had doubts whether it captured the claimant on the day and machine in question.  Fifth, the claimant credibly testified that he had properly locked-out the machine before clearing it.  Finally, the claimant’s testimony was supported by another employee who worked on the machine immediately after him.  Once the hearing officer rules on credibility, that determination may not be reversed on appeal if there is any evidence in the record to support it.  The claimant and his co-worker provided credible testimony to support the hearing officer’s determination, so the employer’s appeal was rejected despite having video evidence.

In the second case, the claimant’s initial application for benefits was denied and he appealed, explaining that his employer refused to assist him when his truck broke down and left him sitting in freezing night-time temperatures for hours until his son-in-law came to help him.  In response, the employer contended that the claimant was responsible for minor repairs and had been given a debit card with a $500 limit in order to do so.   Again, unemployment compensation was denied. On appeal, the claimant testified to a new reason for his resignation at the unemployment hearing (in which the employer did not participate).  He contended that he had been driving since 9 a.m. when his truck broke down at 10:30 a.m. and he didn’t return home until 7 a.m.  Federal Motor Carrier Safety Administration regulations required that he not drive again for 34 hours, or that he at least get a 10 hour break.  49 C.F.R. § 395.3.  When he was called about a noon pick-up in Detroit, he explained that he was unavailable.  His employer arrived at his home and an argument ensured, during which he resigned.  He also produced his driver logs to support his position. Without contrary evidence in the record, benefits were awarded.  The UCBR denied the employer’s request for review and so the employer appealed to the common pleas court, which reversed the decision.

The trial court did not address the claimant’s hours of service explanation for his resignation, relying instead on his initial and unjustified explanation for his resignation.  ODJFS successfully argued that the trial court had improperly substituted his judgment for that of the hearing officer, which was in a better position to evaluate the claimant’s credibility.  By ignoring the claimant’s testimony about the federal hours of service rules, the court had also implicitly determined that this argument had been waived when it was no included in the claimant’s initial application for unemployment benefits and his initial administrative appeal.  However, there is no provision for waiver in the unemployment statute: “The unemployment compensation statutes do not provide that arguments not made prior to an administrative hearing are waived and, in fact, the court must consider the record transmitted by the UCRC.”    Moreover, prior court decisions have found employees to have just cause to resign when they are directed to violate the FMCSA hours of service rules.  

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 be changed or 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.

Franklin County Appeals Court Finds Drivers to be Independent Contractors Under Unemployment Statute

Last week, the Franklin County Court of Appeals affirmed the trial court decision that a trucking company was not a statutory employer under Ohio’s unemployment statute with respect to the truckers who drove her long-haul trucks.  Evans v. Dir. Ohio Dept. Job & Family Servs., 2015-Ohio-3842.  While there were facts that supported arguments for and against employment under the 20 factors contained in Ohio Administrative Code §4141-3-05(B), the Court ultimately found that the trial court did not abuse its discretion in finding the truckers to be independent contractors.

According to the Court’s opinion, the trucking company leased its trucks to a freight broker, and also agreed to provide drivers.   However, the freight broker advertised, interviewed and hired the drivers, who then signed independent contractor agreements with the trucking company, were paid more than a third of her payment by the freight broker and were issued 1099 tax forms.  The drivers never met the trucking company owner and did not receive any training from the trucking company.  Although drivers could refuse routes and could choose their own route, they could not substitute another driver for themselves.  The drivers set their own hours and only got paid if the trucking company got paid.  They could work for multiple companies, but were not permitted to haul cargo for other companies in the trucking company’s trucks.

The Ohio Department of Job and Family Services directed the trucking company in 2008 to begin making contributions on behalf of the drivers.  On administrative appeal, the UCBR found that the trucking company’s right to control the drivers made her an employer even though she never exercised that right of control and, instead, delegated it to the freight broker.  On appeal, the common pleas court found the UCRB decision was unsupported by substantive, reliable and probative evidence.  He found the drivers to be independent contractors.  The Franklin County Court of Appeals concluded that there was no abuse of discretion in light of the ambiguity of some of the evidence.

Ohio employers must contribute to Ohio's unemployment compensation fund. R.C. 4141.23. The definition of "employer" includes individuals who "ha[ve] in employment at least one individual." R.C. 4141.01(A)(1)(a). "Employment" is:

[S]ervice performed by an individual for remuneration under any contract of hire, written or oral, express or implied * * *, unless it is shown to the satisfaction of the director that such individual has been and will continue to be free from direction or control over the performance of such service, both under a contract of service and in fact.

R.C. 4141.01(B)(1).  

 Consistent with the statutory definition of "employment," Ohio Adm.Code 4141-3-05(A) provides:

[A] worker is in employment when an "employer-employee" relationship exists between the worker and the person for whom the individual performs services and the director determines that:

(1) The person for whom services are performed has the right to direct or control the performance of such services; and

(2) Remuneration is received by the worker for services performed.

Ohio Adm.Code 4141-3-05(B) sets forth 20 factors "[a]s an aid to determining whether there is sufficient direction or control present" to establish employment.

 

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 be changed or 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.

Unemployment Compensation Awarded When Poor Performance Related to Substantially New Job Duties

 Earlier this month, a unanimous Ohio Court of Appeals reversed the denial of unemployment compensation to a terminated employee on the grounds that it was not just cause to fire the employee because of problems in performing newly assigned job duties.  New Carlisle v. Pratt, 2015-Ohio-1398.   Moreover, the trial court had failed to explain the basis of its decision denying the benefits and there was evidence in the record to support the Review Commission’s decision to award benefits.   Finally, the Court refused to consider arguments that the claimant had falsified records when that argument had not been raised until the evidentiary hearing.

According to the Court’s decision, the claimant had been assigned new environmental recordkeeping and inspection duties approximately two years after he had been hired.  Those duties were not performed or reassigned when he was off work. The Ohio EPA had already noted that the employer was understaffed when it assigned these duties to the claimant.  Following progressive discipline for other issues, he was ultimately terminated for failing to properly perform these newly assigned duties.   After his termination, these inspection and recordkeeping duties were divided among his replacement and other employee.  After an evidentiary hearing, the referee granted benefits, but a trial court reversed that decision on appeal.  This appeal followed.

An employee is not entitled to unemployment compensation if he was terminated for just cause in connection with his work.  An employer typically will have just cause to terminate an employee who does not properly perform his job duties if

(1) the employee does not perform the required work, (2) the employer made known its expectations of the employee at the time of hiring, (3) the expectations were reasonable, and (4) the requirements of the job did not change substantially since the date of the original hiring for that particular position.

 

In this case, the employee showed that his job had changed substantially since when he was hired and that it was the substantial change that led to his termination.   While the employer attempted to argue that he had always been responsible for these inspections and recordkeeping, there was no evidence that he had performed them until more than two years into his job and only after the OEPA brought up the issue.

 

The Court also rejected the newly asserted ground of dishonesty as showing just cause for termination because the referee found the claimant to be credible and the employer failed to raise this as an issue until the evidentiary hearing. “A just-cause determination cannot be based on a reason never stated by the employer as a justification for discharge.”  The failure to raise the argument earlier also constituted a waiver of that argument:

 

The City, therefore, has waived such an argument. “ ‘The rule compelling a party to present all legitimate issues before the administrative tribunal is required in order to preserve the integrity of the proceedings before that body and to endow them with a dignity beyond that of a mere shadow-play.’ ”

 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 be changed or 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.

Ohio Appeals Court Denies Unemployment Compensation to Employee Who Smoked Tobacco Off Duty in Violation of Employer Policy

On Friday, the Montgomery County Court of Appeals upheld the denial of unemployment compensation to a claimant who had been terminated for violating his employer’s anti-tobacco policy.  Reidell v. The Reynolds & Reynolds Co., Inc., 2015-Ohio-1048.  In that case, the employer had adopted a policy in 2007 prohibiting employees from using tobacco products anywhere at any time (including off duty or off premises) and requiring them to remain tobacco and nicotine free.  Employees were given the opportunity to attend smoking cessation classes, which the claimant attended in 2008 when he initially quit smoking.  After he tested positive for nicotine in June 2013,  he was placed on a last chance agreement and was subjected to monthly testing at his own expense.  However, he was terminated after he tested positive again in October 2013.   The unemployment office found he had been terminated for just cause because he had notice of the  lawful policy and was adopted for legitimate reasons (in keeping down healthcare costs and promote the health of its employees).  The Court ultimately found it irrelevant that the claimant was terminated and denied unemployment compensation for engaging in lawful, off-duty conduct (i.e., smoking a cigar at home).

Under Ohio Revised Code §4141.29(D), an employee is not eligible for unemployment compensation if he or she was terminated for just cause in connection with the individual’s work. ““Just cause for discharge may be established by proof that the employee violated a specific company rule or policy, * * * so long as the policy was fair and fairly applied.”  As previously discussed by the Ohio Supreme Court:

“The [A]ct was intended to provide financial assistance to an individual who had worked, was able and willing to work, but was temporarily without employment through no fault or agreement of his own.” * * *

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, he is no longer the victim of fortune’s whims, but is instead directly responsible for his own predicament. Fault on employee’s part separates him from the Act’s intent and the Act’s protection. Thus, fault is essential to the unique chemistry of a just cause termination.

Tzangas, Plakas & Mannos v. Ohio Bur. of Emp. Serv., 73 Ohio St.3d 694, 697-698, 653 N.E.2d 1207 (1995).

The Claimant’s primary argument was that even if the employer’s policy was lawful, he should not be denied unemployment compensation for violating it.   While the Court acknowledged that the policy was “arguably intrusive” in that it applied to off-duty conduct, a private company is free to enact its own lawful policies. 

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.

Ohio H.B. 37 Creates Consequences for Employers Which Ignore Unemployment Compensation Claims

A client shared with me this week that the Ohio Department of Job and Family Services sent a notice to employers about House Bill 37 which will become effective on October 21, 2013. Ohio law has long required employers to respond to requests for information concerning new applications for unemployment compensation.  However, it is not unusual for an employer to not contest a claim for unemployment compensation, at least during the initial application phase.  Sometimes, these same employers will then appeal a grant of unemployment compensation and raise good and valid reasons why unemployment compensation should be denied.  However, by that time, it can become difficult for ODJFS to recover the previously paid compensation after the initial determination is reversed.  Yet, for years, the employer has suffered no financial consequences for this turn of events even though it might have been able to prevent it by timely responding to the initial ODJFS request for information about the unemployed claimant.

The ODJFS letter says that H.B. 37 “encourage[s] employers to provide the separation information we need to accurately determine claimant eligibility.”  The notice continues to explain that employers “who repeatedly fail to respond promptly and adequately to requests for information regarding unemployment claims can be charged for any benefits that are ultimately found to be ineligible.  These charges can lead to an increase in your tax rate.”   For those of you who fear that you might miss the short deadline while you are on your annual vacation, be assured that no employer will suffer adverse consequences until failing to timely and adequately respond at least three prior times within the last twelve months.

Essentially, the new statute provides that an employer’s account will be not credited for amounts of previously paid benefits recovered by ODJFS if the following two conditions are met:

1)      The benefits were initially paid because the claimant’s employer (or any employee or agent of the employer) failed to respond timely or adequately to a request for information regarding the unemployment compensation claim;

·        A response is considered to be “timely” if received by ODJFS on time – which the ODJFS letter says is 10 working days from when the request was sent

·        A response is considered to be “adequate” if answers are provided to all of the questions raised by ODJFS on its form or the employer participates in a fact-finding interview if so requested.

2)      The claimant’s employer (or any employee or agent of the employer) previously established a pattern of failing to respond timely or adequately within the same calendar year.

·        A “pattern of failing” is established after the third instance of benefits being paid because the claimant’s employer (or employee or agent of that employer) failed to respond timely or adequately to a request for information regarding a determination of benefit rights or claims for benefits with a calendar year.  The ODJFS letter explains that a pattern will be found to exist if benefits are paid three times in error because of the failure of an employer to respond timely or adequately within a calendar year.  

 

Employers may appeal determinations that they failed to respond timely or adequately to requests for information.

In addition, the new statute also provides a 25% mandatory penalty when “any fraudulent misrepresentation has been made by an applicant for or a recipient of benefits with the object of obtaining benefits to which the applicant or recipient was not entitled.”

For legal junkies, H.B. 37 provides amends Ohio Revised Code §4141.24(D)(3)(d) in relevant part as follows:

(d)(i) An employer's account shall not be credited for amounts recovered by the director pursuant to division (D)(3)(c) of this section, and the mutualized account established in division (B) of section 4141.25 of the Revised Code shall not be charged pursuant to division (D)(3)(b) of this section, for benefits that have been paid to a claimant and are subsequently found not to be due to the claimant, if it is determined by the director, on or after October 21, 2013, that both of the following have occurred:

(I) The benefits were paid because the claimant's employer, or any employee, officer, or agent of that employer, failed to respond timely or adequately to a request for information regarding a determination of benefit rights or claims for benefits under section 4141.28 of the Revised Code.

(II) The claimant's employer, or any employee, officer, or agent of that employer, on behalf of the employer, previously established a pattern of failing to respond timely or adequately within the same calendar year period pursuant to division (D)(3)(d)(ii)(III) of this section.

(ii) For purposes of division (D)(3)(d) of this section:

(I) A response is considered "timely" if the response is received by the director within the time provided under section 4141.28 of the Revised Code.

(II) A response is considered "adequate" if the employer or employee, officer, or agent of that employer provided answers to all questions raised by the director pursuant to section 4141.28 of the Revised Code or participated in a fact-finding interview if requested by the director.

(III) A "pattern of failing" is established after the third instance of benefits being paid because the claimant's employer, or any employee, officer, or agent of that employer, on behalf of the employer, failed to respond timely or adequately to a request for information regarding a determination of benefit rights or claims for benefits under section 4141.28 of the Revised Code within a calendar year period.

(e) If the mutualized account established in division (B) of section 4141.25 of the Revised Code is not charged for benefits credited to a suspense account pursuant to division (D)(3)(d) of this section, a corresponding charge shall be made to the account of the employer whose failure to timely or adequately respond to a request for information caused the erroneous payment.

(f) The appeal provisions of sections 4141.281 and 4141.282 of the Revised Code shall apply to all determinations issued under division (D)(3)(d) of this section.

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.