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Selected Issues In Pennsylvania Unemployment Compensation Law

Unemployment Compensation is a common feature in the landscape of our modern economy. However, both employers and employees sometimes overlook the delicate legal nuances that can arise when an employee leaves work and applies for benefits. The PA unemployment compensation lawyers at Wolf, Baldwin & Associates, P.C. can help unravel the mysteries. Before reviewing some specific issues, it is worthwhile to review the background of the Pennsylvania Unemployment Compensation (UC) Act.

In general, UC laws were enacted by states to protect unemployed persons who become unemployed through no fault of their own. The Pennsylvania legislature made the following declaration in 1936, which can now be found at the beginning of the UC Act at 43 P.S. § 752:

Economic insecurity due to unemployment is a serious menace to the health, morals, and welfare of the people of the Commonwealth. Involuntary unemployment and its resulting burden of indigency falls with crushing force upon the unemployed worker, and ultimately upon the Commonwealth and its political subdivisions in the form of poor relief assistance. Security against unemployment and the spread of indigency can best be provided by the systematic setting aside of financial reserves to be used as compensation for loss of wages by employes [sic] during periods when they become unemployed through no fault of their own.

With this premise, the PA legislature set up an administrative system to collect and distribute benefits to qualifying employees. Generally, an employee qualifies to receive benefits if he or she is able to work and available for suitable work, has registered with the unemployment office, and has complied with the office’s reporting requirements. 43 P.S. § 801.

However, in Section 802, the Act sets out a number of reasons for which an employee can be deemed ineligible for benefits. This review is performed on a week-by-week basis. Some of the reasons an employee can be deemed ineligible for benefits in a given week include any week where the employee: (1) fails to apply for suitable work or to accept suitable work; (2) is unemployed is due to voluntarily leaving work without cause of a necessitous and compelling nature; (3) is receiving or seeking UC benefits from another state; (4) is unemployed due to a stoppage of work which exists because of a labor dispute; or (5) is unemployed due to a discharge or temporary suspension from work for willful misconduct connected with the work.

A large body of unemployment case law has developed around the above exceptions, yielding guidance on what employers and employees can expect in given situations. The cases are too numerous to give even a sweeping overview. However, some specific cases are instructive, illustrating the difficulties the courts face in deciding these cases.

Health Problems

In cases where an employee becomes unable to perform his previous work because of health reasons, but could perform the work with minor changes in the job or work environment, the employer generally has a right to offer a reasonable accommodation: i.e., an offer of a job within the employee’s medical restrictions, if one is available. The employee must communicate the activities he is allowed to do to the employer, and he will be eligible for benefits if the employer has no work or fails to communicate the availability of work within the restrictions. Conversely, if the employee does not even attempt to perform the modified work offered, UC benefits will be denied. The Commonwealth Court in Cullen v. Unemployment Compensation Bd. of Review, 666 A.2d 772 (1995), stated:

Where an employee because of a physical condition, can no longer perform his regular duties, he must be available for suitable work, consistent with the medical condition, to remain eligible for benefits. However, once he has communicated his medical problem to the employer and explained his inability to perform the regularly assigned duties, an employee can do no more. The availability of an employment position, the duties expected to be performed by one serving in that capacity, and the desirability of that individual for service in that capacity are managerial judgments over which the employee has no control. As long as the employee is available where a reasonable accommodation is made by the employer, that is not inimicable to the health of the employee, the employee has demonstrated the good faith effort to maintain the employment relationship required under the Act…. To insist upon the employee’s initiating the quest for an alternative position, would require a meaningless ritual that does not further the objectives of the Act.

Thus, once an employee who is totally disabled is released back to work (and tells the employers of her availability for work), if the employer cannot then find work for her she may be eligible for UC benefits.

Off-Duty Misconduct

The Pennsylvania courts have had to resolve numerous cases involving UC claimants who were fired because of conduct that occurred outside of the work environment. In Jones v. Com., Unemployment Compensation Bd. of Review, 562 A.2d 935 (Pa.Cmwlth. 1989), a vice president of a corporation was fired after having an affair with the president’s wife. However, because there was no finding that the claimant’s conduct violated a specific work rule or was at odds with his employer’s business interest, as distinguished from his “Employer” personally, benefits could not be denied.

However, other cases involving arguably similar misconduct have led to findings that the misconduct was indeed work-related, and thus benefits were properly denied. In Hackney v. Unemployment Compensation Board of Review, 432 A.2d 317 (Pa.Cmwlth. 1981), while the claimant contended she was discharged for rebuffing the employer’s sexual advances, the Board found that she was discharged for work-related conduct. In Argentina v. Unemployment Compensation Board of Review, 371 A.2d 561 (Pa.Cmwlth. 1977), the claimant was discharged for threatening to send letters complaining of unwanted sexual advances to the employer’s business associates. This too resulted in a finding of work-related misconduct, and benefits were denied.

In cases where an employee’s misconduct is after business hours and outside of the workplace, the test is whether the misconduct is inconsistent with acceptable standards of behavior and directly affects the claimant’s ability to perform his assigned duties. Southeastern Pennsylvania Transportation Authority v. Unemployment Compensation Board of Review, 506 A.2d 974 (Pa.Cmwlth. 1986). While the Pennsylvania doctrine of “employment at will” permits an employer to fire an employee for misconduct that occurs outside the workplace, that does not preclude the State from granting UC benefits. Difficult UC cases often arise when an employee is convicted of a crime that occurs outside of work. In determining whether the employer has carried its burden in showing that the claimant is ineligible for benefits, the UC Board and court must weigh: (1) the nature of the claimant’s assigned duties; (2) the specific nature of the offense committed by the claimant; (3) whether the claimant’s job required any special degree of trust on the part of the employer, considering whether the claimant works with items of value and whether he is normally under the direct supervision of the employer; and (4) any other circumstances which may particularly affect the claimant’s ability to do his job, including whether the crime occurred on or off the employer’s premises, and whether or not it involved any of the employer’s other workers or clients. Robinson v. Com., Unemployment Compensation Bd. of Review, 546 A.2d 750 (Pa.Cmwlth. 1988). As you can well imagine, a DUI conviction for a school bus driver is less acceptable than the same conviction might be for a dishwasher.

Lawyers for both employers and employees, and the courts themselves, wrestle with many different fact situations and many types of UC cases. Winning or losing a case can often turn on effective representation before the Unemployment Compensation referee. Putting the correct evidence on the record is essential to winning. Employers and employees are wise to seek legal counsel to maximize their chances of winning these cases.

The unemployment comp lawyers of Wolf, Baldwin & Associates, P.C. represent both employers and employees in PA Unemployment Compensation cases, from the initial hearing before the referee through all levels of appeals. Please click here to contact us today.

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