In this final installment, we look at three different real life situations involving employer responses to unemployment insurance (UI) benefit claims. Although not all are from Texas, the same underlying principles apply. The first situation helps us understand how to decide whether to challenge an UI claim. The next two situations show that your odds of successfully challenging an UI claim are tied to the manner in which employment was terminated.
Case #1: Suspicion May Be Grounds for Termination, But Not For Denying UI Benefits
Kathie Lindgren was a bank teller with fourteen years of experience. One day, her drawer was short a few thousand dollars. The bank’s investigation found no wrongdoing and none of the missing money was recovered. Still, the bank ended Lindgren’s employment, so she filed for UI benefits.
Lindgren lost the first round, but appealed the decision. On appeal, the hearing officer could not find any “misconduct associated with the work” in the record. Although the bank could end her at-will employment, there was no way to prevent Lindgren from collecting UI benefits. Perhaps the bank would have had a stronger case with better procedures in place. Alternatively, perhaps there was an error by the bank or dishonesty by some third party. That ambiguity was the source of the bank’s problem.
When employment is terminated, the Texas Workforce Commission (TWC) is going to want to know why. When you claim that the employee was engaged in “misconduct” or was suspected of “misconduct,” TWC is going to want to know how you came to that conclusion. Where the evidence is weak or missing, TWC is unlikely to simply agree that the employee was at fault. So, if you do not have a strong case for “misconduct associated with the work,” don’t spend time challenging that UI claim.
Case #2: Insubordination is Misconduct Associated With the Work
Betty Walter was responsible for cleaning certain types of medical devices at the hospital where she worked. According to her employer, she had a history of poor performance, a poor attitude, and behavior problems.
The turning point occurred when Walter threw a cupcake at a co-worker, which started a scene as the two got into an argument. When Walter’s supervisor tried to talk to her about the seriousness of her inappropriate conduct, Walter denied any wrongdoing. The hospital suspended her for two weeks. When she came back, they gave her an option: either resign or write her own personal improvement plan. If she chose to write the plan, it had to address developing a sense of accountability, improving her conduct, and improving her job performance.
She chose to write her own improvement plan, but the one she wrote was all about cupcakes. Because that was not the plan she was directed to write, her employment was terminated for insubordination. She wrote another plan, but the hospital would not consider it for the very good reason that she was no longer an employee. Subsequently, her UI claim was denied. She appealed, and lost her appeal as well.
Insubordination is a always strong cause of termination in the eyes of the TWC: once you sever the relationship, don’t let difficult former employees sneak back in. However, it’s important to understand how TWC uses the word “insubordination.” For UI claims purposes, insubordination means willfully failing to perform as instructed when it was within the employee’s capability to do so. Generally, having a bad attitude, working slower than expected, and making a smart remark to a supervisor are not insubordination. Writing about cupcakes when you are supposed to be writing about accountability, attitude, and work quality is insubordination.
Case #3: Life is Easier With A Voluntary Resignation, Even If It Is Not In Writing
Samuel Demmers worked as a stockyard cattle driver. He was instructed to work on the kill floor, but refused, saying that’s not what he was hired to do. Consequently, he went to meet with someone in the Human Resources Department. HR’s message to Demmers was to go home if he wasn’t going to work the kill floor. Demmers said he’d quit. Naturally, HR requested a letter of resignation. Demmers said he would produce one, but he never did.
The next day, Demmers called in as if he was still employed and asked HR what had been decided. HR communicated that nothing had been decided because he had already quit. Naturally, Demmers applied for UI benefits. He lost the first round, but appealed. On appeal, the hearing officer found that Demmers quit without good cause and was therefore not qualified for unemployment benefits.
A voluntary, written, signed resignation is best and will almost always disqualify someone from receiving UI benefits. Even so, a verbal resignation is also sufficient. The best practice with a verbal resignation is to write up an incident report detailing what happened, sign it, and place it in the employee’s file. If the resignation was witnessed, have at least one other company representative write and sign an incident report.
Conclusion
The two important questions to ask when assessing whether to challenge a UI claim are (1) is the cause of termination “misconduct associated with the work,” and (2) do you have the quality of evidence required to prove misconduct to a hearing officer. Employers are far more likely to prevail when the cause of termination is insubordination rather than poor performance, but a written voluntary resignation is the simplest and strongest case of all.