Many employers are increasingly frustrated with the decisions granting unemployment insurance (UI) benefits to terminated employees. Since a termination does not automatically preclude an employee from collecting benefits, it is important to understand the EDD’s rules.
This recent case is another example of how liberal the EDD’s determinations are which provide benefits to an employee fired for misconduct. (Robles v. Employment Development Department, 207 Cal.App.4th 1029 (2012).
Use of Shoe Allowance for a Friend in Need:
In this case, the employer provides its employees with an annual allowance to purchase safety shoes. The employee went to purchase shoes using the allowance but told the clerk he was going to give the shoes to his friend who needed them. The clerk told him that she could not allow him to make the purchase for a friend.
Upon being notified of this event, the Company terminated the employee for improper use of company funds. The employee filed a claim for Unemployment Insurance (UI) benefits and his claim was denied but the appellate court reversed and found that the employee was entitled to benefits as his conduct did not rise to the level of “misconduct”.
The UI Code provides that an individual cannot receive unemployment compensation benefits if the EDD determines that the employee was discharged for “misconduct.”
Misconduct is defined as: Willful or wanton behavior, which includes conduct that shows wrongful intent or an “intentional and substantial disregard of the employer’s interests.”
“Misconduct” for UI eligibility purposes does not include good faith errors in judgment, mere inefficiency or failure in good performance that results from inability or isolated negligence.
No Intent to Injure Company’s Interests:
Here the court found that there was no evidence of willful or intentional disobedience by the employee in his good faith humanitarian effort to provide his friend with shoes. The Court held that since the employee already had two pairs of decent safety shoes and would not be going without or jeopardizing his safety at work, and expressed regret when confronted and assured his supervisor it would not happen again and did not actually use the shoe allowance for his friend, that the employee should be entitled to benefits.
Employer’s Burden:
In EDD hearings, it is the employer burden to submit evidence that misconduct occurred. In this case, the employer did not file an opposition to the benefits claim, did not speak with EDD investigators and did not submit any evidence of the employee’s misconduct. Instead, the employer appealed the decision once it was made.
What Should I Do?
- Review the EDD’s website which provides guidance on the types of “misconduct” that might result in disqualification.
- Follow time limits and procedures to challenge a UI Claim
- If you receive a “Notice of Unemployment Insurance Claim Filed” from the EDD, you should respond within 10 days of the mail date at the top of the notice.
- Failure to timely respond waives your right to appeal any determination as to eligibility.