Employers bear the burden of proof in unemployment court cases

“How can a fired employee be awarded unemployment benefits that he did not deserve to get?” This is perhaps one of the most asked questions I hear from employers after they receive an unfavorable hearing decision.

Three of the top reasons employers lose unemployment compensation discharge cases are:

1. Discharge was for incompetence, but not misconduct.
2. The final incident of a series was not misconduct
3. No documents and/or first-hand witnesses were present at the hearing.

The employer often believes they had a valid business reason to fire the person and, therefore, the claimant did not deserve the benefits. Although employers have a valid business need to terminate in most of the cases involving discharge, they sometimes fail to understand what the administrative law judge is listening for in the hearing. In every case, the judge considers whether the party with the burden of proof met that burden with credible testimony. In a discharge case, that means showing “misconduct” and “connection with work”. In the case of a discharge, the burden of proof is always on the employer.

So what is the definition of misconduct? An explanation is offered in a decision by Michigan Employment Security Act, which explains that misconduct is not defined by the statute, but defined in several court cases, including Carter v Michigan Employment Security Commission, 364 Mich 538 (1961), where the state Supreme Court used a definition from Boyton Cab Company v Newubeck, 296 NW 636, 640 (Wis 1941).

The Boyton case defines misconduct as a “wanton disregard of an employer’s interest” and when an employee has a “deliberate violation or disregard of standards” that an employer has a right to expect. It can also be a high degree of carelessness or negligence by the employee or when he/she shows “an intentional and substantial disregard” of the employer’s interests and the obligations the employee has. The case also notes that inefficiency on the job, simply unsatisfactory conduct or the inability to do a job or good-faith errors made on the job are not misconduct.

Examples of cases that failed to show misconduct:

Case 1: At the hearing, the employer’s witness testifies claimant was discharged for “poor performance.” Previous discussions about multiple, past poor work quality was presented but no documentation or write-up were provided. Final event was a failure to complete a job that did not meet the employer’s standards. Claimant stated that he exerted his best efforts at work and followed the instructions given to him.

The decision: The employer may have had a good business reason for discharging the claimant. However, the claimant’s denials of wrongdoing were, at least, as believable as the employer’s evidence against him. Burden of proof to establish discharge for work-connected misconduct was not met by the employer. No disqualification. Redetermination affirmed.

Case 2: At the hearing the employer testified that the claimant was discharged for violation of the company attendance policy. The claimant had been given several disciplinary writeups which the claimant acknowledged receiving. The claimant was given a final writeup stating that the next attendance infraction would result in termination. The claimant called in sick no less than one week later due to hurting his foot over the weekend and was subsequently discharged. The claimant testified that had he been able to come to work he would have and was also able to provide a doctor’s note for his injury.

The decision: The administrative law judge concluded that although the claimant had been given proper warnings prior to the final incident, the employer had not carried its burden of showing misconduct. The judge found that, based upon the testimony, the last incident showed no wrongdoing by the claimant and was, in fact, a situation that was out of his control. No disqualification. Redetermination affirmed.

Understanding what the judge is listening for is critical for preparing for unemployment hearings. If you have any questions about the unemployment hearing process, contact the experts at BCN Services to assist.
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Lisandra Garrow, HR Generalist