Court of Appeals Issues Pro-Worker Decision Interpreting Anti-Worker Unemployment Law Amendment

Sara Geenen

On Thursday April 14, a Wisconsin Court of Appeals issued a  pro-worker decision, the first of its kind interpreting a pro-employer 2013 amendment to Wisconsin’s unemployment law that  has been used  by the Wisconsin Labor Industrial Review Commission (LIRC) to deny thousands of Wisconsinites the  protection that the unemployment system originally intended.

Under the amendment, employees terminated for “substantial fault” are ineligible for unemployment.  Prior to the amendment,  a terminated employee was  ineligible  for unemployment if the termination was for misconduct, such as theft, fighting on the job. While the amendment did not disqualify employees terminated for inadvertent errors or minor rules infractions without progressive discipline, the Labor Industrial Review Commission and its judges have used the “substantial fault” standard  inconsistently and  frequently to  the  advantage of employers. In the Operton v. LIRC decision, the Court of Appeals held that the employee, a cashier at Walgreens, could not be  denied unemployment compensation under the substantial fault standard where he was  described  as a conscientious employee and  made  a  handful of small  errors over the course of processing  80,000 transaction. The Court was critical of  LIRC and its interpretation  of the “substantial fault”  standard.

The decision is good news for workers since it establishes some limitations on “substantial  fault.” Because temporary disability workers  comp payments could also be denied to temporarily disabled employees suspended or  terminated for “substantial fault,”  the decision also stands to provide some additional income protection to employees under Wisconsin’s workers  compensation law.

It is  not yet known whether LIRC will appeal the Operton decision to the Wisconsin Supreme Court.