As unemployment rises, more individuals, including Minnesotans are seeking unemployment compensation benefits. Nationally, the unemployment rate has leveled off a bit from the Covid-19 scourge heights, now about 9.4% across the nation, while slightly lower, about 6.4% in Minnesota. These figures are more than twice as high as the near record lows that were reached about a year ago, before the pandemic arrived on these shores.
In addition to the high unemployment rate, Minnesota suffered a loss of about 50,000 jobs in the last month of 2020, with about 40,000 of them being in the hard hit hospitality restaurant businesses due to the full and partial shutdowns mandated by Governor Walz to address the pandemic.
Unemployment Undertakings
The rise of unemployment has led to more unemployment compensation claims being filed in Minnesota and elsewhere. The process in Minnesota consists of applying online with the Department of Employment & Economic Development (DEED), filling out a questionnaire, which is then given to the employer, who has 20 days to respond. Occasionally, but not too often, DEED will ask the employee to respond to the employer’s position. After all of this is done online, the DEED makes a preliminary decision as to the employee’s eligibility. Employees who are laid off, furloughed, or otherwise let go for reasons beyond their control, almost always obtain unemployment benefits unless, of course, they are seeking other “suitable” employment. The benefits last for up to six months, provided that the employees continue their job search and report any other income, which is a set off from the benefits to which they are entitled.
The two major reasons for an employee to be denied benefits are voluntarily resigning or quitting their job without “good reason caused by the employer,” or for “misconduct,” which consists of serious misbehavior that is beneath the standards reasonably expected by the employer.
Depending upon the outcome of the initial review, which oftentimes is adverse for the employee, either party may appeal the decision to seek a hearing before an unemployment law judge (ULJ). An appeal must be filed within 20 days, and the courts consider this very strict and require timely compliance with the 20 day requirement.
Many employees who are denied benefits at the first level will undertake this appeal, while employers who lose in the initial determination generally will refrain from appealing, although they have the right to do so. If an appeal is taken, an unemployment law judge will convene a hearing, which usually lasts for about an hour but, in a more complicated situation, can last quite a bit longer, and then make a decision as to the employee’s eligibility for benefits. The hearings are conducted by telephone, which has been in place for nearly two decades, even before the pandemic and ZOOM technology. The parties will explain their position and may call witnesses and present documents to support their arguments.
Either party may seek reconsideration of that decision, which rarely succeeds. After that, the next step in the process is for an appeal to the Minnesota Court of Appeals, which reviews the decision of the unemployment law judge.
When unemployment was high, the appellate court was hearing up to 200 unemployment cases a year, but as the unemployment rates fell, so did the number of cases heard by the court, which almost always affirms or upholds the decision of the ULJ. It is rare instances of appellate reversal. Theoretically, an appeal can be taken from the decision of the appellate court to the Minnesota Supreme Court, but that tribunal only exercises discretion in unemployment cases every few years, involving significant and highly disputed issues.
Rare Reversals
As indicated, the appellate court rarely reverses a decision of a ULJ, especially when unemployment benefits are denied. The courts generally rule that the ULJ has had discretion in hearing the case and making a decision, unless there is some egregious factual or legal error.
This tendency has been reflected in a number of cases decided recently by the Minnesota Court of Appeals. Although it did allow students who work part time and were laid off because of the pandemic to be entitled to unemployment compensation benefits late last year, which was one of the few bright lights for employees’ recent appellate challenges.
In five other cases decided late last year, the appellate court upheld determinations of ineligibility and denying benefits, eithers on grounds of “misconduct” due to absences from work and the like or because of employees voluntarily quitting their jobs, without “good cause” attributable to the employer.
That lack of success is consistent with the pattern established by the Minnesota Court of Appeals, which generally upholds the denials in more than 90% of unemployment compensation appeals. Thus, as a practical matter, the decision of an ULJ at a hearing is generally binding on the parties, subject to limited rights of appellate review.
Accordingly, claimants should be well prepared when attending unemployment compensation hearings, gathering document and other evidence and calling upon supportive witnesses, which may be subject to subpoena, if necessary.
Claimants seeking unemployment compensation applicants can pursue these claims on their own, representing themselves pro se, but it usually is helpful to have an attorney participate, at least in getting some guidance during the process and, if warranted, representing the claimant/employee at the hearing before a ULJ. While having legal representation is not assured success, it greatly increases the likelihood that the outcome will be favorable.
The same is true for employers, who also can benefit from having legal counsel assist them in defending this unemployment compensation claims or participating in evidentiary hearing before the ULJ. In either case, although there is no assurance of success, the odds of prevailing increase for the parties if represented by counsel in these proceedings.
Contact an attorney today.
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Marshall H. Tanick is a Twin Cities attorney with the Twin Cities law firm of Meyer Njus Tanick, and represents employers and employees in a variety of workplace related matters, including unemployment compensation proceedings.