The Minnesota Unemployment Insurance Program governs unemployment benefits. The Program provides “workers who are unemployed through no fault of their own a temporary partial wage replacement to assist the unemployed worker to become reemployed.” To be eligible for benefits, an applicant must comply with several requirements. However, if the applicant was discharged from employment due to misconduct, he/she will be denied benefits. It is important for employers to have an understanding of these legal concepts because their tax liability may increase if discharged employees are awarded unemployment benefits.This article addresses what misconduct makes a former employee ineligible for unemployment benefits.
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Misconduct Barring Unemployment Benefits
In Minnesota, “[a]n applicant who was discharged from employment by an employer is ineligible for all unemployment benefits . . . only if: (1) the applicant was discharged because of employment misconduct . . . or (2) the applicant was discharged because of aggravated employment misconduct[.]”
“Employment Misconduct”
The first type of misconduct is defined as “any intentional, negligent, or indifferent conduct, on the job or off the job that displays clearly: (1) a serious violation of the standard of behavior the employer has the right to reasonably expect of the employee; or (2) a substantial lack of concern for the employment. The analysis is fact-intensive and varies depending on the employer’s interests and employee’s conduct.
Employer’s Interests
The first step is to determine whether employer’s interest/policy was reasonable. “An employee’s refusal to abide by the employer’s reasonable policies ordinarily constitutes employment misconduct.” When an employer’s request is unreasonable under the circumstances, however, an employee’s refusal to comply does not constitute misconduct.
Employee’s Conduct
If the employer’s interest is reasonable, the analysis focuses on the employee’s (not the employer’s) conduct. An employee’s expectation that the employer will follow its disciplinary procedures has no bearing on whether the employee’s conduct rises to the level of misconduct.
In many cases, the key issue is whether employee’s conduct was “intentional, negligent, or indifferent.” Courts will not deny benefits to discharged employees who are merely inefficient and/or perform unsatisfactorily. For example in Bray v. Dogs & Cats Ltd, an employee did not meet expectations, turned in paperwork late, disobeyed an order to issue a warning to another employee, and was terminated. Nevertheless, the Court awarded unemployment benefits holding that the employee’s conduct amounted to simple inefficiency and unsatisfactory performance. Conversely, the Minnesota Unemployment Insurance website lists examples likely amounting to misconduct: continued, unexcused absences/tardiness; using drugs or alcohol on the job; breaking company rules; intentional neglect of duties; or insubordination, theft, fighting, or harassment. These examples illustrate the stark contrast from mere ineffectiveness as exemplified in Bray.
Finally, if the conduct for which an employee was discharged involved a single incident, “this is an important fact that must be considered in deciding whether the conduct rises to the level of . . . misconduct.” Formerly, a single incident likely would have been insufficient to rise to the level of misconduct. However, courts may now determine that one incident was egregious enough to be classified as misconduct under the facts.
“Aggravated Employment Misconduct”
The second type of misconduct is defined as “the commission of any act, on the job or off the job, that would amount to a gross misdemeanor or felony if the act substantially interfered with the employment or had a significant adverse effect on the employment.” A common issue is determining whether the conduct had an “adverse effect on employment.”
Consequences of Finding Misconduct
Under both types of misconduct, the applicant is ineligible to receive unemployment benefits. However, under “Aggravated Employment Misconduct,” the employee is also denied wage credits.
Practical Example
Two employees work as night janitors. Their job is to sweep the floors while unsupervised. After receiving complaints from other workers, employer discovers the employees sleeping at 2:30 a.m. during their shift. They are lying on mats. Each has a pillow. One has a blanket. Their alarm clock is set for 4:35 a.m., which far exceeds their permitted break time. In this case, the employer has a reasonable interest in maintaining a disciplined work environment. The employees intentionally violated the employer’s interest and break policy.