Unemployment Benefits

Alebro v. Review Board of the Indiana Department of Workforce Development (Ind. Ct. App. April 18, 2012)

In this case, the Court of Appeals reversed the Review Board’s grant of unemployment benefits, holding that if an employee’s explanation for the behavior that led to termination is a different terminable offense, the employer has just cause to terminate the employee.

Alebro, a company that sells salt, fired an employee it caught selling salt on Alebro’s property. Alebro believed the salt belonged to Alebro and fired the employee for theft. At the unemployment benefits hearing, the employee argued he owned the salt. Selling one’s own salt on Alebro’s property was also a terminable offense.

The Court of Appeals held that the Review Board improperly failed to consider that the employee’s defense to termination was that he committed a different terminable offense than the employer identified as its grounds for discharge. The Court recognized that under its previous decision of Voss v. Review Board of Department of Employment and Training Services, 533 N.E.2d 1020 (Ind. Ct. App. 1989), the scope of review is limited to the stated offense. The Court explained that the Voss rule is meant to prevent surprise. This rationale does not apply where an employee affirmatively defends his conduct by admitting to a new terminable offense.

This case presents a good example of the Court of Appeals (and likely the attorney who represented the employer) looking at the rationale for precedent and modifying or limiting that precedent to deal with a new fact pattern. Appellate attorneys should not be afraid to acknowledge unfavorable precedent – in fact, our Rules of Professional Responsibility require us to inform the Court of unfavorable precedent – and then examine the underlying facts or rationale for the precedential rule and explain how or why it does not apply to the case at bar.

A final interesting point raised in this case is whether the Court of Appeals should have disclosed the name of the employer and employee in its published decision. Judge Crone concurred with the majority’s reasoning and result, but wrote a separate opinion arguing that Indiana Administrative Rule 9(G)(1) and Indiana Code section 22-4-19-6 required confidentiality. Judge Crone pointed out the Supreme Court has taken a somewhat inconsistent approach to this confidentially requirement, citing Recker v. Review Board, 2011 WL 6848389 (Ind. 2011) (identifying the parties where neither party made a specific request for confidentiality) and Chrysler Group, LLC v. Review Board, 960 N.E.2d 118 (Ind. 2012) (identifying the employee by initials but the employer by name based on the impractical nature of concealing the identity of Chrysler Group). Judge Crone presents a compelling argument based on the plain language of Administrative Rule 9. It will be interesting to see if the Supreme Court offers some clarity on this issue.