This post was contributed by Joseph S. Sileo, an Attorney in McNees Wallace & Nurick’s Labor & Employment Practice Group in Scranton, Pennsylvania.

After nearly 21 years of employment, a full-time clerk with Turkey Hill lost her job for engaging in several instances of bad behavior within a short period of time. The employee initially received a verbal counseling from her supervisor after telling two Spanish-speaking co-workers to stop speaking Spanish at work because it was a "pet peeve" of hers that employees should speak English when working in the United States. Then, only a few months later, the employer received a complaint that that employee was involved in an argument with a driver over the telephone during which she displayed her "middle finger" to the phone as the call ended, an unseemly gesture that was witnessed by an outside store vendor. Following this incident, the employee was advised that her behavior must improve and she was issued a written warning; when her supervisor attempted to give her copies of the Company polices that she had violated, the employee attempted to throw the policies in the garbage. Having had enough, the employer terminated the employee.

The employee filed a claim for unemployment compensation (UC) benefits and Turkey Hill challenged the employee’s UC application. Turkey Hill pointed to its disciplinary policy prohibiting loud, argumentative, disruptive or otherwise unprofessional conduct toward or in the presence of others, including associates, vendors, visitors and the public, as well as its "Enduring Principles" policy which, among other things, required employees to treat others with fairness and respect and practice honesty and integrity in all relationships. Turkey Hill argued that the employee’s conduct violated both policies and that her termination for such willful misconduct rendered her ineligible for UC benefits.

Not surprisingly, the employee’s testimony differed significantly as compared to the employer’s witnesses. As a result, the outcome of the case turned primarily on witness credibility. The employee testified that she "politely" asked her two co-workers not to speak Spanish when she was standing between them as it was rude for them to do so, she did not make a crude "middle finger" gesture during the phone call, and she never refused to read or attempted to throw away any policies presented to her by her supervisor.

Both the Referee following the hearing, and then the UC Board of Review on appeal, credited the testimony of the employer’s witnesses over the employee’s testimony, and determined that the employee’s separation from employment was due to willful misconduct thus rendering her ineligible for UC benefits. The employee appealed.

On further appeal to the Commonwealth Court, the Court acknowledged that the Board of Review is the ultimate fact finder empowered to determine witness credibility and resolve conflicts in evidence/testimony. The Court further concluded that there was no reason to disturb the Board’s credibility determination and factual findings in favor of the employer, and that the credible testimony by the employer’s witnesses provided substantial evidence supporting the Board’s finding of willful misconduct and denial of UC benefits.

Interestingly, the employee argued on appeal that the underlying administrative decisions were flawed because the Referee denied the employee’s request to sequester (separate) the employer’s witnesses at the hearing. More specifically, the employee argued that the testimony of the employer’s second witness was tainted and could not be considered reliable because that witness was permitted to hear and potentially influenced by the testimony of the employer’s first witness. The Court rejected the employee’s argument, noting that there was no resulting prejudice because the testimony of the employer’s first witness was sufficient in and of itself, and the UC Board of Review relied upon it, to support the administrative factual findings and the Board’s ineligibility determination.

This case demonstrates not only that clear and effective employment policies can be crucial to supporting employment decisions, but also that preparing in advance for responding to claims and participating in administrative proceedings will afford employers the best opportunity to successfully challenge non-qualifying UC claims. Turkey Hill was successful in this case because it presented relevant witness testimony and policies at the hearing. Employers can control overall unemployment compensation costs, send the right message, and maintain the integrity of its workplace policies and standards of conduct by challenging UC claims when warranted and by sufficiently preparing in advance when responding to claims and participating in UC proceedings. To assist you in this regard, watch for our soon-to-be-issued blog post with recommendations for responding to UC claims and preparing for UC proceedings—and when to involve legal counsel.