Lobbying Affiliate: MML&K Government Solutions

Plan Ahead - The Lesson of Fighting Unemployment Benefit Claims, FCBA Newsletter, May/June/July, 2012


Fayette County Bar Association, June/July 2012 Newsletter.

Authored by Luke A. Wingfield

Few things are more frustrating for an employer than terminating an employee for cause due to violation of company policy, be it for failing a drug test or some form of misconduct, and then that employee being awarded unemployment benefits. We here at McBrayer Law, find this result to be all too common, and then it is typically an uphill battle to overturn the award. In many instances, the problem lies not in the award itself, but in the lack of foresight and preparation that preceded the termination of the employee. If the first time the issue of unemployment benefits addressed is post-termination, then the key moment to address the issue has likely been lost.

Thankfully there are a number of straightforward steps that employers can take to try to ensure that an employee whose own actions have merited termination cannot then obtain unemployment benefits charged against his or her account. These steps address the fact that the commonwealth, in addressing a claim for unemployment benefits, is bound by law to award benefits to one who appears to be otherwise eligible unless the employer can show a sufficient basis exists to disqualify that person from receiving benefits. See KRS 341.370. The key then is to be able to prove that what disqualifies the former employee, and in a termination for cause, the following can prove essential.

1. Document, Document, Document

In reviewing a claim to unemployment benefits, the commonwealth wants to see specific documentation as to why the employee was terminated, and in our experience, it ideally wants to see documentation where the former employee was specifically warned and/or advised that the behavior in question would result in his or her being fired if it occurred at all or after an initial warning.

Thus, if the employer has a tiered discipline policy that starts with a verbal warning, care should be taken to document the verbal warning in writing in the employee's personal file. That writing can then be used as an exhibit when benefits are requested. It is all too common for a former employee to express complete ignorance as to anything verbally told to him or her by his or her employer, and then when there is no documentation to confirm the verbal warning or reprimand, for the commonwealth to find for the former employee on the issue.

Additionally, if an employee is terminated for a specific violation of company policy (i.e., one contained in an employee handbook), then that employee should be advised accordingly and record should be made as to the specific basis for the termination. If an employer can prove clearly that the employee had reason to believe that his or her behavior could result in termination, it typically goes a long way in helping defeat an award of benefits.

2. Make a note of witnesses to the behavior that resulted in the termination.

For instance, if an employee is terminated for threatening another employee, it is important that the person participating on behalf of the employer have available by phone any witnesses to that event. Generally the more people an employer can bring to the table to support a termination for cause, the greater the likelihood of successfully challenging an award of benefits. Again, documenting key facts, such as all individuals present when an inappropriate event occurs, is vital so that one can promptly identify those individuals who would be most helpful at any hearing.

3. In case of termination for violation of substance abuse policies, be sure that you have someone who can testify, if necessary, to how the blood and/or urine sample was handled and who can authenticate the test results.

The case of Haste v. Kentucky Unemployment Insurance Commission, 673 S.W.2d 740 (Ky. App. 1984) remains good law and continues to be cited in unemployment benefit determinations regarding terminations due to drugs and/or alcohol. In that case, the question was whether the employer laid the proper foundation to admit blood alcohol test results for an employee terminated due to intoxication. The Kentucky Court of Appeals ruled that it is not enough for an employer to simply introduce test results at an unemployment hearing. A proper foundation must be given for their admission and sufficient testimony given showing the chain of custody for the blood or urine tested. The Kentucky Unemployment Insurance Commission took this one step further and issued Precedent Decision 56722B wherein, in commenting on the Haste decision, it noted, "the custodian of the document [test results] or other qualified witness introducing the document containing the test results must be able to authenticate the document and testify to the chain of custody of the body fluid sample before that document may be considered an exemption to the hearsay rule." In order to trump a positive drug test, all a former employee has to do is deny the use of the drugs or alcohol. At that point authentication of the results must be provided.

Thus, it is important for every employer to be sure that the entity that does its drug testing has someone who can testify, when necessary, as to the chain of custody for each drug test and the authenticity of the test results. Otherwise a positive drug test is useless to deny unemployment benefits if your former employee challenges the test results.

In conclusion, when it comes to stopping an employee terminated for cause from obtaining unemployment benefits, the best time to do so is not after termination but before; plan ahead.

Luke A. Wingfield is an associate with McBrayer law. Mr. Wingfield concentrates his practice in employment law, insurance defense and litigation. He is located in the firm's Lexington office and can be reached at lwingfield@mcbrayerfirm.com or at 859-231-8780, ext. 1265.

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