Laid-off worker due benefits, appeals court finds in reversal

The Arkansas Court of Appeals on Wednesday overturned a state agency decision denying unemployment benefits to a man who mentioned a subordinate’s firing in his benefits application.

The court unanimously found that Ray Roberts III of England was fired as part of a layoff at his company, North Little Rock-based Hall Manufacturing Inc., and not for misconduct, which usually results in a denial of benefits. Roberts had been an employee of the company for 25 years.

Judge Waymond Brown wrote that the Department of Workforce Services and the Board of Review erred in denying benefits based on statements Roberts included in his application about his failure to properly supervise his subordinate.

Hall Manufacturing never alleged that Roberts had been let go because of misconduct.

The appeals court said it would uphold the ruling against Roberts if “the board could reasonably reach its decision [based] on the evidence before it.”

“Here the weight of evidence in the record demonstrates Roberts was discharged due to the elimination of his position. Accordingly, the decision of the Board is reversed, and the case remanded for an award of unemployment compensation,” Brown wrote.

Roberts was an assistant supervisor for the company in April, when he received notice that one of his employees had been fired for falsifying mileage records, according to the court’s opinion.

When Roberts learned that he was also losing his job, he “initially surmised that it had to do with the subordinate’s misconduct,” but was later told it was because his position was being eliminated, the opinion states.

The man’s supervisor also told him he would be entitled to a severance package.

Roberts applied for unemployment benefits and included details about the subordinate employee’s firing. He also stated that he had been fired for not adequately supervising the employee.

The department denied Roberts benefits after noting that Roberts was told his position was being eliminated and that he was offered a severance package, citing his written statements as “misconduct” under Arkansas Code Annotated 11-10-514.

Roberts appealed the decision and testified during a telephone hearing that he was fired because of a layoff. His employer did not respond to requests for information from the department for the hearing.

The Appeal Tribunal, which handles the department’s appeals, and the Board of Review upheld the decision and found that Roberts’ written statements in his application were “more credible” than his testimony during the appeal hearing.

Brown wrote that the only evidence regarding “misconduct” was in Roberts’ application, but that it didn’t suggest “intentional conduct, a pattern or practice of disregard, or even indifference to the standard of conduct the employer had a right to expect.”

“Mere good-faith errors in judgment or discretion and unsatisfactory conduct are not misconduct unless they are of such a degree or recurrence as to manifest culpability, wrongful intent, evil design, or intentional disregard of an employer’s interest,” Brown noted, quoting a prior ruling.

The fact that Roberts was offered a severance package “reinforces that the termination decision was caused by downsizing” and the conclusion that he was fired for misconduct could not be sustained, Brown wrote.