The opinion of the court was delivered by: Judge Pellegrini
AND NOW, this 22nd day of October, 2010, the opinion filed July 29, 2010, in the above-captioned matter shall be designated Opinion rather than Memorandum Opinion, and it shall be reported.
BEFORE: HONORABLE DAN PELLEGRINI, Judge, HONORABLE PATRICIA A. McCULLOUGH, Judge, HONORABLE JOHNNY J. BUTLER, Judge.
In each of these 12 cases that have been consolidated for appeal, Juniata County Childcare & Development Services, Inc. (Employer) appeals the Unemployment Compensation Board of Review (Board) order finding its 12 former employees (collectively, Claimants) are eligible for unemployment compensation benefits because Employer had not proven that Claimants were employees of an educational institution with reasonable assurances that they would be employed after the regular summer break. It also appeals from the Referee's refusal to grant Employer's request for a subpoena and request for a remand hearing to present additional evidence.
Claimants all worked for Employer in some capacity related to Employer's Head Start Program.*fn1 The Claimants are: Bonnie McGowan, a teacher's aide; Rhonda Bierma, a teacher's aide; Donna French, a cook; Shirley Messimer, a rider;*fn2 Ginger Scholl, a teacher; Cheryl Dodson, a CACFP/nutrition coordinator; Alice Beasom, a rider; Amy Feltman, a health/mental health nutrition manager; Fina Williams, a bus driver; Susan Rowles, a bus driver; Heidi Black, a teacher's aide; and John Zendt, a bus driver. All Claimants, except for Rowles and Dodson, worked 36 weeks per year. Rowles and Dodson worked 52 weeks, but at reduced hours during the summer.
Employer operated the federal Head Start Program in Juniata County as a federal grantee until January 27, 2005, when the program was transferred to Community Development Institute (CDI), an organization that took over Head Start Programs from federal grantees that lost their grant. CDI ran the Head Start Program for one year on an interim basis before a third party became the next federal grantee. As a result of the grant transfer, all employees involved in the Head Start Program, including the 12 listed above, had their employment with Employer terminated on January 27, 2005, and then began working for CDI the next day. All aspects of their employment remained identical after the grant transfer to CDI.
When the school year ended, Claimants each filed for unemployment compensation benefits with the Department of Labor and Industry (Department), and their requests were granted. The Department determined that Section 402.1 of the Unemployment Compensation Law,*fn3 which makes ineligible for benefits employees of an educational institution unemployed during the summer months with reasonable assurances of continued employment with the educational institution during the next school year, did not apply to Claimants. The Department based this determination on the United States Department of Labor's Unemployment Insurance Program Letter (UIPL) No. 41-97.*fn4 All Claimants except for Williams, who left CDI's employment in the spring of 2005 to work for a private employer, continued their employment with CDI in the fall at the beginning of the next school year. Employer filed timely appeals to these determinations, and a hearing was held before a Referee.
Before the hearings began, Employer requested that the Referee issue a subpoena for certain documents from CDI.*fn5 According to Employer, these would establish that Claimants had a reasonable assurance of continuing their employment with CDI once the summer ended and school was back in session. Employer stated that CDI was willing to provide the information but that a subpoena was needed in order to comply with federal regulations. The Referee denied the subpoena request stating that it was unenforceable because CDI had a Nebraska address and that even if the documents were provided, Employer would likely not have a witness that could lay a foundation for them. Employer responded that because CDI was willing to cooperate, there was no enforceability issue, and that several of the Claimants themselves had already testified at an earlier hearing, the transcript of which was admitted as an exhibit in this hearing that Claimants had received these documents so there was no foundation issue either. (Reproduced Record at 184-187).*fn6
As to the substance of its appeal, James Hartzell, Employer's Board President, testified to the nature of the Head Start Program and the relationship between Head Start, Employer and CDI. According to Hartzell's unrebutted testimony, Head Start is an educational program that gives at-risk children between the ages of three and five an early education that they might not receive otherwise, including basic writing skills, learning colors and the like, similar to a pre-kindergarten class. Employer received a federal grant that ran from February to January of each year to administer the program, which ran exactly according to the Juniata County School District's schedule. The program continued exactly the same once CDI took over on January 28, 2005. (Reproduced Record at 206-208, 214).
Shannon Foose, Employer's fiscal manager and daycare director, testified that each Head Start employee would receive a one-year contract in February which covered nine months (excluding summers) for the majority of the employees. Once the school year ended, the employees would not receive any notice regarding returning for the following year until August, when a letter would be sent to them concerning orientation for the next school year. (Reproduced Record at 297-298). The notification procedure did not change when CDI took over the program. Susan Yorks, an administrator/secretary/receptionist with the Head Start Program who also received unemployment compensation benefits and was a claimant at that time, testified that CDI did not provide its Head Start employees with a letter in the spring that they would return in the fall. Instead, CDI contacted the employees in August to notify them that they would be returning. (Reproduced Record at 312-313). There was no testimony regarding whether CDI had similar one-year contracts with the Head Start employees, which could have been obtained by a subpoena to CDI for this information.
Cynthia Dau, an employment specialist for the Department, testified that Claimants Williams' and Beasom's status differed from those of the other Claimants. Claimant Williams, a bus driver, left CDI at the end of February 2005 to work for a private, for-profit employer that employed school bus drivers. He lost his job with that employer on June 3, 2005, due to lack of work and subsequently filed for unemployment compensation benefits like the other Claimants. Claimant Beasom, a rider, differed from the other employees because she, alone out of all the Claimants, received a reasonable assurance that she would return to work after her summer break due to a payroll change notification from CDI that indicated that she would return to work on September 6, 2005. Employer's counsel renewed her request for a subpoena of CDI to determine if CDI had payroll change notifications for the other 11 Claimants, but the Referee again denied her request. (Reproduced Record at 229-244). Ms. Dau also confirmed that the Department's determination was based on the federal guidelines outlined in UIPL 41-97.
The Referee issued separate but substantially similar determinations for each of the 12 Claimants. In his determinations, he found that Employer operated a Head Start Program that was then transferred to CDI; that the Claimants worked for Employer, then CDI without a break until summer; and that Claimants (except Williams) returned to work with CDI the following year. The Referee made no findings of fact based on the substantial testimony detailed above concerning the nature of the Head Start Program, the nature of the work performed by the Claimants for Head Start, the relationship between Head Start and the Juniata County School District, the normal summer procedure for Head Start employees, and whether that procedure was followed by CDI. He made no findings of fact based upon any testimony of Employer's witnesses and no findings ...