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Fugh v. Unemployment Compensation Board of Review

Commonwealth Court of Pennsylvania

January 18, 2017

Jessica P. Fugh, Petitioner
v.
Unemployment Compensation Board of Review, Respondent

          Argued: November 16, 2016

          BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge HONORABLE RENÉE COHN JUBELIRER, Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE P. KEVIN BROBSON, Judge HONORABLE PATRICIA A. McCULLOUGH, Judge HONORABLE MICHAEL H. WOJCIK, Judge HONORABLE JOSEPH M. COSGROVE, Judge

          OPINION

          MARY HANNAH LEAVITT, President Judge.

         Jessica Fugh (Claimant) petitions for review of an adjudication of the Unemployment Compensation Board of Review (Board) that affirmed a Referee's decision that Claimant was ineligible for the unemployment compensation she had collected in the amount of $738 and, thus, liable for its repayment.[1] The Board found, as fact, that Claimant made an honest mistake in filling out her online application for unemployment compensation, but it nevertheless held Claimant liable for a "fault" overpayment of benefits pursuant to Section 804(a) of the Unemployment Compensation Law (Law).[2] On appeal, Claimant challenges the Board's holding that she is liable for a fault overpayment. She contends that her restitution obligation is governed by Section 804(b) of the Law, 43 P.S. §874(b), which addresses non-fault overpayments. We agree and reverse the Board.

         Claimant worked full-time at Community Chevrolet, Inc. (Employer) as a customer care associate from October 22, 2013, to July 13, 2015. In July 2015, Employer reduced her hours to 25 hours per week and relieved her of some of her job responsibilities. Claimant resigned and thereafter submitted an online application for unemployment compensation. On her application, Claimant identified the reason for her separation from Employer as "lack of work, " which was one of the choices provided on the application form. The Scranton UC Service Center granted Claimant benefits for the weeks ending July 25, 2015, August 1, 2015, and August 8, 2015, for a total of $738.

         Based on information subsequently provided by Employer, the Service Center concluded that Claimant was ineligible for the benefits she had received. The Service Center then issued three Notices of Determination. The first notice advised Claimant that she was ineligible for benefits under Section 402(b) of the Law, 43 P.S. §802(b), [3] because she lacked a necessitous and compelling reason for leaving her job. The second notice advised Claimant that because she was at fault for the overpayment, she had to repay the entire amount of compensation she received plus interest in accordance with Section 804(a) of the Law, 43 P.S. §874(a). The third notice imposed a five-week penalty upon Claimant under Section 801 of the Law, 43 P.S. §871, for the stated reason that Claimant had knowingly made a false statement or failed to disclose information in her application for unemployment.

         Claimant appealed, and a hearing was held before a Referee. Claimant testified that in the course of her employment, she had undergone a high risk pregnancy and suffered other ailments. Employer was fully aware of her medical issues, which required doctor appointments on a weekly basis. Claimant testified that in July 2015, Employer reduced her hours to 25 hours per week; took away her desk; and assigned her work to other employees. The office manager informed Claimant that Employer made these changes because she had too many doctor's appointments. Claimant resigned.

         Claimant explained that when she applied for unemployment compensation benefits, she used the Department of Labor's website. Notes of Testimony, 10/16/2015, at 9 (N.T.). Claimant checked the box labelled "lack of work" as her reason for her separation from Employer. She explained her choice as follows:

[Referee]: … when you filed your claim for benefits, you gave your reason for separation as lack of work, is that correct?
[Claimant]: Yes .... I misunderstood it[.] I didn't realize what that really meant I guess.
….
[Counsel]: Did you, as part of your claim, did you mention about these medical issues and getting less hours and anything else?
[Claimant]: I believe so, that's what I thought lack of hours, or lack of work meant because [the officer manager] had cut my hours so that's what I assumed it meant, I didn't realize it meant like they didn't have work for me. So I misunderstood that.

N.T. at 8-9. In short, Claimant construed "lack of work" to refer to a reduction in work available to her, which described her situation.

         The Referee affirmed the Service Center's determination in part and reversed in part. The Referee agreed that Claimant was ineligible for unemployment compensation under Section 402(b) of the Law because she had failed to establish a necessitous and compelling reason for leaving her employment. The Referee also agreed that Claimant was at fault for the overpayment of her unemployment compensation because she reported "lack of work" as the reason for her separation from Employer, and this was not strictly accurate. However, the Referee reversed the Service Center's imposition of penalties, explaining as follows:

[I]t appears [Claimant] made a mistake when she entered her reason for separation from [Employer], and [] there is no evidence [Claimant] intentionally failed to disclose information, or that she made false statements[.]

         Referee Decision at 3 (emphasis added). Claimant appealed to the Board.

         On review, the Board adopted the Referee's findings of fact and conclusions of law and affirmed the Referee's order. Claimant now petitions for this Court's review of the Board's adjudication.[4]

         On appeal, Claimant argues that the Board erred in finding that she was at fault for the overpayment of benefits. She contends that her mistaken understanding of "lack of work" on the Department's application does not rise to the level of "fault." Indeed, the Referee found "no evidence [Claimant] intentionally failed to disclose information, or that she made false statements[.]" Referee Decision at 3. The Board counters that Claimant was at fault because she chose ...


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