Michelle Davidsavor, Relator v. Department of Employment and Economic Development ( 2015 )

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A15-0072
Michelle Davidsavor,
Relator,
vs.
Department of Employment and Economic Development,
Respondent.
Filed August 31, 2015
Reversed
Schellhas, Judge
Department of Employment and Economic Security
File No. 32974034-2
William E. Dane, University Student Legal Service, University of Minnesota,
Minneapolis, Minnesota (for relator)
Lee B. Nelson, Tim Schepers, Department of Employment and Economic Development,
St. Paul, Minnesota (for respondent)
Considered and decided by Reyes, Presiding Judge; Schellhas, Judge; and Larkin,
Judge.
UNPUBLISHED OPINION
SCHELLHAS, Judge
Relator raises procedural and substantive challenges to an unemployment-law
judge’s decision that she was ineligible for unemployment benefits. We reverse.
FACTS
During the 2013–2014 academic year, relator Michelle Davidsavor worked 20 to
40 hours per week as a server at a restaurant and attended classes in pursuit of a master’s
degree in human resources (HR). After completing an HR internship at a construction
company in the summer of 2014, Davidsavor was unable to return to her service position
as planned because the restaurant had closed. Davidsavor established an unemployment
benefits account, and respondent Minnesota Department of Employment and Economic
Development (DEED) issued a determination that Davidsavor was eligible for
unemployment benefits for the week of August 24, 2014.
In early September 2014, Davidsavor resumed her HR studies, attending classes
only on Wednesdays from 2:30 p.m. to 9:05 p.m. On September 24, Davidsavor missed a
scheduled reemployment-and-eligibility-assessment (REA) session in order to participate
in an information session regarding a prospective job. DEED therefore issued a
determination that Davidsavor was not eligible for unemployment benefits for the week
of September 21.
Davidsavor appealed the ineligibility determination; an unemployment-law judge
(ULJ) conducted an evidentiary hearing by telephone conference, at which only
Davidsavor testified. The ULJ decided that Davidsavor was not eligible for
unemployment benefits from August 31, 2014, to the date of the hearing and continuing
until conditions change, based on his finding that Davidsavor was not available for and
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actively seeking suitable employment after August 31.1 Davidsavor submitted a request
for reconsideration. The ULJ issued an order of affirmation in which he clarified that the
ineligibility decision was based on a finding that Davidsavor was not available for
suitable employment, rather than a finding that Davidsavor was not actively seeking
suitable employment.
This certiorari appeal follows.
DECISION
The purpose of the Minnesota Unemployment Insurance Law is to assist those
who are unemployed through no fault of their own. Minn. Stat. § 268.03, subd. 1 (2014).
Chapter 268 is remedial in nature and must be applied in favor of awarding benefits; any
provision precluding receipt of benefits must be narrowly construed. Minn. Stat.
§ 268.031, subd. 2 (2014). “An applicant’s entitlement to unemployment benefits must be
determined based upon that information available without regard to a burden of proof.”
Minn. Stat. § 268.069, subd. 2 (2014). Unemployment benefits may not be denied or
allowed on equitable or common-law grounds. Id., subd. 3 (2014).
We may reverse or modify a ULJ’s decision if the relator’s substantial rights
may have been prejudiced because the [ULJ’s] findings,
inferences, conclusion, or decision are:
(1) in violation of constitutional provisions;
(2) in excess of the statutory authority or jurisdiction of
[DEED];
1
The ULJ found that Davidsavor had missed the September 24 REA session with “good
cause” and did not base his ineligibility decision, in whole or in part, “on the grounds that
she missed her REA session.”
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(3) made upon unlawful procedure;
(4) affected by other error of law;
(5) unsupported by substantial evidence in view of the entire
record as submitted; or
(6) arbitrary or capricious.
2015 Minn. Laws 1st Spec. Sess. ch. 1, art. 6, § 12 (amending Minn. Stat. § 268.105,
subd. 7(d) (2014)). “In unemployment benefit cases, the appellate court is to review the
ULJ’s factual findings in the light most favorable to the decision and should not disturb
those findings as long as there is evidence in the record that reasonably tends to sustain
them.” Stagg v. Vintage Place Inc., 796 N.W.2d 312, 315 (Minn. 2011) (quotation
omitted). But “we exercise independent judgment with respect to questions of law,” Rowe
v. Dep’t of Emp’t & Econ. Dev., 704 N.W.2d 191, 194 (Minn. App. 2005) (citing Ress v.
Abbott Nw. Hosp., Inc., 448 N.W.2d 519, 523 (Minn. 1989)), and “we review the ULJ’s
ineligibility determination de novo,” Neumann v. Dep’t of Emp’t & Econ. Dev., 844
N.W.2d 736, 738 (Minn. App. 2014) (citing Ress, 448 N.W.2d at 523).
Procedural challenges
Davidsavor first argues that “the ULJ failed to provide [her] with adequate notice
that her availability for work and her efforts to seek work were going to be considered at
the hearing.” The notice of hearing indicates that the “[i]ssues to be [c]onsidered at th[e
h]earing” were limited to “[w]hether . . . Davidsavor has participated in reemployment
assistance services or whether there is good cause for a failure to do so.” The ULJ also
stated at the beginning of the hearing that “[t]he issue today appears to be whether
[Davidsavor] had good cause for missing a reemployment eligibility assessment training
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session.” But about midway through the hearing, after eliciting Davidsavor’s testimony
regarding her reasons for missing the REA session, the ULJ said:
The statement that you listed in your appeal statement and the
little bit of testimony that you’ve given me today requires me
to raise another issue on your account and that’s the issue
involving your school classes and any impact that that would
have on your eligibility to receive unemployment benefits.
The ULJ informed Davidsavor, “[I]f you wish, we can do this today. We can get this
done today. I’ll ask you questions about your class schedule and . . . what types of . . .
work you’re looking for.” The ULJ continued:
If you don’t want to do this today, you don’t have to. If
we’re not going to do it today, then what that would mean is,
it would be scheduled, the hearing would be in front of me
about two or three weeks out and we’d be going through the
same things that we’d be otherwise be going through today.
The ULJ asked Davidsavor, “[A]re you able to do this today?” Davidsavor responded
affirmatively, and the ULJ proceeded to question Davidsavor about her education and
employment history and plans, in connection with Davidsavor’s availability for and
efforts to obtain a suitable job.
Davidsavor argues that the ULJ’s expansion of the scope of the hearing violated
DEED rules and the Due Process Clause of the Minnesota Constitution and that, as a
result, the ULJ’s decision that Davidsavor was not eligible for unemployment benefits
was made upon unlawful procedure and in violation of constitutional provisions. We
disagree. “[An] unemployment law judge may take testimony and render a decision on
issues not listed on the notice of hearing if each party is notified on the record, is advised
of the right to object, and does not object.” Minn. R. 3310.2910 (Supp. 2014). The ULJ
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notified Davidsavor on the record of his intention to address the potential impact of
Davidsavor’s classwork on her eligibility for unemployment benefits; he also advised her
on the record that he would not do so at the present time if she did not want him to do so.
Davidsavor did not object to the ULJ’s immediate consideration of the previously
unnoticed issue; instead, she expressly consented to such consideration. The ULJ did not
violate rule 3310.2910.
Davidsavor also argues that the midhearing notice was inadequate under DEED
rules because it did not inform Davidsavor that “(1) the hearing [wa]s [her] only
opportunity to present evidence, (2) a subsequent appeal w[ould] only consider evidence
presented at the hearing, and (3) it [wa]s important to participate in the hearing because,
if [Davidsavor wa]s deemed ineligible for benefits, [she] w[ould] have to pay back
benefits received.” Davidsavor cites Minn. R. 3310.2905 as the source of these and other
notice requirements. But the cited rule does not set forth requirements for a midhearing
notice permitted under rule 3310.2910; rather, it sets forth requirements for a written
notice of hearing, which necessarily predates the hearing. See Minn. R. 3310.2905, subp.
2 (Supp. 2014) (providing that “[t]he chief unemployment law judge must send a notice
of hearing, by mail or electronic transmission, to each party at least ten calendar days
before the scheduled date of hearing,” and specifying information that must be included
in the notice of hearing). Davidsavor provides no authority in support of her attempt to
import rule 3310.2905’s requirements for a prehearing written notice of hearing into a
rule 3310.2910 midhearing oral notice of previously unnoticed issues.
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To the extent that Davidsavor makes a due-process argument that does not rely on
the ULJ’s supposed noncompliance with DEED rules, such argument lacks merit. “The
fundamental requirements of due process are notice and an opportunity to be heard at a
meaningful time and in a meaningful manner.” Rew v. Bergstrom, 845 N.W.2d 764, 786
(Minn. 2014) (quotation omitted). “Procedural due process is flexible and calls for such
procedural protections as the particular situation demands.” In re Source Code
Evidentiary Hearings, 816 N.W.2d 525, 540 n.16 (Minn. 2012) (quotation omitted).
Davidsavor agreed to address the previously unnoticed issue at the hearing despite being
told that she could address the issue in “two or three weeks” instead. Moreover, after
questioning Davidsavor about the issue, the ULJ gave Davidsavor an opportunity to be
heard on any fact not yet brought to light and to make a closing statement. Finally, the
previously unnoticed issue centered around Davidsavor’s class schedule, employment
history, and job-search efforts—nontechnical topics with which Davidsavor was familiar
without advance preparation. The situation did not demand greater procedural protections
than Davidsavor received; therefore, the ULJ’s decision was not made upon unlawful
procedure or in violation of constitutional provisions.
Substantive challenges
Davidsavor challenges the merits of the ULJ’s finding that she was unavailable for
suitable employment, arguing that the finding is not supported by substantial evidence.
To be eligible for unemployment benefits in a given week, an applicant must be available
for suitable employment during that week. Minn. Stat. § 268.085, subd. 1(4) (2014).
“‘Available for suitable employment’ means an applicant is ready, willing, and able to
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accept suitable employment” and is placing “no . . . restrictions, either self-imposed or
created by circumstances, temporary or permanent, that prevent accepting suitable
employment.” Id., subd. 15(a) (2014).
[T]o be considered “available for suitable employment,” a
student who has regularly scheduled classes must be willing
to discontinue classes to accept suitable employment when:
(1) class attendance restricts the applicant from accepting
suitable employment; and (2) the applicant is unable to
change the scheduled class or make other arrangements that
excuse the applicant from attending class.
Id., subd. 15(b) (2014). Whether an applicant is available for suitable employment is a
question of fact. Semanko v. Dep’t of Emp’t Servs., 309 Minn. 425, 428, 244 N.W.2d
663, 665 (1976).
In this case, the ULJ found that Davidsavor was unavailable for suitable
employment because she had regularly scheduled classes on Wednesday afternoons and
evenings during the relevant period and “[she] would not have quit school to accept one
of the jobs for which she was applying.” The ULJ appears to have based this finding on
the following testimony by Davidsavor:
Q: What would have happened if you applied for . . . one of
these restaurant jobs or an entry level HR job and they said,
. . . we really need someone, . . . we’re really desperate for
people with the hours but we need someone who can commit
to like a standard 40 hour work week, Monday through
Friday?
....
A: I’ve had that happen and, you know, I just negotiated my
hours with them. I told them I could do, you know, the
normal hours Monday through Friday, except Wednesday I
could come in for a half a day, and then if I needed to make
up my hours on the other days throughout the week then that
would be okay with me and most of them were okay with it.
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The ULJ interpreted this testimony to suggest that Davidsavor would have declined a
job offer from a prospective employer had that employer refused to “negotiate[ her]
hours” to accommodate her class schedule.
But a ULJ’s factual findings must be supported by “substantial evidence in view
of the entire record as submitted.” See Minn. Stat. § 268.105, subd. 7(d)(5) (emphasis
added); see also Cunningham v. Wal-Mart Assocs., Inc., 809 N.W.2d 231, 235 (Minn.
App. 2011) (stating that “[f]indings of fact will be upheld if they are supported by
substantial evidence in light of the entire record” (emphasis added)). Nothing in the
record shows that Davidsavor ever declined a job offer because the prospective
employer was unwilling to accommodate her class schedule. Indeed, Davidsavor also
testified:
Q: When [DEED] sent you a questionnaire earlier, you said
that regarding the school issue, you indicated that you’d be
willing to quit or rearrange your classes in order to accept
work, but that you were unavailable on Wednesdays.
A: Correct.
Q: You would agree with that that . . . that’s still the correct
answer?
A: Yes.
Q: Okay.
A: Actually, I just accepted a job offer.
Q: Oh, well congratulations.
And the ULJ expressly found that “Davidsavor’s testimony that she was willing to be
very flexible in accepting a job was credible.” “[W]e must defer to the ULJ’s factually
supported credibility determination.” Haugen v. Superior Dev., Inc., 819 N.W.2d 715,
723 (Minn. App. 2012). Thus, when viewed as a whole, the record does not contain
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substantial evidence that Davidsavor was “[un]willing to discontinue classes to accept
suitable employment.” See Minn. Stat. § 268.085, subd. 15(b).
Moreover, a student-applicant need not be “willing to discontinue classes” if the
applicant is able either to “change the scheduled class” that conflicts with suitable
employment or to “make other arrangements that excuse the applicant from attending
class.” See id. And although Davidsavor had regularly scheduled classes on Wednesday
afternoons and evenings during the relevant period, she testified that
I guess class-wise I’ve had to miss a couple of my classes for
like an interview or information session and the professors are
pretty understandable [sic] with that as long as you inform
them ahead of time. So, if . . . work really needed me on that
Wednesday then I could work something out with my
professors . . . .
The ULJ characterized this testimony as “indicat[ing] that [Davidsavor] could miss an
occasional class if needed for work,” stating that “[t]he implication was that she would be
willing to miss a class or two if she were really needed on a given Wednesday; it was not
that she would drop out of school entirely.” But Davidsavor’s ability to “work something
out with [her] professors” if necessary to accommodate her acceptance of suitable
employment permitted her to remain in school without sacrificing her eligibility for
unemployment benefits. See id. On these facts, we conclude that the ULJ’s finding that
Davidsavor was not available for and actively seeking suitable employment after
August 31, 2014, is “unsupported by substantial evidence in view of the entire record as
submitted.” See Minn. Stat. § 268.105, subd. 7(d)(5).
Reversed.
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