High court: Woman’s errors not substantial fault

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Majority skirts agency-deference issue, concurrences show justices divided

The Wisconsin Supreme Court has held that government officials incorrectly denied a woman her unemployment benefits under a recently enacted law intended to make it tougher to get benefits.

The unanimous decision, written by Chief Justice Pat Roggensack and handed down Thursday, was the first case to interpret a law legislators passed in 2013 to strengthen the standards governing denials of unemployment benefits.

Managers at a Walgreens store in Madison fired Lela Operton in 2014 after she had made errors in eight of the 80,000 transactions she had taken part in as a cashier.

When she tried to file for unemployment benefits, the state Department of Workforce Development denied her claim, saying her errors amounted to misconduct. When Operton appealed, an administrative-law judge pointed to the state’s new standard for denying benefits, known as substantial fault.

Approved by the state Legislature in 2013, substantial fault came in response to employers’ complaints that Wisconsin was being too lenient in doling out unemployment benefits.

Even though the new law has been around for almost four years, knowing exactly what it means has proved tricky. Part of the trouble is that the new standard of substantial fault is defined largely using negative statements – by saying what it isn’t.

According to state statute, substantial fault involves neither minor infractions of the rules, unless they are repeated after a warning, nor failures to perform work because of insufficient skill, ability or equipment. One or more inadvertent errors also are not enough to constitute substantial fault.

In considering whether substantial fault was applied correctly in Operton’s case, the justices on Thursday found that the mistakes Operton had made fit into the category of inadvertent errors. They pointed out that Operton had made only a handful of mistakes over the course of her years-long employment. The justices also noted that she went months without committing an error and, when she did make one, she had violated different procedures each time.

All seven justices agreed that Operton should receive jobless benefits because her errors were inadvertent. Some of them went further than that, though. In a concurrence, several justices went on to dipsute whether the Labor and Industry Review Commission, which reviews DWD’s administrative law judges’ decisions, was due great-weight deference.

Generally speaking, government agencies are given broad leeway to interpret the rules and laws that they are responsible for enforcing.

LIRC had argued it was due that deference, but the Court of Appeals disagreed, noting that the commission has no long-standing history of interpreting the state’s relatively new substantial-fault standard. The appeals court reviewed LIRC’s decision de novo.

The majority opinion found that LIRC had failed to discuss inadvertent errors in its decision, so whatever deference it was owed was “inconsequential.”  The majority instead went straight to interpreting the substantial-fault statute.

In her concurring opinion, Justice Shirley Abrahamson, disagreed, saying she believed the Court of Appeals got it right and the court owed LIRC no deference because LIRC had never interpreted substantial fault before. She also disagreed with the majority’s analysis of substantial fault, saying it had strayed from the statute’s text. Justice Ann Walsh Bradley joined in Abrahamson’s concurrence.

Also contributing concurrences to the majority opinion Thursday were various conservative-leaning justices.

Justice Annette Ziegler’s concurrence noted that the parties in the case had not asked the court to change Wisconsin’s well-established law on agency deference and that the issue should be thoroughly briefed before the court should allow any party to seek that a change to that law.

Justice Rebecca Bradley, joined by Justices Michael Gableman and Dan Kelly, questioned whether established law concerning agency deference comports with the state Constitution. They urged the court to reconsider its position.

“The doctrine of deference to agencies’ statutory interpretation is a judicial creation that circumvents the court’s duty to say what the law is and risks perpetuating erroneous declarations of the law,” she wrote.

The justices’ ruling Thursday affirmed a decision the state Court of Appeals had handed down last year in favor of Operton. Before that favorable decision, Operton had tried unsuccessfully three times to win appeals in her case. She had appeared first before an administrative-law judge, then the Labor and Industry Review Commission and, finally, Dane County Circuit Court Judge John Albert.

Thursday’s decision sends Operton’s case back to LIRC, which has been ordered to decide how much in benefits the state owes Operton. Follow @erikastrebel