George M. Walker, V. Department Of Employment Security

• Court: Court of Appeals of Washington
• Decided: October 23, 2023
• Docket: 85060-1
• Status: Unpublished

Opinion

IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

GEORGE M. WALKER, No. 85060-1-I

Appellant, DIVISION ONE

v. UNPUBLISHED OPINION

STATE OF WASHINGTON, EMPLOYMENT SECURITY DEPARTMENT,

Respondents.

FELDMAN, J. — George M. Walker appeals an order from the

Commissioner’s Review Office (CRO) affirming the decision of the Employment

Security Department (ESD) denying his application for Pandemic Unemployment

Assistance (PUA) under the Coronavirus Aid, Relief, and Economic Security

(CARES) Act. Walker argues that the Commissioner erred when she determined

he is not a “covered individual” under 15 U.S.C. § 9021(a)(3). We set aside the

Commissioner’s decision and remand the matter to ESD to grant Walker’s

application for PUA.

FACTS

At all times relevant herein, Walker worked as a “handyman,” which

included jobs such as demolition, concrete work, small engine repair, and various No. 85060-1-I/2

other tasks. In 2019, Walker’s stated income was $10,000. In 2020, the COVID-

19 public health emergency limited Walker’s ability to retain these jobs. As a

result, his stated income reduced to $5,000. To make up for the loss of income,

Walker filed an application for PUA.

ESD denied Walker’s application for PUA. Walker appealed the decision

to an administrative law judge (ALJ) at the Office of Administrative Hearings, and

requested a hearing. At the hearing, Walker testified how there was limited work

available to him due to the COVID-19 pandemic. The ALJ repeated this

testimony in his written decision, noting “The Claimant testified that the COVID-

19 Pandemic has limited his work in that many elderly people, who he had done

various work for over the years, essentially ‘closed down’ when the Pandemic

started, preventing him from doing any work for them.” Acknowledging Walker’s

self-employment status, the ALJ also found that “the Claimant recognized $5,000

of earned income from ‘farm labor and construction’” on his “tax year 2020

return.” Despite these findings, the ALJ concluded that “the Claimant is

ineligible” for PUA.

Walker appealed the ALJ’s decision to the CRO where a commissioner

affirmed the ALJ’s decision and adopted the ALJ’s findings of fact and

conclusions of law. The Commissioner reasoned that because Walker did not

substantiate his assertion that he was self-employed he was ineligible for PUA

benefits. In reaching this conclusion, the Commissioner noted that Walker

“provided no receipts, 1099 forms or other indicia of any sort of self-employment

activities at the hearing . . . beyond his own assertions.” Further, the

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Commissioner noted “Washington has set out what evidence must be presented

to show self-employment, and it is quite clear that [Walker] has failed to show

any substantiation beyond his words, that he is self-employed.” As a result, the

Commissioner affirmed the ALJ’s determination.

Walker appealed the Commissioner’s decision to Thurston County

superior court where direct review was granted under RCW 34.05.518. To

expedite review, the matter was transferred to this division of the Court of

Appeals.

ANALYSIS

A. Standard of Review

Under the CARES Act, all levels of appeals made with regard to PUA

“shall be conducted in the same manner and to the same extent as the

applicable State would conduct appeals of determinations or redeterminations

regarding rights to regular compensation under State law.” 15 U.S.C. §

9021(c)(5)(B)(ii). The Washington Administrative Procedure Act (APA) governs

judicial review of a final decision by an ESD Commissioner. Verizon Nw., Inc. v.

Emp’t Sec. Dep’t, 164 Wn.2d 909, 915, 194 P.3d 255 (2008). The burden of

demonstrating the invalidity of agency action is on the party asserting invalidity.

RCW 34.05.570(1)(a). We review the Commissioner's ruling rather than the

underlying ALJ’s decision, but if the Commissioner adopts the ALJ’s findings of

fact, we review the ALJ’s findings. Tapper v. Emp’t Sec. Dep’t, 122 Wn.2d 397,

405-06, 858 P.2d 494 (1993). We review the Commissioner’s legal conclusions

for errors of law, and we may reverse the Commissioner’s decision if the

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Commissioner based their decision on an error of law. RCW 34.05.570(3)(d);

Griffith v. Dep’t of Emp’t Sec., 163 Wn. App. 1, 6, 259 P.3d 1111 (2011).

Applying the error of law standard, we review the agency record de novo.

Verizon Nw., 164 Wn.2d at 916.

B. Pandemic Unemployment Assistance

To be eligible for PUA, Walker had to meet three requirements under the

CARES Act. 15 U.S.C. § 9021(a)(3)(A)(i), (ii), and (iii); see Unemployment

Insurance Program Letter (UIPL) No. 16-20, Change 4, attachment 1, at 4 (Jan.

8, 2021). 1 First, Walker was required to be ineligible for regular compensation or

extended benefits under State or Federal law or pandemic emergency

unemployment compensation. 15 U.S.C. § 9021(a)(3)(A)(i). Second, Walker

was required to self-certify that he is self-employed and otherwise able to work,

but unable to work due to one of eleven COVID-19 related reasons enumerated

in the statute. 15 U.S.C. § 9021(a)(3)(A)(ii). And third, Walker was required to

provide documentation substantiating his self-employment. 15 U.S.C. §

9021(a)(3)(A)(iii). Because neither party disputes that Walker was ineligible for

regular compensation or extended benefits under State or Federal law or

pandemic emergency unemployment compensation, we do not address the first

requirement and focus instead on the two other requirements.

Regarding the second requirement—that Walker self-certify he is self-

employed and otherwise able to work, but unable to work due to one of eleven

1 https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2021/UIPL_16-20_Change_4.pdf

(last visited October 9, 2023).

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COVID-19 related reasons enumerated in the statute (15 U.S.C. §

9021(a)(3)(A)(ii)(I)(aa)-(kk))—Walker argues he satisfies 15 U.S.C. §

9021(a)(3)(A)(ii)(I)(kk) (hereinafter “section kk”). This provision requires Walker

to self-certify that he is able to work, but unable to work due to his “customary

work activities” being “severely limited by the COVID-19 public health

emergency.” UIPL No. 16-20, Change 2, at 2 (July. 21, 2020). 2 We conclude

that Walker meets the requirements of section kk.

The Department of Labor (DOL) advised State Workforce Agencies in an

Unemployment Insurance Program Letter (UIPL) that section kk provides PUA

coverage for “independent contractor[s] whose ability to continue performing

[their] customary work activities [are] severely limited because of the COVID-19

public health emergency.” Id. The same letter goes on to explain “an

independent contractor who experiences a ‘significant diminution of work as a

result of COVID-19’ may be eligible for PUA.” Id.

DOL defines “self-employed individual” as “an individual whose primary

reliance for income is on the performance of services in the individual’s own

business, or on the individual’s own farm.” 20 C.F.R. § 625.2(n). DOL expanded

the definition to include “independent contractors, gig economy workers, and

workers for certain religious entities.” UIPL No. 16-20, attachment 1, at 3 (April

5, 2020). 3 Walker testified at the hearing before the ALJ that he is an

2 https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2020/UIPL_16-20_Change_2.pdf

(last visited Oct. 9, 2023). 3 https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2020/UIPL_16-20.pdf (last visited Oct. 9, 2023).

5 No. 85060-1-I/6

independent contractor who does various “handyman stuff” such as “small

engine repair, demo work for buildings -- a farm -- a barn. . . . I did the concrete

prep for a concrete pad.”

Walker also testified that his opportunities to work were limited by the

COVID-19 Pandemic. He explained that “[i]n [his] community, it’s mostly elderly.

And as soon as things started getting real with COVID, then everybody started,

you know, shutting their doors.” He testified that he was able to earn around

$10,000 in 2019, and was only able to earn $5,000 in 2020. He testified that the

COVID-19 pandemic limited his ability “to get any kind of work.”

The ALJ accepted and agreed with Walker’s testimony. Summarizing the

testimony, the ALJ’s findings of fact indicate:

4. The Claimant has undertaken ‘handyman jobs’ for several years, including farm labor, construction, small engine repair and concrete prep. 5. The Claimant has worked for approximately 8 different people doing these odd jobs over the last few years. 6. The Claimant worked for Steve White and Lee Smith doing building demolition in 2020. 7. The Claimant testified that the COVID-19 Pandemic has limited his work in that many elderly people, who he had done various work for over the years, essentially ‘closed down’ . . . .

(Internal quotation marks omitted.) As confirmed by the ALJ’s findings of fact,

Walker was able to self-certify according to DOL’s guidance that his “customary

work activities” were “severely limited because of the COVID-19 public health

emergency.” See UIPL No. 16-20, Change 2, at 2 (July 21, 2020). On this

record, the second requirement to be a covered individual for PUA is satisfied

here.

Turning to the third requirement to receive PUA—that Walker provide

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documentation substantiating his self-employment (15 U.S.C. §

9201(a)(3)(A)(iii))—DOL has advised that “documentation to substantiate

employment or self-employment need only demonstrate the existence of

employment or self-employment at some point between the start of the

applicable tax year and the date of filing.” UIPL No. 16-20, Change 4,

attachment 1, at 10 (Jan. 8, 2021). The advice went on to list examples of

acceptable documentation which included tax returns. Id. ESD likewise includes

tax returns as acceptable forms of documentation to substantiate employment. 4

Walker provided a tax return detailing his income in 2020. A tax return is

one of the forms of documentation that DOL and ESD identified as acceptable to

substantiate self-employment. Id. Because Walker provided documentation that

was determined acceptable by DOL and ESD, the Commissioner erroneously

applied 15 U.S.C. § 9021(a)(3)(A)(iii) when it concluded Walker’s tax return was

insufficient to substantiate his self-employment. Thus, all three requirements to

be a covered individual for PUA are satisfied here.

Notwithstanding the above analysis, ESD argues that Walker’s work was

not self-employment as contemplated by the CARES Act because Walker’s

testimony revealed his work was “sporadic” and “intermittent.” ESD likewise

argues that the Commissioner correctly concluded that Walker’s “infrequent

casual labor is not employment or self-employment,” and, as a result, Walker’s

“unemployment predates the COVID-19 pandemic and the [PUA] program.” We

4 The Washington Employment Security Department’s website lists acceptable

documents to substantiate self-employment at https://esd.wa.gov/unemployment/pua- documents-required (last visited October 6, 2023).

7 No. 85060-1-I/8

reject these arguments because the definition of self-employment does not

exclude work that is “sporadic” and “intermittent.” See 20 C.F.R. § 625.2(n). And

the ALJ’s own findings show that Walker was self-employed: “[t]he Claimant has

undertaken ‘handyman’ jobs for several years, including farm labor, construction,

small engine repair and concrete prep.” The ALJ found that Walker testified that

he earned around $10,000 in 2019, and recognized $5,000 of income in his tax

return for 2020. Further, the ALJ’s own findings show that Walker was able to

self-certify that his own work was severely limited by the COVID-19 pandemic:

“[Walker] testified that the COVID-19 Pandemic has limited his work in that many

elderly people, who he had done various work for over the years, essentially

‘closed down.’” As a result, contrary to ESD’s arguments and the

Commissioner’s corresponding ruling, the ALJ’s findings show Walker was able

to self-certify under section kk.

At oral argument, ESD emphasized that DOL gave “States . . . [the]

discretion to determine if the documentation an individual submits substantiates

an individual’s . . . self-employment” and argued that the Commissioner properly

exercised that discretion. Wash. Court of Appeals oral argument, Walker v.

Emp’t Sec. Dep’t, No. 85060-1-I (Sept. 28, 2023), at 16 min., 50 sec. through 17

min., 18 sec.; see UIPL No. 16-20, Change 4, attachment 1, at 11 (Jan. 8, 2021).

The Commissioner did not exercise the discretion contemplated in DOL’s

guidance documents. Instead, the Commissioner concluded that Walker “failed

to provide documentary evidence supporting self-employment” and added that

Walker “failed to show any substantiation beyond his words, that he is self-

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employed.” Contrary to the Commissioner’s ruling, Walker had provided a copy

of his 2020 tax return, which both DOL and ESD listed as an acceptable form of

documentation to substantiate self-employment. And while Walker prepared his

own tax return, as many taxpayers do, he submitted it under penalty of

perjury. 26 U.S.C. § 6065. ESD’s argument that it had, and exercised,

unfettered discretion to reject Walker’s tax return as an unacceptable form of

documentation thus fails.

As noted previously, our review here is governed by the APA, which

states, “The court shall grant relief from an agency order in an adjudicative

proceeding only if it determines that . . . [t]he agency has erroneously interpreted

or applied the law.” RCW 34.05.570(3)(d). Here, the agency erroneously

interpreted and applied the law when it concluded that Walker had not met the

three requirements to be eligible for PUA under section kk. Having found an

error of law, RCW 34.05.574(1) provides the type of relief that this court may

grant under the APA. The court may: “order an agency to take action required by

law, order an agency to exercise discretion required by law, set aside agency

action, enjoin or stay the agency action, remand the matter for further

proceedings, or enter a declaratory judgment order.” As RCW 34.05.574(1)

permits, we set aside the Commissioner’s decision and remand the matter to

ESD to grant Walker’s application for PUA under the CARES Act. 5

5 Walker also argues he satisfies another COVID-19 related reason, 15 U.S.C. §

9021(a)(3)(A)(ii)(I)(kk) (hereinafter “section dd”). Because we conclude that Walker is entitled to the relief he seeks under section kk, we need not reach Walker’s argument under section dd.

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C. Attorney fees

Lastly, we decline to grant Walker’s request for attorney fees. RAP 18.1

requires a party to “devote a section of its opening brief to the request for

[attorney] fees or expenses.” Walker failed to comply with RAP 18.1. As a

result, we deny Walker’s request for attorney fees and costs.

WE CONCUR: