Magee v. Director, Employment Security Department

92 S.W.3d 703, 80 Ark. App. 162, 2002 Ark. App. LEXIS 736

• Court: Court of Appeals of Arkansas
• Decided: December 18, 2002
• Docket: E 01-293
• Status: Published

Opinions

John E. Jennings, Judge.

John Magee was employed as the plant manager by U.S. Agricultural, Inc. His father, Allan Magee, and Ed Howard were co-owners.of the business. Allan Magee was the president, and Mr. Howard was the treasurer.

Appellant quit his job in June 2000. Some four months earlier he had increased his own salary from $590.00 a week to $670.00 a week. When Mr. Howard learned of this, he reduced appellant’s salary back to its former level. Appellant then quit.

Appellant filed a claim for unemployment benefits. The Board of Review denied the claim on a finding that appellant had failed to take appropriate steps to prevent the mistreatment from continuing. In an earlier decision, we held that this finding was not supported by substantial evidence and remanded the case to the Board with the direction that it determine whether the appellant had good cause to quit his work. See Magee v. Director, 75 Ark. App. 115, 55 S.W.3d 321 (2001). On remand the Board determined that appellant did not have good cause to quit work, and the appellant has once again appealed, contending that the Board’s decision is not supported by substantial evidence. We affirm.

“Good cause is a cause that would reasonably impel an average, able-bodied, qualified worker to give up his or her employment.” Garrett v. Director, 58 Ark. App. 7, 944 S.W.2d 865 (1997). We will affirm the Board’s decision on a question of fact if it is supported by substantial evidence. Rankin v. Director, 78 Ark. App. 174, 79 S.W.3d 885 (2002). Substantial evidence is such evidence as a reasonable mind might accept as adequate to support a conclusion. Walls v. Director, 74 Ark. App. 424, 49 S.W.3d 670 (2001). In the case at bar the Board of Review stated:

The general rule is that a substantial pay reduction gives an employee good cause for quitting. Yet, there is no set percentage or bright-line rule that makes a reduction in pay “substantial.” The weight of authority, however, appears to be that a reduction of over twenty percent is so substantial as to compel an employee to quit a job and have good cause to do so, but a reduction of less than twenty percent is not.

In this case, restoring the claimant’s salary to its previous level amounted to a reduction of approximately eleven-percent. The Board finds that this reduction is not substantial and does not constitute good cause for quitting the employment.

Although the Board reviewed a number of cases from other jurisdictions, it clearly recognized that there was no “bright-line rule.” The Board’s decision is therefore consistent with our statement in Price v. Everett, 2 Ark. App. 98, 616 S.W.2d 766 (1981), that “there is no talismanic percentage figure that separates a substantial reduction in salary from one that is not.” We are unwilling to hold that an eleven-percent reduction in salary, under the facts and circumstances of this case, constitutes good cause for quitting, as a matter of law.

As we discussed in our earlier opinion, there were additional problems between appellant and Mr. Howard relating to the ordering of supplies. On this issue the Board found:

As to the four examples the claimant offered concerning the Secretary-Treasurer’s refusal to pay, the requested repairs were ultimately made and the requested materials were ultimately purchased. The Secretary-Treasurer’s assertion that cash flow problems delayed the payment of the bills was not disputed and is a reasonable explanation concerning the delay.

The Board’s findings on this issue are supported by substantial evidence and are, therefore, conclusive. See Terry Dairy Products Co., Inc., v. Cash, 224 Ark. 576, 275 S.W.2d 12 (1955). For the reasons stated, the decision of the Board of Review is affirmed.

Affirmed.

Pittman, Robbins, Bird, Neal, and Vaught, JJ., agree. Hart, Griffen, and Roaf, JJ., dissent.