Mary D. Isaacson, Relator v. The Anthem Companies, Inc., Department of Employment and Economic Development

• Court: Court of Appeals of Minnesota
• Decided: July 27, 2015
• Docket: A14-1486
• Status: Unpublished

Opinion

This opinion will be unpublished and may not be cited except as provided by Minn.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 A14-1486

Mary D. Isaacson, Relator,

vs.

The Anthem Companies, Inc., Respondent,

Department of Employment and Economic Development, Respondent.

Filed July 27, 2015 Affirmed Hooten, Judge

Department of Employment and Economic Development File No. 32321052-3

Thomas Klosowski, Minneapolis, Minnesota (for relator)

The Anthem Companies, Inc., St. Louis, Missouri (respondent employer)

Lee B. Nelson, Munazza Humayun, Department of Employment and Economic Development, St. Paul, Minnesota (for respondent department)

Considered and decided by Halbrooks, Presiding Judge; Schellhas, Judge; and

Hooten, Judge. UNPUBLISHED OPINION

HOOTEN, Judge

Relator challenges the decision of the unemployment law judge that she is

ineligible for unemployment benefits, arguing that she had a good reason to quit caused

by the employer because she was demoted and her job responsibilities were changed. We

affirm.

FACTS

On September 10, 2012, WellPoint, a business division of respondent The Anthem

Companies, Inc., hired relator Mary D. Isaacson to be its director of specialty exchanges,

a product management director position. WellPoint is a health insurance company that

markets and sells health insurance plans throughout the country. Isaacson has substantial

experience in developing and marketing these insurance plans, and she was hired to

create and market WellPoint’s dental, vision, life, disability, and workers’ compensation

plan offerings—so-called “specialty” plans—within the confines of the Affordable Care

Act. In WellPoint terminology, she would “own[] the strategy development” regarding

WellPoint’s specialty healthcare plans. As part of her job, Isaacson regularly met with

senior management at WellPoint in order to discuss issues of strategy and policy

regarding these insurance plans. Isaacson was supervised by a staff vice president for

specialty product development, and he gave Isaacson positive performance reviews from

the time of her hiring until June 2013.

Isaacson’s former supervisor retired in June 2013, and she began reporting directly

to the successor vice president. Isaacson and the new vice president soon began to

2 disagree over the scope of Isaacson’s job responsibilities as the director of specialty

product development. In October 2013, the vice president posted a job opening for a

director of portfolio execution in the specialty division. This newly created position was

“[r]esponsible for overseeing the planning and execution” of the specialty plans at

WellPoint, was a managerial-level position, as opposed to the exempt-level position

Isaacson held, and came with greater compensation than Isaacson’s position. The vice

president admitted that his intention in creating this position was to take the role of

strategy development for specialty healthcare reform away from Isaacson and give it to a

new hire. This new position would also change the reporting structure for Isaacson, as

she would now be directly reporting to the new hire. A product specialist who previously

reported to Isaacson would also report to the new hire.

Isaacson interviewed for the new position, but was not selected. The vice

president testified that she was the lowest-ranked applicant in the interview process.

After Isaacson was not hired for the new position, she retained her current position but no

longer developed strategy. Instead, she was more narrowly tasked with developing

WellPoint’s specialty insurance products. Isaacson’s yearly salary, benefits, and work

hours remained the same. Isaacson, however, claimed that she was not qualified for the

“new” position she now held because she lacked the technical skills required to directly

oversee the execution of these insurance plans. The vice president disputed this claim

and believed that Isaacson would simply be carrying over the responsibilities and

experience that she had regarding insurance product design.

3 In January 2014, Isaacson received a “mixed” review of her job performance from

the vice president. He gave her a satisfactory ranking on the technical aspects of her

position, but gave her a “mixed result” regarding her collaboration and communication

within WellPoint. Isaacson was upset about this performance review, as she believed that

the vice president, who had been her direct supervisor for only six months at that point,

had selectively chosen negative feedback focused on Isaacson’s mannerisms at meetings

and had ignored the fact that she had met her performance goals and had received past

positive reviews from prior supervisors. Isaacson sent a complaint to human resources in

late January regarding this performance review, as well as the conflict between her job

and the newly created position. After meeting with a human resources director, Isaacson

succeeded in having the vice president “soften” the language within the review.

The new director of portfolio execution started working in mid-February. On

February 17, Isaacson sent another complaint to human resources, alleging age

discrimination demonstrated by the creation of the new position and the negative

performance review she received. On February 18, Isaacson submitted a formal notice of

resignation, which took effect on March 3.

Isaacson then applied for unemployment benefits, and respondent Department of

Employment and Economic Development deemed her to be ineligible for benefits

because she quit her job. She appealed the determination of ineligibility, and two

different unemployment law judges (ULJs) held three telephonic hearings on April 25,

May 21, and June 6, 2014. Isaacson and her former supervisor testified on her behalf,

4 while the vice president and a WellPoint human resources director testified on behalf of

the employer.

In his order denying unemployment benefits, the ULJ determined that Isaacson

quit because of the changes to her position and that these changes were attributable to

WellPoint and personally adverse to her. However, the ULJ also determined that these

circumstances were insufficient to cause an average, reasonable worker to quit and

become unemployed, and he therefore found Isaacson ineligible for benefits. Isaacson

requested reconsideration and the ULJ affirmed his decision, reiterating that Isaacson had

not experienced changes to her job that were significant enough to cause an average,

reasonable worker to quit. The matter comes before this court on a writ of certiorari by

Isaacson.

DECISION

On appeal, Isaacson argues that the ULJ erred as a matter of law by determining

that she did not have a good reason to quit caused by WellPoint. We review a ULJ’s

decision to determine whether a relator’s substantial rights have been prejudiced by legal

errors, findings and conclusions not supported by substantial evidence, or a decision that

is arbitrary and capricious. Minn. Stat. § 268.105, subd. 7(d)(4)–(6) (2014). We review

the ULJ’s findings of fact in the light most favorable to the decision and give deference to

its credibility decisions. Skarhus v. Davanni’s Inc., 721 N.W.2d 340, 344 (Minn. App.

2006). However, credibility determinations must be supported by substantial evidence

and the ULJ must set forth a valid reason for crediting or discrediting testimony that may

significantly affect the ultimate decision of the ULJ. Minn. Stat. § 268.105, subd. 1a(a)

5 (2014); see Ywswf v. Teleplan Wireless Servs., Inc., 726 N.W.2d 525, 533 (Minn. App.

2007).

As conceded by the parties and found by the ULJ, Isaacson quit her position with

WellPoint and then applied for unemployment benefits. An unemployment-benefit

applicant who quits his or her job is ineligible for benefits unless he or she falls under a

statutory exception. Minn. Stat. § 268.095, subd. 1 (2014). An applicant who quits his or

her job can receive benefits if he or she “quit the employment because of a good reason

caused by the employer.” Id., subd. 1(1). The statute defines “[a] good reason caused by

the employer for quitting” as a reason: “(1) that is directly related to the employment and

for which the employer is responsible; (2) that is adverse to the worker; and (3) that

would compel an average, reasonable worker to quit and become unemployed rather than

remaining in the employment.” Id., subd. 3(a) (2014). While the applicant’s reason for

quitting is a question of fact, see Beyer v. Heavy Duty Air, Inc., 393 N.W.2d 380, 382

(Minn. App. 1986), whether that reason constituted good cause to quit is a question of

law that we review de novo, Rowan v. Dream It, Inc., 812 N.W.2d 879, 883 (Minn. App.

2012).

The only dispute between the parties on appeal is whether the circumstances

surrounding Isaacson’s employment with WellPoint were sufficient, as a matter of law, to

have caused an average, reasonable employee to quit. “The standard of what constitutes

good cause is the standard of reasonableness as applied to the average man or woman,

and not to the supersensitive . . . .” Ferguson v. Dep’t of Emp’t Servs., 311 Minn. 34, 44

n.5, 247 N.W.2d 895, 900 n.5 (1976) (quotation omitted). This is a fact-specific analysis,

6 Minn. Stat. § 268.095, subd. 3(b), and circumstances relevant to the reasonableness of the

employee’s choice to quit “include loss of wages, the extent of the change of job duties,

the reasonable career expectancies of the employee because of his tenure with this or

other employers, and the employee’s remaining chances for advancement after the

demotion,” Cook v. Playworks, 541 N.W.2d 366, 369 (Minn. App. 1996). “[T]he

circumstances which compel the decision to leave employment must be real, not

imaginary, substantial[,] not trifling, and reasonable, not whimsical; there must be some

compulsion produced by extraneous and necessitous circumstances.” Ferguson, 311

Minn. at 44 n.5, 247 N.W.2d at 900 n.5 (quotation omitted).

Here, the ULJ found that Isaacson quit her job due to the changes in her position at

WellPoint and determined that these changes were attributable to the actions of WellPoint

and were personally adverse to Isaacson “because they reduced her responsibility and

visibility within the organization,” thereby finding that the first two elements of “good

cause” under section 268.095, subd. 3(a), were met. But, the ULJ then determined that,

while “[t]hese circumstances might . . . cause an average, reasonable worker to consider

other job opportunities within and outside of the company,” the circumstances were

insufficient to cause an average, reasonable worker to altogether quit employment

because Isaacson retained the same salary and continued to perform work that she had

already been performing in her position. The ULJ also rejected Isaacson’s claim that she

was unable to perform her new responsibilities, instead finding more credible the

testimony of WellPoint representatives that these responsibilities were fully in line with

the duties Isaacson had already been performing as a product management director. In

7 his order after Isaacson’s request for reconsideration, the ULJ further found that

Isaacson’s concerns regarding career advancement opportunities and loss of earning

potential were not credible and there was no “specific evidence . . . offered to show the

alleged negative impact” stemming from the change in her job duties.

Isaacson challenges the ULJ’s analysis, arguing that the change in her job

responsibilities at WellPoint was a significant “demotion” that would have compelled an

average, reasonable employee in her position to quit and that she therefore had good

cause to quit under section 268.095, subd. 3(a). She primarily argues that she was given

“substantially less responsibility [than] what she had originally accepted employment

for” and that this reduction in her substantive responsibilities would, as a matter of

common sense, adversely affect her future career opportunities and potential for future

salary increases. She further claims that the ULJ wrongly focused on the fact that her

salary remained the same and that she could perform her new job responsibilities, and

that the ULJ incorrectly required specific evidence of the effect her “demotion” would

have on her future career opportunities and pay.

However, the circumstances of Isaacson’s change in job responsibilities simply

were not significant enough to have warranted an average, reasonable employee to

altogether quit employment. First, Isaacson not only retained the same salary, but also

maintained the same benefits package, job title, and job classification within WellPoint.

Also, as found by the ULJ and supported by the record, Isaacson’s “new” duties were

consistent with her responsibilities prior to the restructuring of her position. Essentially,

the only adverse effect suffered by Isaacson was her loss of “responsibility and visibility

8 within the organization” when she was stripped of her higher-level strategic planning

functions and access to senior management.

Isaacson argues that this “demotion” constituted good cause to quit by relying on

two cases in which employees were deemed to have good cause to quit: Marty v. Digital

Equip. Corp., 345 N.W.2d 773 (Minn. 1984), and Holbrook v. Minn. Museum of Art, 405

N.W.2d 537 (Minn. App. 1987), review denied (Minn. July 15, 1987). In Marty, the

employee was deemed eligible for unemployment benefits when she was terminated and

then offered a new position in the company that, while having the same initial salary, had

a lower maximum potential salary and required substantially less skill than her prior

position because the new position involved mostly clerical work. See 345 N.W.2d at

774–75. Similarly, in Holbrook, an assistant museum curator had good reason to quit

when her position was eliminated and she was then offered two half-time positions

involving primarily clerical work for which she was “clearly overqualified,” despite the

fact that her pay would not be reduced. See 405 N.W.2d at 538–39.

Based on this caselaw, Isaacson is correct that the lack of change in her salary, by

itself, is not determinative of whether an average, reasonable employee would have been

compelled to quit in her situation. However, the facts of these two cases are otherwise

distinguishable from the circumstances here. In both Marty and Holbrook, employees

were removed from positions that involved work suitable to their qualifications—human

resources tasks in Marty and art research and documentation in Holbrook—and then

offered replacement jobs that were primarily clerical in nature. Marty, 345 N.W.2d at

774–75; Holbrook, 405 N.W.2d at 538. In each case, the employee had “a right to reject,

9 without loss of benefits, a job which require[d] substantially less skill” than the employee

possessed. Holbrook, 405 N.W. 2d at 538 (quoting Marty, 345 N.W.2d at 775). Here,

Isaacson was not wholly stripped of the substance of her position and relegated to clerical

work; rather, her job became more narrowly focused on designing insurance products,

consistent with much of the work she had previously performed at WellPoint and with

other past employers. “[T]he extent of the change of job duties” in this case is simply not

as extensive as the reassignments in Marty or Holbrook. See Cook, 541 N.W.2d at 369,

Isaacson further argues that this court should recognize that “demotion” is

“universally recognized” as detrimental to her future career prospects, and that to require

her to produce specific evidence of such detriment would be inconsistent with the

unemployment-benefit scheme and caselaw. Under Cook, we are to consider “reasonable

career expectancies of the employee” and “the employee’s remaining chances for

advancement after the demotion” in evaluating whether good cause exists. 541 N.W.2d

at 369.

However, neither Marty nor Holbrook relied on abstractions of future detriment in

concluding that good cause to quit existed; rather, the record produced in both of those

cases showed that the replacement positions offered to those relators entailed a significant

reduction in salary potential from their prior positions. See Marty, 345 N.W.2d at 775

(“[T]he difference in salary potential between the two positions was 10.6%.”); Holbrook,

405 N.W.2d at 539 (“[T]here was evidence that the pay scales for [the new] positions

were lower than the pay scale for her assistant curator position.”). Here, Isaacson did not

raise such concrete concerns about her salary potential. Isaacson testified that her rate of

10 pay did not change and that she was unsure whether her eligibility for performance

bonuses was affected.

Isaacson’s concerns about the advancement of her career are similarly tenuous. At

the hearing in this case, Isaacson claimed that the fact that she no longer regularly met

with senior management at WellPoint “diminished” her role such that “get[ting] an equal

position outside of WellPoint [would be] very challenging.” But, the ULJ found that this

claim was “not credible because it constitutes only speculation,” as she offered “no

specific evidence . . . to show the alleged negative impact” of the shift in her job

responsibilities upon her career prospects. Our review of the record substantiates the

ULJ’s findings. Coupled with the fact that her job duties were not extensively changed,

these concerns, while valid, do not rise to a level that “would compel the average,

reasonable worker to quit.” Minn. Stat. § 268.095, subd. 3(a)(3).

We conclude that Isaacson lacked good reason to quit because an average,

reasonable employee under these circumstances would not have quit and become

unemployed.

Affirmed.