Pierce v. Wayne Solutions Inc.

2011 Ohio 2324

• Court: Ohio Court of Appeals
• Decided: May 16, 2011
• Docket: 10CA0026
• Status: Published

Opinion

[Cite as Pierce v. Wayne Solutions Inc., 2011-Ohio-2324.]

STATE OF OHIO ) IN THE COURT OF APPEALS )ss: NINTH JUDICIAL DISTRICT COUNTY OF WAYNE )

GARY D. PIERCE C.A. No. 10CA0026

Appellant

v. APPEAL FROM JUDGMENT ENTERED IN THE WAYNE SOLUTIONS, INC., et al. COURT OF COMMON PLEAS COUNTY OF WAYNE, OHIO Appellees CASE No. 09-CV-0924

DECISION AND JOURNAL ENTRY

Dated: May 16, 2011

DICKINSON, Judge.

INTRODUCTION

{¶1} The Will-Burt Company laid Gary Pierce off after he had worked for it from June

2008 until February 2009. The Unemployment Compensation Review Commission denied Mr.

Pierce benefits because, up until two weeks before the layoff, he had been paid through a staffing

company. According to the Commission, because Mr. Pierce quit his job at the staffing company

so Will-Burt could hire him directly, he was not eligible for benefits. Mr. Pierce appealed, but

the common pleas court affirmed the Commission’s decision. We reverse because the

Commission’s just cause determination was unreasonable under the undisputed facts of this case

and in light of the purpose of the Unemployment Compensation Act.

BACKGROUND

{¶2} Mr. Pierce is an industrial engineer who was interested in working for Will-Burt.

When he asked Will-Burt about employment, it told him that, although it needed someone with 2

his skills, it only hired people through a staffing agency called Wayne Solutions Inc. Wayne

Solutions subsequently hired Mr. Pierce and placed him with Will-Burt.

{¶3} Under Will-Burt’s and Wayne Solutions’ contract, Will-Burt could not directly

hire anyone that Wayne Solutions placed with it until the worker had worked for it for 90 days.

In February 2009, Mr. Pierce’s boss at Will-Burt asked him if he would like to work for Will-

Burt directly. According to Mr. Pierce, his boss told him that Will-Burt would handle the

transition for him. Mr. Pierce testified that, after he was directly hired by Will-Burt, his duties

remained the same as before the switch.

{¶4} Ten days after Mr. Pierce began working directly for Will-Burt, Will-Burt laid off

a number of its employees, including Mr. Pierce, because it suffered a “significant, abrupt drop”

in its sales. Mr. Pierce testified that, because his position was eliminated, he would have lost his

job at Will-Burt even if he had still been getting paid by Wayne Solutions.

{¶5} Mr. Pierce applied, and was initially approved, for unemployment benefits. The

Department of Job and Family Services reconsidered its decision, however, when it realized that

Mr. Pierce had not directly worked for Will-Burt for three weeks before his layoff. Mr. Pierce

appealed to the Commission, but it affirmed, finding that he had voluntarily quit his position at

Wayne Solutions without just cause to accept direct employment from Will-Burt.

{¶6} Wayne Solutions’ benefits manager testified that a lot of its employees accept

employment directly from its clients after they have worked for the client for a certain period of

time. Regarding Mr. Pierce’s separation from Wayne Solutions, she said that his employment

record contains a note saying, “Assignment ended because he was hired in.” She testified that,

at the time Mr. Pierce went to work for Will-Burt, she had no reason to think that he would not

qualify for unemployment benefits. There is also a letter in the record from Will-Burt explaining 3

that, if it had known that Mr. Pierce was one day short of qualifying for unemployment benefits,

it would have continued his employment so that he could have met the criteria.

QUIT WITHOUT JUST CAUSE

{¶7} Mr. Pierce’s assignment of error is that the common pleas court incorrectly

determined that he quit without just cause from Wayne Solutions for purposes of unemployment

benefits. Courts review a decision of the Unemployment Compensation Review Commission

under Section 4141.28.2 of the Ohio Revised Code. The common pleas court must affirm the

Commission’s decision unless it was unlawful, unreasonable, or against the manifest weight of

the evidence. R.C. 4141.28.2(H). We apply the same standard on appeal, focusing on the

decision of the Commission instead of the common pleas court’s decision. Univ. of Akron v.

Ohio Dep’t of Job and Family Servs., 9th Dist. No. 24566, 2009-Ohio-3172, at ¶9; see Tzangas,

Plakas & Mannos v. Ohio Bureau of Emp. Servs., 73 Ohio St. 3d 694, paragraph one of the

syllabus (1995).

{¶8} Under Section 4141.29(A) of the Ohio Revised Code, an individual is eligible for

unemployment benefits if (1) he has filed a valid application for determination of benefit rights

under Section 4141.28, (2) he has made a claim for benefits under Section 4141.28, (3) he has

registered at an unemployment office, (4) he is able to work and is available for and actively

seeking suitable work, (5) he is unable to obtain suitable work, and (6) he participates in

reemployment services. An application for determination of benefit rights under Section

4141.28 is valid if “the individual filing such application is unemployed, has been employed by

an employer or employers subject to this chapter in at least twenty qualifying weeks within the

individual’s base period, and has earned or been paid remuneration at an average weekly wage of 4

not less than twenty-seven and one-half per cent of the statewide average weekly wage for such

weeks.” R.C. 4141.01(R)(1).

{¶9} Even if an individual meets Section 4141.29(A)’s eligibility requirements, he is

ineligible for unemployment benefits if he “quit work without just cause or has been discharged

for just cause in connection with [his] work[.]” R.C. 4141.29(D)(2)(a). But see R.C.

4141.29.1(A)(2), (3) (providing that an individual is not disqualified under Section

4141.29(D)(2)(a) if he begins a new job within seven days and works for the new employer for

three weeks). At first glance, the plain language of Section 4141.29(D)(2)(a) suggests that the

“quit work . . . or has been discharged” determination refers to the circumstances that led to the

individual’s present lack of employment. The section has been construed to apply, however, to

any job that the individual had during his “[b]enefit year.” R.C. 4141.01(R)(1); Radcliffe v.

Artromick Int’l Inc., 31 Ohio St. 3d 40 (1987). For example, in Radcliffe, Betty Radcliffe quit a

job that she had held for six months to accept a higher paying position at Artromick. Because of

a personality conflict with her new supervisor, Artromick discharged her after only eight days

without just cause. Instead of only examining whether Ms. Radcliffe was ineligible for

unemployment benefits under Section 4141.29(D)(2)(a) based on the reason for her separation

from Artromick, the Ohio Supreme Court looked back to the fact that she had voluntarily quit

her job at the former employer. Id. at 41 (“Radcliffe voluntarily quit her work . . . to accept a

better paying job. She thereby quit work without just cause and became disqualified from

receiving unemployment benefits [under] R.C. 4141.29(D)(2)(a).”). Because Ms. Radcliffe had

quit the previous job without just cause, the Supreme Court wrote that she was only eligible for

benefits if she was deemed to have worked for Artromick for three weeks. Id. at 41-42 (citing

R.C. 4141.29.1(A)). 5

{¶10} Similarly, even though Mr. Pierce was laid off from Will-Burt without just cause,

that does not end our inquiry under Section 4141.29(D)(2)(a). Because Mr. Pierce worked for

Wayne Solutions within the year before he applied for benefits, we must also consider whether

he quit Wayne Solutions without just cause. See R.C. 4141.01(Q)(1) (defining “[b]ase period”

as “the first four of the last five completed calendar quarters immediately preceding the first day

of an individual’s benefit year”). If he quit Wayne Solutions without just cause, then he is only

eligible for benefits if he meets the criteria listed in Section 4141.29.1. Radcliffe v. Artromick

Int’l Inc., 31 Ohio St. 3d 40, 43 (1987).

{¶11} Mr. Pierce has argued that it was unreasonable for the Commission to find that he

“quit work” under Section 4141.29(D)(2)(a) because he remained in the same job. We do not

reach this question because, even if Mr. Pierce quit his job at Wayne Solutions to be hired

directly by Will-Burt, he had just cause for doing so.

{¶12} The Ohio Supreme Court has written that there is no “slide-rule” definition of just

cause and that “each case must be considered upon its particular merits.” Irvine v. State

Unemployment Comp. Bd. of Review, 19 Ohio St. 3d 15, 17 (1985) (quoting Peyton v. Sun T.V.,

44 Ohio App. 2d 10, 12 (1975)). “Traditionally, just cause, in the statutory sense, is that which,

to an ordinarily intelligent person, is a justifiable reason for doing or not doing a particular act.”

Id. (quoting Peyton, 44 Ohio App. 2d at 12).

{¶13} The Ohio Supreme Court has also written that “[t]he determination of what

constitutes just cause must be analyzed in conjunction with the legislative purpose underlying the

Unemployment Compensation Act.” Irvine v. State Unemployment Comp. Bd. of Review, 19

Ohio St. 3d 15, 17 (1985). “Essentially, the Act’s purpose is ‘to enable unfortunate employees,

who become and remain involuntarily unemployed by adverse business and industrial conditions, 6

to subsist on a reasonably decent level and is in keeping with the humanitarian and enlightened

concepts of this modern day.’” Id. (quoting Leach v. Republic Steel Corp., 176 Ohio St. 221,

223 (1964)). “Likewise, ‘[t]he [A]ct was intended to provide financial assistance to an

individual who had worked, was able and willing to work, but was temporarily without

employment through no fault or agreement of his own.’” Id. (quoting Salzl v. Gibson Greeting

Cards Inc., 61 Ohio St. 2d 35, 39 (1980)). Acknowledging the purpose of the Act, the Ohio

Supreme Court has held that “[t]he protections of an employee under R.C. 4141.29 are to be

liberally construed [and] . . . the exceptions to R.C. 4141.29 should be narrowly construed.”

Lorain County Auditor v. Ohio Unemployment Comp. Review Comm’n, 113 Ohio St. 3d 124,

2007-Ohio-1247, at ¶31.

{¶14} Initially, we note that this is not a case in which an individual quit his job at one

employer to accept a better paying job from another company. Compare Radcliffe v. Artromick

Int’l Inc., 31 Ohio St. 3d 40, 41 (1987). Rather, it is undisputed that Mr. Pierce only ever worked

at Will-Burt, doing the exact same job regardless of whether he was getting paid through Wayne

Solutions or directly by Will-Burt. Furthermore, it was uncontested that Mr. Pierce had the

intention all along of working directly for Will-Burt, and that the only reason he contacted

Wayne Solutions was because Will-Burt told him that it did its hiring through that company.

{¶15} This case, therefore, is similar to Kubelka v. Bd. of Review, Ohio Bureau of

Employment Servs., 8th Dist. No. 38098, 1979 WL 209852 (Jan. 25, 1979). In Kubelka, the

United States Navy honorably discharged Mr. Kubelka in Florida due to a lack of work. He took

a job as a temporary laborer at a machining company so that he could earn enough money to

return to Ohio. After he returned to Ohio, he applied for unemployment benefits, but was denied

them because he had voluntarily quit the machining company. The Eighth District reversed, 7

noting that it was undisputed that both Mr. Kubelka and the machining company “knew that his

work would be for a short time only.” Id. at *3.

{¶16} According to Wayne Solutions’ benefit manager, it is common for Wayne

Solutions’ clients to hire its employees directly. She testified that the entire reason Wayne

Solutions has a 90-day waiting period built into its contracts with its clients is “because we don’t

want [our employees] to work three days and get hired in and we lose all our fees.”

{¶17} Mr. Pierce went to work for Wayne Solutions because it was the only way he

could eventually work directly for Will-Burt. That was an entirely “justifiable” thing for an

“ordinarily intelligent person” to do. Irvine v. Unemployment Comp. Bd. of Review, 19 Ohio St.

3d 15, 17 (1985) (quoting Peyton v. Sun T.V., 44 Ohio App. 2d 10, 12 (1975)). Wayne Solutions

is, admittedly, a temporary staffing company, who has had many of it employees “hired in” by

its clients. The contracts that Wayne Solutions negotiates with its clients contain explicit

provisions addressing that situation. Accordingly, construing Section 4141.29(D)(2)(a) liberally

in favor of Mr. Pierce, we conclude that it was unreasonable for the Commission to determine

that he quit Wayne Solutions without just cause.

{¶18} Unlike the Commission’s decision, our conclusion is consistent with the purpose

of the Unemployment Compensation Act. According to the Ohio Supreme Court, the Act exists

“to protect [workers] from economic forces over which they have no control.” Tzangas, Plakas

& Mannos v. Ohio Bureau of Employment Servs., 73 Ohio St. 3d 694, 697 (1995). Mr. Pierce

worked for Will-Burt from June 2008 to February 2009, when he was laid off because of a

significant, abrupt decline in demand for Will-Burt’s products. Thus, Mr. Pierce’s layoff was not

because of any fault of his own, but rather was because of economic forces over which he had no

control. See id.; Irvine v. Unemployment Comp. Bd. of Review, 19 Ohio St. 3d 15, 17 (1985). 8

The Commission’s determination that he is ineligible for benefits because he was paid by two

different companies, even though he was doing the exact same work, cannot be reconciled with

the purpose of the Act.

{¶19} The parties have submitted supplemental briefing regarding Smith v. Lindsay

Excavating & Concrete, 5th Dist. No. 2003CA00283, 2004-Ohio-986. In Smith, the staffing

company for which Mr. Smith worked placed him with Lindsay as a laborer. Mr. Smith left the

staffing company after 90 days to become a truck driver for Lindsay, but was discharged nine

days later because he was involved in a collision while driving Lindsay’s truck. The Fifth

District wrote that “there is no doubt that [Mr. Smith’s] quit from [the staffing company] to

accept employment with Lindsay was a quit without just cause.” Id. at ¶32. It rejected Mr.

Smith’s argument that he had been an employee of Lindsay while he was on the staffing

company’s payroll and that the Unemployment Compensation Act was unconstitutional as

applied to him. Id. at ¶50, 63.

{¶20} Smith is distinguishable because Mr. Smith left the staffing company to do a

different job than the one he had done while employed by the staffing company. In addition, Mr.

Smith, apparently, did not argue that he had just cause for leaving the staffing company.

Furthermore, the Fifth District did not mention the purpose of the Unemployment Compensation

Act in discussing its reasons for its decision. We, therefore, conclude that Smith is not

persuasive authority regarding the issues involved in this case. Mr. Pierce’s assignment of error

is sustained.

CONCLUSION

{¶21} The Commission unreasonably determined that Mr. Pierce quit Wayne Solutions

without just cause. The judgment of the Wayne County Common Pleas Court is reversed. 9

Judgment reversed, and cause remanded.

There were reasonable grounds for this appeal.

We order that a special mandate issue out of this Court, directing the Court of Common

Pleas, County of Wayne, State of Ohio, to carry this judgment into execution. A certified copy

of this journal entry shall constitute the mandate, pursuant to App.R. 27.

Immediately upon the filing hereof, this document shall constitute the journal entry of

judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the

period for review shall begin to run. App.R. 22(E). The Clerk of the Court of Appeals is

instructed to mail a notice of entry of this judgment to the parties and to make a notation of the

mailing in the docket, pursuant to App.R. 30.

Costs taxed to Appellees.

CLAIR E. DICKINSON FOR THE COURT

BELFANCE, P. J. MOORE, J. CONCUR

APPEARANCES:

MICHAEL A. CREVELING, Attorney at Law, for Appellant.

JOHN TARKOWSKY, Attorney at Law, for Appellees.

MICHAEL DEWINE, Ohio Attorney General, and LAUREL BLUM MAZOROW, Assistant Attorney General, for Appellees.