IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
RACHEL M. GOTTSCHALK, No. 86026-7-I
Appellant, DIVISION ONE v.
EMPLOYMENT SECURITY UNPUBLISHED OPINION DEPARTMENT,
Respondent.
SMITH, C.J. — Rachel Gottschalk appeals the Employment Security
Department’s (ESD) determination that she was overpaid unemployment benefits
between August 2, 2020 and September 4, 2021. Gottschalk fails to
demonstrate that ESD’s commissioner erred or that she is entitled to relief.
Accordingly, we affirm.
FACTS
Gottschalk was previously employed as a full-time outside salesperson for
Food Services of America (FSA), where she was paid on a one hundred percent
commission basis. In February 2020, Gottschalk gave birth to her third child.
While Gottschalk was on leave, the COVID-19 pandemic struck Washington.
Gottschalk was originally scheduled to return to work on or about August 3, 2020.
However, Gottschalk’s position required in-person visits with customer
businesses, which she could not perform as a person at “high-risk” for
COVID-19. Gottschalk was also the primary caregiver for her three children, two No. 86026-7-I/2
of which were engaged in remote learning. FSA placed Gottschalk on “COVID
leave,” which allowed her to remain employed, retain her benefits, and receive
what her employer deemed “COVID pay” of $1600 approximately every two
weeks. FSA encouraged Gottschalk to apply for unemployment benefits in order
to supplement the benefits it provided.
Gottschalk applied for unemployment benefits in August 2020. On or
about October 1, 2020, Gottschalk spoke to a customer service representative at
ESD about how she should answer the question about whether she was able and
available to work. The representative gave Gottschalk general guidance but was
not able to provide a definitive answer.
Gottschalk continued to seek assistance from ESD on how to file her claim
correctly. In December 2020, Gottschalk spoke to another customer service
agent, who encouraged Gottschalk to say she was able and available to telework
even though Gottschalk explained that she could not telework “because I have
an infant who I can’t put in daycare.” The same representative also encouraged
Gottschalk to indicate that she was laid off due to lack of work when FSA was
bought by US Foods.
In February 2021, US Foods contacted Gottschalk about returning to work
in a similar, but not identical, position. Although the pandemic was ongoing,
US Foods would still require Gottschalk to make in-person visits to customers.
US Foods did not offer any accommodations and informed Gottschalk that she
could either return under the terms it dictated or submit her resignation. Because
Gottschalk was still considered high-risk for COVID-19, she chose to resign.
2 No. 86026-7-I/3
ESD did not ask Gottschalk whether she had left employment until it contacted
her in September 2021.
On December 8, 2021, ESD issued a written determination letter denying
Gottschalk unemployment benefits as of February 21, 2021, on the basis that
she quit her job without good cause. On December 22, 2021, ESD issued two
written determination letters denying Gottschalk unemployment benefits from
August 2, 2020 through December 5, 2020 and from December 6, 2020 through
April 3, 2021, on the basis that she failed to report earnings or hours worked.
ESD demanded that Gottschalk repay benefits she received and asserted that it
would not waive the repayment obligation due to fraud.
Gottschalk appealed all three determination letters. All three appeals
were adjudicated at a single administrative hearing. Neither ESD nor US Foods
appeared at the hearing. At the hearing, the administrative law judge (ALJ)
asked Gottschalk how she would have managed telework during times when her
older children were attending remote school. Gottschalk answered that she did
not know. The ALJ also asked Gottschalk why she did not report receiving
“COVID pay,” to which she responded that an ESD representative informed her
that it was considered a bonus and was not deductible from unemployment
benefits.
The ALJ determined that Gottschalk did not voluntarily quit her job and
was instead laid off because of a lack of work. However, the ALJ also
determined that Gottschalk was not able and available to work because she was
caring for an infant and supervising two other children who were attending
3 No. 86026-7-I/4
remote school, and therefore was not eligible for unemployment benefits under
RCW 50.20.010(1)(c). The ALJ determined that Gottschalk was not at fault for
the overpayment of benefits because she was diligent in trying to comply but was
misguided by ESD employees. Because Gottschalk was not at fault, the ALJ
remanded the matter to ESD to determine whether her repayment obligation
should be waived.
Gottschalk appealed the ALJ’s rulings to the ESD commissioner. In two
separate decisions – one concerning Gottschalk’s benefit eligibility while she
remained employed and the other concerning her eligibility post-separation – the
commissioner affirmed the rulings and adopted the ALJ’s findings and
conclusions. The commissioner further determined that Gottschalk may be
eligible for pandemic unemployment assistance (PUA) benefits but that the ALJ
had no jurisdiction over the issue. The commissioner vacated the ALJ’s rulings
to the extent that they purported to determine Gottschalk’s eligibility for PUA
benefits and remanded the matter to ESD to determine whether her repayment
obligation should be waived.
Gottschalk appealed to superior court, and the superior court transferred
the matter to the Court of Appeals for direct review over Gottschalk’s objection.
ANALYSIS
The Washington Administrative Procedure Act (APA), chapter 34.05
RCW, governs judicial review of a final agency action. Tapper v. Emp. Sec.
Dep’t, 122 Wn.2d 397, 402, 858 P.2d 494 (1993); see RCW 34.05.570. “[T]his
court sits in the same position as the superior court, applying the standards of the
4 No. 86026-7-I/5
WAPA directly to the record before the agency.” Tapper, 122 Wn.2d at 402. We
review the decision of the commissioner, except to the extent that the
commissioner adopts the ALJ’s findings of fact and conclusions of law. Cuesta v.
Emp. Sec. Dep’t, 200 Wn. App. 560, 569, 402 P.3d 898 (2017). As the party
challenging the agency action, Gottschalk bears the burden of demonstrating the
invalidity of the agency's decision. RCW 34.05.570(1)(a).
We review findings of fact to determine whether they are supported by
substantial evidence. Barker v. Emp. Sec. Dep’t, 127 Wn. App. 588, 592, 112
P.3d 536 (2005). Substantial evidence means that it is “sufficient . . . to
persuade a reasonable person of the truth of the declared premise.” Barker, 127
Wn. App. at 592. We treat unchallenged findings of fact as verities on appeal
and will not make witness credibility determinations.
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IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
RACHEL M. GOTTSCHALK, No. 86026-7-I
Appellant, DIVISION ONE v.
EMPLOYMENT SECURITY UNPUBLISHED OPINION DEPARTMENT,
Respondent.
SMITH, C.J. — Rachel Gottschalk appeals the Employment Security
Department’s (ESD) determination that she was overpaid unemployment benefits
between August 2, 2020 and September 4, 2021. Gottschalk fails to
demonstrate that ESD’s commissioner erred or that she is entitled to relief.
Accordingly, we affirm.
FACTS
Gottschalk was previously employed as a full-time outside salesperson for
Food Services of America (FSA), where she was paid on a one hundred percent
commission basis. In February 2020, Gottschalk gave birth to her third child.
While Gottschalk was on leave, the COVID-19 pandemic struck Washington.
Gottschalk was originally scheduled to return to work on or about August 3, 2020.
However, Gottschalk’s position required in-person visits with customer
businesses, which she could not perform as a person at “high-risk” for
COVID-19. Gottschalk was also the primary caregiver for her three children, two No. 86026-7-I/2
of which were engaged in remote learning. FSA placed Gottschalk on “COVID
leave,” which allowed her to remain employed, retain her benefits, and receive
what her employer deemed “COVID pay” of $1600 approximately every two
weeks. FSA encouraged Gottschalk to apply for unemployment benefits in order
to supplement the benefits it provided.
Gottschalk applied for unemployment benefits in August 2020. On or
about October 1, 2020, Gottschalk spoke to a customer service representative at
ESD about how she should answer the question about whether she was able and
available to work. The representative gave Gottschalk general guidance but was
not able to provide a definitive answer.
Gottschalk continued to seek assistance from ESD on how to file her claim
correctly. In December 2020, Gottschalk spoke to another customer service
agent, who encouraged Gottschalk to say she was able and available to telework
even though Gottschalk explained that she could not telework “because I have
an infant who I can’t put in daycare.” The same representative also encouraged
Gottschalk to indicate that she was laid off due to lack of work when FSA was
bought by US Foods.
In February 2021, US Foods contacted Gottschalk about returning to work
in a similar, but not identical, position. Although the pandemic was ongoing,
US Foods would still require Gottschalk to make in-person visits to customers.
US Foods did not offer any accommodations and informed Gottschalk that she
could either return under the terms it dictated or submit her resignation. Because
Gottschalk was still considered high-risk for COVID-19, she chose to resign.
2 No. 86026-7-I/3
ESD did not ask Gottschalk whether she had left employment until it contacted
her in September 2021.
On December 8, 2021, ESD issued a written determination letter denying
Gottschalk unemployment benefits as of February 21, 2021, on the basis that
she quit her job without good cause. On December 22, 2021, ESD issued two
written determination letters denying Gottschalk unemployment benefits from
August 2, 2020 through December 5, 2020 and from December 6, 2020 through
April 3, 2021, on the basis that she failed to report earnings or hours worked.
ESD demanded that Gottschalk repay benefits she received and asserted that it
would not waive the repayment obligation due to fraud.
Gottschalk appealed all three determination letters. All three appeals
were adjudicated at a single administrative hearing. Neither ESD nor US Foods
appeared at the hearing. At the hearing, the administrative law judge (ALJ)
asked Gottschalk how she would have managed telework during times when her
older children were attending remote school. Gottschalk answered that she did
not know. The ALJ also asked Gottschalk why she did not report receiving
“COVID pay,” to which she responded that an ESD representative informed her
that it was considered a bonus and was not deductible from unemployment
benefits.
The ALJ determined that Gottschalk did not voluntarily quit her job and
was instead laid off because of a lack of work. However, the ALJ also
determined that Gottschalk was not able and available to work because she was
caring for an infant and supervising two other children who were attending
3 No. 86026-7-I/4
remote school, and therefore was not eligible for unemployment benefits under
RCW 50.20.010(1)(c). The ALJ determined that Gottschalk was not at fault for
the overpayment of benefits because she was diligent in trying to comply but was
misguided by ESD employees. Because Gottschalk was not at fault, the ALJ
remanded the matter to ESD to determine whether her repayment obligation
should be waived.
Gottschalk appealed the ALJ’s rulings to the ESD commissioner. In two
separate decisions – one concerning Gottschalk’s benefit eligibility while she
remained employed and the other concerning her eligibility post-separation – the
commissioner affirmed the rulings and adopted the ALJ’s findings and
conclusions. The commissioner further determined that Gottschalk may be
eligible for pandemic unemployment assistance (PUA) benefits but that the ALJ
had no jurisdiction over the issue. The commissioner vacated the ALJ’s rulings
to the extent that they purported to determine Gottschalk’s eligibility for PUA
benefits and remanded the matter to ESD to determine whether her repayment
obligation should be waived.
Gottschalk appealed to superior court, and the superior court transferred
the matter to the Court of Appeals for direct review over Gottschalk’s objection.
ANALYSIS
The Washington Administrative Procedure Act (APA), chapter 34.05
RCW, governs judicial review of a final agency action. Tapper v. Emp. Sec.
Dep’t, 122 Wn.2d 397, 402, 858 P.2d 494 (1993); see RCW 34.05.570. “[T]his
court sits in the same position as the superior court, applying the standards of the
4 No. 86026-7-I/5
WAPA directly to the record before the agency.” Tapper, 122 Wn.2d at 402. We
review the decision of the commissioner, except to the extent that the
commissioner adopts the ALJ’s findings of fact and conclusions of law. Cuesta v.
Emp. Sec. Dep’t, 200 Wn. App. 560, 569, 402 P.3d 898 (2017). As the party
challenging the agency action, Gottschalk bears the burden of demonstrating the
invalidity of the agency's decision. RCW 34.05.570(1)(a).
We review findings of fact to determine whether they are supported by
substantial evidence. Barker v. Emp. Sec. Dep’t, 127 Wn. App. 588, 592, 112
P.3d 536 (2005). Substantial evidence means that it is “sufficient . . . to
persuade a reasonable person of the truth of the declared premise.” Barker, 127
Wn. App. at 592. We treat unchallenged findings of fact as verities on appeal
and will not make witness credibility determinations. Tapper, 122 Wn.2d at 407;
US W. Commc’ns, Inc. v. Utils. & Transp. Comm’n, 134 Wn.2d 48, 62, 949 P.2d
1321 (1997).
Eligibility for Unemployment Benefits
RCW 50.20.010(1)(c) states that an individual is only eligible to receive
unemployment benefits if that person is “able to work, and is available for work in
any trade, occupation, profession, or business for which the individual is
reasonably fitted.” To be available for work, the individual “must be ready, able,
and willing, immediately to accept any suitable work which may be offered to him
or her and must be actively seeking work.” RCW 50.20.010(1)(c)(i). Between
February 29, 2020 and June 30, 2021, individuals were not required to accept in-
person work but only needed to be able and available to accept suitable
5 No. 86026-7-I/6
telework. RCW 50.20.010(1)(c)(ii). Additionally, the job search requirement was
waived during the COVID pandemic. Proclamation of Governor Jay Inslee,
No. 20-30 (Wash. Mar. 25, 2020), https://www.governor.wa.gov/sites/default/files/
proclamations/20-30%20COVID-19%20-%20ESD-Job%20Requirements%20%
28tmp%29.pdf [https://perma.cc/HT9J-45B7].
Here, the commissioner determined that Gottschalk was not eligible for
unemployment benefits because she was not ready, able, and willing to accept
telework between August 2, 2020 and September 4, 2021. The commissioner
reached this conclusion based on Gottschalk’s testimony that she “was the
primary caregiver for three children, two of which were remote learning,” and that
she did not know how she would manage telework alongside her childcare
responsibilities.
Although Gottschalk assigned error to all of the commissioner’s findings of
fact, she does not explain how the findings are not supported by substantial
evidence. Instead, she asserts that the commissioner’s decisions were in error
due to various procedural irregularities. None of those arguments have merit.
First, Gottschalk asserts that the commissioner erred by issuing two
decisions instead of one. She cites no authority that would require the
commissioner to issue a single decision, even when multiple ALJ orders were
issued. Even if the commissioner erred in issuing two decisions, Gottschalk
suffered no prejudice, as she obtained judicial review of both decisions in this
appeal. Similarly, Gottschalk fails to articulate any prejudice in the
commissioner’s decision to remand for ESD to determine whether to waive her
6 No. 86026-7-I/7
repayment obligation. Without demonstrating that she suffered prejudice,
Gottschalk is not entitled to relief. RCW 34.05.570(1)(d) (“The court shall grant
relief only if it determines that a person seeking judicial relief has been
substantially prejudiced by the action complained of.”).
Next, Gottschalk asserts that she was receiving PUA benefits until ESD
“unlawfully switched her claim from a federal claim to a state claim.” Gottschalk
does not identify any actual evidence to support her contention that ESD
“unlawfully switched” her federal PUA claim to a state unemployment claim. The
only evidence Gottschalk cites in her opening brief are the applications she
submitted which provided an estimate of the benefits she could be eligible to
receive. This is not sufficient for Gottschalk to satisfy her burden of
demonstrating that the commissioner’s decisions were invalid.
Gottschalk further argues that the commissioner erred by not addressing
her entitlement to PUA benefits. An administrative law judge adjudicating
unemployment benefits only has the power to decide the matters set forth in the
appealed determination letter. RCW 50.32.010, .040(1). All three of the
determination letters appealed by Gottschalk concerned her entitlement to state
unemployment benefits. Only one of those letters mentions PUA benefits and
states only that the denial of unemployment benefits would affect her PUA claim.
That Gottschalk’s PUA claim would be affected was necessarily true because, as
the State notes, claimants were not eligible for PUA benefits unless they were
ineligible for regular state unemployment benefits. Coronavirus Aid, Relief, and
Economic Security (CARES) Act, Pub. L. No. 116-136, 134 Stat. 281,
7 No. 86026-7-I/8
§ 2102(a)(3)(A)(i) (2020) (codified as amended at 15 U.S.C. § 9021). Nothing in
the record demonstrates the ESD ever determined that she was ineligible for
PUA benefits. Accordingly, the commissioner was correct that neither he nor the
ALJ had the authority to rule on Gottschalk’s entitlement to PUA benefits.
Gottschalk also argues that the commissioner “raised new arguments in
the final decisions.” Specifically, Gottschalk contends that the commissioner sua
sponte raised the issue of whether she was unemployed.1 Gottschalk is both
factually and legally incorrect.
Factually, Gottschalk is incorrect because she received notice that the ALJ
would consider “[w]hether the claimant was able to, available for, and actively
seeking work” prior to the administrative hearing. At the hearing itself, the ALJ
questioned Gottschalk about her readiness and ability to accept work.
Gottschalk’s counsel did not object to this line of questioning.
Legally, the question before the commissioner was whether Gottschalk
was entitled to unemployment benefits. RCW 50.32.040(1) states: A dispute of an individual's initial determination, determination of allowance or denial of allowance of benefits, or redetermination of allowance or denial of benefits, all matters covered by such initial determination, determination, or redetermination shall be deemed to be in issue irrespective of the particular ground or grounds set forth in the notice of appeal.
As our Supreme Court explained, this statute grants the ALJ the authority “not
only to consider the testimony respecting the particular disqualification previously
found by the official representative of the department, but also to inquire whether
1 Gottschalk also argues that the commissioner raised “new unsworn, uncross-examined evidence,” but does not identify what this evidence is.
8 No. 86026-7-I/9
appellant was in all respects eligible to receive benefits under the act.” Jacobs v.
Office of Unemployment Comp. & Placement, 27 Wn.2d 641, 650, 179 P.2d 707
(1947). Gottschalk’s eligibility for unemployment benefits having been placed at
issue, the commissioner was statutorily authorized to decide whether Gottschalk
was ready, able, and willing to accept telework.
Finally, Gottschalk argues that the ESD’s determination letters were
untimely issued.2 Gottschalk did not make this argument at the administrative
hearing or in her appeal to the commissioner. RCW 34.05.554(1) states that
“[i]ssues not raised before the agency may not be raised on appeal” in a
proceeding under the administrative procedures act, subject to certain
exceptions. Gottschalk has not shown that any of the enumerated exceptions
apply in this case. We decline to address this argument further.3
Fees on Appeal
Gottschalk requests an award of fees on appeal pursuant to RAP 18.1,
RCW 50.32.160, and RCW 4.84.350. RAP 18.1 provides that applicable law
may grant a party the right to recover reasonable attorney fees or expenses on
2 Gottschalk also contends that the commissioner should not have ruled that she was subject to an earnings deduction from unemployment benefits due to the “COVID pay” she received from her employer. Because the commissioner determined that Gottschalk was not entitled to any unemployment benefits, this issue is moot and we decline to address it. 3 Gottschalk makes numerous other assignments of error that she fails to address in the argument section of her brief. “We generally do not consider assignments of error unsupported by argument and citations to the record.” Shelcon Constr. Grp., LLC v. Haymond, 187 Wn. App. 878, 889, 351 P.3d 895 (2015) (citing Seattle Sch. Dist. No. 1 v. State, 90 Wn.2d 476, 496, 585 P.2d 71 (1978)).
9 No. 86026-7-I/10
review. RCW 50.32.160 states that “if the decision of the commissioner shall be
reversed or modified, such [attorney] fee and the costs shall be payable out of
the unemployment compensation administration fund.” Because we do not
reverse or modify the commissioner’s decision, Gottschalk is not entitled to fees
under this statute.
RCW 4.84.350(1) provides that “[e]xcept as otherwise specifically
provided by statute, a court shall award a qualified party that prevails in a judicial
review of an agency action fees and other expenses, including reasonable
attorneys’ fees.” As ESD correctly points out, “RCW 4.84.350 does not apply to
claims under the Employment Security Act because the Act has its own attorney
fees statute.” Hall v. Emp. Sec. Dep’t, 4 Wn. App. 2d 648, 655, 423 P.3d 278
(2018). Gottschalk is not entitled to fees in this appeal.
We affirm.
WE CONCUR: