Soderquist v. Universal Services Telecom Tech Inc.

774 N.W.2d 729, 2009 Minn. App. LEXIS 202, 2009 WL 3735926
Court of Appeals of Minnesota·Decided November 10, 2009·No. A09-202·Published

Opinion

OPINION

KLAPHAKE, Judge.

An unemployment law judge (ULJ) determined that relator Michelle Soderquist was ineligible to receive unemployment benefits under Minn.Stat. § 268.085, subd. 9, because her employer, respondent Universal Services Telecom Tech Inc. (Universal Services), was owned by relator’s daughter, and relator did not qualify to receive benefits until she was paid a threshold amount in each of the 16 quarters preceding her discharge. We affirm.

FACTS

In this unemployment benefits case, the essential facts are not in dispute. Relator worked for Universal Services from April 24, 2004 to September 22, 2008. Relator worked full time as a technical service route manager, but she was discharged from her job when the bulk of her work was taken over by a client. Universal Services is fully owned by relator’s daughter and son-in-law.

Contemporaneously with her discharge, 1 relator established an unemployment account and applied for benefits. Her weekly benefit amount was set at $465. Relying on Minn.Stat. § 268.085, subd. 9 (Supp.2007), respondent Department of Employment and Economic Development (department) initially determined that her wages could not be used for unemployment benefits because she was a family member of a business owner, was paid at least four times her weekly benefit, and was only temporarily unemployed in the business.

Upon relator’s appeal to the ULJ, a telephone hearing was held, and Universal Services submitted evidence of relator’s pay records. The ULJ also denied relator benefits, applying the 2008 version of Minn.Stat. § 268.085, subd. 9, which prohibits an applicant who works for a “family” business and has been paid five times here weekly benefit from being eligible to receive benefits unless “the applicant had wages paid of $7,500 or more ... in each of the 16 calendar quarters prior to the effective date of the benefit account.” Relator received the following wages for the 16 calendar quarters prior to being discharged:

[[Image here]]

Relator argued to the ULJ that in determining the pay she received during 16 quarters, her total wages should be averaged to compute her quarterly pay. Relator also argued that the apparent purpose of the statute was to “ensure a benchmark of earnings ... for the employee who happens to have a familial relationship with the employer,” and that she clearly met that requirement. The ULJ rejected relator’s arguments because it found that the *731 statute clearly set forth the proper method for computing relator’s wages and that its application prohibited relator from receiving benefits. The ULJ ruled that, consistent with the statute, relator necessarily had to receive pay of $7,500 for “each” of the 16 quarters in order to reach the pay threshold for receiving benefits. The ULJ’s decision notes, however, that it was “unlikely that the Legislature intended to limit benefits for employees like [relator] when it passed” the statute.

Relator sought reconsideration of the ULJ’s decision, and the ULJ affirmed. The ULJ again rejected relator’s request to average her wages over 16 quarters, noting that computing her average wages to arrive at the quarterly amount “is not the approach that is required by the statute,” which sets forth a “clear criteria for determining when an applicant is exempt from the provisions of Minn.Stat. § 268.085, subd. 9.”

Relator appealed by writ of certiorari to this court.

ISSUE

Did the ULJ err in interpreting Minn. Stat. § 268.085, subd. 9, to prohibit relator from receiving unemployment benefits because she did not satisfy the minimum pay requirements set forth in the statute?

ANALYSIS

This court reviews a ULJ’s decision to determine whether a party’s substantial rights were prejudiced and may alter the decision only if, among other reasons, the decision is affected by an “error of law.” Minn.Stat. § 268.105, subd. 7(d) (2008). The interpretation of a statute on undisputed facts is a question of law subject to de novo review. Reider v. Anoka-Hennepin Sch. Dist. No. 11, 728 N.W.2d 246, 249 (Minn.2007). In unemployment benefits cases, this court applies the statute in effect at the time of the employee’s discharge. Brown v. Nat’l Am. Univ., 686 N.W.2d 329, 332 (Minn.App.2004).

Minn.Stat. § 268.085 (2008) sets forth the eligibility requirements for receiving unemployment benefits, and subdivision 9 limits the eligibility of applicants who are related to owners of the business that employed them, as follows:

Wage credits from an employer may not be used for unemployment benefit purposes by any applicant who:
[[Image here]]
(2) is the spouse, parent, or minor child of any individual who owns or controls directly or indirectly 25 percent or more interest in the employer.
This subdivision is effective when the applicant has been paid five times the applicant’s weekly unemployment benefit amount in the current benefit year. This subdivision does not apply if the applicant had wages paid of $7,500 or more from the employer covered by this subdivision in each of the 16 calendar quarters prior to the effective date of the benefit account.

(Emphasis added.) The previous version of the statute prohibited an individual from receiving benefits if the individual was the parent of a business owner and was “temporarily, seasonally, or indefinitely unemployed and not permanently separated from the employment.” Minn.Stat. § 268.085, subd. 9 (Supp.2007). The 2008 version of the statute became effective on July 6, 2008, and it applies to “applications for unemployment benefits filed on or after that date.” 2008 Minn. Laws ch. 300, § 13, at 1132. Because relator applied for benefits in September 2008, the 2008 version of the statute controls here.

Free access — add to your briefcase to read the full text and ask questions with AI

Soderquist v. Universal Services Telecom Tech Inc., 774 N.W.2d 729, 2009 Minn. App. LEXIS 202, 2009 WL 3735926 (Mich. Ct. App. 2009).

774 N.W.2d 729 (Soderquist v. Universal Services Telecom Tech Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

State v. Anderson
683 N.W.2d 818 (Supreme Court of Minnesota, 2004)
Reider v. Anoka-Hennepin School District No. 11
728 N.W.2d 246 (Supreme Court of Minnesota, 2007)
Brown v. National American University
686 N.W.2d 329 (Court of Appeals of Minnesota, 2004)
Amaral v. Saint Cloud Hospital
598 N.W.2d 379 (Supreme Court of Minnesota, 1999)
American Tower, L.P. v. City of Grant
636 N.W.2d 309 (Supreme Court of Minnesota, 2001)