Wood v. Menard, Inc.

490 N.W.2d 441, 1992 Minn. App. LEXIS 1009, 1992 WL 276978
CourtCourt of Appeals of Minnesota
DecidedOctober 13, 1992
DocketCX-92-1047
StatusPublished
Cited by5 cases

This text of 490 N.W.2d 441 (Wood v. Menard, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wood v. Menard, Inc., 490 N.W.2d 441, 1992 Minn. App. LEXIS 1009, 1992 WL 276978 (Mich. Ct. App. 1992).

Opinion

OPINION

RANDALL, Judge.

Employer Menard, Inc. appeals the Commissioner’s representative’s decision that employee Pete O. Wood voluntarily terminated his employment with good cause attributable to his employer due to a substantial decrease in pay. We reverse and remand.

FACTS

Pete O. Wood was employed full time by Menard, Inc. beginning in May 1990. Originally, Wood was hired to work solely as a lumberyard worker, but was asked if he would like to drive the delivery trucks as well. Wood accepted the position and was paid an hourly wage of $6.30. Thereafter, Wood spent approximately half of his time in the lumberyard and the other half delivering merchandise to customers. However, there was no guarantee that Wood would make a certain number of deliveries during his employment with Menard.

In June 1992, Wood began receiving 15.5 cents per mile, plus additional sums for stops and handling when making deliveries, therefore his hourly salary averaged from $8.00 to $9.00 per hour when driving and making deliveries. He also received profit sharing starting at 2.5% of compensation and increasing by 2.5% each year. Additionally, he received vacation and holiday pay based on his hourly salary of $6.30. Wood’s hours in each position varied due to the seasonal nature of Menard’s business. The busiest time is in the fall and the slowest months are during the winter. During the busy season, people work in the yard between 45 and 55 hours per week and are paid time and a half for time worked over 40 hours.

In December 1991, Menard told its lumberyard employees that it had contracted out independent delivery drivers. Menard could not predict if anyone would suffer financially at that time. Wood asked whether there would be any additional compensation but was told that there would be no added pay. He continued to work an *443 average of 40 hours per week for three weeks.

In December 1991, Wood told Menard that he would be quitting in two weeks because he was losing pay. Wood was making $6.40 per hour, with an increase due in May to $6.50 per hour. His profit sharing at the time of termination was up to 7.5%.

Wood filed a claim for unemployment compensation benefits, and the Department determined that Menard arbitrarily changed Wood’s job and pay scale to his detriment, resulting in his voluntary resignation with good cause attributable to Me-nard. A referee affirmed the Department, concluding Wood’s pay decreased by 20%. The Commissioner’s representative affirmed the referee’s decision, determining that Wood’s income decreased by 17%.

ISSUE

Does the record support the Commissioner’s representative’s determination that Wood voluntarily terminated his employment with good cause attributable to his employer due to a substantial reduction in pay?

ANALYSIS

In general, Minnesota unemployment compensation laws are remedial in nature and are liberally construed. Hendrickson v. Northfield Cleaners, 295 N.W.2d 384, 385 (Minn.1980). The legislature intended to assist those who are unemployed through no fault of their own. Minn.Stat. § 268.03 (1990); Yackel v. St. Paul School of Hairdressing, Inc., 270 Minn. 203, 205, 133 N.W.2d 29, 31 (1965). Disqualification provisions are narrowly construed. Danielson Mobil, Inc. v. Johnson, 394 N.W.2d 251, 253 (Minn.App.1986).

The findings must be reviewed in the light most favorable to the decision, and if there is evidence reasonably tending to sustain the findings, they will not be disturbed. White v. Metropolitan Medical Ctr., 332 N.W.2d 25, 26 (Minn.1983). Whether Wood had good cause to quit his job with Menard is a question of law. See Bestler v. Travel Co., 398 N.W.2d 611, 613 (Minn.App.1986) (citing Neubert v. St. Mary’s Hosp. & Nursing Ctr., 365 N.W.2d 780, 782 (Minn.App.1985)).

There is no dispute that Wood voluntarily terminated his employment with Menard. An employee who voluntarily discontinues a job is not entitled to receive unemployment compensation benefits unless it is determined that the employee quit with “good cause attributable to the employer.” Minn.Stat. § 268.09, subd. 1(a) (1990). To avoid disqualification from benefits, the employee bears the burden of showing the separation was for good cause attributable to the employer. Heisler v. B. Dalton Bookseller, 368 N.W.2d 314, 316 (Minn.App.1985).

The tests for “good cause to quit” for purposes of unemployment compensations laws, have been defined:

[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. The standard of what constitutes good cause is the standard of reasonableness as applied to the average man or woman, and not to the supersen-sitive.

Ferguson v. Department of Employment Servs., 311 Minn. 34, 44, 247 N.W.2d 895, 900 n. 5 (1976).

Generally, a substantial pay reduction or an unreasonable change in terms of employment gives an employee good cause for quitting. See Sunstar Foods, Inc. v. Uhlendorf 310 N.W.2d 80, 84 (Minn.1981) (20-25% pay reduction was substantial, but less than 15% was not sufficient to show good cause); Scott v. The Photo Center, Inc., 306 Minn. 535, 536, 235 N.W.2d 616, 616-17 (1975) (change in pay from a fixed salary to a commission, resulting in a 25% pay reduction was substantial); McBride v. LeVasseur, 341 N.W.2d 299, 300 (Minn. App.1983) (unilateral 30% pay reduction was substantial).

*444 The Commissioner’s representative determined that Wood’s salary would decrease by approximately 17%. The representative determined that the “rate of pay” was the issue rather than Wood’s “actual pay.” Therefore, he did not consider holiday, overtime, or profit sharing in determining the pay decrease. The Commissioner’s representative said in passing that these items were not a concern as they would remain about the same. While these items, when calculated, might remain about the same, excluding them was erroneous.

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490 N.W.2d 441, 1992 Minn. App. LEXIS 1009, 1992 WL 276978, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wood-v-menard-inc-minnctapp-1992.