Willful Misconduct Disqualifies Unemployment Benefits

As recounted in a court opinion, Michelle Wood was employed by a company called Ken’s Beverage; her last position was as a dispatch supervisor. Between June 2010 and July 2017, she received at least 12 documented warnings—including six for unprofessional behavior. On July 5, 2017, Wood received a final written warning for unprofessional conduct, for making an inappropriate comment about an employee’s sexual orientation.

The following March, Ken’s Beverage fired Wood for engaging in hostile and disruptive work behavior. The company gave Wood an “employee counseling form” for her conduct after issuance of the final warning, stating that she demonstrated a continued pattern of abusive, petty and passive-aggressive behavior against her supervisors as well as three dispatchers under her supervision. It also said that she blatantly ignored requests from the operations manager. Ken’s Beverage concluded that Wood’s repeated behavior created a hostile work environment.

Wood then filed a claim for unemployment security benefits. After a hearing, Referee Ott ruled that the evidence showed the employer fired Wood for misconduct, which meant she would not receive unemployment benefits. On appeal, the Department of Employment Security Board of Review reversed the ruling and the Circuit Court affirmed the Board of Review. Ken’s Beverage then successfully appealed. The appeals court ruling provides guidance on proving “misconduct” under Illinois unemployment law.

Guidance for Employers

As noted above, an employee who is discharged for misconduct is ineligible for unemployment insurance benefits. To establish misconduct, the employer must show that:

1. There was a deliberate and willful violation of a rule or policy of the employing unit;
2. The rule or policy was reasonable; and
3. The violation either harmed the employer or was repeated by the employee despite a previous warning or other explicit instruction from the employing unit.

The appeals court provided some helpful guidance in this case. Harm includes damage or injury to other employees’ well-being or morale. Misconduct can be premised on either a single violation of an employer’s rules that triggered the employee’s discharge, or cumulative violations of the employer’s rules taken as a whole. Willful misconduct occurs where an employee is aware of a company rule and consciously disregards it.

In Wood’s case, the record established each of the necessary elements to prove employee misconduct. Ken’s Beverage had a policy against sexual harassment; the parties did not dispute that this policy was reasonable. The sole issue presented was whether Wood willfully violated the policy, despite repeated warnings from 2010 to 2017 for insubordination and disruptive work behavior.

The Value of Documentation

She did. Despite warnings and the final notice she received, Wood continued her abusive, offensive behavior and insubordination. Two dispatchers supervised by Wood complained to the company about her behavior, even after she got her final warning. The evidence of Wood’s prior documented warnings was sufficient to satisfy the burden of proof that Woods was guilty of disqualifying misconduct.

Employment lawyers preach to their business clients about the value of careful and consistent documentation. Such documentation, along with a clear policy and numerous fair warnings, allowed Ken’s Beverage to establish that Wood was ineligible for unemployment benefits. PM