G.L. Williams v. UCBR ( 2015 )

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Genecia L. Williams, :
:
Petitioner :
:
v. : No. 383 C.D. 2015
: Submitted: September 11, 2015
:
Unemployment Compensation :
Board of Review, :
:
Respondent :
BEFORE: HONORABLE BONNIE BRIGANCE LEADBETTER, Judge
HONORABLE ROBERT SIMPSON, Judge
HONORABLE JAMES GARDNER COLINS, Senior Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY
SENIOR JUDGE COLINS FILED: November 10, 2015
Genecia L. Williams (Claimant) petitions this Court for review of an
order of the Unemployment Compensation Board of Review (Board), affirming the
decision of the referee that she was ineligible for unemployment compensation
benefits under Sections 4(u) and 401 of the Unemployment Compensation Law
(the Law),1 43 P.S. §§ 753(u), 801, for 11 weeks in which she received benefits in
2011, imposing a fault overpayment under Section 804(a) of the Law, 43 P.S. §
874(a), and assessing 13 penalty weeks and a penalty of 15% of the overpayment
1
Act of December 5, 1936, Second Ex. Sess., P.L. (1937) 2897, as amended, 43 P.S. §§ 751-
914.
under Section 801(b) and (c) of the Law, 43 P.S. § 871(b), (c). We affirm the
determination that Claimant was ineligible for benefits for the weeks in question,
the determination that the overpayment was a fault overpayment, and the 15%
penalty, but vacate the assessment of penalty weeks and remand this matter to the
Board to address whether the imposition of the maximum penalty weeks is
appropriate given the unusual facts of this case.
On January 3, 2011, Claimant filed an application for unemployment
compensation benefits and was determined to be eligible. (Record Item (R. Item)
1, Claim Record, Reproduced Record (R.R.) at 61a; R. Item 14, Referee’s
Decision/Order Finding of Fact (F.F.) ¶1.) Claimant returned to work at Spruce
Manor/Extendicare Health Services, Inc. (Employer) on January 25, 2011 and
remained employed until she went on medical leave in November 2011. (R. Item
2, Employer Separation Information, R.R. at 50a-56a.) Despite the fact that she
was working, bi-weekly claims for benefits were filed for Claimant for the weeks
ending January 29, 2011 through April 9, 2011 reporting no earnings. (R. Item 14,
Referee’s Decision/Order F.F. ¶4 & Reasoning at 2; R. Item 5, Claimant UC-
990(A) Form, R.R. at 47a; R. Item 1, Claim Record, R.R. at 60a, 70a, 72a.) A total
of $3,630 in benefits was paid to Claimant’s state-issued debit card for these 11
weeks. (R. Item 14, Referee’s Decision/Order F.F. ¶¶4, 6 & Reasoning at 2; R.
Item 1, Claim Record, R.R. at 70a, 72a; R. Item 13, Referee Hearing Transcript
(H.T.) at 15, R.R. at 21a.)
On May 5, 2011, Claimant contacted the Department of Labor &
Industry (Department) and reported that she was working and that her husband had
been filing for benefits without her knowledge or consent. (R. Item 14, Referee’s
Decision/Order F.F. ¶5; R. Item 1, Claim Record, R.R. at 60a; R. Item 13, H.T. at
2
18, R.R. at 24a.) The Department’s Claim Record shows the following notations
concerning calls from Claimant and her husband on May 5, 2011:
DO NOT PAY ANYTHING ON THIS CLAIM CLMT CALL
STATES HUSBAND HAS BEEN FILING ON CLAIM NOT
HER
SHE STATES SHE IS WORKING FULL TIME
HUSBAND, KENNETH WILLIAMS CALLED &
ADMITTED HE FILED 4 WIFE’S BENEFITS W/O HER
KNWLDG. SHES WRKNG NOT FILING
WANTS TO REPAY. ADVSD NO OVP HAS BEEN
ESTABLISHED ON THIS CLM; CLMT WILL RECV LTR -
ONE OVP. IN EFFECT
(R. Item 1, Claim Record, R.R. at 60a.) Notwithstanding this notification by
Claimant, the Department did not establish any overpayment for the January 29,
2011 through April 9, 2011 weeks at that time. (R. Item 13, H.T. at 18-19, 24,
R.R. at 24a-25a, 30a.)
On October 31, 2014, over three years after Claimant had notified it of
the false claims for benefits, the Department sent Claimant a notice of possible
overpayment, stating that her report of no earnings for the January 29, 2011
through April 9, 2011 weeks was inconsistent with her wages reported by
Employer and requesting that she return a questionnaire explaining the
discrepancy. (R. Item 4, Advance Notice, R.R. at 84a-87a.) Claimant, in her
response, did not dispute that an overpayment for the weeks in question occurred,
but asserted that her husband had filed the claims and that the money had been paid
back. (R. Item 5, Claimant UC-990(A) Form, R.R. at 47a.) On November 12,
2012, the Department issued three Notices of Determination with respect to
Claimant. The first determination denied benefits for the weeks ending January
3
29, 2011 through April 9, 2011 pursuant to Sections 401, 4(u), and 404(d) of the
Law, because Claimant had earnings from Employer and knowingly failed to
report those earnings. (R. Item 8, Notice of Determination (Earnings), R.R. at 39a-
40a.) The second determination imposed a fault overpayment of $3,630, pursuant
to Section 804(a) of the Law. (Id., Notice of Determination of Overpayment, R.R.
at 43a-44a.) The third determination assessed 13 penalty weeks and a 15% penalty
of $544.50 pursuant to Section 801(b) and 801(c) of the Law for knowingly
making false statements or knowingly failing to disclose information in order to
obtain or increase benefits. (Id., Notice of Determination of Penalty, R.R. at 45a-
46a.)
Claimant appealed these determinations and, on December 9, 2014,
the referee held a hearing at which Claimant, represented by counsel, appeared and
testified and a Department unemployment claims examiner testified by telephone;
neither Claimant’s husband nor Employer appeared at the hearing. (R. Item 13,
H.T. at 1-2, 8, R.R. at 7a-8a, 14a.)2 At the referee hearing, the Department’s
record of Claimant’s unemployment claims was introduced in evidence showing
that claims were filed in Claimant’s name and under her Social Security number
for the weeks ending January 29, 2011 through April 9, 2011 and that $3,630 in
benefits were paid for those weeks. (R. Item 1, Claim Record, R.R. at 60a, 70a,
72a; R. Item 13, H.T. at 7-9, R.R. at 13a-15a.) Evidence from Employer’s records
was introduced showing that Claimant was employed and paid wages ranging from
$295.20 to $1,111.71 per week during that period, and Claimant admitted that she
2
Claimant sought to introduce a written statement from her husband, but the Department
objected to the statement as hearsay and the referee sustained the objection. (R. Item 13, H.T. at
8-9, R.R. at 14a-15a.) Claimant does not challenge the exclusion of that statement in this appeal.
4
was working full-time during those weeks. (R. Item 2, Employer Separation
Information, R.R. at 50a-56a; R. Item 13, H.T. at 7-9, 11-12, 14, R.R. at 13a-15a,
17a-18a, 20a.) Claimant did not dispute that claims for her were filed for the
weeks ending January 29, 2011 through April 9, 2011 that did not disclose her
employment and earnings and that $3,630 in benefits were paid. (R. Item 13, H.T.
at 9-17, R.R. at 15a-23a.) Claimant testified only that she did not file those claims
and that the claims were filed by her husband without her knowledge. (Id. at 11-
14, R.R. at 17a-20a.) Claimant, however, admitted that the benefits were paid to
her debit card. (Id. at 15, R.R. at 21a.)
Claimant also testified that deductions had been made by the
Department from benefits when she was unemployed in 2012 and that it was her
understanding that those deductions had repaid the January 29, 2011 through April
9, 2011 overpayment. (R. Item 13, H.T. at 12-13, R.R. at 18a-19a.) The
Department unemployment claims examiner testified that the deductions from
Claimant’s 2012 benefits were for a different, earlier overpayment, and the claims
record showed that an overpayment against Claimant existed before she reported
the January 29, 2011 through April 9, 2011 overpayment in May 2011. (Id. at 19-
24, R.R. at 25a-30a; R. Item 1, Claim Record, R.R. at 60a.) The claims examiner
further testified that Claimant could not make restitution for the $3,630
overpayment at issue here until the Department established the overpayment in
2014. (R. Item 13, H.T. at 19, R.R. at 25a.) The claims examiner testified the only
factor considered by the Department in imposing 13 penalty weeks was that “the
Claimant was working full-time at the time of filing for benefits.” (Id.)
On December 18, 2014, the referee issued a decision affirming the
Department’s ineligibility, fault overpayment and penalty determinations. The
5
referee found that Claimant had filed unemployment claims for the weeks ending
January 29, 2011 through April 9, 2011, while she was employed full-time, that
she was ineligible for benefits for those weeks under Sections 4(u) and 401 of the
Law, and that she was paid $3,630 in benefits for those weeks. (R. Item 14,
Referee’s Decision/Order F.F. ¶¶4, 6 & Reasoning at 2-3.) The referee concluded
that the claims record showed that Claimant filed for those weeks of benefits and
rejected as not credible Claimant’s testimony that the claims were filed by her
husband without her knowledge or consent. (Id. Reasoning at 2.) Based on this
credibility determination, the referee found that “the claimant falsified information
for the purpose of receiving benefits to which she was not entitled.” (Id.) The
referee therefore concluded that the overpayment was a fault overpayment under
Section 804(a) of the Law and that the 15% penalty of $544.50 and 13 penalty
weeks were properly imposed because “benefits were paid as a result of fraud.”
(Id. Reasoning at 2-3.) Although the referee specifically found that Claimant
reported the overpayment in May 2011 (id. F.F. ¶5), the referee did not discuss this
fact in upholding the imposition of 13 penalty weeks.
Claimant appealed, and on February 25, 2015, the Board issued an
order affirming the referee’s decision. In its Order, the Board adopted and
incorporated the findings and conclusions of the referee, including the referee’s
credibility determination, and made no additional findings. (Record Item 19,
Board Order.) Claimant filed the instant petition for review appealing the Board’s
order to this Court.3
3
Our review of the Board’s decision is limited to determining whether necessary findings of fact
are supported by substantial evidence, whether errors of law were committed and whether
constitutional rights were violated. Chishko v. Unemployment Compensation Board of Review,
934 A.2d 172, 176 n.4 (Pa. Cmwlth. 2007).
6
In this appeal, Claimant does not dispute that the Board properly
affirmed the ruling that she was ineligible for benefits for the weeks ending
January 29, 2011 through April 9, 2011 and that the claims filed for benefits for
those weeks falsely reported her employment and earnings. Claimant also does not
contend that the Board erred in affirming the amount of the overpayment and no
longer contends that any of the deductions to her benefits in 2012 repaid any of the
$3,630 overpayment. Claimant challenges only the Board’s affirmance of the
determination that the overpayment was a fault overpayment and the award of
penalties, arguing that the claims were filed by her husband and that there is no
evidence that she, as opposed to her husband, intentionally misled the Department
to obtain those benefits. Claimant asserts in support of these arguments that she
reported the overpayment and sought to repay it in 2011, more than three years
before the Department assessed the overpayment.
We are not persuaded that the Board erred in upholding the fault
overpayment. Section 804(a) of the Law provides that “[a]ny person who by
reason of his fault has received any sum as compensation under this act to which
he was not entitled, shall be liable to repay … a sum equal to the amount so
received by him ….” 43 P.S. § 874(a). The word “fault,” under Section 804(a),
connotes an act to which blame, censure, impropriety, shortcoming, or culpability
attaches. Castello v. Unemployment Compensation Board of Review, 86 A.3d 294,
298 (Pa. Cmwlth. 2013); Chishko v. Unemployment Compensation Board of
Review, 934 A.2d 172, 177 (Pa. Cmwlth. 2007); Summers v. Unemployment
Compensation Board of Review, 430 A.2d 1046, 1048 (Pa. Cmwlth. 1981). Filing
a claim for unemployment compensation benefits while employed, without
reporting that employment and the earnings from it, constitutes conduct designed
7
to mislead the unemployment compensation authorities and is sufficient to
establish a fault overpayment. Castello, 86 A.3d at 298-99; Chishko, 934 A.2d at
177-78; Summers, 430 A.2d at 1048. “Truthfully divulging all pertinent
information regarding one’s employment status is required so the unemployment
compensation authorities may make an intelligent and well-informed decision as to
a claimant’s eligibility for benefits and proper computation of such benefits.”
Castello, 86 A.3d at 298.
To find fault, the Board or referee must make some findings with
regard the claimant’s state of mind. Castello, 86 A.3d at 298; Chishko, 934 A.2d
at 177; Greenawalt v. Unemployment Compensation Board of Review, 543 A.2d
209, 211 (Pa. Cmwlth. 1988). Admission by the claimant concerning her
knowledge or conduct, however, is not required for the Board to find that the
claimant acted knowingly and with intent to mislead. Castello, 86 A.3d at 299.
Evidence from the claimant’s claim record showing the filing of the claim and the
failure to report any wages, coupled with evidence that the claimant received
substantial wages for that time period, is sufficient by itself to permit the Board to
infer and find that the claimant intentionally failed to report earnings, even where
there is no other testimony or evidence as to the claimant’s knowledge, actions or
state of mind. Id. (affirming fault overpayment based on claim record, even
though claimant did not appear at the hearing).
Here, the Board found that Claimant filed claims for weeks in
question and knowingly failed to report that she was employed in order to obtain
benefits that she was not eligible to receive. (R. Item 14, Referee’s Decision/Order
Reasoning at 2; Record Item 19, Board Order.) While Claimant testified that the
false claims were filed by her husband, the Board found that this testimony was not
8
credible. (R. Item 14, Referee’s Decision/Order Reasoning at 2-3; Record Item 19,
Board Order.) Issues of credibility are for the Board, not this Court, and the Board
may accept or reject a witness’s testimony whether or not it is corroborated by
other evidence and even if it is uncontradicted. Ellis v. Unemployment
Compensation Board of Review, 59 A.3d 1159, 1164 (Pa. Cmwlth. 2013);
Chapman v. Unemployment Compensation Board of Review, 20 A.3d 603, 607 (Pa.
Cmwlth. 2011). Given the Board’s rejection of Claimant’s denial of involvement
as not credible, the claim record showing that claims were filed in Claimant’s
name and under her Social Security number for the weeks ending January 29, 2011
through April 9, 2011, Claimant’s admission that she was employed and ineligible
those weeks and the evidence that benefits were paid for those weeks to her debit
card constitute substantial evidence sufficient to support the Board’s findings that
Claimant filed the claims and intentionally misled the Department. Castello, 86
A.3d at 299 (claim record showing false claim filed in claimant’s name constituted
substantial evidence that claimant intentionally failed to report earnings and was
sufficient to support fault overpayment); see also Monserrate v. Commissioner of
Labor, 958 N.Y.S.2d 528, 529 (N.Y. App. Div. 2013) (upholding determination of
willful misrepresentation to obtain unemployment benefits where agency records
showed false certifications in claim filed by claimant and benefits were deposited
into his account, despite claimant’s contention that he did not file the certifications,
which finder of fact rejected as not credible). The Board therefore did not err in
concluding that Claimant’s overpayment was a fault overpayment. Castello, 86
A.3d at 299; Chishko, 934 A.2d at 177-78; Summers, 430 A.2d at 1048.
Greenawalt, relied on by Claimant, is not to the contrary. In
Greenawalt, the evidence of the claimant’s state of mind was insufficient to show
9
intent to mislead because the reports submitted by the claimant that underreported
her earnings were prepared by her employer and there was no evidence that
claimant knew that those earnings reports were inaccurate. 543 A.2d at 210-11. In
contrast, in this case, Claimant does not dispute that the claims were knowingly
falsely filed and that her knowledge of her employment and earnings was sufficient
to support a fault overpayment. Claimant’s contention that fault was not shown
was based entirely on her testimony that she was not the person who filed the
claims, and the Board rejected that testimony as incredible.
Claimant correctly notes that she reported the false claims for benefits
to the Department in May 2011. The Board found that “[o]n May 5, 2011, the
claimant contacted the Department and informed a representative that she was
working full-time with [Employer] and her husband had been filing for benefits
without her knowledge or consent.” (R. Item 14, Referee’s Decision/Order F.F.
¶5; Record Item 19, Board Order.) This finding is supported by the Department’s
records and its claims examiner’s testimony. (R. Item 1, Claim Record, R.R. at
60a; R. Item 13, H.T. at 18, R.R. at 24a.) The fact that Claimant brought the
improper benefits to the Department’s attention after the fact on her own initiative,
however, does not alter the fact that the overpayment was obtained by
misrepresentation and is not a ground for reversing a fault overpayment.
McKean v. Unemployment Compensation Board of Review, 94 A.3d 1110, 1114-15
(Pa. Cmwlth. 2014) (upholding fault overpayment despite fact that claimant
notified Department of unreported income one month after the last overpayment).
In addition to fault overpayment, under Section 801 of the Law, a
claimant who “makes a false statement knowing it to be false, or knowingly fails to
disclose a material fact to obtain or increase compensation” is subject to penalty
10
weeks disqualifying her from receiving future benefits and a penalty of 15% of the
overpaid benefits that she received. 43 P.S. § 871(b),(c);4 Chishko, 934 A.2d at
178. The Board’s findings that Claimant’s conduct constituted knowing
misrepresentation and that it was done to obtain benefits that she was not eligible
to receive and that she obtained the benefits by fraud (R. Item 14, Referee’s
Decision/Order Reasoning at 2-3; Record Item 19, Board Order), satisfy the
4
Sections 801(b) and (c) provide:
(b) Whoever makes a false statement knowing it to be false, or knowingly fails to
disclose a material fact to obtain or increase any compensation or other payment
under this act or under an employment security law of any other state or of the
Federal Government or of a foreign government, may be disqualified in addition to
such week or weeks of improper payments for a penalty period of two weeks and for
not more than one additional week for each such week of improper payment:
Provided, That no additional weeks of disqualification shall be imposed under this
section if prosecution proceedings have been instituted against the claimant because
of such misrepresentation or non-disclosure. The departmental determination
imposing penalty weeks under the provisions of this subsection shall be subject to
appeal in the manner provided in this act for appeals from determinations of
compensation. The penalty weeks herein provided for shall be imposed against any
weeks with respect to which the claimant would otherwise be eligible for
compensation, under the provisions of this act, which begin within the four year
period following the end of the benefit year with respect to which the improper
payment or payments occurred.
(c) Whoever makes a false statement knowing it to be false, or knowingly fails to
disclose a material fact to obtain or increase compensation or other payment under
this act or under an employment security law of the Federal Government and as a
result receives compensation to which he is not entitled shall be liable to pay to the
Unemployment Compensation Fund a sum equal to fifteen per centum (15%) of the
amount of the compensation. The sum shall be collectible in the manner provided in
section 308.1 or 309 of this act for the collection of past due contributions and by any
other means available under Federal or State law. No administrative or legal
proceeding for the collection of the sum may be instituted after the expiration of ten
years following the end of the benefit year with respect to which the sum was paid.
43 P.S. § 871(b),(c).
11
requirements for imposition of these penalties. Castello, 86 A.3d at 299; Chishko,
934 A.2d at 178.
The Board therefore did not err in affirming the 15% penalty imposed
by the Department. Section 801(c) provides that the 15% penalty is mandatory
where the Board has found that a claimant knowingly made a false representation
concerning her eligibility or knowingly failed to disclose such information to
obtain benefits. 43 P.S. § 871(c) (“Whoever makes a false statement knowing it to
be false, or knowingly fails to disclose a material fact to obtain or increase
compensation … and as a result receives compensation to which he is not entitled
shall be liable to pay to the Unemployment Compensation Fund a sum equal to
fifteen per centum (15%) of the amount of the compensation”) (emphasis added).
Penalty weeks, however, are not automatic upon a finding of conduct
sufficient to support a penalty. Section 801(b) provides that a claimant who has
made knowing misrepresentations or omissions to obtain benefits “may be
disqualified in addition to such week or weeks of improper payments for a penalty
period of two weeks and for not more than one additional week for each such week
of improper payment.” 43 P.S. § 871(b) (emphasis added). Here, the Board found
that Claimant reported the fraudulent claims to the Department in 2011, and
Department records showed that Claimant expressed a willingness to repay the
benefits in 2011, but was told to await an overpayment letter that the Department
did not send. (R. Item 14, Referee’s Decision/Order F.F. ¶5; Record Item 19,
Board Order; R. Item 1, Claim Record, R.R. at 60a; R. Item 13, H.T. at 18-19, R.R.
at 24a-25a.) While self-reporting does not preclude the imposition of penalty
weeks, McKean, 94 A.3d at 1114-15, these facts are relevant to the seriousness of
Claimant’s misconduct and therefore can bear on the discretionary determination
12
as to whether penalty weeks are appropriate and whether the number of penalty
weeks imposed should be less than maximum permitted by Section 801(b).
The Department imposed and the Board upheld the maximum number
of penalty weeks permitted for this 11-week overpayment, 13 penalty weeks, with
no consideration of the unusual mitigating circumstances in this case. The only
reason given by the Department for its imposition of the maximum penalty weeks
was that Claimant knew that she was ineligible when she filed for benefits and was
therefore subject to penalty weeks. (R. Item 13, H.T. at 19, R.R. at 25a.) The
referee and the Board held only that “penalty weeks” were “appropriate,” and did
not discuss their finding that Claimant reported the fraud to the Department in
2011 or rule on the issue whether imposition of the maximum penalty weeks was
appropriate. (R. Item 14, Referee’s Decision/Order Reasoning at 3; Record Item
19, Board Order.) Because the Board did not consider relevant facts established by
both its findings and the record, and did not address the issue of whether the
maximum penalty weeks were properly imposed, the Board’s affirmance of the
imposition of 13 penalty weeks must be vacated and the issue of penalty weeks
must be remanded to the Board. See Dorn v. Unemployment Compensation Board
of Review, 866 A.2d 497, 501-02 (Pa. Cmwlth. 2005) (remand required where
Board failed to make necessary findings or failed to address evidence); Kowal v.
Unemployment Compensation Board of Review, 465 A.2d 1322, 1323 (Pa.
Cmwlth. 1983) (remand required where Board failed to address issue and make
necessary findings).
For the foregoing reasons, we affirm the Board’s order insofar as it
affirmed the determination of ineligibility, the fault overpayment and the
13
imposition of a 15% penalty, but remand the issue of penalty weeks to the Board to
consider whether and how many penalty weeks are appropriate.
____________________________________
JAMES GARDNER COLINS, Senior Judge
14
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Genecia L. Williams, :
:
Petitioner :
:
v. : No. 383 C.D. 2015
:
Unemployment Compensation :
Board of Review, :
:
Respondent :
ORDER
AND NOW, this 10th day of November, 2015, the order of the
Unemployment Compensation Board of Review (Board) in the above-captioned
matter is AFFIRMED insofar as it upheld the determinations that Petitioner was
ineligible for benefits for the weeks ending January 29, 2011 through April 9,
2011, and that imposed a fault overpayment of $3,630.00 and a 15% penalty of
$544.50. The order of the Board is VACATED insofar as it upheld the assessment
of 13 penalty weeks. This matter is REMANDED to the Board to consider
whether the imposition of the maximum penalty weeks is appropriate under the
findings and evidence in this case.
Jurisdiction relinquished.
____________________________________
JAMES GARDNER COLINS, Senior Judge