Young v. District of Columbia, Department of Employment Services

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DISTRICT OF COLUMBIA COURT OF APPEALS
No. 21-AA-97
ASHLEY YOUNG, PETITIONER,
V.
D.C. DEPARTMENT OF EMPLOYMENT SERVICES, RESPONDENT.
Petition for Review from the District of Columbia
Office of Administrative Hearings
(DOES-5521-20)
(Hon. Arabella Teal, Administrative Law Judge)
(Argued October 14, 2021 Decided February 3, 2022)
Jonathan H. Levy, with whom Nicole Dooley and Mariah Hines were on the
brief, for petitioner.
Ashwin P. Phatak, Deputy Solicitor General, with whom Karl A. Racine,
Attorney General, Loren L. AliKhan, Solicitor General, Caroline S. Van Zile,
Principal Deputy Solicitor General, and Richard S. Love, Senior Assistant Attorney
General, were on the brief, for respondent.
Before BECKWITH and MCLEESE, Associate Judges, and FISHER, Senior
Judge.
BECKWITH, Associate Judge: Petitioner Ashley Young challenges the
decision of an administrative law judge (ALJ) who concluded that Ms. Young’s
2
failure to complete a quality control audit of the processing of her unemployment
benefits claim made her ineligible for back benefits. For the reasons set forth in this
opinion, we reverse and remand with instructions to award Ms. Young benefits for
the contested weeks.
I.
The following facts appear to be undisputed. Ms. Young applied for
unemployment benefits on November 5, 2019, after her employer, a food services
company, fired her. Later that month, a Department of Employment Services
(DOES) claims examiner determined that Ms. Young had been discharged for
misconduct and disqualified her from receiving benefits. Ms. Young’s denied claim
was then randomly selected for participation in a quality control audit known as the
Benefits Accuracy Measurement (BAM), and on November 26, 2019, a DOES
investigator named Darian Cole mailed her a letter and a copy of the BAM form she
was to complete.
Mr. Cole’s letter stated that Ms. Young’s “denial determination [wa]s one of
a small number picked at random to assess program quality” through a BAM audit
that would examine “the correctness of the decision to deny [Ms. Young] benefits.”
If the BAM detected an error, Mr. Cole wrote, DOES “may not be able to correct
it . . . due to finality regulations.” Mr. Cole therefore cautioned that Ms. Young
3
“must not rely on this review to result in corrective action.” In addition to a copy of
the BAM, Mr. Cole included a fact sheet that instructed claimants whose
applications for benefits were denied “to pursue their appeal rights without regard to
this [BAM investigation].” That fact sheet further warned that if a BAM “response
is received after an interruption of unemployment benefits, reinstatement of benefits
occurs as of that date and payments are not retroactive.” Mr. Cole’s letter instructed
Ms. Young to return the BAM form within seven days.
Several weeks after mailing the letter, Mr. Cole followed up by emailing Ms.
Young on three occasions asking her to complete the BAM. Each email included a
copy of the BAM, a new due date, and a notice that “[f]ailure to report, disclose,
and/or provide information when directed or to complete the questionnaire by the
due date may result in a delay or denial of benefits.” But Ms. Young, who was
having issues with the U.S. Mail—including a time in which she was not receiving
any mail at all—and who had not been checking her junk email folder during this
time, did not receive DOES’s communications about the BAM. In fact, she did not
learn of the request to fill out the BAM until July 2020, when she called DOES for
an update on her claim and was directed to Mr. Cole. Once Ms. Young reached Mr.
Cole, she completed the BAM questionnaire while she was on the phone with him.
What Ms. Young did not learn during her phone call with Mr. Cole, however,
4
was that when she had not returned the BAM form to DOES back in January, Mr.
Cole had issued a determination that she had failed to report as directed, meaning
that she could remain ineligible for benefits “until such time as contact is made with
[the DOES] office.” When Ms. Young learned this in October 2020, she filed an
appeal with the Office of Administrative Hearings (OAH). At a hearing, the ALJ
took testimony from Mr. Cole regarding his various mailings and the failure-to-
report determination that rendered Ms. Young ineligible for benefits. 1 In her own
testimony, Ms. Young explained that the mail delivery to her apartment was
unreliable and noted that she had eventually discovered an email from Mr. Cole in
her junk email folder.
After determining that she would not fault Ms. Young for filing her appeal
outside the fifteen days claimants have to challenge an examiner’s determination, 2
the ALJ considered whether good cause excused Ms. Young’s failure to report.
1
Though Ms. Young’s former employer initially disputed her eligibility for
unemployment compensation, by the time of the hearing it no longer contested her
claim.
2
The ALJ concluded that Ms. Young “proved that the delay in filing the
appeal was due to a combination of good cause (she did not know of the DOES
failure to report decision until July 2020) and excusable neglect (she did not obtain
a copy of the Determination until October 16, 2020).”
5
Citing D.C. Code § 51-109(1) (2020 Repl.) 3 and 7 D.C.M.R. § 304.4(g) (2022), 4 the
ALJ noted that the Unemployment Compensation Act “prevents a claimant from
receiving benefits if she fails to respond to a DOES request for any information
needed about her claim” and that a claim for benefits must have been made “in
accordance with such regulations as . . . [DOES] may prescribe.” Though she
acknowledged the lack of a “specific standard for assessing failures to report
information of the kind DOES sought in this case,” the ALJ ultimately determined
that Ms. Young did not have good cause for her initial failure to report as directed.
Ms. Young was, however, eligible for benefits beginning July 19—the beginning of
the week during which she completed the BAM survey. 5
II.
On petition for review, Ms. Young argues that in these circumstances, the ALJ
3
“An unemployed individual shall be eligible to receive benefits with respect
to any week only if it has been found by the Director: (1) That he has made a claim
for benefits with respect to such week . . . .”
4
“Claimants shall state the following with respect to their initial claims: (g)
Any other information as the Director determines is reasonably necessary to
establish the individual's eligibility for benefits, including the reason for separation
given the claimant by his or her last employer.”
5
DOES considers eligibility on a weekly basis. So although Ms. Young
completed the BAM on July 23, a Thursday, DOES lifted her disqualification as of
the prior Sunday, and the ALJ followed suit.
6
had no authority to determine that Ms. Young was ineligible for back benefits and
that the ALJ’s decision contravened both the humanitarian purpose of the
Unemployment Compensation Act and due process. 6 She therefore asks us to
reverse the ALJ’s decision and direct the agency to grant the benefits at issue. 7
DOES counters that the pertinent regulations allow DOES to condition benefits upon
completion of the BAM.
We affirm an OAH decision when “(1) OAH made findings of fact on each
materially contested issue of fact, (2) substantial evidence supports each finding, and
6
DOES argues that we should not consider any of the arguments Ms. Young
presents in her petition on review because she did not make these arguments to the
ALJ. As an initial matter, “a reviewing court has discretionary authority to consider
issues which have not been raised before the agency” in the event of “exceptional
circumstances.” Goodman v. District of Columbia Rental Hous. Comm’n, 573 A.2d
1293, 1301 n.21 (D.C. 1990). We need not decide if such “exceptional
circumstances” are present here, however. See id. Even if Ms. Young’s claim that
she was eligible for the disputed benefits did not include the argument we address
on appeal, the ALJ determined that DOES had the statutory and regulatory authority
to deny back benefits in this case, and DOES has not identified any significant
prejudice stemming from our consideration of this claim. See District of Columbia
v. District of Columbia Cont. Appeals Bd., 145 A.3d 523, 530 n.9 (D.C. 2016)
(finding no waiver where the agency passed upon the issues and where the court saw
no prejudice in reviewing them); Black v. District of Columbia Dep’t of Human
Servs., 188 A.3d 840, 848 (D.C. 2018) (noting that even an unargued claim may be
considered as long as it was “passed upon” and that parties on appeal are not limited
to the exact arguments made before the agency).
7
Beyond Ms. Young’s request that the case be remanded with instructions to
award her benefits, neither party has asked the court to remand the case for further
proceedings.
7
(3) OAH’s conclusions flow rationally from its findings of fact.” Rodriguez v.
Filene’s Basement Inc., 905 A.2d 177, 180 (D.C. 2006). Factual findings are
supported by “substantial evidence” when there is such “relevant evidence as a
reasonable mind might accept as adequate to support a conclusion.” Id. at 181(quoting Gardner v. District of Columbia Dep’t of Emp. Servs., 736 A.2d 1012, 1015
(D.C. 1999)). We uphold OAH’s legal conclusions unless they are “arbitrary,
capricious, an abuse of discretion, or otherwise not in accordance with law.” D.C.
Code § 2-510(a)(3)(A) (2021 Repl.). “[W]e are not obliged to stand aside and affirm
an administrative determination which reflects a misconception . . . or a faulty
application of the law.” Thomas v. District of Columbia Dep’t of Lab., 409 A.2d
164, 169 (D.C. 1979).
In the view of DOES, 7 D.C.M.R. § 304.4(g) and 7 D.C.M.R. § 316 gave
DOES the authority to deny Ms. Young benefits for the period in which she failed
to complete the BAM. More specifically, DOES argues that the BAM form was
“reasonably necessary to establish” Ms. Young’s eligibility for benefits under
§ 304.4(g), that it also fell within the reporting requirements of § 316, 8 and that as a
8
This regulation states, in relevant part, that “[e]ach claimant shall register
and inquire for work as specifically instructed by the Director,” 7 D.C.M.R. § 316.2,
and that “[a] claimant who fails to register and inquire for work as instructed by the
Director may be held ineligible for each week in which the registration requirement
is not met.” 7 D.C.M.R. § 316.5. According to DOES, a claimant’s ongoing
8
result, Ms. Young’s failure to submit the form could properly result in the loss of
benefits for which she was otherwise eligible. 9
At the outset, the record in this case supplies some reasons to doubt the notion
that the BAM is a mechanism for determining initial and ongoing eligibility for
unemployment compensation. Ms. Young had already been deemed ineligible to
receive unemployment compensation when a BAM investigator, not a claims
examiner, sent her the BAM. The BAM’s purpose, according to materials DOES
sent to Ms. Young, was to “test the validity of Unemployment Insurance benefits
payments and denials” and “assess the accuracy of monetary determinations and the
proper detection and resolution of eligibility issues” throughout the program.
Although counsel for DOES represented at oral argument that the government had a
policy of correcting errors discovered through BAM results, DOES’s letter to Ms.
Young stated that the agency “may not be able to correct [mistakes] . . . due to
finality regulations” and that claimants “must not rely on this review to result in
corrective action.” DOES also instructed Ms. Young to file a formal appeal “without
obligation to report about job applications and so forth extends, as well, to the BAM.
9
DOES contends that Ms. Young forfeited any due process challenge to
DOES’s statutory scheme because she did not raise it before the ALJ. Because we
decide this petition on other grounds, we need not decide whether the due process
challenge is properly before us.
9
regard to this audit.”
These discrepancies suggest that the BAM is not consistently understood as a
procedure for determining eligibility—and indeed, the regulations governing
eligibility for benefits do not mention the BAM, let alone specify a deadline for
completing the BAM or the consequence of failing to do so. A quality control survey
like the BAM is far from the paradigm of an undertaking that is “reasonably
necessary to establish a claimant’s eligibility for benefits,” 7 D.C.M.R. § 304.4(g).
It is likewise less than clear how a claimant’s obligation to “register and inquire for
work” under 7 D.C.M.R. § 316.2 is served by submission of a BAM form.
But we need not decide whether the regulations authorize the DOES to deny
benefits based on a claimant’s failure to participate in a quality control audit. Even
assuming DOES’s interpretation of the regulations can stand as a matter of law, the
ALJ did not make the case for applying them in these circumstances. The ALJ did
not explain how the deadlines DOES imposed in this case constituted “reasonable
claim information filing requirements” or how the information requested by the
BAM was “necessary.” Even if the judge had elaborated upon the basis for her
ruling, the record was devoid of evidence justifying the particular deadlines or
establishing the BAM’s necessity to the eligibility determination in this case. The
documents DOES presented at the hearing introduced an ambiguity that the ALJ
10
never grappled with. In the BAM fact sheet, DOES warned that if benefits were
interrupted—which Ms. Young’s were not—“reinstatement of benefits occurs as of
[the BAM response] date and payments are not retroactive.” (emphasis added). The
BAM itself says that failing to complete the BAM “by the due date may result in a
delay or denial of benefits.” (emphasis added). The ALJ did not resolve this
inconsistency or explain why Ms. Young’s failure to complete the BAM by one of
a series of deadlines set by a BAM investigator necessarily divested her of benefits.
The District’s Unemployment Compensation Act “is remedial humanitarian
legislation of vast import” that “must be broadly and liberally construed . . . for the
benefit of unemployed workers.” Cruz v. District of Columbia Dep’t of Emp. Servs.,
633 A.2d 66, 69 (D.C. 1993) (quoting Pittsburg Pipe & Coupling Co. v. Unemp.
Comp. Bd. of Rev., 165 A.2d 374, 377–78 (Pa. 1960)). On the record before us, we
cannot say that the ALJ gave “full and reasoned consideration” to why Ms. Young’s
failure to complete the BAM should deprive her of back benefits. See Hamilton v.
Hojeij Branded Food, Inc., 41 A.3d 464, 477 (D.C. 2012) (quoting Dietrich v.
District of Columbia Bd. of Zoning Adjustment, 293 A.2d 470, 473 (D.C. 1972)); see
also U.N. v. District of Columbia Dep’t of Emp. Servs., 2009 WL 4234139 (D.C.
Off. of Admin. Hearings July 28, 2009) (reversing an ineligibility determination
where DOES provided inconsistent information about the effect of failing to file a
weekly claim because of the remedial purpose of the Unemployment Compensation
11
Act); cf. Ridge v. Police and Firefighters Ret. & Relief Bd., 511 A.2d 418 (D.C.
1986) (holding that, in the absence of explicit statutory guidance, the Police and
Firefighters Retirement and Disability Act did not support denying an otherwise
eligible claimant back benefits). Particularly given the lack of clarity in this record
and the dearth of relevant evidence, the ALJ was obligated to “broadly and liberally
construe[]” the Unemployment Compensation Act in favor of Ms. Young. Cruz,
633 A.2d at 69.
In sum, the ALJ’s denial of unemployment benefits for which Ms. Young was
otherwise eligible was arbitrary and did not flow rationally from the facts. 10 See,
e.g., Hamilton, 41 A.3d at 478 (reversing an ALJ’s denial of benefits based on gross
misconduct where that conclusion was “unwarranted” in light of “the state of the
record” and “the humanitarian purposes of the unemployment compensation
statute”). We therefore reverse the ALJ’s order and remand with instructions to
award Ms. Young benefits for the contested weeks.
So ordered.
10
That the ALJ treated Ms. Young’s completion of the BAM as triggering her
eligibility indicated that Ms. Young otherwise was eligible to receive benefits.