Amended October 3, 2016 Sondra Irving v. Employment Appeal Board

IN THE SUPREME COURT OF IOWA
No. 15–0104
Filed June 3, 2016
Amended October 3, 2016
SONDRA IRVING,
Appellant,
vs.
EMPLOYMENT APPEAL BOARD,
Appellee.
Appeal from the Iowa District Court for Linn County, Denver D.
Dillard, Judge.
Claimant appeals district court judgment affirming denial of
unemployment benefits for a job termination resulting from her
incarceration. REVERSED.
Alisa Diehl of Iowa Legal Aid, Cedar Rapids, for appellant.
Rick Autry of Iowa Employment Appeal Board, Des Moines, for
appellee.
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APPEL, Justice.
In this case, an employee was terminated because of absence from
work arising out of her incarceration on criminal charges unrelated to
the work place. The employee filed for unemployment benefits. The Iowa
Employment Appeal Board (EAB) denied the benefits on the grounds that
her absence from the workplace was misconduct and should be regarded
as a voluntary quit. The employee appealed. The district court affirmed.
The employee then appealed to this court. For the reasons expressed
below, we reverse.
I. Background Facts and Proceedings.
Sondra Irving was employed as a medical assistant at the
University of Iowa Hospitals and Clinics (UIHC). She was arrested on
November 28, 2013, and incarcerated through December 24, but the
charges were ultimately dismissed.
Irving was scheduled to resume work on December 3. At Irving’s
request, her mother called UIHC every work day between December 2
and December 11 to report that Irving would be absent from work. On
December 11, an employee at UIHC told Irving’s mother that she did not
need to call anymore because Irving had been placed on a leave of
absence. Irving’s supervisors at UIHC visited her on December 5 and
told her they were doing everything they could to make sure she did not
lose her job. Irving’s supervisors continued to visit on visiting days, and
they told her that she had been placed on a leave of absence.
After she was released, Irving attempted to return to work and was
told that she was no longer employed. Irving attempted to reapply for
her job and was rejected. Irving applied for unemployment insurance
benefits on January 16, 2014, under the Iowa Employment Security Law.
See Iowa Code ch. 96 (2013). Iowa Workforce Development denied her
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application in a letter stating, “Our records indicate you voluntarily quit
work on 12/20/13, because you were arrested and confined in jail. Your
quitting was not caused by your employer.” Irving appealed the decision.
The unemployment insurance appeal hearing was held before an
administrative law judge.
At the hearing, a representative from UIHC testified that they
considered Irving to have quit after failing to report to work for three
consecutive days without proper notification and authorization. The
representative said they knew she was incarcerated and received calls
from Irving’s mother but that any leave of absence required specific
procedures and prior authorization, which Irving failed to follow or
obtain. Further, the representative stated that they applied Irving’s
accrued vacation time to attempt to cover her absence, but her vacation
was exhausted by December 3, 2013.
Irving attempted to introduce evidence about the charges against
her and their dismissal at the time of the hearing, but evidence on that
topic was rejected as not being relevant to her separation from UIHC.
The administrative law judge rejected Irving’s application for
unemployment insurance benefits because Irving voluntarily quit without
good cause attributable to her employer under Iowa Code section 96.5(1)
and Iowa Administrative Code rule 871—24.25(16) (2013). The
administrative law judge also noted that even if Irving had proved she did
not voluntarily quit, the outcome would be the same because excessive
unexcused absences due to incarceration qualify as misconduct.
Irving appealed to the EAB, arguing that she did not voluntarily
quit and that her absenteeism was not the result of a matter of personal
responsibility and thus did not constitute misconduct. She argued that
she attempted to introduce evidence of her innocence of the charges for
4
which she was incarcerated, that this evidence was rejected by the
administrative law judge, and that the rejection of the evidence was an
error.
The EAB affirmed the administrative law judge, noting that a
voluntary quit is based upon an employee’s subjective intent but that
“the reality of the incarceration and [the employee’s] subjective hopes of
keeping the job are at odds.” It therefore found Irving to have voluntarily
quit. The EAB also found that her absenteeism constituted misconduct
because Irving’s legal problems were an issue of personal responsibility.
The EAB noted that it was accepting evidence of the dismissal of Irving’s
charges but not a letter she submitted which explained the reason for the
dismissal. Finally, the EAB noted that Irving was separated from a
second job the same week she was separated from UIHC—evidence about
which was not presented before the administrative law judge nor
described in EAB’s decision—and explained that once Irving requalified
for unemployment benefits, the disqualification would be lifted from both
discharges. The EAB stated that this observation about Irving’s second
job played no role in its decision relating to her job at UIHC.
Irving appealed to the district court, which concluded that the EAB
properly denied her unemployment compensation benefits on the basis of
a voluntary quit resulting from her incarceration. The district court also
said that the EAB could have properly found that Irving voluntarily quit
because of excessive absences without proper notification or for
misconduct because of excessive absences. The district court’s decision
was filed on December 18, 2014.
Irving filed a timely notice of appeal. On appeal, Irving asserts that
her involuntary incarceration cannot be considered a voluntary quit or
misconduct under Iowa unemployment insurance law. See Iowa Code
5
§ 96.5(1). The EAB defends its own decision and the district court on
both these issues.
The EAB, however, raises a new issue not raised before the agency
or the district court. For the first time on this appeal, the EAB notes that
at the time of her incarceration, Irving had two jobs, one with UIHC, and
a second job which was not mentioned in the record. The EAB states
that Irving lost both jobs as a result of her incarceration. It asserts that
Irving’s disqualification for benefits as to the second job was based on
discharge for misconduct arising out of her failure to report her arrest. It
claims that in the matter of the second job, Irving lost before the agency
and lost on appeal before the district court in an order entered February
18, 2015, approximately two months after the district court order
denying her benefits associated with her discharge from UIHC. The EAB
indicates that Irving failed to appeal the decision in the matter of the
second job, however, and that as a result, the district court’s
determination that she was disqualified from receiving unemployment
benefits in that case became final.
Now, on appeal of the case involving Irving’s termination from
UIHC, the EAB raises its new argument. The EAB argues that because
Irving did not appeal the adverse decision in the matter of her second
job, she is not qualified for benefits in connection with her termination
from UIHC. The gist of the EAB’s argument is that if an employee is
disqualified from receiving unemployment benefits as a result of
termination from concurrent part-time employment, the disqualification
also applies with respect to eligibility for unemployment benefits from the
loss of the other job, regardless of the nature of termination from that
position. A shorthand description of this argument is the “spill-over”
theory. See Glende v. Comm’r of Econ. Sec., 345 N.W.2d 283, 285 (Minn.
6
Ct. App. 1984) (rejecting the notion that a “ ‘spill-over’ taint of
disqualification” requires blanket disqualification for all concurrent forms
of employment). The EAB describes the spill-over argument as a claim
that this action is moot.
The EAB recognizes this argument was not raised before the
agency or the district court in the matter involving disqualification for
unemployment benefits from UIHC. In anticipation of a preservation
issue, the EAB frames its spill-over argument as a claim that Irving’s
current appeal has become moot. The EAB points to the timing of the
decisions. The February 18, 2014 decision of the district court in the
case of Irving’s second job became final only after the district court
entered its decision in the present case on December 18, 2014, with a
notice of appeal filed on January 16, 2015.
In light of this interesting procedural posture, the EAB argues that
Irving will be “disqualified on the same terms no matter how this appeal
turns out.” The EAB suggests, therefore, that in this appeal, Irving
cannot show prejudice arising from the action of the EAB in her
unemployment claim involving UIHC as required by the Iowa
Administrative Procedure Act. Iowa Code § 17A.19(8)(a).
In reply to the EAB’s new argument, Irving does not raise
preservation issues. Instead, she attacks the EAB’s position on the
merits. She claims that her disqualification based on alleged misconduct
from her part-time job should have no bearing on whether she should be
disqualified from receiving unemployment benefits as to her full-time job.
In the alternative, Irving argues that even if the EAB is correct that this
action is moot on a spill-over theory, this court should nonetheless
address the important substantive issues presented in this appeal.
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II. Scope of Review.
“Our review of unemployment benefit cases is governed by the
[Iowa] Administrative Procedure Act, Iowa Code chapter 17A.” Dico, Inc.
v. Iowa Emp’t Appeal Bd., 576 N.W.2d 352, 354 (1998). We elaborated
on our standard of review in Hawkeye Land Company v. Iowa Utilities
Board:
Iowa Code section 17A.19(10) governs judicial review of an
agency ruling. The district court reviews the agency’s
decision in an appellate capacity. In turn, “[w]e review the
district court’s decision to determine whether it correctly
applied the law.” “We must apply the standards set forth in
section 17A.19(10) and determine whether our application of
those standards produce[s] the same result as reached by
the district court.” “The burden of demonstrating the . . .
invalidity of agency action is on the party asserting
invalidity.”
847 N.W.2d 199, 207 (Iowa 2014) (alterations in original) (first quoting
Iowa Med. Soc’y v. Iowa Bd. of Nursing, 831 N.W.2d 826, 838 (Iowa
2013); then quoting Auen v. Alcoholic Beverages Div., 679 N.W.2d 586,
589 (Iowa 2004); and then quoting Iowa Code § 17A.19(8)(a)).
III. Preliminary Issue: Renda Deference.
As a preliminary question, before we consider any of the legal
issues in this case, we must determine whether the EAB is entitled to
deference in its legal interpretations in this case. There are at least three
potential legal issues under Iowa Code section 96.5. The first issue is
whether, as a matter of law, Irving’s incarceration disqualified her from
receiving benefits under the voluntary-quit provision of the statute and
related rules concerning absenteeism. The second legal question is
whether Irving’s incarceration disqualified her from receiving benefits
because it amounted to misconduct under the statute and accompanying
administrative rules. The third legal issue, if it is properly before us, is
whether Irving’s failure to appeal her disqualification for misconduct in
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the matter of her part-time job requires her disqualification from
receiving benefits in this matter under Iowa Code section 96.5(2).
The recent seminal case regarding the degree to which this court
defers to legal interpretations of an administrative agency is Renda v.
Iowa Civil Rights Commission, 784 N.W.2d 8, 10–15 (Iowa 2010). In
Renda, we concluded that we should not afford deference to an agency’s
legal interpretations unless that interpretive authority has clearly been
vested in the agency. Id. at 11. Where there is no express grant of
interpretive authority, we as a general matter do not grant deference to
an agency when the legal terms being construed have independent legal
meaning not within its expertise. Id. at 14. Words and phrases like
“voluntary,” “misconduct,” “employer,” and “in connection with” are not
alien to the legal lexicon. These terms are not complex or beyond the
competency of courts. See SZ Enters., LLC v. Iowa Utils. Bd., 850 N.W.2d
441, 451 (Iowa 2014) (declining to defer to agency interpretation when
the subject matter is not overtly complex and concerns “terms that do
not on their face appear to be technical in nature”); see also Schutjer v.
Algona Manor Care Ctr., 780 N.W.2d 549, 558 (Iowa 2010). Like the
district court, we discern no clear indication in the statute requiring
Renda deference and conclude that we do not defer to the agency’s
interpretation of law.
IV. Dismissal for Misconduct and Disqualification for
Unemployment Insurance Benefits from All Other Concurrent
Employers—The Spill-Over Theory.
A. Procedural Posture. At the outset, we must confront a
somewhat unusual procedural issue. As indicated above, the question of
whether disqualification for misconduct related to concurrent, part-time
employment inexorably leads to disqualification for benefits related to a
9
different full-time job with a different employer under a spill-over theory
was not presented to the agency or the district court and is raised for the
first time on appeal. The disqualification for misconduct related to
Irving’s part-time job did not become final until after the district court
ruled in this case and Irving filed her notice of appeal.
We have repeatedly said in the context of unemployment appeals
that we consider only issues raised in the record before the EAB. Bartelt
v. Emp’t Appeal Bd., 494 N.W.2d 684, 687 (Iowa 1993) (“Disqualification
for benefits stand[s] or fall[s] on the ground asserted before the agency.”);
Sharp v. Emp’t Appeal Bd., 479 N.W.2d 280, 284 (Iowa 1991) (finding
termination for misconduct not raised before the agency and thus “there
is nothing to review”); Roberts v. Iowa Dep’t of Job Serv., 356 N.W.2d 218,
223 (Iowa 1984) (holding that upon judicial review, the district court
reviews final agency action and that “[i]n the absence of the requisite
agency finding, we have nothing to review”). It is undisputed that the
issue of whether disqualification from a part-time job means
disqualification for benefits from a simultaneously held full-time job was
not considered by the EAB and was not part of the appeal to the district
court. Under our precedent, there is a real question whether we can
reach out and decide a new issue presented on appeal for the first time.
See Bartelt, 494 N.W.2d at 687; Sharp, 479 N.W.2d at 284; Roberts, 356
N.W.2d at 223.
There might be some room to consider the issue under the
principles discussed in the concurring and dissenting opinion in Feld v.
Borkowski, 790 N.W.2d 72, 84–85 (Iowa 2010) (Appel, J., concurring in
part and dissenting in part) (discussing when matters not raised by the
parties may properly be considered before the court). The Feld majority
does not explain, however, how to avoid the Bartelt, Sharp, and Roberts
10
precedents in order to reach the underlying issue. Finding an exception
to our precedents might be problematic in the context of an appeal of
final agency action under the Iowa Administrative Procedures Act. Such
an appeal implies a ruling by the agency, not an argument made by
counsel on appeal. It is true, of course, that a challenger to agency
action must generally show prejudice. Iowa Code § 17A.19(8)(a). But
can lack of prejudice be shown by reference to facts and arguments
outside the administrative record?
The procedural snarl presented in this case also has implications
for the underlying merits of the late-raised issue. Even assuming some
spill-over effect, there is a question of timing. Does a disqualification for
misconduct in a part-time job operate to disqualify a claimant from
benefits after a hearing has been held on the merits with respect to
benefits resulting from loss of the simultaneously held full-time job?
The procedural posture in the current case suggests that even if there is
a concept of vicarious disqualification across jobs, the application of
such a rule should relate to terminations which occur only after the
finding of misconduct has become final. Otherwise, retroactive
misconduct disqualification amounts to a penalty or forfeiture of
unemployment benefits where the entitlement to benefits has already
been determined. See Richards v. Unemployment Comp. Bd. of Review,
480 A.2d 1338, 1340 (Pa. Commw. Ct. 1984) (finding “no statutory or
other basis for imposing a penalty” on a claimant’s previously determined
compensation from his full-time employer after his discharge for
misconduct from a part-time employer); see also Faatz v. Unemployment
Comp. Bd. of Review, No. 377 C.D. 2015, 2015 WL 5511319, at *2 & n.3
(Pa. Commw. Ct. Aug. 11, 2015) (noting that the claimant’s misconduct
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discharge from her part-time job would not affect any previously
determined benefits, if she had any).
The EAB suggests that we can consider the issue on appeal even
though the question has not been presented to the district court or to the
agency because mootness may be raised at any time. Mootness,
however, generally applies where there is a lack of a real live controversy
which deprives the court of the ability to provide the parties with a
remedy. Here, there is a real live controversy which plainly has not been
extinguished. The problem does not seem like a mootness issue, but
rather a collateral attack based on a new issue.
The procedural questions are complicated. Instead of sorting
through these complex issues, we turn to the underlying merits to
resolve the issue which has been presented to us and briefed by the
parties.
B. Overview of Spill-Over Disqualification. The EAB asks us to
hold that a final disqualification for misconduct in a claimant’s part-time
employment leads to disqualification of the employee for unemployment
insurance resulting from her termination from her simultaneously held
full-time job regardless (1) of the reasons for termination from the full-
time job and (2) even though the final determination of disqualification
for misconduct on the part-time job occurred after termination from the
full-time job and was not advanced as a reason for disqualification of
benefits related to the claimant’s full-time job in proceedings before the
EAB.
We have not had occasion to consider these questions before. To
do so, we must balance two competing interests. On the one hand, we
have the interest of the person who loses both jobs in this way—the
remedial benefits of unemployment insurance can accomplish much to
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alleviate the misery of a period of unemployment. On the other hand, we
have the interests of the health of the employment insurance fund, all
other people who may draw from the fund, and the employers who
contribute to the fund; allowing those who become unemployed due to
their own fault under the law to draw from the fund would deplete the
fund at the expense of those who were not at fault and would defeat one
of the goals of the law, namely to provide financial incentives to
employers to refrain from terminating employees for disapproved
reasons. See Iowa Code § 96.2 (stating that reducing unemployment can
be accomplished by “encouraging employers to provide more stable
employment”); Katherine Baicker, Claudia Goldin & Lawrence F. Katz, A
Distinctive System: Origins and Impact of U.S. Unemployment
Compensation, in The Defining Moment: The Great Depression and the
American Economy in the Twentieth Century 227, 245–50 (Michael D.
Bordo, Claudia Goldin, & Eugene N. White eds., 1998),
http://nber.org/chapters/c6895 (describing how penalizing employers
for benefits paid to their workers was intended to reduce unemployment
by giving financial incentives to employers to provide stable, as opposed
to seasonal, employment).
C. Iowa Statutory Provisions Related to Misconduct. The key
Iowa statutory provision involved in this issue is Iowa Code section
96.5(2). It provides,
If the department finds that the individual has been
discharged for misconduct in connection with the individual’s
employment:
a. The individual shall be disqualified for benefits
until the individual has worked in and has been paid wages
for insured work equal to ten times the individual’s weekly
benefit amount, provided the individual is otherwise eligible.
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b. Provided further, if gross misconduct is established,
the department shall cancel the individual’s wage credits
earned, prior to the date of discharge, from all employers.
c. Gross misconduct is deemed to have occurred after
a claimant loses employment as a result of an act
constituting an indictable offense in connection with the
claimant’s employment, provided the claimant is duly
convicted thereof or has signed a statement admitting the
commission of such an act.
Id. (emphasis added).
The emphasized portions of the statute show that the legislature
referred to misconduct “in connection with the individual’s employment”
and gross misconduct that cancelled an individual’s wage credits “from
all employers.”
In addition, the EAB has an administrative rule fleshing out the
content of “misconduct” under the Iowa Employment Security Law. Iowa
Admin. Code r. 871—24.32(1)(a). The rule includes within “misconduct”
acts or omissions “arising out of such worker’s contract of employment”;
limits misconduct to acts evincing willful or wanton disregard of “an
employer’s interest”; and includes carelessness or negligence only when
it is of such a degree of recurrence as to show intentional and
substantial disregard “of the employer’s interests” or of the employee’s
duties and obligations “to the employer.” Id. Under the administrative
rules, excessive unexcused absence is considered misconduct except for
illness or “other reasonable grounds.” Id. r. 871—24.32(7).
D. Positions of the Parties. The EAB’s position is that Irving’s
discharge for misconduct from her part-time job serves to disqualify her
from receiving unemployment insurance benefits from her full-time job at
UIHC. The EAB cites Iowa Code section 96.5(2), which states, “If the
department finds that the individual has been discharged for misconduct
in connection with the individual’s employment[,] . . . [t]he individual
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shall be disqualified for benefits . . . .” Nothing in this provision, the EAB
argues, limits the disqualification to the job for which the individual was
discharged for misconduct. Since the disqualification for benefits is not
limited in the statute to one employer, it must be applied to all benefits
from all employers. The EAB states that this rule of “complete
disqualification” has been applied for thirty-six years and is a key
component of the entire system of administration of the unemployment
compensation fund.
Irving disagrees with the EAB’s position. She analogizes the issues
of misconduct and complete disqualification to prior Iowa caselaw on
voluntary quits, wherein the court of appeals held that a voluntary quit
from a part-time employer did not disqualify the individual from benefits
from a full-time employer. Welch v. Iowa Dep’t of Emp’t Servs., 421
N.W.2d 150, 154 (Iowa Ct. App. 1988).
E. Authority from Other States Regarding Spill-Over for
Misconduct. The Iowa Employment Security Law (the Act) was enacted
as part of a national movement arising out of the Great Depression to
provide a measure of financial security to those who were involuntarily
unemployed. All states have enacted such statutes. While the statutes
are not identical in all respects, they are sufficiently similar that this
court has often relied on cases from other jurisdictions to aid in the
interpretation of Iowa law. See, e.g., Harlan v. Iowa Dep’t of Job Serv.,
350 N.W.2d 192, 194 (Iowa 1984); Higgins v. Iowa Dep’t of Job Serv., 350
N.W.2d 187, 191–92 (Iowa 1984); Cosper v. Iowa Dep’t of Job Serv., 321
N.W.2d 6, 10–11 (Iowa 1982); Huntoon v. Iowa Dep’t of Job Serv., 275
N.W.2d 445, 448 (Iowa 1979).
We have found caselaw in four states considering whether a
misconduct discharge with respect to one employer disqualifies an
15
individual from receiving unemployment benefits for other employers. In
each of these states, appellate courts have overturned agency
determinations that disqualification from benefits from one job
necessarily means disqualification of benefits from another job.
We begin with caselaw from Pennsylvania. In Richards, the
Commonwealth Court of Pennsylvania considered a case where an
employee was laid off from a factory job. 480 A.2d at 1339. After the
layoff, the claimant obtained a part-time job at Domino’s Pizza. Id.
Because of the low wages at Domino’s, he continued to receive
unemployment benefits from the factory. Id. The claimant was then
fired from Domino’s for willful misconduct. Id. The question was
whether the termination from Domino’s for misconduct provided a basis
for disqualification from continued benefits from the factory job. Id. The
administrative agency denied continued benefits arising from the
claimant’s factory job. Id.
The Richards court disagreed, holding that the employee’s loss of
employment with Domino’s was irrelevant to his unemployment benefits
from his full-time job. Id. The court held there was no difference
between a voluntary quit and a misconduct discharge for the purposes of
determining whether the employee should be disqualified for benefits
from other jobs. Id. The Richards court held,
[W]e have no statutory or other basis for imposing a penalty
as to regular benefits because of unemployment from a part-
time job which Claimant had a right to keep or lose since the
earnings therein could in no respect affect his entitlement to
regular benefits.
Id. at 1340.
Similar caselaw appears in Minnesota. In Glende, an employee
was simultaneously employed by a full-time employer and a part-time
16
employer. 345 N.W.2d at 284. The employee was terminated for
misconduct from the part-time job and was laid off from his full-time job
a few days later. Id. The Glende court drew an analogy from cases
involving voluntary quits, wherein the Minnesota Supreme Court held
that a voluntary quit from a part-time job could not be a basis for
disqualification for benefits of another job. Id. at 284; see Berzac v.
Marsden Bldg. Maint. Co., 311 N.W.2d 873, 875 (Minn. 1981). Despite
the agency’s mandate to “examine . . . separate claim petitions upon
their individual merits,” Berzac, 311 N.W.2d at 875, the administrative
agency in Glende disqualified the employee for benefits from his full-time
job based on his misconduct termination in his part-time employment.
Glende, 345 N.W.2d at 284.
The Glende court reversed. Glende, 345 N.W.2d at 285. The court
noted that the agency ignored its prior instruction from Berzac and
“repeated its erroneous practice of denying benefits from the full-time
employment by virtue of a ‘spill-over’ taint of disqualification from the
previous part-time employment.” Id.
The approach of the Glende court was approved by the Minnesota
Supreme Court in Sticka v. Holiday Village South, 348 N.W.2d 761, 763
(Minn. 1984). The Sticka court declared that the “all or nothing
proposition” of the Minnesota agency was “misguided.” Id. Although the
case involved a voluntary quit of a part-time job, the Sticka court
declared that “it makes no sense that on cessation of the part-time work
for any reason, [the employee] should become disqualified for any and all
benefits.” Id. (emphasis added).
In support of its approach, the Sticka court cited a Nebraska case,
Gilbert v. Hanlon, 335 N.W.2d 548, 553 (Neb. 1983). Like Sticka, the
case involved a situation where the employee voluntarily quit a part-time
17
job. Id. at 550. The Gilbert court, however, broadly stated that where
more than one job is held concurrently by an employee, “a disqualifying
termination of one job does not thereby automatically disqualify the
employee from benefits based upon other jobs against which no
disqualification applies.” Id. at 553. According to the Gilbert court,
“each job should be considered separately and benefits disqualified
separately according to the facts relating to the termination of each
employment.” Id.
Finally, in Brooks v. Department of Labor & Industrial Relations, the
Hawaii Supreme Court considered whether an employee with
simultaneous full-time and part-time jobs and who was discharged for
misconduct from his part-time job was not eligible for unemployment
compensation from the full-time job when he was discharged from that
job for medical reasons. 704 P.2d 881, 881 (Haw. 1985). The employee
was denied benefits from his full-time job at the administrative stage
because of the earlier misconduct termination. Id. at 882. The court
disagreed, stating that the employee was not unemployed at the time he
was discharged from his full-time job for medical reasons despite being
previously discharged for misconduct from his other job. Id. at 882.
Obviously, these cases are not binding authority in Iowa. They do
show, however, that when the relatively rare spill-over issue has been
presented elsewhere, the state appellate courts have liberally construed
their employment security acts and found in favor of the employee.
F. Iowa Authority on Nexus and Spill-Over. There is no Iowa
authority directly on point regarding the issue of the spill-over effect of a
disqualification for benefits resulting from discharge from a part-time job
for misconduct. Generally, however, we have held that “each individual
case under the unemployment compensation statute must be considered
18
and construed upon the facts as presented.” Moorman Mfg. Co. v. Iowa
Unemployment Comp. Comm’n, 230 Iowa 123, 130–31, 296 N.W. 791,
795 (1941).
Additionally, our courts have heard several cases concerning
whether an employee discharged for voluntarily quitting a part-time job
is then barred from receiving unemployment benefits from a full-time job.
In McCarthy v. Iowa Employment Security Commission, we considered a
case where an employee quit a second, part-time job, before being laid off
from a full-time job. 247 Iowa 760, 762, 76 N.W.2d 201, 202 (1956).
When he applied for unemployment benefits from his full-time job, the
administrative agency found him disqualified because of his previous
voluntary quit. Id. at 762–63, 76 N.W.2d at 203. We disagreed,
reasoning that the Employment Security Law requires employers to pay
into the unemployment fund for their employees and that the only
interest an employer has is in the amount they contributed to the fund
for that employee. Id. at 763, 76 N.W.2d at 203. We stated, “[T]he
termination of the plaintiff’s work with the [part-time employer] should
have no effect upon the [payment] record of his full-time employer.” Id.
We found that fact important in construing the meaning of the phrase
“his work” in Iowa Code section 96.5(1) (1954), noting that the
subsection does not say “all his work.” Id. at 764–65, 76 N.W.2d at 203–
04. In other words, the “work” referred to in section 96.5(1) is in relation
to the employer with the financial interest in that portion of the
employment fund. Importantly, we were unwilling to write in the term
“all” to precede the term “work” in the statute.
In Welch v. Iowa Department of Employment Services, the court of
appeals heard a similar case where an employee left part-time
employment and had trouble securing unemployment compensation for a
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full-time job. 421 N.W.2d 150, 151 (Iowa Ct. App. 1988). The court of
appeals noted that if the full-time employer did not have to pay
unemployment benefits due to the separation from the part-time
employer, that this would result in a “windfall . . . to the regular
employer who did cause claimant’s unemployment because of that
employer’s being relieved of liability.” Id. at 153.
G. Analysis.
1. Principles of statutory construction. We begin with a brief review
of the general principles of statutory construction and the specific rules
of construction that relate to cases under the Iowa Employment Security
Law.
We have stated that the guiding polestar of statutory analysis is to
determine and apply the intent of the legislature. Iowa Dep’t of Revenue
v. Iowa Merit Emp’t Comm’n, 243 N.W.2d 610, 614 (Iowa 1976). If the
words of a statute are “so clear and free from obscurity that [their]
meaning is evident from a mere reading,” that is the end of the matter.
Holiday Inns Franchising, Inc. v. Branstad, 537 N.W.2d 724, 728 (Iowa
1995) (quoting Kruck v. Needles, 259 Iowa 470, 476, 144 N.W.2d 296,
300 (1966)). If a statute is ambiguous, we will then construe the statute
using traditional tools of statutory interpretation. See generally Iowa
Code § 4.6 (2013) (outlining various factors that may be considered in
determining legislative intent).
We have cautioned, however, against overbroad use of the plain-
meaning doctrine. We have stated that courts “should be circumspect
regarding narrow claims of plain meaning and must strive to make sense
of [a statute] as a whole.” Rolfe State Bank v. Gunderson, 794 N.W.2d
561, 564 (Iowa 2011). Ambiguity may arise not only from the meaning of
particular words, but also “from the general scope and meaning of a
20
statute when all its provisions are examined.” Id. (quoting Holiday Inns
Franchising, 537 N.W.2d at 728).
Consistent with our caselaw, the leading treatise on statutory
construction cautions against indiscriminate use of the plain meaning
approach, noting that “invocation of the plain meaning rule may
represent an attempt to reinforce confidence in an interpretation arrived
at on other grounds.” See 2A Norman J. Singer & Shambie Singer,
Sutherland Statutes and Statutory Construction, § 46:1 (7th ed., rev. vol.
2014). The treatise further notes that “it would seem difficult, or
impossible, for courts to determine the meaning of a statutory term or
provision without any contextual consideration.” Id. § 46.4, at 199–200.
We have applied these general principles in the context of the Iowa
Employment Security Law. For instance, in McCarthy, we cautioned that
language that is “plain and unambiguous” in some contexts might not be
so in another. 247 Iowa at 762, 76 N.W.2d at 202. Citing prior
precedent, we emphasized, “Doubtless the language must be construed
in the light both of its context and its purpose.” Id. (citing Stromberg
Hatchery v. Iowa Emp’t Sec. Comm’n, 239 Iowa 1047, 1054, 33 N.W.2d
498, 503 (1948)).
In construing statutes, we often look to the underlying legislative
purpose. See Holiday Inns Franchising, 537 N.W.2d at 728. Particularly
relevant in determining that purpose is a statute’s preamble or statement
of policy. See id.; DeMore ex rel. DeMore v. Dieters, 334 N.W.2d 734, 737
(Iowa 1983). Here, the legislature has provided us with a lengthy
statement of the legislative policy underlying the statute. Iowa Code
section 96.2 provides,
Economic insecurity due to unemployment is a serious
menace to the health, morals, and welfare of the people of
this state. Involuntary unemployment is therefore a subject
21
of general interest and concern which requires appropriate
action by the legislature to prevent its spread and to lighten
its burden which now so often falls with crushing force upon
the unemployed worker and the worker’s family. . . . The
legislature, therefore, declares that in its considered
judgment the public good and the general welfare of the
citizens of this state require the enactment of this measure
. . . for the compulsory setting aside of unemployment
reserves to be used for the benefit of persons unemployed
through no fault of their own.
We have characterized the legislative purpose as including a goal of
“minimizing the burden of involuntary unemployment” and have cited
that purpose in numerous cases interpreting the statute. See Roberts,
356 N.W.2d at 221; see also, e.g., Bridgestone/Firestone, Inc. v. Emp’t
Appeal Bd., 570 N.W.2d 85, 96 (Iowa 1997); Cosper, 321 N.W.2d at 10.
We also look to the entire statute in construing a particular
provision or section. When we interpret a statute, “we assess the statute
in its entirety, not just isolated words or phrases.” In re Estate of
Bockwoldt, 814 N.W.2d 215, 223 (Iowa 2012) (quoting Doe v. Iowa Dep’t
of Human Servs., 786 N.W.2d 853, 858 (Iowa 2010)); accord In re A.J.M.,
847 N.W.2d 601, 605 (Iowa 2014); State v. Romer, 832 N.W.2d 169, 177
(Iowa 2013); State v. Young, 686 N.W.2d 182, 184–85 (Iowa 2004); City of
Nevada v. Slemmons, 244 Iowa 1068, 1071, 59 N.W.2d 793, 794 (1953).
The concept of considering the entire act and construing its various
provisions in that light is well established in our caselaw involving the
Iowa Employment Security Law. See McCarthy, 247 Iowa at 762, 76
N.W.2d at 202; Merchants Supply Co. v. Iowa Emp’t Sec. Comm’n, 235
Iowa 372, 381, 16 N.W.2d 572, 578 (1944); Iowa Public Serv. Co. v.
Rhode, 230 Iowa 751, 753, 298 N.W. 794, 796 (1941).
In addition to the statement of purpose and the general rules of
statutory construction, there are some specific rules that apply to cases
under the Iowa Employment Security Law that have a bearing on our
22
consideration of the statutory issues presented in this case. For
instance, we have stated that in light of the salutary purposes of the Act,
we construe its provisions “liberally to carry out its humane and
beneficial purpose.” Bridgestone/Firestone, 570 N.W.2d at 96; see also
Roberts, 356 N.W.2d at 221; Brumley v. Iowa Dep’t of Job Serv., 292
N.W.2d 126, 129 (Iowa 1980); Smith v. Iowa Emp’t Sec. Comm’n, 212
N.W.2d 471, 472–73 (Iowa 1973). The notion that the Iowa Employment
Security Law is to be liberally construed to carry out its humane and
beneficial purpose is not an arithmetic rule of certain application, but it
does mean that in close cases the benefit of the doubt is in favor of
extending benefits to fulfill the purpose of the Act.
We have said that the claimant has the burden to initially show
qualification for benefits. See Moulton v. Iowa Emp’t Sec. Comm’n, 239
Iowa 1161, 1172, 34 N.W.2d 211, 217 (1948). Under the statute,
however, the employer generally has the burden to show disqualification.
Iowa Code § 96.6(2); see Reigelsberger v. Emp’t Appeal Bd., 500 N.W.2d
64, 66 (Iowa 1993); Bartelt, 494 N.W.2d at 686. Further, we and our
court of appeals have recognized the parallel concept that disqualification
provisions of the statute are subject to narrow or strict construction in
light of the beneficial purposes of the statute. Bridgestone/Firestone,
570 N.W.2d at 96; Diggs v. Emp’t Appeal Bd., 478 N.W.2d 432, 434 (Iowa
Ct. App. 1991); see also Marzetti Frozen Pasta, Inc. v. Emp’t Appeal Bd.,
No. 08–0288, 2008 WL 4725151, at *3 (Iowa Ct. App. Oct. 29, 2008).
2. Application of principles to the spill-over theory. The statutory
language is at least ambiguous on the question of whether a
disqualification for misconduct from one employer means a
disqualification for all employers. See Iowa Code § 96.5(2). Nothing in
this Code provision expressly indicates whether a disqualification for
23
misconduct from one employer means disqualification from benefits from
any other employer. In considering the issue, we must keep in mind the
beneficial purposes of the Act, our precedent that the employer has the
burden of proof regarding misconduct, and our precedent that the
disqualification provisions of the Act are to be strictly construed against
the employer. Bridgestone/Firestone, 570 N.W.2d at 96; Reigelsberger,
500 N.W.2d at 66.
Examination of the statute suggests that the disqualification for
misconduct should apply only to the employment where the misconduct
occurred. The introductory language of Iowa Code section 96.5(2) states
that disqualification for misconduct must be “in connection with the
individual’s employment.” This statutory language suggests that there
must be a causal connection between the misconduct and the
employment. See State ex rel. Miller v. Cutty’s Des Moines Camping Club,
Inc., 694 N.W.2d 518, 525–27 (Iowa 2005) (citing cases for the
proposition that in the absence of a legislative definition, the phrase “in
connection with” is commonly defined as “related to, linked to, or
associated with”).
There is, however, no nexus between a disqualification for
misconduct from one employer and an employee’s other job on which the
misconduct has no bearing. To impose a spill-over or vicarious
disqualification to a loss of employment with a full-time employer based
on misconduct in connection with a part-time employer ignores the
legislature’s required nexus and seems more akin to imposition of a
penalty or moral judgment than interpretation of the statute. But
unemployment benefits are not paid primarily to reward or punish the
employer or employee; they are instead intended to protect the stability
of the state and the family. See Nat’l Gypsum Co. v. Adm’r, La. Dep’t of
24
Emp’t Sec., 313 So. 2d 230, 232 (La. 1975); Turner v. Brown, 134 So. 2d
384, 386 (La. Ct. App. 1961); cf. Richards, 480 A.2d at 1340.
The language in the administrative rule related to misconduct
appears to recognize the concept of a nexus with a specific employer.
The rule defines misconduct as a deliberate act or omission arising “out
of such worker’s contract of employment.” Iowa Admin. Code r. 871—
24.32(1)(a). Where there are two employers, of course, there are two
separate contracts of employment. But the rule seems to link the
misconduct to a contract.
Further, the rule refers to “willful or wanton disregard of an
employer’s interest,” deliberate disregard of the “standards of behavior
which the employer has the right to expect,” “intentional and substantial
disregard of the employer’s interest,” and the “duties and obligations to
the employer.” Id. (emphasis added). Such language in the
administrative rule may not be determinative, but it tends to reinforce
the common sense notion that misconduct is an employer specific
concept.
Further, the statute demonstrates that the legislature knew how to
use language that covers “all employers.” Section 96.5(2)(b) provides that
“if gross misconduct is established, the department shall cancel the
individual’s wage credits earned, prior to the date of discharge, from all
employers.” Iowa Code § 96.5 (2)(b) (emphasis added). While the
legislature used such language in subsection (2), paragraph (b), it did not
use similar language in the adjacent paragraph (a). We should recognize
the difference in adjacent statutory provisions, not ignore it. See Alli v.
Decker, 650 F.3d 1007, 1016 (3rd Cir. 2011) (noting overreliance on
dictionaries “to the exclusion of sources such as adjacent statutory
provisions” can lead courts astray); Davine v. Kapasi, 729 F. Supp. 2d
25
1024, 1027–28 (N.D. Ill. 2010) (noting difference between adjacent
statutory provisions); Bray v. Tejas Toyota, Inc., 363 S.W.3d 777, 785
(Tex. App. 2012) (noting importance of difference in adjacent statutory
language).
There is good reason for the adjacent statutory distinction between
misconduct and gross misconduct. An employee who commits
misconduct with one employer may be performing satisfactorily with
another employer. As noted by an academic commentary, “Identical
conduct might be treated as [misconduct] in one environment and not in
another. One plant will have established rules for employee conduct
which will not exist at another work location.” Paul H. Sanders,
Disqualification for Unemployment Insurance, 8 Vand. L. Rev. 307, 335
(1955).
The Iowa case Cook v. Iowa Department of Job Service illustrates
the fact that misconduct with respect to one employer may not
necessarily be misconduct toward another. 299 N.W.2d 698, 702 (Iowa
1980). In Cook, the claimant was employed in a position that required a
driver’s license in order to deliver groceries. Id. at 699. The claimant
received numerous speeding citations. Id. Ultimately, the employer
received notice from its insurance carrier that it would no longer cover
the claimant due to his poor driving record. Id. at 700. Not having other
suitable positions for the claimant, the employer terminated him. Id. We
held that since the claimant’s predicament was a result of “self-inflicted
uninsurability,” such conduct amounted to disqualifying misconduct. Id.
at 702.
Yet suppose the claimant in Cook was disqualified from a part-time
pizza delivery job when he concurrently held a full-time highly skilled job
that did not require a driver’s license. Assume further that the claimant
26
had a spotless employment record in the full-time position. Under this
scenario, it does not make sense to automatically disqualify the employee
should he or she become unemployed from the full-time job under some
kind of spill-over theory.
A different scenario arises, however, when disqualification results
from gross misconduct. Gross misconduct involves very serious offenses
that would lead any employer to question the desirability of ongoing
employment regardless of whether the conviction was in connection with
the worker’s employment. To provide a harsher treatment of gross
misconduct compared to ordinary misconduct is certainly a rational
legislative policy. See, e.g., Johnson v. So Others Might Eat, Inc., 53 A.3d
323, 326–27 (D.C. 2012) (noting different consequences for gross
misconduct and misconduct). And it is consistent with the legislative
language canceling wage credits earned “from all employers.” Iowa Code
§ 96.5(2)(b).
We further think the reasoning of McCarthy and Welch is
instructive. Section 96.5(1) dealing with voluntary quits and section
96.5(2) dealing with misconduct use slightly different language to refer to
the individual’s job—“left work voluntarily” versus “discharged for
misconduct in connection with the individual’s employment.” Iowa Code
§ 96.5(1), (2). Yet in McCarthy, we refused to judicially add the term “all”
before the term “work.” 76 N.W.2d at 203–04. We decline to add the
term “all” here as well, particularly when the legislature in fact used a
more inclusive term “all employers” in the subsection immediately
following the statutory provision in question here. This plain vanilla,
button-down approach to statutory interpretation is also consistent with
our nexus approach in Moorman Manufacturing, where we required that
each individual case of unemployment compensation be considered and
27
construed on the facts as presented. 230 Iowa at 130–31, 296 N.W. at
795.
Additionally, the purpose of financially penalizing employers for
discharging employees for unapproved reasons is to encourage those
employers to keep employees. That purpose would be negated by giving
an employer a windfall as described in Welch. 421 N.W.2d at 153. Here,
if an employer discharges a full-time employee without a voluntary quit
or misconduct, the employer would get the kind of windfall we rejected in
Welch.
Finally, we find the cases in other states of at least some value.
See Brooks, 704 P.2d at 882; Glende, 345 N.W.2d at 285; Richards, 480
A.2d at 1340. These cases are somewhat conclusory, but they
demonstrate that whatever else might be said, there is at least a solid
basis in the caselaw to limit the effects of a discharge for misconduct to
eligibility for unemployment insurance arising out of that employment.
Our Iowa law directs us to narrowly consider provisions for
disqualification for benefits. Bridgestone/Firestone, 570 N.W.2d at 96.
We must do so in this case.
H. Conclusion. Because of the liberal purposes of the Act, the
requirement that we narrowly construe provisions related to
disqualification, the actual language of the Act and its implementing
regulations, our past precedents, and the persuasive precedents from
other states, we hold that Irving’s challenge to her denial of
unemployment benefits from UIHC should not be barred by the
unappealed determination that she was terminated for misconduct from
her part-time job. We conclude that the contention of the EAB is in
violation of Iowa Code section 96.5(2) and the implementing regulations
found in Iowa Administrative Code rule 871—24.32(1)(a). As a result,
28
the agency position is a violation of law contrary to Iowa Code section
17A.19(10)(b).
V. Excessive Absence as a Result of Incarceration as
Disqualifying Misconduct.
A. Introduction. This case presents the question of whether
Irving’s absence from work as a result of incarceration is misconduct
that disqualifies her from receiving unemployment benefits. The issue is
not the distinctly different question of whether Irving may be lawfully
terminated from employment for excessive absenteeism, but only
whether under the facts and circumstances of this case, Irving is not
entitled to receive unemployment benefits after such termination under
the Iowa Employment Security Law. See Brown v. Iowa Dep’t of Job
Serv., 367 N.W.2d 305, 306 (Iowa Ct. App. 1985); Newman v. Iowa Dep’t
of Job Serv., 351 N.W.2d 806, 808 (Iowa Ct. App. 1984).
The standard an employer must meet to sustain disqualification
for unemployment benefits is more demanding than the standard
ordinarily required to support a termination of employment for just
cause. In the context of disqualification for unemployment benefits
based on misconduct, the question is whether the employee engaged in a
“deliberate act or omission,” conduct “evincing such willful or wanton
disregard of an employer’s interest as is found in deliberate violation or
disregard of standards of behavior which the employer has the right to
expect of employees,” or conduct with “carelessness or negligence of such
degree of recurrence as to manifest equal culpability.” See Iowa Admin.
Code r. 871—24.32(1)(a). In a wrongful termination context, the plaintiff
ordinarily must show a lack of a “legitimate business reason” for the
separation, a much different standard. Rivera v. Woodward Resource
Ctr., 865 N.W.2d 887, 898–99 (Iowa 2015). The apples of disqualification
29
for unemployment benefits should not be conflated with the oranges of
just-cause terminations.
B. Applicable Iowa Rules and Statutes Regarding Misconduct
and Absenteeism. The Iowa Employment Security Law statute states
that “if the department finds that the individual has been discharged for
misconduct in connection with the individual’s employment,” the
individual may be disqualified from receiving unemployment benefits.
Iowa Code § 96.5(2). The statute does not provide a definition of
misconduct.
Iowa Code section 96.6(2) also has provisions related to the
allocation of the burden of proof. The statute provides that generally the
employer has the burden of proving that the claimant is disqualified from
benefits. Id. § 96.2(2). There are no exceptions in the statute for shifting
the burden of proof related to misconduct.
The rules promulgated by the EAB, however, do include a
definition of misconduct. A full understanding of the elaborate and
detailed definition of misconduct is essential to successfully navigating a
dispute regarding disqualification for unemployment benefits on that
basis. Misconduct is defined as
a deliberate act or omission by a worker which constitutes a
material breach of the duties and obligations arising out of
such worker’s contract of employment. Misconduct as the
term is used in the disqualification provision as being limited
to conduct evincing such willful or wanton disregard of an
employer’s interest as is found in deliberate violation or
disregard of standards of behavior which the employer has
the right to expect of employees, or in carelessness or
negligence of such degree of recurrence as to manifest equal
culpability, wrongful intent or evil design, or to show an
intentional and substantial disregard of the employer’s
interests or of the employee’s duties and obligations to the
employer. On the other hand mere inefficiency,
unsatisfactory conduct, failure in good performance as the
result of inability or incapacity, inadvertencies or ordinary
negligence in isolated instances, or good faith errors in
30
judgment or discretion are not to be deemed misconduct
within the meaning of the statute.
Iowa Admin. Code r. 871—24.32(1)(a).
The rule also contains language related to unexcused absenteeism:
Excessive unexcused absenteeism is an intentional disregard
of the duty owed by the claimant to the employer and shall
be considered misconduct except for illness or other
reasonable grounds for which the employee was absent and
that were properly reported to the employer.
Id. r. 871—24.32(7).
C. Positions of the Parties. The EAB notes that under Iowa
Code section 17A.19(7), the role of this court is appellate in nature. The
EAB cites the agency rule related to absenteeism stating that “excessive
unexcused absences is an intentional disregard of the duty owed by the
claimant to the employer.” Id. According to the EAB, the evidence at the
hearing showed the claimant was in jail for nearly a month and missed
at least sixteen consecutive days of work in a single month. It claims
that her incarceration amounted to “absenteeism arising from matters of
purely personal responsibilities” and that the absences are thus not
excused. See Harlan, 350 N.W.2d at 194. The EAB recognizes that the
claimant asserted she was unable to make bail. The EAB sees the
claimant’s failure to make bail as simply a matter of personal
responsibility that does not affect her obligation to arrive at work.
Irving responds that she is not disqualified from benefits due to
misconduct. She emphasizes our caselaw states that “misconduct
connotes volition.” Huntoon, 275 N.W.2d at 448. While she recognizes
absences may amount to misconduct, she asserts such absences must
be both excessive and unexcused. Sallis v. Emp’t Appeal Bd., 437
N.W.2d 895, 897 (Iowa 1989). Irving concedes that absences due to
“matters of purely personal responsibilities” are not excused absences.
31
Harlan, 350 N.W.2d at 194; Higgins, 350 N.W.2d at 191. She
distinguishes these cases, however, arguing that in each of them there
was a pattern of persistent absences that amounted to an intentional act
or omission sufficient to support a misconduct discharge. She contrasts
the “personal responsibilities” cases with Roberts, 356 N.W.2d at 220. In
Roberts, an employee was absent without notice for three days after
being hospitalized for a serious mental impairment. Id. Irving argues
that in Roberts, the court found that the claimant did not commit
misconduct because her conduct was “not volitional, but the result of
inability or incapacity.”
Irving stresses that she was not guilty of the offenses for which she
was incarcerated and that as a result, her absence cannot be considered
volitional. She argues it was not foreseeable that she would be arrested
for a crime for which she was not guilty. From the premise that the
employer must prove volition, Irving argues there was no evidence in the
record to support such a determination and that as a result, the agency’s
determination was not supported by substantial evidence. See Iowa
Code § 17A.19(10)(f).
D. Authorities from Other States Regarding Absence Due to
Incarceration as Misconduct. Many employment security statutes, like
Iowa’s, have open-ended statutory provisions providing for
disqualification from receipt of unemployment benefits for employee
misconduct. The seminal case defining what constitutes misconduct for
purposes of disqualification from receiving unemployment benefits is
Boynton Cab Co. v. Neubeck, 296 N.W. 636, 640 (Wis. 1941). That case
established a standard of misconduct that was closely tracked in the
Iowa administrative rule. Compare id., with Iowa Admin. Code r. 871—
24.32(1)(a). We repeatedly have said the Boynton standard—as reflected
32
in Iowa’s administrative rules— accurately reflects the intent of the Iowa
legislature. Freeland v. Emp’t Appeal Bd., 492 N.W.2d 193, 196 (Iowa
1992); Sallis, 437 N.W.2d at 896–97; Huntoon, 275 N.W.2d at 447–48.
The Boynton standard for misconduct disqualification is generally
thought to be quite demanding. It certainly exceeds the standard
required in most cases for just-cause termination from employment. A
handful of states have chafed under the rule and promulgated statutes
or regulations departing from it. See, e.g., Ariz. Rev. Stat. Ann. § 23-
775(2) (2016) (disqualifying employees from benefits for “willful or
negligent misconduct”) (emphasis added)); Minn. Stat. § 268.095, subdiv.
6 (including within the definition of misconduct “any intentional,
negligent, or indifferent conduct” (emphasis added)).
The Boynton standard has been applied by state courts in a
number of cases involving absence from work due to incarceration. For
example, in In re Benjamin, 572 N.Y.S.2d 970, 971 (App. Div. 1991) (per
curiam), the court considered whether an employee who was arrested on
drug charges but unable to make bail had committed a willful or
deliberate act sufficient to support disqualification from employment
benefits based on misconduct. The court noted that the defendant made
every effort to obtain funds necessary to post bail and as a result, the
failure to make bail was not a willful or deliberate act upon which a
finding of misconduct could have been predicated. Id. at 971–72.
The Benjamin court also considered whether the drug arrest on the
drug possession charge supported a finding of misconduct. Id. at 972.
The record showed that the charge was ultimately dismissed and there
was no evidence in the record to suggest that the claimant was in fact
involved in any drug related activity. Id. The court ruled the possession
charge alone could not constitute misconduct, noting that to hold
33
otherwise would give rise to an implication that “willfulness has come to
mean being in the wrong place at the wrong time.” Id. Further, the
court noted that such a holding “would establish a dangerous precedent,
i.e., that disqualifying conduct may be predicated on a mere arrest
unsupported by a conviction.” Id. While there was also an underlying
disorderly conduct charge, the court noted that this charge was not the
basis of the employee’s pretrial incarceration and thus could not
establish misconduct. Id.
A similar result was reached by the Supreme Court of Nevada in
the divided decision of State v. Evans, 901 P.2d 156, 156–57 (Nev. 1995).
In that case, the claimant was arrested and lost her job because she was
forced to remain in jail pending trial and could not afford bail. The
Nevada court noted that neither her pretrial incarceration nor her
criminal acts were related to her employment. Id. at 156. Further, the
court emphasized that Evans’s failure to be available for work was
predicated on her inability to obtain bail, not her criminal conduct. Id.
As a result, the claimant was not guilty of misconduct or any deliberate
violation or disregard of standards of behavior which her employer has
the right to expect. Id. at 156–57.
The Minnesota Supreme Court has considered issues related to
misconduct arising from incarceration in a series of cases. In Grushus v.
Minnesota Mining & Manufacturing Co., the Minnesota Supreme Court
found that an employee’s incarceration under the facts of the case
amounted to misconduct sufficient to disqualify the employee from
receiving unemployment benefits. 100 N.W.2d 516, 520 (Minn. 1960).
The Grushus court, however, declined to adopt a rule that absenteeism
resulting from incarceration was misconduct as a matter of law. Id. at
34
519. Instead, the court emphasized that whether a disqualifying event
occurred depended upon the facts of each particular case. Id.
After Grushus, the Minnesota Supreme Court revisited the
question of whether incarceration amounted to disqualifying misconduct
in Jenkins v. American Express Financial Corp., 721 N.W.2d 286, 288
(Minn. 2006). In Jenkins, the employee insurance specialist was
convicted of assaulting a nurse while being treated for a broken ankle.
Id. She was sentenced to thirty days in jail with work release privileges.
Id. Her employer informed her that she would be able to maintain her
employment while on work release. Id. The employer, however, refused
to confirm her employment with work release officials and, as a result,
the employee was not able to report to work. Id. The employer then fired
the employee for failure to report to work. Id. The claimant sought
unemployment benefits, but the administrative agency determined that
she had been terminated for misconduct as a result of her incarceration.
Id. at 288–89. The Minnesota Court of Appeals affirmed, noting that the
claimant “engaged in the behavior that led to her incarceration.” Id. at
289.
On appeal, the Minnesota Supreme Court recognized that
incarceration following a conviction of a crime may be misconduct
sufficient to deny benefits, but such a conclusion depended upon the
facts and circumstances of the case. Id. at 290. The Jenkins court
concluded under the facts, misconduct had not been shown. Id. at 291.
The court distinguished prior Minnesota cases upholding
disqualifications for misconduct where a claimant was incarcerated,
noting in the prior cases, the claimants either failed to contact their
employer until after work was missed or engaged in deception concerning
the reasons for the claimant’s inability to return to work. Id. On the
 35
other hand, the court recognized that a period of incarceration under
appropriate circumstances may be evidence that an employee lacked
concern about his or her employment. Id.
The failure to notify the employer of absence as a result of
incarceration was emphasized by the Missouri Court of Appeals in Moore
v. Swisher Mower & Machine Co., 49 S.W.3d 731, 739–40 (Mo. Ct. App.
2001). The claimant boxer and assembler was incarcerated on a charge
of assault. Id. at 734. He was unable to post bail and remained
incarcerated for several months. Id. The employer discharged him for
failing to attend work or to report his absence. Id. Ultimately, the
charges were dropped. Id. Upon his release, the claimant filed for
unemployment. Id.
The Moore court rejected the notion that the claimant voluntarily
quit his employment. Id. at 739. Yet the court noted that the claimant
was fired for violating the employer’s policy requiring employees to call in
and report days when they needed to be absent from work. Id. The
Moore court emphasized that failure to properly report absences
according to an employer’s reasonable policy amounts to a deliberate
violation of employer rules and ultimately disqualifying misconduct. Id.
at 740.
E. Iowa Caselaw on Misconduct Arising from Absenteeism. As
noted above, the Iowa administrative rule defining misconduct closely
parallels the Boynton standard. We have stated that the language in the
rule fairly reflects the intention of the legislature. Cosper, 321 N.W.2d at
9. “Misconduct connotes volition. A failure in good performance which
results from inability or incapacity is not volitional and is thus not
misconduct.” Huntoon, 275 N.W.2d at 448.
36
In Cosper, we considered a case where the claimant had a history
of absences. 321 N.W.2d at 6. The claimant was warned by her
employer repeatedly about her absences. Id. at 7. Ultimately, her
employer terminated her. Id. The agency determined she was
terminated for misconduct, a conclusion upheld by the district court. Id.
at 7–8.
In Cosper, the administrative agency adopted a rule regarding
excessive absenteeism which stated that “[e]xcessive absenteeism is an
intentional disregard of the duty owed by the claimant to the employer
and shall be considered misconduct.” Id. at 9. Notably, the rule did not
distinguish between excused and unexcused absences. See id.
We took exception to the agency’s broad absenteeism rule. Id. at
10. We observed that, contrary to the Iowa administrative rule, the
general approach in the caselaw was that mere absenteeism is not a
consequence that amounts to disqualifying misconduct under
unemployment insurance statutes. Id. Noting that we were not bound to
follow the department’s interpretation of the law, we declared that we did
not approve the absenteeism rule interpreting misconduct “because it
draws no distinction between excused and unexcused absences.” Id.
Stressing that the Iowa Employment Security Law should be interpreted
liberally to achieve the legislative goal of minimizing the burden of
unemployment, we held that excessive absences are not misconduct
unless they are unexcused. Id. Because it was not clear whether the
district court or the agency found the absences unexcused, we remanded
the case to the district court for remand to the agency to make necessary
findings. Id. at 10–11.
Two years later, we considered another absenteeism issue in
Higgins, 350 N.W.2d at 188. In Higgins, a rewrap clerk was absent or
37
late fourteen times during a six-month period. Id. at 189. During this
time frame, the employee was placed on probation and warned to “be on
time every day in the future” to avoid disciplinary action. Id. After the
warning, the claimant was again late because she overslept. Id. The
employer terminated her for excessive absenteeism. Id.
We upheld a determination of the agency that the absences
amounted to disqualifying misconduct. Id. at 192. Significantly, the
agency had amended its rule after our disapproval of its earlier version in
Cosper. Id. at 190. The new version of the rule, which remains in effect
today, provided,
Excessive unexcused absenteeism is an intentional disregard
of the duty owed by the claimant to the employer and shall
be considered misconduct except for illness or other
reasonable grounds for which the employee was absent and
that were properly reported to the employer.
Id. (emphasis omitted); see Iowa Admin. Code r. 871—24.32(7). Thus,
under the new version of the rule, absenteeism due to illness or other
factors that were properly reported to the employer were not grounds for
a misconduct disqualification. The record revealed “seven instances of
absenteeism resulting from personal problems or predicaments[,] . . .
includ[ing] oversleeping, delays caused by tardy babysitters, car trouble,
and no excuse.” Higgins, 350 N.W.2d at 191. Under the facts presented
in Higgins, we concluded that substantial evidence supported a finding of
misconduct based upon excessive unexcused absenteeism. Id. at 192;
see also Harlan, 350 N.W.2d at 192 (“Habitual tardiness or absenteeism
arising from matters of purely personal responsibilities such as
transportation can constitute unexcusable misconduct.”).
We explored the question of what absences might be excusable for
purposes of determining misconduct disqualification for absenteeism in
38
Roberts, 356 N.W.2d at 222. In that case, a merchandise office clerk
called in indicating she had a cold and would not be in to work that day
and “maybe several days.” Id. at 219. She did not call into the office on
two succeeding days when she stayed home for illness. Id. When she
returned to work, she was given a warning notice and was suspended for
two days for unreported absence. Id. Shortly thereafter, the claimant
was admitted to Broadlawns Medical Center for treatment of a condition
diagnosed as schizophrenia, paranoid type. Id. at 219–20. For two days,
the claimant was taking medication that affected her memory. Id. at
220. Her physician testified that she was “unable [to] protect her own
interests at that time, in particular, she was unable to call her employer
each day to report her absence.” Id.
We rejected the employer’s position that the absences amounted to
misconduct. Id. at 222. We held that the first round of absences could
not be considered an “intentional disregard of her duty” to her employer.
Id. We further held that with respect to her hospitalization, the record
established as a matter of law that she was unable to protect her own
interest due to her medication and illness. Id. We emphasized that
under Iowa law, misconduct connotes volition. Id. We concluded that
the claimant’s absence and failure to report due to illness did not
amount to disqualifying misconduct. Id.
Finally, in Sallis, a part-time dishwasher experienced car troubles
and could not get to work. 437 N.W.2d at 895. He called a supervisor,
who told him to call back later and advise them about the situation. Id.
The claimant did not call back. Id. When asked why he did not call
back, the employee declared that he was more concerned about his car
than his job. Id. After this conversation, the manager decided to fire the
claimant. Id. at 896. The agency concluded that the failure of the
39
claimant to call his employer back established a willful and wanton
disregard of the employer’s interests. Id.
We reversed, holding that the facts were insufficient to meet the
demanding standard of misconduct. Id. at 897. We noted that the
jurisdictions were divided on the question of whether a single act could
arise to misconduct. Id. We held that whether or not misconduct was
present depended upon all the underlying facts and circumstances. Id.
F. Analysis. As with the other issues in this case, the general
and specific rules outlined earlier in this opinion apply. In considering
what amounts to misconduct under the statute and administrative rules,
we must (1) liberally construe the statute in light of its policy goals, see
Bridgestone/Firestone, 570 N.W.2d at 96; (2) place the burden of proof of
showing disqualification on the employer, see Bartelt, 494 N.W.2d at 686;
and (3) narrowly interpret any statutory provision related to
disqualification, see Bridgestone/Firestone, 570 N.W.2d at 96.
At the outset, it is important to reiterate that in Iowa, misconduct
for purposes of unemployment insurance is not the same as misconduct
for purposes of termination by an employer. See Lee v. Emp’t Appeal Bd.,
616 N.W.2d 661, 665 (Iowa 2000) (“Misconduct serious enough to
warrant the discharge of an employee is not necessarily serious enough
to warrant a denial of benefits.” (Quoting Reigelsberger, 500 N.W.2d at
66.)). The Iowa approach distinguishing misconduct for purposes of
unemployment benefits from just-cause termination of employment is
consistent with the law of many jurisdictions. See, e.g., Manning v.
Alaska R.R., 853 P.2d 1120, 1125 (Alaska 1993) (differentiating
misconduct for unemployment purposes from just cause for termination);
Weller v. Ariz. Dep’t of Econ. Sec., 860 P.2d 487, 490 (Ariz. Ct. App. 1993)
(noting misconduct for purposes of termination and misconduct for
40
purposes of employee benefits are “two distinct concepts”); Johnson, 53
A.3d at 326–27 (“In determining whether an employee has engaged in
disqualifying misconduct, [we] cannot simply inquire whether the
employer was justified in his decision to discharge the employee.”
(Quoting Jadallah v. D.C. Dep’t of Emp’t Servs., 476 A.2d 671, 675 (D.C.
1984).)); Spink v. Unemployment Appeals Comm’n, 798 So. 2d 899, 901–
02 (Fla. Dist. Ct. App. 2001) (distinguishing between acts of misconduct
justifying termination and those disqualifying employee from
unemployment benefits); Holmes v. Review Bd. of Ind. Emp’t Sec. Div.,
451 N.E.2d 83, 87–88 (Ind. Ct. App. 1983); Hunt v. Gen. Elec. Co., 444
N.Y.S.2d 492, 493 (App. Div. 1981). These cases demonstrate that for
purposes of unemployment insurance, “misconduct” is a term of art that
is ordinarily implemented in accompanying administrative regulations.
Thus, while the employer here argued before the agency that Irving
violated its employment policies, this is a different issue from whether
Irving is disqualified for misconduct for purposes of unemployment
insurance benefits.
With respect to misconduct in the specific context of
unemployment insurance benefits, our statute is nearly identical to that
interpreted by the Boynton court. The decision of the Boynton court,
which established a demanding standard for misconduct that has been
cited widely in unemployment insurance cases across the country, was
powered by the beneficial purpose of the statute, which the court noted
was “to cushion the effect of unemployment by a series of benefit
payments.” Boynton, 296 N.W. at 639; see also Bridgestone/Firestone,
570 N.W.2d at 96; Roberts, 356 N.W.2d at 221.
As noted above, the Boynton standard for misconduct was
incorporated virtually verbatim in rule 871—24.32(1)(a) and by our
41
caselaw. Under the Iowa Boynton-type standard for misconduct, a
claimant must have committed “a deliberate act or omission” which
breaches their duties as an employee. Iowa Admin. Code r. 871—
24.32(1)(a). Under the rule, an employee must engage in “willful or
wanton disregard” of the employer’s interest or “carelessness or
negligence of such degree of recurrence” as to allow the inference of
equally intentional disregard. Id. “[I]nability or incapacity,
inadvertencies or ordinary negligence in isolated instances, or good faith
errors in judgment or discretion” are not misconduct. Id.
We have little trouble concluding that the EAB failed to establish
misconduct under the demanding Boynton standards in this case. We
recognize that in some instances, conduct leading to incarceration may
be so egregious and incarceration interfering with employment so
predictable that an employer may establish willful or wanton disregard of
its interests. We further recognize that failure to inform the employer of
the incarceration, particularly over extended periods of time, may
amount to misconduct. Yet the meaning of Cosper is that it is not
enough for absences to be excessive; they must also be unexcused. See
Cosper, 321 N.W.2d at 10. Indeed, the rule itself requires absences be
unexcused if they are to constitute misconduct. Iowa Admin. Code r.
871—24.32(7).
The problem with the EAB’s position is that it ignores the clear
limitations on misconduct under the statute and its implementing
regulations. We have repeatedly declared that misconduct requires
volition or its statutory equivalent. See Roberts, 356 N.W.2d at 222;
Huntoon, 275 N.W.2d at 448. As quoted above, the key language is,
“Misconduct connotes volition. A failure in good performance which
42
results from inability or incapacity is not volitional and is not
misconduct.” Huntoon, 275 N.W.2d at 448.
Interestingly, in Cosper, we rejected an argument very similar to
that advanced by the EAB here. See 321 N.W.2d at 10. In Cosper, the
agency attempted to enforce an administrative rule that declared
absences were automatically considered a voluntary quit. Id. at 9. We
rejected that argument, noting a voluntary quit does not arise from
absences that were excused. Id. at 10. Cosper stands for the proposition
that overbroad per se rules related to disqualification due to absence are
inconsistent with the statute. Now, under the guise of misconduct, the
EAB is attempting to achieve the same result.
Our post-Cosper cases demonstrate this court’s adherence to its
principal holding. In Roberts, we rejected the notion that hospitalization
for mental illness and the inability to report the absence due to
incapacitation amounted to misconduct. 356 N.W.2d at 222. Just as we
did not consider hospitalization due to mental illness a consequence of
failure of personal responsibility, in Roberts, we do not think the record
here supports a finding of misconduct where the claimant was absent
due to incarceration, where the charge was later dropped, and where the
claimant made arrangements to have her mother contact her employer
on a daily basis until instructed not to do so. 1
1For cases in other jurisdictions coming to similar results, see, for example,
Magma Copper Co. v. Arizona Department of Economic Security, 625 P.2d 935, 937 (Ariz.
Ct. App. 1981) (holding employer has the burden of proving incarceration rose to level of
misconduct necessary to disqualify from benefits); Baldor Electric Co. v. Arkansas
Employment Security Department, 27 S.W.3d 771, 774 (Ark. Ct. App. 2000) (allowing
benefits notwithstanding incarceration); Holmes, 451 N.E.2d at 87–88 (holding
incarceration without conviction may be good cause for termination but does not
preclude an employee from receiving benefits); City of Monroe v. Tolliver, 954 So. 2d 203,
206–07 (La. Ct. App. 2007) (holding incarceration did not constitute willful violation of
attendance policy); and Barker v. Employment Security Department of the State of
Washington, 112 P.3d 536, 539 (Wash. Ct. App. 2005) (holding a finding of misconduct
43
We think the personal-misconduct cases are plainly
distinguishable from the present situation. For example, in Higgins, we
recognized that absences must be not only excessive, but also
unexcused. 350 N.W.2d at 191. The kind of repeated, habitual behavior
considered in that case may be misconduct under the applicable rule
because it shows “carelessness or negligence of such degree of
recurrence as to manifest equal culpability, wrongful intent or evil
design, or . . . show[s] an intentional and substantial disregard of the
employer’s interests.” Iowa Admin. Code r. 871—24.32(1)(a). The record
here simply does not contain such disdain for the employer’s interests.
We further find that involuntary incarceration, at least where the
charges are dismissed, also falls within the “other reasonable grounds”
for absence contemplated under rule 871—24.32(7). Like illness,
absences due to incarceration are involuntary. In this case, the employer
failed to show that Irving could be disqualified under section 24.32(7).
Sallis, 437 N.W.2d at 896 (holding employer has burden of showing
disqualifying misconduct).
We emphasize, as we have done earlier, that our conclusion that
the record does not support a disqualification for unemployment benefits
does not necessarily mean the employer could not lawfully terminate
Irving’s employment. Nevertheless, there was not substantial evidence in
the record to support Irving’s disqualification from benefits on grounds of
misconduct. See Iowa Code § 17A.19(10)(f).
___________________
is not supported by incarceration for violation of a no-contact order of which employee
was not aware).
44
VI. Absence from Employment Due to Incarceration for
Criminal Charges Ultimately Dismissed as a Voluntary Quit.
A. Introduction. This case presents one final issue. The precise
question raised is whether involuntary incarceration that causes absence
from work presents an irrebuttable presumption of disqualification of
eligibility for unemployment benefits because, as a matter of law, such
incarceration results in a voluntary quit. Once again, the distinctly
different question of whether incarceration provides the basis for a lawful
termination of employment is not before us.
B. Iowa Statutory Provisions and Administrative Rules
Related to Misconduct and Voluntary Quits. The key provision of law
at issue here is Iowa Code section 96.5, which provides that employees
are disqualified for unemployment benefits if they have left work
“voluntarily without good cause attributable to the individual’s
employer.” Iowa Code § 96.5(1).
The statute does not provide further elaboration of what is meant
by the term “voluntarily.” Iowa Workforce Development, however, has
promulgated a rule, which provides, “[T]he following reasons for a
voluntary quit shall be presumed to be without good cause attributable
to the employer: . . . The claimant is deemed to have left if such claimant
becomes incarcerated.” Iowa Admin. Code r. 871—24.25(16). The EAB
and the district court found that Irving’s imprisonment was a voluntary
quit under section 96.5(1) and its implementing regulations.
The statute contains a provision related to the burden of proof
regarding voluntary quits. The general rule in the statute is that the
burden of proof with respect to disqualification for benefits rests with the
employer. Iowa Code § 96.6(2). Notwithstanding the general rule, the
45
claimant has the burden of “proving that a voluntary quit . . . was for
good cause attributable to the employer.” Id.
C. Positions of the Parties. Irving argues that she did not leave
her work voluntarily under the statute and that because she was
involuntarily incarcerated, her absence from work cannot be regarded as
a voluntary quit under the regulation. She notes that because neither
Iowa Code section 96.5(1) nor Iowa Administrative Code rule 871—
24.25(16) define “voluntarily” or “voluntary quit,” these terms should be
given their ordinary and common meaning. She suggests that the EAB’s
interpretation of Iowa Administrative Code rule 871—24.25(16) extends
the term “voluntary” to cover acts that are unforeseeable and without
volition when it asserts incarceration results in a voluntary quit without
requiring an additional finding of culpability or intent. These
interpretations, according to Irving, are beyond the authority vested in
the agency by the legislature. See Iowa Code § 17A.19(10)(b). When the
law of voluntary quits is correctly viewed, Irving maintains, there is no
substantial evidence to support her disqualification from receiving
benefits. See Iowa Code § 17A.19(10)(f).
The EAB argues that Iowa Administrative Code rule 871—
24.25(16), stating that incarceration will be presumed a voluntary quit, is
a rule that is a rational interpretation of the Employment Security Law.
The EAB has been delegated the authority to interpret the Employment
Security Law, it argues, and so the standard for the validity of the rule is
that it must not be “irrational, illogical, or wholly unjustifiable.” See
Iowa Code § 17A.19(10)(l). Further, the EAB argues that if incarcerations
are not presumed to be a voluntary quit even without evidence of guilt, it
would lead to the unreasonable result of an employer needing to
46
investigate the guilt of their employee before they were discharged or
having to prove the employee’s guilt at the EAB hearing. 2
D. Authority from Other States Regarding Incarceration as a
Voluntary Quit. We have not had an opportunity to address the
question of the impact of incarceration on disqualification for
unemployment benefits under Iowa Code section 965(1). Although other
states’ cases are not uniform, the majority stand for the proposition that
absence due to incarceration does not give rise to an irrebuttable
presumption that the employee is disqualified from receiving
unemployment benefits on the ground that the employee voluntarily quit
employment.
Perhaps the case closest to our present controversy is Parker v.
Department of Labor & Employment Security, 440 So. 2d 438, 439–40
(Fla. Dist. Ct. App. 1983). In that case, the Florida District Court of
Appeal considered a case where an employee was arrested as a result of
a domestic argument and was unable to pay bail. Id. at 438–39. The
employee contacted his employer by phone and twice by letter during the
approximately one-month period of incarceration. Id. at 439.
Eventually, the charges were dropped. Id. at 439. Like Iowa Code
section 96.5(1), the Florida unemployment statute disqualified from
unemployment benefits a person who “voluntarily left his employment
without good cause attributable to the employer.” Id. (quoting Fla. Stat.
2While it may be true that “[l]ongstanding administrative interpretations are
entitled to some weight in statutory construction,” we remain responsible to determine
if the administrative body is correct on the matter of law. Iowa Ins. Inst. v. Core Grp. of
Iowa Ass’n for Justice, 867 N.W.2d 58, 77 (Iowa 2015) (quoting Griffin Pipe Prods. Co. v.
Bd. of Review, 789 N.W.2d 769, 775 (Iowa 2010)); Painters & Allied Trades Local Union
246 v. City of Des Moines, 451 N.W.2d 825, 826 (Iowa 1990) (“An administrative
agency’s construction of a statute, however, does not make law or change the legal
meaning of a statute. This court is the final arbiter of a statute’s meaning.”).
47
§ 443.101(1)(a) (1981)). The Florida court rejected the claim that the
employee voluntarily quit his job. Id. The court noted there was nothing
in the record to indicate the employee committed the offense with which
he was charged. Id. Further, the employee kept his employer advised of
his status. Id. As a result, the court concluded that the employee was
entitled to receive unemployment compensation. Id. at 439–40.
Another instructive case is Ford v. Labor & Industrial Relations
Commission of Missouri, 841 S.W.2d 255, 256 (Mo. Ct. App. 1992) (per
curiam). In that case, the Missouri Court of Appeals considered a case
where a truck driver was charged with parental kidnapping. Id. The
employee notified his employer prior to his arrest and then again after
his arrest and extradition to Missouri. Id. at 256–57. There was no
evidence in the record, however, that the employee was convicted on the
kidnapping charge. Id. at 258.
The court concluded the employee should not be disqualified from
receiving unemployment benefits. Id. at 258–59. Like the Iowa statute,
the Missouri statute declared that one of its purposes was to provide
benefits to be used by “persons unemployed through no fault of their
own.” Id. at 257 (quoting Mo. Rev. Stat. § 288.020.1 (1986)). The court
noted, however, that an arrest is never, “in itself, a voluntary act.” Id. at
258. Further, the court concluded that incarceration cannot be deemed
voluntary if the employee never in fact committed the crime for which he
was arrested. Id. The court held that it would require either evidence in
the record that the employee had been convicted or “other evidence of his
guilt” in order to deny him unemployment benefits. Id.
Another instructive decision out of Missouri on this point is Moore,
49 S.W.3d at 737–39. As discussed above, the claimant in Moore was
arrested and jailed on a charge of assault, could not post bond, and was
48
incarcerated for several months. Id. at 734. He maintained innocence,
and the charges were eventually dismissed. Id. The Moore court rejected
the notion that his incarceration was a voluntary quit, noting that the
disqualifying provisions of Missouri law must be strictly and narrowly
construed in favor of finding that an employee is entitled to
compensation. Id. at 739. 3
In all the above cases, there were no criminal convictions or
admissions of guilt, and the employer was notified of the reasons for the
employee’s absence. Where there are admissions or convictions of guilt,
or where an employee has not notified an employer of his or her
incarceration, a disqualification becomes more likely.
For example, in a California case, an employee was sentenced to
jail for his role in a hit-and-run accident. Sherman/Bertram, Inc. v. Cal.
Dep’t of Emp’t, 21 Cal. Rptr. 130, 131 (Dist. Ct. App. 1962). The
employee lost his job and, upon being released, filed for unemployment
benefits. Id. In considering whether the employee “voluntarily quit his
job without good cause,” the court considered the purpose of the
California Unemployment Insurance Code as stated in its guide to
interpretation, which was to provide benefits for “persons unemployed
through no fault of their own.” Id. at 131–32 (quoting Cal. Unemp. Ins.
Code § 100 (1958)). The court declared that to suggest the employee was
unemployed through no fault of his own was “pure sophistry” because of
his “wil[l]ful and felonious act in leaving the scene of an accident.” Id. at
132. Plainly, the California court believed that the guilt of the employee
was established. Therefore, even though the employee did not intend to
3As mentioned above, the Moore court nevertheless found that the failure of the
claimant to report his absence when he could have done so was misconduct and that
the record supported such a finding. 49 S.W.3d at 740.
49
become incarcerated, nor to become unemployed, he nevertheless
“voluntarily embark[ed] upon a course of conduct, the very nature of
which he knew . . . would jeopardize his return to work.” Id. at 133.
Therefore, the court found that the employee’s incarceration was a
voluntary quit. Id. at 133–34.
Subsequent to the Sherman/Bertram case, the California
legislature passed a statute providing,
If the employment of an individual is terminated due to his
absence from work for a period in excess of 24 hours
because of his incarceration and he is convicted of the
offense for which he was incarcerated or of any lesser
included offense, he shall be deemed to have left his work
voluntarily without good cause . . . .
Cal. Unemp. Ins. Code § 1256.1 (2015). In hearing a challenge to this
law, a California court found it constitutional, stating,
The Legislature has determined persons who are terminated
as a direct result of their criminal behavior and incarceration
are not “unemployed through no fault of their own” and are
therefore ineligible for benefits. The classification is
reasonable and bears a rational relation to the objective of
unemployment compensation law.
Jefferson v. Unemployment Ins. Appeals Bd., 130 Cal. Rptr. 405, 410 (Ct.
App. 1976) (emphasis added).
One New Jersey case seems to be an outlier. In Fennell v. Board of
Review, 688 A.2d 113, 113 (N.J. Super. Ct. App. Div. 1997), a
New Jersey appellate court confronted a case in which the employee was
arrested and unable to post bail for nine months. The aggravated
assault charges against him were ultimately dropped. Id. Similarly to
Iowa, the courts in New Jersey state that the purpose of their
unemployment compensation law is to protect the state’s citizens of the
“hazards of economic insecurity due to involuntary unemployment.” Id.
at 114. Unlike other courts, the New Jersey court focused entirely on the
50
“without good cause attributable to work” element of the “voluntary quit
without good cause attributable to work” language. Id. The court did
not seem to consider the lack of voluntariness, instead stating that the
employee’s inability to post bail was an “unfortunate economic and legal
problem[] . . . not related to his employment.” Id. at 115 (emphasis
added).
E. Iowa Caselaw Regarding Absenteeism as a Voluntary Quit.
While we have yet to decide a case on the issue of incarceration as a
voluntary quit, we have considered cases discussing voluntariness in
other unemployment compensation settings.
One of our early cases dealing with the question of voluntary quits
under the Iowa Employment Security Law is Moulton, 239 Iowa at 1165–
73, 34 N.W.2d at 213–17. In that case, a pregnant employee left the
workplace and sought unemployment benefits. Id. at 1162–63, 34
N.W.2d at 212. We framed the issue as whether the physical disability
due to her pregnancy made her quitting work voluntary or involuntary.
Id. at 1164–65, 34 N.W.2d at 213.
In Moulton, we cited an early Iowa case for the proposition that
voluntary means an act “of her own volition or choice.” Id. at 1165, 34
N.W.2d at 213 (citing Margoris v. U.S. R.R. Admin., 187 Iowa 605, 608,
174 N.W. 371, 372 (1919)). Finding an analogy to persons who
deliberately maim themselves to be unfit for work, we held the
termination of employment was voluntary. Id.
We revisited the issue of voluntariness in Cook, 299 N.W.2d at
701–02. As discussed above, the claimant in Cook received numerous
speeding tickets, mostly during nonworking hours. Id. at 699. The
claimant’s job, however, consisted of delivering loads of groceries from
his employer’s warehouse to local merchants. Id. When the employer’s
51
insurance carrier advised the employer that it would no longer insure the
claimant, the claimant was terminated. Id. at 700. The claimant then
applied for unemployment benefits. Id.
The first question in Cook was whether his termination could be
considered voluntary as found by the agency but reversed by the district
court. Id. The Cook court agreed with the district court. Id. at 701. We
made short work of the argument. We cited an administrative rule,
which stated that “in general, a voluntary quit means discontinuing the
employment because the employee no longer desires to remain in the
relationship of an employee with the employer.” Id. We noted that the
claimant did not leave as a result of unsafe working conditions, “[n]or did
he quit because he desired to do so.” Id. at 701–02. We declared under
the facts that “[u]nquestionably this was not a case of a ‘voluntary quit.’ ”
Id. at 702. In Cook, external actions by law enforcement did not give rise
to a voluntary quit for purposes of disqualification for unemployment
benefits even though the claimant’s poor driving record had an adverse
impact on the employer when the insurer decided to drop coverage for
the claimant. Id.
In Ames v. Employment Appeal Board, 439 N.W.2d 669, 670–72
(Iowa 1989), we considered another interesting case dealing with
voluntary quits. In Ames, employees at two plants refused or were
pressured not to cross a union picket line. Id. After the employees were
terminated, they sought unemployment benefits, claiming they did not
voluntarily leave their jobs due to the risk of violence associated with
crossing the picket lines. Id.
Our first holding was that it was not necessary for the claimants to
demonstrate that the departure from employment was “for good cause
attributable to the employer.” Id. at 673–74. We held that it is not
52
necessary to make such a showing if the termination was not voluntary.
Id. at 674. Under the facts of that case, we concluded that some of the
claimants were involuntarily separated from employment because of the
threat of violence, while others failed to make an adequate showing. Id.
at 674–75. In Ames, external forces not attributable to the employer
provided the basis for determining that a termination of employment was
not voluntary.
In Sharp, 479 N.W.2d at 283–84, we relied on Ames in reaching a
similar outcome under a different fact pattern. The claimant meat cutter
left her job in a turkey plant because she developed viral hepatitis. Id. at
281. Her doctor advised her not to work with food or cleaning solvents.
Id. As a result, she did not return to work. Id. The question in the case
was whether the quit should be considered voluntary or involuntary for
purposes of unemployment benefits. Id.
We held that her departure was not voluntary for purposes of
determining disqualification for unemployment benefits. Id. at 284. We
again stated that the purpose of the “without good cause attributable to
the employer” language was to ensure that an employee voluntarily
leaving the workplace could nonetheless qualify for benefits under some
circumstances. Id. at 283. Although the employer was not responsible
for the viral hepatitis, we held that the claimant’s departure could not be
considered voluntary. Id. at 283–84. The unmistakable feature of Sharp
is that the “without good cause” language is designed to broaden, and
not narrow, the grounds upon which unemployment benefits might be
obtained. See id. at 283.
We revisited the issue of whether departure from a job due to
pregnancy amounted to a voluntary quit in Wills v. Employment Appeal
Board, 447 N.W.2d 137, 138 (Iowa 1989). In Wills, the claimant, a
53
nurse’s aide, left employment when, after presenting her employer with
lifting restrictions from her doctor, the employer advised her that she
could no longer work at the facility. Id. at 137–38. We noted that under
the applicable administrative rule, a voluntary quit in general “means
discontinuing the employment because the employee no longer desires to
remain in the relationship.” Id. at 138. We also cited a South Dakota
case for the propositions that “establish[ing] a voluntary quit requires
that an employee intend to terminate employment.” Id. (citing In re
Johnson, 337 N.W.2d 442, 447 (S.D. 1983)). Yet, the record showed that
the claimant was able to work notwithstanding her weight restrictions.
We held that the termination of employment under the circumstances
was not voluntary.
Finally, in Bartelt, we considered a case in which the president,
sole stockholder, and salaried employee of a corporation applied for
unemployment benefits after his corporation failed. 494 N.W.2d at 685.
The individual filed for voluntary bankruptcy on behalf of his
corporation, but he did so on legal advice based on the certainty that an
involuntary bankruptcy would shortly occur. Id. After considering that a
voluntary quit must entail a free choice, we found that the individual’s
actions were not voluntary because of the certainty of bankruptcy no
matter what he did. Id. at 686–87. We noted that “when an outside
force over which neither the employee nor the employer has any control
creates the unemployment, the unemployment is involuntary.” Id. at
686. We further stated that we would not “pretend there has been a
voluntary quit” just because unemployment coverage might be
inappropriate for the president, sole-owner, and employee of a single-
owner corporation; such a decision is properly one for the legislature. Id.
at 686–87.
 54
F. Analysis. We reiterate here the general and specific rules of
statutory interpretation presented earlier in this opinion. In considering
the question of what amounts to a voluntary quit, we must (1) liberally
construe the statute in light of its policy goals, Bridgestone/Firestone,
570 N.W.2d at 96; (2) place the burden of proof of showing
disqualification on the employer, Bartelt, 494 N.W.2d at 686; and
(3) narrowly interpret any statutory provision related to disqualification,
Bridgestone/Firestone, 570 N.W.2d at 96.
Based upon our review of the statute, the authorities, and
applicable caselaw, we conclude that a voluntary quit as a matter of law
requires a volitional act on the part of the employee. We do not think
that incarceration, in and of itself, can ever be considered “volitional” or
“voluntary.” Indeed, incarceration is perhaps the ultimate nonvolitional
act.
The caselaw from other states teaches us, however, that the
volitional principle does not mean that incarceration can never be part of
the chain of events that gives rise to disqualification from unemployment
benefits. The predicate acts that led to incarceration, however, must be
volitional and must lead to an absence from the workplace that results in
a loss of employment. In other words, a voluntary quit must be volitional
at its inception. See, e.g., Bartelt, 494 N.W.2d at 687 (holding a
voluntary quit must entail a free choice); Wills, 447 N.W.2d at 138 (“[A]
voluntary quit requires that an employee intend to terminate
employment.”); Cook, 299 N.W.2d at 702 (finding no voluntary quit where
employee did not desire to quit); Moulton, 239 Iowa at 1165, 34 N.W.2d
at 213 (emphasizing employee’s “own volition or choice”).
The above survey of the cases demonstrates there is no doctrine of
a constructive voluntary quit in Iowa law. A notion of constructive
55
voluntary quit would be completely inconsistent with the beneficial
purposes of the Act and the requirement of strict construction of
disqualification provisions. We especially do not believe that absence
due to incarceration amounts to a constructive quit of a job.
That said, we can imagine circumstances where a deliberate
volitional refusal to pay child support might predictably lead to
incarceration. The incarceration then leads to absence from work, and
the absence from work leads to termination. Under these circumstances,
the volitional act of refusing to pay for child support might, perhaps, be
considered a voluntary quit or, more likely, misconduct. Further, when
an employee fails to notify the employer of the status of his or her
incarceration, that may result in a voluntary quit or misconduct. Moore,
49 S.W.3d at 740.
We think, however, that incarceration in and itself does not
establish a voluntary quit. Instead, the circumstances that led to the
incarceration must establish volitional acts of a nature sufficient to allow
a fact finder to draw the conclusion that the employee by his intentional
acts has purposively set in motion a chain of events leading to
incarceration, absence from work, and ultimate termination from
employment. This is the essence of the teaching of the Parker, Ford,
Moore, and Hawkins cases.
We recognize that the Fennell case from New Jersey takes a
contrary position. Yet that case is distinguishable. In Fennell, the
New Jersey court in effect interpreted the phrase “attributable to the
employer” differently than our courts under Iowa caselaw. See 688 A.2d
at 115. For a quit to be nonvoluntary under Fennell, the reasons for the
quit must be attributed to the employer with very few and narrow
exceptions. See id. That is simply not the law in Iowa. See Sharp, 479
56
N.W.2d at 283; Ames, 439 N.W.2d at 674. As a result, the Fennell case
has no applicability here.
In light of the above, we now consider proper interpretation of rule
871—24.25(16). The EAB suggests that under the rule, incarceration is
deemed to be “voluntary.” In other words, the EAB is suggesting that its
rule establishes a category of constructive voluntary quit.
But we think the EAB misreads its own rule. The rule states that
the listed “reasons for a voluntary quit shall be presumed to be without
cause attributable to the employer.” Iowa Admin. Code r. 871—24.25
(emphasis added). Thus, the focus of the rule is determining which
departures from employment cannot be excused for purposes of
disqualification for unemployment benefits because the quit was a result
of cause attributable to the employer. Under subsection (16), a claimant
is “deemed to have left if such claimant becomes incarcerated.” Id.
r. 871—24.25(16). Thus, when a claimant leaves employment due to
incarceration, it cannot be maintained that the quit was due to “cause
attributable to the employer.”
The rule does not address the predicate issue of voluntariness. It
only addresses the distinctly different issue of when an otherwise
voluntary departure may nonetheless not lead to disqualification because
of good cause attributable to the employer. As our caselaw repeatedly
points out, these are separate issues. Sharp, 479 N.W.2d at 283; Ames,
439 N.W.2d at 674.
So construed, the rule is consistent with Iowa Code section 96.6(2).
The statute allows a shifting of the burden of proof where a voluntary
quit is claimed to not be disqualifying because of “good cause
attributable to the employer.” Iowa Code § 96.6(2). Irving, of course,
makes no such claim. She only contends that her absence from
employment due to her incarceration was not voluntary. The burden of
57
showing such voluntariness is unaffected by the rule and remains with
the EAB under the statute.
In conclusion, under an interpretation of the statute, the
applicable rule, and our caselaw, the employer has the burden of proving
that a claimant’s departure from employment was voluntary. The term
“voluntary” requires volition and generally means a desire to quit the job.
Bartelt, 494 N.W.2d at 686; Wills, 447 N.W.2d at 138; Cook, 299 N.W.2d
at 701; Moulton, 239 Iowa at 1165–66, 34 N.W.2d at 213. Under the
record here, the employer did not meet that burden. The record simply
shows that Irving was arrested, that her incarceration continued for a
period of time, that she was unable to make bail, and that the charges
resulting in her incarceration were ultimately dropped. There is no
substantial evidence to show that her absence from work was voluntary.
As a result, the decision of the EAB must be reversed for lack of
substantial evidence. Iowa Code § 17A.19(10)(f).
VII. Conclusion.
For the above reasons, we hold that there is no spill-over effect
from Irving’s disqualification for misconduct, that the record does not
support a finding of misconduct, and that there is no substantial support
in the record to show that her absence from the workplace due to her
incarceration was a voluntary quit. As a result, the decision of the
agency is reversed.
REVERSED.
Cady, C.J., and Wiggins and Hecht, JJ., join this opinion. Cady,
C.J., files a specially concurring opinion in which Wiggins, J., joins.
Waterman, J., files an opinion concurring in part and dissenting in part
in which Mansfield and Zager, JJ., join.
58
#15–0104, Irving v. Emp't Appeal Bd.
CADY, Chief Justice (concurring specially).
The statute at the center of the dispute in this case disqualifies an
employee from receiving unemployment benefits when the employee was
discharged from employment for misconduct associated with the
employment. Iowa Code § 96.5(2) (2013). In turn, a long-standing
agency rule supplements the statute by declaring excessive absenteeism
constitutes misconduct and automatically disqualifies a terminated
employee from unemployment benefits. Iowa Admin. Code r. 871—
24.32(7). A separate agency rule supplements the statute, declaring
involuntary incarceration constitutes a voluntary quit without good
cause, which also disqualifies a terminated employee from
unemployment benefits. Iowa Code § 96.5(1); Iowa Admin. Code r. 871—
24.25(16).
I agree with the majority that each case of involuntary
incarceration must be analyzed on its own facts. Further, some
absenteeism due to incarceration might support misconduct under Iowa
Code section 96.5(2), but some might not.
Notwithstanding, I write separately only to point out the
importance of carefully considering how rules and statutes enacted over
the years to resolve various issues can adversely impact a particular
segment of people in society.
The agency absenteeism rule in this case has been in existence for
over forty years. See Iowa Admin. Code r. 871—24.32(7). Yet as this
case has revealed, when applied to situations of involuntary
incarceration for a bailable offense, the rule can disproportionately affect
those people in society without the financial resources to post bail. It
means people with the financial resources to post bail are unlikely to
59
incur excessive absences due to a bailable-offense incarceration, while
those without the financial ability to post bail suffer the consequences of
the absenteeism rule.
Justice in our state will be advanced when all implicit bias found
in our laws and rules can be identified and eliminated. This case is one
example and is a step in the right direction.
Wiggins, J., joins this special concurrence.
60
#15–0104, Irving v. EAB
WATERMAN, Justice (concurring in part and dissenting in part).
I respectfully dissent in part. I agree with the majority’s
conclusion that Irving’s misconduct termination from her part-time job
with employer Solon Nursing disqualified her from unemployment
benefits for that position alone. 4 But I would affirm the district court
and agency determination that Irving was properly denied unemployment
benefits for missing three weeks of work without her employer’s
permission while she was incarcerated on charges of felony domestic
abuse and making a false report calling 911. Iowa employers are entitled
to expect their employees to show up for work. Being in jail is not a valid
excuse for missing work.
The Administrative Law Judge (ALJ) who conducted the evidentiary
hearing found that Irving violated her employment contract:
The claimant did not have any available vacation hours and
would have had to request a leave of absence in advance of
the leave, in accordance with the union contract. The
employer concluded the claimant effectively resigned after
she was absent from duty for three consecutive work days
without proper notification and authorization.
4Solon Nursing terminated Irving for misconduct when she failed to report her
arrest within forty-eight hours as required for her position caring for disabled,
dependent patients. The legislature specifically provided that a termination for gross
misconduct cancels wage credits earned from “all employers.” Iowa Code § 96.5(2)(b)
(2013). By contrast, the legislature did not expressly provide that a termination for
misconduct from a part-time position, without a finding of gross misconduct, by itself,
disqualifies the individual for benefits for the loss of a job with a different employer.
Presumably, if the legislature intended the misconduct disqualification for benefits in
section 96.5(2)(a) to extend to all employers, it would have said so as it did for wage
credits based on gross misconduct in the next paragraph. See Oyens Feed & Supply,
Inc. v. Primebank, 808 N.W.2d 186, 193–94 (Iowa 2011) (concluding the fact that a
phrase was “selectively incorporated” in certain provisions showed the legislature’s
omission of that phrase in a related provision was intentional).
61
The Employment Appeal Board (EAB) and district court accepted the
ALJ’s finding. We are bound by the agency’s findings of fact that are
supported by substantial evidence. Dico, Inc. v. Iowa Emp’t Appeal Bd.,
576 N.W.2d 352, 354 (Iowa 1998). Two witnesses for her employer, the
University of Iowa Hospitals and Clinics (UHIC), testified that Irving was
required under her employment contract to submit requests for a leave of
absence thirty days in advance, which Irving failed to do. Reliable
attendance is especially important in Irving’s job as a medical assistant
at a hospital. Irving failed to show up for work or obtain authorization
for her absences during the three weeks preceding her termination.
Substantial evidence supports the agency’s finding that her prolonged
unexcused absence violated her employment contract. That factual
finding should be dispositive.
The EAB determined Irving was disqualified from receiving
unemployment benefits for her UIHC job on three separate grounds: (1)
her incarceration, deemed a voluntary quit under Iowa Administrative
Code rule 871—24.25(16); (2) her absence for three days without notice,
deemed a voluntary quit under rule 871—24.25(4); and (3) her excessive
unexcused absenteeism, deemed misconduct under rule 24.32(7). The
district court correctly affirmed on all three grounds. The majority errs
by reversing on all three grounds.
The majority substitutes its own policy choice, that someone
unable to make bail deserves unemployment benefits, for the eligibility
determination of the agency charged with administering Iowa’s complex
statutory scheme for unemployment benefits. The agency in 1975
promulgated an administrative rule providing that persons who miss
work due to incarceration are disqualified from receiving unemployment
benefits. Iowa Admin. Code r. 370—4.25(16) (1975). I would not second-
62
guess that commonsense determination. The incarceration rule has
been on the books and enforced by the agency for four decades without
challenge. 5 See id. r. 871—24.25(16) (2016). The legislature, apparently
satisfied with that rule, has repeatedly amended chapter 96 to add other
exceptions and qualifications for the receipt of unemployment benefits
while leaving the incarceration rule intact. See, e.g., 2010 Iowa Acts
ch. 1048, § 1; 1997 Iowa Acts ch. 132, § 1. “We consider the legislature’s
inaction as a tacit approval of the [agency’s] action.” City of Sioux City v.
Iowa Dep’t of Revenue & Fin., 666 N.W.2d 587, 592 (Iowa 2003) (“The fact
that this administrative rule has been in effect for eleven years strongly
cautions against finding the rule invalid.”). Of course, the legislature is
free to overrule today’s judicial policy choice requiring benefits for job
loss attributable to incarceration.
The majority fails to strike the proper balance when interpreting
chapter 96. We have previously recognized that chapter 96 strikes a
balance between providing benefits for “ ‘persons unemployed through no
fault of their own’ . . . and fundamental fairness to the employer, who
must ultimately shoulder the financial burden of any benefits paid.”
White v. Emp’t Appeal Bd., 487 N.W.2d 342, 345 (Iowa 1992) (quoting
Iowa Code § 96.2 (1991)). In Messina v. Iowa Department of Job Service,
we observed,
The unemployment compensation statute . . . touches upon
more than just the recipient. It provides for the creation of a
5I recognize that we do not generally regard the status of being incarcerated as
“voluntary.” However, the agency and the legislature were certainly entitled to conclude
that incarceration in most cases results from voluntary conduct on the part of the
incarcerated person. With a few commonsense exceptions, our unemployment
compensation statute holds people responsible for getting to work and does not accept
excuses such as car trouble, bad weather, or child-care issues. Being in jail is not one
of those commonsense exceptions.
63
fund produced by contributions from private employers. The
rate of an employer’s contribution to the fund varies
according to benefits paid to that employer’s eligible
employees. Any action with regard to disbursements from
the unemployment compensation fund thus will affect both
the employer and the fiscal integrity of the fund.
341 N.W.2d 52, 62 (Iowa 1983) (quoting Ohio Bureau of Emp’t Servs. v.
Hodory, 431 U.S. 471, 490, 97 S. Ct. 1898, 1909, 52 L. Ed. 2d 513, 529
(1977)). We noted the legislative goal of attracting and retaining job-
creating industries is thwarted when “employees discharged for
misconduct nonetheless are paid unemployment benefits from funds
extracted from employers.” Id. We stated,
The fiscal integrity of the fund should not be
jeopardized by payments to employees . . . discharged for
[misconduct]. This would strike at the expressed state
interest disclosed by the legislature in creating the fund [to]
. . . “benefit . . . persons unemployed through no fault of their
own.”
Id. (quoting Iowa Code § 96.2 (1983)). Today’s decision may give
employers and prospective employers pause. Some may become more
reluctant to hire people viewed as being at risk of incarceration, such as
persons who already have criminal records or records of arrests.
The majority undermines our “personal responsibility” precedents
that disqualified claimants who were repeatedly late for work due to child
care or transportation problems. I would honor stare decisis and follow
our precedent to hold that Irving’s three-week unexcused absence from
work for personal reasons disqualified her from unemployment benefits.
In Cosper v. Iowa Department of Job Service, we held that excessive
unexcused absences can be disqualifying misconduct. 321 N.W.2d 6, 10
(Iowa 1982). The agency promulgated an administrative rule based on
Cosper:
Excessive unexcused absenteeism. Excessive unexcused
absenteeism is an intentional disregard of the duty owed by
64
the claimant to the employer and shall be considered
misconduct except for illness or other reasonable grounds
for which the employee was absent and that were properly
reported to the employer.
Iowa Admin. Code r. 871—24.32(7). “[A]bsenteeism arising out of
matters of purely personal responsibilities” is not excusable. Higgins v.
Iowa Dep’t of Job Serv., 350 N.W.2d 187, 191 (Iowa 1984).
We considered a case of “purely personal responsibilities” in
Higgins. Id. Barbara Higgins was employed by United Parcel Service. Id.
at 189. In her last six months at UPS, she began to accumulate
absences, and Higgins’s supervisor reviewed her absences with her. Id.
When she failed to report to work or give a reason on April 16, 1982, she
was placed on a thirty-day probation. Id. Her probation required her to
“be on time every day in the future and in attendance every day to avoid
further disciplinary action.” Id. On May 24, she was a few minutes late
and told her supervisor the babysitter was late. Id. On June 2, she was
fifteen minutes late because she overslept. Id. Higgins was fired on
June 4. Id. Higgins sought unemployment benefits, and her claim was
denied. Id. We affirmed the denial of benefits. Id. at 192. We held her
absences were excessive and unexcused. Id. at 190–91. We said,
“Oversleeping cannot be deemed a ‘reasonable ground’ for missing work.”
Id. at 191. Although the agency had found the absences due to Higgins’s
babysitter problems were excused, we disagreed, concluding that
absenteeism caused by unreliable child care or transportation is not
excusable. Id.
In a case filed the same day, we affirmed the agency’s denial of
benefits in Harlan v. Iowa Department of Job Service, 350 N.W.2d 192,
195 (Iowa 1984). Judith Harlan was employed at Younkers Brothers,
Inc. for three years. Id. at 193. She received warnings in 1981 and 1982
65
regarding her tardiness. Id. at 194. In 1981, she told her employer she
had car problems that required her to rely on public transportation. Id.
After the warning in 1982, Harlan was late ten times over the course of
about four months. Id. She arrived at work on those days from ten to
sixty minutes after the start of her scheduled shift. Id. She frequently
failed to give advance notice when she would be late. Id. Her tardiness
made it difficult for her supervisors to adequately cover her department.
Id. Harlan was discharged in May 1982 for excessive tardiness. Id. at
193. At the agency hearing, the hearing officer acknowledged that some
of Harlan’s tardiness was explainable due to issues with weather and
public transportation, but Harlan was tardy in the late spring when
weather was not an issue. Id. at 194. Moreover, Harlan had the option
of taking an earlier bus. Id. These factors made her habitual tardiness
disqualifying misconduct. Id.
Notably, we did not consider the individual’s financial
circumstances, such as an inability to afford child care or a reliable
vehicle, in holding the absences from work constituted disqualifying
misconduct. Nor should we expect the EAB or employers such as UIHC
to assess an employee’s financial ability to make bail or the likelihood
charges will be dismissed in determining whether incarceration excuses
an extended absence from work. I defer to the elected branches to make
these policy choices. It is for the legislative and executive branches to
decide whether Iowa is better off with a more lenient system of
unemployment compensation—which results in higher premiums and
higher costs of hiring employees—or a less lenient system that does not
allow persons who missed work due to being in jail to collect benefits.
Irving’s absenteeism is analogous to Higgins and Harlan. She was
scheduled to work eight-hour shifts and missed ten work days in a row.
66
Irving’s employer did not authorize her absence as required under the
union contract. If being late repeatedly due to babysitter problems, a
late bus, oversleeping, or car trouble is disqualifying misconduct
regardless of the employee’s financial circumstances, so too is missing
work for ten shifts in a row due to an arrest and incarceration after a
domestic dispute.
The majority relies on Roberts v. Iowa Department of Job Service,
356 N.W.2d 218, 222–23 (Iowa 1984), which I find readily
distinguishable. Lanelle Roberts missed work when she was hospitalized
for treatment of mental illness (schizophrenia, paranoid type). Id. at
219–20. Her employer fired her for excessive absenteeism, and she filed
for unemployment benefits, which were denied based on the agency rule
for excessive absenteeism. 6 Id. at 220. The district court affirmed, but
we reversed, concluding that her absences due to her incapacitating
mental illness did not constitute disqualifying misconduct. Id. at 222.
We noted that she had not violated her company’s policy that authorized
termination after three days’ unreported absence. Id. at 221–22. We
found the record “establish[ed] as a matter of law that she was ‘unable
[to] protect her own interests at that time, in particular, she was unable
to call her employer each day to report her absence.’ ” Id. at 222. We
relied on testimony of her treating physician that her “serious mental
condition” rendered her unable to communicate. Id. I do not equate
Irving’s incarceration on charges of domestic abuse with an
6The administrative rule in effect at the time of Roberts’s denial of benefits
stated,
Excessive absenteeism. Excessive absenteeism is an intentional
disregard of the duty owed by the claimant to the employer and shall be
considered misconduct.
Roberts, 356 N.W.2d at 222 (quoting Iowa Admin. Code r. 370—4.32(7) (1984)).
67
incapacitating illness. Irving’s case is more like Higgins and Harlan than
Roberts.
Courts in other jurisdictions have held that unexcused absences
attributable to incarceration disqualify claimants from unemployment
benefits even when benefits are allowed for absences due to illness. A
New Jersey appellate court concluded that incarceration was not
analogous to an illness causing excusable absenteeism. Fennell v. Bd. of
Review, 688 A.2d 113, 115 (N.J. Super. Ct. App. Div. 1997). The
majority mislabels Fennell as an “outlier” without acknowledging many
other decisions reaching the same result. See, e.g., Bivens v. Allen, 628
So. 2d 765, 766–67 (Ala. Civ. App. 1993); Weavers v. Daniels, 613
S.W.2d 108, 109–10 (Ark. Ct. App. 1981); Camara v. Marine Lubricants,
No. N12A–05011–DCS, 2013 WL 1088334, at *3–4 (Del. Super. Ct.
Feb. 25, 2013); In re Karp, 692 N.Y.S.2d 516, 517 (App. Div. 1999);
Beatty v. Unemployment Comp. Bd. of Review, No. 1331 C.D. 2008, 2009
WL 9097018, at *2 (Pa. Commw. Ct. Jan. 28, 2009).
Fennell fits like a glove with Iowa’s “personal responsibility” cases.
Ricky Fennell, a hospital employee, was jailed for nine months on
pending assault charges. Fennell, 688 A.2d at 113. He was unable to
make bail and “made all reasonable efforts to get his employer to hold his
job open until his release.” Id. at 113–14. He was terminated after
missing work for three months and applied for unemployment benefits
after the hospital declined to rehire him upon his release from jail. Id. at
114. The agency “upheld the denial of benefits because [his] reason for
leaving his job was incarceration, a personal problem not attributable to
work.” Id. The appellate court affirmed, stating,
Here appellant’s reason for leaving work was his
personal problem, incarceration on criminal charges and his
inability to raise enough money to post bail. These
68
unfortunate economic and legal problems were not related to
his employment. Nor is an employee’s intent to quit either
relevant or controlling, unless the judicially-created
exception for illness is implicated.
Id. at 115. The Fennell court declined to apply New Jersey precedent—
that state’s counterpart to Roberts—allowing benefits when the absence
from work is attributable to illness. Id. at 114–15. While noting a split
in authority, the Fennell court noted, “Other jurisdictions routinely deny
claims [for unemployment benefits] where incarceration causes an
absence from employment.” Id. at 116 (collecting cases).
Similarly, a Delaware court recently equated incarceration for a
domestic dispute to a personal matter:
Appellant informed the Board that his arrest was generated
by a personal matter—his wife called the authorities. The
Court does not intend to delve into the domestic relations
between Appellant and his wife; however, there can be
nothing more personal than matters of the home. So, too,
strained domestic relations are beyond the employer’s
control. Thus, the Board determined that . . . Appellant’s
incarceration was personal and not work related and,
therefore, Appellant had voluntarily left his employment.
Camara, 2013 WL 1088334, at *3; see also Bivens, 628 So. 2d at 766–67
(holding claimant incarcerated for seven days was not entitled to
benefits); Weavers, 613 S.W.2d at 109–10 (holding employee incarcerated
and unable to post bail was properly denied unemployment benefits for
misconduct); Karp, 692 N.Y.S.2d at 517 (holding claimant who was
arrested and did not post bail committed disqualifying misconduct);
Beatty, 2009 WL 9097018, at *2 (collecting cases and observing that “[i]t
is well established that incarceration is not a reasonable or justifiable
absence from work”). I find these authorities persuasive.
Irving argues she was innocent of the charge of domestic abuse,
pointing to her partner’s recantation months later. It is unclear whether
the majority relies on her innocence, the lack of a conviction, or her
69
inability to post bail to require benefits. We recently reiterated that
victims often recant in domestic abuse cases. State v. Smith, 876 N.W.2d
180, 187–88 (Iowa 2016) (citing authorities concluding that many victims
recant); id. at 194 (Waterman, J., dissenting) (citing additional
authorities estimating “[t]he rate of recantation among domestic violence
victims [is] . . . between eighty and ninety percent”). Employers and the
EAB should not be put in the untenable position of determining the
actual guilt or innocence of jailed employees or whether voluntary
conduct landed them in jail. 7 As other courts have concluded, actual
innocence is irrelevant to the fact the employee is not showing up for
work. See, e.g., In re Bishop, No. A-6222-06T16222-06T1, 2009 WL
36444, at *3 (N.J. Super. Ct. App. Div. Jan. 8, 2009) (“Bishop’s absence
from work for more than sixty days is undisputed. That he was
incarcerated on charges that were eventually dismissed is irrelevant
since his custodial confinement was unrelated to this employment.”). A
Delaware court aptly observed,
Public policy . . . does not support the theory that an
employee is available for work while incarcerated and that
such a situation requires an employer to hold the job for
someone who is indefinitely absent. The purpose of having
an employee is for them to work. To require that employers
keep a job open for those employees who become
incarcerated or risk having to pay unemployment benefits is
unreasonable and against . . . public policy . . . .
7Federal regulations require prompt determinations on eligibility for
unemployment benefits. See Iowa Code § 96.11(10) (2013) (“[T]he department shall
cooperate with the United States department of labor to the fullest extent consistent
with the provisions of this chapter . . . .”). In order to comply with federal regulations,
the state must issue sixty percent of first-level benefit appeal decisions within thirty
days of the date of appeal and at least eighty percent of first-level benefit appeal
decisions within forty-five days. 20 C.F.R. § 650.4(b) (2013). Needless to say, the
wheels of justice often spin more slowly in criminal cases.
70
Mason v. Best Drywall, No. C.A. 98A-07-005-RSG, 1999 WL 459303, at
*3 (Del. Super. Ct. 1999) (footnote omitted).
I disagree with the majority that Minnesota caselaw supports
Irving. In Jenkins v. American Express Financial Corp., a divided
Minnesota Supreme Court adopted a fact-specific, case-by-case approach
and concluded the employer’s unfulfilled promise to verify Jenkins’s
employment for work release prevented her from continuing to work and
entitled her to unemployment benefits. 721 N.W.2d 286, 290–92 (Minn.
2006). Jenkins is distinguishable because it is undisputed that UIHC
played no role in Irving’s initial incarceration or its duration. Moreover,
the Jenkins dissent concluded that not showing up for work is
disqualifying misconduct. Id. at 294 (Gildea, J., dissenting). Quoting the
purpose of the Minnesota Act, the dissent stated, “Jenkins did not lose
her job ‘through no fault of her own.’ She lost her job because she did
not show up for work.” Id. (quoting Minn. Stat. § 268.03, subdiv. 1
(2004)). I agree with the dissent.
Significantly, Minnesota appellate courts after Jenkins have
routinely held that persons missing work due to incarceration are
disqualified from unemployment benefits. See, e.g., Luhman v. Red Wing
Shoe Co., No. A14–1193, 2015 WL 134211, at *3 (Minn. Ct. App. Jan. 12,
2015) (affirming denial of benefits when employee missed three workdays
due to incarceration); Millis v. Martin Eng’g Co., No. A11–2085, 2012 WL
3892191, at *2 (Minn. Ct. App. Sept. 10, 2012) (“An employer has a right
to expect an employee to work when scheduled.”); Lavalla v. Am. Red
Cross Blood Servs., No. A11–782, 2012 WL 1380327, at *3 (Minn. Ct.
App. Apr. 23, 2012) (rejecting chemical dependency excuse for
incarceration); Miller v. SDH Educ. W. LLC, No. A08–1169, 2009
WL 1684442, at *2 (Minn. Ct. App. June 16, 2009) (“When an employee
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misses work because of incarceration, ordinarily his absenteeism is
deemed to be his own fault and to constitute employment misconduct.”).
Even under Minnesota’s case-by-case, fact-specific approach, Irving is
disqualified based on the agency finding that her extended absence from
her job at the UIHC was unauthorized by her employer.
Today’s decision replaces a clear rule with uncertainty. It remains
to be seen whether everyone unable to make bail will be entitled to collect
unemployment benefits for the resulting job loss, or only those who avoid
a conviction. The majority leaves employers guessing.
For these reasons, I dissent in part.
Mansfield and Zager, JJ., join this special concurrence in part and
dissent in part.