Saturday, November 26, 2016

Piloski v. Division of Employment Security

Opinion handed down October 25, 2016

While Missouri’s unemployment security laws are aimed at protecting employees who have become unemployed through no fault of their own, significant questions remain as to whether these laws are actually interpreted as broadly as they can be by the courts.

I.  Facts and Holding

David Piloski was hired as a welder by his employer’s predecessor in October 2007 after responding to an advertisement that read: “Will work in clean, A/C environment.”[1]  Piloski’s job consisted of welding flow control systems, which required working in a temperature controlled “clean room.”[2]  Two other welders were required to work outside of the “clean room,” and in the event of their absence, Piloski was required to fill in, meaning he would work outside of the clean room about once or twice a month, usually for a half hour to an hour at a time.[3]  When his current employer acquired the business in August 2013, the employer required that Piloski periodically work outside of the clean room.[4]  Piloski refused, claiming that working outside of the clean room was not part of his job duties.[5]  After consulting with human resources, his employer told Piloski’s supervisors that Piloski was required to work where he was told to work.[6]  The supervisors, however, did not enforce the rules prescribed by the employer and human resources.[7]
However, starting in early August 2015, Piloski’s employer informed him and the other clean room welder that they would be required to start working outside of the clean room for approximately two hours per day.[8]  Shortly thereafter, on August 15, 2015, Piloski and the other clean room welder were told by the employer that they would need to begin working alternating weeks outside of the clean room, because a welder in that area had recently quit.[9]  This increasing frequency with which Pilosky was required to work outside of the clean room caused Piloski to fear that he would be required to work outside of the clean room on a permanent basis.[10] 
Two days later, on August 17, 2015, Piloski informed his employer that the chemicals present outside of the clean room were giving him a headache and that he refused to continue working outside of the clean room.[11]  The next day, August 18, 2015, the employer and Piloski met and discussed Piloski’s job requirements.[12]  Piloski reiterated his refusal to work outside of the clean room, claiming he was hired specifically to be a clean room welder.[13]  The employer responded that Piloski was simply hired to be a welder.[14]  During the meeting, Piloski raised concerns about the chemical fumes outside of the clean room affecting his health.[15]  His employer attempted to allay those fears by informing Piloski that whenever he was assigned to work outside of the clean room, he would be the only welder in the area, and he would have sole use of the fume extractor.[16]  At the end of the meeting, the employer reminded Piloski that his refusal to follow these orders would result in termination due to insubordination.[17]  Piloski asked if he was free to resign, and his employer responded that the choice of resignation was ultimately Piloski’s choice.[18]
The next day, Piloski reported for work outside of the clean room as directed but filled out his resignation, effective September 11, 2015.[19]  After September 11, 2015, Piloski filed for unemployment benefits, where he was denied by a deputy of the Division of Employment Security because he had voluntarily quit his job without showing good cause attributable to his employer.[20]  According to the deputy, Piloski “did not take reasonable steps to maintain his employment.”[21]
Following the necessary administrative procedures, Piloski appealed the deputy’s decision to the Appeals Tribunal (“Tribunal”), which held a hearing consisting of testimony from Piloski and two of his employer’s representatives.[22]  The Tribunal reversed the deputy’s determination, holding that Piloski’s welding outside of the clean room constituted a substantial change in employment that would compel a reasonable employee to cease working.[23]
The employer then appealed to the Labor and Industrial Relations Commission (“Commission”), which concluded that Piloski did not meet his burden of showing good cause for voluntarily quitting his employment.[24]  The Commission concluded that: (1) “Piloski’s decision to quit was not compelled by a medical need,” (2) Piloski quit due to a change in working conditions that he found unacceptable, (3) “the change in Piloski’s work conditions was not substantial,” (4) “Piloski did not act as a reasonable employee would act in electing to voluntarily quit,” and (5) “Employer’s response to mitigate Piloski’s expressed concern about chemical fumes was reasonable.”[25]  The Commission therefore reversed the Tribunal’s decision, denying Piloski unemployment benefits.[26]  Piloski timely filed his appeal to the Missouri Court of Appeals for the Western District.[27]
II.  Legal Background
             In Missouri, a worker’s eligibility for unemployment benefits is governed under chapter 288 of the Missouri Revised Statutes, as well as the rules and regulations created by the Commission’s Division of Employment Security.[28]  The policy rationale behind unemployment benefits is to protect those unemployed “through no fault of their own.”[29]  These specific employment security laws are “liberally construed to accomplish [this] purpose.”[30]  Chapter 288 lays out certain exceptions that will disqualify an individual from receiving unemployment benefits, one of those being a situation where “the claimant has left work voluntarily without good cause attributable to such work or to the claimant’s employer.”[31] 
Under chapter 288, good cause is defined as “only that cause which would compel a reasonable employee to cease working or which would require separation from work due to illness or disability.”[32]  The statute should be construed “strictly and narrowly in favor of finding that an employee is entitled to compensation.”[33]  Whether an employee had good cause to voluntarily quit his employment is a question of law that the appellate courts review without deference to the Commission’s findings.[34]  Further, “[t]he burden to prove good cause rests on the party seeking benefits.”[35]  The claimant seeking benefits holds the burden of proving that he or she did, in fact, have good cause to voluntarily quit his or her employment.[36]
III.  Instant Decision

            Article V, section 18 of the Missouri Constitution permits Missouri appellate courts to provide judicial review of an administrative decision affecting private rights to determine if it is (1) “authorized by law” and (2) “supported by competent and substantial evidence upon the whole record.”[37]  While appellate courts must give deference to a commission’s finding of fact, they are nevertheless free to alter the commission’s conclusions of law or its application of law to the facts.[38]
The single issue raised by Piloski on appeal was whether he voluntarily quit his employment for good cause and “thus under circumstances that would compel a reasonable employee to cease working or which would require separation from work due to illness or disability.”[39]
Piloski contended on appeal that the Commission erroneously applied the law to the facts in finding that he did not have good cause to voluntarily quit his employment for four reasons.[40]  First, Piloski argued that a reasonable employee would quit if he knew work conditions were causing adverse health effects.[41]  Second, Piloski argued that up until August 2015, his employer had acquiesced for several years about where his work would be performed.[42]  Third, Piloski contended that there was a substantial change in his work conditions.[43]  Lastly, Piloski argued that the fume extractor was not a solution to the changing work conditions because his employer “knew the work load would require two welders to be working outside the clean room at the same time” and thus the proposed solution would not be feasible.[44]
As to Piloski’s first argument, the court held that Piloski could not establish that his work conditions were causing adverse health affects.[45]  In support of his argument, Piloski cited to a headache that he characterized as “swelling of the brain.”[46]  Because Piloski could not produce more than simply layperson testimony in support of this argument, the court found that he had not experienced adverse health effects due to work conditions, and therefore it was immaterial whether other employees in the same circumstance would quit due to knowledge of adverse health effects.[47]
Piloski’s second argument provided that his employer acquiesced for eight years regarding the location where Piloski’s work would be performed.[48]  The court quickly rejected this argument, relying on established case law providing that “a mere change in work duties is not sufficient in and of itself to support a finding of good cause.”[49]  Thus, the court concluded because changing work conditions in and of themselves does not support a finding of good cause, the fact that Piloski had worked primarily in the clean room for eight years was immaterial.[50]
Piloski’s third argument, that the change in his work conditions constituted a substantial change, was also rejected by the court.[51]  The court noted that while dissatisfaction with a change in work conditions may support a finding of good cause, the dissatisfaction must be based on a substantial change in working conditions.[52]  In Piloski’s case, the court found that the changes were not substantial to warrant a finding of good cause.[53]  The court noted that from October 2007 to August 2015, Piloski had never been afforded the luxury of refusing to work outside of the clean room.[54]  It was only until after his current employer acquired the business that Piloski agreed to work outside the clean room on request and without complaint.[55]  Therefore, the only changes cited by Piloski were that he began verbalizing his complaints to these requests to work outside the clean room and that the requests to work outside the clean room were being made on a more frequent basis and for longer durations than when he had originally started his employment.[56]  Therefore, because Piloski’s work conditions did not constitute a substantial change, he could establish good cause for voluntarily leaving his employment.[57]
Lastly, Piloski’s fourth argument, that his employer had no intention of carrying out his promise to provide Piloski with a fume extractor, was rejected by the court because Piloski could not offer any evidence to support his claim, stating that this suggestion was only speculative at best.[58]
IV.  Comment

            While the facts and circumstances surrounding this particular case seem to support the holding, the questions regarding policy rationale for unemployment benefits still remain. 
The specific laws in Missouri regarding unemployment security are aimed at protecting and safeguarding those employees who are facing unemployment through no fault of their own.  These laws are supposed to be “liberally construed” to achieve this purpose.[59]  However, upon further glance, the standard for establishing “good cause” for voluntarily leaving work seems a substantially high burden for a claimant to meet, given the fact that the laws are to be “liberally construed” in his or her favor.  Requiring such a high bar for claimants to meet in order to acquire unemployment benefits seems to result in a waste of administrative resources as claimants toil through numerous hearings just to be ultimately denied at the appellate court level.  Additionally, this hurdle of establishing “good cause” could result in employees remaining at jobs where they are unhappy and unfulfilled, leaving employers to question whether these employees will dutifully perform their jobs as required or whether they will shirk their responsibilities. 
Arguably, the opposite viewpoint to this high bar of establishing “good cause” is that public policy warrants employees to have valid reasons for leaving their jobs so that the moral hazard of leaving a job just to claim unemployment benefits will be reduced.  So, in order to avoid this moral hazard, it makes sense that good cause should not be an easily attainable burden. 
In order to reconcile the two countering viewpoints, however, the courts should possibly alter the definition for “substantial change” regarding workplace conditions.  If this standard is slightly lowered, but all of the other conditions to meeting the “good cause” standard are maintained, it is likely that claimants may fare better at the appellate court level, therefore not rendering the previous efforts in administrative hearings as wasteful, and it is likely that society will still be able to maintain a cap on the dangers of moral hazard in the realm of unemployment benefits.
- Sheaffer Fennessey

[1] Piloski v. Div. of Emp’t Sec., No. WD 79597, 2016 WL 6210823, at *1 (Mo. Ct. App. Oct. 25, 2016).
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] Id.
[8] Id.
[9] Id.
[10] Id.
[11] Id.
[12] Id. at *2.
[13] Id.
[14] Id.
[15] Id.
[16] Id.
[17] Id.
[18] Id.
[19] Id.
[20] Id.
[21] Id.
[22] Id.
[23] Id.
[24] Id.
[25] Id.
[26] Id.
[27] Id.
[28] Mo. Rev. Stat. § 288.040 (Cum. Supp. 2013).
[29] Piloski, 2016 WL 6210823, at *3 (alteration in original); Mo. Rev. Stat. § 288.020.
[30] Piloski, 2016 WL 6210823, at *3; Mo. Rev. Stat. § 288.020.
[31] Piloski, 2016 WL 6210823, at *3; Mo. Rev. Stat. § 288.020.
[32] Mo. Rev. Stat. § 288.050.1(1).
[33] Piloski, 2016 WL 6210823, at *3.
[34] Id.; Mo. Const. art. V, § 18.
[35] Piloski, 2016 WL 6210823, at *3.
[36] Id.
[37] Id. at *2.
[38] Id. (noting that appellate courts have jurisdiction to “modify, reverse, remand, or set aside a decision of the Commission where ‘the facts found by the commission do not support the award; . . . there was no sufficient competent evidence in the record to warrant the making [or denial] of the award.’”) (alterations in original) (quoting Mo. Rev. Stat. §§ 288.210(3)–(4) (2000))
[39] Id. at *3.
[40] Id.
[41] Id.
[42] Id.
[43] Id.
[44] Id.
[45] Id. at *4.
[46] Id.
[47] Id.
[48] Id.
[49] Id. (relying on Kimble v. Div. of Emp’t Sec., 388 S.W.3d 634, 640 (Mo. Ct. App. 2013) and Darr v. Roberts Mktg. Grp., LLC, 428 S.W.3d 717, 728 (Mo. Ct. App. 2014)).
[50] Id.
[51] Id.
[52] Id. (relying on Reno v. Tyson Poultry, Inc., 204 S.W.3d 347, 351 (Mo. Ct. App. 2006)).
[53] Id.
[54] Id.
[55] Id.
[56] Id.
[57] Id.
[58] Id. at *5.
[59] Mo. Rev. Stat. § 288.020.2 (2000).