Florida District Court of Appeal Holds That Violation of Company Policy Not Sufficient to Deny Unemployment Compensation Benefits
I am very happy to report that we prevailed last week on an unemployment compensation appeal for a client that was denied unemployment benefits because of a violation of company policy. The Florida Third District Court of Appeal, which sits in Miami, Florida, decided that a violation of company policy, which also was a violation of federal regulations, was not sufficient to deny a fourteen-year employee unemployment compensation benefits. Attached to this link is the full Opinion of the Court in Hernandez v. Florida Unemployment Appeals Commission, Docket No. 3D09-3326 (Fla. 3d DCA July 2010).
In that case, Ms. Hernandez, the employee, worked as a customer account specialist for American General Finance, one of the largest loan companies in the country. Sometime prior to her discharge, she processed a loan for a customer. When the customer took out the loan, he was with a third party and according to the evidence, the customer and the third party were very close friends. Subsequently, the third party came in and requested an increase in the amount of loan, which Ms. Hernandez duly processed. However, she failed to obtain the approval of the customer or the customer's signature on any of the loan increase papers. The customer found out about it and when he complained, that's when Ms. Hernandez was fired. The company claimed that it was a violation of company policy and a violation of federal regulations. However, Ms. Hernandez had never been given a reprimand or warning for this or any other type of conduct during her entire 14-year tenure with the company. Nevertheless, the Appeals Referee determined that this was misconduct as defined in the unemployment law and denied unemployment compensation benefits. The Unemployment Appeals Commission affirmed.
At oral argument before a panel of three judges of the Third District Court of Appeal, we argued that this was an isolated incident of a lapse of judgment that should not rise to the level of being "misconduct" as defined by the unemployment law. The Unemployment Appeals Commission ("UAC") argued that the conduct was so egregious that it was tantamount to a willful and wanton disregard of the employer's interests. The UAC cited several opinions for this proposition, such as the case of Sears & Roebuck v. Florida Unemployment Appeals Commission, 463 So.2 465, (Fla. 2d 1985), where an employee was denied unemployment benefits because of a clear violation of company policy, which also included a violation of law. However, I argued to the judges that the cases cited by the UAC involved situations where the employee garnered a benefit from the conduct. In the case before the Court, the employee received no benefit whatsoever. As such, it was a simple error in judgment. The Court agreed and found that one incident of poor judgment exercised by Ms. Hernandez over a fourteen-year career with the employer, does not rise to the level of being misconduct as defined by the unemployment law.