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Miscellaneous New Precedent Cases - Maryland Unemployment Decisions Digest - Appeals

I. Extended Benefits – Section 8-1101, 8-1108

A. Additional Job Search Requirements Met – Claimant Not Responsible for Delivery of Mail.
NewThe claimant became eligible to receive extended benefits in Maryland effective November 6, 2011. The Agency advised the claimant that she was classified as having “not good” job prospects, which meant she was required to make a “sustained and systematic” search for work. The claimant had a copy of her work search logs for one week and provided ample and specific information about her work search. However, the claimant did not have the details about her work search for the following weeks because she had mailed the information to the Agency. The Agency had no record of receiving this. The Board found that the claimant credibly testified that she was actively seeking employment during the entire period in question. She testified that she was making multiple job contacts each week. She could not recall the companies to which she sent resumes, or the dates upon which she did that. The Board does not find it damaging to the claimant’s credibility that she could not remember these details. The statute does not require the claimant to assure receipt of the work search logs. It does not require hand-delivery. The claimant credibly testified that she caused the work search logs to be mailed to the Agency. The Board will not hold the claimant responsible for the completed delivery of the logs. The Board held that the claimant did make a systematic and sustained search for work during weeks in question. Massaquoi, 2605-BR-12.

NewThe claimant became eligible to receive extended benefits in Maryland effective October 2, 2011. The Agency advised the claimant that she was classified as having “not good” job prospects, which meant she was required to make a “sustained and systematic” search for work. The Agency further advised that, under the Agency’s interpretation, a “sustained and systematic” search for work means the claimant must search for work on at least three days per week and make a total of at least four work search contacts each week. From October 9, 2011 through October 15, 2011, the claimant did not make any job contacts because she was hospitalized during this time. From October 16, 2011 through November 12, 2011, the claimant made four job contacts per week, but failed to give specific names of the employers. The claimant gave fax numbers and e-mail names. The Board found that clearly the claimant was not eligible for benefits the week ending October 15, 2011. The claimant was not aware that she should have closed and reopened her claim, but she should not be punished for this. The claimant reasonably believed she was required to complete the telecert for each week during her claim. With respect to the other weeks, the Board held that there is no requirement for any specific details concerning the work search. The claimant was not asked to provide names, addresses, telephone, fax and e-mails. She was asked to provide verification that she had made at least four job contacts each week following October 16, 2011. The Board finds that the claimant complied with the Agency’s request and with requirements for continuing eligibility. Finney, 5634-BR-12.

B. Prior Disqualification Ended – Extended Benefits Allowed
NewThe claimant became eligible to receive extended benefits in Maryland effective October 2, 2011. Prior to this, on June 30, 2010, the claimant was disqualified from receipt of regular unemployment benefits between March 21, 2011 and April 24, 2011 pursuant to a finding that the claimant had voluntarily quit her job for reasons that constitute a valid circumstance. Since that time, the claimant has been employed as a babysitter. The claimant has submitted all documents required of her to receive extended benefits. The Board held that the claimant, who was disqualified from regular unemployment benefits for a period of weeks pursuant to Section 8-1001, has worked since the disqualification period ended and provided all the required documentation to the Agency. Therefore, pursuant to Section 8-1104(e), extended benefits are allowed. White, 3526-BH-12.

II. Request by Appealing Party to Re-open Dismissed Appeal – COMAR 09.32.11.02(P)

A. Petition to Reopen Must Be Timely Filed – No Provision for Good Cause to Be Late
NewThe claimant filed a petition to reopen a dismissed case over seven days past the date of the dismissal decision. The claimant has not established by a preponderance of the evidence that she is entitled to reopening the dismissed case under the reasons enumerated in COMAR 09.32.11.02 (O) now (P). There is insufficient evidence that the reason for the dismissal is attributable to Agency error, an error by the United States Postal Service, an unforeseen and unavoidable emergency, or for reasons relating to an improperly denied postponement request. A failure to request a reopening within the specified time provision of seven days of the date of the dismissal notice may lead to a denial of the petition to reopen. The law does not provide for consideration of good cause for filing a late petition to reopen a dismissed case. The Board held that the claimant failed to file a timely petition to reopen the dismissed case. Therefore, the claimant failed to meet her burden of demonstrating that she had good cause to reopen the dismissed appeal. Gross v. University of Baltimore, 2009-BR-12.

III. Due Process

A. Neutrality Essential
New The Agency initially failed to appear within the customary 10-minute grace period after the noticed hearing time and prior to any testimony or evidence being taken at the hearing. The claimant was present, but the employer failed to appear. The hearing examiner intentionally sought out the Agency, a party before the Lower Appeals Division, to attend and present evidence of the contested hearing. The Agency representative then appeared. The Board of Appeals finds on the facts of this case that the claimant’s due process rights were violated. The Board of Appeals held that the hearing examiner may only seek to have a non-appearing party or its witness appear for the hearing when (after notice of the continuance of the hearing) after the course of the hearing, the hearing examiner determines there is no evidentiary basis upon which to render a decision within the meaning of Maryland Code Annotated, Labor and Employment Article, Section 8-508(c)(2) and (c)(3). Under the COMAR regulations and the Lower Appeals Division’s stated procedural policies, an appearing party’s due process rights are violated, and an appearance of bias by the hearing examiner is evinced, when a hearing examiner unilaterally seeks out an adverse party prior to hearing the testimony and evidence of the appearing party and prior to a determination that there is an insufficient evidentiary basis upon which to render a decision. In this case, the claimant’s due process rights were violated and the hearing examiner’s violation of the Lower Appeals Division’s policy prohibiting the hearing examiner from contacting non-appearing parties unduly prejudiced the claimant. The evidence in the record is tainted. There being insufficient evidence, the Agency did not meet its burden of proof on the issues in this case. The Board of Appeals finds in favor of the claimant. McKeown v. Locust Industries Limited, 5277-BH-12.

NewIn this case, the claimant appeared at the hearing, but the Agency representative did not. The hearing examiner did not “seek out” the Agency representative. The hearing examiner properly moved forward with the hearing at the behest of the claimant. Once the claimant proceeded with his testimony that the benefit determination contained incorrect information, the hearing examiner properly indicated that it was incorrect and that the matter needed to be continued to remedy the material defect in the record. The claimant did not object to and agreed with the continuance. Consequently, another hearing date was noticed and both the claimant and Agency representative appeared. The Board of Appeals distinguished the McKeown case, where it found that the claimant was unduly prejudiced by the Lower Appeals Division’s unilateral action to call the Agency for a representative to appear. In the instant case, the claimant’s due process rights were not violated, but instead were preserved because of the incorrect issues noted on the benefit determination. The Board of Appeals finds that the claimant’s case was not prejudiced and his due process rights were not violated. Additionally, the Board of Appeals finds that the claimant was without fault for the overpayment. However, the claimant’s income is not below the Federal minimum poverty level. The claimant’s income is in excess of that amount. The claimant is 31 years old and is currently employed. There is insufficient evidence that the claimant is so financially indigent that he cannot pay the overpayment now or in the foreseeable future. The Board of Appeals held that the claimant has not met his burden of demonstrating that he qualifies for a waiver of his overpayment pursuant to COMAR 09.32.07.05. Cuccolo , 1277-BR-13.

NewThe decision was based on hearsay evidence. The employer was not present at the hearing. The claimant denied that the wages that were reported by the employer were accurate. He specifically acknowledged that he did not know how much he was earning. He reported what he believed were his wages to the best of his knowledge and ability. The Board of Appeals found that the claimant did not intentionally underreport his wages in order to increase his benefits. The Board of Appeals is unwilling to take as absolute evidence the testimony of the Agency representative merely reading the reported wages of the employer into the record. The Agency has the investigative authority to provide the Board of Appeals and the Lower Appeals Division with the appropriate accurate evidence. Reading the information from the Agency’s Fact Finding Report, without accurate documentary evidence to verify the wages, is not enough for the Agency to meet its burden of proof. The Agency’s case fails for lack of accurate wage information. The Board of Appeals held that the Agency failed to meet its burden of proving that the claimant knowingly and intentionally misreported his earnings. The Board of Appeals further found that the Agency failed to meet its burden of establishing the claimant was overpaid. Kelly v. Baltimore City Community College, 5920-BR-12.

B. Unemployment Status – Corporate Officer Status
NewA claimant's status as a corporate officer does not, in and of itself, disqualify the claimant under Section 8-801. However, it is appropriate to closely examine the eligibility of corporate officers under Section 8-903. Gleason v. William J. Gleason and Sons, Inc., 1033-BH-81.

C. Claimant’s Own Business
NewOnce it is shown that a claimant performed services for his own business and that the business grossed substantial income, the burden is on the claimant to show that none of the business receipts have gone to reimburse himself for the personal services performed on behalf of the business. Failing this, the Board may find that remuneration was made to the claimant. Witt, 550-BH-83.

NewIf a claimant both owns a business and performs any services with regard to that business, the burden is on the claimant to show that the gross profit of the business is not attributable to his services. But where a business has operated for 20 years without the claimant's substantial involvement, and where it has produced a monthly income of $340 based primarily on the services of its one full-time employee, and where the claimant performed no services in many weeks and a maximum of four hours of services in other weeks, the company earnings were not attributed to the claimant's services, and no disqualification was imposed under Section 8-801. Eaton, 571-BR-86.

D. Monetary Eligibility
New The claimant was a full-time insurance producer/agent for the Monumental Life Insurance Company. Monumental is a Section 8-101(b) base period employer for the claimant’s benefits claim. As compensation for his services and sales efforts, the claimant received the standard “pooled” sales commission; a “non-pooled” commission; renewal commissions; and quality performance bonuses. The claimant also received the following remuneration: a “Small Agency Subsidy”; employer-paid short-term disability insurance; employer-paid long-term disability insurance; employer-paid basic life and accident insurance; an employer-paid pension benefit and two weeks’ paid vacation. The Board of Appeals cited the case of Peoples Life Insurance Company v. Maryland Department of Employment Security, 256 Md. 350 (1970) as controlling. In that case the Court of Appeals held that the services were covered employment since “combination (insurance) agents” did not receive their compensation solely from commissions and they received “wages” as defined in the Maryland Unemployment Insurance Law. The agents received compensation from both commissions and expenses, and expenses received constituted wages under the applicable statute. The Board of Appeals held that the same result was warranted in the Grimes case because the claimant received the “Small Agency Subsidy” and the other enumerated employer-paid benefits. The Board also found that the Agency improperly assigned the burden of proof to the claimant, instead of applying the statutory presumption of employment in the absence of “information otherwise.” The Agency’s case was substantially hearsay. The Agency’s case is limited to its investigation or audit prior to issuing its determination. To allow the Agency to substitute new evidence not considered in the audit and for which the parties have no notice is a violation of the employer’s and the claimant’s due process. The Agency’s “day before the hearing” investigation practice is prejudicial to both the employer and the claimant, who must have sufficient advance notice in order to prepare their respective cases. There is insufficient evidence that the Agency sufficiently employed its investigatory powers prior to rendering its determination in this case. Grimes v. Monumental Life Insurance Company, 2741-BH-14.

NewThe Board finds that the hearing examiner exceeded the subject matter jurisdiction conferred by the benefit determination and Notice of Hearing. The Board limits its review of this matter to the evidence relevant to the factual issue or issues before the hearing examiner. In this matter, the factual issue concerned only the claimant’s ability to work; whether she was restricted from working by her physician. The evidence established that the claimant was restricted from working as a driver because of panic or anxiety. The claimant had no other restrictions and was fully able to work in a variety of occupations including retail sales, in which she was seeking work. The Board disregards the hearing examiner’s inquiries into the claimant’s availability for work and her work search. Both of these factual issues are beyond the scope of the factual issues for which the claimant was given notice. Benefits are allowed from the week beginning September 9, 2012. Savoy v. MV Transportation, 1750-BR-13.

NewThe Notice of Hearing included aspects which were beyond the benefit determination. The claimant did not have actual notice of the factual issues which would be adjudicated. The claimant could not reasonably have been expected to present competent evidence of any factual issue beyond her ability to work. The Board limits the scope of this decision to that issue. The claimant has been seeking work as a dental assistant and as a medical assistant. The claimant was restricted by her doctor from working May 4, 2012 through July 6, 2012. She was not eligible for benefits during that time. The hearing examiner erred in initiating the claimant’s ineligibility on April 30, 2012. The claimant was able to work for the majority of that week. Her restriction began on Friday, May 4, 2012; her ineligibility should have begun on Sunday, May 6, 2012. If the claimant has limitations on her availability or has not conducted an adequate work search, the Agency must adjudicate those factual issues and issue a benefit determination, or determinations, before any hearing may be held. The claimant is disqualified from benefits from the week beginning May 6, 2012 until the week ending July 7, 2012. Evans, 860-BR-13.

NewThe original benefit determination, from which the claimant appealed, held her to be ineligible for benefits due to her attendance at school. The claimant came to the hearing prepared to present evidence on that issue. The hearing examiner expanded the scope of the hearing to cover the claimant’s job search and required the claimant to submit written documentation in support of her testimony. The Board finds that the hearing exceeded the scope of the notice and therefore was violative of the claimant’s due process rights. The Board notes that the Notice of Hearing does state that included in the issue is the question of whether the claimant is actively seeking work. Technically, the claimant was on notice that her work search could be an issue. However, the Board does not find technical notice to be the same as actual notice. The claimant was not actually apprised that her work search would be called into question. The claimant did not have a fair opportunity to be prepared to answer the hearing examiner’s questions in that regard. Further, the claimant did submit copies of her job contacts. Those were not apparently received or considered prior to the issuance of the decision. The evidence established that the claimant has not restricted her availability. Her classes were in the evenings and on weekends. The claimant was seeking several different types of work in which positions are available all hours of all days. No claimant is required to be available for work 24 hours of all seven days each week. The claimant was available for work during the majority of the hours of the majority of dates. The Board is satisfied that the claimant was available as required by Section 8-903. Rhodes, 709-BR-13.

E. Self-Authenticating Agency Records
NewThe Hearing Examiner admitted into the record sixty-three (63) pages of assorted documents, including photocopies of pictures, policies and procedures, and documents solely related to the claimant’s separation from employment. The Hearing Examiner admitted these documents pursuance to COMAR 09.32.11.02 (J) (3), which states, in pertinent part:

For purposes of an appeal from a claims examiner’s determination, the official Agency record shall consist of the appeal letter and envelope or other evidence showing its manner of submission, and the Agency Fact-Finding Report.

The Hearing Examiner shall admit the Agency record, including the Agency Fact-Finding Report, into evidence at the hearing, without the need for an Agency representative to appear at the hearing to authenticate or introduce it. The Hearing Examiner shall consider the Agency Record when making a final decision, giving weight to the Agency Fact-Finding Report that the Hearing Examiner deems appropriate.

The purpose of admitting the self-authenticating Agency Record documents is to show how the matter reached the Lower Appeals Division. The Agency Fact-Finding Report includes the investigative matter which the Claims Specialist used to make the Benefit Determination. The Benefit Determination prompted one of the parties to file an appeal and the appeal letter and envelope or other evidence showing its manner of submission, show how and when the party filed its appeal. These procedural documents track the matter’s progress through the Agency and are not dispositive of the substantive issue before the Lower Appeals Division Hearing Examiner.

Conversely, the aforementioned sixty-three (63) pages which were attached to the employer’s appeal letter relate solely to the substantive issue before the Hearing Examiner. They do not evidence the progress of the matter through the Agency and are not specifically enumerated in COMAR 09.32.11.02 (J) (3). The claimant did not receive a copy of these documents in advance of the hearing and had no idea they were attached to the employer’s appeal letter and, by inclusion in the “Agency Record,” the claimant could not make a meaningful objection to their admission. In essence, the employer “boot strapped” its entire case onto an exhibit which the claimant never saw and which the Hearing Examiner must admit as an exhibit and consider when rendering a decision.

This process runs contrary to the rules of evidence, even under the reduced standards of administrative proceedings, and perverts the course of justice. Had the Legislature intended for all documents submitted along with “the appeal letter and envelope or other evidence showing its manner of submission” to become part of the record, it would have added the language “and all attachments thereto.”

Because the Legislature did not so include such inclusive language and because the Lower Appeals Division’s expansive interpretation of COMAR 09.32.11.02 (J) (3) grossly advances the cause of the appellant, at the expense of the appellee, the Board holds the only documents admissible under self-authenticating powers of COMAR 09.32.11.02 (J) (3) are those expressly included in the section: (1) The appeal letter and envelope or other evidence showing its manner of submission, and (2) The Agency Fact-Finding Report. All other documents attached thereto must be offered by the respective party, as part of its evidentiary presentation, and must comply with the “Instructions for Telephone Hearings” set forth on the reverse side of the Unemployment Insurance Telephone Hearing. Tyner V. Mayor’s Office City of Baltimore, Appeal no. 1808104.

F. Recording Dismissed Cases
NewThe claimant filed a timely appeal to the Board of Appeals from a Denial of Petition to Reopen, issued on March 5, 2019. A review of the Lower Appeals Division Hearing Recording reveals the Hearing Examiner failed to make a recording of the January 15, 2019, Telephone Hearing. Absent a complete record, the Board of Appeals cannot fulfill its function to consider and decide appeals from the Decisions of the Lower Appeals Division, as set forth in Maryland Code Annotated, Labor and Employment Article, Section 8-5A-01, et seq. The Hearing Recording is necessary to prove the claimant failed to call in for the January 15, 2019, Telephone Hearing. Without the recording there is not proof the claimant failed to call in for the hearing and the appeal was properly dismissed. Without evidence of a proper dismissal, the Board cannot confirm the matter was properly dismissed and the Denial of Reopening was appropriate. Weisel v. Kaimetrix LLC, Appeal no. 1818936

IV. Burden of Proof

A. Unemployment Status – Section 8-801
NewOnce it is shown that a claimant performed services for his own business and that the business grossed substantial income, the burden is on the claimant to show that none of the business receipts have gone to reimburse himself for the personal services performed on behalf of the business. Failing this, the Board may find that remuneration was made to the claimant. Witt, 550-BH-83.

B. Timely and Valid Appeal – Sections 8-806, 8-805, and 8-5A-10
NewThe appellant has the burden of proving when the appeal letter was mailed. The appellant has not met that burden when the only evidence provided on the issue is an affidavit from the appellant's representative. This person was not present to be cross-examined. The affidavit was vague concerning the mailing procedures used by the appellant, and it was insufficient to establish definitely that the envelope was deposited in the mail in the regular course of business on a specific day. The mailing procedure was not set out in any detail, nor was it proven that the procedure was a fixed routine. Taylor v. AT and T Company, 1019-BH-92.

NewFrom July 2008 through July 2010, the claimant worked two days a week or less as a cashier at the employer’s recreational center. For each of the weeks the claimant filed for benefits, she accurately reported her weekly wages for a part-time position. Hearsay evidence was the basis of this decision. There’s no evidence, other than the Agency Fact-Finding Report, of the claimant’s actual wages reported by the employer. The claimant credibly testified that the wages that she reported were the wages that she earned. There’s no other evidence in the record to dispute that the wages the claimant reported were incorrect. Therefore, it is impossible to hold the claimant overpaid. It is the Agency’s responsibility to present the accurate wage information. The Agency failed to show up to two hearings and failed to present the accurate wage information. The claimant was unemployed pursuant to Section 8-801. There is no evidence to show whether the claimant’s earnings were higher than those she reported, thus making her ineligible to receive benefits and overpaid pursuant to Section 8-809. In this case, the benefit determination was made on August 26, 2011, more than three years past the claimant’s 2008 benefit year. Any claims of the Agency that arise prior to August 26, 2008 are barred by the three-year statute of limitations in Section 8-809(e)(2). Diehl v. Montgomery County Government, 5226-BR-12.

NewThe claimant voluntarily quit her job after the employer failed to pay 100% of her health insurance coverage as promised. The claimant had discussed the specific employment conditions relating to the insurance with Lou Grasso, a current employee. Mr. Grasso was subpoenaed for each of the appeal hearings and failed to attend either. In light of Mr. Grasso’s failure to attend the appeal hearing after being subpoenaed, the claimant proffered that that he had assured her that she would have health insurance and that the employer agreed to pay 100% of her health insurance benefits. There is nothing to impeach the claimant’s testimony. Therefore, the Board finds that the claimant voluntarily quit for good cause when her employer failed to meet the terms of her employment agreement that required the employer to pay 100% of her health insurance premiums. Marques v. Matrix Marine Group LLC, 217-BR-15.

NewThe Agency has the burden of proof in cases involving overpayment under Maryland Code Annotated, Labor and Employment Article, Section 8-809(a) and fraud under Sections 8-809(b), 1301 and 1305. In the Lower Appeals Division hearing, the appellant/claimant had the burden of moving forward; however, the burden of proof remained with the Agency. The Agency, although duly notified of the hearing, failed to appear. By electing not to participate, it assumed the risk of an adverse decision. The Board and the Lower Appeals Division must treat the Agency consistent with its treatment of employers and claimants and cannot afford it any more or any less substantive or procedural due process rights. Agency documents, even if they were admitted into evidence, are hearsay and should be given little if any weight. In this case, Agency documents were not in evidence and therefore, were not considered by the Board in its review. Without Agency documentation raising the issue of whether the claimant has or has not reported wages, the Agency failed its burden of putting on a prima facie case. It is not the claimant’s burden, duty or obligation to prove the Agency’s case. The claimant’s statements do not support a finding that the claimant was overpaid or committed fraud in order to obtain or increase benefits to which he was not otherwise entitled. The Board holds that the claimant did not knowingly make false statements or knowingly fail to disclose material facts to obtain or increase benefits within the meaning of Maryland Code Annotated, Labor and Employment Article, Sections 8-809(b), 1301, and 1305. Brown v. Manpower International, Inc., 3106-BR-09.

V. Continuous Part-Time Employment – Section 8-611(G)

A. Continuous Part-Time Employment where the employments were concurrent
NewSection 8-611(g) provides that the Secretary may not charge the earned rating of the employing unit that has employed claimant on a continuous part-time basis and continues to do so while the claimant is separated from other employment and is eligible for benefits because of that separation. The claimant has been and is presently employed on a continuous part-time basis as a housekeeper for the employer. The claimant is eligible for and has been collecting unemployment insurance benefits due to her separation from employment from another employer. The current part-time employer’s account may not be charged. Charles B. Kaprielian, 3-SE-11(2011).

B. Continuous Part-Time Employment where the employments were not concurrent
NewSection 8-611(g) provides that the Secretary may not charge the earned rating of an employing unit that has employed a claimant on a continuous part-time basis and continues to do so while the claimant is separated from other employment and is eligible for benefits because of that separation. Where the prior full-time employment resulted in a non-disqualifying separation, and the claimant sought and found part-time employment, the new part-time employer’s experience rating account shall not be charged. Expresso Expressions, 48-SE-14.

VI. Successor Corporation – Section 8-613
Sam Negabahn started the company Brawner Builders, Inc. in 2007. He engaged MBP Management for administrative, payroll and office support services in addition to providing mentoring. MBP is a three-person partnership which provides these types of services to new businesses. All employees of Brawner Builders were paid through MBP, but managed, directed and controlled by Mr. Negabahn, who was the sole shareholder, owner and operator of Brawner Builders. When Mr. Negabahn applied for an unemployment insurance account, he listed two of the partners of MBP as corporate officers on his registration form. Neither man had any actual management role in Brawner Builders. In 2009, Mr. Negabahn took all personnel matters “in house” and discontinued his relationship with MBP. The employees were shown as “transferred” from MBP to Brawner Builders. The Board found that the two MBP partners were corporate officers of Brawner Builders and as such, were indicative of common ownership, management and control under COMAR 09.32.01.21C. The workers were transferred on paper from MBP Management to Brawner Builders, Inc. Brawner Builders, Inc. had corporate officers in common with partners of MBP. The Board found that Brawner Builders is thus, a successor employer for unemployment insurance tax purposes. The Board held that the tax rates for Brawner Builders were properly calculated for calendar years 2009 through 2014. Brawner Builders, Inc., 64-SE-14.