Judge: School corp.’s inattentiveness doesn’t support benefits reversal

The Indiana Court of Appeals was split Wednesday over whether a notice sent regarding a hearing on unemployment benefits required reversing the grant of benefits because the employer found the notice confusing.

The majority in Hamilton Heights School Corp. v. Review Board of the Indiana Dept. of Workforce Development and Sherri K. Stepp, and The Indiana Dept. of Workforce Development, 93A02-1210-EX-795, reversed the decision by the Review Board of the Indiana Department of Workforce Development to grant Sherri Stepp unemployment benefits. Stepp worked as a custodian for Hamilton Heights School Corp. when she was fired after an on-the-job argument with a co-worker.

An administrative law judge, through a telephone hearing in July 2012, affirmed that Stepp was ineligible for benefits. Stepp appealed to the review board, which ordered a new hearing because the July hearing was “inadvertently destroyed” before the board could review the ALJ’s decision. The notice sent for the August hearing indicated it would be held in person, but the notice and attached acknowledgement sheet and instructions also included conflicting information that suggested the hearing would be held by telephone.

The school corporation did not show up in person and tried to call in. The ALJ found that Stepp was entitled to benefits because the school corporation did not participate in the hearing.

“Where, as is the case here, a prior hearing was held telephonically and no party has requested an in-person hearing, the conflicting nature of the information contained in these documents and instructions could lead a reasonable person to believe that the hearing would be conducted telephonically,” Judge Cale Bradford wrote.

“It is especially troublesome that a party could participate in and be successful following a hearing, have that hearing vacated through no fault of its own, be prepared for and willing to participate in a subsequent hearing, and attempt to contact the ALJ when not contacted for the hearing, only to have a ruling issued against it for failure to participate.”

Bradford and Judge Elaine Brown reversed and remanded for a hearing on the merits.

Judge Patricia Riley dissented, pointing to inattentiveness on the part of the school corporation to assume the August hearing would be held by phone.

“We are therefore left with the following legal precedent: an employer is denied due process by failing to participate at an unemployment compensation hearing when such failure is caused by a) the employer’s reliance on procedures followed at a prior hearing and b) its confusion resulting from the language contained in the notice of a subsequent hearing,” Riley wrote, referring to the majority’s decision. “However, I am constrained to find a simple failure to read tantamount to a due process violation.”