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Mongillo v. Board of Review


April 20, 2009


On appeal from the Board of Review, Department of Labor.

Per curiam.


Argued March 25, 2009

Before Judges C. L. Miniman and King.

This is an appeal from denial of an application for unemployment compensation benefits. Appellant was employed by the BURLINGTON COUNTY TIMES (TIMES) in the sale of retail advertising. The employer did not participate in the administrative process.

Appellant began working for the TIMES in April 1968. Her last day of work was January 25, 2008 when she was age 72. The TIMES notified its work force that it had decided to eliminate fifteen positions and sought volunteers to take severance packages. This package was offered to fifty-five out of its 150 employees. Appellant was the only person in the advertising department to receive an offer for a severance package. She was told that if the severance package inducement was unsuccessful, a total of fifteen employees would be eliminated "one way or another." Appellant was the senior person in her department. To her, the future was ominous if she did not accept the severance package.

Several months before the offer of a severance package the TIMES management had asked when appellant intended to retire. She told management she had no intention at all to retire. Plaintiff finally accepted the severance package and then applied for unemployment benefits. Her application was denied on the ground that there was insufficient evidence to support the requisite finding that she was in imminent danger of separation from employment if she chose not to accept the severance package.

The appeals examiner said this in denying appellant's claim.

The claimant's leaving of work because the severance package included a significant financial opportunity is a personal one. As the claimant never ascertained if her position was truly in jeopardy of being eliminated due to downsizing, there is no evidence that she was in imminent danger of being laid off if she chose not to accept the voluntary severance package. Considering the number of jobs eliminated, versus the number of total employees working for this employer, the chances of the claimant being laid off were quite slim. It was the claimant's responsibility to determine if continuing work would have been available to her by obtaining a direct answer from management. Unlike the aforementioned docket #179,312, the claimant made no efforts to do so. Therefore, the claimant is disqualified for benefits as of 01/20/08, under N.J.S.A. 43:21-5(a), as the claimant left work voluntarily without good cause attributable to such work.

In effect, he found appellant did not sustain her burden of proof.

The Board of Review agreed and stated:

On appeal to the Board of Review, the claimant's attorney argues that the record establishes that there was a very strong likelihood that the claimant would be imminently laid off if she did not accept the package and other individuals who accepted the package have been receiving benefits.

Mere speculation about job stability is insufficient to establish good cause to quit as required to recover unemployment compensation; rather, surrounding circumstances at the time of voluntarily resigning must demonstrate lack of suitable continuing work either concurrently or at discernible and proximate point in time; together with statements or actions of employer showing very strong likelihood of imminent layoff, and circumstances must be so compelling as to indicate that there is a strong possibility that fears about employee's job security will in fact materialize, that serious impending threats to his or her job will be realized; and that employees' belief that his or her job is imminently threatened is well founded. Fernandez v. Board of Review, 304 N.J. Super. 603 (App. Div. 1997).

As to others similarly situated who received benefits, the Board said:

Although other individuals are receiving benefits under similar circumstances, we must make a ruling based on the facts in the case before us. In this case, the claimant, by her own admission, was never informed that she would be laid off at any discernible point in time if she declined to accept the retirement package. There is no evidence that there was any serious impending threat to the claimant's employment or that there was a strong possibility that any fears she had about her job security would, in fact, materialize. Therefore, the claimant's resignation was without good cause attributable to such work. Hence, the claimant is disqualified for benefits as of October 14, 2007 in accordance with N.J.S.A. 43:21-5(a).

In plaintiff's counsel's brief filed with the Board he said this with respect to the claim of a disparate outcome in other cases.

There was a strong likelihood of imminent discharge (within 60 days) in this case; that is, 45 days. The Claimant's actions were not unreasonable nor disqualifying. If there is any doubt in the Board's mind, the matter should be remanded to the Appeals Tribunal for additional testimony of the employer concerning the specific number of employees notified, the number laid off who actually received the letter and the specific intent as to the Claimant.

It is unfair for others in the same position as the Claimant to receive benefits while she is being excluded.

We agree with appellant's position in this regard. She should have been allowed to reopen her case on this key point. Appellant makes a reasonably persuasive argument that at the time of the Appeal Tribunal hearing she had no reason to suspect that her employer would not participate and be available to provide evidence as to its intention, later manifested, to eliminate appellant's position.

As a result, appellant, without fault, was deprived of the opportunity to elicit testimony from the employer respecting its intention to eliminate plaintiff's position. We think that it was a mistake not to grant appellant's request because there is substantial indicia in this record of an intent to eliminate appellant's position. Her position was not filled after she separated from employment. Rather, her work was reassigned to other employees in the department. Other employees in the company had been told that their positions were being eliminated; they accepted the severance package, and then obtained unemployment benefits.

Appellant never asked management about its intention as to her job and thus had never been directly told that her position would be eliminated. Such fortuitous circumstances should not control the fate of appellant's right to benefits, especially where others similarly situated have prevailed.

We find the Supreme Court's instruction in Duvin v. State, 76 N.J. 203 (1978), in an analogous situation, helpful. An administrative agency clearly has the inherent power, absent legislative restriction, "to reopen or to modify and to rehear orders previously entered by it." Id. at 207. That power should be invoked only for good cause, exercised reasonably and the application to reopen must be made with reasonable diligence. Ibid. We conclude that these conditions are met here. The refusal to permit appellant to reopen her proofs was in the circumstance a mistaken exercise of discretion and we remand for testimony from the employer and further fact-finding by the Appeal Tribunal or the Board on this point -- the intent of the employer to eliminate appellant's position at the time the severance offer was tendered.

Reversed and remanded.


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