This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2002).
STATE OF MINNESOTA
IN COURT OF APPEALS
Anton J. Kirnyczuk,
Commissioner of Employment and Economic Development,
Filed August 31, 2004
Robert H. Schumacher, Judge
Department of Employment and Economic Development
File No. 14635-03
Andrew R. Clark, Jason E. Engkjer, Kalina, Wills, Gisvold & Clark, P.L.L.P., 6160 Summit Drive, Suite 560, Minneapolis, MN 55430 (for relator)
Drill-A-Matic, Inc., 4099 White Bear Parkway, White Bear Township, MN 55110 (respondent)
Lee B. Nelson, Linda A. Holmes, Department of Employment and Economic Development, 390 North Robert Street, St. Paul, MN 55101 (for respondent Commissioner)
Considered and decided by Schumacher, Presiding Judge; Anderson, Judge; and Halbrooks, Judge.
U N P U B L I S H E D O P I N I O N
ROBERT H. SCHUMACHER, Judge
Relator Anton J. Kirnyczuk challenges the decision of the commissioner's representative that he quit his job without good cause, arguing respondent Drill-A-Matic, Inc. substantially altered the terms of his employment. We reverse.
Drill-A-Matic hired Kirnyczuk as a welder in 1989. He was paid hourly and did not receive sick leave or paid vacation. In July 1999, Drill-A-Matic promoted Kirnyczuk to shop foreman, with a salary of $42,000 annually, paid vacation, and sick leave. As shop foreman, Kirnyczuk's duties did not include actual production unless Drill-A-Matic was short staffed. Rather he focused on shop-floor management, project oversight, employee supervision, discipline and termination, and participation in management and production meetings.
In June 2003, Gerald Ture, owner and president of Drill-A-Matic, notified Kirnyczuk that it was necessary to eliminate his position as shop foreman, citing financial difficulties and Kirnyczuk's sub-optimal performance as shop foreman. Ture gave Kirnyczuk the option of being laid off and receiving four weeks of severance pay or being demoted to welding supervisor.
Kirnyczuk claims that such a demotion would have adversely affected his position at Drill-A-Matic, making him the equal of those whom he had spent the last four years supervising and disciplining. Kirnyczuk testified he was the recipient of hostility from the workers during the union de-certification period, which culminated in a threat on his and his son's lives. Ture, however, claims that new non-union workers had replaced all but one of the department employees and the staff from the union period.
Additionally, the new job would have entailed the loss of some of the benefits he received while he was shop foreman, namely his vacation and sick pay. His actual earnings would have dropped from a salary of $42,000 annually to approximately $41,000 annually computed at an hourly rate. Kirnyczuk chose to be laid off and took the severance pay.
Kirnyczuk filed for unemployment benefits with the Minnesota Department of Economic Security, which awarded him benefits. Drill-A-Matic appealed the determination, and the unemployment law judge affirmed, concluding that Kirnyczuk left his employment because of a good reason caused by Drill-A-Matic. Drill-A-Matic again appealed, and the commissioner's representative reversed, finding that Kirnyczuk did not quit his job because of a good reason caused by Drill-A-Matic.
This court reviews the decision of the commissioner's representative whose decision is accorded particular deference. Tuff v. Knitcraft Corp., 526 N.W.2d 50, 51 (Minn. 1995). The commissioner's representative's findings are reviewed in the light most favorable to the decision, and this court will not disturb them as long as there is evidence that reasonably tends to sustain those findings. Schmidgall v. Filmtec Corp., 644 N.W.2d 801, 804 (Minn. 2002). But the ultimate question of whether an employee has good reason to quit is a question of law reviewed de novo. Peppi v. Phyllis Wheatley Cmty. Ctr., 614 N.W.2d 750, 752 (Minn. App. 2000).
An employee who quits his employoment only qualifies to receive unemployment benefits if he or she "quit the employment because of a good reason caused by the employer." Minn. Stat. § 268.095, subd. 1(1) (2002). A good reason caused by the employer is one "(1) that is directly related to the employment and for which the employer is responsible; and (2) that is significant and would compel an average, reasonable worker to quit and become unemployed rather than remaining in the employment." Minn. Stat. § 268.095, subd. 3(a) (2002).
Kirncynuk contends that he quit his employment with Drill-A-Matic for good reason entitling him to employment benefits because there was a "substantial adverse change in the wages, hours, or other terms of employment." See Minn. Stat. § 268.095, subd. 3(c). Kirnyczuk addresses two basic issues, arguing that the fear of retaliation and the change in the terms of his employment both gave him a good reason to quit.
Since almost none of Kirnyczuk's former subordinates were employed at Drill-A-Matic at the time of his demotion, the commissioner's representative correctly concluded that Kirnyczuk's fear of retaliation was unfounded, his claim of "good reason" untenable, and that a reasonable person under the circumstances would not have quit their employment based simply on fear. See Ferguson v. Dep't of Employment Servs., 311 Minn. 34, 44 n.5, 247 N.W.2d 895, 900 n.5 (1976) (noting that "circumstances [compelling] the decision to leave employment must be real, not imaginary, substantial not trifling, and reasonable, not whimsical; there must be some compulsion produced by extraneous and necessitous circumstances.").
The commissioner's representative did not, however, address the issue of the substantial adverse change in the terms of Kirnyczuk's employment. In Cook v. Playworks, this court outlined the proper inquiry into the impact of changes in job duties resulting from unsatisfactory job performance. 541 N.W.2d 366 (Minn. App. 1996). We stated in Cook that the commissioner's representative is to consider the totality of the circumstances when an employee is being demoted, specifically the "loss of wages, the extent of the change of job duties, the reasonable career expectancies of the employee because of tenure . . . and the employee's remaining chances for advancement after the demotion." Id. at 369; see also Minn. Stat. § 268.095, subd. 3(c) (2002) (stating "substantial adverse change in wages, hours, or other terms of employment by the employer shall be considered a good reason caused by the employer for quitting").
Particularly convincing is the shift from salary to hourly pay. After Kirnyczuk's demotion, he would not get paid if he went to lunch, went on vacation, or went to get a check-up with his doctor. Further, he would not get paid if Drill-A-Matic shut down for a day, or even a week, for reasons beyond his control. He also would lose $1,000 annually in wages and three weeks of vacation.
Taken together, the changes in the terms of Kirnyczuk's employment are substantial. See Rootes v. Wal-Mart Assocs., Inc., 669 N.W.2d 416, 419 (Minn. App. 2003) (concluding considerable change in hours when coupled with wage reduction was substantial adverse change under Minn. Stat. § 268.095). Therefore, we conclude that the commissioner's representative erred in determining that Kirnyczuk quit his employment without good reason caused by the employer.