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Gardner v. District of Columbia Department of Employment Services

District of Columbia Court of Appeals

August 26, 1999


Before Terry and Ruiz, Associate Judges, and Pryor, Senior Judge.

The opinion of the court was delivered by: Ruiz, Associate Judge

On Petition for Review of a Decision of the District of Columbia Department of Employment Services

Submitted March 9, 199

Petitioner Bruce Gardner challenges a decision of the Department of Employment Services (DOES) denying him unemployment compensation benefits for the period of June 8, 1997 through June 28, 1997, pursuant to D.C. Code § 46-108 (e) (1996), *fn1 because Gardner's lump sum severance payment, representing four weeks of salary, when divided into weekly sums, exceeded the amount of weekly benefits which Gardner would have been otherwise eligible to receive. Gardner concedes that the severance payment was to have represented one month of salary beginning with his May 30, 1997 termination date. However, he contends that because he did not actually receive the severance payment until July 7, 1997, the deduction provided for in § 46-108 (e) was inapplicable, and he was entitled to unemployment benefits for the requested period. Gardner further argues that because § 46-108 (e) is limited to the benefit week in which he actually get the severance payment, he was additionally eligible for unemployment benefits for the period from July 13, 1997 to August 2, 1997. Finally, Gardner asserts that his failure to receive a hearing before the appeals examiner on the merits of his benefits claim denied him due process. We affirm.


Petitioner Gardner is a former attorney for the District of Columbia whose position was terminated on May 30, 1997. His letter of termination stated that Gardner would "receive a lump sum termination payment that will be equivalent to an additional four (4) weeks salary." On June 13, 1997, after still not having received the promised severance payment, Gardner began to file for weekly unemployment benefits, with the first claim effective the week ending June 8, 1997. *fn2 On his benefits application, Gardner indicated that he would receive severance pay equal to $929 per week for the period between May 30, 1997 and June 28, 1997. Gardner actually received the severance payment in a lump sum on July 7, 1997, almost forty days after he was discharged.

On July 28, 1997, Gardner visited the DOES office to inquire as to why he had not received unemployment benefits for the month of July. At this time, Gardner signed a fact-finding report which stated:

"[T]he severance pay was for a four week period starting with the May 30, 1997 termination date. I received one check for all the severance pay during the 2nd week in July. I am not entitled to any additional severance pay and I have not received claim forms for unemployment since the latter part of June."

To date I have not received any unemployment benefits. *fn3

On August 7, 1997, the claims examiner issued a decision stating that Gardner was not entitled to receive unemployment benefits for the period between June 8, 1997 and June 28, 1997, because pursuant to D.C. Code § 46-108 (e), eighty percent of Gardner's weekly severance pay exceeded the total weekly benefit amount that Gardner had been eligible to receive ($309), plus twenty dollars. *fn4 Gardner appealed the claims examiner's determination, and a hearing on his appeal was scheduled for September 16, 1997. On that date, the hearing took place as scheduled, but Gardner failed to appear. *fn5

As Gardner did not appear to present any additional evidence in support of his claim, the appeals hearing examiner based her decision solely on the claims record and affirmed the claims examiner's determination that the lump sum severance payment had rendered Gardner ineligible to receive unemployment benefits between June 8, 1997 and June 28, 1997. After receiving the September 17, 1997 appeals decision, Gardner mailed a letter to the Office of Appeals and Review (OAR) on September 20, 1997 contesting the appeals hearing examiner's decision and requesting a new appeal. Gardner explained his absence from the hearing:

"I inadvertently thought the hearing date was Friday, September 19th as opposed to Tuesday, September 16th. I realized my error on Thursday, September 18th and brought it to the attention of your office. I was informed the decision had been rendered and I would have any [sic] opportunity to have a new appeal date set."

By proposed final decision dated October 17, 1997, OAR affirmed the decision of the appeals examiner, concluding that her findings of fact and Conclusions of law were supported by substantial evidence in the record. After receiving objections to the proposed final decision from Gardner, *fn6 OAR issued a final order affirming the appeals examiner's decision, concluding that Gardner had received proper notice of the hearing, and that his absence from the hearing was a result of his own mistaken belief that the hearing was scheduled at a later date.


Gardner asserts that the applicability of D.C. Code § 46-108 (e), and hence his entitlement to unemployment compensation benefits for the period between June 8 and June 28, 1997, is contingent on whether he had received the severance payment during the week for which he sought unemployment benefits. Thus, because he did not receive the District's severance payment until July 7, 1998, he contends that he was entitled to unemployment compensation benefits without any reduction for the severance payment prior to that time. Similarly, Gardner argues that he is entitled to receive benefits also for the period after the week of July 7 in which he received the severance payment. According to Gardner, § 46-108 (e) reduces benefits only during the week a claimant actually received an offsetting payment. We reject this argument.

"Under the District of Columbia Administrative Procedure Act (DCAPA), D.C. Code §§ 1-1501 et seq. (1992), we must sustain the decision of the agency unless it is unsupported by substantial evidence in the record." Washington Times v. District of Columbia Dep't of Employment Servs., 724 A.2d 1212, 1216 (D.C. 1999) (citing Wallace v. District Unemployment Compensation Bd., 294 A.2d 177, 178-79 (D.C. 1972)). Substantial evidence is "'more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a Conclusion.'" Wallace, supra, 294 A.2d at 179 (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229 (1938)). We defer to "an agency's reasonable construction of a controlling statute or regulation." Selk v. District of Columbia Dep't of Employment Servs., 497 A.2d 1056, 1058 (D.C. 1985).

Gardner relies on Dyer v. District of Columbia Unemployment Compensation Bd., 392 A.2d 1 (D.C. 1978), where this court held that "[i]n order to be 'unemployed' and be eligible for compensation under the [District of Columbia Unemployment Compensation] Act, an individual must not have performed any services or received any earnings during the period." Id. at 3; see also D.C. Code § 46-101 (5). Accordingly, Gardner argues that because he did not work or receive any payments during the period between June 8 and June 28, 1997, or during the period between July 13, 1997 to August 2, 1997, he was "unemployed" for purposes of the statute, and therefore entitled to unemployment benefits during those time periods. Relying also on the purpose of the unemployment compensation statute to minimize the hardships encountered by workers who lose their job through no fault of their own, Gardner contends that he should have received benefits for the forty-day period after he was terminated as the District unreasonably withheld his severance payment during this time.

Gardner's arguments are unavailing because nothing in the language of D.C. Code § 46-108 (e) suggests that the reduction of weekly benefit payments by the amount of the severance payment *fn7 is contingent on the receipt of the severance pay in the specific benefit week. The statute expressly states that the weekly benefit amount is to be reduced by earnings "payable" to the claimant "with respect to" a specific benefit week. Thus, under § 46-108 (e), a claimant's weekly benefit payment must be reduced by any earnings that are "requir[ed] to be paid" to the claimant for that week, irrespective of whether the claimant actually receives the earnings during the relevant week or whether the claimant receives the payment in installments or in a lump-sum. See Webster's Third New International Dictionary 1659 (1986) (defining the word "payable" as "requiring to be paid"). Gardner indicated in his June 13, 1997 application for unemployment benefits that he was due to receive severance pay equivalent to $929 per week for the period between May 30, 1997 and June 28, 1997, and his own signed statement in the agency's July 28, 1997 fact-finding report said that "[t]he severance pay was for a four week period starting with the May 30, 1997 termination date" (emphasis added).

Our reading of the plain meaning of the statutory language finds support in the case law of other jurisdictions. In Busch v. Reserve Mining Co., 415 N.W.2d 892 (Minn. Ct. App. 1987), the Minnesota Court of Appeals held that the employer's agreement with the employee's union which obligated the employer to make a special pension payment "for the first three full calendar months following the month in which retirement occurs" was specific enough to allow allocation of the lump-sum payment for the purposes of offsetting the employee's receipt of weekly unemployment compensation benefits. Id. at 894; see also Fazio v. Unemployment Compensation Bd. of Review, 63 A.2d 489, 491 (Pa. Super. Ct. 1949) ("a voluntary dismissal payment is 'remuneration,' and the employee who receives it does not become unemployed until the end of the period for which it was paid"), superseded by statute as stated in Hock v. Commonwealth Unemployment Bd. of Review, 413 A.2d 444 (Pa. Commw. Ct. 1980). *fn8 In so ruling, the Busch court distinguished a prior decision by the Supreme Court of Minnesota which had held that the severance payment could be used to offset the employee's unemployment compensation benefits for only the week in which the payment was actually received. See Ackerson v. Western Union Tel. Co., 48 N.W.2d 338 (Minn. 1951); see also Busch, supra, 415 N.W.2d at 895. The Ackerson court had noted that severance pay usually is "in no way related to or dependent upon the employee's employment status after separation" so that even if the employee obtained a new position the day after termination, she would still be entitled to retain both her severance pay as well as wages earned at her new position. See Ackerson, supra, 48 N.W.2d at 342. However, the Ackerson court left open the possibility that if the employer had contracted with its employee to have the severance payment paid in weekly installments over a period of time, which was the situation later presented in Busch, this arrangement might prevent the employee from becoming eligible for unemployment compensation benefits. See id.; cf. id. at 341 ("the payments were not designated as wages for a specific future period of time, as was done in the Fazio case"). See also Fazio, supra, 63 A.2d at 491 (receipt of severance check with notation "salary for February and March" barred employee from eligibility for unemployment benefits until end of period for which payment was made). *fn9

Here, even though Gardner's termination letter from the District of Columbia did not expressly designate his severance pay for a particular period, Gardner represented to DOES, both in his initial benefits application as well as in the July 28, 1997 fact-finding report, that the severance payment was intended as remuneration for the four-week period immediately following the date of his termination. *fn10 Under those circumstances, it was reasonable for the agency, pursuant to D.C. Code § 46-108 (e), to prorate Gardner's severance payment over the relevant period and correspondingly reduce Gardner's weekly unemployment compensation benefits. Therefore, as Gardner's weekly earnings, in the form of prorated severance pay, exceeded the maximum amount of unemployment compensation benefits he was eligible to receive, *fn11 the claims examiner's determination that Gardner was not entitled to collect unemployment compensation benefits during the period covered by the severance payment was supported by the evidence of record. *fn12


Gardner also challenges the denial of a hearing on the merits of his benefits claim before the appeals examiner, noting that the Notice of Hearing stated that postponement of the hearing would be granted for cause. He asserts that because he had sufficient cause for his absence from the September 16, 1997 appeals hearing, to attend a job interview, the agency was required to either postpone the hearing, or else hold another appeals hearing. Because the agency afforded him neither option, Gardner argues he was denied due process of law. We disagree.

Title 7 of the DCMR, § 307.4 (1986), states that a claim may be reopened upon request by the party who failed to appear for the hearing if the party gives written notice to the Director within ten calendar days after the date of the hearing that the reason for his or her absence constitutes good cause, as determined by 7 DCMR § 316.4. See id. *fn13 One of the reasons considered to be "good cause" is "[s]eeking work where there is a reasonable indication that work is available." 7 DCMR § 316.4 (c). Because a job interview certainly would qualify under this provision, if a claimant has properly presented the issue to the agency, he or she would have good cause for the absence and would not waive his or her right to present testimony. Cf. McCaskill v. District of Columbia Dep't of Employment Servs., 572 A.2d 443, 446 (D.C. 1990) (failure to appear at hearing without good cause waives right to present testimony), opinion amended on other grounds, 1990 D.C. App. LEXIS 128 (1990).

However, on this record, it does not appear that Gardner ever brought the fact that he had an interview on the scheduled hearing date to the appeals examiner's attention. In Gardner's letter requesting reconsideration of the appeals examiner's decision, Gardner did not mention anything about a job interview, stating only that he had thought that the hearing had been scheduled for September 19, rather than the 16th. Nor did Gardner proffer this reason in his objections to the proposed final decision; instead, he stated only that he had "reasonable cause" to request a new hearing date, and that the OAR had not addressed his request for rehearing. *fn14 In its final decision, the OAR determined that Gardner had not provided good cause for his failure to appear, attributing Gardner's absence to Gardner's own misconception of the hearing date. In view of the fact that Gardner gave no reason for his absence other than his own mistake, the OAR did not err in affirming the appeals examiner's decision without granting Gardner an opportunity to present additional evidence. See McCaskill, supra, 572 A.2d at 446 (failure to appear at hearing waives claimant's right to present testimony). *fn15

Accordingly, the decision of DOES hereby is


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