Court Opinion

ID: 9518585
Source: CourtListenerOpinion
Date Created: 2023-08-07 00:56:43.484411+00
Date Added: 2024-06-11T12:27:31.493397
License: Public Domain

JUSTICE GORMAN, dissenting: I respectfully dissent. In order for an employee to be guilty of misconduct within the meaning of section 602(A) of the Unemployment Insurance Act (Ill. Rev. Stat. 1987, ch. 48, par. 432(A)), there must be a rule or policy of the employing unit which the employee has violated (see Ill. Rev. Stat. 1987, ch. 48, par. 432(A)). However, the rule or policy involved does not necessarily have to be written or otherwise formalized. Standards of behavior which an employer has a right to expect constitute reasonable rules and policies. (See Bandemer v. Department of Employment Security (1990), 204 Ill. App. 3d 192, 195, 562 N.E.2d 6, 7.) A bank has a right to expect that its officers and employees who discover a significant misapplication of bank funds will promptly bring that to the attention of management. That legitimate expectation constitutes a reasonable rule or policy within the meaning of those terms in section 602(A). A finding of misconduct requires a finding of a deliberate and willful violation of a reasonable rule or policy of the employer (Ill. Rev. Stat. 1987, ch. 48, par. 432(A)). The Board essentially argues that since the bank had a long-standing practice of allowing the use of drawer five to hold checks of officers and employees until funds could be deposited to cover the checks, and since the bank had no formal rules or policies regarding this practice, the claimant had no notice that the offending employee’s conduct constituted a misapplication of bank funds. Without such notice, the argument goes, the claimant could not have deliberately and willfully violated the unexceptionable, though unstated, rule or policy requiring prompt reporting of misapplications of bank funds. This argument would have considerable merit if the checks had been in drawer five for only a few days when the claimant discovered them. However, that was not the case. The claimant's testimony makes it clear that when she discovered the checks at issue on March 15, 1988, she immediately realized that this was a situation unlike the situation where an officer or employee had a check in drawer five overnight or for a few days. If inspection of the checks at that time did not reveal to the claimant that they had been in drawer five for approximately two weeks, then her discussion on that date with the other long-time employee revealed that fact to her. Her persistence in pursuing the matter until it was resolved shows concern for the bank’s interests, but it also shows her awareness that the matter was beyond the scope of the long-standing practice of allowing officers and employees to keep checks in drawer five for at most a few days and that it constituted a serious problem. While the claimant’s motive for acting as she did seems to have been to protect the bank’s interests without unnecessarily exposing a fellow employee to some potentially serious sanctions, a good motive such as this will not insulate the claimant from being found to have engaged in misconduct as defined by section 602(A). The claimant had no right to give the offending employee additional time to rectify the problem at the bank’s peril, which is essentially what the claimant did. The evidence is clear that the claimant realized that a misapplication of funds had occurred, deliberately and willfully delayed almost a week in reporting the problem to management, and in so doing violated the reasonable rule or policy that misapplications of bank funds be reported to management promptly after their discovery. The Board argues that since the bank had already paid out funds on the checks in drawer five before the claimant discovered them, the bank was not harmed by the delay of six days between the time the claimant discovered the checks and the time the matter was brought to the attention of management. This view of harm is too limited. It ignores the harm of almost a week’s exposure by the bank to further losses from further checks that might have been put through the system and into drawer five by the employee whose checks were already in drawer five. A deliberate and willful violation of a reasonable rule or policy, where the violation will result in a substantially increased risk of loss by the employer, is precisely the kind of behavior which merits a denial of unemployment benefits. The record shows that the bank was harmed by the violation of a reasonable rule or policy. The soundness of financial institutions is of great public concern. It is critical that misapplications of funds from such institutions be detected and reported promptly to prevent further misapplications and to allow recovery of funds already misapplied. In my view, to hold that a bank officer could delay almost a week in reporting what she had to know was a misapplication of bank funds and only be guilty of an error in judgment contravenes public policy. To hold otherwise permits awarding of unemployment benefits where the statute and public policy dictate that such benefits should not be awarded. I believe this court should reverse the decision of the circuit court. Accordingly, I dissent.