Court Opinion

ID: 2800499
Source: CourtListenerOpinion
Date Created: 2015-05-13 19:20:40.358128+00
Date Added: 2024-06-11T11:31:49.797507
License: Public Domain

IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA

                               January 2015 Term
                                                                FILED

                                                              May 13, 2015

                                  No. 14-0315                 released at 3:00 p.m.
                                                              RORY L. PERRY II, CLERK
                                                            SUPREME COURT OF APPEALS
                                                                OF WEST VIRGINIA
                               LARRY MYERS,

                          Petitioner Below, Petitioner

                                       v.

                      OUTDOOR EXPRESS, INC., and

                      WORKFORCE WEST VIRGINIA,

                      Respondents Below, Respondents

               Appeal from the Circuit Court of Kanawha County

                    The Honorable Paul Zakaib, Jr., Judge

                          Civil Action No. 13-AA-71

       AFFIRMED, IN PART, REVERSED, IN PART, AND REMANDED

                           Submitted: April 22, 2015

                             Filed: May 13, 2015

Steven Brett Offutt, Esq.               Mary Blaine McLaughlin, Esq.
Law Office of Brett Offutt              WorkForce West Virginia / Legal Section
Harpers Ferry, West Virginia            Charleston, West Virginia
Counsel for the Petitioner              Counsel for Respondent
                                        WorkForce West Virginia

                                            Brian M. Peterson, Esq.
                                            Bowles Rice LLP
                                            Martinsburg, West Virginia
                                            Counsel for Respondent
                                            Outdoor Express, Inc.

JUSTICE KETCHUM delivered the Opinion of the Court.
                             SYLLABUS BY THE COURT

       1. “The findings of fact of the Board of Review of the West Virginia Department of

Employment Security are entitled to substantial deference unless a reviewing court believes

the findings are clearly wrong. If the question on review is one purely of law, no deference

is given and the standard of judicial review by the court is de novo.” Syl. pt. 3, Adkins v.

Gatson, 192 W.Va. 561, 453 S.E.2d 395 (1994).

       2. This State’s statutory eligibility and disqualification provisions concerning the

receipt of unemployment compensation benefits constitute a two-step process. The first step

requires determining whether the claimant is eligible to receive benefits. The second step

requires determining whether the claimant is disqualified from receiving benefits.

       3. “‘Generally the words of a statute are to be given their ordinary and familiar

significance and meaning, and regard is to be had for their general and proper use.’ Syl. pt.

4, State v. General Daniel Morgan Post No. 548, VFW, 144 W.Va. 137, 107 S.E.2d 353

(1959).” Syl. pt. 3, State ex rel. Smith v. W.Va. Crime Victims Compensation Fund, 232

W.Va. 728, 753 S.E.2d 886 (2013).
Justice Ketchum:

       The petitioner, Larry Myers (“Myers”), appeals from the February 25, 2014, order of

the Circuit Court of Kanawha County affirming the administrative decision of the

respondent, Workforce West Virginia (“Workforce”), that Myers was ineligible to receive

unemployment compensation benefits for various periods between November 29, 2008, and

March 17, 2012.1 The circuit court directed that Myers pay back $39,713.00 in benefits he

received from Workforce for those periods.

       Upon review, this Court affirms the conclusion that Myers was ineligible to receive

unemployment compensation benefits. Myers was ineligible for benefits because he was

neither totally nor partially unemployed during the periods in question. However, we further

conclude that the $39,713.00 was improperly calculated, as Myers contends, based on the

statute of limitations pertaining to the overpayments in this case. Consequently, this Court

reverses that aspect of the case and remands this matter to the circuit court for a

determination of the amount of Myers’s repayment, consistent with this Opinion.

       1
        Workforce, which includes the Division of Unemployment Compensation, is part
of the West Virginia Department of Commerce. See W.Va. Code, 5F-2-1(b)(7) [2011].

                                             1

                                            I.

                                   Factual Background

       Outdoor Express, Inc. (“Outdoor Express”), a recreational vehicle dealership, sold and

provided service for travel trailers and truck campers. Myers, a sales associate, worked at

Outdoor Express’s location in Falling Waters, West Virginia. Sales of such vehicles

normally occurred on a seasonal basis, with higher sales in the summer and warmer months

and significantly fewer sales during the winter and colder months.

       Myers was paid bi-weekly on a commission basis (3% to 4% of the sales price), but

only when his sales were finalized by Outdoor Express during the preceding two-week

period. Myers received no pay if no sales were finalized during such period. Due to the

seasonal nature of the business and downturns in the economy, sales associates like Myers

would occasionally go for weeks without a sale and, thus, without income.

       With advice from the local unemployment office in Martinsburg, West Virginia,

which was subsequently questioned by Workforce, Outdoor Express issued Low Earnings

Reports (“LERs”) to Myers for periods when Myers did not receive commission checks for

sales of recreational vehicles.2 Myers filed claims for, and received, unemployment

      2
       Pursuant to this State’s unemployment compensation regulations, W.Va. C.S.R.,
21A-2-11.01 (1991), Employer’s Report of Low Earnings:

              In any week in which an employee is partially unemployed, each

                                             2

compensation benefits for those periods. He did not file claims for periods when he received

commission checks.

       This case specifically involves twenty-two separate claims for unemployment

compensation benefits filed by Myers, and benefits paid, over the period November 29, 2008,

to March 17, 2012.3

                                          II.

                                Procedural Background

                          A. The Administrative Proceedings

       On November 13, 2012, and November 16, 2012, the deputy commissioner issued

decisions on each of the twenty-two claims. In each claim, the deputy found that Myers was

neither totally nor partially unemployed during the periods in question and was, therefore,

ineligible for unemployment compensation benefits.          The deputy determined that

overpayments of benefits had been made in the claims and that the benefits were to be repaid

by Myers.

       employing unit is required to deliver to such employee on or before the
       payday for the week in which the low earnings occurred . . . a report of
       low earnings on a prescribed form furnished by the West Virginia Division
       of Employment Security.
       3
         According to Myers, for periods in which he did not receive a commission
check, he filed claims and was paid unemployment compensation benefits between
$339.00 and $424.00 per week.

                                             3

       Myers appealed the deputy’s decisions, and a hearing was conducted before the

administrative law judge. On February 28, 2013, the administrative law judge affirmed the

decisions of the deputy in the twenty-two claims on the basis that Myers was neither totally

nor partially unemployed during the periods in question. Among the administrative law

judge’s findings of fact were the following:

               1. The claimant is not entitled to a “draw” upon anticipating
       commissions.
               2. For all relevant time periods, the employer reported the claimant
       worked forty hours per week for the employer, and paid no compensation.
               3. The claimant’s sales commissions are and have been adversely
       affected by both the seasonal nature of sales, and the recent extended downturn
       in the economy.
               4. For all relevant time periods for which LERs were issued by the
       employer to the claimant, said claimant was performing some services for the
       company for which the claimant was eventually compensated by commissions.
               5. Between the third quarter of 2009, and the third quarter of 2012, the
       claimant was paid approximately $164,000 in commissions by the employer.
               6. During said time period, the employer reported all compensation paid
       to the claimant on a quarterly basis to the Unemployment Compensation
       Office.
               7. During said time period, the claimant reported no compensation in
       the form of commissions received to Unemployment Compensation on his
       continued claim forms.

       Affirming Myers’s ineligibility to receive benefits, the administrative law judge

provided the following analysis:

                                               4

               Whereas seasonal workers in construction or landscaping would
       normally be laid off at the end of the season, or issued LERs when work was
       scarce, the commission-based employee in this case, Mr. Myers, being a
       recreational vehicle salesman, was handled differently. Apparently with the
       misunderstood blessing of the local office, the employer began issuing LERs
       to the claimant for any slow time during which the claimant did not “earn”
       (actually physically receive) a commission, even though perhaps a day or two
       later the claimant would receive a commission check. The employer believed
       this was a “program” to help companies and employees through lean sales
       periods without the need to be in conformance with the requirements of the
       statute regarding total and partial unemployment.

              However, one of the striking facts here is that over the relevant time
       period (late 2008 to late 2012), the claimant was paid more than $164,000 of
       commissions[.] * * * Bottom line, the claimant was not totally or partially
       unemployed for any period for which he received Low Earnings Reports by
       this employer, and, therefore, is ineligible for such periods. During all relevant
       time periods the claimant was performing services for this employer, and,
       therefore, does not meet the requirement of being totally or partially
       unemployed.

             No fraud was intended here, and none is being alleged by the
       Department.

       The administrative law judge’s findings and conclusions concerning the twenty-two

claims were summarily affirmed by the Board of Review on May 15, 2013. Myers appealed

the Board’s decision to the circuit court.

                               B. The Circuit Court Appeal

       On February 25, 2014, the circuit court entered an order affirming the decision of the

Board of Review. The circuit court concluded that Myers was neither totally nor partially

                                               5

unemployed during the periods in question. Focusing on the issue of partial unemployment,

the circuit court stated:

                 [Myers’s] case was discovered in a cross-match audit comparing the
          inconsistencies between what the employer reported as the compensation
          received by [Myers] as well as the fact that [Myers] worked forty (40) hours
          a week, and the failure of [Myers] to report any compensation on his claim
          form. * * *

                  [Myers] is ineligible for unemployment compensation benefits due to
          the fact that he worked forty (40) hours a week, and, therefore, [was] not
          partially unemployed.

          The circuit court determined that the overpayments of benefits to be repaid by Myers

totaled $39,713.00. Myers’s appeal to this Court followed.

                                             III.

                                      Standards of Review

          This Court’s standards of review for unemployment compensation cases are

axiomatic. Syllabus point 3 of Adkins v. Gatson, 192 W.Va. 561, 453 S.E.2d 395 (1994),

states:

                 The findings of fact of the Board of Review of the West Virginia
          Department of Employment Security are entitled to substantial deference
          unless a reviewing court believes the findings are clearly wrong. If the
          question on review is one purely of law, no deference is given and the standard
          of judicial review by the court is de novo.

                                                6

Accord syl. pt. 1, Childress v. Muzzle, 222 W.Va. 129, 663 S.E.2d 583 (2008); syl. pt. 1,

Kisamore v. Rutledge, 166 W.Va. 675, 276 S.E.2d 821 (1981). See W.Va. Code, 21A-7-21

[1943] (The Board’s findings of fact “shall have like weight to that accorded to the findings

of fact of a trial chancellor or judge in equity procedure.”).

       Moreover, we note that this State’s statutory eligibility and disqualification provisions

concerning the receipt of unemployment compensation benefits constitute a two-step process.

The first step requires determining whether the claimant is eligible to receive benefits. The

second step requires determining whether the claimant is disqualified from receiving

benefits. Univ. of W.Va. Bd. of Trustees v. Aglinsky, 206 W.Va. 180, 182, 522 S.E.2d 909,

911 (1999); Private Indus. Council of Kanawha Co. v. Gatson, 199 W.Va. 204, 207, 483
S.E.2d 550, 553 (1997).

       In this case, no disqualification issues have been raised. Consequently, our review

concerns Myers’s eligibility for unemployment compensation benefits and the question of

overpayments.

                                            IV.

                                         Discussion

       Eligibility for unemployment compensation in West Virginia is largely statutory.

Under W.Va. Code, 21A-6-1(4) [2009], a claimant shall be eligible to receive benefits only

                                               7

if he or she “has been totally or partially unemployed during his or her benefit year for a

waiting period of one week prior to the week for which he or she claims benefits for total or

partial unemployment.” Total and partial unemployment are defined in W.Va. Code, 21A­

1A-27 [1996], as follows:

              (1) An individual is totally unemployed in any week in which such
       individual is separated from employment for an employing unit and during
       which he or she performs no services and with respect to which no wages are
       payable to him or her.

               (2) An individual who has not been separated from employment is
       partially unemployed in any week in which due to lack of full-time work
       wages payable to him or her are less than his or her weekly benefit amount
       plus sixty dollars: Provided, That said individual must have earnings of at least
       sixty-one dollars.

       The definition of total and partial unemployment, thus expressed, is further refined

in W.Va. Code, 21A-1A-24 [1996], which states that “separated from employment” means

“the total severance, whether by quitting, discharge or otherwise, of the employer-employee

relationship,” and in W.Va. Code, 21A-1A-28(a) [2009], which states that “wages” means

all remuneration for personal service, “including commissions.” (Emphasis added) Finally,

under W.Va. Code, 21A-1A-30 [1996], the phrase “weekly benefit rate” is defined as “the

maximum amount of benefit an eligible individual will receive for one week of total

unemployment.”4

       4
       An additional statute, W.Va. Code, 21A-1A-16(1) [1997], states that
“employment” means service “performed for wages or under any contract of hire, written

                                              8

       In this case, it is undisputed that Myers did not qualify for unemployment

compensation benefits under the total unemployment portion of W.Va. Code, 21A-1A-27

[1996]. He was never separated from his employment with Outdoor Express by quitting,

discharge or otherwise, between November 2008 and March 2012. As the administrative law

judge found, for the periods for which LERs were issued, Myers was performing some

services for the company. As Myers states, he was “meeting his obligation to do whatever

was reasonable and necessary to remain employed.” Therefore, the issue is whether Myers

was eligible to receive benefits under the partial unemployment portion of W.Va. Code, 21A­

1A-27 [1996].

       While the statutory provisions in this State concerning unemployment compensation

are relatively straightforward, this Court is of the opinion that, from a factual standpoint,

contested claims for benefits must ordinarily be resolved on a case-by-case basis. The

extensive indices in the annotations on the subject attest to that conclusion.5

or oral, express or implied.” In that regard, although Myers was paid on a commission
basis and could not draw upon anticipated income from sales, nothing in this case
suggests that he was an independent contractor engaged in his own business enterprise.
As an employee of Outdoor Express, Myers was, therefore, under the protection of this
State’s unemployment compensation laws, but only eligible to receive benefits if he was
totally or partially unemployed. See J. T. W., Annotation, Who is an Independent
Contractor rather than an Employee within Social Security Acts or Unemployment
Compensation Acts, 124 A.L.R. 682 (1940); 76 Am. Jur. 2d Unemployment
Compensation § 49 (2005).
       5
        See, e. g., J. C. Williams, Annotation, Part-Time or Intermittent Workers as
Covered by or as Eligible for Benefits Under State Unemployment Compensation Act, 95

                                              9

       In Tom’s Convenient Food Mart v. W.Va. Human Rights Comm’n., 206 W.Va. 611,

613, 527 S.E.2d 155, 157 (1999), this Court noted that, because river rafting is a seasonal

industry, employees “are eligible for ‘low earnings’ unemployment compensation in the off­

season.” That case, however, concerned a claim of age discrimination litigated before the

West Virginia Human Rights Commission, rather than a question of eligibility to receive

unemployment benefits.

       With regard to seasonal industries, W.Va. Code, 21A-6-1a [1963], states:

              An individual working less than one hundred days during his base
       period in an industry recognized as seasonal, such as food processing and
       canning, shall not be eligible for benefits unless he has earned wages during
       his base period in other covered employment equal to not less than one
       hundred dollars.

       As stated in State by Davis v. C. H. Musselman Co., 134 W.Va. 209, 217, 59 S.E.2d
472, 476 (1950), that provision was designed to relieve seasonal employers, in such

industries as food processing and canning, from the unfair requirement of being charged with

the payment of benefits on a regular basis, from year to year, as the unemployment of its

seasonal employees ensues.

A.L.R.3d 891 (1979), and L. S. Tellier, Annotation, Salesman on Commission as Within
Unemployment Compensation or Social Security Acts, 29 A.L.R. 2d 751 (1953).

                                            10

       W.Va. Code, 21A-6-1a [1963], is not dispositive in the present case. Although

Myers’s sales of recreational vehicles were seasonal in the sense that there were fewer sales

during the winter and colder months, his employment relationship with Outdoor Express was

not seasonal within the meaning of the statute. Outdoor Express did not reduce Myers’s

hours during the periods in question, and, during those downtimes, Myers worked

approximately forty hours per week. Moreover, during the downtimes, the possibility of a

sale was always present.

       Due to his employment relationship with Outdoor Express, Myers’s assertion of

eligibility for unemployment compensation benefits based on seasonal employment is

without merit. See Homer Laughlin China Co. v. Hix, 128 W.Va. 613, 625, 37 S.E.2d 649,

655-56 (1946) (The primary purpose of unemployment compensation law is to promote

social and economic security and “not to regulate or control the relationship of employer and

employee.”).

       With regard to Myers’s wages in the form of commissions, the administrative law

judge found that Myers was paid approximately $164,000 over the years from 2009 to 2012.6

       6
        During the hearing before the administrative law judge, Outdoor Express’s
representative, Frank Subasic, explained:

            Q. But there were times at least during the summer when a
       commission - when a specific period was not earned by Mr. Myers that you

                                             11

Myers, however, correlates “services” with wages “payable” and contends that he met the

eligibility requirement for unemployment compensation benefits because, during the periods

for which he filed a claim, he did not sell a recreational vehicle. Myers, therefore, asserts

that, for those periods, he did not perform a service for which wages were payable even

though he was present on the premises of Outdoor Express. Nevertheless, according to the

findings of the administrative law judge, while Outdoor Express reported Myers’s income

to the unemployment office on a quarterly basis, Myers never reported his income on the

unemployment office’s claim forms. Consequently, Workforce is warranted in suggesting

that Myers’s commissions, while paid on occasion, were garnered or “payable” for services

over preceding weeks. According to Workforce, Myers should have reported all income

earned, even if he had not received payment.

       We have consistently held that this State’s unemployment compensation statutes

should be liberally construed in favor of the claimant, but not when such a construction

would conflict with plain and unambiguous statutory language. Adkins v. Gatson, supra, 192

W.Va. at 564-65, 453 S.E.2d at 398-99; Davenport v. Gatson, 192 W.Va. 117, 119, 451

       were giving him a low earnings report and he was collecting unemployment
       benefits and maybe a week later he would get a fairly large commission
       after selling a couple of vehicles?

               A. That’s possible that happened yes. But I don’t - without referring
       to all the documents - that’s possible that could happen, yes.

                                             12
S.E.2d 57, 59 (1994). Moreover, in syllabus point 3 of State ex rel. Smith v. W.Va. Crime

Victims Compensation Fund, 232 W.Va. 728, 753 S.E.2d 886 (2013), we confirmed the

following principle:

              “Generally the words of a statute are to be given their ordinary and
       familiar significance and meaning, and regard is to be had for their general and
       proper use.” Syl. pt. 4, State v. General Daniel Morgan Post No. 548, VFW,
       144 W.Va. 137, 107 S.E.2d 353 (1959).

       Here, the definitions of total and partial unemployment set forth in W.Va. Code, 21A­

1A-27 [1996], refer to whether a claimant for unemployment compensation benefits has

obtained wages “payable” to him or her, rather than whether the claimant has, in fact, been

paid. See Short v. Wells Fargo Bank Minn., 401 F. Supp. 2d 549, 563 (S.D. W.Va. 2005)

(associating the term “payable” with “legally enforceable” or “obligation to pay”). See also

Appeal of Stewart (N.H. Dept. of Employment Security), 64 A.3d 989, 993 (N.H. 2013)

(“Paid” means receiving pay or marked by the reception of pay; “payable” means capable of

being paid or requiring to be paid.); General Motors Corp. v. Buckner, 49 S.W.3d 753, 757

(Mo. Ct. App. 2001) (“The term ‘payable,’ as used in the context of wages to determine

eligibility for unemployment compensation benefits, requires some legal obligation on the

part of the employer to compensate employees.”).7

       7
           We recognize that in W.Va. C.S.R., 21A-2-7.01 (1991), Definitions:

            Contributions and wages shall be reported on a wages paid basis.
       Wages paid shall be deemed to consist of wages actually or constructively

                                             13

       Consequently, because Myers did not report any commissions earned or payable in

conjunction with his claims for benefits for the periods between November 29, 2008, to

March 17, 2012, he was not eligible to receive unemployment compensation benefits.

       Finally, Myers contends that the circuit court committed error in directing that he pay

Workforce the entire $39,713.00 in overpayments. Myers states that the amount should be

recalculated based on the two-year statute of limitations set forth in W.Va. Code, 21A-10-21

[1989]. That statute, addressing the recovery of benefits paid through error, provides:

              A person who, by reason of error, irrespective of the nature of said
       error, has received a sum as a benefit under this chapter, shall either have such
       sum deducted from a future benefit payable to him or shall repay to the
       commissioner the amount which he has received. Collection shall be made in
       the same manner as collection of past due payment. Provided, That such
       collection or deduction of benefits shall be barred after the expiration of two
       years.

       paid. Wages are constructively paid when they are credited to the account
       of or set apart for an employee so that they may be drawn upon by him at
       any time although not then actually reduced to possession, or whenever they
       are due an employee and are not actually paid because of employer’s refusal
       or inability to pay.

       However, under W.Va. C.S.R., 21A-2-11.01 (1991), Employer’s Report of Low
Earnings, the information required to establish partial unemployment includes “the
earnings during the week.” That regulation is derivative of the definition of “partial
unemployment” set forth in W.Va. Code, 21A-1A-27 [1996], and its statutory
predecessors, which is grounded on wages “payable” to the claimant. See Appeal of
Stewart (N.H. Dept. of Employment Security), supra, 64 A.3d at 993 (“Earn” means to
come to be duly worthy of, or entitled to, as remuneration for work or services.).

                                              14

(Emphasis added)

       Workforce asserts, however, that, if any adjustment in the overpayment of benefits is

to be made, the applicable statute is W.Va. Code, 21A-10-8 [1990]. That statute, addressing

transgressions such as misrepresentation or fraud by a claimant, provides a five and a ten-

year statute of limitations.

       This case involves neither misrepresentation nor fraud. Outdoor Express issued LERs

to Myers, on the advice of the local unemployment office in Martinsburg for periods when

Myers did not receive commission checks. That advice was subsequently questioned by

Workforce. Although Myers failed to report his income on the claim forms, the principal

error rests with the local office and continued for several years while Myers was receiving

unemployment compensation benefits. As the administrative law judge stated, “It is

incumbent upon the Department to provide more clear and precise instructions to employers

and employees that are affected by seasonal activities and who operate on a commission

basis.” Accordingly, this Court is of the opinion that the applicable statute is W.Va. Code,

21A-10-21 [1989], which sets forth the two-year limit.8

       8
      See generally J. C. Williams, Annotation, Repayment of Unemployment
Compensation Benefits Erroneously Paid, 90 A.L.R. 3d 987 (1979).

                                            15

                                          V.

                                       Conclusion

      This Court affirms the circuit court’s conclusion that Myers was ineligible to receive

unemployment compensation benefits. He was neither totally nor partially unemployed

during the periods in question. However, the $39,713.00 overpayment was improperly

calculated and should be recalculated pursuant to W.Va. Code, 21A-10-21 [1989].

Consequently, this Court reverses that aspect of the case and remands this matter to the

circuit court for a determination of the amount of Myers’s repayment, i.e., Workforce is

barred from collecting benefits paid to Myers prior to two years before the dates of the

deputy’s decisions on November 13, 2012, and November 16, 2012.

                                  Affirmed, in part, Reversed, in part, and Remanded.

                                            16