Newspaper Agency Corp. v. Dept. of Workforce Services, et al
Annotate this Casepublication in the Pacific Reporter.
IN THE UTAH COURT OF APPEALS
----ooOoo----
Newspaper Agency Corporation,
Petitioner,
v.
Department of Workforce Services
and Teresa Ortiz,
Respondents.
OPINION
(For Official Publication)
Case No. 981369-CA
F I L E D
July 9, 1999
1999 UT App 222
-----
Original Proceeding in this Court
Attorneys:
Sharon E. Sonnenreich and
Deno G. Himonas, Salt Lake City, for Petitioner
Lorin R. Blauer, Salt Lake
City, for Respondents
-----
Before Judges Greenwood, Bench, and Orme.
ORME, Judge:
¶1
Petitioner Newspaper Agency
Corporation (NAC) seeks review of the Workforce Appeals Board's decision
that claimant Teresa Ortiz was entitled to unemployment benefits and that
NAC should be assessed its share of benefit costs. Because the Board correctly
interpreted the law in concluding claimant's appeal was timely filed and
NAC has failed to persuade us that relief from its share of benefit costs
is warranted, or even possible, we decline to set aside the Board's decision.
BACKGROUND
¶2
Because the parties dispute
only the effect of the factual findings, and not the findings themselves,
"we recite the facts in accord with those findings." Maverik Country
Stores v. Industrial Comm'n, 860 P.2d 944, 945 n.2 (Utah Ct. App. 1993).
NAC discharged claimant, an NAC driver, on October 2, 1997. On October
17, claimant filed a claim with the Utah Department of Workforce Services
for unemployment compensation. The Department denied her benefits, concluding
that claimant was "discharged from [her] job for not following a reasonable
policy, rule or instruction from [her] employer" and that the discharge
was for "just cause." The Department sent notice of its decision to claimant
on November 4, 1997, including an explanation of claimant's right to appeal:
RIGHT TO APPEAL
-- If you believe this decision is incorrect, appeal by mail to: Appeals
Section; P.O. Box 45244; Salt lake City, Ut. 84145-0244, or by FAX (801)536-7649.
You must appeal in writing within 10 calendar days after this decision
was mailed. YOUR APPEAL MUST BE SIGNED BY YOU AND SHOW THE DATE MAILED
OR SENT BY FAX AND YOUR NAME AND SOCIAL SECURITY NUMBER. STATE THE GROUNDS
FOR YOUR APPEAL AND THE RELIEF YOU ARE REQUESTING.
¶3
Although she wished to dispute
the Department's determination and understood the basic procedure for doing
so, claimant failed to follow this description of how and when to appeal.
That is, rather than mailing or faxing her appeal letter as instructed
in her notice of the Department's decision, around November 9 or 10, claimant
brought it with her to an employment center operated by the Department,
in conjunction with a visit to inquire about and apply for new employment.
Claimant asserted that she gave her letter of appeal to an employee named
Sandy, who agreed to forward it to the Appeals Section, and that she thereby
substantially complied with the procedural requirements for appealing the
Department's decision. However, the Administrative Law Judge's diligent
search of documents and microfilm failed to uncover the letter.
¶4
Having received no response
to her first appeal letter and after being advised by a Department employee
that no appeal had been received, claimant wrote a second letter of appeal.
On December 9, she again personally delivered her second letter to another
Department office. According to claimant, a Department employee named Elaine
accepted the second letter and stated she would make sure it was forwarded
to the Appeals Section. Despite the ALJ's diligent search, however, as
with claimant's first appeal, no record of this second appeal letter was
discovered.
¶5
Finally, on January 9, 1998,
after calling the Department and being informed no appeal had yet been
filed, claimant delivered a third letter of appeal, this time directly
to the Appeals Section. On January 14, the Department mailed a notice of
formal adjudicative proceedings to claimant and NAC, followed by a notice
of hearing. The record contains no indication that NAC was previously advised
of claimant's intention to appeal. On February 2, a hearing was held regarding
the timeliness and merits of claimant's appeal, after which the ALJ issued
a decision concluding that because claimant filed her appeal sixty-six
days after the Department's initial decision was mailed, it was not timely.
The ALJ further concluded that because the appeal was untimely, the ALJ
had no jurisdiction to review the merits of the Department's determination
that claimant was discharged for good cause. Claimant appealed this decision
to the Workforce Appeals Board.
¶6
On review, the Board concluded
that claimant's appeal was timely filed because "claimant credibly testified
that within a few days of receiving the decision, she went to the Redwood
Road office of the Department of Workforce Services [and] delivered her
appeal to a woman in the unemployment office on the second floor." The
Board noted that although filing an appeal via mail or fax was preferred,
Utah Administrative Code R994-406-309 allowed filing at an employment center.
Consequently, the Board remanded the matter to the ALJ for a decision on
the merits.
¶7
On remand, the ALJ ruled
that NAC did not discharge claimant for just cause. Therefore, the ALJ
reversed the Department's initial administrative determination denying
claimant unemployment benefits and ruled that NAC was liable for its pro-rated
share of benefit costs. NAC appealed this decision to the Board, asking
the Board to reconsider and reverse its earlier decision that claimant's
appeal was timely.(1) NAC argued that even
accepting the Board's factual findings, the "decision was incorrect as
a matter of law." NAC contended that the Board erroneously applied an outdated
version of the administrative rule and that both the earlier and amended
versions were invalid because they were impermissibly inconsistent with
Utah Code Ann. § 35A-4-406(3)(a) (1997). The Board disagreed, concluding
the amendment did not substantively change the administrative rule and
that the rule did not conflict with section 35A-4-406(3)(a). The Board
affirmed the ALJ'S decision, and NAC then sought this court's review.
ISSUES AND STANDARDS OF REVIEW
¶8
NAC does not dispute the
Board's factual finding that claimant delivered a letter of appeal to an
unemployment office within ten days after the Department mailed notice
of its decision. NAC challenges only the Board's legal conclusion that,
under Utah Administrative Code R994-406-309, the appeal was timely. First,
NAC argues that by authorizing filing in such a manner, the rule expands
the Appeals Section's jurisdiction beyond that authorized by statute and
is therefore invalid. Our determination of this issue turns on an interpretation
of section 35A-4-406(3)(a) of the Utah Code.
¶9
Second, NAC argues that
if the Department has the power to designate agents for receipt of appeals
and claimant's first appeal was thus timely filed, the agents' failure
to properly keep or forward claimant's letters of appeal should prevent
the Department from assessing NAC its share of benefit costs. As the Department
correctly points out, whether an employer must be charged, or may be relieved
of, benefit costs is governed by Utah Code Ann. §§ 35A-4-306
and 35A-4-307 (1997). Consequently, resolution of this issue likewise raises
a question of statutory interpretation.
¶10
Because both issues require
the interpretation of statutes, they raise questions of law that we review
for correctness. SeeDrake v. Industrial Comm'n, 939 P.2d 177, 181
(Utah 1997) ("Where the issue is a question of law, . . . appellate review
gives no deference to the trial judge's or agency's determination . . .
.");
Bevans v. Industrial Comm'n, 790 P.2d 573, 575 (Utah Ct. App.
1990) ("'[A] court may decide that the agency has erroneously interpreted
the law if the court merely disagrees with the agency's interpretation.'")
(citation omitted).
TIMELINESS OF CLAIMANT'S APPEAL
¶11
NAC argues the administrative
rule authorizing filings at various employment centers is invalid because
it is inconsistent with Utah Code Ann. § 35A-4-406 (1997). The Department,
however, argues the statute simply designates who must receive an appeal
but does not address the method by which such appeal must be received.
We agree with the Department.
¶12
"It is a long-standing principle
of administrative law that an agency's rules must be consistent with its
governing statutes." Sanders Brine Shrimp v. Audit Div. of the Utah
State Tax Comm'n, 846 P.2d 1304, 1306 (Utah 1993). Nonetheless, we
grant an administrative rule a presumption of validity in determining whether
the rule is consistent with governing statutes. See South Cent.
Utah Tel. Ass'n, Inc. v. Auditing Div. of the Utah State Tax Comm'n,
951 P.2d 218, 223 (Utah 1997). When interpreting a statute and determining
whether a regulation is consistent, we look first to the plain meaning
of the words used by the Legislature. See Valcarce v. Fitzgerald,
961 P.2d 305, 318 (Utah 1998); Eaton Kenway, Inc. v. Auditing Div. of
the Utah State Tax Comm'n, 906 P.2d 882, 886 (Utah 1995). At the same
time, we construe Utah's Employment Security Act "'liberally in favor of
affording benefits.'" Armstrong v. Department of Employment Sec.,
834 P.2d 562, 564 (Utah Ct. App. 1992) (citation omitted). Moreover, "'"[r]ules
made in the exercise of a power delegated by the statute(2)
should be construed together with the statute to make, if possible, an
effectual piece of legislation in harmony with common sense and sound reason."'"
Crossroads Plaza Ass'n v. Pratt, 912 P.2d 961, 965 (Utah 1996) (citations
omitted). We conclude Rule 994-406-309 is consistent with section 35A-4-406(3)(a).
¶13
That section describes the
rights of a claimant or employer to appeal a decision made by the Department:
The claimant or
any other party entitled to notice of a determination as provided by department
rule may file an appeal from the determination with the Division of
Adjudication within ten days after the date of mailing of the notice
of determination or redetermination to the party's last-known address or,
if the notice is not mailed, within ten days after the date of delivery
of the notice.
Utah Code Ann. § 35A-4-406(3)(a)
(1997) (emphasis added). This section thus requires a party intending to
appeal the Department's initial determination to communicate that intention
to the Division of Adjudication within ten days.(3)
The Department promulgated a rule describing the particular methods available
for filing a notice of appeal:
An appeal must be
filed in writing by mailing a signed letter to the mailing address of the
Appeals Tribunal as shown on the notice of decision, or submitting a written
statement at an employment center.
Utah Code Admin. P. R994-406-309
(Supp. 1997). Construing this statute and rule in harmony, it is clear
the statute describes
who must receive the appeal, while the rule
describes a procedure for how this may be accomplished.
¶14
NAC has demonstrated no
way in which the statute is undercut by authorizing delivery at an employment
center, a satellite office of the same department of which the Division
of Adjudication is a part. It is reasonable and rational for the Department
to flesh out directions for the time, place, and manner of filing an appeal.
Such directions simply help effectuate, and thus do not contradict, the
statutory goal of providing notice of an intent to appeal to the Division
of Adjudication.(4) Thus, section 35A-4-406(3)(a)
directs appeals of initial Department decisions to be filed with the Division
of Adjudication, but does not precisely script how that shall happen. Utah
Administrative Code R994-406-309 fills in this gap by prescribing the permitted
methods for filing an appeal with the Division. The rule is consistent
with section 35A-4-406(3)(a), and thus is valid. Accordingly, the Appeals
Board correctly concluded that claimant's initial appeal, filed at an employment
center within ten days of the decision, was timely filed at an appropriately
authorized location.
ASSESSMENT OF BENEFIT COSTS
¶15
NAC also argues that if
the Department could allow filing of appeals at employment centers, the
Department should bear the burden of any flaw in their procedures for forwarding
the appeals to the Division of Adjudication, and therefore should not assess
NAC its share of benefit costs. Although NAC's delayed notice of the appeal
and the inexplicable shortcomings in the Department's procedures for handling
important documents make this avenue attractive, we are not persuaded we
can simply relieve NAC of its benefit costs, nor are we convinced such
a remedy is warranted in this case.
¶16
We recognize that although
section 35A-4-306 requires the Department to assess employers their share
of benefit costs, section 35A-4-307 characterizes some benefit costs as
"social costs" for which, for various reasons, employers need not pay.
See Utah Code Ann. §§ 35A-4-306, -307 (1997); Professional
Staff Management, Inc. v. Department of Employment Sec., 953 P.2d 76,
77-78 (Utah Ct. App. 1998) (explaining the "charge-back" system);
Allen
v. Department of Employment Sec., 781 P.2d 888, 890-91 (Utah Ct. App.
1989) (holding benefit costs resulting from voluntary quit were social
costs and could not be charged to employer). Although social costs are
particularly described, see Utah Code Ann. § 35A-4-307(1)(a)-(f)
(1997), this section also contains a residual provision defining social
costs as benefit costs not otherwise chargeable to the employer. See
id. § 35A-4-307(1)(g) ("Any benefit costs that are not charged
to an employer and not defined in this subsection are also social costs.").
We are urged to treat NAC's benefit costs in this case as social costs.
However, no provision in the Employment Security Act expressly authorizes
otherwise validly assessed benefit costs to be treated as social costs
merely because the employer received delayed notice that claimant wished
to appeal the initial determination.
¶17
Further, we are not convinced
that a balance of the equities here warrants treating NAC's benefit costs
as social costs. Because the Department employed a clearly inefficient
system for handling appeals filed at employment centers,(5)
some sanction might be justified. However, social costs are not paid from
the pockets of inept Department employees or even from the Department's
budget, but rather from the Unemployment Compensation Fund, to which all
employers contribute. See Utah Code Ann. §§ 35A-4-301
to -313 (1997 & Supp. 1998) (governing employer contributions); id.
§ 35A-4-401(1) (1997) (providing that unemployment benefits are paid
from the fund); id. § 35A-4-501 (1997) (establishing and governing
the fund). Consequently, characterizing these benefit costs as social costs
would shift their expense not onto the Department, but onto all employers.
Given the choice between entirely blameless employers and NAC, who discharged
claimant without good cause and thus created the need for claimant to seek
unemployment benefits, NAC should bear its appropriate share of the cost
of claimant's unemployment benefits.
CONCLUSION
¶18
The Workforce Appeals Board
correctly concluded that because Utah Administrative Code R994-406-309
is consistent with Utah Code Ann. § 35A-4-406 and therefore valid,
claimant's appeal was timely filed. We reject NAC's argument that we may
relieve it of its properly assessed share of benefit costs. Accordingly,
we deny NAC's petition for relief.
______________________________
Gregory K. Orme, Judge
-----
¶19
WE CONCUR:
______________________________
Pamela T. Greenwood,
Associate Presiding Judge
______________________________
Russell W. Bench, Judge
1. NAC did not challenge the ALJ's determination that claimant was discharged without just cause.
2. The Department has expressly been granted authority to adopt pertinent rules: "In accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the department shall make rules governing adjudicative procedures including the forms of notices and the manner of serving notice in all claims." Utah Code Ann. § 35A-1-303(1)(a) (1997).
3. "Division of Adjudication," the term used in the statute, "Appeals Tribunal," used in the administrative rule next quoted, and "Appeals Section," the term employed in the notice of decision sent to claimant, all refer to the same step in the unemployment claim process, i.e., review by a Department administrative law judge of the initial administrative determination of eligibility and benefits.
4. We note that if, as the Department claims, its goal in allowing filing at employment centers is to "make governmental systems more user-friendly to the citizens and taxpayers," their current system needs immediate attention. That is, neither of claimant's two appeals filed at employment centers reached the Division of Adjudication, and claimant had to write three separate letters of appeal. However, the obvious need for a more formal, routinized procedure for logging and receipting documents delivered, and for routing documents to the Division of Adjudication after filing, does not itself make the filing at an employment center inconsistent with section 35A-4-406(3)(a).
5. We use the past tense advisedly. At oral argument, counsel for the Department assured us the Department would immediately implement appropriate procedures for receipting, tracking, and transmitting these important documents.
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.