Unemployment Insurance: Can You Be Denied Benefits for "Misconduct"?

 Posted on February 18, 2016 in General & Commercial Litigation

By Patrick M. Kinnally

An employee cannot collect unemployment benefits if he or she has been discharged for "misconduct" in connection with their job. But what type of misconduct creates ineligibility?

Section 602 (A) of the Illinois Unemployment Insurance Act 820 ILCS 405/602(A) says that misconduct is:

"The deliberate and willful violation of a reasonable rule or policy of the employing unit, governing the individual's behavior in performance of his work, provided such violation has harmed the employing unit or other employees or has been repeated by the individual despite a warning or other explicit instruction from the employing unit."

Therefore, misconduct occurs only if the facts meet three requirements: a deliberate and willful violation; of a reasonable rule or policy of the employer governing the individual's behavior in the performance of his work; and, which either harmed the employer or a fellow employee, or was repeated despite a warning or explicit instruction from the employer. (Petrovic v. Department of Employment Security 2016 IL 118562)

Although an Illinois employer has the right to fire an at‑will employee for any reason or no reason at all, a different legal standard applies to a terminated employee's right to receive unemployment insurance benefits.  For benefits to be denied, the misconduct must be willful or performed consciously in violation of a reasonable company rule known to the employee. In other words, the employee must know that his conduct was prohibited by a company rule. The rule need not be in writing but it needs to have been clearly expressed by the employer in order to place the employee on notice that violation could result in termination. Also, there must be a showing of harm to the employer or a fellow employee. Finally, it appears that a warning to the employee of the alleged misconduct should occur before the employee will be disqualified for unemployment benefits.

The purpose of the Unemployment Insurance Act is provide a modicum of relief to separated employees. Involuntary unemployment creates economic insecurity for many families. Accordingly, it is liberally construed, as it should be, in favor of awarding unemployment benefits to unemployed workers.

Sources:

http://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2434&ChapterID=68

http://www.illinoiscourts.gov/opinions/SupremeCourt/2016/118562.pdf