Ching v. Unemployment Appeals Commission

Citations: 783 So. 2d 367; 2001 Fla. App. LEXIS 5938; 2001 WL 467554Docket: No. 5D00-895

Court: District Court of Appeal of Florida; May 4, 2001; Florida; State Appellate Court

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Ching appealed an order from the Florida Unemployment Appeals Commission affirming an appeals referee's decision that he must repay $5,000 in unemployment benefits due to receiving a back pay award from his employer, Meisner Electric, Inc., for the same period. Ching was discharged in 1998, prompting his union to file an unfair labor practice charge with the National Labor Relations Board (NLRB), which resulted in Meisner being ordered to rehire Ching and compensate him for lost earnings. After an unsuccessful reemployment attempt, Ching applied for unemployment benefits while the NLRB proceedings continued. A settlement agreement was reached, stipulating Meisner would pay Ching back pay calculated according to a standard formula, excluding certain tax deductions. In April 1998, a formal settlement was executed, confirming Meisner owed Ching $13,733 plus interest. Ching later received a net amount of $9,106 after taxes. Subsequently, a Florida claims adjudicator re-evaluated Ching's eligibility for unemployment benefits, concluding he was ineligible from March 19, 1997, to December 31, 1997, due to the back pay exceeding the weekly benefit amount. The Commission ruled that this back pay constituted "earned income" under Florida law, which includes various forms of remuneration such as back pay awards. The court maintained that federal law does not preempt state law in this situation, noting that some states allow recoupment of benefits paid during periods covered by NLRB back pay awards.

Recoupment of unemployment compensation is a matter between the State and its employees. In Nash v. Florida Industrial Commission, the Supreme Court ruled that states can recoup unemployment benefits paid during periods covered by NLRB back-pay awards. The Baker case reiterated that federal law does not prevent states from deciding on compensation for employees who cause their own unemployment. The Ninth Circuit in Moreno Roofing Co. Inc. v. Nagle established that the Garmon preemption doctrine does not apply when state laws addressing peripheral concerns, such as California's requirement for employers to repay unemployment benefits when an employee receives NLRB back pay, are involved. 

Ching contends that section 443.036(16) does not consider back pay as earned income, asserting that individuals are fully unemployed if they perform no services and receive no earned income. However, the statute explicitly includes back-pay awards in its definition of 'earned income' and 'wages,' without exceptions for NLRB awards. The disqualifying section 443.101(3) states that a person is disqualified if receiving wages in lieu of notice, which parallels the situation with back pay since neither involves actual work performed.

Ching argues the Commission's order should be overturned due to lack of substantial evidence supporting the finding of his unemployment benefits. On remand, the referee was tasked with determining whether Ching received unemployment benefits, the amount, and the time frame for the back pay award. The $14,000 back pay was determined to cover March 17, 1997, to November 31, 1997, at a rate of $341.15 per week, rendering Ching ineligible for $5,000 in unemployment benefits for overlapping weeks, as his back pay exceeded the state benefits. Ching disputes the period covered by the back pay award, claiming it should start January 8, 1998, due to a waiver of reemployment rights; however, evidence supporting this claim is lacking, and testimony indicated that the parties did not resolve the 1997 re-employment dispute using the standard Board formula to specify the back pay period.

The negotiation between the parties resulted in a $14,000 payment to Ching in exchange for his waiver of re-employment rights, specifically for the year 1998. Ching argued that this amount constituted compensation for foregoing re-employment rather than back pay; however, the written agreement does not support this interpretation. The unexecuted draft of the agreement refers to "loss of pay," and the Settlement Stipulation from the 1997 NLRB case explicitly mentions a back pay amount of $13,733. The court emphasized that parties are bound by the explicit language of their agreements, and any conflicting interpretations are not permissible. The ruling was affirmed by Justices Griffin and Sawaya. Additionally, the excerpt references Florida statutes regarding unemployment benefits and a related Supreme Court ruling that highlighted the financial burdens on claimants filing complaints with the NLRB, which could hinder their ability to engage with the NLRA.