Wisconsin Dept. of Industry, Labor and Human Relations, Unemployment Compensation Div. v. Labor and Industry Review Com'n

• Decision Date: 13 February 1990
• Docket Number: No. 89-1540,89-1540
• Citation: 155 Wis.2d 256,456 N.W.2d 162
• Parties: , 60 Ed. Law Rep. 944 WISCONSIN DEPARTMENT OF INDUSTRY, LABOR AND HUMAN RELATIONS, UNEMPLOYMENT COMPENSATION DIVISION, Plaintiff-Appellant, v. LABOR AND INDUSTRY REVIEW COMMISSION, Yvonne Smithson, and D C Everest Area School District, Defendants-Respondents.
• Court: Wisconsin Court of Appeals

Page 162

456 N.W.2d 162

155 Wis.2d 256, 60 Ed. Law Rep. 944

WISCONSIN DEPARTMENT OF INDUSTRY, LABOR AND HUMAN RELATIONS UNEMPLOYMENT COMPENSATION DIVISION, Plaintiff-Appellant, v. LABOR AND INDUSTRY REVIEW COMMISSION, Yvonne Smithson, and D C Everest Area School District, Defendants-Respondents.

No. 89-1540.

Court of Appeals of Wisconsin.

Submitted on Briefs Jan. 31, 1990.

Opinion Released Feb. 13, 1990.

Opinion Filed Feb. 13, 1990.

Gregory A. Frigo and Mary Lynn Endter, Madison, for plaintiff-appellant.

Earl G. Buehler, Madison, for defendants-respondents.

Bruce Meredith and Valerie Gabriel of the Wisconsin Educ. Ass'n Council, Madison, for defendant-respondent Yvonne Smithson.

Before CANE, P.J., and LAROCQUE and MYSE, JJ.

CANE, Presiding Judge.

The Wisconsin Department of Industry, Labor and Human Relations appeals a circuit court decision, upholding a Labor and Industry Review Commission determination that Yvonne Smithson was entitled to unemployment compensation. Smithson had been employed during a school year as a full-time substitute teacher by the D C Everest Area School District. Near the end of the school year, the school district informed Smithson that while she would remain on the substitute teaching list the following fall, it did not anticipate more full-time work. DILHR argues that this is a reasonable assurance of reasonably similar employment under sec. 108.04(17)(a), Stats., and Wis.Admin.Code, sec. ILHR 132.04(3). Smithson and LIRC disagree and argue that if the rule compels this conclusion, it conflicts with the statute and is invalid. The parties also ask us to address the more general question of LIRC's power to invalidate or alter DILHR rules. Finally, the parties disagree whether Smithson was entitled to attorney fees for prevailing at the circuit court level.

We uphold the circuit court's and LIRC's determinations rendering Smithson eligible for unemployment compensation, and hold invalid sec. ILHR 132.04(3) as contrary to sec. 108.04(17)(a), Stats. We also hold that while LIRC lacks the power to invalidate rules, it is authorized to reach its determinations on the basis of all applicable precedent. Finally, we overturn the award of costs and hold that DILHR's appeal of the LIRC determination was substantially justified.

The facts, as determined by LIRC, were as follows:

[Smithson] worked for about four years as a teacher for the employer, a public school district....

In mid-August 1987, the employe was offered and accepted a long-term substitute teacher contract from the employer which guaranteed full-time employment for the first semester of the 1987-1988 school year. In the second semester of that year, the employer expected the regular teacher to return and therefore the employe was not given a contract or guaranteed any minimum amount of work. However, the regular teacher did not return and the employe also worked full time in the second semester. The employer informed her at the end of January 1988, that the other teacher would not be returning for the spring semester, and she would remain as a long-term substitute teacher until June of 1988. Prior to the end of that school year, the employe was offered the opportunity to place her name on the substitute teacher list for the 1988-1989 school year.

DILHR denied Smithson's initial application for unemployment compensation benefits. Smithson requested a hearing and, following the hearing, an administrative law judge (ALJ) ruled that she was entitled to unemployment compensation. DILHR appealed to LIRC, which upheld the ALJ. DILHR then appealed to the circuit court, which also found that Smithson was entitled to benefits. In addition, the court found that sec. ILHR 134.02(3) was invalid.

Our review is of the LIRC decision, and our scope of review is identical to that of the circuit court. Nelson v. LIRC, 123 Wis.2d 221, 224, 365 N.W.2d 629, 630 (Ct.App.1985). In the absence of fraud, sec. 102.23(1), Stats., or lack of support by substantial and credible evidence, sec. 102.23(6), Stats., LIRC's factual findings are binding on this court. Here, LIRC's factual findings are not disputed. Commission decisions on questions of law are not binding on this court, see Nottelson v. DILHR, 94 Wis.2d 106, 116-17, 287 N.W.2d 763, 768 (1980), although generally we give deference to their legal conclusions. Fitzgerald v. Globe-Union, Inc., 35 Wis.2d 332, 337, 151 N.W.2d 136, 139 (1967).

In this case, contrary readings are urged on us by DILHR and LIRC, which both have special competence in this area. However, we decide that sec. ILHR 132.04(3), Wis.Admin.Code, is unambiguous and that this rule clearly conflicts with sec. 108.04(17)(a), Stats. Given the absence of ambiguity, we look only to the language of the statute and rule and need not concern ourselves with what degree of deference we would accord either agency were the statute or rule open to interpretation. See, e.g., Doe v. Roe, 151 Wis.2d 366, 374-75, 444 N.W.2d 437, 441 (Ct.App.1989).

Before reaching the merits of the determination itself, we first address the extent of LIRC's power to deviate from DILHR rules. The nature and scope of an agency's authority is a matter of statutory interpretation. City of Appleton v. Transportation Comm'n, 116 Wis.2d 352, 357, 342 N.W.2d 68, 71 (Ct.App.1983). We review questions concerning statutory interpretation de novo. Brown v. Thomas, 127 Wis.2d 318, 323, 379 N.W.2d 868, 870 (Ct.App.1985). DILHR argues that LIRC ignored the clear language of sec. ILHR 132.04(3), thereby implicitly amending or invalidating it. They point out that rulemaking authority in this area is clearly delegated to DILHR. Secs. 101.02(1) and 108.14(2), Stats.

The instances when a rule may be found invalid are enumerated in sec. 227.40, Stats. The applicable portion states:

The validity of a rule may be determined in any of the following judicial proceedings when material therein: ... (e) Proceedings under ... ch. ... 108 ... for review of decisions and orders of administrative agencies if the validity of the rule involved was duly challenged in the proceeding before the agency in which the order or decision sought to be reviewed was made or entered.

Sec. 227.40(2)(e), Stats. The statute allows for a rule to be declared invalid on judicial review of administrative agency decisions and orders. It does not grant LIRC the power to ignore or alter administrative rules. LIRC does have the final administrative review of disputes over benefit eligibility. Sec. 108.09(6), Stats. However, this is not a grant of power to invalidate DILHR rules. "Any reasonable doubt about whether an agency has power implied by a statute should be resolved against the exercise of such authority." City of Appleton, 116 Wis.2d at 358, 342 N.W.2d at 71.

Nevertheless, LIRC is not obligated to blindly follow DILHR's interpretations of its rules. LIRC's obligation is to review the ALJ's legal conclusions using normal rules of construction in interpreting rules and statutes and reconciling seemingly conflicting statutes or rules. ¹ In this case, LIRC attempted to reconcile sec. 108.04(17)(a), Stats., and sec. ILHR 132.04(3). To the extent that LIRC erred and, for example, misconstrued an unambiguous rule, its decision is reviewable.

Our primary inquiry is whether sec. ILHR 132.04(3) can be read so as not to conflict with sec. 108.04(17)(a), Stats., as interpreted in Leissring v. DILHR, 115 Wis.2d 475, 340 N.W.2d 533 (1983). ² Section 108.04(17)(a) provides:

An employe of an educational institution or an employe of a government unit or nonprofit organization who provides services to or on behalf of an educational institution and who performs services in an instructional, research or principal administrative capacity is ineligible for benefits based on such services for any week of unemployment which occurs during a period between 2 successive academic years or 2 regular terms, whether or not successive, if such employe performed such services in the first such academic year or term and if there is a contract or a reasonable assurance that such employe will perform such services in the 2nd such academic year or term.

In Leissring, our supreme court interpreted the phrase "reasonable assurance that such employe will perform such services." ³ The court determined that two full-time teachers who were offered part-time teaching positions for the following year were eligible for unemployment compensation under the statute. The court stated:

An interpretation of sec. 108.04(17)(a), Stats., as requiring a reasonable assurance of employment in the following year with terms, benefits, and conditions that are reasonably similar to those of the preceding year, is also consistent with other provisions of ch. 108. ...

... It is inconsistent to allow a teacher to retain benefit eligibility when he or she refuses substandard employment or employment having substantially reduced wages and hours, yet deny eligibility to the teacher during the summer period simply because he or she was offered the possibility of employment with substantially less favorable terms and conditions than those of the teacher's previous employment.

Id. at 490-92, 340 N.W.2d at 540. ⁴ Leissring dealt with only full-time teachers. Following the decision, DILHR promulgated sec. ILHR 132.04(3) (Aug.1987):

Substitute Teachers. This subsection only applies to substitute teachers under s. 108.04(17)(a) and (c), Stats. A substitute teacher who worked in the academic year or term immediately preceding the weeks of unemployment which occurred between academic years or terms or during an established and customary vacation period or holiday recess has assurance of reasonably similar employment if he or she receives assurance from any educational institution of any employment as a substitute teacher, part-time teacher or full-time teacher, in the academic year or term immediately following the weeks of unemployment.

Substitute...