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Ziemer v. GovDelivery, Inc.

Court of Appeals of Minnesota

December 23, 2013

Lisa Ziemer, Relator,
v.
GovDelivery, Inc., Respondent, Department of Employment and Economic Development, Respondent.

UNPUBLISHED OPINION

Department of Employment and Economic Development File No. 30410545-3.

Daniel Gray Leland, Joni M. Thome, Frances E. Baillon, Baillon Thome Jozwiak & Wanta, LLP, Minneapolis, Minnesota (for relator).

Daniel G. Prokott, Faegre Baker Daniels, Minneapolis, Minnesota (for respondent GovDelivery, Inc.).

Lee B. Nelson, Christine Hinrichs, Minnesota Department of Employment and Economic Development, St. Paul, Minnesota (for respondent Department of Employment and Economic Development).

Considered and decided by Halbrooks, Presiding Judge; Ross, Judge; and Crippen, Judge. [*]

HALBROOKS, Judge.

Relator challenges the determination of the unemployment-law judge (ULJ) that her settlement payment constituted, at least in part, compensation for back pay, and is therefore deductible from her unemployment benefits. Because there is substantial evidence in the record to support the ULJ's findings and because the ULJ did not err in applying the law, we affirm.

FACTS

Relator Lisa Ziemer worked for respondent GovDelivery, Inc., as a technical operations manager earning $2, 242.31 per week from August 29, 2011, until the company terminated her employment on May 3, 2012. GovDelivery offered Ziemer two weeks of severance pay on the day of her termination, but she refused the offer because she believed she had claims of alleged discrimination. Ten days later, Ziemer established an unemployment-benefits account and began receiving $597 per week in benefits. She sought employment from May 4 to August 8, 2012, before taking a job that paid approximately $30, 000 less per year than her GovDelivery salary.

On October 17, 2012, Ziemer signed a confidential settlement agreement with GovDelivery in exchange for a release of her claims against the company. Her settlement consisted of three parts: $30, 592.40 that was treated as W-2 income and subject to payroll taxes and deductions, emotional-distress damages that was treated as 1099 income, and attorney fees. Ziemer did not receive any portion of the settlement until November 1, 2012.

Respondent Minnesota Department of Employment and Economic Development (DEED) issued an ineligibility determination on December 11, 2012, that stated that Ziemer's benefits should have been delayed until August 8, 2012, due to payments received relating to separation from employment, and that she had therefore been overpaid $4, 776. DEED determined that the $30, 592.40 settlement payment that Ziemer received related to her "leaving employment" was not "earnings for work performed, " and may have included "wages in lieu of notice, severance pay, notice pay, or a retention bonus."

Ziemer appealed the DEED determination to a ULJ, arguing that she had been paid for releasing GovDelivery from all claims, not for severance. At an evidentiary hearing, both Ziemer and GovDelivery refused to discuss their settlement negotiations or provide the ULJ with a copy of the settlement agreement. The ULJ determined that "[t]he $30, 592.40 was paid in unknown parts as severance, lost wages, and a settlement of claims." The ULJ further concluded that the preponderance of the evidence demonstrated that the $30, 592.40 "was wages and was paid because of and after separation" from GovDelivery and therefore Ziemer was ineligible to receive benefits from May 4 until August 8, 2012. As a result, she ...


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