Question

We recently terminated an employee for performance issues. Can he receive unemployment when his termination was for poor performance?

Answer

It depends upon the nature of the performance issue.

An employee will be denied benefits if the termination is “attributable to deliberate misconduct in willful disregard of the employing unit’s interest, or to a knowing violation of a reasonable and uniformly enforced rule or policy of the employer, provided that such violation is not shown to be as a result of the employee’s incompetence.” (M.G.L. ch. 151A, § 25(e))

Many terminations for performance are strictly related to poor performance and are not the result of “deliberate misconduct” or a “knowing violation” of an employer policy. In a situation such as this, the credibility of the documentation supporting the allegation of deliberate misconduct, or a knowing violation is crucial.

Termination for poor performance generally does not lead to a denial of benefits.  A recent appeal brought by a former employee of the Department of Unemployment Assistance (DUA) to the state’s Division of Administrative Law Appeals (DALA) illustrates the distinction between incompetence and deliberate misconduct or a knowing violation of a reasonable and uniformly enforced policy of the employer.  DUA is ironically the agency responsible for administering the state’s unemployment insurance system.

The DUA terminated the remote employee for an extremely low level of productivity, which was evidenced in the agency’s systems.  The employer had investigated her work performance by reviewing her activity in these systems and determined that there were long periods where she did not perform any work.   There were days when she did not even log into the system.  When she applied for unemployment benefits, the DUA rejected her application.

Because she was a state employee, she had to pursue her claim through the state’s administrative law process. The DALA magistrate agreed with the DUA that the employee’s termination was a result of a knowing violation of its reasonable and uniformly enforced work rule or policy, as her falsification of time records was a violation of its code of conduct.

It can sometimes be difficult to distinguish between non-performance and incompetence, as not all employers have the solid evidence that the DUA had in this case.  Employers are advised to carefully investigate and document violations of policies before termination because evidence of wrongdoing will be important if the company wants to contest the DUA’s  award of unemployment benefits to a claimant.

Employee handbooks should include a code of conduct listing specific activities such as falsification of time records, making it easier for employers to categorize wrongdoing as a policy violation. And supervisors should get into the habit of regularly documenting incidents that constitute a violation of company policy to help fight a claim. Employers should take heart that even the DUA can show the path forward by marshaling a solid case to justify its denial of benefits.

AIM members may call the AIM HR Helpline at 800-470-6277 with questions about unemployment or any other human-resource matter.