DWD v. LIRC

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
May 10, 2022
A party may file with the Supreme Court a
Sheila T. Reiff petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10
and RULE 809.62.

Appeal No. 2020AP2002 Cir. Ct. No. 2020CV2371

STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT I

WISCONSIN DEPARTMENT OF WORKFORCE DEVELOPMENT,

PLAINTIFF-RESPONDENT,

V.

LABOR AND INDUSTRY REVIEW COMMISSION,

DEFENDANT-APPELLANT,

SUSAN A. WOZNIAK AND MEIJER STORES LIMITED PARTNERSHIP,

DEFENDANTS.

APPEAL from an order of the circuit court for Milwaukee County:
WILLIAM S. POCAN, Judge. Affirmed.

Before Donald, P.J., Dugan and White, JJ.
No. 2020AP2002

¶1 DONALD, P.J. The Labor and Industry Review Commission
(LIRC) challenges a circuit court order reversing its decision to grant
unemployment benefits to Susan A. Wozniak. As discussed below, we conclude
that Wozniak’s use of derogatory, homophobic language about her coworker’s
sexual orientation constituted misconduct, pursuant to WIS. STAT. § 108.04(5)(d)
(2019-20),1 and as a result, she is not entitled to unemployment benefits.

BACKGROUND

¶2 On October 17, 2017, Wozniak began working as a part-time greeter
for Meijer Stores Limited Partnership (Meijer). Approximately, seven weeks
later, Wozniak became angry that a coworker, who was supposed to be working
with her as a greeter at the front of the store, was not doing his job. Wozniak
expressed her irritation in a conversation with two cashiers. Several days later,
one of the cashiers reported the conversation to management. The cashier
reported that Wozniak had referred to the coworker as “pretty boy,” “fairy,” and
“fruit loop,” said that he was gay, and that “the way he skipped around the store
made her sick.” Neither of the cashiers testified at the hearing in this matter.

¶3 Management interviewed Wozniak. Wozniak denied calling her
coworker a “fairy.” She provided a written statement in which she admitted to
calling her coworker a “pretty boy,” and stated that if she mentioned other things,
she “didn’t mean it and should not have said it.” Wozniak was suspended pending
further investigation. Wozniak had not previously been subject to discipline.

1
All references to the Wisconsin Statutes are to the 2019-20 version unless otherwise
noted.

2
No. 2020AP2002

¶4 On December 15, 2017, Meijer discharged Wozniak for making
“discriminatory remarks towards a team member, calling him a ‘fruit loop’ and a
‘fairy,’ and commenting on how he skipped around and it made her sick.”

¶5 Wozniak filed a claim for unemployment insurance benefits. Based
on the information provided by Wozniak, the Department of Workforce
Development (DWD) issued an initial determination on January 12, 2018. DWD
found that Wozniak was discharged, but her discharge was not for misconduct or
substantial fault connected with her employment. Benefits were, therefore,
allowed.

¶6 Meijer appealed. A hearing on the matter was held before a DWD
administrative law judge (ALJ). The ALJ found that Wozniak had referred to her
coworker as a “pretty boy” and a “fruit loop.” The ALJ reversed the initial
determination, finding that Wozniak was discharged for misconduct, pursuant to
WIS. STAT. § 108.04(5), and, thus, was ineligible for benefits.

¶7 Wozniak petitioned for review of the appeal tribunal decision to
LIRC. In a decision dated November 30, 2018, LIRC reversed the ALJ’s decision,
thus, allowing benefits. Two commissioners found that Wozniak was discharged,
but not for misconduct, pursuant to WIS. STAT. § 108.04(5) and (5)(d), or
substantial fault, pursuant to § 108.04(5g). One commissioner dissented, finding
that Wozniak’s comments regarding her coworker’s sexual orientation constituted
misconduct pursuant to § 108.04(5) and (5)(d), and also substantial fault, pursuant
to § 108.04(5g).

¶8 DWD sought judicial review, and on August 16, 2019, the circuit
court issued a decision finding that LIRC erred as a matter of law by defining
harassment under WIS. STAT. § 108.04(5)(d) as requiring more than one act. The

3
No. 2020AP2002

circuit court remanded the case to LIRC to issue a new decision based on the
correct interpretation of the statute.

¶9 Following the remand, LIRC issued a new decision on March 12,
2020. LIRC again found that Meijer discharged Wozniak, but that her discharge
was not for misconduct or substantial fault connected with her employment.
Therefore, Wozniak was eligible for benefits.

¶10 DWD brought an action for judicial review of LIRC’s second
decision. The circuit court reversed. The circuit court found that LIRC erred in
finding that Wozniak’s comments did not constitute misconduct or substantial
fault.

¶11 LIRC appealed that decision to this court. Additional relevant facts
are referenced below.

DISCUSSION

¶12 “Wisconsin’s unemployment compensation statutes embody a strong
public policy in favor of compensating the unemployed.” Operton v. LIRC, 2017
WI 46, ¶31, 375 Wis. 2d 1, 894 N.W.2d 426. Not all employees, however, are
entitled to unemployment benefits. Id., ¶33. An individual may be disqualified
from receiving benefits if the employer establishes that the individual was
discharged under a disqualifying provision. Id., ¶¶33, 38.

¶13 LIRC utilizes a three-step approach in analyzing discharges. First,
LIRC determines whether the employee was discharged for misconduct by
engaging in any of the actions enumerated in WIS. STAT. § 108.04(5)(a)-(g). If
those provisions do not apply, LIRC then determines whether the employee’s
actions constitute misconduct under § 108.04(5), the codified misconduct

4
No. 2020AP2002

definition from Boynton Cab Co. v. Neubeck, 237 Wis. 249, 296 N.W. 636
(1941). Finally, if misconduct is not found, LIRC then determines whether the
discharge was for substantial fault, as set forth in § 108.04(5g).

¶14 In this case, LIRC contends Wozniak’s discharge was not for
misconduct within the meaning of WIS. STAT. § 108.04(5) or (5)(d), or substantial
fault under § 108.04(5g).

¶15 As discussed below, we conclude that Wozniak’s discharge was for
misconduct within the meaning of WIS. STAT. § 108.04(5)(d) and, thus, we affirm
the denial of benefits. As a result, we do not address whether Wozniak’s
discharge was for misconduct within the meaning of § 108.04(5) or substantial
fault under § 108.04(5g). See State v. Blalock, 150 Wis. 2d 688, 703, 442 N.W.2d
514 (Ct. App. 1989) (stating that “cases should be decided on the narrowest
possible ground”).

A. Principles of Law and Standard of Review

¶16 “On appeal, we review LIRC’s decision and not the circuit court’s.”
City of Kenosha v. LIRC, 2011 WI App 51, ¶7, 332 Wis. 2d 448, 797 N.W.2d
885. A reviewing court “may set aside an order of LIRC if LIRC acted ‘without
or in excess of its powers.’” DWD v. LIRC, 2018 WI 77, ¶12, 382 Wis. 2d 611,
914 N.W.2d 625 (citing WIS. STAT. § 108.09(7)(c)6.a.). LIRC acts without or in
excess of its powers if it bases its order on an incorrect interpretation of the law.
Id.

¶17 This case requires us to interpret WIS. STAT. § 108.04(5)(d).
Statutory interpretation begins with the language of a statute. State ex rel. Kalal v.
Circuit Ct. for Dane Cnty., 2004 WI 58, ¶45, 271 Wis. 2d 633, 681 N.W.2d 110.

5
No. 2020AP2002

If the meaning of a statute is plain, we ordinarily stop our inquiry. Id. “Statutory
language is given its common, ordinary, and accepted meaning, except that
technical or specially-defined words or phrases are given their technical or special
definitional meaning.” Id. “A dictionary may be utilized to guide the common,
ordinary meaning of words.” Noffke ex rel. Swenson v. Bakke, 2009 WI 10, ¶10,
315 Wis. 2d 350, 760 N.W.2d 156.

¶18 “Statutory interpretation is a matter of law which we review de novo,
giving no deference to the agency’s legal conclusions.” Cree, Inc. v. LIRC, 2022
WI 15, ¶13, 400 Wis. 2d 827, 970 N.W.2d 837. “Whether the facts of a case
fulfill a legal standard is also a matter of law we review de novo.” Id.2

B. WISCONSIN STAT. § 108.04(5)(d)

¶19 WISCONSIN STAT. § 108.04(5)(d) provides that “[o]ne or more
threats or acts of harassment, assault, or other physical violence instigated by an
employee at the workplace of his or her employer” constitutes misconduct. The
statute does not define harassment.

¶20 Citing Black’s Law Dictionary, LIRC defines “harassment” as “a
term used in a variety of legal contexts to describe words, gestures, and actions

2
LIRC notes that a reviewing court may accord “due weight” to a commission’s
experience, technical competence, and specialized knowledge. See Tetra Tech EC, Inc. v. DOR,
2018 WI 75, 382 Wis. 2d 496, 914 N.W.2d 21. DWD responds that this standard only applies to
general administrative proceedings under WIS. STAT. ch. 227, not unemployment proceedings
under WIS. STAT. ch. 108. Even if we assume that due weight may be given in unemployment
proceedings under chapter 108, LIRC admits that the interpretation of WIS. STAT. § 108.04(5)(d)
is a question of first impression. Thus, LIRC cannot be said to have any level of expertise or
specialized knowledge in interpreting § 108.04(5)(d). See Tetra Tech EC, 382 Wis. 2d 496, ¶79.
Accordingly, we conclude that a de novo standard of review is appropriate here.

6
No. 2020AP2002

which tend to annoy, alarm, and abuse (verbally) another person.”3 LIRC’s
decision further states that “[h]arassment may include verbal abuse, epithets, and
vulgar or derogatory language, display of offensive cartoons or materials,
mimicry, lewd or offensive gestures, and telling of jokes offensive to protected
class members.”

¶21 DWD agrees with LIRC’s definition of harassment. DWD and
LIRC disagree, however, as to whether Wozniak’s homophobic comments
constitute harassment.

¶22 We agree with DWD that Wozniak’s homophobic comments qualify
as harassment under WIS. STAT. § 108.04(5)(d). The agreed upon definition of
harassment includes the use of “derogatory language.” As the circuit court
observed, Wozniak’s comments, which included the use of “pretty boy” and “fruit
loop,” were “derogatory language” about the coworker’s sexual orientation.
Whether the comments were made directly to the coworker is of no consequence
under the language of § 108.04(5)(d).

¶23 In support of its argument that Wozniak’s comments did not
constitute misconduct pursuant to WIS. STAT. § 108.04(5)(d), LIRC faults Meijer
for not providing a specific definition of harassment, or examples of harassment,
in its work rules. LIRC also argues that Meijer did not prove that Wozniak
“knowingly” violated Meijer’s work rules.

¶24 LIRC, however, reads additional requirements into WIS. STAT.
§ 108.04(5)(d). Nothing in (5)(d) requires that an employer have an anti-

3
LIRC cites the Sixth edition of Black’s Law Dictionary.

7
No. 2020AP2002

harassment policy or rule. Nor does (5)(d) say that an employee must “knowingly
harass” or “intend to harass” another. Rather, (5)(d) simply provides that “[o]ne
or more threats or acts of harassment … instigated by an employee at the
workplace of his or her employer” constitutes misconduct. We will not read
additional language into a statute. See County of Dane v. LIRC, 2009 WI 9, ¶33,
315 Wis. 2d 293, 759 N.W.2d 571.

¶25 Finally, we note that the dissent emphasizes that Wozniak’s
homophobic comments were made in the context of a short, private conversation
with two co-workers that Wozniak believed were like-minded. See Dissent, ¶34.
First, the record suggests that at least one of the co-workers was not in fact like-
minded or unaffected as Wozniak’s comments prompted him or her to report the
conversation to management. Second, by the dissent’s reasoning, so long as an
employee believes a conversation is private with like-minded individuals, his or
her comments cannot constitute misconduct under WIS. STAT. § 108.04(5)(d).
This is illogical. The statute contains no such limitation. See County of Dane,
315 Wis. 2d 293, ¶33.

CONCLUSION

¶26 Therefore, for the reasons stated above, we conclude that Wozniak
was discharged for misconduct pursuant to WIS. STAT. § 108.04(5)(d), and thus, is
not entitled to unemployment benefits.

By the Court.—Order affirmed.

Not recommended for publication in the official reports.

8
No. 2020AP2002(D)

¶27 DUGAN, J. (dissenting). I write separately because I would
conclude that Meijer has not met its burden to demonstrate that Wozniak was
discharged for misconduct or substantial fault within the meaning of WIS. STAT.
§ 108.04(5) or § 108.04(5g). Thus, I would uphold LIRC’s decision granting
unemployment benefits to Wozniak. Accordingly, I respectfully dissent.

¶28 Initially, I recite the following facts in addition to those already
provided. Meijer provided a Summary of Work Rules during the agency
proceedings.1 One rule was entitled “Serious Conduct Leading to Discipline or
Discharge” and stated that “[d]iscriminatory acts, sexual harassment or harassment
of any nature” is serious conduct leading to discipline or discharge. The rule does
not provide any definition of harassment. An additional rule entitled “Conduct
Leading to Discharge Without Prior Discipline” stated that “[v]iolent behavior of
any kind, including provoking or engaging in fighting, threatening, intimidation or
coercive conduct, using abusive language, possession of weapons on company
property, or interfering with other team members’ ability to work” may lead to
termination without prior discipline. Wozniak electronically acknowledged
receipt of these rules.

1
The Summary of Work Rules indicates that further explanation can be found in the
Company Policies & Procedures. Meijer bears the burden of demonstrating that Wozniak was
discharged for misconduct or substantial fault, and it has not provided its Company Policies &
Procedures. See Operton v. LIRC, 2017 WI 46, ¶38, 375 Wis. 2d 1, 894 N.W.2d 426. Thus, this
court is restricted to consideration of the Summary of Work Rules that has been provided.
No. 2020AP2002(D)

¶29 After the incident in question, Meijer terminated Wozniak’s
employment, citing to both of the aforementioned workplace rules. Specifically,
Meijer provided that Wozniak made “discriminating remarks towards a team
member” and deemed Wozniak’s remarks “harassment in the workplace.” The co-
worker who reported Wozniak’s remarks to management never testified during the
agency proceedings, and no evidence was provided that Wozniak’s comments
were offensive to her co-workers with whom she spoke or interfered with their
ability to work.

¶30 With these additional facts in hand, I proceed to the standard
applicable to this case. First, I agree with the Majority that this case presents an
issue of statutory interpretation, and as the Majority aptly summarizes the general
principles of statutory interpretation, I do not repeat them here.2 See Majority,
¶¶17-18. However, as relevant to my conclusion, it bears repeating that
“Wisconsin’s unemployment compensation statutes embody a strong public policy
in favor of compensating the unemployed.” Operton v. LIRC, 2017 WI 46, ¶31,
375 Wis. 2d 1, 894 N.W.2d 426. Thus, while not all employees are ultimately
entitled to unemployment benefits, we nonetheless must liberally construe the
provisions of WIS. STAT. ch. 108 consistent with the strong public policy favoring

2
As the Majority notes, this case does not present the issue of whether Meijer could
terminate Wozniak’s employment, and I similarly emphasize that this case presents only the issue
of whether Wozniak was discharged for misconduct or substantial fault such that she is not
entitled to unemployment benefits. “The question is only whether there was statutory
‘misconduct.’ The principle that violation of a valid work rule may justify discharge but at the
same time may not amount to statutory ‘misconduct’ for unemployment compensation purposes
has been repeatedly recognized[.]” Consolidated Constr. Co., Inc. v. Casey, 71 Wis. 2d 811,
819-20, 238 N.W.2d 758 (1976). Thus, even if Meijer appropriately discharged Wozniak
pursuant to a valid work rule—which is not the question presented here—misconduct must still
be analyzed under the meaning of the statute, and while Meijer’s work rules are relevant to the
analysis, Meijer’s work rules are not synonymous with misconduct under the statute.

2
No. 2020AP2002(D)

compensation of the unemployed. See id., ¶¶31-32. Moreover, it is the
employer’s burden to demonstrate that the employee’s termination was due to
misconduct or substantial fault. See id., ¶38. With these principles in mind, I turn
to the analysis of whether Wozniak was discharged for misconduct or substantial
fault within the meaning of either WIS. STAT. § 108.04(5) or § 108.04(5g).

¶31 The Majority concludes that Wozniak was discharged for
misconduct within the meaning of WIS. STAT. § 108.04(5)(d) because she engaged
in an act of harassment. Majority, ¶¶15, 20-22. It does not reach the issue of
misconduct under the general definition or the issue of substantial fault. Id., ¶15.
In reaching its conclusion, the Majority adopts the definition of harassment
provided by LIRC and concludes that Wozniak’s language was derogatory.
Id., ¶22. It then ends its analysis there.

¶32 I do not agree with the Majority’s conclusion because it fails to
consider the language of WIS. STAT. § 108.04(5)(d) in its entirety and consider
harassment within its statutory context. See State ex rel. Kalal v. Circuit Ct. for
Dane Cnty., 2004 WI 58, ¶46, 271 Wis. 2d 633, 681 N.W.2d 110. Rather, by
considering the language of § 108.04(5)(d) in its entirety and interpreting
harassment within its statutory context, I would conclude that the harassment that
rises to the level of misconduct within the meaning of the statute also requires an
element of intent. “Context is important to meaning.” Operton, 375 Wis. 2d 1,
¶28 (citation omitted). Further, I would conclude that this intent is missing from
Wozniak’s conduct, and therefore, Wozniak did not engage in misconduct as
defined by § 108.04(5)(d).

¶33 In full, WIS. STAT. § 108.04(5)(d) defines misconduct as “[o]ne or
more threats or acts of harassment, assault, or other physical violence instigated by

3
No. 2020AP2002(D)

an employee at the workplace of his or her employer.” Reading the statute as a
whole and placing “harassment” within its statutory context also requires
considering whether Wozniak’s conduct was “instigated,” meaning whether
Wozniak’s comments “goad[ed]” or “incite[d]” harassment. See Instigate,
BLACK’S LAW DICTIONARY (11th ed. 2019). As the definition of instigate
suggests, there has to be some intention behind the action in order to goad or incite
harassment. I would conclude that this intention to goad or incite harassment
towards her co-worker of whom Wozniak was privately complaining is missing.

¶34 As even the Majority describes, Wozniak used her chosen language
to refer to a co-worker with whom she was frustrated, and she used this language
in the context of one brief, private conversation with two of her co-workers with
whom she believed she shared an affinity. Her comments were not loud enough
for anyone to hear. She did not make her comments to customers, and she did not
make her comments directly to the co-worker about whom she was complaining.
The record is also devoid of evidence that either of these co-workers were
offended or unable to continue with their work responsibilities as a result of the
conversation. Thus, Wozniak’s comments were part of an isolated incident during
a brief, private, casual conversation that does not rise to the level of misconduct
and that demonstrates no intent to harass her co-worker within the meaning of
WIS. STAT. § 108.04(5)(d).

¶35 The Majority dismisses this context as irrelevant to the analysis,
simply looking to the words Wozniak used and nothing more. Majority, ¶22.
However, dismissing this context interprets the type of harassment that rises to the
level of misconduct out of its statutory context. The Majority rejects the context
of Wozniak’s comments, concluding that to do so effectively adds language to the
statute. Id., ¶24. However, in ignoring the context in which Wozniak’s comments

4
No. 2020AP2002(D)

were made fails to place “harassment” within its statutory context. Moreover, I do
not agree that this approach adds language to the statute. Thus, I would conclude
that the context of Wozniak’s comments is relevant to the analysis and in placing
the type of harassment that rises to the level of misconduct within the statutory
context, I would conclude that Wozniak’s conduct did not rise to the level of
misconduct defined in WIS. STAT. § 108.04(5)(d).

¶36 Having so concluded, I would additionally analyze whether
Wozniak’s conduct constituted misconduct generally or whether Wozniak’s
conduct constituted substantial fault. Here, I would conclude that Wozniak’s
conduct constitutes neither.

¶37 The general definition of misconduct first articulated in Boynton
Cab Co. v. Neubeck, 237 Wis. 249, 296 N.W. 636 (1941), and now codified in the
introduction of WIS. STAT. § 108.04(5) defines misconduct as

one or more actions or conduct evincing such willful or
wanton disregard of an employer’s interests as is found in
deliberate violations or disregard of standards of behavior
which an employer has a right to expect of his or her
employees, or in carelessness of such degree or recurrence
as to manifest culpability, wrongful intent, or evil design of
equal severity to such disregard, or to show an intentional
and substantial disregard of an employer’s interests, or of
an employee’s duties and obligations to his or her
employer.

¶38 Under this definition of misconduct, LIRC consistently applies a
standard that the conduct must be sufficiently egregious to rise of the level of
misconduct or the employee must be aware that his or her job is in jeopardy for
engaging in certain conduct. See Toland v. Nash Finch Co., Hearing
No. 11203620EC (LIRC Mar. 27, 2012) (“To sustain its burden to establish that an
employee’s violation of a workplace harassment policy is misconduct, employer

5
No. 2020AP2002(D)

typically needs to show that the harassing conduct was severe and pervasive, or, if
a single act, unusually egregious.”). As a general rule, an employee must be aware
of the employer’s requirements in order to find that an employee deliberately or
intentionally violated or disregarded the employer’s rules.

¶39 As described above, nothing about Wozniak’s conduct rises to the
level of misconduct under this definition. Her conduct lacks a willful or wanton
disregard of her employer’s interests. As one brief, private conversation, her
conduct was not sufficiently egregious, and the workplace rules provided by
Meijer gave Wozniak no reason to suspect that her job was in jeopardy for making
such comments to two co-workers in that conversation.

¶40 Meijer submitted a document containing its workplace rules that
contained no definition of harassment, and it also never presented testimony from
the co-worker who reported Wozniak’s comments to management. Furthermore,
the second workplace rule provided by Meijer applies to “violent behavior,” and
Wozniak’s comments made during a brief, private conversation cannot be
construed in any way as violent behavior. Therefore, I would conclude that
Wozniak did not engage in misconduct as provided by this general definition.

¶41 The DWD additionally argues that, in addition to having an interest
in Wozniak complying with the workplace rules, Meijer had an interest in having
Wozniak refrain from conduct that would expose Meijer to liability under either
the Wisconsin Fair Employment Act (WFEA), see WIS. STAT. §§ 111.31-.395, or
Title VII, see 42 U.S.C. §§ 2000e-2000e(17). It also argues that Meijer had an
interest in Wozniak refraining from conduct that would expose Meijer to
boycotting and protests in the current age of the internet and viral videos for
employing someone who makes homophobic comments. Both of these arguments

6
No. 2020AP2002(D)

confuse the issue. The issue is whether Wozniak engaged in misconduct within
the meaning of WIS. STAT. ch. 108, not whether Wozniak’s comments exposed
Meijer to liability under WFEA or Title VII, or whether public opinion would
support Meijer’s decision to continue to employ Wozniak.

¶42 Last, I would address whether this case qualifies for discharge for
substantial fault. Substantial fault is defined as “those acts or omissions of an
employee over which the employee exercised reasonable control and which violate
reasonable requirements of the employee’s employer.” WIS. STAT. § 108.04(5g).
The statute “defines substantial fault broadly,” but “the legislature did not
disqualify every employee who commits such errors from receiving
unemployment benefits.” Operton, 375 Wis. 2d 1, ¶36.

¶43 In this case, I would conclude that Wozniak was not discharged for
substantial fault because Wozniak had no reason to believe that her acts would
violate a reasonable requirement of her employer. As has been repeatedly stated,
there is no dispute that Meijer’s workplace rules prohibited harassment but also
provided no definition of what was considered harassment under the rule. Under a
workplace rule with no further guidance on what conduct constitutes harassment—
particularly one indicating that a private conversation could lead to harassment—
Wozniak would have had no reason to believe that her brief, private conversation
with two co-workers would qualify as harassment. Considering the second
workplace rule provided by Meijer—that rule cites violent conduct, of which, as
noted, Wozniak’s conduct is not. Thus, there is no evidence that Wozniak had a
reason to believe that she was violating a requirement of her employer in having a
brief, private conversation with her co-workers.

7
No. 2020AP2002(D)

¶44 In sum, I would conclude that Wozniak was not discharged for
misconduct or substantial fault within the meaning of WIS. STAT. § 108.04(5) or
(5g), and I would uphold LIRC’s decision to award benefits to Wozniak.
Accordingly, I respectfully dissent.

8