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Minnesota Employee Terminated for Moonlighting Found Ineligible for Unemployment Compensation

April 2013

By: James B. Sherman, Esq.

The Minnesota Court of Appeals recently upheld an Unemployment Law Judge's (ULJ) determination that an employee who was terminated for moonlighting was ineligible for unemployment compensation benefits. The court, in Spalla v. Peterson Mechanical, Inc., determined that Mr. Spalla's threat to quit when confronted by his boss about working a second job outside his full time employment amounted to misconduct.

Employment misconduct for purposes of eligibility for unemployment compensation benefits under Minnesota law means "any intentional, negligent, or indifferent conduct, on the job or off the job that displays clearly: (1) a serious violation of the standards of behavior the employer has the right to reasonably expect of the employee; or (2) a substantial lack of concern for the employment." The ULJ in this case determined that the employee exhibited "a substantial lack of concern for [his] employment." In upholding the decision on appeal the court noted that during his hearing Mr. Spalla admitted he knew moonlighting was "not acceptable" to his employer yet he chose to perform the outside work.

It is notable that in this case the employer lacked any formal policy against moonlighting. The outcome of this case may have been different had the employee not admitted he knew what he was doing was wrong. Of course written policies can help win unemployment compensation hearings. But when an employer lacks a written policy to cover a particular type of misconduct this can be overcome by solid written disciplinary documentation or, as this case demonstrates, an effective cross examination of the claimant at hearing.

To assess your chances of prevailing at hearing on a claim for unemployment compensation, or for cost effective representation at such a hearing, contact Wessels Sherman attorneys James B. Sherman or Phoebe A. Taurick at (952) 746-1700.