As an employer, a Florida association may determine that it is necessary to fire an employee. The employee may not be performing the job for which he or she was hired. Even though the association had a valid business justification to fire an employee, the employee may still be entitled to collect unemployment compensation. Two recent Florida appellate decisions discussed the general rule that regardless of justification for firing, unless a Florida employer fires an employee for "misconduct," the employee will be entitled to unemployment compensation.

In Forte v. Florida Unemployment Appeals, 30 Fla. L. Weekly D922 (Fla. 3^rd DCA, April 6, 2005), an employee was fired as a security guard after she refused to work on Christmas or the following day. The employee was initially denied unemployment benefits on the basis she was fired for misconduct related to her work.

The Florida appellate court reversed the denial of unemployment benefits. The court explained that under §443.101(1)(a), Florida Statutes, an employee is disqualified from receiving unemployment benefits if he or she has been fired for misconduct connected with his or her work. The statute defines "misconduct" as follows:

(a) Conduct demonstrating willful or wanton disregard of an employer’s interests and found to be a deliberate violation or disregard of the standards of behavior which the employer has a right to expect of his or her employee; or

(b) Carelessness or negligence to a degree or recurrence that manifests culpability, wrongful intent, or evil design or shows an intentional and substantial disregard of the employer’s interests or of the employee’s duties and obligation to his or her employer.

The court pointed out that an isolated incident of poor judgment should not constitute misconduct, even if the employer was justified in firing the employee.

The court continued, explaining that excessive unauthorized absenteeism would disqualify the employee from benefits. A single absence would not constitute misconduct. Here, the employee was fired for one unauthorized absence. "Her unauthorized absence was an isolated incident of poor judgment which did not rise to the level of misconduct within the meaning of the statute," the court ruled. While the employer was justified in firing the employee because she refused to work on the days she was scheduled to work, termination of employment is a separate issue from disqualification from unemployment benefits.

In a similar case, a Florida appellate court also ruled that the failure to follow rules and policies is not misconduct under the unemployment statute. In Rosas v. Remington Hospitality, Inc., 30 Fla. L. Weekly D874 (Fla. 3^rd DCA, March 30, 2005), the claimant was employed as the chief engineer of a hotel. After the hotel discovered $196 in cash was missing, the human resources manager asked the chief engineer to come to the office to discuss the missing cash.

The chief engineer refused to go to the office to answer any questions. The hotel fired the chief engineer for insubordination and refusal to cooperate with the investigation. The chief engineer was initially denied unemployment benefits on the grounds the hotel fired him for misconduct related to his work.

As in the first case discussed above, the Florida appellate court reversed the initial denial of unemployment benefits. The court pointed out that the chief engineer’s refusal to answer questions in the investigation of the missing cash was an isolated incident that did not amount to misconduct. "An isolated incident, such as an employee’s failure to follow policies and rules, is generally not considered misconduct, and an employer’s grounds for terminating employment is a separate issue from the disqualification criteria set out in the unemployment compensation statute," the court stated.

Both decisions emphasize the point that an isolated incident, whether it is for missing work or for insubordination, does not amount to misconduct under the unemployment statute. This does not mean the employer cannot fire the employee or is not justified in firing the employee. The decisions only mean that pursuant to the statute, an employee otherwise justifiably fired may be entitled to unemployment benefits.

BANKRUPTCY: SWEEPING NEW CHANGES

After many years of trying, the United States Congress recently passed a bankruptcy law which will significantly affect many, including community associations. The following highlights a few of the changes.

The value of a homestead acquired by a debtor within three years before filing bankruptcy is generally limited to $125,000.

If a Chapter 13 consumer reorganization proceeding is dismissed or converted without completion of the plan, the holder of a secured claim shall retain the lien until payment or discharge of all debts.

A bankruptcy court can grant two-year relief from the automatic stay if the court finds that filing the bankruptcy petition was part of a scheme to delay, hinder, and defraud creditors.

After a Chapter 7 liquidation proceeding, a debtor whose debts were discharged must now wait eight years to file a new petition.

A debtor filing under either Chapter 7 liquidation or Chapter 13 consumer reorganization must complete an educational course addressing personal financial management.

These laws may make it easier for associations to collect debts against delinquent owners. Please contact your attorney with any specific bankruptcy questions.

he Chautauqua Institute has once again invited Michael Gelfand to lecture in July on community association issues.

8 2005 by Gelfand & Arpe, P.A..