1. "Good Reason" caused by the employer
   A good reason for quitting caused by the employer is a reason: (1) that is directly related to the employment and for which the employer is responsible; and (2) that is significant and would compel an average, reasonable worker to quit and become unemployed rather than remaining in the employment. When an employee claims that he has quit his employment for "good reason," the employee must show that the reason for quitting is "compelling, real and not imaginary, substantial and not trifling, reasonable and not whimsical and capricious." Shanahan v. Dist. Memorial Hosp. , 495 N.W.2d 894 (Minn. Ct. App. 1993).
   
   The statute lists several categories of "good reasons" caused by the employer. These include:
   
   
   • Uncorrected, adverse working conditions
     An employee who quits rather than exposing himself to unsafe working conditions may be eligible for unemployment compensation. Employers owe a duty to their employees to provide a safe place to work. An employee whose safety concerns are reasonably based on facts (whether the employee ultimately is correct or not) may be eligible. The employee must, however, complain to the employer and give the employer an opportunity to correct the adverse working condition before quitting.
     
     
   • Substantial adverse change in wages, hours or other terms of employment
     Unless the change is disciplinary in nature for the employee's misconduct, an employee who quits rather than accepting a substantial change in pay or hours or other terms of employment will be eligible for unemployment compensation.
     
     A substantial change in the terms of employment generally is found when an employer breaches the employment agreement. The agreement need not be formal, and can be written or oral. Hayes v. K-Mart Corp. 665 N.W.2d 550 (Minn. Ct. App. 2003). Failing to grant a promised pay raise falls into this category. Id. A demotion (other than for misconduct) that results in lower pay and less desirable hours also falls into this category. Rootes v. Wal-Mart, 669 N.W.2d 416 (Minn. Ct. App. 2003). Similarly, when an employee is hired to work specific hours and, once hired, is expected to work different hours, constitutes a good reason to quit. Krantz v. Loxtercamp Transport Inc., 410 N.W.2d 24 (Minn. Ct. App. 1987). A new policy eliminating the availability of overtime, which reduced an employee's average earnings by 19%, has been found to be a good reason to quit. Danielson Mobil, Inc. v. Johnson, 394 N.W.2d 251 (Minn. Ct. App. 1986).
     
     Such changes in the terms of employment are not limited to wage and hour issues. A change in the overall "stature" or responsibilities of the position also can justify quitting for purposes of unemployment compensation. For example, an employer eliminated an employee's full time position as a museum curator and moved an employee into two "part time" secretarial positions. The employee's salary remained the same. The court held that the employee quit for good cause because she would have not had the same room for advancement, was overqualified for the secretarial position, and because the employer did not inform the employee that the transfer would be only temporary. Holbrook v. Minn. Museum of Art, 405 N.W.2d 537 (Minn. Ct. App. 1987). Generally, a substantial loss of opportunity for promotion and monetary advancement will be found to be a good reason to quit, without disqualification from unemployment benefits. Marty v. Digital Equip. Corp. , 345 N.W.2d 773 (Minn. 1984).
     
     Violations of wage laws also have been found to constitute a good reason to quit caused by the employer. The employer's deductions from an employee's paycheck for shortages or other losses without the employee's consent justified the quit in Knutson v. DJM Transport Inc., 413 N.W.2d 598 (Minn. St. App. 1987). The employer's violation of the minimum wage laws constituted good reason to quit in Miller v. International Exp. Corp. , 495 N.W.2d 616 (Minn. Ct. App. 1993).
   
   
   NOTE:
   In order for an employee to have "good reason" to quit because of a change in terms and conditions of employment, the change should be substantial. Simply requiring an employee to perform certain tasks differently, hang coats in different areas or cut down on personal phone calls does not constitute a substantial change in the terms of employment. While there is no bright line test, the change must be substantial enough that a reasonable person would quit rather than endure the changes.
   
   
   • Unremedied sexual harassment.
     An applicant has a good reason caused by the employer for quitting if it results from sexual harassment of which the employer was aware, or should have been aware, and the employer failed to take timely and appropriate action. Sexual harassment, and the employer's duties in response to a complaint, are covered in detail elsewhere in these materials. A failure to properly respond to a complaint, for the purposes of this discussion, add unemployment compensation liability to the victim's other remedies.
     
     If an employee informs the employer of harassment, and the employer does nothing about it, the employee has good cause to quit. Hanke v. Safari Hair Adventure, 512 N.W.2d 614 (Minn. Ct. App. 1994). The harassment can come from either supervisory personnel or coworkers. Tru – Stone Corp. Gutzkow, 400 N.W. 2d 836 (Minn. St. App. 1987). When an employee complains to her supervisor that she is being sexually harassed, and the employer defers the decision to investigate the harassment to the employee, the employee has good reason to quit. Peppi v. Phyllis Wheatley Comm. Ctr. , 614 N.W.2d 750 (Minn. Ct. App. 2000). Similarly, if an employee reports harassment and the employer does not give the employee any expectation that the claim will be investigated, the employee has good reason to quit. Hanke v. Safari Hair Adventure, 512 N.W.2d 614 (Minn. Ct. App. 1994). In Hanke, an openly gay employee told his employer that he was being harassed because of his sexual orientation. Id. The employee reported that his manager told him that she did "not want a bunch of fags" working there and also told the employee that he should get married to a woman. Id. It was held that the employee quit for "good reason" when the employer told the employee that he "could not control the opinions of what other people feel or think." Id. The court also held that harassment based on an employee's sexual orientation creates good cause to quit if: 1) the harassment creates a hostile work environment, 2) is brought to the attention of the employer, and 3) the employer fails to take action to remedy the harassment in a timely manner. Id.
   
   
   
2. Unsuitability of Position
   Another category of "good reasons" to quit do not depend on whether the employer is at fault. The statute recognizes three instances where the unemployed person should be eligible for unemployment compensation, despite quitting, because the employment is not suitable.
   
   
   • New Job after being Terminated
     An employee who starts a new job, and discovers that the new job is unsuitable may quit without losing eligibility for unemployment compensation. This scenario occurs when a person who received benefits as a result of termination from a former employer, finds another job, but the new job is unsuitable. If the new employment has not lasted long enough to qualify the person for new unemployment benefits, the person will still be eligible for benefits based on the former employment. In order to remain eligible for benefits from the previous employer, the employee must quit within a reasonable time after starting the new employment.
     
     
     • Quitting unsuitable job in first 30 days
       A person who quits employment within 30 calendar days of beginning the employment because the employment was unsuitable will not be disqualified from unemployment compensation on the basis that the termination was a voluntary quit.
       
     • Quitting unsuitable job to enter reemployment training
       A person will not lose eligibility for unemployment compensation by quitting an unsuitable job in order to enter reemployment assistance training.
     
     
     
   • Notice of a Lay-off within 30 Days
     An employee who quits a job in the face of an imminent lay-off will not lose eligibility for unemployment compensation because of the quit. However, eligibility for the benefits will not begin until the date of the noticed lay-off.
     
     
   • Serious Illness or Injury
     A person who quits due to serious injury or illness will not be disqualified from unemployment compensation if certain conditions are met. The illness or injury must be serious enough to make it medically necessary to quit. Additionally, the employee must first inform the employer of the serious illness or injury and request accommodation. If no reasonable accommodation is made available, then the employee will be eligible for unemployment compensation upon quitting.
     
     If the employee's illness is chemical dependency, this exception will not apply if the employee was previously diagnosed as chemically dependent or had treatment for chemical dependency, and has failed to make consistent efforts to control the chemical dependency.
     
     Again, the reader should be alert to other legal requirements imposed by the American with Disabilities Act if presented with this scenario. A failure to reasonably accommodate a disability can result in much greater liability than mere unemployment compensation.
     
     
   • Domestic Abuse
     If domestic abuse of the employee or the employee's minor child makes it necessary to quit work, unemployment compensation will remain available.
     
     "Domestic abuse" can be shown by one or more of the following:
     
     • A court order for protection or other documentation or equitable relief;
       
     • Police record documenting domestic abuse;
       
     • Documentation that the perpetrator has been convicted of domestic abuse;
       
     • Medical documentation of domestic abuse;
       
     • A written statement from a social worker, member of the clergy, shelter worker, attorney at law, or other professional that has assisted the employee, or employee's minor child, that states that the employee or the employee's minor child is the victim of domestic abuse.

• A discharge from employment occurs when any words or actions by an employer would lead a reasonable employee to believe that the employer will no longer allow the employee to work for the employer in any capacity. A layoff due to lack of work shall be considered a discharge. A suspension from employment without pay of more than 30 calendar days shall be considered a discharge.
  
  
• An employee who gives notice of intention to quit the employment and is not allowed by the employer to work the entire notice period shall be considered discharged from the employment as of the date the employer will no longer allow the employee to work. If the discharge occurs within 30 calendar days prior to the intended date of quitting, then, as of the intended date of quitting, the separation from employment shall be considered a quit.

1. Destruction of personal property
   When an employee intentionally destroys property belonging to other employees or the employer, the employee can be terminated for "misconduct." The court held that it was misconduct for an employee to puncture tires on trucks belonging to the employer. Huling v. Stemm Transfer & Storage, Inc., 411 N.W.2d 246 (Minn. Ct. App. 1987).
   
   
2. Dishonesty
   Dishonesty that is connected with employment may constitute misconduct. Typically, an employee is denied unemployment compensation when the employee misleads the employer in way that disregards the employer's interests. For example, if an employee lies to the employer when the employer is conducting an investigation or if the employee leads an employer to believe that he has completed work, when he has not, such dishonesty is considered misconduct. Conversely, when an employee told her employer that she needed time off for a funeral, and the employer later learned that the employee actually took time off in order to attend a wake, it was found that the employee did not intentionally mislead the employer in a way that disregarded the employer's interests and the employee remained eligible for unemployment compensation. Siticha v. McDonald's No. 291, 346 N.W.2d 18 (Minn. 1984).
   
   
3. Misrepresentation on Employment Application
   In order for a falsified or misleading employment application to be grounds for "misconduct," the false or misleading information must be material to the employee's position. A diagnosed alcoholic's falsification of an employment application to be a chef at a public school, which represented that he had no alcohol problem, was not material to his position so as to justify ineligibility for unemployment benefits upon discharge, where the truth would not have prevented his hiring. Independent School Dist. No. 709 v. Hansen, 412 N.W.2d 320 (Minn. Ct. App. 1987).
   
   For misrepresentations on an employment application to rise to the level of misconduct, the misrepresentations must relate to the employee's qualifications for the specific employment sought. For example, if a man applies for a position as a garbage collector and falsely states on his application that he was once the CEO of a toy company, the employee has not committed "misconduct" because misrepresentation does not relate to his ability to do his job. However, if the same man applies for a position as a surgeon and falsely states that he has gone to medical school, he has committed misconduct.
   
   
4. Abusive Language
   Abusive language will not always provide grounds for denial of unemployment benefits. Typically, abusive language will constitute "misconduct" when the employer has informed an employee that such language is unacceptable and the employee uses such language under circumstances that are adverse to the employer's interests. For example, a nursing assistant's use of profanity in front of nursing home residents, when the nursing assistant had not committed any previous misconduct, when the nursing assistant had been ill, and when the assistant's workload had significantly increased, was not misconduct when the profanity was directed at the employee's supervisor and not nursing home residents. Mankato Lutheran Home v. Miller, 358 N.W.2d 96 (Minn. Ct. App. 1984). However, when a nurse used profanity, on several occasions, with a nursing home resident, such conduct constituted misconduct. Ideker v. LaCrescent Nursing Center, Inc., 207 N.W.2d 713 (Minn. 1973).
   
   
5. Conflict of Interest
   It has been held that when an employer clearly communicates its standards or expectations to its employees concerning loyalty and conflict of interest, the employer can terminate the employee for misconduct for engaging in behavior that violates those expectations. An employee who merely threatens to quit and start a competing business against the employer, however, is not committing "misconduct." Hanson v. C. W.
   Mears Inc., 486 N.W.2d 776 (Minn. Ct. App. 1992).
   
   
6. Absenteeism
   Whether there is a single absence or an excessive number of absences, there must also be evidence of a lack of concern by the employee sufficient to constitute "misconduct" to disqualify the employee from receiving unemployment compensation benefits. With that shown, even a single absence can constitute misconduct. An employee's repeated tardiness, despite warnings from an employer, constitutes misconduct.
   
   Whether such absences constitute misconduct depends on the circumstances. Courts have recognized that there are instances when a well-timed absence may be extremely detrimental to the interests of the employer. For example, an employee's failure to show up for work, without reasonable justification, on the day he is to make a major presentation may be misconduct
   
   Failure to report to work because of illness, failure to obtain childcare, family emergencies, or because of other reasonable excuses, does not constitute "misconduct." For example, a mother's frequent absenteeism because of a sick infant, in light of good faith efforts to obtain childcare, was found to not constitute misconduct. McCourtney v. Imprimis Tech. Inc., 465 N.W.2d 721, 724 – 725 (Minn. Ct. App. 1991).
   
   Employers should be alert to the possibility that absenteeism results from an employee's disability. If so, there may be an obligation under the Americans with Disabilities Act to make a reasonable accommodation.
   
   Absence from work due to incarceration is "misconduct."
   
   
7. Drug or Alcohol Use
   An employee's consumption of alcohol on the job constitutes "misconduct."
   
   An employee's absence from work for more than three days without notifying an employer, even though the employee was addicted to alcohol, constituted misconduct. Torgerson v. Goodwill Industries Inc., 391 N.W.2d 35 (Minn. Ct. App. 1986).
   
   If an employer has a policy requiring that employee abstain from drug and alcohol use, even outside of work, an employee's use of drugs and alcohol will constitute misconduct. Hein v. Gresen Div., 552 N.W.2d 41 (Minn. Ct. App. 1996).
   
   
8. Refusal to Work
   The general rule is that if the employer makes reasonable requests of the employee, and does not place unreasonable burdens on the employee, the employee's refusal to abide by those requests constitutes misconduct.
   
   An employee action in leaving work, and remaining away unexcused in an effort to force his employer to give him a written promise of future vacation time was misconduct. Herreid v. Moore Data Management Services, 392 N.W.2d 613.
   
   When an employee refuses to perform work that is outside of the employee's duties, the employee's refusal does not generally constitute misconduct.
   
   
9. Insubordination
   If an employer's expectations of an employee are reasonable, refusal of the employee to abide by those expectations is misconduct. The employee who refuses, without reason, to follow his employer's reasonable requests, is committing misconduct. For example, an employee's refusal to participate in a reasonable employment performance plan was intentional disregard of employment duties that constituted misconduct and disqualified the discharged employee from receiving unemployment compensation benefits.
   
   
10. Falsifying Records
    Falsifying business records constitutes misconduct. Similarly, an employee falsifying a timecard is misconduct.
    
    
11. Fighting
    An employer has a right to expect employees will not physically assault one another, or their supervisors, at work. Hines v. Sheraton Ritz Hotel, 349 N.W.2d 329.
    
    
12. Money Handling
    An employer has a right to expect scrupulous handling of the employer's money. An employee who steals, or acts with extreme carelessness when handling the employer's money, commits "misconduct."
    
    
13. Moonlighting
    An employee only commits "misconduct" in holding a second job when an employer clearly articulates to an employee that holding a second job is prohibited, and such prohibition is reasonable.
    
    
14. Pranks and Horseplay
    As we all know from high school shop class, horseplay can cause injuries, as well as a general loss of productivity. Nevertheless, pranks do not always rise to the level of "misconduct." In one case, an employee who distributed laxative gum to three of his co-workers as a prank was found not have committed misconduct, and remained eligible for unemployment compensation. Engler v. Marshall Turkey Plant, 409 N.W.2d 570 (Minn. Ct. App. 1987). The court reasoned that the conduct, although unsatisfactory, did not rise to the level of intentional disregard for the employer as required for a finding of misconduct.
    
    
15. Hotheaded Incident Rule
    As mentioned in the definition of "misconduct," a single incident that does not have a significant adverse impact on the employer will not be considered misconduct. This phrase from the definition has become known as the "hotheaded incident" rule.
    
    A hotheaded incident is an isolated occurrence of the employee losing his temper at work and doing something regrettable. The rule is limited to single incidents where an employee acts in the heat of the moment rather than making a deliberate, rational decision. An employee can be terminated for a "hotheaded incident." However, if the incident does not have a significant adverse impact on the employer, it is not "misconduct" that will disqualify an employee from receiving unemployment compensation benefits. Shell v. Host Intern, 513 N.W.2d 15 (Minn. Ct. App. 1994).
    
    An employee's behavior, after learning that his employer was dissatisfied with his performance, threw a hammer at his employer's desk, fell outside the hotheaded incident rule, and the employee was disqualified from receiving unemployment compensation, because this behavior interfered with the employer's business. McCoy v. Spicer Off-Highway Axle Div., 412 N.W.2d 24 (Minn. Ct. App. 1987). On the other hand, when an employee threw a crumpled piece of paper at his employer's face, the employee's behavior fell under the "hothead incident rule, and he remained eligible for unemployment compensation because his behavior did not inhibit the employer's ability to perform his business. Norman v. Rosemount Inc., 383 N.W.2d 443 (Minn. Ct. App. 1986). Similarly, an employee who was discharged for throwing a small plastic object at a coworker, pushing the coworker in her chair, and pulling off the coworker's cap qualified for unemployment compensation benefits hotheaded incident rule. Oman v. Daig Corp., 375 N.W.2d 533 (Minn. Ct. App. 1985).

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