Taylor v. Department of Employment & Training

ADKINS, Judge. This case presents the question of whether an involuntarily unemployed worker, ineligible for retirement, who receives a lump sum retirement payment and rolls it over into an individual retirement account (IRA), is eligible for unemployment compensation benefits. Article 95A, § 6(g) of the Unemployment Insurance Law disqualifies claimants who have received an amount equal to or in excess of the weekly ⁴⁷⁰ benefit amount in the form of a retirement payment. The appellant, Carlotta M. Taylor, invites us to qualify her for unemployment compensation benefits under § 6(g) by characterizing her receipt of a lump sum retirement payment as a temporary constructive transfer, accomplished merely for the purpose of continuing a retirement plan prematurely terminated.

We decline this invitation and hold that the disqualifying provisions of § 6(g) appropriately apply to the facts of this case. We explain. The facts are simple and undisputed. Taylor was employed as an accounting manager at Joyce Beverages for nearly twenty years when, at the age of 56, her job was abolished and her employment terminated.

During the time of her employment she had participated in an employer-sponsored profit sharing trust. The profit sharing program was designed as a retirement plan for employees. Upon separation from employment, Joyce Beverages disbursed to Taylor $38,987.11, which represented the entire vested balance of the profit sharing trust. After deducting the amount of her contribution, Taylor immediately rolled over the remaining $34,755.27 into an IRA at the Maryland National Bank, and applied to the appellee, the Department of Employment and Training, for unemployment compensation benefits.

Her application for benefits was subsequently denied on the basis she had received a retirement payment exceeding her weekly benefit amount under § 6(g). After exhausting administrative remedies, Taylor appealed to the Circuit Court for Prince George’s County which affirmed the decision of the Department of Employment and Training. Taylor then made timely appeal to the Court of Special Appeals. Before argument in that court, we granted certiorari on our own motion to consider the important question presented.

The focus of our inquiry is the meaning of the term “received” within the provisions of § 6(g), and it is to these provisions that we now turn. Section 6(g) disqualifies a claimant “for any week ... he is receiving or has received ⁴⁷¹ an amount ... equal to or in excess of his weekly benefit amount in the form of a pension, annuity or retirement or retired pay, or any other similar periodic payment____” The provision also envisions lump sum payments for § 6(g)(3)(ii) provides that “A lump sum payment of a pension, annuity, or retirement or retired pay shall be allocated to a number of weeks following the date of separation according to the number of weeks of pay received at the individual last pay rate.” Taylor concedes that under a plain and ordinary interpretation of § 6(g), she has received a lump sum retirement payment in excess of her calculated weekly benefit amount and is ineligible for benefits. She urges, however, that to effectuate the remedial design of the Unemployment Insurance Law, the court must adopt a restrictive interpretation of the term “received” under § 6(g), and limit its application in this case to involuntarily unemployed individuals who are eligible for retirement. 1 As we have often recognized, Maryland’s Unemployment Insurance Law is designed to alleviate the consequences of involuntary unemployment and ease the burden of economic distress. Board of Educ.

Mont. Co. v. Paynter, 303 Md. 22 , 491 A.2d 1186 (1985); Employ. Sec. Adm. v. Browning-Ferris, 292 Md. 515 , 438 A.2d 1356 (1982); Sec., Dept. Human Resources v. Wilson, 286 Md. 639 , 409 ⁴⁷² A.2d 713 (1979); Saunders v. Unemp.

Comp. Board, 188 Md. 677 , 53 A.2d 579 (1947); Compensation Board v. Albrecht, 183 Md. 87 , 36 A.2d 666 (1944). To accomplish this important purpose, weekly income benefits are paid to individuals who have become involuntarily unemployed through no fault of their own, and who are otherwise eligible. In determining the scope of the statute and the eligibility of claimants, we have held that the provisions of the Unemployment Insurance Law should be liberally construed to effectuate its legislative intent, and any disqualifying provisions in the remedial statute should be strictly construed.

Saunders v. Unemp. Comp. Board, 188 Md. at 681-683 , 53 A.2d at 580-581 . It cannot be denied that a consequence of involuntary unemployment may be the premature termination of a retirement plan.

Indeed, Taylor presents the interesting policy argument that where the receipt of a lump sum retirement payment is characterized as present