Matter of Eric W., 31 N.Y.2d 370 (1972)
A willful, false statement regarding a material fact on an employment application, such as concealing a prior arrest, constitutes misconduct in connection with employment, thereby disqualifying the claimant from receiving unemployment benefits.
Summary
Eric W. was discharged from his position as an audit clerk at a stockbrokerage firm after the firm discovered that he had falsified his employment application by concealing a prior arrest. The Unemployment Insurance Appeal Board sustained the initial determination of the Industrial Commissioner, disqualifying him from receiving unemployment benefits due to misconduct. The New York Court of Appeals affirmed, holding that deliberately concealing a prior arrest on an employment application constitutes misconduct connected to employment, particularly in a position requiring trustworthiness and integrity, such as handling valuable securities. The court emphasized the employer’s legitimate need to assess a prospective employee’s background and the employer’s regulatory obligations related to employee records.
Facts
The claimant, Eric W., applied for a position as an audit clerk at a stockbrokerage firm.
On his employment application, he falsely stated that he had never been arrested.
In fact, he had been arrested one month prior to submitting the application.
Approximately nine months after being hired, the employer discovered the falsification.
Eric W. was subsequently discharged due to the falsified information.
Procedural History
The Industrial Commissioner initially determined that Eric W. was disqualified from receiving unemployment benefits due to misconduct.
The Unemployment Insurance Appeal Board sustained the Commissioner’s determination.
The Appellate Division affirmed the Board’s decision.
Eric W. appealed to the New York Court of Appeals as of right on constitutional grounds.
Issue(s)
Whether the concealment of a prior arrest on an application for employment constitutes “misconduct” in connection with employment within the meaning of the Labor Law, thereby disqualifying the claimant from receiving unemployment benefits.
Holding
Yes, because a willful, false statement as to a material fact on an application for employment, such as concealing a prior arrest, constitutes misconduct in connection with employment under the Labor Law, thereby disqualifying the claimant from receiving unemployment benefits.
Court’s Reasoning
The court reasoned that the term “misconduct” in the context of unemployment benefits includes a willful, false statement about a material fact on an employment application. The court emphasized that employers, particularly in industries dealing with valuable assets, have a legitimate concern in knowing a prospective employee’s background, including any brushes with the law, to assess their character, integrity, and fitness for the position. The court noted that stockbrokerage firms are required to maintain and verify personnel records, including records of arrests, as per federal regulations and New York Stock Exchange rules. The court stated, “Certainly the employer, such as the stockbroker in this case, had a legitimate concern in knowing of a prospective employee’s background, including any brushes with the law, in order to intelligently pass on his character and integrity, as well as his fitness for the position he seeks.” While acknowledging that an arrest alone proves little, the court asserted that the answer regarding prior arrests necessitates further inquiry and investigation. The court concluded that the employer’s interest required the claimant to reveal his arrest record to properly evaluate his integrity and fitness, and failure to do so constituted misconduct under the Unemployment Insurance Law.