Matter of Claim of Kevin T. Walsh, 87 N.Y.2d 69 (1995)

Labor Law § 511 (17) excludes services performed by students in cooperative education programs from unemployment compensation eligibility if the program combines academic instruction with work experience, is an integral part of the student’s full-time program taken for credit, and the educational institution certifies the program, irrespective of whether academic credit is directly awarded for the work experience itself or if participation is mandatory.

Summary

The New York Court of Appeals addressed whether a student who returned to college after working in a cooperative education program was eligible for unemployment benefits. The claimant, a full-time engineering student at Clarkson University, participated in a Semester in Industry Program with General Motors. After his work period, he returned to school full-time. The Unemployment Insurance Appeal Board initially granted him benefits, but the Appellate Division reversed. The Court of Appeals affirmed the Appellate Division, holding that Labor Law § 511 (17) excludes such cooperative education programs from covered employment, even if the student doesn’t receive direct academic credit for the work experience and participation isn’t mandatory.

Facts

Kevin Walsh was a full-time engineering student at Clarkson University. He enrolled in Clarkson’s Semester in Industry Program and was accepted to work at General Motors’ Delco Chassis Division. He signed agreements to work from January to August 1992, after which he returned to Clarkson as a full-time student. Upon leaving General Motors, he indicated on an exit form that he was returning to school. He applied for and initially received unemployment benefits.

Procedural History

An Administrative Law Judge (ALJ) initially found Walsh ineligible for unemployment benefits under Labor Law § 511 (17). The Unemployment Insurance Appeal Board reversed the ALJ’s decision, concluding the work was not part of the school’s curriculum, but was primarily for future employment enhancement. The Appellate Division reversed the Board, finding the statute and legislative intent precluded compensation. Walsh appealed to the New York Court of Appeals.

Issue(s)

1. Whether the term “taken for credit” in Labor Law § 511 (17) requires that the student receive academic credit specifically for the cooperative education work experience.
2. Whether Labor Law § 511 (17) implicitly requires the cooperative program to be a mandatory part of the curriculum for the exclusion from covered employment to apply.

Holding

1. No, because the term “taken for credit” modifies the student’s full-time program, not the work experience itself.
2. No, because the statute does not contain any explicit requirement that the work-study program be a mandatory component of the student’s coursework.

Court’s Reasoning

The court determined that statutory interpretation was required, and the plain language of Labor Law § 511 (17) controls the outcome. It stated that the phrase “taken for credit” modifies the full-time program of study, not the cooperative work experience. The court also found no requirement in the statute that the cooperative program be mandatory. The court cited Matter of Gruber [New York City Dept. of Personnel], 89 NY2d 225, 231 and Kurcsics v Merchants Mut. Ins. Co., 49 NY2d 451, 459 in support of its holding that agency deference is not warranted when the matter involves statutory interpretation without agency expertise. The court emphasized the legislative intent to align New York law with federal law, which precluded unemployment compensation in similar situations. The court further reasoned that awarding benefits would contradict the principle that unemployment insurance is intended for those involuntarily unemployed through no fault of their own (Labor Law § 501). Walsh voluntarily left his employment to return to school. The court also highlighted the policy consideration that imposing unemployment insurance liability on employers participating in cooperative education programs would discourage business involvement, stating, “to conclude that the respondent is responsible for unemployment insurance benefits not only would be counter to the plain words of Labor Law § 511 (17) but also would jeopardize business involvement in programs such as this one because of the potential for unemployment insurance liability.”