Ann R. Majerus, Relator,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2016).

STATE OF MINNESOTA
IN COURT OF APPEALS
A17-0291

Ann R. Majerus,
Relator,

vs.

Spartannash Associates, LLC,
Respondent,

Department of Employment and Economic Development,
Respondent.

Filed December 11, 2017
Affirmed
Larkin, Judge

Department of Employment and Economic Development
File No. 34996674-3

Jessica G. Alm, Thomas H. Boyd, John N. Sellner, Winthrop & Weinstine, P.A.,
Minneapolis, Minnesota (for relator)

David M. Wilk, Larson King, LLP, St. Paul, Minnesota (for respondent)

Lee B. Nelson, Minnesota Department of Employmen t and Economic Development,
St. Paul, Minnesota (for respondent department)

Considered and decided by Larkin, Presiding Judge; Hooten, Judge; and Smith,
Tracy M., Judge.
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U N P U B L I S H E D O P I N I O N
LARKIN, Judge
Relator challenges an unemployment -law judge’s (ULJ) determination that she is
ineligible for unemployment benefits because she quit her employment. Relator argues
that respondent D epartment of Employment and Economic Development (DEED) is
collaterally estopped from denying her benefits because it previously determined that she
was eligible for benefits. Relator also argues that she quit for a good reason caused by her
employer. We affirm.
FACTS
Relator Ann Majerus challenges a ULJ’s determination that she is ineligible for
unemployment benefits. The factual record was developed at an evidentiary hearing before
the ULJ. It establishes that relator began employment with Spartannash Associates, LLC,
d/b/a Econo Foods (“SpartanNash”) on June 25, 2015, as a panner in the bakery. Majerus
was hired to work part time. SpartanNash informed Majerus that she could work up to 30
hours per week, but it did not guarantee her any particular number of hours. Instead,
SpartanNash informed Majerus the number of available hours would depend on sales.
Majerus worked an average of 28.2 hours per week during her 11 w eeks of employment
with SpartanNash. Majerus’s weekly hours varied during her employment, ranging from
a low of 21.04 hours per week to a high of 37.20 hours per week.
On September 17, the bakery supervisor told Majerus that s he was only scheduled
to work ten hours for the upcoming week. Later that day, Majerus approached the store’ s
director, Jeff Kes, and explained that she wanted more hours in either the deli or another
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department in the grocery store. Although the parties agree that this conversation took
place, they disagree regarding Kes’s response to Majerus’s request for add itional hours.
Majerus testified that Kes said “I can’t do that,” whereas Kes testified that he said, “I can’t
do that for next week, the schedules are done.” The parties agree that when Majerus was
hired, there was an understanding that she could pick u p more hours in other departments
of the store.
Two days later, Majerus attempted to locate Kes to see if she could convince him to
give her more hours. Kes was not at the store, but Majerus spoke to the store’s assistant
manager who suggested that she write a letter explaining her grievances regarding the
reduction in her hours and her desire to work in other departments in the store. Although
the letter was not entirely clear regarding whether Majerus was resigning, both Majerus
and Kes understood the letter to be Majerus’s resignation letter.
Majerus applied for unemployment benefits, and DEED issued a determination of
eligibility in October 2015. SpartanNash did not challenge the determination of eligibility,
and Majerus received unemployment be nefits during the following year. We now know
that DEED failed to notify SpartanN ash of the eligibility determination. Instead of
providing notice to SpartanNash, DEED provided notice to a company that was ultimately
acquired by SpartanNash, but that had not been in existence since 2011.
In October 2016, Majerus reapplied for unemployment benefits , but this time,
DEED issued a determination of ineligibility. Majerus appealed this determination , and
her appeal was heard by a ULJ. On November 14, the UL J denied Majerus’ s second
application for unemployment benefits and found that an overpayment of $3,036 resulted
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from the October 2015 eligibility determination. The ULJ determined that “Majerus quit
[her] employment because her hours were reduced,” which was not good cause to quit
because “Majerus was hired for a casual, part -time position, and she was not guaranteed
any number of work hours.”
The ULJ denied Majerus’ s request for reconsideration and affirmed her decision.
This certiorari appeal follows.
D E C I S I O N
Majerus challenges the ULJ’s determination that she is ineligible for unemployment
benefits.1 This court may modify, reverse, or remand a ULJ’s decision if the substantial
rights of the relator were prejudiced because the findings or decision were affected by an
error of law or “unsupported by substantial evidence.” Minn. Stat. § 268.105, subd. 7(d)
(Supp. 2017).
I.
Majerus asserts, for the first time on appeal, that DEED should be collaterall y
estopped from determining that she is ineligible for unemployment benefits, based on its
prior eligibility determination. This court generally will not consider issues that were not
presented to the ULJ. See Peterson v. Ne. Bank – Mpls., 805 N.W.2d 878, 883 (Minn. App.
2011) (“[if] the issue was not raised before the ULJ, [then] it is not properly before this
court”). DEED opposes consideration of the collateral-estoppel issue for this reason. And
SpartanNash argues the factual record is inadequate to determine the issue. We agree that

1 Majerus does not separately challenge the ULJ’s overpayment determination.
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the collateral-estoppel issue is not properly before this court and that the factual record is
not adequately developed regarding this issue. We nevertheless address the issue briefly,
only because we question whether the doctrine of collateral estoppel can ever apply to an
initial eligibility determination.
The following factors must be met for collateral estoppel to apply to an agency
decision:
(1) the issue to be precluded must be identical to the issue
raised in the prior agency adjudication; (2) the issue must have
been necessary to the agency adjudication and properly before
the agency; (3) the agency determination must be a final
adjudication subject to judicial review; (4) the estopped party
was a party or in privity with a party to the prior agency
determination; (5) the estopped party was given a full and fair
opportunity to be heard on the adjudicated issue.

Graham v. Special Sch. Dist. No. 1, 472 N.W.2d 114, 116 (Minn. 1991) (emphasis added)
(citations omitted). The party assert ing collateral estoppel must est ablish each of these
elements. Id. We question whether Majerus can meet this burden because DEED’s initial
eligibility determination was not a “final adjudication subject to judicial review.”
For an unemployment -benefits determination to be “subject to judicial review ,”
several things must occur. First, an employee must apply for unemployment benefits .
Minn. Stat. § 268.101, subd. 1(a) (2016). Second, DEED must make an initial eligibility
determination. Id., subd. 2 (Supp. 2017). Third, if the initial determination is challenged
by either the employer or employee, a hearing must be held before a ULJ . Minn. Stat.
§ 268.105, subd. 1(a) (2016). Fourth, any party that wishes to challenge the ULJ’s decision
from the hearing must request reconsideration of the decision. Id., subd. 2 (Supp. 2017).
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After all these steps are taken, “[t]he Minnesota Court of Appeals must, by writ of certiorari
to the department, review t he [ULJ’s] decision on reconsideration.” Id., subd. 7 (Supp.
2017).
In sum, judicial review is only available for a ULJ’s decision on reconsideration ,
and not for an initial eligibility determination. Because an initial eligibility determination
is not a “final adjudication subject to judicial review,” it would seem that collateral estoppel
does not apply to an initial eligibility determination as a matter of law. However, we leave
a determination regarding this legal issue for another day, when the issue is properly before
us.
II.
Majerus contends that the ULJ erred by determining that she is ineligible for
unemployment benefits because she quit her employment. An employee who quits
employment is generally not eligible for unemployment benefits. Minn. Stat. § 268.095,
subd. 1 ( Supp. 2017). But there are exceptions to this rule and, as is relevant here, an
employee may be eligible if the employee quit because of a “good reason caused by the
employer.” Id. A good reason caused by the employer is defined as a reason: “(1) that is
directly related to the employment and for which the employer is responsible; (2) that is
adverse to the worker; and (3) that would compel an average, reasona ble worker to quit
and become unemployed rather than remaining in the employment.” Id., subd. 3 (Supp.
2017).
“[W]hether an employee had good reason to quit is a question of law reviewed de
novo.” Peppi v. Phyllis Wheatley Cmty. Ctr. , 614 N.W.2d 750, 75 2 (Minn. App. 2000).
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We review the ULJ’s relevant findings of fact “in the light most favorable to the decision
and will not disturb those findings as long as there is evidence in the record that reasonably
tends to sustain them.” Wilson v. Mortg. Res. Ctr., Inc., 888 N.W.2d 452, 460 (Minn. 2016)
(quotation omitted).
It is undisputed that Majerus quit her employment with Sp artanNash. Majerus
argues that she had good reason to quit because “reducing her hours from 28.2 hours per
week on average to 10 hours per week . . . was both a substantial hour and wage reduction.”
She relies on caselaw holding that a substantial wage or hour reduction can provide good
reason to quit. Specifically , she relies on Thao v. Command Ctr., Inc. , 824 N.W.2d 1
(Minn. App. 2012); Sunstar Foods Inc. v. Uhlendorf , 310 N.W.2d 80 (Minn. 1981) ; Scott
v. Photo Ctr., Inc., 306 Minn. 535, 235 N.W.2d 616 (1975); and Haugen v. Superior Dev.,
Inc., 819 N.W.2d 715 (Minn. App. 2012) . For the reasons that follow, this reliance is
misplaced.
In Thao, the main issue was whether an employee had to complain to her supervisor
about an hour reduction before quitting employment to satisfy the good-cause exception
under Minn. Stat. § 268.095 (2010). 824 N.W.2d at 4. We ultimately held that, because a
drastic reduction of an employee’s hours was not an adverse “condition” of employment
that triggered the requirement to complain to a supervisor, an employee is not required to
complain befo re quitting based on a reduction in hours. Id. at 11. We did not decide
whether Thao had good cause to quit. Id. Instead, we reversed and remanded for a
determination whether the reduction of hours was “ actually adverse to [Thao], and, if so,
whether those actions would have caused an average, reasonable emplo yee to quit rather
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than remain in employment.” Id. In sum, Thao does not support Majerus’s argument that
she suffered a reduction of hours that provided good reason to quit.
In the next two cases on which Majerus relies, the supreme court concluded that
employees had good cause to quit based on reduction s in pay. See Sunstar Foods, 310
N.W.2d at 85; see also S cott, 306 Minn. at 536, 235 N.W.2d at 617. However, in each
case, there was a reduction of wages to which the employer had originally agreed.
Specifically, in Sunstar Foods, the employer unilaterally adopted a new labor contract for
its unionized employees that reduced their wages by $2.23 per hour, resulting in a 21-26%
pay reduction. 310 N.W.2d at 82. Similarly, in Scott, the employer changed an employee’s
compensation structure from a fixed salary to a commission -based wage -determination
method, which the commissioner of employment services found would have resulted in a
25% wage cut. 306 Minn. at 535, 235 N.W.2d at 616.
The circumstances here are not comparable to those in Sunstar Foods and Scott.
SpartanNash did not reduce Majerus’s wages. Moreover, SpartanNash told Majerus, at the
time of hiring, that it would provide her with up to 30 hours of employment per week,
without specifying a minimum number of hours. At oral argument before this court,
counsel for Majerus agreed that SpartanNash did not promise her a particular number of
weekly hours. Majerus argues t hat it does not matter t hat SpartanNash did not breach a
contractual obligation or b reak a promise, because SpartanN ash provided her an average
of 28 hours per week and then reduced her hours to ten hours.
Majerus seems to rely on Haugen as support for her argument . Haugen was hired
to work 28 hours per week to manage 16 rental houses. Haugen, 819 N.W.2d at 717.
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“Almost immediately,” Haugen’s employer made him responsible for an additional 18-unit
apartment building, which necessitated that his hours increase to 40 hours per week . Id.
Haugen worked 40 hours per week for over two years. Id. His employer then reduced his
hours, first to 32 hours per week and then to 24 hours per week. Id. In concluding that the
reduction from 40 to 24 was “substantial enough to constitute a good reason to quit,” we
rejected the emp loyer’s argument that “the reduction to 24 hours was not substantial
because Haugen was originally hired on a part -time basis at 28 hours.” Id. at 723. We
reasoned that b ecause Haugen’s duties had been increased and he worked “40 hours pe r
week for more than two years, . . . [t]he ULJ appropriately refused to measure the
significance of the reduction of the original 28-hour arrangement.” Id.
Haugen is distinguishable. SpartanNash never increased Majerus’s responsibilities,
necessitating an increase in her weekly hours . Moreover, Majerus’s weekly hours were
consistent with the number of hours SpartanNash told her she would receive when it hired
her. And Majerus left her employment after only 11 weeks. Unlike the circumstances in
Haugen, Majerus’ s responsibilities, hours, and resulting pay never changed from the
beginning to the end of her employment. Moreover, Ma jerus’s 11 weeks of part-time
employment with SpartanNash is not comparable to the two years of full-time employment
in Haugen.
In sum, although the caselaw on which Ma jerus relies held that substantial
reductions in hours and wages provided good reasons to quit, those reasons resulted from
a reduction in the hours or wages that each employee reasonably expected. The situation
here is not comparable. SpartanNash hired Majerus to work up to 30 hours per week and
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did not promise her any particular number of hours. Majerus could not have reasonably
developed an expectation of a guaranteed number of weekly hours after only 11 weeks of
employment. These circumstances do not establish a reduction in hours or wages that
constitutes good cause to quit under the caselaw discussed above.
We also conclude that the hour reduction for the week of September 22 would not
cause an “average, reasonable w orker to quit and become unemployed rather than
remaining in the employment.” Minn. Stat. § 268.095, subd. 3(3). The reasonable-person
standard considers the conduct of an ordinary, prudent person, and it is an objective
standard. Werner v. Med. Prof’ls LLC, 782 N.W.2d 840, 843 (Minn. App. 2010). An
average, reasonable person who agreed to accept a part -time job providing up to 30 hours
of employment per week, knowing that the number of weekly hours w as not guaranteed,
would not be compelled to quit the first time she received less hours than she would have
liked. We have no doubt that the reduction of hours caused a financial hardship for
Majerus. And we appreciate Majerus’s desire to work more hours. But we cannot conclude
that a reasonable person would have quit her job and become unemployed the first time her
weekly hours were less than she desired when her employer never guaranteed a particular
number of hours in the first place.
Because Majerus did not quit her employment based on a good reason caused by
SpartanNash, we affirm the ULJ’s ineligibility determination.
Affirmed.