Paratransit, Inc. v. UIAB: Employee's Refusal to Sign Disciplinary Notice Constitutes Insubordination, but not Grounds to Deny Unemployment Benefits

In Paratransit, Inc. v. Unemployment Insurance Appeals Board (Medeiros) (2012) 206 Cal.App.4th 1319, the Court of Appeal held that an employee's refusal to sign a disciplinary memorandum in connection with a prior incident of misconduct constituted work-related misconduct, not a good-faith error in judgment, rendering the employee ineligible for unemployment compensation.

On July 3, 2014, the California Supreme Court disagreed. Paratransit, Inc. v. Unemployment Insurance Appeals Board (Medeiros) (7/3/14) --- Cal.4th ---. The Court held as follows:

In this case, an employee refused his employer's repeated orders to sign a written disciplinary notice, because he disputed the notice's factual allegations and thought he was entitled to consult with his union representative first. There is no dispute over whether the employer was within its rights to fire the employee for his insubordination. The only question is whether that single act of disobedience constituted misconduct within the meaning of California's Unemployment Insurance Code. If so, then the employee is disqualified from receiving unemployment compensation benefits. 

Based on the undisputed facts in the administrative record, we conclude the employee's refusal to sign the disciplinary notice was not misconduct but was, at most, a good faith error in judgment that does not disqualify him from unemployment benefits.

The opinion is available here.