19. Federal Court Decisions & TRA

LARA v. Khan – 19.16

LARA v. Khan
Digest No. 19.16

Trade Act of 1974 (19 USC 2319(2))

Cite as: LARA v Khan, 311 Mich App 66 (2015).

Appeal pending: No
Claimant: Khan
Employer: Technicolor
Date of decision: June 11, 2015

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HOLDING: Requests to waive the training required to receive TRA unemployment benefits are not subject to the deadline applicable to enrollments in training.

FACTS: On October 22, 2009, Claimant and his co-workers at Technicolor were certified for eligibility for Trade Readjustment Allowance (“TRA”) unemployment benefits. Claimant separated from Technicolor on January 4, 2010 due to lack of work. On March 24, 2010, Claimant signed a document acknowledging that, to obtain TRA benefits, he had 26 weeks from the date of his separation to enroll in classroom training, or to contact a Michigan Works! office to request a waiver from training. After the 26 week period had expired, Claimant requested, and was granted, an untimely waiver from training on September 7, 2011.

The TRA program is a federal program established by the Trade Act of 1974. The Michigan Unemployment Insurance Agency (“UIA”) administers the TRA program utilizing federal funds. Because Claimant failed to comply with the 26 week deadline, UIA exercised its authority and denied Claimant’s request for TRA benefits. An ALJ reversed the UIA’s determination and found Claimant eligible for TRA benefits. The Michigan Compensation Appellate Commission (“MCAC”) affirmed the ALJ’s decision. UIA appealed.

DECISION: The Court of Appeals affirmed MCAC’s decision, Claimant is eligible for TRA benefits.  

RATIONALE: In 2009, Congress amended the Trade Act of 1974 to change the deadline for enrolling in training under 19 USC 2291(a)(5)(A)(ii) to 26 weeks after separation. Congress did not amend or include a deadline for, 19 USC 2291(a)(5)(C), the statutory provision dealing with a waiver from training.

In a 2004 guidance letter, (Trade Adjustment Assistance Program, Training and Employment Guidance Letter No 11-02, Change 1, 69 Fed Reg 60903 (October 13, 2004)) the United States Department of Labor announced that the deadlines for training extended to waivers. Interpreting the 2002 versions of the aforementioned statutes, the Court of Appeals refused to defer to this guidance letter in Dep’t of Labor & Economic Growth v Dykstra, 283 Mich App 212, 215 (2009). The Dykstra Court argued that the letter conflicted with the intent of Congress to not impose deadlines on waivers as evident through the text of 19 USC 2291(a)(5)(C), which omits deadlines entirely.

Here, the question that the Court faced was whether the 26 week deadline in the 2009 version of 19 USC 2291(a)(5)(A)(ii) also applied to individuals seeking waiver. The Court refused to extend the deadline to waivers for two reasons.

First, the statutory waiver provision at 19 USC 2291(a)(5)(C) of the Trade Act of 1974 does not mention deadlines. Thus, the clear intent of Congress must have been to restrict the deadlines only to the training provision at 19 USC 2291(a)(5)(A)(ii), which explicitly mentions deadlines.

Second, when Congress revised the Trade Act of 1974 in 2009, it was aware of the Dykstra decision that refused to extend the training deadlines to the waiver provision. If Congress sought to overturn Dykstra, it could have amended the text of 19 USC 2291(a)(5)(C) in 2009 to include waiver deadlines. Because it did not, it must be that the training deadlines in 19 USC 2291(a)(5)(A)(ii) do not extend to the waiver provision at 19 USC 2291(a)(5)(C).

Since there isn’t deadline to obtain a waiver, Claimant is eligible for TRA benefits.

Digest author: Sean Higgins, Michigan Law, Class of 2017
Digest updated: November 1, 2017


14. Disqualifications - Other 16. Procedures/Appeals 19. Federal Court Decisions & TRA

UIA v Varga – 19.12

UIA v Varga
Digest No. 19.12

19 USC § 2291(a)(5)

Cite as: Unemployment Insurance Agency v Redlin, unpublished opinion of the Jackson County Circuit Court, issued March 20, 2006 (Docket No. 182823).

Appeal pending: No
Claimant:  Peter Varga
Employer: N/A
Date of decision: March 20, 2006

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HOLDING: The application of agency by estoppel to the Agency is contrary to U.S. Supreme Court precedent.

FACTS: Claimant filed for Trade Readjustment Allowance (TRA) benefits. All claimants who file for benefits are referred to Michigan Works!, Michigan Works! is changed with processing both training authorizations and waivers. Here, Claimant acted on faulty advice of a Michigan Works! Employee and was determined to be ineligible for benefits by the Agency for non-compliance with 19 USC § 2291(a)(5). The Administrative Law Judge reversed the Agency’s determination and found the Claimant eligible for TRA benefits. The Michigan Employment Security Board of Review affirmed this decision on a theory of agency by estoppel. The Board of Review reasoned that since the Agency’s Fact Sheets refer claimants to Michigan Works! and since a claimant, with no knowledge of the “system”, should not be expected to know that an employee of the Agency “acted beyond the scope of his authority”, the ALJ properly found the employee was the Agency’s agent by estoppel.

DECISION: The holding of the Michigan Employment Security Board of Review is affirmed in part and reversed in part. Claimant is entitled to TRA benefits and the Board of Review’s application of estoppel to the Agency is reversed.

RATIONALE: The Board of Review reached the correct conclusion regarding eligibility for benefits but for the wrong reasons. Claimant received a waiver and therefore met the eligibility requirements of 19 USC § 2291(a)(5)(C) which does not contain the deadlines in 19 USC § 2291(a)(5)(A). As a result, Claimant is eligible for TRA benefits. However, the portion of the Board of Review’s reliance on the theory of estoppel was contrary to law as it is inconsistent with U.S. Supreme Court precedent.  

Digest author: Cydney Warburton, Michigan Law, Class of 2017
Digest updated: 11/19/2017