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July 09, 2020

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Kentucky Employers Must Be Represented by Counsel in Unemployment Compensation Hearings, Court Rules

Non-lawyers may no longer represent employers in unemployment compensation hearings in Kentucky, the Kentucky Court of Appeals has ruled. Nichols v. Kentucky Unemployment Commission, et al.No. 2017-CA-001156-MR, 2019 Ky. App. LEXIS 73 (Ky Ct. App. Apr. 26, 2019).

The Court held the section of the Kentucky unemployment compensation statute that permits an employer to represent itself and authorizes a non-lawyer managerial representative to represent the corporation in administrative proceedings before the unemployment commission (KRS 341.470(3)) violates the Kentucky Constitution because it constitutes the unauthorized practice of law. Therefore, if an employer is not an individual or sole proprietor, it must be represented by counsel at any hearing or proceeding before the Kentucky Unemployment Commission.

Background

After he was terminated by his employer, Michael Nichols filed for unemployment compensation benefits. The Unemployment Commission originally determined that Nichols was disqualified from benefits. He appealed and an administrative hearing was held before the referee. The employer was represented at the hearing by the manager who had supervised Nichols and terminated his employment. The Commission affirmed the denial of benefits following the hearing. Nichols appealed to the Jefferson Circuit Court, which also affirmed the denial of benefits.

On appeal to the Kentucky Court of Appeals, Nichols argued (among other things) that the proceedings before the Commission were unconstitutional due to the non-attorney manager’s appearance at the hearing.

Statute Unconstitutional

On review, the Court of Appeals explained that the statute, at KRS 341.470(3)(a), expressly authorizes “any employer” to represent itself or be represented by counsel in a proceeding before the referee or Commission. It also explained that KRS 341.470(3)(b) similarly authorizes a managerial representative to represent a corporation or partnership employer in a proceeding before the referee or the Commission.

While an individual employer or sole proprietorship had the right to represent itself in any administrative or legal proceedings, the Court of Appeals held that KRS 341.470(3) was unconstitutional as applied to any other employers because it violates the separation of powers provisions of the Kentucky Constitution by permitting the unauthorized practice of law.

The Court reversed the decision of the Jefferson Circuit Court and remanded the action back to the Commission to hold a new hearing in which the employer was represented by counsel.

The Court decision is prospective only. It will not invalidate decisions resulting from hearings that occurred prior to its issuance.

Implications

The Court’s decision overturns decades of standard practice in Kentucky and will increase employers’ cost to challenge an unemployment claim. Kentucky employers should retain counsel for any future Kentucky unemployment compensation hearings.

Jackson Lewis P.C. © 2020National Law Review, Volume IX, Number 127

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About this Author

Patricia Anderson Pryor, Class Action, Litigator
Principal and Office Litigation Manager

Patricia Anderson Pryor is a Shareholder in the Cincinnati, Ohio office of Jackson Lewis P.C. Ms. Pryor is an experienced litigator in both state and federal courts, representing and defending employers in nearly every form of employment litigation, including class actions.

She represents and advises employers in federal and state administrative proceedings, in all forms of dispute resolution, including mediation and arbitration, and in managing all aspects of the employment relationship. She has represented...

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Katharine Weber, JacksonLewis Law Firm, Labor and Employment Attorney
Principal

Ms. Weber has experience litigating wrongful discharge cases; managing discrimination cases; negotiating collective bargaining agreements; representing employers before the Equal Employment Opportunity Commission and other federal, Ohio and Kentucky agencies; advising management on employment relations; drafting employee handbooks; and negotiating severance agreements.

Ms. Weber regularly advises clients on wage and hour issues. Over the past five years she has served as lead counsel on various wage and hour class and collective actions filed in both Ohio and Kentucky involving claims of misclassification, off the clock work, and other violations for which the plaintiffs claimed to be owed substantial overtime.

Additionally, Ms. Weber is extremely knowledgeable in the area of the Americans with Disabilities Act, and the Family and Medical Leave Act, and brings sophisticated, yet easy to understand advice on handling and defending against sexual harassment claims.From helping clients analyze options and making recommendations on how to handle employee relations issues, to representing clients in complex discrimination cases, Ms. Weber always provides creative solutions and passionate advocacy for her clients. She is also very involved in the transportation industry and has successfully litigated several cutting-edge employment law cases which have been of great benefit to transportation industry employers.

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Jamie M. Goetz-Anderson Employment litigation lawyer Jackson Lewis
Associate

Jamie M. Goetz-Anderson is an Associate in the Cincinnati, Ohio, office of Jackson Lewis P.C. Her practice is focused on representing management in employment litigation and providing advice and counsel on a wide variety of issues, including employee leave, wage and hour, policies and handbooks, discipline and termination.

Ms. Goetz-Anderson also has experience representing employers in class and collective actions brought by both private parties and the Equal Employment Opportunity Commission.

While attending law school, Ms...

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