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Termination of Unemployment Insurance Benefits

January 10, 1994

Ann Q. Duncan, Chairman Employment Security Commission of North Carolina

P. O. Box 25903 Raleigh, North Carolina 27611

Re: Advisory Opinion; N.C.G.S. 96-14(3)(ii); Termination of unemployment insurance benefits to an individual offered suitable work contingent on passing a drug test who then fails the test

Dear Ms. Duncan:

The Employment Security Commission of North Carolina (ESC) recently discussed a situation where an applicant was referred to a potential employer who offered employment upon condition the applicant pass a drug test. The applicant failed the drug test. The potential employer reported this information to the ESC, but no action was taken because this situation does not currently raise an issue on the unemployment insurance claim under the procedures now in effect.

To correct this obvious inequity, the Commissioners are considering enacting a procedure which requires that when a person receiving unemployment insurance benefits is offered suitable work contingent on passing a drug test and then fails the test, the issue of whether this person has constructively refused work under N.C.G.S. 96-14(3)(ii) is referred to your Adjudication Department. If the adjudicator determines that the person has constructively refused work, then the individual would be disqualified from receiving further unemployment insurance benefits. You ask whether the Commission has the authority to adopt such a procedure.

For reasons which follow, it is my opinion that N.C.G.S. 96-4(b) authorizes the Commission to adopt a regulation that would take care of this problem. Such a regulation would be based on

N.C.G.S. 96-14(3)(ii), which allows unemployment benefits to be discontinued where the individual has failed without good cause "to accept suitable work when offered him."

I could not find a case directly in point in this or any other jurisdiction. Your staff found a number of cases from other jurisdictions which address the issue of constructive refusal of work where a claimant discouraged a potential employer from offering him a job or from hiring him. You are already familiar with these cases and their rationale from the brief provided by your staff, and I will not repeat any of that here.

From a common sense point of view, where a person is offered employment subject to passing a drug test, and that person fails the test, that person has constructively refused a suitable job offer. This assumes, of course, that the individual was using illegal drugs, that the drug test was reliable, etc. All of this would have to come out during the adjudication process. More often than not, common sense and the law run parallel to one another and are in harmony, as I believe is the case here. Although there are no cases directly in point, our courts have time and time again discussed the term "misconduct" in the context of eligibility for unemployment benefits. "’Misconduct’ may consist in deliberate violations or disregard of standards of behavior which the

employer has the right to expect of his employee." Hagen v. Peden Steel Co., 57 N.C. App. 363, 365 (1982). In accord, Douglas v. J.C. Penny Co., 67 N.C.App. 344 (1984); Miller v. Guilford County Schools, 62 N.C.App. 729, cert. den., 309 N.C. 321 (1983). Being free form illegal drugs clearly is a reasonable expectation for any employer to have concerning his employees.

In conclusion, where an individual receiving unemployment benefits is offered a job contingent upon passing a drug test, and that individual fails the drug test, it is within the Commission’s present authority to adopt a regulation that requires an adjudicatory hearing to determine whether that person was guilty of "misconduct" (the ingestion and use of illegal drugs such as marijuana or cocaine,etc.); and for that reason and due to his or her own fault, did not accept suitable work when it was offered.

Should you require anything further, please advise.

Andrew A. Vanore, Jr. Chief Deputy Attorney General