Suspension of entitlement due to refusal of a reasonable position after tough wage negotiations: serious fault, no reduction of suspension days

Facts

Parties and subject matter: The Office for Economy and Labour of the Canton of Zurich (AWA), Unemployment Insurance Division, lodges an appeal in public law matters against the judgment of the Social Insurance Court of the Canton of Zurich of 30 October 2020 (AL.2020.00103). The respondent is [A.] , represented by attorney Bernhard Zollinger. The subject matter of the dispute is unemployment insurance, specifically the suspension of entitlement.

Facts: The respondent, born in 1971, worked as a gardener for [B. GmbH] from 20 May to 31 October 2019. On 31 October 2019 he registered with the Regional Placement Office [U.] (AOO) and on 8 November 2019 applied for unemployment benefits from 1 November 2019. By decision of 17 December 2019, the AWA suspended his entitlement for 36 days from 19 November 2019 due to refusal of reasonable work; the objection decision of 21 February 2020 confirmed this.

Application and wage negotiations: On 3 October 2019 the respondent had applied to the company [C.] for a permanent full-time position starting on 1 January 2020. In November 2019 a job interview and three trial days followed. The wage negotiations failed, so no employment contract was concluded. After the trial days, the employer clearly stated that it would not pay more than Fr. 5300.- per month. The respondent requested time to consider and then demanded Fr. 5700.- per month (previously Fr. 6000.-).

Lower court: The Social Insurance Court affirmed the suspension criterion of Art. 30 para. 1 lit. d UIA but reduced the suspension period from 36 to 18 days, on the ground that there was an excusable reason and that the fault was only of medium severity. It based this, among other things, on the general permissibility of wage negotiations, the respondent's previous earnings of over Fr. 5300.- and his willingness to compromise.

Requests before the Federal Supreme Court: The AWA requests that the lower court's judgment be set aside and the objection decision be confirmed; in the alternative, the suspension days should be appropriately increased. The respondent requests dismissal of the appeal. The cantonal court and SECO waived a response.

Legal question: Whether the reduction of the suspension period from 36 to 18 days complies with federal law, in particular whether there was an excusable reason for refusing reasonable work.

Considerations

Legal framework: Within the duty to mitigate damage, the insured person must undertake everything reasonable to avoid or shorten unemployment and must accept any reasonable work without delay (Art. 17 para. 1 and 3 UIA). Under Art. 30 para. 1 lit. d UIA, the person is to be suspended if they do not accept reasonable work. The criterion also covers refusal of a position the person found themselves and any conduct that causes the conclusion of an employment contract to fail. The unemployed person must clearly and unambiguously express willingness to conclude the contract during negotiations (BGE 122 V 34). A causal link with a loss is not required, since the risk of loss is already sanctioned (BGE 141 V 365).

Degrees of fault and excusable reason: Under Art. 45 para. 3 UIO, the suspension for slight fault is 1 to 15 days, for medium fault 16 to 30 days, and for serious fault 31 to 60 days. Refusal of reasonable work without an excusable reason is generally regarded as serious fault (Art. 30 para. 3 UIA in conjunction with Art. 45 para. 4 lit. b UIO). A downward deviation requires special circumstances and an excusable reason, which may be subjective or objective in nature (BGE 130 V 125). The concept of an excusable reason is an indeterminate legal concept whose application is freely reviewable. By contrast, the determination of the suspension period is a matter of discretion, which is corrected only in cases of exceeding, falling short of, or abusing that discretion (BGE 137 V 71).

Assessment by the lower court: It was undisputed that the position at [C.] was reasonable, including with regard to the wage offer of Fr. 5300.-, and that the criterion of Art. 30 para. 1 lit. d UIA was met, since by requesting time to consider the respondent did not signal a clear willingness to conclude. The Federal Supreme Court, however, disagrees with the lower court insofar as it sees the excusable reason in the general permissibility of wage negotiations. If that were sufficient, Art. 45 para. 4 lit. b UIO would in effect be nullified, as an insured person would always have an excusable reason through overly hard negotiations whenever the wage offer was reasonable. The excusable reason cannot lie in precisely the conduct that itself fulfils the suspension criterion.

Concrete assessment: Within the duty to mitigate damage,…