Title of Regulation: 16VAC5-80. Adjudication (amending 16VAC5-80-20).

Statutory Authority: §§ 60.2-111 and 60.2-623 of the Code of Virginia.

Public Hearing Information: No public hearing is currently scheduled.

Public Comment Deadline: June 7, 2023.

Effective Date: June 22, 2023.

Agency Contact: Jason German, Hearing Legal Services Officer III, Virginia Employment Commission, 6606 West Broad Street, Henrico, VA 23230, telephone (804) 786-4140, FAX (804) 786-9034, or email jason.german@vec.virginia.gov.

Basis: The Virginia Employment Commission may promulgate this action pursuant to § 60.2-111 of the Code of Virginia.

Purpose: The amendment adds one method to the list of ways to appeal. Specifically, the amendment adds that appeals can be filed by an electronic format as prescribed by the commission. This is an attempt to modernize the regulation to provide citizens with a more modern and integrated method of filing appeals.

Rationale for Using Fast-Track Rulemaking Process: The impetus for the regulatory change is an internal staff review of procedures to best meet the needs of Virginians seeking Virginia Employment Commission services. The regulation has not been updated for many years, and this regulatory change is necessary to modernize agency procedures, increase accessibility for Virginians, and expedite agency services. The changes are expected to be noncontroversial.

Substance: The amendment adds that appeals can be filed by an electronic format as prescribed by the commission. This is meant to utilize the commission's current portal system and future updates and improvements.

Issues: The advantages to both the public and the agency are the ability to file and receive appeals through a more modern system, including online forms and portals. There is no disadvantage since the legacy methods of postal mail, fax, and via the Internet have not been removed.

Department of Planning and Budget's Economic Impact Analysis:

The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Code of Virginia and Executive Order 19. The analysis presented represents DPB's best estimate of these economic impacts.¹

Summary of the Proposed Amendments to Regulation. The Virginia Employment Commission (VEC) proposes to update the regulation to reflect that first level appeals can be filed through its new online portal (i.e., a webpage on the VEC website), that an appeal decision can be delivered through the portal, and that a request for reopening of an appeal can be submitted through the portal.

Background. Currently, this regulation provides that first level appeals shall be filed in person, by mail, by fax, or "by the Internet at a site or address specified by the commission." The filing option by an Internet address is currently interpreted by VEC to be a link to a webpage as opposed to at a webpage.

In late 2021, VEC started using a new online portal for unemployment claim filing and processing. Among other purposes, the portal was designed to cater to the appeals-related needs of claimants, employers, attorneys, and other parties. This portal made it possible for the stakeholders to access their case information online at a centralized location by registration (i.e., by username and password). However, the current regulatory language regarding approved ways to file a first level appeal does not encompass filing of an appeal through this portal. For this reason, VEC proposes to add in the regulation that a first level appeal can be filed "[b]y an electronic format as prescribed by the commission." VEC interprets the phrase "an electronic format" to include through its new portal.

Similarly, the current language requires that an appeal decision be delivered and a request for reopening of an appeal be submitted by mail. VEC proposes to replace the word "mail" with the phrase "in a format prescribed by the commission." Instructions about approved formats are usually provided along with relevant documents, such as a decision. VEC states that these proposed changes do not eliminate the delivery of a decision or the submission of a request by mail. Instead, VEC states that the changes will mean that the commission can issue an appeal decision through its portal and a request for reopening can be submitted through the portal in addition to by mail.

Estimated Benefits and Costs. To the extent that an online portal differs from an online webpage, the proposed addition of filing of a first level appeal against an unemployment claim through VEC's new online portal would expand the methods by which an appeal can be filed. The portal is accessible by registration to all interested parties including employers, claimants, and attorneys. In addition, the other changes that would allow the commissioner to deliver an appeal decision through the portal and allow a party to request reopening of the case through the portal in addition to mail would expand the means of processing an appeal.

With these changes, affected parties would likely use the portal if it is more convenient for them. Since the regulatory text retains all of the existing options for filing an appeal, delivering a decision, and requesting a reopening, adding a new option to use the portal would not be costly and may produce net benefits to employers (i.e., appellants) as well as claimants or their legal counsel.

VEC reports that the new online portal has other features and capabilities in addition to filing of first level appeals. The estimated cost of the portal pertaining to appeals-related features is approximately $250,000. However, some of this cost would be offset by benefits to VEC to the extent the portal improves the efficiency of appeals processing for VEC relative to existing methods.

Finally, updating the regulatory language to reflect the current use of the portal for several purposes would benefit potential users who may not have been otherwise aware of this option.

Businesses and Other Entities Affected. The proposed changes primarily affect entities involved with first level appeals. Since February 2022, there have been 50,923 first level appeals filed with the commission. No entity appears to be disproportionately affected.

The Code of Virginia requires DPB to assess whether an adverse impact may result from the proposed regulation.² An adverse impact is indicated if there is any increase in net cost or reduction in net revenue for any entity, even if the benefits exceed the costs for all entities combined. As noted, the proposed changes provide additional methods for filing a first level appeal, issuing a decision, and submitting a request for reopening, but do not take away any existing options. Thus, no direct adverse impact is indicated.

Small Businesses³ Affected.⁴ The proposed amendments do not adversely affect small businesses.

Localities⁵ Affected.⁶ The proposed amendments do not introduce costs for local governments or particularly affect any locality.

Projected Impact on Employment. The proposed amendments do not appear to have a direct impact on total employment.

Effects on the Use and Value of Private Property. No significant impact on the use and value of private property or real estate development costs is expected.

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¹Section 2.2-4007.04 of the Code of Virginia requires that such economic impact analyses determine the public benefits and costs of the proposed amendments. Further the analysis should include but not be limited to: (1) the projected number of businesses or other entities to whom the proposed regulatory action would apply, (2) the identity of any localities and types of businesses or other entities particularly affected, (3) the projected number of persons and employment positions to be affected, (4) the projected costs to affected businesses or entities to implement or comply with the regulation, and (5) the impact on the use and value of private property.

²Pursuant to § 2.2-4007.04 D: In the event this economic impact analysis reveals that the proposed regulation would have an adverse economic impact on businesses or would impose a significant adverse economic impact on a locality, business, or entity particularly affected, the Department of Planning and Budget shall advise the Joint Commission on Administrative Rules, the House Committee on Appropriations, and the Senate Committee on Finance. Statute does not define "adverse impact," state whether only Virginia entities should be considered, nor indicate whether an adverse impact results from regulatory requirements mandated by legislation.

³Pursuant to § 2.2-4007.04, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

⁴If the proposed regulatory action may have an adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include: (1) an identification and estimate of the number of small businesses subject to the proposed regulation, (2) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the proposed regulation, including the type of professional skills necessary for preparing required reports and other documents, (3) a statement of the probable effect of the proposed regulation on affected small businesses, and (4) a description of any less intrusive or less costly alternative methods of achieving the purpose of the proposed regulation. Additionally, pursuant to § 2.2-4007.1 of the Code of Virginia, if there is a finding that a proposed regulation may have an adverse impact on small business, the Joint Commission on Administrative Rules shall be notified.

⁵"Locality" can refer to either local governments or the locations in the Commonwealth where the activities relevant to the regulatory change are most likely to occur.

⁶Section 2.2-4007.04 defines "particularly affected" as bearing disproportionate material impact.

Agency's Response to Economic Impact Analysis: The Virginia Employment Commission concurs with the Department of Planning and Budget's economic impact analysis.

Summary:

The amendments update the regulation to reflect that first level appeals can be filed through the commission's new online portal, that an appeal decision can be delivered through the portal, and that a request for reopening of an appeal can be submitted through the portal. These changes are accomplished by adding language allowing first level appeals to be filed by an electronic format prescribed by the Virginia Employment Commission.

16VAC5-80-20. First level appeals.

A. The claimant, the claimant's liable employer, or any subsequent employing unit with a direct interest in an issue may appeal from an adverse deputy's determination or decision as specified in § 60.2-619 of the Code of Virginia.

1. Appeals shall be filed with the commission's Administrative Law Division's Office of First Level Appeals in one of the following ways:

a. In person at any agency service location, including workforce, adjudication, or one-stop centers, or the commission's administrative office in Richmond, Virginia;

b. By mail to the Administrative Law Division's Office of First Level Appeals at the address specified on the deputy's determination or decision;

c. By facsimile transmission to the Administrative Law Division's Office of First Level Appeals at the facsimile number specified on the deputy's determination or decision; or

d. By the Internet at a site or address specified by the commission; or

e. By an electronic format as prescribed by the commission.

2. Appeals shall be presumed to be filed on the date of receipt by the commission. An appeal mailed to the commission shall be presumed to be filed on the date of postmark by the United States U.S. Postal Service. If no postmark appears on the envelope, the appeal shall be presumed to be filed on the date it was received by the commission.

3. Appeals shall be in writing and should set forth the grounds upon which they are sought, as well as the name and last four digits of the social security account number of the claimant; however, any document in writing submitted to the commission by a party or a party's authorized representative expressing a desire to appeal shall be sufficient to initiate an appeal. Agency personnel shall furnish an appellant or an appellant's authorized representative whatever assistance is necessary to file an appeal. The appeal should be signed by the appealing party or that party's authorized representative; however, the absence of a signature shall not result in the dismissal of the appeal.

B. After the filing of an appeal, the record in connection with the claim, together with the notice of appeal, shall be assigned to an appeal tribunal consisting of a salaried examiner only. Should evidence indicate that the appeal was not filed within the time prescribed by law, the first issue to be considered at the hearing shall be whether the appeal was timely filed or whether there exists good cause for extending the appeal period.

1. Except as otherwise provided in this chapter, all hearings shall be conducted by telephone conference call. At the discretion of the commission, a split hearing or an in-person hearing may be scheduled if the complexity of the case or the quality of telephone service in a particular locality makes participation in the hearing unreasonably difficult. A split or in-person hearing will be scheduled if a party does not have reasonable access to a telephone that would permit meaningful participation in a telephonic hearing. In assessing the complexity of a particular case, the commission shall consider the number of witnesses involved, the number and length of any documents that will likely be proposed as exhibits, whether one or both parties are represented, whether an interpreter is required, and any other relevant factors. In-person or split hearings shall be scheduled at a location administratively feasible for the commission.

2. Any party who desires to appear in person for the hearing shall be permitted to do so provided a timely request is received by the commission. A request shall be deemed timely if it is received by the commission before the scheduled hearing convenes. If a request to appear in person is received after the hearing has been convened, the presiding appeals examiner may grant or deny the request based upon consideration of all relevant circumstances. A request by a party to appear in person shall not require any other party to also appear in person; however, any other parties to the proceeding should be promptly informed of the request for in-person participation and be given the opportunity to participate in person if the commission grants a party's in person in-person hearing request.

3. A hearing that is postponed or continued to accommodate a request for in-person participation shall be rescheduled as soon as administratively feasible.

4. A notice of hearing shall be mailed to all parties and their known authorized representatives at least 10 days in advance of the hearing. The hearing notice shall set forth the particular statutory provisions and regulations that must be considered to resolve the case. The appeals examiner may consider any other applicable issues that are raised or become evident during the course of the hearing provided that all parties in interest are present and all agree on the record to waive the 10-day notice requirement with respect to such new issue. The appeals examiner may refer a new issue to the deputy if it has not been ruled upon at that level and may, upon the appeals examiner's own motion, postpone or continue the case if a new issue has become evident and it is necessary to give proper written notice in order to proceed.

C. The Office of First Level Appeals (First Level Appeals) shall endeavor to schedule hearings as soon as possible in the order in which appeals are received. Special requests regarding dates or times of hearings will be given consideration; however, they need not always be honored. Requests for postponement of scheduled hearings shall be granted only when a party or the party's authorized representative demonstrates good cause for an inability to appear at the scheduled date and time. Good cause shall be deemed to exist if a likelihood of material and substantial harm is shown. Postponements may be granted only by the Chief Appeals Examiner or the Chief Appeals Examiner's designee, the Clerk of the Commission for First Level Appeals, the examiner assigned to hear the case, or an appeals examiner acting in charge of the Office of First Level Appeals, although they may be communicated to the parties by other authorized persons. A postponed hearing may be rescheduled without notice if all parties in interest agree. Otherwise, notice of a postponed hearing shall be given as if it were a new hearing.

D. Once a hearing has commenced, it may be continued only by the presiding appeals examiner, either upon the presiding appeals examiner's own motion or that of a party. Continuances may be granted in situations where (i) there is insufficient time to properly hear the evidence; or (ii) unexpected or unavoidable circumstances arise during the course of a hearing that require a continuance in order to protect the substantive or procedural rights of the parties.

A continued hearing may be rescheduled by the presiding appeals examiner without written notice if all parties in interest are present and all concur. Otherwise, notice of a continued hearing shall be given as if it were a new hearing.

E. If the appellant wishes to withdraw the appeal, a request, together with the reasons therefor, must be made in writing and sent to the Clerk of the Commission of First Level Appeals at the commission's administrative office in Richmond, Virginia. The request will be granted only if the Chief Appeals Examiner, the Chief Appeals Examiner's designee, or the appeals examiner assigned to hear the case is satisfied that:

1. The appellant understands the effect that withdrawal will have upon benefit entitlement, potential benefit charges, and potential overpayment;

2. The request is not the result of any coercion, collusion, or illegal waiver of benefits prohibited under § 60.2-107 of the Code of Virginia; and

3. The appealed determination is not clearly erroneous based upon the existing record.

Once granted, a withdrawal cannot be rescinded unless an evidentiary hearing on the issue of rescission is held before an appeals examiner, and the former appellant demonstrates that the criteria required for withdrawal were not fully met. A request to rescind a withdrawal must be filed with the commission within 30 days from the issuance of the Order of Dismissal or the discovery of information that would establish that withdrawal criteria were not met.

F. In any hearing before an appeals examiner, all testimony shall be taken under oath or affirmation and a record of the proceedings shall be made by the presiding appeals examiner who shall inform all parties of this fact. No other recording of the proceedings other than that specifically authorized by the Virginia Unemployment Compensation Act (§ 60.2-100 et seq. of the Code of Virginia) shall be permitted.

The appeals examiner shall conduct the hearing in such a manner as to ascertain the substantive rights of the parties without having to be bound by common law, statutory rules of evidence, or technical rules of procedure. In addition to testimony, the appeals examiner may accept relevant documents or other evidence into the record as exhibits, upon the motion of a party.

1. Where a party is unrepresented, the appeals examiner shall assist that party in presenting his that party's case and testing the case of the opposing party.

2. At any hearing before an appeals examiner, an interested party may appear in person, by counsel, or by an authorized representative. All such persons will be permitted to attend the entire hearing.

3. An employer shall be permitted one representative, in addition to counsel or duly authorized agent, who may attend the entire proceeding. The appeals examiner shall exclude any other witnesses from the hearing until such time as their testimony is to be taken. Observers may be permitted to attend the hearing so long as there is no objection by a party.

4. The appeals examiner shall control the order of proof, rule upon the admission of evidence, and may examine and cross-examine witnesses. The examiner shall have the authority to maintain order and eject disruptive or unruly individuals. At a hearing, the parties, counsel, or duly authorized representatives shall be given an opportunity to cross-examine witnesses, to inspect documents, and to offer evidence in explanation and rebuttal. On motion of the appeals examiner, or any party, documents already in a claimant's file or obtained during the course of a hearing may be admitted into the record as exhibits provided they are relevant to the issues in dispute. Before the hearing is closed, the parties shall be given an opportunity to present oral argument on all the issues of law and fact to be decided. In addition, the appeals examiner may permit the parties to submit written arguments.

G. The decision of the appeals examiner shall be reduced to writing and shall state the issues, findings of fact, opinion or reasons for the decision, and final judgement of the examiner. A copy of the decision shall be mailed delivered in a format prescribed by the commission to each of the interested parties and their known representatives who have requested to be notified of the decision. If the decision is rendered by an appeals examiner other than the one who presided at the hearing, that examiner shall review the record of the hearing and so state in the decision.

H. If any party believes that the appeals examiner exhibits bias toward one or more parties in a case, a challenge to the interest of such appeals examiner shall be made promptly after the discovery of facts on which such challenge is based, but not later than the date on which the decision is issued. A challenge to the interest of the appeals examiner made during the course of the hearing shall be decided and ruled upon by the presiding appeals examiner. If the presiding appeals examiner grants the challenge and withdraws from the case, the appeals examiner shall adjourn the hearing and promptly return the case to the Clerk of the Commission for rescheduling before a different appeals examiner. If a party challenges the interest of an appeals examiner after the conclusion of the hearing, but before the decision is issued, the challenge shall be set forth in writing with the reasons therefor, and sent to the chief appeals examiner at the Administrative Office of First Level Appeals of the Commission in Richmond, Virginia. If the Chief Appeals Examiner or the Chief Appeals Examiner's designee does not remove the challenged appeals examiner, the appeals examiner shall render a decision in the case. If the challenged appeals examiner is removed, is unavailable or chooses to withdraw, the Chief Appeals Examiner or the Chief Appeals Examiner's designee shall decide the case. Failure to remove the appeals examiner shall be subject to review by the commission on appeal by the aggrieved party, in the same manner as any other issue in the case.

I. Any party who is unable to appear for the scheduled hearing, or who appeared but wishes to present additional evidence, may request a reopening of the case, which will be granted if good cause is shown. The request, together with the reasons therefor, shall be made in writing and sent to the Chief Appeals Examiner in the administrative office of the commission in Richmond, Virginia.

1. Where a request for reopening is received before the decision of the appeals examiner is issued, the decision shall be withheld if the Chief Appeals Examiner, the Chief Appeals Examiner's designee, or the appeals examiner assigned to the case, finds that the reasons given in the request, if proven, would establish good cause to reopen the hearing. In that event, a hearing will be scheduled on the reopening issue. If, after the hearing, the appeals examiner should decide that reopening is warranted, the case shall be reopened for the taking of additional evidence. If no reasons are given for the reopening request, or if the reasons given would not establish good cause to reopen the hearing, the appeals examiner shall render a decision denying the request and adjudicating the merits of the case. In any event, the decision concerning the issue of reopening shall be subject to review by the commission on appeal by the aggrieved party.

2. A request for reopening after the appeals examiner has issued a decision on the merits of the case, but within the appeal period, shall be mailed submitted in a format prescribed by the commission to the Administrative Law Division's Office of Commission Appeals in the administrative office of the commission in Richmond, Virginia and shall set forth in writing the reasons therefor. If the commission is of the opinion that the written request establishes good cause for reopening, it shall remand the case to the Chief Appeals Examiner of First Level Appeals. If the commission is of the opinion that the written request does not set forth good cause for reopening, it shall treat the request as an appeal to the commission on the merits of the case pursuant to this part. The commission may, in its discretion, schedule a hearing to receive evidence with respect to a reopening request or remand the case to the appeals examiner to hear and decide the reopening issue.

3. Once a decision is rendered and becomes final, it cannot be reopened for any reason. A request for a reopening after the decision of the appeals examiner has become final shall be treated as an untimely appeal to the commission pursuant to this chapter. In the discretion of the commission, a hearing on the issue of reopening may be held.