APPEAL from the Circuit Court of Cook County; the Hon. ARTHUR
L. DUNNE, Judge, presiding.
MR. PRESIDING JUSTICE MCGLOON DELIVERED THE OPINION OF THE COURT:
Plaintiff, John W. Benekos, was declared to be ineligible for unemployment compensation benefits by the defendant, the Illinois Department of Labor's Board of Review, and sought administrative review of the Board's decision. The circuit court of Cook County reversed the defendant's decision, and this appeal follows. The principal issue for our determination is whether an individual receiving initial pension payments from the Federal government is disqualified from receiving unemployment compensation benefits due to the operation of section 611 of the Illinois Unemployment Compensation Act (Ill. Rev. Stat. 1971, ch. 48, par. 441).
Plaintiff voluntarily retired from his employment as an attorney in the civil service of the United States Government on June 30, 1972, and began drawing his pension. He applied for unemployment compensation about five weeks later when he could not find a job. A claims adjudicator of the Illinois Department of Labor's Bureau of Employment Security-Division of Unemployment Compensation examined plaintiff's claim for unemployment compensation, but found that the amount of plaintiff's pension from the Federal government was so high as to disqualify plaintiff from receiving unemployment compensation benefits. Section 611 of the Unemployment Compensation Act provides:
"A. For the purposes of this Section `disqualifying income' means:
1. The entire amount which an individual has received or will receive with respect to a week in the form of a retirement payment (a) from an employing unit for which he performed services and which pays all of the cost of such retirement payment, or (b) from a trust, annuity, or insurance fund or under an annuity or insurance contract, to or under which an employing unit for which he performed services pays or has paid all of the premiums or contributions; and
2. One-half the amount which an individual has received or will receive with respect to a week in the form of a retirement payment (a) from an employing unit for which he performed services and which pays some, but not all, of the cost of such retirement payment, or (b) from a trust, annuity or insurance fund or under an annuity or insurance contract, to or under which an employing unit for which he performed services pays or has paid some, but not all, of the premiums or contributions.
B. Whenever an individual has received or will receive a retirement payment for a month, an amount shall be deemed to have been paid him for each day equal to one-thirtieth of such retirement payment. If the retirement payment is for a half-month, an amount shall be deemed to have been paid the individual for each day equal to one-fifteenth of such retirement payment. If the retirement payment is for any other period, an amount shall be deemed to have been paid the individual for each day in such period equal to the retirement payment divided by the number of days in the period.
C. An individual shall be ineligible for benefits for any week with respect to which his disqualifying income equals or exceeds his weekly benefit amount. If such disqualifying income with respect to a week totals less than the benefits for which he would otherwise be eligible under this Act, he shall be paid, with respect to such week, benefits reduced by the amount of such disqualifying income."
Plaintiff appealed to the Department's labor hearing referee, and an evidentiary hearing was held. The referee made findings and then affirmed the claims adjudicator's determination. Plaintiff then appealed to the Department's Board of Review, which affirmed the referee's decision. At each level of the proceedings, the Department's position was that plaintiff received a pension from the Federal government, and that since the Federal government and plaintiff contributed to the pension fund from which plaintiff's retirement payments were made, each payment was from an employing unit which, in the words of the statute, "pays some, but not all, of the cost of such retirement payment." Applying section 611(A)(2)(a), the Department computed plaintiff's disqualifying income. Plaintiff's weekly pension was shown to be $138, and his weekly benefit amount, if he were eligible, would be $51. Since one-half of the weekly pension is $69, which exceeds the weekly benefit amount of $51, plaintiff was found to be ineligible for unemployment compensation because of section 611(C).
Plaintiff filed complaint for administrative review of the Board of Review's decision. A hearing on the complaint was held, after which the circuit court of Cook County held that section 611(A)(2) of the Act did not apply to the facts of the case, that plaintiff was entitled to unemployment compensation, and that the Board's decision was against the manifest weight of the evidence.
Plaintiff's position is that section 611 does not apply to his case because the Federal government did not contribute any money to each retirement payment he received. Mr. Benekos testified and presented evidence to show how the Federal civil service pension plan operated. Under the plan, both the employee and the employing agency make regular contributions to the Federal Civil Service Pension Fund during the course of employment. Under the regulations governing the operation of the Fund, the government keeps a separate retirement account record for each employee, showing the amounts of his contributions to the plan. When the employee becomes eligible for his pension, he is given retirement payments on a regular basis. The crucial feature of the plan is that the initial payments are funded exclusively from the employee's contributions until exhausted and thereafter from the employing agency's contributions and the plan itself. Should the employee receiving retirement payments die, the residue of the funds of his individual retirement account is paid to the decedent's estate. Plaintiff argues that since he is receiving his initial retirement payments, he is receiving his own money exclusively so that the Federal government did not pay any part of the cost of each payment.
• 1 Defendant argues that the Federal government pension plan's distinction between the initial payments being paid exclusively from the employee's contribution and the subsequent payments is only an administrative or accounting procedure. To adopt the plaintiff's argument, defendant contends, would be to disregard the reality that the pension plan should be considered as a whole, and to disregard the legislature's intended purpose of section 611. As defendant states in its reply brief to this court: "A reading of section 611 must lead to the conclusion that the legislature intended pension payments received pursuant to a plan financed partly by the employer should reduce the amount of unemployment compensation to be paid."
In support of its position, defendant cites cases from other jurisdictions inasmuch as this problem has never been before an Illinois court. Rogers v. District Unemployment Compensation Board (D.C. App. 1972), 290 A.2d 586, involved an individual who retired from the Postal Service with a pension from the U.S. Civil Service Retirement Fund, who applied for ...