                   NOT FOR PUBLICATION WITHOUT THE
                  APPROVAL OF THE APPELLATE DIVISION

                                     SUPERIOR COURT OF NEW JERSEY
                                     APPELLATE DIVISION
                                     DOCKET NO. A-3128-13T1

PREETI GUNDECHA,
                                        APPROVED FOR PUBLICATION
     Appellant,
                                             June 26, 2015
v.
                                          APPELLATE DIVISION
BOARD OF REVIEW and
DB SERVICES NEW JERSEY, INC.,

     Respondents.
___________________________________________

         Submitted May 12, 2015 – Decided June 26, 2015

         Before Judges Reisner, Higbee, and Currier.

         On   appeal  from   the   Board  of   Review,
         Department    of    Labor    and    Workforce
         Development, Docket No. 417,546.

         Preeti Gundecha, appellant pro se.

         John J. Hoffman, Acting Attorney General,
         attorney for respondent Board of Review
         (Lewis A. Scheindlin, Assistant Attorney
         General, of counsel; Robert M. Strang,
         Deputy Attorney General, on the brief).

         Respondent DB Services New Jersey, Inc., has
         not filed a brief.

     The opinion of the court was delivered by

CURRIER, J.S.C. (temporarily assigned).

     In this case of first impression, claimant Preeti Gundecha

(Gundecha) appeals from the February 18, 2014 final decision of
the Board of Review (Board) affirming the decision of the Appeal

Tribunal denying her claim for New Jersey unemployment benefits

pursuant       to   N.J.S.A.      43:21-19(i)(2).               We   affirm,         because

although       Gundecha     was   employed       by    the     company's       New    Jersey

office,    she      performed     all   of       her    work    in     North    Carolina.

Therefore, she was entitled to unemployment benefits in North

Carolina, not New Jersey.

    Gundecha        began    working    for      Deutsche       Bank    (DB)     in     1999.

After working briefly in DB's London office, she was transferred

to New York and worked there until 2007.                      In 2008 Gundecha began

working in a New Jersey office but left on maternity leave in

April 2009.         The next month she moved to North Carolina.                             She

remained on maternity leave until December 2009.                         At that time,

Gundecha returned to work for DB, telecommuting out of her home

in North Carolina.          She worked in that manner throughout 2010.

    In January 2011 Gundecha became ill and was unable to work

for the next eighteen months.               She was released by her doctor to

return    to    work   in    July    2012.        She    was    laid    off     by     DB    in

September 2012 and given a year of severance pay.

    In     February       2013      Gundecha      applied       to   New      Jersey        for

unemployment        benefits.1        Her    claim      was    denied.           Claimant


1
   Claimant alleges that she contacted the North Carolina
Department of Labor and checked its website in September 2012
                                                  (continued)


                                             2                                       A-3128-13T1
appealed     the     agency's       determination.             After       a     telephone

interview,    the    Appeal       Tribunal         affirmed      the     prior    decision

noting that claimant had not established the required base weeks

or earnings within New Jersey and was therefore not eligible for

benefits under N.J.A.C. 12:17-5.1.

      Gundecha appealed the Tribunal's decision on the grounds

that she had followed the instructions she had received from a

North   Carolina     representative          to      file    for    benefits       in   New

Jersey.     The Board remanded the matter to the Appeal Tribunal

"for additional testimony from the claimant . . . as to whether

the   claimant's     services      were    localized        in     the    state    of   New

Jersey or in the state of North Carolina . . . ."

      Gundecha      participated      in       a     second      telephone        hearing,

following    which    the    Appeal       Tribunal         rendered      its     decision.

Citing to N.J.S.A. 43:21-19 and the definition of "employment"

therein, the Tribunal found that "claimant worked most recently

for the above named employer [DB] out of her residence in North

Carolina as a project manager from 12/2009 until 1/28/11.                               The

claimant's regular work was in North Carolina.                           Therefore, the

employee's    service       was     localized         in      North      Carolina,      the


(continued)
after being laid off. She states she was told that she had to
wait for her severance benefits to be exhausted before she could
file for unemployment benefits and that she should apply for
benefits in New Jersey.



                                           3                                      A-3128-13T1
claimant's work was not in [']employment['] in accordance with

N.J.S.A. 43:21-19(i)(2) and the claim dated 2/17/13 is invalid."2

Gundecha appealed from that decision, and on February 18, 2014,

the Board affirmed the decision of the Appeal Tribunal. This

appeal followed.

     On appeal, Gundecha argues that she was employed by a New

Jersey company and therefore should be considered a New Jersey

employee for purposes of unemployment benefits.         She states she

was temporarily telecommuting from North Carolina and intended

to return to physically work in New Jersey.3

     Our review of legal issues is de novo.          Manalapan Realty,

L.P. v. Twp. Comm., 140 N.J. 366, 378 (1995).                 However, we

generally defer to an agency's reasonable interpretation of its

enabling statute.     See GE Solid State, Inc. v. Dir., Div. of

Taxation, 132 N.J. 298, 306 (1993); SJC Builders, LLC v. N.J.

Dep't of Envirl. Prot., 378 N.J. Super. 50, 54 (App. Div. 2005).

     Historically,   Congress   encouraged    the    states    to    create

their   own   unemployment   systems   when   it    passed    the    Social

Security Act in 1935.    In response, states set up systems where

2
  The Appeal Tribunal also considered whether claimant qualified
for benefits under the alternate base year after disability
option but determined she did not under the same statutory
analysis. N.J.S.A. 43:21-19(c)(2).
3
  As of the time she filed her appeal, claimant continued to
reside in North Carolina.



                                  4                                 A-3128-13T1
employers contribute to the states' unemployment funds and under

the Federal Unemployment Tax Act, the excise tax paid by an

employer to a state unemployment fund is credited toward the

employer's tax liability.           Beverly Reyes, Note, Telecommuters

and   Their    Virtual   Existence    in     the       Unemployment    World,   33

Hofstra L. Rev. 785, 789 (2004).

      As the systems expanded, it became important for uniform

definitions to be used throughout the nation on the theory that

only one state would be liable for a claimant's unemployment

compensation benefits.        Vale v. Gaylords Nat'l Corp., 127 N.J.

Super.   45,    47   (App.   Div.   1974).         A    uniform    definition   of

"employment"      was    ultimately    adopted          by   forty-six     states

(including New Jersey) and the District of Columbia.                       Reyes,

supra, 33 Hofstra L. Rev. at 790.             That definition remains in

effect today in N.J.S.A. 43:21-19(i)(2).

       N.J.S.A. 43:21-19 requires that a claimant have employment

in New Jersey to be eligible for benefits.                        "Employment" is

defined at Section 43:21-19(i)(2) as:

              [A]n individual's entire service performed
              within or both within and without this State
              if:

              (A) The service is localized in this State;
              or

              (B) The service is not localized in any
              state but some of the service is performed
              in   this State,  and  (i)   the base   of



                                      5                                  A-3128-13T1
             operations, or, if there is no base of
             operations, then the place from which such
             services is directed or controlled, is in
             this State; or (ii) the base of operations
             or place from which such service is directed
             or controlled is not in any state in which
             some part of the service is performed, but
             the individual's residence is in this State.

             [N.J.S.A. 43:21-19(i)(2).]

      The     statute     thus   contains       four   tests   to        be   applied

successively to determine the appropriate state for the filing

of unemployment benefits.           The first test is the localization

test.      It is defined at N.J.S.A. 43:21-19(i)(5) as:

             [s]ervice shall be deemed to be localized
             within a state if:

             (A) The service is performed entirely within
             such state; or

             (B) The service is performed both within and
             without   such   state,  but   the   service
             performed without such state is incidental
             to the individual's service within the
             state;   for   example,  is   temporary   or
             transitory in nature or consists of isolated
             transactions.

             [Ibid.]

      If    the   first   test   reveals    a    single   state     in    which     the

services are performed, then the state unemployment agency need

not apply the other tests.          See Vale, supra, 127 N.J. Super. at

48.

      Thus, the primary issue before us is whether claimant's

services were "localized" in New Jersey.               New Jersey courts have



                                       6                                      A-3128-13T1
not   considered     the    "localization"    requirement    in   over    forty

years.      See Vale, supra, 127 N.J. Super. 45.           Telecommuting was

not a part of the employment landscape until recently but it has

become a normal way of working for many employees.4                Thus, the

issue before us is how the localization rule should be applied

to telecommuters.

      One     jurisdiction     that     has    addressed    the    issue      of

"localization" as it respects telecommuters is New York.                 In In

re Claim of Allen, 794 N.E. 2d 18 (N.Y. 2003), a case with

similar     circumstances,     the    claimant   employee    worked   in    the

employer's     New   York    office    for    several   years.     When     she

relocated to Florida she was permitted to "telecommute" to her

office in New York.         After her employer ended the telecommuting

arrangement, the claimant filed for unemployment benefits in New

York.

      The New York court applied the localization test and held

that "physical presence determines localization for purposes of




4
  Between 2005 and 2010 there was an increase in home-based work.
"During this time, the number of home-based workers went from
7.8 percent of all workers to 9.5 percent, an increase of about
2 million."    Peter J. Mateyka, Melanie A. Rapino, and Liana
Christin Landivar, Home-based Workers in the United States:
2010,    U.S.   Census    Bureau   3    (2012),    available   at
http://www.census.gov/prod/2012pubs/p70-132.pdf.




                                       7                              A-3128-13T1
interpreting    and     applying      Section      5115    to    an     interstate

telecommuter.      Because     the    claimant     was    regularly     physically

present in Florida when she worked for her employer in New York,

her work was localized in one state — Florida." Id. at 22.

Accordingly the claimant was found ineligible for unemployment

benefits from New York.

       As was explained by the New York Court of Appeals, "the

uniform rule was intended to promote efficiency, and to ensure

that    unemployment    benefits      are   paid   by     the   state    where   an

unemployed individual is physically present to seek new work.

Unemployment has the greatest economic impact on the community

in which the unemployed individual resides . . . .                    In our view,

physical     presence     is    the     most     practicable       indicium      of

localization    for     the    interstate      telecommuter       who     inhabits

today's 'virtual' workplace linked by Internet connections and

data exchanges."       Ibid.   We agree.

       The localization rule continues to be the simplest and most

efficient method for determining jurisdiction for unemployment

benefits.    And despite the modern technology advances that could

not have been imagined when the states adopted the localization

test, the theory behind the definition of "employment" still

holds true today.       It remains feasible and most practicable for

5
    This is identical to N.J.S.A. 43:21-19(i)(2).



                                        8                                 A-3128-13T1
the employee's physical presence to be the determinative factor

in    determining       "localization."                It    continues         to     be     a

straightforward solution for an employee to know where to file

for benefits and for each state to know its responsibilities.

Of course, if the employee's service does not fit within the

definition, the remaining tests set forth in the statute are

analyzed.        See Vale, supra, 127 N.J. Super. at 48.

      In this case claimant lives in North Carolina.                                Although

she   was   employed     by    and    provided      services        to   the   DB    office

located     in    New   Jersey,      she   was    physically        present     in     North

Carolina at all times that she was working.                         Therefore her work

and employment was localized in North Carolina and that is the

state responsible for her benefits.

      If    claimant     was   given       advice      by   North    Carolina's        Labor

Department that she should pursue her benefits in New Jersey

that advice was incorrect.             Gundecha must pursue her remedies in

North   Carolina.         We   find    that      the    Board's      decision       holding

claimant ineligible for unemployment benefits under N.J.S.A. 43-

21-19(i)(2) is correct.

      We affirm.




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