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May 15, 2025
The Wisconsin Supreme Court recently held that non-criminal, municipal citations are “arrest records” covered by state law prohibiting arrest record discrimination. See Oconomowoc Area School District v. Gregory L. Cota, et al., No. 2022AP1158, 2025 Wisc. LEXIS 149 (April 10, 2025).
Factual Background of the Case
Oconomowoc Area School District employed Gregory and Jeffrey Cota. After a coworker accused them of stealing money from the District,[1] the District commenced an internal investigation.[2] The results of that investigation were inconclusive (cash was missing from the District, but the District could not identify who was responsible). Believing that any employment-related discipline would be better made following the conclusion of a criminal investigation, the District turned the case over to the local police. The police investigation revealed no new evidence. The Cotas, however, were cited for municipal theft, a non-criminal offense. About one year later, the assistant city attorney advised the District that he believed he could convict the Cotas, but also believed that he could secure a settlement, including restitution. The next day, the District terminated the Cotas’ employment.[3]
Procedural History of the Case
The Cotas filed clams with the Department of Workforce Development, alleging that the District violated the Wisconsin Fair Employment Act (Act), which prohibits an employer from terminating employment because of an employee’s “arrest record[s].” The Act defines “arrest record” broadly to include “information indicating that an individual has been questioned, apprehended, taken into custody or detention, held for investigation, arrested, charged with, indicted or tried for any felony, misdemeanor or other offense pursuant to any law enforcement or military authority.”
An administrative law judge found in favor of the District on the Cotas’ claims, but the Labor and Industry Review Commission (Commission) reversed (decision in favor of the Cotas). The District sought judicial review of the Commission’s decision. The trial court affirmed that decision (decision in favor of the Cotas), but the appellate court reversed (decision in favor of the District), holding that the Act’s definition of “arrest record” did not include non-criminal offenses[4] like municipal theft.
The Wisconsin Supreme Court’s Analysis
On appeal, the Wisconsin Supreme Court ruled in favor of the Cotas, holding that the phrase “any … other offense” in the Act’s definition of “arrest record” includes non-criminal offenses. In so holding, the Court looked at the ordinary meaning of the word “offense,” how that term has been used (to include both criminal and non-criminal offenses) in other Wisconsin statutes, the structure and remaining text of the statute (which is inclusive, not limiting), as well as the legislative intent behind the statute (to protect by law the rights of all individuals to obtain gainful employment and to enjoy privileges free from employment discrimination because of an arrest record).
Given its holding that a non-criminal offense is an “arrest record,” the Court next turned to the question of whether the District terminated the Cotas’ employment because of their arrest records. The Court found that substantial evidence[5] supported the Commission’s conclusion that the District terminated the Cotas’ employment because of their arrest records – i.e., the District’s decision to terminate the Cotas was motivated by their municipal theft citations and by the assistant city attorney’s statements that he believed he could convict the Cotas and could secure a settlement that included restitution.
The Court rejected the District’s argument that it was protected by the “Onalaska defense” – a defense that permits employment termination based on internal investigation findings – because the Commission found that the District relied on the Cotas’ arrest records.
Employer Takeaways
At the conclusion of its decision, the Wisconsin Supreme Court “clarified” that the Act does not prohibit terminating employees with arrest records; it prohibits terminating employees because of their arrest records. The District did not lose its ability to terminate the Cotas’ employment by referring the matter to the police, and it remained free to terminate the Cotas’ employment after that referral for any lawful reason. If the District believed that the Cotas were guilty independent of their arrest records, it could have terminated their employment based on that belief. However, substantial evidence supported the conclusion that the District terminated the Cotas’ employment – not because of the District’s belief in their guilt, but because of their arrest records.
This decision reminds Wisconsin employers to proceed with caution when making employment decisions regarding individuals with arrest records, as the Act protects even individuals with non-criminal arrests. If employers make employment decisions based on independent investigations, they must be prepared to defend those decisions. We expect that this decision will cause more individuals with arrest records to assert legal challenges in the face of adverse employment actions.
The author of this article, Patricia Tsipras, is a member of the Bar of Pennsylvania. This article is designed to provide one perspective regarding recent legal developments, and is not intended to serve as legal advice in Pennsylvania, Wisconsin, or any other jurisdiction, nor does it establish an attorney-client relationship with any reader of the article where one does not exist. Always consult an attorney with specific legal issues.
[1] The Cotas were members of the District’s grounds crew. As part of their duties, they, along with a coworker, Garret Loehrer, recycled scrap metal for the District. The local scrap metal processor paid with cash or checks made out to “cash.” Whoever received the money from the processor would give it to Gregory Cota, who would pass it along to his supervisor.
Over the years, the Cotas made multiple complaints to supervisors about Loehrer’s work performance. On one occasion, Jeffrey Cota asked a supervisor if Loehrer had turned in money from a recent scrap-metal delivery. Loehrer had turned in the money, but the supervisor relayed Cota’s inquiry to Loehrer. In response, Loehrer accused the Cotas of retaining some of the District’s scrap money.
[2] The District’s Director of Human Resources, Pam Casey, began a formal investigation into the allegations. Casey determined that the District did not receive over $5,000 originally paid to Loehrer and the Cotas. However, conflicting witness accounts prevented Casey from determining who was responsible for the missing funds.
[3] The municipal citations against the Cotas ultimately were dismissed. The Cotas never pleaded guilty to, or were convicted of, municipal theft.
[4] Under Wisconsin law, offenses punishable by fine, imprisonment, or both are crimes, while offenses punishable only by a forfeiture are noncriminal. Non-criminal offenses range from minor infractions, like failing to use a turn signal, to more serious violations, like a first operating-while-intoxicated (OWI) offense.
[5] “Substantial evidence” is the standard under which a court reviews an agency’s findings of fact. The test is “whether, after considering all the evidence of record, reasonable minds could arrive at the same conclusion” as the agency.
