Opinion
No. 73-1476
Decided August 7, 1974.
Labor disputes — Eligibility for unemployment compensation — Burden of proof on claimant — R.C. 4141.29(D) (1)(a) disqualification applicable, when.
1. Where the original cause of unemployment is a labor strike, the claimant, to be eligible for unemployment compensation for weeks of unemployment following termination of the strike, has the burden of proof to establish his right to unemployment benefits without the disqualification of R.C. 4141.29(D)(1)(a) which denies benefits when the unemployment is the result of a labor dispute.
2. R.C. 4141.29(D)(1)(a), as amended in 1963, provided that no employee whose unemployment was due to a labor dispute other than a lockout at any establishment owned or operated by his employer would be eligible to receive unemployment compensation benefits for so long as such labor dispute was in progress.
3. The 1963 amendment to R.C. 4141.29(D)(1)(a) developed an entirely new approach to the question of how long employees, whose unemployment was due to a labor dispute, would remain ineligible to receive unemployment compensation benefits. Rather than an inflexible standard, the application of which would apply to all employees in a given plant or establishment, such as when the labor dispute ended or when a reasonable period of time necessary to allow the factory to resume normal operations had expired, the legislature adopted a more flexible guideline, to wit: that ineligibility would continue for as long as the unemployment is due to a labor dispute. This approach requires a case by case, situation by situation, employee by employee, department by department analysis of the unemployment in question and a determination by the Referee (or other hearing officer) as to whether or not this employee's continued unemployment was due to the labor dispute in question or to other unrelated causes. This statutory guideline will favor neither management nor labor and will allow an objective analysis of each case, or group of cases, upon its own merits with the full consideration given to the nature of the employee's specific job measured against the employer's efforts to ready his plant to resume operations. Under the present state of the law, existing since October, 1963, the employer must be held to a standard of reasonableness. In other words, if the employer does need time to resume operations in a specific department, the hearing officer will examine this claim and determine if same be reasonable. If so, the employee's ineligibility to receive benefits will be extended accordingly. If not, the ineligibility will cease forthwith.
Mr. Ray E. Schmidt, for claimants-appellants.
Mr. Lawrence S. Falter, for employer-appellee.
Mr. Richard Austin, for appellee.
The captioned cause came on to be heard upon the appeal of the claimants-appellants from a decision of the referee of the board of review, reversing the administrator's decision on reconsideration and disallowing Unemployment Compensation to the claimants-appellants, from which the board of review disallowed claimants-appellants' application to institute a further appeal.
Upon due consideration and for the reasons given in the following discourse, the court denies the appeal of the claimants-appellants and does, therefore, affirm the decision of the referee of the board of review and thus denies unemployment compensation to the claimants-appellants for the period in question.
The claimants became unemployed because of a strike at the National Cash Register Company which began on October 11, 1971. Following the signing of the labor-management contract, the claimants-appellants (approximately 10% of the employer's work force) were not immediately recalled to work due to the shortage of raw materials and parts on hand, both of which had become depleted during the strike. Prior to and during the pendency of the strike, the company made certain moves to minimize its losses due to the strike by means of shipping raw materials to other plants not affected by the strike. These moves were made to protect certain raw material and to fill as many orders as possible. The claimants-appellants were recalled to work as their services were required for the orderly resumption of production. These claimants-appellants have sought unemployment compensation for the period of time between the signing of the labor-management contract, signifying the end of the strike, and their being recalled to work.
The case of Leach v. Republic Steel Corp. (1964), 176 Ohio St. 221, cited by the employer-appellee, is not controlling in the case at bar. That case, construing a predecessor of R.C. 4141.29(D)(1)(a), must be strictly limited to its facts. The applicable portion of R.C. 4141.29(D)(1)(a), in existence at the time of the Leach decision, stated, in pertinent part:
"(D) * * * no individual may * * * be paid benefits under the following conditions:
"(1) For any week with respect to which the Administrator finds that:
"(a) His unemployment was due to a labor dispute * * * and for so long as such labor dispute continues." (Emphasis added.)
A careful reading of the second paragraph of the syllabus in Leach, which states: "Where a labor dispute between an employer and his employees over wages and conditions of employment results in a strike which closes the employer's establishment, and the strike itself is summarily ended by court injunction, no unemployment compensation is payable to an employee from the end of the strike until he is recalled to work after the employer's establishment is readied for resumption of operations, where such dispute is in progress during such period and for some time thereafter" (emphasis added), together with the facts of that case, reveal that the Leach holding applied strictly to the emphasized portion of the syllabus.
The Leach court only held that, under the facts of the case before them, the labor dispute had not ended at any time prior to the employees being called back to work by the employer. In other words, even though the strike itself was ended by court order, the labor dispute itself, and the negotiations designed to bring it to a conclusion, still continued and did not end until after such time as the employees had been called back to work following the employer's readying its plant for resumption of operations. Since the labor dispute continued, the Leach court held that the employees were not entitled to benefits for the period between the court-ordered end of the strike and the resolution of the labor dispute, evidenced by the signing of the labor-management contract.
The Leach case does not hold, and is not authority for the proposition, that an employee is never eligible for unemployment compensation benefits until the expiration of a reasonable time following the end of the strike for the employer to ready its plant for resumption of operations.
The meaning of statutory language can often be determined by an examination of the legislative history of the particular statutory section in question. In the instant case, the pertinent statutory section, applicable at the time of the events in question and presently, is R.C. 4141.29(D)(1)(a). This section states, in pertinent part:
"(D) * * * no individual may * * * be paid benefits * * *:
"(1) For any week with respect to which the Administrator finds that:
"(a) His unemployment was due to a labor dispute * * * and for so long as his unemployment is due to such labor dispute." (Emphasis added.)
The above-quoted statutory language has remained the same since the October 20, 1963 effective date of the then newly amended Revised Code Section 4141.29(D)(1)(a). Prior to that time, the statutory language under discussion read, as follows:
1) Effective October 30, 1953, R.C. 4141.29 (C)(2) — "Lost his employment * * * by reason of a labor dispute * * * as long as such labor dispute continues." (Emphasis added.)
2) Effective October 2, 1955, R.C. 4141.29(C)(2) — "Lost his employment * * * by reason of a labor dispute * * * as long as such labor dispute continues, and thereafter for a reasonable period of time necessary for such factory or establishment to resume normal operations." (Emphasis added.)
3) Effective October 16, 1959, R.C. 4141.29(D)(1)(a) — "His unemployment was due to a labor dispute * * * and for so long as such labor dispute continues." (Emphasis added.)
4) To repeat, effective October 20, 1963 to date — "His unemployment was due to a labor dispute * * * and for so long as his unemployment is due to such labor dispute." (Emphasis added.)
Applying two basic rules of statutory construction, towit: 1) If a statute is plain and unambiguous, the court must give it the literal interpretation intended by the legislature, without limiting it in any extent or extending its operations, and 2) The legislature will not be assumed to have done a vain or a useless act in amending a statute and that such amendment must be analyzed both in the light of the changes made by the amendment from prior language and in the light of case law construing the statute that may have influenced the legislature to amend the section in question, this court makes the following conclusions with reference to the language under discussion:
1) The 1953 amendment was designed to remove the ineligibility for benefits as of the time the labor dispute ended. Presumably, applying the plain-meaning approach, this would mean as of the time a contract was signed between management and the union.
2) The 1955 amendment was designed to extend the period of ineligibility beyond the signing of the contract, itself, to a reasonable period after the end of the labor dispute necessary to enable management to ready its plant to resume normal operations. This was an amendment, management-oriented in nature, designed to not penalize the company for the labor dispute by requiring it to either bring back their employees or to pay benefits prior to the plant's becoming geared up for business following the resolution of the labor dispute. Although not penalizing management for the labor dispute, this amendment did have the effect of penalizing the employees by virtue of the fact that it extended their ineligibility for benefits beyond the end of the dispute.
3) The deletion of the language in the 1959 amendment concerning the ineligibility to receive benefits for a reasonable period of time necessary to enable the factory or establishment to resume operations, thus marking a return to the statutory language in existence from 1953 to October 1955, clearly shows that the legislature, perhaps more sympathetic to labor than its predecessor, intended to remove the disqualification or ineligibility for benefits for the period of time necessary to get the factory back to normal operations, regardless of the fact that there would have been no delay in normal production had there been no labor dispute. Once again, one's ineligibility to receive benefits would end as of the termination of the labor dispute (the signing of the contract or other objective indication that the labor dispute had terminated). This amendment was more labor-oriented than the prior amendment, and while it did not penalize the employee for the labor dispute (making him ineligible to receive benefits as soon as the labor dispute had ended) it could have had the effect, in theory, of penalizing management by requiring the payment of benefits to their employees because of their inability to put them back to work immediately.
It is interesting to note that the Leach decision, supra, was based upon the 1959 amendment, holding, perhaps too literally, that even though the strike had been ended by court order, the labor dispute continued until the signing of the labor-management contract, some two months later, and the employees were thus ineligible to receive benefits until that time.
4) After years of first going one way and then the other, after years of operating under a statutory scheme that invariably punished or penalized either management or labor for the labor dispute, the legislature, in 1963, perhaps as a reaction to the Leach case's judicial interpretation of the 1959 Act, developed an entirely new approach to the question of how long employees, whose unemployment was due to a labor dispute, would remain ineligible to receive unemployment compensation benefits. Rather than an inflexible standard, invariably unfair to management or labor, the application of which would apply to all employees in a given plant or establishment, such as when the labor dispute ended or when a reasonable period of time necessary to allow the factory to resume normal operations had expired, the legislature adopted a more flexible guideline, to-wit: that ineligibility would continue for so long as the unemployment is due to a labor dispute. This approach requires a case by case, situation by situation, employee by employee, department by department analysis of the unemployment in question and a determination by the referee (or other hearing officer) as to whether or not this employee's continued unemployment was due to the labor dispute in question or to other unrelated causes. This statutory guideline will favor neither management nor labor and will allow an objective analysis of each case, or group of cases, upon its own merits with the full consideration given to the nature of the employee's specific job measured against the employer's efforts to ready his plant to resume operations. Under the present state of the law, existing since October 1963, the employer must be held to a standard of reasonableness. In other words, if the employer does need time to resume operations in a specific department, the hearing officer will examine this claim and determine if same be reasonable. If so, the employee's ineligibility to receive benefits will be extended accordingly. If not, the ineligibility will cease forthwith.
Based upon the foregoing discussion, the court holds that the referee's conclusion that the unemployment of the claimants-appellants, after the signing of the labor-management contract, was due to a "labor dispute" is not, therefore, contrary to law.
It now remains to be seen whether such decision was unreasonable and against the manifest weight of the evidence.
R.C. 4141.28 (O) states as follows:
"* * * If the court finds that the decision was unlawful, unreasonable, or against the manifest weight of the evidence, it shall reverse and vacate such decision or it may modify such decision and enter final judgment in accordance with such modification; otherwise such court shall affirm the decision. * * *"
The court's function in appeals of this nature is limited:
"A Common Pleas Court may not substitute its judgment for that of the board of review (or referee), Bureau of Unemployment Compensation, on factual issues and may modify the board's decision and enter final judgment only where the facts are not in dispute and such undisputed facts constitute substantial, credible evidence of probative value on the issues to be determined." Fahl v. Board of Review (1965), 2 Ohio App.2d 286.
"In an appeal from a decision of the Unemployment Compensation Board of Review under Section 4141.28, Revised Code, to the Common Pleas Court, the jurisdiction of the court is limited to a determination of whether such decision was unlawful, unreasonable or against the manifest weight of the evidence." Kilgore v. Board of Review (1965), 2 Ohio App.2d 69.
In the captioned cause, the referee concluded as follows:
"Claimants became unemployed because of a strike which began on October 11, 1971. The Dayton plant was the source of parts for other plants of The National Cash Register Company at which no labor dispute existed. Nonbargaining unit employees of the Dayton plant continued to work after the strike began on October 11, 1971. They made urgently needed parts and shipped parts from the existing supply to other National Cash Register plants and to customers. They also moved some parts from the assembly line to protective storage for the duration of the strike.
"On January 29, 1972, an agreement was reached between The National Cash Register Company and the United Auto Workers and its Local No. 1616, to be effective January 31, 1972. On January 31, 1972, the supply of raw material and parts was so depleted that it was not feasible to immediately resume full production and immediately recall all employees for work. Employees were recalled to work as their services were required for the orderly resumption of production.
"The evidence established that it was not feasible for National Cash Register Co., Inc., to resume full production with a full compliment of employees on January 31, 1972, because of the short supply of raw material and parts. A preponderance of the evidence indicates that the short supply of raw material and parts was due to the strike at the premises during the period October 11, 1971 to January 31, 1972.
"In view of the foregoing, it must be concluded that the unemployment of each of the claimants during the week in issue in each case was due to a labor dispute at National Cash Register Co., Inc."
Based upon a thorough reading of the transcript and supporting documents, and based upon the foregoing principles of law setting forth the court's jurisdiction with regard to the facts and matters such as the instant case, this court concludes that the referee's conclusions were neither unreasonable nor against the manifest weight of evidence. Accordingly, the court adopts these findings of fact by the referee as its own.
A company has the legal right to attempt to minimize its losses during a strike by protecting its materials and attempting to fill as many orders as possible. Should such actions result in some unemployment after the end of the strike, while the plant readies itself to resume full operations, the taking of the necessary actions during the strike cannot be held to penalize the company.
The law of Ohio is very clear that "[T]he burden of proof is upon the claimant to establish the right to unemployment benefits under the unemployment compensation law of Ohio." Shannon v. Bureau of Unemployment Compensation (1951), 155 Ohio St. 53.
Where the original cause of unemployment is a labor strike, the claimant, to be eligible for unemployment compensation for weeks of unemployment following the termination of the strike, has the burden of proof to establish the right to unemployment benefits without the disqualification of Section 4141.29(D)(1)(a) which denies benefits when the unemployment is the result of a labor dispute.
"It is the duty of a party on whom the burden of proof rests to produce evidence which furnishes a reasonable basis for sustaining his claim. If the evidence so produced furnishes only a basis for a choice among different possibilities as to any issue in the case, he fails to sustain such burden." Stevens v. Indus. Comm. (1945), 145 Ohio St. 198.
In the captioned cause, the claimants-appellants have failed to sustain their burden of proof.
The court might state, parenthetically, that cases from other jurisdictions are, generally speaking, of an academic interest only in that the pertinent statutes of such other states often vary considerably from the specific Ohio statute under discussion.
WHEREFORE, for the reasons given above, this court denies the appeal of the claimants-appellants, affirms the decision of the referee of the board of review and denies the right of the claimants-appellants to unemployment compensation benefits for the period in question.
Judgment accordingly.