Abate v. Wheeling-Pittsburgh Steel Corp.

• Decision Date: 23 March 1998
• Docket Number: No. 97-BA-13,WHEELING-PITTSBURGH,97-BA-13
• Citation: 126 Ohio App.3d 742,711 N.E.2d 299
• Parties: ABATE et al., Appellees, v.STEEL CORP. et al., Appellants. *
• Court: Ohio Court of Appeals

Page 742

126 Ohio App.3d 742

711 N.E.2d 299

ABATE et al., Appellees, v. WHEELING-PITTSBURGH STEEL CORP. et al., Appellants. ^*

No. 97-BA-13.

Court of Appeals of Ohio Seventh District, Belmont County.

Decided March 23, 1998.

Timothy F. Cogan and Patrick S. Cassidy, Wheeling, WV, for appellees.

Felix C. Wade and David A. Kadela, Columbus, for appellant Wheeling-Pittsburgh Steel Corp.

Betty D. Montgomery, Attorney General, and Frank J. Reed, Assistant Attorney General, Columbus, for appellant Ohio Bureau of Employment Services.

James L. Messenger and Richard N. Selby, Youngstown, urging reversal for Manufacturing Association of Eastern Ohio and Western Pennsylvania.

COX, Judge.

This matter presents a timely appeal from a judgment rendered by the Belmont County Common Pleas Court modifying and reversing the decision of the Unemployment Compensation Board of Review denying claimants-appellees unemployment compensation during a labor dispute. There are over one thousand appellees, all of whom are employees of defendant-appellant Wheeling-Pittsburgh Steel Corporation ("WPSC"), a steel production plant located in Jefferson County, Ohio. As they are too numerous to name individually, claimants-appellees will be referred to collectively as "appellees" throughout this opinion.

Under a collective bargaining agreement, WPSC guaranteed appellees defined pension benefits upon retirement. In 1985, WPSC went bankrupt and terminated the defined-benefit pension plan ("DBP Plan") under an agreement with the Pension Benefit Guaranty Corporation ("PBGC"). The agreement replaced the DBP Plan with a defined-contribution plan and prohibited renewal of the DBP Plan until WPSC had been out of bankruptcy for five years. WPSC emerged from bankruptcy in 1991.

The United Steelworkers of America represented hourly employees at WPSC's Ohio Valley Plants in a series of collective bargaining agreements. WPSC and the union began negotiating the most recent of those agreements in 1994. Discussions centered on the importance of a DBP Plan. Union negotiators requested that a DBP Plan come into effect in 1996, when PBGC's five-year restriction on renewal lifted. Following a two-day strike, the parties reached a settlement and agreed to commence negotiations over a new pension arrangement in January 1996, the purpose of which was to implement a renewed DBP Plan. Effective March 1, 1994 to October 1, 1996, the 1994 agreement between the union and WPSC deliberately deviated from the customary four-year term to coincide with the lifting of PBGC's renewal restriction. The following contract provision, Article XIX, Section 19.4, entitled "Termination Date," represented the aforementioned negotiations:

"On or after November 15, 1995, either party may given 60 days' written notice of its desire to commence negotiations with respect to retirement benefits. Such negotiations may commence on January 15, 1996 or such later date upon which the parties mutually agree."

As intended, negotiations over retirement benefits began in January 1996, with a preliminary meeting to discuss pensions and the problems surrounding the issue. Contemporaneously, the union requested information from WPSC regarding appellees' accrued retirement benefits. In a letter dated June 11, 1996, Ronald LaBow of WPSC's parent company, WHX Corporation ("WHX"), wrote George Becker, the union's president, requesting a two-month extension of the 1994 agreement and rejecting a DBP Plan unless WHX acquired Teledyne Corporation. The letter explained:

"The reason for the requested extension relates to both the USWA demands for defined benefit pension plan * * * and to the uncertain status surrounding the Teledyne transaction. As discussed more fully at our meeting it is our strongly held belief that Wheeling-Pittsburgh cannot agree to a defined pension benefit plan and remain a competitive entity going forward, unless we complete the Teledyne or some similar type of transaction."

WHX never acquired Teledyne.

The union refused WHX's request and submitted written notice to WHX that indicated that the 1994 agreement would expire on October 1, 1996, as originally contemplated. Nevertheless, the union continued to stress the importance of a renewed DBP Plan and formally proposed a DBP Plan on September 5, 1996, at the first of seven main-table discussions.

The next main-table discussion occurred on September 17, 1996. Here, WPSC made its first pension proposal, offering to maintain the existing defined-contribution plan with significant increases and additional annuities. Several appellees testified that this proposal was not a permanent pension plan, in that it was good only under the Separation Incentive Plan of the 1994 agreement, a buyout plan.

Subsequent main-table discussions included talks on modified pension proposals, wage proposals, and orderly shutdown. WPSC's various pension proposals included increases in a defined-contribution plan, however, none considered a DBP Plan. Thus, not only did WPSC reject a DBP Plan ab initio, but it offered to extend only part of the 1994 agreement. WPSC's proposals considered extending the 1994 agreement only with respect to wages, not pensions.

The 1994 agreement expired on October 1, 1996. At 12:01 that morning, appellees walked off their jobs, refusing to work under existing conditions and insisting upon a DBP Plan.

Appellees filed for unemployment benefits. The matter was referred to a staff hearing officer of the Ohio Bureau of Employment Services ("OBES"). A hearing was conducted on November 4, 1996. On November 22, 1996, the hearing officer determined that appellees were not entitled to receive unemployment compensation because they were unemployed due to a labor dispute other than a lockout.

The Unemployment Compensation Board of Review disallowed an application for further appeal, and appellees then appealed to the Common Pleas Court. The lower court modified and reversed the board's decision as being contrary to law and allowed appellees' claim for unemployment compensation. This appeal followed.

At the outset, our standard of review on appeal must be discussed. R.C. 4141.28(O)(1) sets forth the standard of review to be applied in unemployment compensation cases and 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 such decision."

The Ohio Unemployment Compensation Act, R.C. 4141.01 et seq., "does not create distinctions between the scope of review of common pleas courts and appellate courts." Tzangas, Plakas & Mannos v. Ohio Bur. of Emp. Serv. (1995), 73 Ohio St.3d 694, 696-697, 653 N.E.2d 1207, 1210. In reviewing the board's decision, an appellate court must apply the same standard of review as the lower court. Thus, an appellate court may reverse the board's decision only if it is "unlawful, unreasonable, or against the manifest weight of the evidence." Id. at 697, 653 N.E.2d at 1210. The court shall not make factual findings or assess a witness's credibility. Id. at 696, 653 N.E.2d at 1210, quoting Irvine v. Unemployment Comp. Bd. of Review (1985), 19 Ohio St.3d 15, 19 OBR 12, 482 N.E.2d 587. The court may determine only whether the evidence supports the board's decision and, thus, shall not conduct a de novo review. Id. at 696-697, 653 N.E.2d at 1210-1211.

Additionally, an appellate court must review the lower court's decision to determine if it abused its discretion in ascertaining whether the board's decision was "unlawful, unreasonable, or against the manifest weight of the evidence." Pons v. Ohio State Med. Bd. (1993), 66 Ohio St.3d 619, 614 N.E.2d 748. "Abuse of discretion connotes more than an error of law or of judgment; it implies that the court's attitude is unreasonable, arbitrary or unconscionable." Tracy v. Merrell Dow Pharmaceuticals, Inc. (1991), 58 Ohio St.3d 147, 152, 569 N.E.2d 875, 880.

The sole assignment of error alleged by appellant OBES and the first assignment of error alleged by employer-appellant WPSC are similar in nature and therefore will be discussed together. They are as follows:

"The Common Pleas Court erred in reversing the Board of Review's decision that held the employees of Wheeling-Pittsburgh Steel Corporation were unemployed due to a labor dispute other than a lockout, when such decision was not unlawful, unreasonable or against the manifest weight of the evidence."

"The Common Pleas Court erred in finding that employees engaged in a work stoppage are presumed to be entitled to unemployment benefits and that their employer bears the burden of rebutting the presumption by proving that the work stoppage was brought about by a strike and not a lockout."

Appellants contend that the lower court incorrectly relied upon R.C. 4141.25 to support its position that appellees were presumed entitled to unemployment compensation. Appellants indicate that R.C. 4141.25 addresses employer contribution rates to unemployment trust funds, not benefit entitlement, and, thus, the lower court erred in relying on this provision. Furthermore, appellants argue that the lower court made a fundamental mistake by requiring WPSC to bear the burden of establishing that the unemployment was due to a labor dispute other than a lockout.

The objective of the Ohio Unemployment Compensation Act is to ameliorate the burdens on employees suffering from involuntary unemployment and to provide them with short-term financial relief. Baker v. Powhatan Mining Co. (1946), 146 Ohio St. 600, 33 O.O. 84, 67 N.E.2d 714. Baker stressed at 605, 33 O.O. at 87, 67 N.E.2d at 717:

"It was pursuant to the high purpose and praiseworthy design above stated that provision was made for the accumulation of a fund by means of contributions exacted from employers for the benefit of...