Aragon v. UNEMPLOYMENT COMPENSATION COMMISSION, ETC.

• Decision Date: 15 May 1945
• Docket Number: No. 10425.,10425.
• Citation: 149 F.2d 447
• Parties: ARAGON et al. v. UNEMPLOYMENT COMPENSATION COMMISSION OF TERRITORY OF ALASKA et al.
• Court: U.S. Court of Appeals — Ninth Circuit

149 F.2d 447 (1945)

ARAGON et al. v. UNEMPLOYMENT COMPENSATION COMMISSION OF TERRITORY OF ALASKA et al.

No. 10425.

Circuit Court of Appeals, Ninth Circuit.

May 15, 1945.

Andersen & Resner, George R. Andersen, and Herbert Resner, all of San Francisco, Cal., for appellants.

E. Coke Hill, of San Francisco, Cal., for appellees Unemployment Compensation Commission of Territory of Alaska.

Marshall P. Madison, Francis R. Kirkham, Melvin E. Mensor, and Pillsbury, Madison & Sutro, all of San Francisco, Cal., and Faulkner & Banfield, of Juneau, Alaska, for appellees Alaska Packers Ass'n et al.

Before DENMAN, HEALY, and BONE, Circuit Judges.

DENMAN, Circuit Judge.

This is an appeal from a judgment of the District Court of the United States for the Territory of Alaska, rendered in a proceeding to review a decision of the Unemployment Compensation Commission of the Territory. Under the Alaska Unemployment Compensation law¹ appellant employees, hereafter called appellants, were admittedly entitled to unemployment compensation from the Commission for the several months' period fixed by the Commission's Regulation 10 of the fishing season of 1940 at the fishing and canning plants of the appellee corporations, hereafter called Canners, at Chignik, Karluk and Bristol Bay, Alaska.

The beneficent purpose of the Unemployment Compensation Law of Alaska is stated in its "Declaration of Territorial Public Policy," as follows:

"Economic insecurity due to unemployment is a serious menace to the health, morals and welfare of the people of this Territory. Involuntary unemployment is therefore a subject of general interest and concern which requires appropriate action by the Legislature to prevent its spread and to lighten its burden which now so often falls with crushing force upon the unemployed worker and his family. The achievement of social security requires protection against this greatest hazard of our economic life. * * *"

The question here for determination is whether eight weeks' time should be deducted from the admitted period of unemployment and appellants' awards reduced by the compensation otherwise due for that period by reason of a claimed labor dispute in active progress for the eight weeks at the "factory, establishment or other premises" of the Canners, within the meaning of an exceptive provision of the Act, as follows:

"Section 5. Disqualification for Benefits. An individual shall be disqualified for benefits:

* * * * *

"(d) For any week with respect to which the Commission finds that his total or partial unemployment is due to a labor dispute which is in active progress at the factory, establishment or other premises at which he is or was last employed; provided, that such disqualification shall not exceed the 8 weeks immediately following the beginning of such dispute; * * *."

Such an exception to the beneficence of the Act must be strictly construed. In the recent case of A. H. Phillips, Inc. v. Walling, 65 S.Ct. 807, that Court considered the question of the rule of construction of the word "establishment" in a similar exception to the Fair Labor Standards Act of 1938, 52 Stat. 1060, 1067, 29 U.S.C. § 213(a) (2), 29 U.S.C.A. § 213(a) (2), that the wage and hour provisions of the Act shall not apply with respect to "`any employee engaged in any retail or service establishment the greater part of whose selling or servicing is in intrastate commerce.' The issue posed by this case is whether employees working in the warehouse and central office of an interstate grocery chain store system are `engaged in any retail * * * establishment' within the meaning of Section 13(a) (2) so as to be exempt from the wage and hour provisions."

The Court states the rule of construction of exceptions to such humanitarian and remedial legislation, as here the Alaska Compensation Law is declared to be, as follows:

"The Fair Labor Standards Act was designed `to extend the frontiers of social progress' by `insuring to all our able-bodied working men and women a fair day's pay for a fair day's work.' Message of the President to Congress, May 24, 1934. Any exemption from such humanitarian and remedial legislation must therefore be narrowly construed, giving due regard to the plain meaning of statutory language and the intent of Congress. To extend an exemption to other than those plainly and unmistakably within its terms and spirit is to abuse the interpretative process and to frustrate the announced will of the people. We accordingly agree with the two courts below that the exception contained in Section 13(a) (2) is inapplicable in this case and that the employees involved are entitled to the benefits of the wage and hour provisions of the Act. We hold, in other words, that the warehouse and central office of petitioner's chain store system cannot properly be considered a retail establishment within the meaning of Section 13(a)(2)."

In so holding, the Supreme Court states that "Prior to the adoption of the Fair Labor Standards Act the term `establishment' was used in the sense of physical place of business by many census reports, business analyses, administrative regulations, and state taxing and regulatory statutes. * * *" (Emphasis supplied.)

Prior to the Phillips decision this circuit held in Canadian Pac. R. v. United States, 9 Cir., 73 F.2d 831, 834, a similar strict construction of a proviso excepting certain carriers from liability for overtime pay to employees of the Emigration Service under the Act of March 2, 1931, 8 U.S.C.A. § 109a, and in Reynolds v. Salt River Valley Assn., 9 Cir., 143 F.2d 863, 868 with reference to an exception to the Fair Labor Standards Act. See also same holding regarding excepting provisos in Fair Labor Standards Act in Eighth, Third and First Circuits: Fleming v. Hawkeye Button Co., 8 Cir., 113 F.2d 52, 57; Fleming v. A. B. Kirschbaum, 3 Cir., 124 F.2d 567, 572; Calaf v. Gonzalez, 1 Cir., 127 F.2d 934.

It is obvious that a workman seeking to recover under the Alaska Act would not be denied recovery unless, in addition to his unemployment, he also proved that he had no "disqualification for benefits." We have held that the burden of proving that an unemployed person, otherwise entitled to the compensation, is deprived of it by reason of falling within the exception is upon the party asserting it, here the appellees. Canadian Pac. R. v. United States, supra; Reynolds v. Salt River Valley Assn., supra; Schlemmer v. Buffalo, Rochester etc. R., 205 U.S. 1, 11, 27 S.Ct. 407, 51 L.Ed. 681.

It does not deed the application of the rule of strict construction to construe the words "factory" and "establishment" placed before the words "or other premises" in Section 5(d) of the Alaska Act as ejusdem generis with the concluding phrase and that the principle of noscitur a sociis applies. Strict construction would require such a construction as the Supreme Court made of the word "establishment" in a similar exception, supra, as the "physical place." Webster's New International Dictionary, Second Edition, 1940, defines the word "premises," the plural of the word "premise," as

"Premise * * * 4. pl. Law. The property conveyed in a deed; hence, in general emphasis ours, a piece of land or real estate; sometimes, esp. in fire-insurance papers, a building, or buildings on land; as, to lease premises; the premises insured. Sometimes loosely applied to personal property, as a vessel."

The question then is whether appellees have established their burden of proof that there was a labor "dispute which is in active progress at the factory, establishment or premises at which he is or was last employed."

The three appellee corporations, called the Canners, maintain salmon fishing and canning establishments in Alaska at Chignik, Karluk and Bristol Bay. The establishments consist of canning factories and the premises surrounding them with quarters for the fishermen and canners, fishing boats and housing for the supplies and equipment of the establishments and their employees. Appellants, over 1300 men, residing in California, had been the employees of the Canners at these establishments in the previous fishing season of 1939. They had been carried to San Francisco on the vessels chartered or owned by the Canners. Their employment, as shown by paragraph 15 of the 1939 agreement between the Canners and the appellants, began when the employees boarded the vessels bound for Alaska and terminated on arrival of the vessels on return to San Francisco, unless leaving the employment in Alaska.²

Appellants were last employed under their contract for the 1939 fishing seasons in Alaska. In that contract there are 37 paragraphs with over a hundred agreements between the 1300 employees and the Canners concerning the rates of pay, overtime, food, housing, racial discrimination, and numerous other relations of the employers and employees in the canning and fishing establishments in Alaska and on board the vessels. Any one of these agreements well may have produced a labor dispute at the establishments or on the vessels or adjacent thereto. Section 5(d) excepts the employees in all of these possible hundreds of labor disputes from the compensation of the Act for a maximum of 8 weeks. There is no merit to the contention that the exceptive section 5(d) must be intended to include disputes other than "at" such premises to give meaning and effect to the compensation Act.

The Canners' and the Commission's brief attempt to meet appellants' contention only by an inferential treatment of Section 5(d) as if the words "at the factory," etc. were to be stricken from their place after the words "active progress" and transposed above in the paragraph after the word "unemployment." With such striking and transposing the paragraph would appear

"For any week with respect to which the Commission finds that his total or partial unemployment — at the factory, establishment or other premises at which he is or was last employed — is due to...