Bridges v. Cavalier Corp.

• Decision Date: 15 July 1963
• Citation: 16 McCanless 237,212 Tenn. 237,369 S.W.2d 548
• Parties: Melvin Lee BRIDGES et al. v. CAVALIER CORPORATION. 16 McCanless 237, 212 Tenn. 237, 369 S.W.2d 548
• Court: Tennessee Supreme Court

Page 548

369 S.W.2d 548

Melvin Lee BRIDGES et al. v. CAVALIER CORPORATION.

16 McCanless 237, 212 Tenn. 237, 369 S.W.2d 548

Supreme Court of Tennessee.

July 15, 1963.

Ward Crutchfield, Glenn W. Brown, Chattanooga, for appellants.

Chambliss, Chambliss & Hodge, Chattanooga, for appellee.

BURNETT, Chief Justice.

This case involves the claims of the appellants for unemployment compensation under Sec. 50-1301 et seq., T.C.A. A Board of Review granted unemployment compensation. On certiorari the Chancellor reversed because a Texas case upon which the Board of Review granted this compensation had been reversed by the Supreme Court of Texas, and because our Act (Sec. 50-1349, subd. A, T.C.A.) which was partially the basis of such finding was not in point. The claimants have appealed.

The Cavalier Corporation, a soft drink bottling company, closed down for its annual two weeks' period, during which time the appellants did not work. In accordance with the provisions of the contract between the employees, who were represented by a Union, and the company the named appellants received vacation pay for this period. The rate of pay for vacation was, as follows:

Each employee who had completed more than one year of continuous service received an amount equal to forty hours at his straight time base rate with a shift differential included.

Each employee who had completed more than five years of continuous service received eighty hours at his straight time base rate with a shift differential included.

The individual appellants in this cause were paid for their two weeks' vacation at the rate of one-half pay during the two weeks period. In this case only men with less than five years' service are involved.

The appellants contend that they are entitled to unemployment compensation for the second week of their vacation while the company insists that they are not.

The bargaining agreement was entered into between the agent of the appellants, Allied Industrial Workers of America, AFL-CIO, Local Number 289, and the employer, Cavalier Corporation. Insofar as here applicable this agreement provides, as follows:

'ARTICLE S.

'PAID VACATIONS

'Section 1. An employee will be entitled to 1 week of vacation pay each year upon completion of 1 year of continuous service and 2 weeks of vacation pay each year upon completion of 5 years of continuous service.

'Each week of vacation pay will be for 40 hours at his straight time base rate with his shift differential included.

'A first-year employee will receive his vacation pay upon completion of his 12 months of continuous service or at the vacation period, whichever comes last. His vacation pay thereafter will be issued to him at the time his vacation is taken, or on the first pay period in July if no vacation is scheduled for that year.

'Section 2. Lay-offs because of business conditions will not disqualify an employee for vacation pay. If fire, explosion, or some other catastrophe beyond the Company's control, however, should shut down the plant for more than 3 months, vacations will not be payable.

'Section 3. The vacation period will be set by the Company to fall between June 15th and September 1st. Unless business reasons dictate a specific period the preference of the employees will be followed in choosing the vacation dates.

'The dates chosen will be announced not later than May 1st.

'Section 4. Vacations are not cumulative and must be taken, or paid for, during each calendar year. After an employee has qualified for vacation he shall be paid for any vacation due him if, for any reason, his services with the Company are terminated after the qualifying date. In case of death of the employee such payments will be made to his widow or his legal heirs or next of kin.'

Thus it is seen by this contract the company has the right to select the vacation period between June 15th and September 1st. The company complied with this provision and notices were sent out to the employees to the effect that the appliance plant vacation period would be from July 3rd to July 16th. It is also seen by a reading of this contract that the employee is entitled to one week of vacation pay upon the completion of a year of continuous service and upon the completion of five years of continuous service he is entitled to two weeks' vacation pay each year. The appellants here had not completed the required service with the company to entitle them to more than one week of vacation pay.

The Legislature in enacting the Employment Security Act (Sec. 50-1301 et seq., T.C.A.) in the interest of public welfare undertook to deal with the problem of involuntary unemployment. The declaration of policy in that Act is significant in the interpretation of the various provisions of the Act to which the ultimate result sought must be attained. Clearly, the Act was intended primarily for the benefit of those involuntarily unemployed; in other words, those who, capable of working, are prevented from doing so other than by the results of their own acts.

In the case now before us the appellants through their representative, a bargaining agent for the Union, entered into a definite agreement with the Cavalier Corporation that the vacation period each year, recognized by the parties as necessary or at least proper, should be between such and such dates, subject to certain provisions, and those having certain seniority should be entitled to such and others of other seniority to a different amount for their vacation. Those employees here, who are now appealing, received from $60.00 to $70.00 each for their vacation period. Such agreement was not for the sole benefit of the employer, but was primarily for the benefit of the employees. It is also observed from reading the portion of the contract above quoted that the fixing of the time for this annual vacation was not left to the employer alone but was due to a prior mutual agreement between the parties to be fixed between certain dates. A provision of the contract was made certain and definite to the end that the parties thereto, including the employees for whom the Union acted, might be apprised of their rights and obligations.

The Board of Review in cases of this kind under like circumstances has heretofore unflinchingly, or without waiver, held that appellants were not entitled to benefits, because they were estopped from claiming the benefits under the doctrine of equitable estoppel due to the fact they had held an election and agreed upon taking vacations as indicated by this contract and thus they were voluntarily unemployed during that time and could not come into court claiming benefits. The Board of Review recognizes the fact that this has been heretofore a unanimous holding of such Boards under facts of this kind, but they were cited to a Texas case in which the matter had been considered and the contrary held, which is the case of International Union of Electrical, Radio, and Machine Workers, Local Union No. 782, AFL-CIO v. Texas Employment Commission, as reported in Tex.Civ.App., 346 S.W.2d...