Campos v. Employment Development Dept.

• Decision Date: 21 June 1982
• Docket Number: BRENDLIN-RICE
• Parties: Engracia CAMPOS, et al., Plaintiffs and Appellants, v. CALIFORNIA EMPLOYMENT DEVELOPMENT DEPARTMENT, et al., Defendants and Respondents.COMPANY, et al., Real Parties in Interest and Respondents. Civ. 53077.
• Court: California Court of Appeals Court of Appeals

Page 637

183 Cal.Rptr. 637

132 Cal.App.3d 961

Engracia CAMPOS, et al., Plaintiffs and Appellants, v. CALIFORNIA EMPLOYMENT DEVELOPMENT DEPARTMENT, et al., Defendants and Respondents.

BRENDLIN-RICE COMPANY, et al., Real Parties in Interest and Respondents.

Civ. 53077.

Court of Appeal, First District, Division 4, California.

June 21, 1982.

Hearing Denied Sept. 22, 1982.

Richard M. Pearl, Nancy Sams, California Rural Legal Assistance, San Francisco, Timothy H. McCarthy, California Rural Legal Assistance, Salinas, W. Kenneth Rice, California Rural Legal Assistance, Santa Maria, for plaintiffs and appellants.

George Deukmejian, Atty. Gen., Thomas E. Warriner, Asst. Atty. Gen., Charlton G. Holland, Deputy, San Francisco, for defendants and respondents.

Littler, Mendelson, Fastiff & Tichy, George J. Tichy, II, John M. Skonberg, Richard N. Hill, San Francisco, for real parties in interest John Inglis Frozen Foods Co. and Spiegl Foods, Inc.

CHRISTIAN, Associate Justice.

Engracia Campos and others appeal from a judgment denying administrative mandamus and other relief connected with claims by appellants for unemployment benefits. Benefits were terminated by the Employment Development Department on the ground that appellants, former employees of real parties Brendlin-Rice Company and others, had left their work because of a trade dispute. More than 100 claimants, including each of the present appellants, took an administrative appeal from this determination. An administrative law judge upheld the termination of benefits; that decision was adopted by the Unemployment Insurance Appeals Board.

Appellants sought a writ of administrative mandamus (Code Civ.Proc., § 1094.5) on their own behalf and injunctive relief, declaratory relief, traditional mandamus (Code Civ.Proc., § 1085), and relief from deprivation of civil rights (42 U.S.C. § 1983) on behalf of themselves and all others similarly situated. All parties made motions for summary judgment. The court granted summary judgment adverse to the claimants and the present appeal followed.

Appellants were employed on a seasonal basis by real parties in interest John Inglis Frozen Food Company and Spiegl Foods, Inc., who were frozen food processors. Brendlin-Rice Company and Knudsen Frozen Foods, two of the real parties in interest, were purchased by Spiegl in 1975. The industry is seasonal: the number of workers needed fluctuates throughout the year on the basis of crop availability. By late August 1976, each of the appellants had been indefinitely laid off for varying periods of time. As unemployed workers they were receiving unemployment insurance benefits.

The workers in the employers' plants, including appellants, were members of Teamsters union locals and were covered by collective bargaining agreements. The agreements provided for a system of recalling laid-off workers according to seniority, i.e., the first employees hired would be the last laid off and the first to be recalled. These agreements were still in effect on August 26, 1976, when a strike was called by several local unions in a trade dispute connected with contract negotiations. The employees who were working at the plants at the time walked out and picket lines were established.

Shortly after the strike commenced, the employers telephoned every worker on the seniority lists and offered them work. The Brendlin-Rice Company and Knudsen seniority lists were merged into the Spiegl list in June 1976. The Spiegl list consisted of 610 potential employees and the Inglis list of 450 names. The telephone recall offers were followed by written confirmation which indicated that work was available "every day until further notice." These confirmations were sent on September 3, 1976, to all of the people on the employers' seniority lists. Almost all the employees rejected the recall offers. Some of the appellants testified that they refused to return to work because they were afraid, or merely did not want to, cross picket lines. Many of the laid-off workers were not involved in picketing but others participated in the picket lines and received strike benefits in return for their participation. The strike was settled on October 2, 1976.

The question presented by this appeal is whether workers on indefinite layoff are disqualified from receiving unemployment benefits when they refuse to accept recall offers in the course of a trade dispute. Two statutes bear on this question: One provides that "[a]n individual is not eligible for unemployment compensation benefits, and no such benefits shall be payable to him, if he left his work because of a trade dispute. Such individual shall remain ineligible for the period during which he continues out of work by reason of the fact that the trade dispute is still in active progress in the establishment in which he was employed." (Unemp.Ins.Code, § 1262 [sometimes referred to as "the striker provision"]. Emphasis added.) The courts have recognized a two-part test of ineligibility under this section: (1) the worker must voluntarily leave or remain away from his employment (a volitional test) and (2) the worker must leave or remain away from his employment because of a trade dispute (a causational test). (Ruberoid Co. v. California Unemp. Ins. Appeals Board (1963) 59 Cal.2d 73, 77, 27 Cal.Rptr. 878, 378 P.2d 102.) The striker disqualification is applied only where the employee is "personally responsible" for his absence from work. In making this determination, courts have relied on such factors as union membership, identity of interest in the dispute, whether work was actually available during the strike, picketing activities and receipt of strike benefits. (See Chrysler Corp. v. California Unemp. Ins. Appeals Board (1962) 199 Cal.App.2d 683, 688, 18 Cal.Rptr. 843; Chrysler Corp. v. Calif. Emp. etc. Com. (1953) 116 Cal.App.2d 8, 16, 253 P.2d 68; Bodinson Mfg. Co. v. California E. Com. (1941) 17 Cal.2d 321, 328, 109 P.2d 935.)

Respondents contend that section 1262 is dispositive of the issue of disqualification. This view, however, ignores another enactment which provides, in pertinent part, that: "Notwithstanding any other provisions of this division... benefits shall not be denied to any otherwise eligible and qualified individual for refusing new work.... (a) If the position offered is vacant due directly to a strike, lockout, or other labor dispute." (Unemp.Ins.Code, § 1259 [sometimes referred to as "the strikebreaker provision"].) Appellants contend that where workers are recalled from indefinite layoff, the work they are offered is "new work." On that basis they claim coverage under section 1259 and exemption from the ineligibility created by section 1262.

A brief review of the federal-state structure of unemployment insurance will form a useful context for discussion of the issue. The unemployment insurance program was initiated in 1935 by the Social Security Act. (26 U.S.C. § 3301; 42 U.S.C. § 501 et seq., § 1101 et seq.) That act imposed a tax on employers that each state could mitigate by establishing its own unemployment insurance program meeting federal guidelines. (26 U.S.C. § 3301 et seq.) Although "Congress intended the several States to have broad freedom in setting up the types of unemployment compensation they wish[ed,]" it also directed each state to meet certain fundamental requirements for approval of the state plans. (New York Tel. Co. v. New York Labor Dept. (1979) 440 U.S. 519, 537-538, 543 fn.42, 99 S.Ct. 1328, 1339-1340, 1343 fn.42, 59 L.Ed.2d 553; Ohio Bureau of Employment Services v. Hodory (1977) 431 U.S. 471, 488, 97 S.Ct. 1898, 1908, 52 L.Ed.2d 513.)

Among the provisions to which a state unemployment statute must conform in order to qualify for federal approval is the following which is closely followed by California Unemployment Insurance Code section 1259, the statute at issue here: "[C]ompensation shall not be denied in such State to any otherwise eligible individual for refusing to accept new work...: (A) if the position offered is vacant due directly to a strike, lockout, or other labor dispute...." (26 U.S.C. § 3304(a)(5)(A).)

The United States Department of Labor is the federal agency responsible for ensuring that state unemployment laws comply with the mandatory federal criteria set out by Congress. (26 U.S.C. § 3304; 42 U.S.C. § 503.) Since section 1259 of the California Unemployment Insurance Code is mandated by the federal statute, interpretations of the federal statute by federal agencies such as the Department of Labor, although not binding on the courts, are entitled to great weight. (Brennan v. Owensboro-Daviess C. Hosp., etc. (6th Cir. 1975) 523 F.2d 1013, 1028, cert. den. 425 U.S. 973, 96 S.Ct. 2170, 48 L.Ed.2d 796.)

In its Unemployment Insurance Program Letter No. 984 (1968), the Department of Labor considered the application of the term "new work" to the situation of workers whose current employers offer new positions under less favorable working conditions. ¹ The Program Letter stated: "[A]n offer of new work includes... an offer of re-employment to an unemployed individual by his last (or any other) employer with whom he does not have a contract of employment at the time the offer is made.... The question is whether the offer of re-employment is an offer of a new contract of employment. If the worker... was discharged or laid off indefinitely, the existing contract of employment was thereby terminated. An indefinite layoff, that is a layoff for an indefinite period with no fixed or determined date of recall, is the equivalent of a discharge."

Respondents argue that work offered by a claimant's last employer is not new work; in rejecting this interpretation, the letter continued: "[I]f the phrase 'new work' were limited to work with an employer for whom the individual has never worked, it is plain that the purpose of section 3304(a)(5) would be largely nullified. It can make no difference, insofar as that...