General Motors Corp. v. Michigan Unemployment Compensation Commission, 8

• Decision Date: 01 October 1951
• Docket Number: No. 8,8
• Citation: 331 Mich. 303,49 N.W.2d 305
• Parties: GENERAL MOTORS CORP. v. MICHIGAN UNEMPLOYMENT COMPENSATION COMMISSION et al.
• Court: Michigan Supreme Court

Page 305

49 N.W.2d 305

331 Mich. 303

GENERAL MOTORS CORP. v. MICHIGAN UNEMPLOYMENT COMPENSATION COMMISSION et al.

No. 8.

Supreme Court of Michigan.

Oct. 1, 1951.

Frank G. Millard, Atty. Gen., Edmund E. Shepherd, Solicitor Gen., Lansing, George M. Bourgon, Asst. Atty. Gen., for defendant.

Henry M. Hogan, Detroit (E. V. Gilliland, Detroit, of counsel), for plaintiff and appellee.

Zwerdling & Zwerdling, Detroit, for defendants and appellees.

Before the Entire Bench, except BUTZEL, J.

NORTH, Justice.

The 317 defendant-claimants, whose right to unemployment compensation are herein involved, were full time hourly employees of the General Motors Corporation in its plants located in the Saginaw-Bay City area. The corporation's 1948 annual inventory, pursuant to posted notices, was taken during the week ending December 25. During that week there was one day's employment for 77 of these claimants, but no employment for 240 of them. All of claimants returned to work on Monday, December 27, when normal production and employment were resumed. On December 30, 1948, pay day, each claimant was paid his regular wages for eight hours straight time as and for his Christmas 'holiday pay,' pursuant to sections 138 to 143, inclusive, of an agreement dated May 29, 1948, between the corporation and the UAW-CIO, as bargaining agent for claimants. Section 86 of that agreement provided for double time payment to employees who work on Christmas days. Right to full unemployment compensation for the week of the inventory layoff is sought by 240 of the claimants, but resisted by the employer corporation. The sole question presented is: 'Did claimants earn remuneration with respect to the week ending December 25, 1948, within the meaning of section 27 (c-1) of the Michigan unemployment compensation act ¹ by virtue of having received 'holiday pay' pursuant to sections 138 through 143 of the agreement between General Motors Corporation and the UAW-CIO dated May 29, 1948.'

The referee and the appeal board held that with respect to the week ending December 25, 1948, these claimants earned no remuneration within the meaning of the statutory provisions notwithstanding they received 'holiday pay' for December 25, included in the pay each received December 30, 1948; such payment being in accord with the agreement of May 29, 1948, entered into between the corporation and the UAW-CIO as claimants' bargaining agent.

In accord with statutory procedure the controversy finally reached the circuit court of Ingham county, which reversed the decision of the appeal board of the Michigan unemployment compensation commission. The circuit court held that by receipt of 'holiday pay' for December 25, 1948, the claimants herein did receive to that extent remuneration during the week ending December 25, 1948. We quote the following from the opinion of the circuit judge:

'Was the decision of the Appeal Board contrary to law in holding that claimants did not earn remuneration with respect to the week ending December 25, 1948, by virtue of receiving holiday pay for December 25, 1948, pursuant to the holiday pay section of the 1948 agreement. * * *

'First, it seems to this court that the remuneration the claimants received from the Corporation was for meeting the eligibility rules under the contract, which in part at least require personal services and hence it amounts to remuneration within the * * * (statutory) definition.

'Next then we come to the query, When did the claimants earn the remuneration. While they performed the services to earn it in part by working the last scheduled work day before the holiday and the first scheduled work day after the holiday and at other times and in other ways, nevertheless by agreement they have designated that it was earned for December 25th. The parties are bound by the agreement, which is clear and unambiguous in this respect.

'In this court's opinion * * * this case is confined to and controlled by the contract we have before us, and it in effect says that the remuneration is for Christmas Day.'

In reaching the foregoing conclusion the circuit judge noted the following statutory provisions embodied in the unemployment compensation act, C.L.1948, § 421.1 et seq., Stat.Ann.1947 Cum.Supp. § 17.501 et seq.: 'Sec. 27. (c-1) * * * each eligible individual ² shall be paid his full weekly benefit rate with respect to the week in which he has earned no remuneration or remuneration equal to less than 1/2 his primary weekly benefit rate, or shall be paid 1/2 his full weekly benefit rate with respect to the week in which he has earned remuneration equal to at least 1/2 but less than his primary weekly benefit rate.' C.L.1948, § 421.27, Stat.Ann.1947 Cum.Supp. § 17.529.

'Sec. 48a. * * * an individual shall be deemed 'unemployed' with respect to any week during which he performs no services and with respect to which no remuneration is payable to him, or with respect to any week of less than full-time work if the remuneration payable to him is less than his primary weekly benefit rate * * *.' C.L.1948, § 421.48a, Stat.Ann.1947 Cum.Supp. § 17.552(1).

'Sec. 44. 'Remuneration' means all compensation paid for personal services, including commissions and bonuses and the cash value of all compensation payable in any medium other than cash * * *.' C.L.1948, § 421.44, Stat.Ann.1947 Cum.Supp. § 17.548.

As was held by the circuit judge, the agreement of May, 1948, is a factor which must be considered in reaching decision in the instant case. In part and insofar as is pertinent to decision herein this agreement between the corporation and certain of its employees, including claimants herein, acting through their bargaining agent, UAW-CIO, under the heading 'Holiday Pay' provides (emphasis supplied):

'Hereafter, hourly rated employes shall be paid for * * * Christmas Day holidays (and certain other holidays) providing they meet all of the following eligibility rules, unless otherwise provided herein (which eligibility as before noted is admitted as to these claimants). * * *

'Employes with the necessary seniority who have been laid off in a reduction of force, or who have gone on sick leave during the work week prior to or during the week in which the holiday falls shall receive pay for such holiday. * * *

'Employes eligible under these provisions shall receive eight hours' pay at their regular straight time hourly rate (subject to certain exceptions and provisions not here material). * * *

'Employes whose work is in necessary continuous seven-day operations as covered by Paragraph (87) of the National Agreement shall receive holiday pay in the event the holiday falls on one of their regularly scheduled days off, and they meet the other eligibility requirements of this procedure for paid holiday time * * *.

'In applying this procedure, when any of the above-enumerated holidays fall on Sunday and the day following is observed as the holiday by the State or Federal Government, it shall be paid as such holiday.'

Decision herein will turn upon whether the 'holiday pay' provided for in the May, 1948, agreement and received by claimants, constitutes 'remuneration' earned for services with respect to the week ending December 25, 1948. The claimant-employees' contention is that notwithstanding they received 'holiday pay' for Christmas day, 1948, none-the-less during that week they (excepting the 77 who had one day's employment) earned no compensation for personal services; and that under section 27 (c-1) of the statute above quoted each of these claimants is entitled to be paid 'his full weekly benefit rate' for the week ending December 25, 1948. In making this contention appellant and claimants take the position that the pay received by the claimants for the 1948 Christmas day was not earned 'remuneration' or wages which accrued to the claimants during the particular week in question, and that such pay should be excluded in determining unemployment benetfits due the respective claimants. If, as appellant and defendant-claimants contend, 'holiday pay' received by the claimants was not 'remuneration' earned with respect to the week in question, the 77 employees who worked one days are entitled to 1/2 the full weekly benefit rate in determining their right to unemployment compensation, and the 240 claimants are entitled to the full weekly benefit rate. But on the contrary, if such 'holiday pay' was 'remuneration' for services of claimants with respect to said week, the 240 defendant-claimants, under section 27 (c-1) above quoted, are entitled to only 1/2 of the 'full weekly benefit rate' provided in the unemployment compensation act; and the other 77 claimants who worked one day during said week and received pay therefor and also the 'holiday pay' would not, under the cited section, be qualified to receive any unemployment compensation.

We are in accord with the holding of the circuit judge to the effect that 'holiday pay' received by claimants under their contract pertaining to their employment must be held to be 'remuneration' (part of their earnings or wages) for services rendered the employer; and that such 'remuneration' was with respect to the employment of claimants during the week ending December 25, 1948.

Payment of the holiday money received by the employees under their contract is provided for under the heading 'Holiday Pay,' and uniformly designated in the agreement as 'pay.' Pay for what? Obviously as an 'emolument' or compensation for the duties and relation the employees assumed incident to their employment. Under the circumstances of the instant case, the employees are not only required to perform actual personal services on regular work days, but they must hold themselves in readiness to report for work not only...