George A. Hormel and Co. v. Hair, 87-793

• Decision Date: 22 July 1988
• Docket Number: No. 87-793,87-793
• Citation: 426 N.W.2d 281,229 Neb. 284
• Parties: , 115 Lab.Cas. P 56,226 GEORGE A. HORMEL AND COMPANY, Appellant, v. Randall D. HAIR et al., Appellees.
• Court: Nebraska Supreme Court

Page 281

426 N.W.2d 281

229 Neb. 284, 115 Lab.Cas. P 56,226

GEORGE A. HORMEL AND COMPANY, Appellant, v. Randall D. HAIR et al., Appellees.

No. 87-793.

Supreme Court of Nebraska.

July 22, 1988.

Syllabus by the Court

1. Employment Security: Labor and Labor Relations. As a general rule, a provision which disqualifies employees from receiving benefits when their unemployment is caused by a stoppage of work due to a labor dispute refers to the employer's plant operations rather than the employee's labor.

2. Employment Security: Labor and Labor Relations: Words and Phrases. A work stoppage exists when a substantial curtailment of work occurs in an employing establishment.

3. Employment Security: Labor and Labor Relations. Under the National Labor Relations Act, 29 U.S.C. §§ 151 et seq. (1982), the refusal to cross a picket line has been determined to be a protected activity.

4. Employment Security: Labor and Labor Relations. In a determination of whether or not any work is suitable for an individual, a claimant shall not be denied benefits if the position offered is vacant due directly to a labor dispute.

Kevin J. Kinney, of Krukowski & Costello, S.C., Milwaukee, Wis., Kelly S. Breen, of Laughlin, Peterson & Lang, Omaha, and James W. Cavanaugh, Austin, Minn., for appellant.

Laureen Van Norman and John F. Sheaff, Lincoln, for appellee Com'r of Labor.

BOSLAUGH, WHITE, and SHANAHAN, JJ., and GITNICK and GARDEN, District Judges.

GITNICK, District Judge.

This action involves an appeal from the judgment of the district court for Dodge County, which had affirmed the decision of the Nebraska Appeal Tribunal allowing unemployment compensation benefits to the claimants.

This appeal requires us to examine the activities of certain employees, hereinafter claimants, of George A. Hormel and Company, hereinafter Hormel, and of Hormel, which operates a meatpacking plant in Fremont, Nebraska, to determine if the activities of the claimants constituted a work stoppage and whether the claimants were improperly awarded benefits to which they were not entitled, pursuant to Neb.Rev.Stat. § 48-628 (Cum.Supp.1986). Neb.Rev.Stat. § 48-640 (Cum.Supp.1986) mandates that our review is de novo on the record made in the trial court of the proceedings tried before the Nebraska Appeal Tribunal of the Nebraska Department of Labor, which, therefore, requires us to retry the factual issues involved in the findings complained of and to reach independent conclusions therefrom. Norman v. Sorensen, 220 Neb. 408, 370 N.W.2d 147 (1985); School Dist. No. 21 v. Ochoa, 216 Neb. 191, 342 N.W.2d 665 (1984).

Hormel, the appellant and employer, operates meat processing plants in Fremont, Nebraska, in Austin, Minnesota, and elsewhere. The claimants are 43 employees of Hormel at the Fremont plant, and all are members of the United Food and Commercial Workers Union Local 22. Hormel's Austin, Minnesota, plant was struck by Local P-9 of the international union on August 17, 1985, which for operational purposes resulted in shutting down the Austin plant. In an effort to broaden the impact of the strike at the Austin plant, the leadership of Local P-9 sought authority from the international union to extend picket lines to other plants, including the Fremont facility, but was unable to obtain such authorization.

At about the same time as the commencement of the strike at the Austin plant, a local organization was formed in Fremont, which was designated as the "United Support Group," with an announced purpose of supporting the efforts of Local P-9 in its bargaining efforts with Hormel, and which included members of Local 22 of the Fremont plant. Local 22 did not strike the Fremont plant, but approximately 80 of its members out of a work force of 860 employees failed to report for work on January 27, 1986. Local 22 did increase its dues structure because of the strike activities at other plant locations, and the revenues were distributed to the membership of the striking local unions. Also, at least one of its members did participate in an informational picket line at the Fremont plant established by Local P-9 of the Austin plant. It is unclear from the evidence whether any other members of Local 22 were actually manning the picket line at the Fremont plant, but the evidence does show the line was primarily manned by spouses of members of Local 22 and by other members of the United Support Group.

On January 27, 1986, Hormel was unable to operate the ham, skin, and fat line division of its Fremont operations due to the failure of a number of its employees to report for work, but all other operations of the plant did continue. Hormel commenced hiring replacement workers and was operational in all departments the next day. On January 29, 1986, all employees honoring the picket line gave formal notice to Hormel that they were honoring a legally established picket line and that they had not resigned their respective positions. Hormel thereafter notified all employees honoring the picket line that they were being permanently replaced by new personnel.

In order to enlist the aid of the Nebraska Job Service in obtaining replacement employees, on February 13, 1986, Hormel and the leadership of Local 22 sent a joint letter to the office of the division of employment of the Nebraska Department of Labor, in which they jointly stated that there was no work stoppage at the Fremont plant.

The picket line established by Local P-9 remained at the Fremont plant until June 4, 1986, and all of the claimants refused to cross the picket line to return to other jobs. On June 4, 1986, all claimants who had not otherwise terminated their employment relationship with Hormel made an offer to return to work, and Hormel placed them on its preferential recall list.

All of the 43 claimants involved in this case filed claims for unemployment compensation benefits, and the Nebraska Department of Labor undertook an investigation to determine the propriety of the claims. At a conference with the claims deputy, Hormel's Fremont plant personnel manager advised that the picket line activity resulted in a 4.9-percent loss of production and a 2.9-percent loss of hours; that the Fremont plant sustained a reduction in production, but "not ... anywheres (sic) near 25 percent," because it had to reassign certain of the workers it had and had to hire untrained replacement personnel; and that there was a reduction in the number of the work force of from 9.4 percent on January 27, 1986, to a reduction of approximately 2 percent by the end of the first week.

The Department of Labor determined there was no work stoppage due to a labor dispute at the Fremont plant and allowed benefits without any disqualification period, which determination was affirmed by the Nebraska Appeal Tribunal and, on appeal, by the district court for Dodge County. This appeal followed.

Hormel assigns as error the determination there was no work stoppage, as defined in § 48-628(d), as it contends the preponderance of the evidence demonstrated that the claimants' unemployment arose out of a labor dispute at the Hormel plant; that the claimants left their employment without good cause as defined in § 48-628(a); and that the claimants failed, without good cause, to accept its offer of suitable work within the meaning of § 48-628(c).

Section 48-628(d) provides a two-part test for disqualification of a claimant's right to receive unemployment benefits, as it requires that the Commissioner of Labor must find (1) that the unemployment of the claimant is due to a work stoppage and (2) that the work stoppage results from a labor dispute.

There is no question but that a labor dispute existed when the claimants honored the picket line established by the Local P-9 membership at the Fremont plant and absented themselves from their employment. Hormel asserts that because a labor dispute existed and the claimants participated therein, and because the claimants financed the labor dispute which caused the work stoppage, the claimants should be automatically disqualified from receiving unemployment benefits.

Hormel supports its position by citing the case of Baker v. General Motors Corp., 478 U.S. 621, 106 S.Ct. 3129, 92 L.Ed.2d 504 (1986). However, that case is premised on a Michigan statute which specifically disqualifies claimants where " 'the individual's total or partial unemployment is due to a labor dispute in active progress ...'," 106 S.Ct. at 3131 n. 1, and this is substantially different from the Nebraska Employment Security Law, Neb.Rev.Stat. §§ 48-601 et seq. (Reissue 1984 & Cum.Supp.1986), which provides for a disqualification when the claimant's unemployment is caused by a work stoppage resulting from the labor dispute. "As a general rule ... [a] provision which disqualifies employees from receiving benefits when their unemployment is caused by a stoppage of work due to a labor dispute refers to the employer's plant operations, rather than the employee's labor." 81 C.J.S. Social Security § 244 at 490 (1977). Therefore, the issue for determination is whether a work stoppage existed within the meaning...