Huey v. Texas Employment Commission

• Decision Date: 04 December 1959
• Docket Number: No. 15658,15658
• Citation: 332 S.W.2d 366
• Parties: Clara HUEY et al., Appellants, v. TEXAS EMPLOYMENT COMMISSION et al., Appellees.
• Court: Texas Court of Appeals

Page 366

332 S.W.2d 366

Clara HUEY et al., Appellants, v. TEXAS EMPLOYMENT COMMISSION et al., Appellees.

No. 15658.

Court of Civil Appeals of Texas, Dallas.

Dec. 4, 1959.

Rehearing Denied Feb. 19, 1960.

Mullinax, Wells & Morris, Charles J. Morris and Albert Levy, Dallas, for appellants.

Will Wilson, Atty. Gen., and C. K. Richards, Asst. Atty. Gen., for appellees.

DIXON, Chief Justice.

Appellant Clara Huey and twenty-six others, employees of appellee Nardis Sportswear, brought suit pursuant to Art. 5221b, Secs. 4(h) and (i) Vernon's Ann.Civ.St. for review of a decision of appellee Texas Employment Commission denying appellants' claims for unemployment compensation. This is an appeal from a judgment of a District Court upholding the decision of Texas Employment Commission.

During the period May 21, 1956 through June 4, 1956 Nardis Sportswear shut down a substantial portion of its operations. Employees who had earned a two weeks' paid vacation in accordance with the terms of a collective bargaining contract, also employees who had earned a one week's paid vacation, were told to take their vacations during the shutdown period. Some of the employees in a few departments who had not earned any paid vacation were furnished work during the shutdown. Other employees, including these appellants, who had not worked long enough to be entitled to paid vacations were laid off during the shutdown. They applied for unemployment compensation for the period of time they were laid off without vacation pay during the shutdown. Their claims were denied.

Texas Employment Commission and the trial court held that appellants, under the terms of the collective bargaining contract negotiated through a labor union acting as their representative, had agreed to a vacation shutdown, consequently they had left their work voluntarily without good cause connected with their work, and were therefore disqualified for benefits under Art. 5221b-3(a) V.A.C.S.

Facts.

The facts are undisputed, having been agreed to by the parties and set out at length in a written stipulation. We shall hereinafter quote from or state the substance of the more important parts of the stipulations.

Since 1941 International Ladies Garment Workers Union has been the collective bargaining agent for all of Nardis Sportswear employees. During the intervening period of time the Union and Nardis have been parties to collective bargaining contracts relating to the wages and working conditions of all said employees.

On or about March 14, 1955, Nardis and the Union entered into a revised collective bargaining contract which sets up a vacation plan as follows:

'A. The object of establishing the Vacation Plan hereinafter set forth is to provide the workers with diversion and rest from steady continuity of work and to contribute to their health and welfare.

'B. It is the desire and intention of the parties that eligible employees receive and enjoy annually the benefits of paid vacations. Employees are therefore expected not to accept other employment during such vacation periods, otherwise the actual purpose of this vacation plan will be defeated. Acceptance by an employee of work elsewhere during a vacation shall terminate his or her employment status with the Employer at the discretion of the Employer.

'C. The Employer agrees to grant one (1) week's annual vacation with pay, * * * to all workers who as of May 1st, of any calendar year during which this agreement is in effect have at least one (1) year's service with the Employer immediately prior to such date; and, two (2) weeks' vacation with pay * * * to all workers who as of the same date have at least five (5) years' service with the Employer.

'D. The vacation period shall be determined by the Employer at times between May 1st and June 30th of each year.'

The production facilities of Nardis, though carried on in one building, are divided into two factories. The employees in the third floor factory, numbering approximately one hundred twenty (120), work largely on dresses and suits. The employees in the second floor factory, numbering approximately one hundred forty (140), work largely on skirts and blouses. Of the employees on the first floor approximately fifty (50) are engaged in finishing and pressing garments produced on the second and third floor factories; approximately fifteen (15) work as cutters, approximately sixteen (16) work in the belt department, and approximately fifteen (15) in the bundling department.

Since 1946 it has been the practice for Nardis to shut down substantial parts of its operations between seasons; that is, when there are no more orders to fill for summer garments the shutdown occurs. When operations resume they are on new production devoted to the manufacture of fall garments. The time for this shutdown varies. It has been as early as April and as late as June. It has usually been in May.

In 1956 approximately two weeks before the vacations were taken, Nardis notified the employees that the factories would be closed from May 21, 1956, through June 4, 1956.

During the period above named Nardis substantially ceased all production operations on its second floor factory. During the same period operations were substantially reduced in its third floor factory. Employees working in the third floor factory who were not entitled to paid vacations under the contract were generally given work during this period of time. But in the second floor factory no work was available and with a few exceptions none of the second floor employees worked during the vacation period.

Most of the first floor employees continued to work during the period May 21, 1956, through June 4, 1956, for the reason that their operations were finishing operations and work was available for them. Thereafter the first floor employees who were entitled to paid vacations under the contract received a vacation on a staggered basis with various employees taking their vacations at different periods of time. Such vacations were taken to coincide with the employer's production schedule so that nonvacationing employees would be available to perform the necessary finishing work as the garments came down from the second and third floors for completion.

We quote again from the stipulation:

'15.'

'It has traditionally been the practice of Nardis to employ its employees when work, i. e., orders for finished merchandise, is available. At such times as when work has been short or unavailable it has been necessary to lay off its employees. None of the employees are guaranteed any set number of hours per week or any set amount of work or hours during the years, and some times the factory has been shut down for lack of work when such shutdowns have not coincided with the period when vacations were taken.

'16.

'Throughout the years that vacations have been given the union has never agreed that the vacations should be by plant shutdown. The decisions substantially to shut down the factory during the time when vacations are given has always been the employer's decision in accordance with the terms of the contract.

'17.

Although the union at all times material hereto was the collective bargaining representative for all of the production employees, some of the employees were not members of the union, including some of the employees who received no vacation pay because of insufficient seniority and those who received one week's vacation pay only because of insufficient seniority. It is agreed, however, that most of the employees were members of the union.

'18.

'At no time did any of the plaintiffs request or authorize the union to agree that they or any of them or any employee similarly situated was to receive a vacation without pay whether for a period of one week, two weeks or any other period of time, and the union did not at any time request or agree with Nardis that any such employees was to be given unpaid vacations for any period of time, except to the extent, if any, that they were bound by the contract between the union and the employer of which all employees had notice.

'19.

'Neither management nor the union objected to employees who received no vacation pay from seeking and obtaining other employment during the shutdown when other employees were on vacation and receiving vacation pay, or employees who received only one week's vacation from seeking and obtaining other employment for the remaining time they were out of work during the aforesaid period when the plant operations were shut down or curtailed.'

Each of appellants during the times material to this controversy was able to work and was available for work either at Nardis or elsewhere.

Opinion.

Since the facts are undisputed we are faced only with a question of law. Appellants have briefed four points on appeal, but we believe that all their points may be encompassed in this one question:

When a plant shutdown occurs under the circumstances shown in this case, and employees eligible for paid vacations under the terms of a collective bargaining contract are required to take their vacations during the period of the shutdown, is it error to hold that union employees who are laid off during the shutdown but are not eligible for paid vacations are disqualified under Art. 5221b-3(a) V.A.C.S. from receiving unemployment benefits during the shutdown because, under the terms of the collective bargaining contract, they may be said to have agreed to a vacation shutdown, so must be held to have left their last work voluntarily without good cause connected with their work?

So far as we know the question is a matter of first impression before the courts of Texas.

The question has been passed on in other States with varying results and conflicts. See Annotations in 30 A.L.R.2d 366, and Supplemental Annotations.

Among the cases from other jurisdictions cited by appellants in support of their contentions that they are entitled to unemployment compensation are these: ...