Inter-Island Resorts, Limited v. Akahane

• Citation: 377 P.2d 715,46 Haw. 140
• Decision Date: 27 November 1962
• Docket Number: INTER-ISLAND,No. 4148,4148
• Parties: RESORTS, LTD. v. Elizabeth K. AKAHANE et al.
• Court: Hawaii Supreme Court

Page 715

377 P.2d 715

46 Haw. 140

INTER-ISLAND RESORTS, LTD. v. Elizabeth K. AKAHANE et al.

No. 4148.

Supreme Court of Hawai'i.

Nov. 27, 1962.

Syllabus by the Court

1. The term 'labor dispute,' as used in the Hawaii Employment Security Law, embraces the concept of a dispute over employee representation by a union resulting in an organizational strike.

2. The phrase 'stoppage of work,' as used in the Hawaii Employment Security Law (R.L.H.1945, § 4231(d)), means a substantial curtailment of the business activities at the employer's establishment rather than unemployment on the part of the striking employee.

3. The phrase 'availability for work,' as used in the Hawaii Employment Security Law (R.L.H.1945, § 4230(c)), means a willingness and readiness on the part of a claimant for unemployment compensation benefits to accept suitable work which he does not have good cause to refuse. As long as the activities of an unemployed claimant in picketing do not substantially affect his willingness and readiness to accept suitable work, he must be deemed to have met the availability requirement of the statute.

4. An individual whose unemployment is due to a stoppage of work which exists because of a labor dispute cannot be said to have 'left his work voluntarily' within the meaning of the voluntary separation provision of the Hawaii Employment Security Law (R.L.H.1945, § 4231(a)).

5. Under the Hawaii Employment Security Law (R.L.H.1945, § 4231(c)) the 'labor dispute' disqualification provision and 'the refusal to accept suitable work' provision are mutually exclusive. Where claimants are unemployed because of a labor dispute, and the employment relationship remains unsevered by any intervening cause, the existence of a 'stoppage of work' perforce excludes the application of the 'refusal to accept suitable work' disqualification. On the other hand, if, after the strike commences, the employment relation is terminated, either by the claimant's action of quitting or the employer's action of discharge, then the proviso that no work shall be deemed suitable 'if the position offered is vacant due directly to a strike, lockout, or other labor dispute' prohibits the denial of benefits for refusal to accept the work he quit or from which he was discharged.

Carlsmith, Carlsmith, Wichman & Case, Hilo, H. William Burgess, Honolulu, for appellant.

Toshimi Sodetani, Deputy Atty. Gen., Honolulu (W. R. Watkins, Jr., Deputy Atty. Gen., Honolulu, on the briefs), for appellees.

Before TSUKIYAMA, C. J., CASSIDY and WIRTZ, JJ., Circuit Judge FAIRBANKS, in place of LEWIS, J., disqualified, and Circuit Judge HEWITT, in place of MIZUHA, J., disqualified.

WIRTZ, Justice.

This is an appeal from the judgment of the Circuit Court of the Third Circuit, entered on July 22, 1959, reversing and setting aside the decision of the Referee for unemployment compensation appeals. The case involves claims for unemployment benefits under the Hawaii Employment Security Law, filed on February 6, 1953 (effective as of February 1, 1953), by thirty-two employees of Inter-Island Resorts, Ltd.

The facts were agreed upon and submitted to the circuit court under the pretrial order. Briefly, the claimants were employed at the Kona Inn, located in Kailua, Kona, Hawaii, until they were called out on strike ¹ on New Year's Eve, December 31, 1952, by the Hotel and Restaurant Employees and Bartender's Union, Local 5, A.F.L.

During the first two days of the strike the employer operated with the help of supervisors and hotel guests. Service was curtailed but not to the extent of requiring the closing down of the hotel operations. During the first week of the strike the employer hired replacements and by the end of the week operations and service were substantially back to normal. With the commencement of the strike a picket line was established at the Kona Inn and was continued at least through the month of March 1953.

On February 10, 1953, at a meeting held between the employer and the union, the union was informed that eleven positions were still vacant and were available to the claimants. The positions so offered to the claimants by the employer were not accepted.

The Commission of Labor and Industrial Relations of the Territory of Hawaii, through its administrator, made the original determination on May 8, 1953, which allowed the claims and charged the amounts of the benefits against the employer's reserve account. The employer appealed from this determination and the appeal was heard by a referee for the Bureau of Employment Security who affirmed the determination by his decision of July 21, 1953 and further decision of October 6, 1953. The employer then filed with the circuit judge at chambers, circuit court of the third circuit, a petition for judicial review of the referee's decision. The commission was joined as a party respondent in the petition as provided by statute.

In the pre-trial order the circuit judge set forth the following issues of law as those to be determined:

'1. Were Claimants eligible for unemployment compensation under Section

4230(c), Revised Laws of Hawaii 1945?

'2. Were Claimants disqualified for unemployment compensation under Section 4231(a), Revised Laws of Hawaii 1945?

'3. Were Claimants disqualified for unemployment compensation under Section 4231(c), Revised Laws of hawaii 1945?

'4. Were Claimants disqualified for unemployment compensation under Section 4231(d), Revised Laws of Hawaii 1945?

'5. Should the benefits paid to Claimants be charged to the account of the Employer under Section 4250(b), Revised Laws of Hawaii 1945, as amended, and under the general intent and purpose of the Hawaii Employment Security Law?'

The circuit judge ruled against the employer on the first three issues and for the employer on the fourth issue. He did not rule on the fifth issue, presumably because that issue became moot in view of his ruling on the fourth issue. He filed a written decision in which he set forth his reasoning for these rulings and thereupon entered the judgment from which both the commission and the employer appealed.

Upon the docketing of the appeals, the commission filed its opening brief, but the employer failed to do so. However, in its answering brief, in addition to answering the commission's arguments set forth in the opening brief, the employer stated four other questions which corresponded to the first three and the fifth issues set forth in the pre-trial order. Presumably, the employer intended its answering brief to serve a dual purpose, that is, as its opening brief on its appeal and as its answering brief on the commission's appeal.

The commission filed a motion to strike portions of the answering brief dealing with the four additional questions stated by the employer and to dismiss the employer's appeal. In Inter-Island Resorts, Ltd. v. Akahane, 44 Haw. 93, 352 P.2d 856, the motion to strike was denied, although the fifth question raised in the employer's answering brief was held to be premature and not before this court under this appeal. At the same time the employer's appeal was dismissed.

The appeal before us then is that of the commission and specifies as error that:

'1. The Circuit Court erred in concluding that '* * * the disqualification in subsection (d) (of Section 4231) is plain and that it applies when, because of a labor dispute at the premises of the employer, the employee of that employer does not work at his job, that he is disqualified from receipt of unemployment benefits.'

'2. The Circuit Court erred in its conclusion that the Claimants are disqualified for unemployment compensation under Section 4231(d), Revised Laws of Hawaii 1945.'

The additional questions raised in the answering brief, other than the fifth relating to the charging of the employer's account for benefits allowed, are likewise to be considered under the appeal as they were ruled on by the circuit judge and his rulings thereon were in support of the judgment entered.

Preliminarily, (although there didn't seem to be complete agreement on the part of the employer at the time of argument) it should be noted that it appears to be conceded that the unemployment in this case arose out of a 'labor dispute.' ² There was agreement that the cause of the unemployment of the claimants was the dispute over employer representation by the union which led to the organizational strike. Any disagreement there might be centers on the question of whether or not such dispute constituted a 'labor dispute' as that term is used in the Hawaii Employment Security Law.

The term 'labor dispute' is nowhere defined in the Hawaii Employment Security Law. Most unemployment compensation acts of other jurisdictions likewise fail to define this term. For the most part courts, in unemployment compensation cases, have resorted to the definition given in the National Labor Relations Act and the NorrisLa Guardia Act. ³ Miners in General Group v. Hix, 123 W.Va. 637, 17 S.E.2d 810; Dallas Fuel Co. v. Horne, 230 Iowa 1148, 300 N.W. 303. In fact some courts have gone so far as to hold the federal statutory definitions binding. Barnes v. Hall, 285 Ky. 160, 146 S.W.2d 929; Sandoval v. Industrial Comm., 110 Colo. 108, 130 P.2d 930.

The definition contained in the National Labor Relations Act has been substantially incorporated in Chapter 92, Revised Laws of Hawaii 1955, dealing with Labor Disputes, Stevedoring Industry. ⁴ With this legislative expression of approval in mind, we have no hesitation in accepting this definition of 'labor dispute' as governing the situation before us which embraces the concept of a dispute over employee representation by a union resulting in an organizational strike. Cf., Nobes v. Michigan Unemployment Comp. Comm., 313 Mich. 472, 21 N.W.2d 820; Gerber v. Board of Review, 36 N.J.Super. 322, 115 A.2d 575; Rainfair, Inc. v. Cobb, 229 Ark. 37, 312 S.W.2d 906.

The commission contends that the phrase 'stoppage of work' as used...