Johnson v. Wilson & Co.

• Decision Date: 18 October 1963
• Docket Number: 38787,Nos. 38786,s. 38786
• Citation: 124 N.W.2d 496,266 Minn. 500
• Court: Minnesota Supreme Court
• Parties: Stanley R. JOHNSON et al., Claimants, Relators-Respondents, v. WILSON & CO., aka Wilson & Co., Inc., Respondent-Relators, Frank T. Starkey, Commissioner, Minnesota Department of Employment Security, Respondent.

Page 496

124 N.W.2d 496

266 Minn. 500

Stanley R. JOHNSON et al., Claimants, Relators-Respondents, v. WILSON & CO., aka Wilson & Co., Inc., Respondent-Relators,

Frank T. Starkey, Commissioner, Minnesota Department of

Employment Security, Respondent.

Nos. 38786, 38787.

Supreme Court of Minnesota.

Oct. 18, 1963.

Syllabus by the Court

1. Upon appeal from a determination of the commissioner of the Department of Employment Security the scope of review is limited to a consideration of whether the department kept within its jurisdiction; whether it proceeded on an erroneous theory of law; whether its action was so arbitrary and unreasonable as to represent its will and not its judgment; or whether the decision of the department is without evidence to support it.

2. The evidence disclosed by the record supports a finding that the employee status of persons claiming unemployment compensation was not terminated prior to the settlement of a strike or labor dispute on account of which the employees left their employment in the first instance.

3. Where the parties to a strike or labor dispute conclude a settlement of the controversy agreeing to accept the decision of arbitrators as to employment priority between the strikers and 'new hires,' the strike or labor dispute has terminated within the meaning of the disqualifying provisions of Minn.St. 268.09, subd. 1(6).

4. Unemployment is not made voluntary by agreement to arbitrate job priority as between strikers and 'new hires.'

Hall, Smith, Hedlund, Juster, Forsberg & Merlin, Minneapolis, for relators-respondents.

Meighen, Sturtz, Peterson & Butler, Albert Lea, M. Lee Bishop, Chicago, Ill., for relator. Walter F. Mondale, Atty. Gen., Joseph A. Coduti, Asst. Atty. Gen., St. Paul, for respondent.

SHERAN, Justice.

Certiorari to review a decision of the Department of Employment Security awarding and denying unemployment compensation benefits. This review involves all but 2 of 562 claims for benefits on account of unemployment arising initially out of a strike or labor dispute at the Albert Lea plant of employer-relator, Wilson & Company, Inc., hereinafter referred to as employer.

Employer is a corporation with its main offices in Chicago, Illinois. It operates meat packing plants at Albert Lea, Minnesota, and elsewhere. At Albert Lea it employs approximately 1,050 production and maintenance employees represented by the United Packinghouse Workers of America, AFL-CIO, Local No. 6, commonly referred to as Local 6, UPWA, hereinafter called the union. The employer and the union had a collective bargaining contract, which was terminated by notice from the union to the employer on September 19, 1959. Negotiations for a new contract had been carried on from July 1959 until the latter part of October 1959. On October 29, a labor dispute developed at the Albert Lea plant of the employer. ¹ An official strike was declared by the union on November 3. At different times thereafter all of the claimants involved herein filed claims for unemployment benefits. It was initially determined that these claimants were disqualified from receiving benefits on the theory that unemployment was caused by a strike or labor dispute. ² On February 26, 1960, a claims deputy of the Department of Employment Security ruled that the labor dispute ended at the plant of the employer on February 19, 1960, and that the claimants were no longer disqualified under Minn.St. 268.09. After de novo proceedings before an appeal tribunal these determinations were affirmed.

The appeal tribunal made the following findings of fact:

'On November 4, 1959, the company commenced a program of inducing the employees on strike to return to work. On that date it issued news releases for publication in newspapers and broadcasts by radio, which releases were published in all local newspapers and broadcast by radio in Albert Lea and the vicinity, urging employees on strike to return to work and announcing that employees who returned to work would not be required to sign assurance statements. * * * On November 8, 1959, the company put into effect a personal contact program at all of its plants, including the one at Albert Lea, pursuant to which management and office employees contacted employees on strike in person and by telephone, urging them to return to work. On October 30, November 25 and December 5, 1959, and on several occasions thereafter up to the time of termination of the strike, the office of the vice president of the company prepared and mailed letters to all production and maintenance workers on strike, urging them to return to work. These letters were sent out over the signature of the vice president. This entire program of inducing the striking employees to return to work continued throughout November and December, 1959. * * * During the entire period of the strike, the striking employees' names were carried on the company's payrolls as being on strike. At no time during the period of the strike were striking employees foreclosed from returning to work.

'On or about November 30, 1959, the company commenced hiring new employees in order to operate the plant so as to retain its customers.

'A series of negotiation meetings called by the U.S. Conciliation Service were held on December 17, 18, 19 and 21, 1959. However, no agreement was reached and on December 21, 1959, the meeting was adjourned for an indefinite period.

'The next series of negotiation meetings called by the U.S. Conciliation Service were held on January 11, 12, 13, 14 and 15, 1960. No agreement was reached.

'By February 16, 1960, the company had in its employ about 900 new and 25 old production workers.

'On or about February 12, 1960, the company representatives and the union representatives agreed to submit certain disputed matters to a three-member Arbitration Board for determination, which consisted of reinstatement of employees who were on strike, employees who had been suspended or discharged during the period of the strike and the order in which such employees should be recalled to work in the event agreement as to the contents of a new labor contract was reached.

'On February 16, 1960, a new collective bargaining agreement was entered into by representatives of the company and representatives of the United Packinghouse Workers of America, AFL--CIO, subject to ratification of the said union membership. On February 19, 1960, the membership of United Packinghouse Workers of America, AFL--CIO, ratified the said collective bargaining agreement and it became effective immediately. * * * Although this agreement is labeled Interim Agreement, there had been no changes or amendments made to said contract at the time of hearing herein and both the company and the union have been operating under said contract since February 19, 1960. Attached to said agreement and made a part thereof, are three supplemental agreements which were entered into on February 16, 1960, and ratified on February 19, 1960, designated as Agreement A, Arbitration Agreement B, Addendum and an agreement relating to coverage of employees for Diagnostic Insurance. Agreement A provides among other things as follows:

"As part of the settlement of the strike, the parties agree as follows:

"2. Individuals who have been notified by the company of discharge or other disciplinary action by reason of misconduct * * * shall have the right to present their cases in arbitration * * *. The reinstatement rights of all other employees shall be governed by paragraph 7 below.

"4. The union will announce by release to the press, by letter to its local unions and by letters to the AFL--CIO and to International and National unions affiliated with AFL--CIO That the strike has been settled and that this union is no longer requesting the public to refrain from buying Wilson & Co. products. * * *

"7. Commencing February 23, 1960, all striking employees shall be returned to work in accordance with the seniority and recall provisions of the Interim Agreement executed simultaneously herewith, to the extent that jobs are available, with all their previous rights of seniority and continuous service except that the rights of employees accused of having engaged in unlawful or unprotected activities after November 3, 1959, and the rights of employees for whom jobs do not become available within two full calendar weeks after February 22, 1960, shall be determined in accordance with the arbitration agreement executed simultaneously herewith.'

'The labor dispute and strike terminated on February 19, 1960, and on Monday, February 23, 1960, the company commenced recalling the employees who had been on strike back to work, and by March 14, 1960, 950 of said employees had been recalled, processed and returned to work. Thereafter, additional eligible striking employees were recalled and returned to work as soon as it was feasible to do so. All recalls of employees to return to work were made in accordance to seniority. After several meetings, the Arbitration Board ordered reinstatement of all but six of the striking production workers who had been charged with the commission of unlawful or unprotected activities during the period of the strike.'

The tribunal could also have found that the employer on November 25, 1959, in a letter addressed to 'All Production and Maintenance Employes,' advised them that 'unless you return to work by Monday, November 30, you run the risk of being replaced'; that in a letter dater December 5, 1959, the striking employees were advised that '(m)any of the strikers have now been replaced by new employes' and warned 'that each day that you fail to return to work increases the chances that a new employe will have replaced you.' By press releases, announcements, and other letters, the employer admonished that the striking employees would be replaced. On December 9, 1959, in one such news release, it stated:

'In order to avoid any misunderstanding as to the company position as a...