Marathon Elec. Mfg. Corp. v. Industrial Commission

• Decision Date: 05 April 1955
• Citation: 69 N.W.2d 573,269 Wis. 394
• Parties: MARATHON ELECTRIC MFG. CORP., Appellant, v. INDUSTRIAL COMMISSION and Leslie E. Dickinson, Respondents. MARATHON ELECTRIC MFG. CORP., Appellant, v. INDUSTRIAL COMMISSION and Barbara Jones, Respondents.
• Court: Wisconsin Supreme Court

Page 573

69 N.W.2d 573

269 Wis. 394

MARATHON ELECTRIC MFG. CORP., Appellant, v. INDUSTRIAL COMMISSION and Leslie E. Dickinson, Respondents.

MARATHON ELECTRIC MFG. CORP., Appellant, v. INDUSTRIAL COMMISSION and Barbara Jones, Respondents.

Supreme Court of Wisconsin.

April 5, 1955.

Rehearing Denied June 1, 1955.

See 70 N.W.2d 576.

Lines, Spooner & Quarles, Milwaukee, John G. Kamps & Laurence E. Gooding, Jr., Milwaukee, of counsel, for appellant.

Arnold J. Spencer, Austin T. Thorson, Madison, for respondent Industrial Comm.

CURRIE, Justice.

It is stated in the briefs that the appeal in these two cases and that of the four companion cases of Streeter v. Industrial Comm., Wis., 69 N.W.2d 583, are test cases which will govern the rights of many other former employees of the employer who have claims pending for unemployment compensation benefits.

On this appeal the following issues are presented:

(1) Is the Commission's finding of fact, that employees Jones and Dickinson were discharged by the employer in February, 1952, supported by the evidence?

(2) Have these two employees' rights to unemployment compensation benefits been suspended for the period covered in the employees' applications because of the provisions of section 108.04(10), Stats., relating to labor disputes?

(3) Did the refusal of these two employees to apply to the employer for work as requested in the employer's letter of March 5, 1952, bar them from benefits under the provisions of either section 108.04(1)(a) or 108.04(8)(a), Stats.?

In considering the first of these three questions we find that section 108.09(7) of the Wisconsin Unemployment Compensation Act, ch. 108, makes the provisions of ch. 102 (the Wisconsin Workmen's Compensation Act) with respect to judicial review applicable to court review of decisions of the Commission under ch. 108. Therefore, the findings of fact of the Commission in the instant appeal are conclusive on this court if there is any credible evidence which, if unexplained, would support such findings. Hills Dry Goods Co. v. Industrial Comm., 1935, 217 Wis. 76, 85, 258 N.W. 336; Motor Transport Co. v. Public Service Comm., 1953, 263 Wis. 31, 46, 56 N.W.2d 548.

The finding of fact of the Commission covering the question of whether there had been a discharge is as follows:

'The letters dated February 29, 1952 that were sent to the employe and the other factory workers informed them that they were discharged. This discharge terminated the employer-employe relationship * * *'

The material portion of the identical letters mailed to the employees Jones and Dickinson on February 29, 1952, by the employer, read as follows:

'Since the action taken by the Union and its members Thursday afternoon was the second such violation resulting from irresponsible leadership, the Company has no alternative but to consider that all participants have forfeited any rights as employees and are accordingly being removed from the company's payroll. This means that all employee benefits such as group insurance, vacation plans, holiday pay plans, etc., are being eliminated immediately.'

It is contended by the employer that these letters only purported to discharge participants in the unauthorized walkout of February 28th, and, inasmuch as neither Jones nor Dickinson were at work when the walkout occurred, they were accordingly not discharged. However, the employer's president Wall, who signed these letters and authorized sending them out, when asked whether such letter terminated the employer-employee relationship of all the employer's factory workers, answered unequivocally as follows:

'I think that the February 29 letter did.'

Not only did Wall so interpret the February 29th letters but both Jones and Dickinson testified that they also interpreted such letters as discharging them. The fact that the employer sent such letter to Jones and Dickinson is also very significant. The employer's time card records of each employee contained the information as to which employees had been at work and which had not when the walkout occurred and there, therefore, was no reason for sending the February 29th letter to employees such as Jones and Dickinson unless their discharge was intended to be accomplished thereby. The locking of the factory gates so as to bar Jones and Dickinson as well as other employees from work also bears on the interpretation to be placed on the letter. Furthermore, the ensuing letter from the employer to these two employees dated March 5, 1952, contained this sentence: 'You should know, that unfortunately, this union action forces us to consider everyone who is rehired to be a new employee'. Such a statement is certainly consistent with the hypothesis that the employer then considered that something had already occurred which had terminated the employer-employee relationship.

We are constrained to hold that there was sufficient credible evidence to support the Commission's finding as to the discharge. Section 108.04(5), Stats., bars an employee from benefits who has been discharged for misconduct, but the employer does not contend that these two employees were guilty of any act of misconduct justifying their discharge, nor would the evidence sustain such a finding.

Section 108.04(10), Stats., provides as follows:

'An employe who has left (or partially or totally lost) his employment with an employer because of a strike or other bona fide labor dispute shall not be eligible for benefits from such (or any previous) employer's account for any week in which such strike or other bona fide labor dispute is in active progress in the establishment in which he is or was employed.'

Except as to week No. 9 of 1952 (the week in which the walkout of February 28th occurred) both the appeal tribunal and the Commission found that section 108.04(10) did not bar Jones and Dickinson from benefits. However, they reached such result on different grounds as noted in the statement of facts preceding this opinion. The appeal tribunal found that these employees had not lost their employment because of a labor dispute but by reason of a discharge for alleged breach of the collective bargaining agreement. Assuming this hypothesis the statute would not apply to these two employees regardless of whether or not a labor dispute continued in progress after their discharge. On the other hand, the Commission determined that Jones and Dickinson lost their employment 'because of a labor dispute which was in active progress' and thereby were barred from benefits for week No. 9. However, by reason of its finding that the letter of February 29th terminated the employment of all of the employees with whom the employer was engaged in the labor dispute, the Commission held this terminated the dispute so that there was then no longer a labor dispute in progress which would bar these two employees from benefits as to the weeks subsequent to week No. 9.

It is our considered judgment that the conclusion reached by the appeal tribunal is more nearly correct than that of the Commission. The Commission's determination of this issue, which under the facts of this case presents a question of statutory construction, constitutes a conclusion of law and not a finding of fact, and, therefore, is not binding upon us on this appeal.

In order to better interpret the meaning of section 108.04(10), Stats., we deem it advisable to ascertain the legislative objective or policy sought to be attained by its enactment. The views of the Commission, which for many years has been administering the Wisconsin Unemployment Compensation Act, as to the legislative policy underlying this particular section is entitled to great respect. The Commission's conclusion as to this is stated in its brief as follows:

'Since the enactment of the first unemployment compensation law in 1931 the law has contained a provision suspending eligibility of workers unemployed because of a strike or a bona fide labor dispute. The labor dispute provision constitutes a 'neutrality act' which the legislature inserted into the Act. It is to be borne in mind that the unemployment compensation act was prepared by representatives of labor and management and the public. In designing this legislation, it was the fear of both employer and employe representatives that payment of unemployment compensation, unless appropriate safeguards were taken, might prove to be an instrument which might be inappropriately used, their respective interests considered, in an industrial controversy. An analysis will show the wisdom from both the standpoint of labor and of management of suspending benefit payments in any situation in which these industrial forces are engaged in a bona fide controversy. This suspension of benefits places the administrative agency in a neutral position with respect to the contending forces.

'Under the Wisconsin law, employer contributions finance the unemployment benefits paid to workers. Management, therefore, is not desirous that the funds built up by it could be used to finance a strike or other form of labor controversy directed against it. Present law takes a 'hands off' approach. It stays neutral. It does not require that the administrative agency determine the merits of the labor dispute. If there is a controversy or labor dispute, then the disputants, are ineligible for unemployment benefits during the active progress of such dispute.'

Another material factor to be considered in construing section 108.04(10) is the continuing relationship that is held to exist between an employer and its employees during a labor dispute in which a strike or lockout is in progress. A statement giving recognition to the existence of such continuing relationship, and characterizing its nature, which has received wide acceptance in subsequent decisions, is to be found in the concurring opinion of Judge Grosscup in Iron Molders' Union No. 125 of Milwaukee, Wis. v. Allis-Chalmers Co., 7 Cir., 1908, 166 F. 45, 52...