Redd v. Texas Employment Commission

• Decision Date: 31 May 1968
• Docket Number: No. 375,375
• Citation: 431 S.W.2d 16
• Parties: Stella M. REDD et vir, Appellants, v. TEXAS EMPLOYMENT COMMISSION et al., Appellees. . Corpus Christi
• Court: Texas Court of Appeals

Page 16

431 S.W.2d 16

Stella M. REDD et vir, Appellants, v. TEXAS EMPLOYMENT COMMISSION et al., Appellees.

No. 375.

Court of Civil Appeals of Texas Corpus Christi.

May 31, 1968.

Robert C. Eckhardt, Houston, Travis Peeler, Corpus Christi, for appellants.

Lewright Dyer & Redford, Walter Dunham, Jr., Corpus Christi, Steve Hollahan, Asst. Atty. Gen., Austin, Jon Dee Lawrence, Houston, for appellees.

OPINION

GREEN, Chief Justice.

The parties in this lawsuit are Stella M. Redd, a former employee of Southwestern Bell Telephone Company, who will be referred to as Claimant or Appellant, Texas Employment Commission, referred to herein as the Commission, and Southwestern Bell Telephone Company, herein styled Employer.

Claimant was originally employed by Employer in 1916, worked for a short while and left, and was thereafter re-employed on April 14, 1943. She continued to work as a telephone operator for Employer until her retirement on June 1, 1965, at the age of 65 years (her birth date was May 23, 1900) under Employer's compulsory retirement rule which had been in effect since July 1, 1930, reading as follows:

'RESOLVED: That on July 1, 1930, every officer or other employee of this Company who at that time is 65 years of age or over shall be retired from active service and thereafter every officer or other employee becoming 65 years of age shall be retired at the end of the month in which he reached such age, provided, however, that by action of this Board the operation of this resolution may be delayed from year to year with respect to any employee who is performing such services for the Company that his continuation as an active employee is deemed for the best interest of the telephone service.'

As a telephone operator Claimant had been at all times a member of the Communications Workers of America, which union was the recognized collective bargaining agent for the employees of the telephone company. Since her compulsory retirement on June 1, 1965, Claimant has received from Employer a pension based on approximately 26 years of service amounting to $74.44 per month during the remainder of her life. The pension plan provides that the annual pension allowance for each employee retired with a pension at the age of 65 years shall be 1% Of her average annual pay during the five years next preceding retirement for each year of her term of employment. The amount may be raised in the future but not reduced, in accordance with a provision in the collective bargaining agreement between the union and Employer effective at all times here pertinent reading as follows:

'During the term of this Agreement, no change may be made without the consent of the Union in the existing 'Plan for Employees' Pensions, disability Benefits and Death Benefits' which would reduce or diminish the benefits or privileges provided thereunder. Any claim that such benefits or privileges have been so diminished or reduced may be presented as a grievance and if not resolved by the parties under their grievance machinery may be submitted to arbitration pursuant to the provisions of Article V hereof; but in any such case any decision or action of the Company shall be controlling unless shown to have been discriminatory or in bad faith and only the question of bad faith or discrimination shall be subject to the grievance procedure or arbitration.'

The 'Plan for Employees' Pensions, Disability Benefits and Death Benefits' was voluntarily inaugurated by Employer and its predecessor, and is a non-contributory plan as to the employees. Appellant's last day of work was April 30, 1965. During the month of May she took her accrued vacation time. About May 22 she notified Employer that is was not her desire to retire, but she received no reply to her letter.

On June 2, 1965, Claimant filed a claim for unemployment benefits with the Commission. On June 24, 1965, her claim was denied by the Commission's representative, who found that she was Disqualified for benefits because, as he reported, 'You left your last work to retire under a company pension plan upon reaching retirement age. A separation from work under these circumstances is considered a voluntary resignation without good cause connected with the work;' and that such disqualification would continue for six weeks beginning June 2, 1965, and that there would be no charge back to the account of Employer as the result of her claim.

Appellant appealed, through the recognized procedures, to the Appeal Tribunal of the Commission, which after a hearing with evidence affirmed the initial determination of the Commission representative, adding thereto its conclusion that appellant was Ineligible to receive benefits under the law because she had failed to make an active, diligent and independent search for work and that such ineligibility would continue until such time as she presents evidence to establish her availability for work. Appellant appealed from this decision to the full Commission which, after a hearing, adopted the findings of fact and conclusions of law of the Tribunal, and affirmed its decision in all respects. Appellant requested a rehearing to submit further evidence and at such rehearing testified that she had applied for work at four establishments, seeking PBX work, sales work, or any other employment for which she might be suited, but without success. After this hearing, the Commission reaffirmed its original decision.

Appellant next timely filed her appeal of the Commission's decision to the district court. The case was tried before the court without a jury, at which trial stipulations of facts and the complete transcript of all testimony given at the various hearings were placed in evidence, and additional testimony was heard. The court in a general judgment found that the findings and decision of the Commission were supported by substantial evidence, and sustained the Commission's order. This appeal followed. Appellant's first and second points of error read as follows:

I

'There is no substantial evidence upon the record as a whole that Appellant voluntarily left her employment; but, on the contrary, the clear and convincing evidence is that she was dismissed from her employment under a Company policy which was invoked to retire her against her will.

II

'The Commission's determination, sustained by the trial court, that Appellant left her employment voluntarily without good cause connected with her work, is as a matter of law erroneous.'

To these points, appellees reply by their first counterpoint as follows:

I

'The findings and decision of the Texas Employment Commission, affirmed by the District Court, that Claimant voluntarily left her work to retire pursuant to a pension plan without good cause connected with her work, are supported by substantial evidence in the record and in accordance with the law.'

Generally speaking, all unemployment compensation laws, including the Texas Act, require that a claimant meet a two-fold test before the receipt of benefits can be effected. The claimant must be found to be Eligible. Art. 5221b--2.* This requirement will be considered later under appellant's 4th and 5th points. The next inquiry is whether the claimant is for any reason Disqualified to receive benefits, and the appropriate period of disqualification. In this connection, we quote from the applicable statute as follows:

'Art. 5221b--3. Disqualification for benefits

An individual shall be disqualified for benefits: (a) If the Commission finds that he has left his last work voluntarily without good cause connected with his work. Such disqualification shall be for not less than one (1) nor more than twenty-six (26) benefit periods following the filing of a valid claim, as determined by the Commission according to the circumstances in each case. * * *'

Sub-paragraphs (b) to (g) are not quoted, since they are not applicable to our factual situation.

It appears from all of the evidence in the record that appellant was well informed during practically the entire period of her employment after 1943 of Employer's retirement rule and of its pension plan. While the retirement rule gave Employer's board of directors the option of delaying the retirement of 'an employee who is performing such services for the Company that his continuation as an active employee is deemed for the best interest of the telephone service,' there was no evidence that appellant comes within such classification. The evidence before the Commission and the trial court clearly disclosed that appellant during her years of employment understood that she would be retired at the age of 65 years and that she would draw a pension from Employer under the latter's pension plan. The evidence shows without dispute that she was ready, willing and able to continue in her employment had the company permitted her to do so.

The question of law presented by appellant's first two points of error and appellees' counter-point is whether a worker who is retired on a pension at age 65 as required by Employer's compulsory retirement rule and pension plan so that she is out of employment has left work voluntarily and without good cause connected with her work under the terms of Art. 5221b--3. Additional facts to be considered are that the employee knew of the pension plan and retirement rule during the years of her employment and her bargaining agent had on her and the other union members' behalf entered into the agreement in evidence concerning the pension plan.

The parties agree that this is a case of first impression in Texas . However, there are a number of out of state cases which have passed on the question or one similar in principle, and there appears to be a definite difference of opinion on the answer.

The leading cases in support of the position taken by the Commission and the trial court are Bergseth v. Zinsmaster Baking Company, 1958, 252 Minn. 63, 89 N.W.2d 172, and Stream v. Continental Machines, Inc., 1961, 261 Minn....