Sakrison v. Pierce, 5000

• Decision Date: 14 October 1947
• Docket Number: 5000
• Citation: 185 P.2d 528,66 Ariz. 162
• Parties: SAKRISON et al. (ARIZONA HOTEL ASS'N, Inc., et al., Interveners) v. PIERCE et al
• Court: Arizona Supreme Court

185 P.2d 528

66 Ariz. 162

SAKRISON et al. (ARIZONA HOTEL ASS'N, Inc., et al., Interveners) v. PIERCE et al

No. 5000

Supreme Court of Arizona

October 14, 1947

Appeal from Superior Court, Maricopa County; Dudley W. Windes Judge.

Proceedings by Everett H. Pierce and others for unemployment compensation, in which the Arizona Hotel Association, Inc. and another intervened. From a judgment, reversing an order of John Sakrison and others, as members of and constituting the State Employment Security Commission, denying the claims and directing payment of unemployment compensation benefits to claimants, the commissioners, the Westward Ho Hotel Company, and interveners appeal.

Affirmed.

Arthur M. Davis and D. Kelly Turner, both of Phoenix, for appellant Employment Security Commission.

Cunningham & Carson, of Phoenix, for appellant Westward Ho Hotel Co.

Jennings, Strouss, Salmon & Trask, of Phoenix, for appellant in intervention Arizona Hotel Ass'n.

F. Britton Burns, of Phoenix, for appellant in intervention Arizona Restaurant Ass'n, Inc.

Darrell R. Parker, of Phoenix, for appellees.

Udall, Justice. Stanford, C. J., and La Prade, J., concur.

OPINION

Udall, Justice.

As a result of a labor dispute existing between the Westward Ho Hotel Company and the Hotel & Restaurant Employees & Bartenders Union, Local 631, a strike was called, which went into effect on November 7, 1946. Ultimately 105 of the striking employees filed claims for unemployment compensation under provisions of art. 10, ch. 56-1001 et seq., A.C.A.1939, as amended by ch. 124, Laws 1941. Their claims were heard before the Principal Claims Deputy who rendered his decision authorizing payment of unemployment compensation benefits. On appeal, by majority vote, the Employment Security Commission reversed the Deputy and denied the claims, whereupon an appeal was taken to the Superior Court of Maricopa County. There, after hearing was had, judgment was entered reversing the decision and order of the Commission and directing that plaintiffs be paid the benefits provided by law. This appeal by the Commission, the Hotel Company and certain intervenors is from that judgment. The facts are not in dispute; the case involves only questions of law.

Primarily the question is whether under the proper interpretation of our Employment Security Act workmen who went out on strike that failed to effect, except temporarily, a stoppage of work at the employer's hotel are entitled to unemployment compensation for the period subsequent to the date that the hotel resumed normal operations.

Because almost every word in certain of the more controversial sections of employment security acts in the various states has been the subject of court litigation and interpretation, it is important at the outset to clearly delimit the boundaries of the present dispute. Plaintiffs do not question the existence of a "labor dispute," nor do they deny their participation therein. It is admitted that coincident with the commencement of the strike a picket line was established at the hotel entrances which is still in effect. They make no claim for compensation for the thirteen-day period during which the strike forced the hotel to drastically curtail its service to its patrons. They limit their claim for compensation to the period after the hotel had fully resumed operations by successfully replacing plaintiffs with other employees. It is stipulated that a stoppage of work has not existed at the employer's premises since November 19, 1946, and

"There is no contention that the dispute was caused by the failure or refusal of the employer to conform to the provisions of any agreement or contract between the employer and employees, or any violation of the laws of the State of Arizona, or of the United States pertaining to hours, wages or other conditions of work."

Appellants' (defendants' and intervenors') sole assignment is that the trial court erred in adjudging appellees (plaintiffs) to be entitled to unemployment compensation upon their respective claims for the reason that said claimants were not "unemployed" within the meaning of the Arizona Employment Security Act. While this assignment would seem to limit the scope of inquiry, yet in the briefs three other points are raised which it is urged would bar compensation, to wit: (a) That plaintiffs' unemployment, if such be found to exist, was not involuntary, and therefore not compensable by the Act; (b) that employees out on strike are not "available for work" under the terms of sec. 56-1004(c), and are, therefore, not eligible for compensation; and (c) that the term "stoppage of work" set forth in the statutory disqualification provision, sec. 56-1005(d) (hereinafter quoted), means the cessation of work by the employee rather than cessation or substantial curtailment of the operations of the employer's establishment. We shall discuss, in such order as seems best, each of the contentions raised by appellants.

Much is made in counsels' briefs of policy considerations. For example, on the one hand lies the charge that to allow compensation in such a case as this would be, in effect, to force employers and the state to finance a strike. On the other hand, it is claimed that to deny it would be to deny aid to those whom, among others, the Act was designed to protect (i.e., those who had participated in a labor dispute and lost -- at least to the extent that others now had their jobs and their former employer's operations had been fully resumed). And that finally, a denial of compensation would seriously cripple their unquestioned right to strike. At the outset it should be made clear that this court is not concerned with any questions relative to the merits of the labor controversy itself. Our decision is not and cannot be determined by such factors. Instead it is determined by the choice that the elected legislative representatives of the people of this state have made for us. And whether or not the Act should compensate employees in this position is properly a choice for the legislature. As a matter of fact, the legislatures of the various states are divided on this question -- some choosing one course, some the other -- while Michigan and California, at least, have chosen first one (each a different one) and then the other route. The function of this court, then, is simply to point out which route our legislature has chosen to travel. Though a matter of first impression in Arizona, deciding which route has been taken by a statute worded as ours is neither a new question nor is it one that requires abstruse reasoning or philosophical adventures. Our legislature has picked for its section on "disqualification" one of two usual types of wording, each of which is in wide use throughout the United States, and each, with but negligible exception, has been given a uniform interpretation. One would allow compensation in the case at bar; the other would not.

Specifically, appellants contend that sec. 56-1005(d) disqualifies the appellees from the benefits of the Act. That section, so far as here applicable, reads:

"Disqualification for benefits -- An individual shall be disqualified for benefits:

* * *

"(d) For any week with respect to which the commission finds that his total or partial unemployment is due to a stoppage of work which exists because of a labor dispute, strike or lock-out at the factory, establishment, or other premises at which he is or was last employed. * * *"

Appellants claim that read in the light of the policy of the Act to compensate only "involuntary unemployment," the phrase "stoppage of work" must refer to cessation of employee's labor and not stoppage at the place of employment, and, therefore, the fact that the hotel has resumed operations does not aid the employees in their claim for compensation.

As we have said, this disqualification clause is not peculiar to Arizona. Instead we are but one of over forty states that have copied in most respects the labor disqualification clause of the Social Security Board Draft Bill. See, Fierst and Spector, Unemployment Compensation in Labor Disputes, 49 Yale L. J. 461-491. But insofar as we have been able to find, the phrase "stoppage of work" has been interpreted by courts of last resort in only seven cases. In six of these, it has been held to mean stoppage of work of employer's establishment, not cessation of employees' labors. Lawrence Baking Co. v. Michigan U.C.C., 308 Mich. 198, 13 N.W.2d 260, 154 A.L.R. 660; Deshler Broom Factory v. Kinney, 140 Neb. 889, 2 N.W.2d 332; Magner v. Kinney, 141 Neb. 122, 2 N.W.2d 689, noted in U. of Chicago L.R. 75; Walgreen Co. v. Murphy, 386 Ill. 32, 53 N.E.2d 390; Saunders v. Maryland Unemployment Compensation Bd., Md., 53 A.2d 579; Carnegie-Ill. Steel Corporation v. The Review Board, etc., Ind.App., 72 N.E.2d 662. As was stated in Magner v. Kinney, supra [141 Neb. 122, 2 N.W.2d 692]:

"* * * In other words, the technical meaning of the term, 'stoppage of work' as used in our disqualification clause, is a substantial curtailment of work in an establishment, not the cessation of work by the claimant or claimants. The language of our unemployment compensation law quoted above (referring to a section identical with our 56-1005(b)) was a substantial reenactment of the English National Insurance Act of 1911. See Statutes 1-2 Geo. V, ch. 55, sec. 87, which was amended in 1924 by section 4(1), ch. 30, Statutes 14-15, Geo. V. This language, it appears, had received a settled construction (the same as that given by the Nebraska Court) by the English authorities charged with the administration of this English act long prior to the adoption of it by ourselves." (Explanatory inserts supplied.)

See also Lesser, Labor Disputes and Unemployment...