Walgreen Co. v. Murphy

• Decision Date: 16 March 1944
• Docket Number: No. 27319.,27319.
• Citation: 53 N.E.2d 390,386 Ill. 32
• Parties: WALGREEN CO. v. MURPHY, Director of Labor, et al.
• Court: Illinois Supreme Court

386 Ill. 32

53 N.E.2d 390

WALGREEN CO.

v.MURPHY, Director of Labor, et al.

No. 27319.

Supreme Court of Illinois.

Jan. 18, 1944.

Rehearing Denied March 16, 1944.

Certiorari by Walgreen Company against Francis B. Murphy, Director of Labor, and others, to review decision of Director of Labor finding certain of plaintiff's employees not ineligible for benefits under the Unemployment Compensation Act. From a judgment dismissing the writ of certiorari, plaintiff appeals.

Reversed and remanded with directions.Appeal from Circuit Court, Cook County; John Prystalski, judge.

Wolff, Keane & Gomberg and Julian A. Tishler, both of Chicago (Oscar M. Wolff and Thomas E. Keane, both of Chicago, of counsel), for appellant.

WILSON, Justice.

A judgment of the circuit court of Cook county quashed a writ of certiorari sued out to review the decision of the Director of Labor of the State finding 320 warehouse employees of the plaintiff, Walgreen Co., who had participated in a strike from July 31 to August 19, 1941, were not ineligible for benefits under the Unemployment Compensation Act. Plaintiff prosecutes this appeal. Walgreen Co. is an Illinois corporation engaged in the wholesale and retail sale of drugs and other merchandise commonly sold in retail drug stores. The corporation owns and operates approximately 240 retail stores. It also owns and operates a warehouse located at 4720 S. St. Louis avenue, Chicago, from which wholesale sales are made. July 2, 1940, the National Labor Relations Board found that the employees of the warehouse involved in this proceeding constituted a unit appropriate for the purposes of collective bargaining, and that the Chicago Drug Workers Association, Inc., was their exclusive bargaining representative. Subsequently, a writtencollective bargaining agreement was signed by the company and the association. On July 30, 1941, the association demanded a twenty per cent increase in wages for the employees represented by it. The demand was not granted, and on July 31, 1941, 280 employees of the warehouse stopped work and walked out of the warehouse. Other employees ceased work the same day, and the next day, additional employees failed to report for work. Approximately 320 employees went out on strike and about thirty employees represented by the association remained at work The striking employees did not return to work until August 19, 1941, following an agreement between the company and the collective bargaining agent representing them. The warehouse employees made application for benefits under the Unemployment Compensation Act for the period from July 31 to August 19, 1941. On September 9, a deputy designated by the Director of the Department of Labor made a determination, without notification to the company of a hearing, that the claimant employees were not ineligible for benefits under section 7(d) of the act. Ill.Rev.Stat. 1943, chap. 48, par. 223(d). The company appealed from this determination to the Director of the Department of Labor. The Director appointed a representative, a professor of economics, to hear the company's appeal. Considerable evidence was heard and, on April 27, 1942, the representative filed his report with the Director, who, on May 1, 1942, confirmed the report. The certiorari proceedings in the circuit court followed and resulted in a judgment confirming the decision of the Director of Labor.

The warehouse, located several miles from the principal office of the Walgreen company, consists of a two-story brick building, one block long and about three quarters of a block wide, containing approximately 300,000 square feet. Ray Phelps, general superintendent, supervises and manages the warehouse, devoting his entire time to warehouse operations. He performs no duties incident to the operation of the stores. The warehouse sells a general line of drugs and other articles now commonly found in drug stores. Specifically, it sells, some 5,000 different items to the company's retail drug stores, to sixty stores controlled by subsidiary companies, to 600 drug stores independent of the company and to 53 hospitals, country clubs and industrial organizations. For the year ending September 30, 1941, net sales of the warehouse aggregated approximately $23,000,000. Of this total, about $13,000,000 represented sales to retail stores of the company and the greater part of the remainder to other retail customers. The warehouse employs an average of 350 employees. It maintains and keeps its own records. The warehouse employs its own watchmen, engineers and maintenance crew. Other drug warehouses in the metropolitan area commonly operate as separate businesses. Retail drug stores in the Chicago area generally operate without a warehouse. The company's retail stores could operate if the warehouse ceased doing business. Similarly, the warehouse could continue to operate if the company's stores ceased operations. The retail stores continued normal operations during the strike and, apparently, could have continued to do so indefinitely. The relationship between the warehouse and the retail stores is no closer functionally than exists between independent drug wholesalers and their retail customers.

The company contends that the declaration of public policy in section 1 of the Unemployment Compensation Act, Ill.Rev.Stat.1943, chap. 48, par. 217, reflects the legislative intent to exclude from benefits persons voluntarily out of employment on account of labor disputes. In particular, it challenges the eligibility of the employees involved to benefits on the ground, among others, that their unemployment was due to participation in a stoppage of work, namely, a strike, resultant from a labor dispute at the ‘establishment’ or ‘other premises' where they were employed, within the contemplation of section 7(d) of the statute.

Recourse to extrinsic aids for construction in determining public policy becomes unnecessary where the statute, as here, specifically declares the public policy motivating the enactment of the ameliorative provisions of the Unemployment Compensation Law. ‘As a guide to the interpretation and application of this Act,’ section 1 declares the public policy of the State: ‘Economic insecurity due to involuntary unemployment has become a serious menace to the health, safety, morals and welfare of the people of the State of Illinois. Involuntary unemployment is, therefore, a subject of general interest and concernwhich requires appropriate action by the legislature to prevent its spread and to lighten its burden which now so often falls with crushing force upon the unemployed worker and his family.’ This declaration of policy expresses the legislative intention that only those who are involuntarily unemployed shall receive unemployment compensation. Caterpillar Tractor Co. v. Durkin, 380 Ill. 11, 42 N.E.2d 541. One who strikes becomes voluntarily unemployed. Kemp v. Division No. 241, 255 Ill. 213, 99 N.E. 389, Ann.Cas.1913D, 347. A strike in the labor sense is generally defined as a stoppage of work by common agreement of a body of workingmen for the purpose of obtaining or resisting a change in the conditions of employment. 15 C.J.S.,...