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FREDERICK UNEMPLOYMENT COMPENSATION CASE (03/20/68)

SUPERIOR COURT OF PENNSYLVANIA


decided: March 20, 1968.

FREDERICK UNEMPLOYMENT COMPENSATION CASE

Appeals by claimants, from decision of Unemployment Compensation Board of Review, Nos. B-96198-B, B-96196-B, and B-96204-B, in re claims of George Frederick et al.

COUNSEL

Emil W. Herman, with him Rothman, Gordon, Foreman and Groudine, for claimants, appellants.

Sydney Reuben, Assistant Attorney General, with him William C. Sennett, Attorney General, for Unemployment Compensation Board of Review, appellee.

Ernest S. Burch, with him Nauman, Smith, Shissler & Hall, for employer, intervening appellee.

Ervin, P. J., Watkins, Montgomery, Jacobs, Hoffman, and Spaulding, JJ. (Wright, J., absent). Opinion by Watkins, J. Dissenting Opinion by Hoffman, J.

Author: Watkins

[ 212 Pa. Super. Page 113]

These appeals are from decisions of the Unemployment Compensation Board of Review denying benefits to appellants under Act of December 17, 1959, P. L. 1893, § 401, § 4(u) and § 404(d), as amended, of the Unemployment Compensation Law, 43 PS §§ 753, 801, 804.

The Bureau of Employment Security denied benefits. Appellants appealed. The Referee reversed and allowed partial benefits. The company appealed and the Unemployment Compensation Board of Review reversed the Referee and denied all benefits. The Board made the following findings of fact:

"Claimant is employed by Liberty Mirror Division, Libbey-Owens-Ford Glass Company, Brackenridge,

[ 212 Pa. Super. Page 114]

Pennsylvania and his last day of work, for the purpose of this hearing was June 24, 1966 on which day claimant had a valid separation.

"Claimant is a member of the United Glass and Ceramic Workers of North America, AFL-CIO-CLC, Liberty Mirror Local Union Number 33.

"Claimant's working conditions are governed by a Labor-Management Agreement between his Union and the employer.

"The Labor-Management Agreement contains a section governing vacation for hourly employees. Claimant is an hourly employee. The vacation section in the Labor-Management Agreement reads in part as follows:

"12. Vacation for Hourly Employees. The Company will give each employee a vacation with pay sometime between the dates of January 1 and December 31 of each year based on previous service and conditions as outlined below: . . .

"When a department is closed down, all employees affected will receive their vacation bonus along with their regular check. This will not preclude any employee so affected from requesting a vacation at some other time during the vacation period.

"The company will endeavor to comply with the employees' vacation requests, but vacation scheduling must not interfere with plant operations. In either case, a reasonable advance notice should be given.

"All employees who have not received their vacation prior to July 1 of each year, will receive their vacation bonus on the last pay day in June.

"All vacation bonuses will be given when an employee takes his vacation, unless he has previously received same as outlined in preceding paragraph."

These findings of fact of the Board, if supported by the evidence, are binding upon this Court. France Unemployment Compensation Case, 205 Pa. Superior Ct. 505, 211 A.2d 85 (1965).

[ 212 Pa. Super. Page 115]

The evidence amply supports the findings in that the bargaining agreement and the historical application of the section dealing with vacations supports the company's authority to designate the plant or department shutdown period as the vacation period, even though the company subsequently allowed time off from work without pay when requested by employees if the production schedule was not unduly jeopardized.

The appellants, however, were entitled to just one week vacation and the shutdown covered a two week period. As was held in the Piestrak Unemployment Compensation Case (Susquehanna Collieries Division), 404 Pa. 527, 172 A.2d 807 (1961):

". . . First, as noted above, absence from work because of a plant shutdown for vacation does not automatically make an employee ineligible either as voluntary quit or as being unavailable for suitable work. Of course, his availability may still be questioned on an individual basis . . .

"We agree with the Superior Court's prior holding that the last of these standards must be given a reasonable interpretation. Otherwise, the receipt of a few dollars as vacation pay would serve to make the recipient totally ineligible for benefits, a result which we can not attribute to the legislature. We conclude further that the receipt of vacation pay is to be allocated to an actual vacation period and to be allocated within such period as the Department provides by its regulations; . . .".

The Bureau designated the first week as the vacation week for appellants in accord with its regulations, and the appellants, through their own statements, indicated their absence from their labor market area as their unavailability for work so as to render them ineligible for benefits during the second week of the vacation shutdown.

Decision affirmed.

Disposition

Decision affirmed.

[ 212 Pa. Super. Page 116]

Dissenting Opinion by Hoffman, J.:

On March 3, 1966, the Company posted a notice advising the employees that it had decided to shut down the plant from June 27, 1966 to July 11, 1966. The notice further stated that all of the employees must consider this period as their vacation, and that all vacations which had been previously approved were cancelled in light of a heavy production schedule. The union protested the designation of the shutdown period as a vacation by letter dated June 10, 1966.

The Company did shut down for two weeks beginning on June 27, 1966. Claimant Frederick, a production employee, was laid off, and, in accordance with § 12 of the Union-Company agreement, received his vacation pay.*fn1 On July 11, 1966, claimant asked for a vacation from November 28, 1966 through December 4, 1966, and the Company granted his request. Since he had already received his check for his vacation, he was given the above time off without payment.

Claimant filed for unemployment benefits for the two weeks that the plant was shut down, but was denied compensation by the Board on the ground that the period of June 27 through July 11, 1966 was an actual vacation period for which claimant was paid.

The majority today affirms the Board of Review's finding of fact, and, therefore, affirms the denial of benefits. I disagree.

The labor agreement specifically provides: "12. Vacation for Hourly Employees. The Company will give each employee a vacation with pay sometime between the dates of January 1 and December 31 of each year based on previous service and conditions as outlined below: . . .

[ 212 Pa. Super. Page 117]

"The company will endeavor to comply with the employees' vacation requests, but vacation scheduling must not interfere with plant operations. In either case, a reasonable advance notice should be given."

The labor contract here involved does not provide that the shutdown period must be considered a vacation period, nor does it authorize the Company to unilaterally designate such period as the vacation for each and every employee. In fact, the Company's general manager stated that there had been no formal documentation of a mandated vacation period. The record also indicates that the contract designates the right exclusively to the employees, and the Company can only accept or reject that choice.*fn2

Section 12 further provides: "When a department is closed down, all employees affected will receive their vacation bonus along with their regular check. This will not preclude any employee so affected from requesting a vacation at some other time during the vacation period. [Emphasis added]

"All employees who have not received their vacation prior to July 1 of each year, will receive their vacation bonus on the last pay day in June.

"All vacation bonuses will be given when an employee takes his vacation, unless he has previously received same as outlined in preceding paragraph."

[ 212 Pa. Super. Page 118]

In my opinion, these provisions provide for the method of payment for vacation time, but in no way designate the shutdown as "the" vacation time. In essence, the agreement states that an employee may, with the permission of the Company, take a vacation at any time throughout the year. If he has not taken one prior to July 1 of the year, he will receive payment for his vacation time on the last pay day in June, regardless of whether he requests and takes a vacation at a later time. If an employee has already had a vacation prior to July 1, he will already have received his vacation pay if requested, and, therefore, would not be entitled to vacation pay on the last pay day in June. Thus, the above provisions apparently serve only to expedite Company bookkeeping with regard to vacation bonus checks rather than setting up a compulsory vacation schedule.

The facts of the present case comport with this interpretation. Claimant Frederick requested his vacation*fn3 for the period from November 28 to December 4, 1966, and the Company granted it. Although Frederick received his vacation pay on the last pay day in June, the period in November and December should properly be designated as his "vacation." Furthermore, this interpretation follows the standards set forth in Piestrak Unemployment Compensation Case, 404 Pa. 527, 172 A.2d 807 (1961), wherein the Supreme Court stated: "We conclude further that the receipt of vacation pay is to be allocated to an actual vacation period. . . ." [Emphasis added] Accordingly, our Court reversed an order of the Board allotting vacation pay to a nonvacation period in Franceschi Unemployment Compensation Case, 196 Pa. Superior Ct. 150, 173 A.2d 774 (1961).

[ 212 Pa. Super. Page 119]

The unfairness stemming from the allotment permitted by the majority opinion may best be illustrated by considering the following situation.

A worker who had not taken his vacation prior to the last pay day in June would have received his vacation payment at that time. On the other hand, a worker who had taken his vacation in February would, if requested, already have received his vacation check. Consequently, for him, the closing of the plant from June 27 to July 11, 1966 would have constituted a shutdown which would entitle him to receive compensation benefits. Thus, the worker taking an early vacation would have received both vacation pay and compensation benefits while working fewer weeks than the worker who had delayed his vacation and worked more weeks. Moreover, the worker who had not taken his vacation prior to the plant closing would be entitled to vacation pay alone.

Although findings of fact of the Board are binding upon this Court, the question of whether one is "unemployed" pursuant to § 4(u) of the Unemployment Compensation Law is one that can only be made by reference to the statute. Thus, it is incumbent upon us to consider carefully the words of the labor agreement and surrounding circumstances to determine whether the present claimants are eligible for relief. Piestrak Unemployment Compensation Case, supra, at 537.


*fn1 The claims of appellants Anthony S. Bellavia and Donald L. Davis were consolidated for suit because the basic fact situations are similar. The facts and reasoning above thus apply with equal force to all claimants involved.

*fn2 The Union Representative testified that: "The normal policy has been that if a person is allowed to apply for a vacation and if production scheduling allows, these vacations are granted at that particular time anywhere from January 1st through December 31st. The vacation policy has always been that if there was a specific time posted in sufficient time the persons who didn't feel they could allow only additional time or had prior arrangements made, they would consider this their vacation. But, this did not exclude those from requesting a vacation at another time. . . . Many of our persons even though the notice was posted on the board there would be a shutdown period which would be considered as a vacation period, they would not be excluded from having a vacation at another time if they so desired."

*fn3 The fact that the label of the request slip was changed from "Vacation Time" to "Additional Time Off" in no way affects the merits of claimant's contentions in light of the Union-Company Agreement.


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