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UNITED STATES STEEL CORPORATION v. COMMONWEALTH PENNSYLVANIA (06/13/74)

decided: June 13, 1974.

UNITED STATES STEEL CORPORATION, APPELLANT,
v.
COMMONWEALTH OF PENNSYLVANIA, UNEMPLOYMENT COMPENSATION BOARD OF REVIEW, APPELLEE



Appeal from the Order of the Unemployment Compensation Board of Review in case of In Re: Claim of Joseph Guzewicz, et al., No. B-114239.

COUNSEL

James T. Carney, for appellant.

Sydney Reuben, Assistant Attorney General, with him Israel Packel, Attorney General, for appellee.

Judges Crumlish, Jr., Kramer, Wilkinson, Jr., Mencer, Rogers and Blatt. President Judge Bowman did not participate. Opinion by Judge Wilkinson. Judge Mencer dissents.

Author: Wilkinson

[ 14 Pa. Commw. Page 7]

The raw facts of this important unemployment compensation case are not in dispute. The Bureau of Employment Security, the referee, and the Board of Review (by a divided vote of 2-1) awarded unemployment compensation based on the conclusion that claimants' unemployment resulted from a lockout. Appellant based this appeal on the ground that from the raw facts, the record will not support the Board of Review's conclusion that the unemployment resulted from a lockout. We cannot agree and must affirm the Board of Review.

The legal question for us to resolve is stated accurately in appellee's brief: "When the appellant ceased operations at its steel plant in anticipation of the expiration of a labor-management agreement, but in the absence of any strike notice or actual work stoppage by the claimants, is the unemployment of said claimants the result of a lockout within the meaning of Section 402(d) of the Law, 43 P.S. 802(d)?"*fn1

On May 24, 1971, the United Steelworkers of America, using appropriate provisions of their contract, notified appellant it would terminate the existing

[ 14 Pa. Commw. Page 8]

    contract on August 1, 1971, and requested meetings with appellant to negotiate a new agreement. On July 28, 1971, appellant proposed a new contract. On July 29, 1971, this proposed contract was rejected. Appellant made preparation for an orderly shutdown of its facilities by midnight, July 31, 1971. What are characterized in the stipulation of the parties as "intense negotiations" were taking place during this terminal period of the contract. On the evening of July 31, 1971, the union notified the appellant that it would postpone any strike action for a twenty-four hour period, and that its members would report to work.

Significantly, and from the other facts in the record, accurately, the stipulation expressly stated: "At no time during the period July-August, 1971, did these claimants or other Union-represented employees of the employer engage in a strike against the employer nor did the Union serve an official strike notice on their behalf." (Emphasis supplied.) An agreement was reached on the afternoon of August 1, 1971, before the expiration of the twenty-four hour period.

As a result of the orderly shutdown, properly characterized by the Board of Review as not being used by the company as a bargaining tool or weapon against the union, claimants' unemployment, beginning August 1, 1971, was the result of the action of the company. The Board of Review found this action to be a lockout within the definition of our Supreme Court in Vrotney Unemployment Compensation Case, 400 Pa. 440, 163 A.2d 91 (1960). We agree.

The test set forth in Vrotney by Justice Cohen, speaking for a unanimous court, is ". . . whether the work stoppage is the responsibility of the employer or the employees is reduced to the following: Have the employees offered to continue working for a reasonable time under the pre-existing ...


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