MORIARITY et al.,
Appellees,
vs.
ELYRIA UNITED METHODIST HOME;
Administrator, Ohio Bureau
of
Employment Services,
Appellant
No. 92CA005357
COURT OF APPEALS OF OHIO, NINTH APPELLATE DISTRICT, LORAIN
COUNTY
621 N.E.2d 576, 86 Ohio App. 3d 502
February 24, 1993, Decided
APPEAL FROM JUDGMENT ENTERED IN THE
COMMON PLEAS COURT. COUNTY OF LORAIN, OHIO. CASE NO. 91CV07474
COUNSEL
Gregory J. Lavelle, for appellees.
Lee Fisher, Attorney General, and
Matthew J. Dolan, Assistant Attorney General, for
appellant.
JUDGES
Cook, Judge. Quillin, P.J., and Cacioppo, J., concur.
AUTHOR: COOK
OPINION
{*503} Elyria United Methodist Home ("the home") is a
nursing care facility for the elderly that employs approximately
two hundred fifty employees. Approximately one hundred fifty of
those employees were members of the Service, Hospital, Nursing Home
and Public Employees' Union, Local 47 ("Local 47"). One hundred
twenty-two members of Local 47 went on an economic strike on March
22, 1988. Prior to the strike, members of Local 47 received a
memorandum from the home informing them that "it is the intention
of the Home to permanently replace any employee who participates in
the strike immediately." That memo also stated: "any member of
Local 47 may continue to work during the strike. The Home hopes
that Local 47 members choose to do so." The memo also said that
home would provide transportation and assistance for those members
of Local 47 who wanted to cross the picket line.
The home began hiring permanent replacements on the first day of
the strike. The hiring of replacements was an ongoing process.
During the strike, eleven members of Local 47 crossed the picket
line and were returned to work. No members of Local 47 were refused
jobs during the strike.
{*504} On May 12, 1988, a settlement agreement was
signed and the strike ended. Seventy-one of the one hundred eleven
members still on strike were returned to work. The remaining
employees were put on a preferential recall list, pursuant to the
settlement.
The one hundred eleven striking members of Local 47 filed claims
for unemployment compensation for the weeks of April 16 through May
14. The Administrator of the Ohio Bureau of Employment Services
("Administrator") granted these claims. The home requested
reconsideration of the Administrator's decision. Pursuant to R.C.
4141.28(G)(2), the cases were referred to the Unemployment
Compensation Board of Review ("board") as a mass appeal. A hearing
was held in January 1990 and the board issued its decision in
October 1991 reversing the Administrator's determinations.
The claimants filed a timely notice of appeal to the Lorain
County Court of Common Pleas. The common pleas court reversed the
board's decision,> finding it unlawful, unreasonable and against
the manifest weight of the evidence. R.C. 4141.28(O). The
Administrator1 filed a timely notice of appeal to this court,
raising a single assignment of error. We reverse.
Assignment of Error
"The lower court's [ sic ] abused it's [
sic ] discretion reversing the unemployment
compensation board of review's decision which was lawful,
reasonable and supported by the manifest weight of the
evidence."
The Administrator argues that the common pleas court erred by
reversing the board's decision. He contends that the claimants'
unemployment was due to a labor dispute other than a lockout and,
therefore, under R.C. 4141.29(D)(1)(a), they were disqualified from
receiving unemployment benefits.
"The function of the court of common pleas, in determining
whether the board's decision is against the manifest weight of the
evidence, necessarily involves the exercise of sound discretion.
Accordingly, an order of the court of common pleas based upon a
determination of the manifest weight of the evidence, may be
reversed only upon a showing that the court abused its discretion.
See Rohde v. Farmer (1970), 23 Ohio St.2d 82 [52
O.O.2d 376, 262 N.E.2d 685]. In this context, the meaning of the
term 'abuse of discretion' connotes more than an error of judgment;
it implies a decision without a reasonable basis, one which is
clearly wrong." Angelkovski v. Buckeye Potato Chips
Co. (1983), 11 Ohio App.3d 159, 161-162, 11 OBR 242, 244,
463 N.E.2d 1280, 1283. See, also,
Lorain City Bd.
of {*505} Edn. v. State Emp. Relations Bd. (1988),
40 Ohio St.3d 257, 260-261, 533 N.E.2d 264, 266-268;
Galloway v. Unemp. Comp. Bd. of Review (July 5,
1990), Summit App. No. 14404, unreported, at 6, 1990 WL 95703.
R.C. 4141.29(D)(1)(a) states:
"* * * no individual may * * * be paid benefits under the
following conditions:
"(1) For any week with respect to which the administrator finds
that:
"(a) His unemployment was due to a labor dispute other than a
lockout at any factory, establishment, or other premises located in
this or any other state and owned or operated by the employer by
which he is or was last employed; and for so long as his
unemployment is due to such labor dispute."
"'The [unemployment compensation] act was intended to provide
financial assistance to an individual who had worked, was able and
willing to work, but was temporarily without employment through no
fault or agreement of his own.'" Irvine v. Unemp. Comp. Bd.
of Review (1985), 19 Ohio St.3d 15, 17, 19 OBR 12, 14, 482
N.E.2d 587, 589, quoting Salzl v. Gibson Greeting
Cards (1980), 61 Ohio St.2d 35, 39, 15 O.O.3d 49, 52, 399
N.E.2d 76, 79. There are several policy reasons behind the
disqualification for unemployment compensation for those involved
in a labor dispute. First, a striking employee's unemployment has
resulted from his agreement to go out on strike and he is not
willing to work. Second, as the sole contributor to the
unemployment compensation fund, an employer should not have to
finance a strike against itself. Annotation (1975), 63 A.L.R.3d 88,
105-106. Last, to preserve neutrality, the state should stand aside
in order that the labor dispute may not be financed through
unemployment compensation. Id.
We are required to determine whether the disqualification
provision of R.C. 4141.29(D)(1)(a) is applicable in this case. In
Baugh v. United Tel. Co. (1978), 54 Ohio St.2d
419, 422-424, 8 O.O.3d 427, 429-430, 377 N.E.2d 766, 767-769, the
Ohio Supreme Court stated:
"The disqualification provision of R.C. 4141.29(D)(1)(a) applies
only if 'unemployment was due to a labor dispute.'
We find that the words ' due to ' mean '
caused by.' They do not mean merely 'occurring
during the course of.' Thus, the element of causation is
indispensable. Hence, the vital question is not whether the
unemployment occurred in the course of the labor dispute, but
whether the unemployment was caused by the labor dispute.
"* * *
"Accordingly, we find that the General Assembly did not intend
that the statutory disqualification from unemployment compensation
benefits contained in {*506} R.C. 4141.29(D)(1)(a) be
applicable if, during the course of a bona fide
labor dispute, the employer terminated the employee status and
thereby caused the unemployment. In such an instance, although the
labor dispute directly caused the initial unemployment, the
statutory disqualification terminated with the severance of the
employee status. At that moment in time the direct cause of the
unemployment became the act of the employer. From then on the
employer's action and not the labor dispute was the proximate cause
of unemployment." (Emphasis sic.)
Thus, we must determine whether the employer's action caused the
termination of the claimants' status as employees. Baugh,
supra, at 424, 8 O.O.3d at 429, 377 N.E.2d at 769.
Contrary to the claimants' interpretation of
Baugh, that case does not stand for the
proposition that an employer terminates striking employees by the
mere act of hiring replacements. Hi-State Beverage Co. v.
Ohio Bur. of Emp. Serv. (1991), 77 Ohio App.3d 633, 642,
603 N.E.2d 274, 280. "The syllabus of Baugh has
the operative clause, '* * * preventing any volition on the part of
said employee to return to work * * *' as a qualifier to the act of
hiring permanent replacement employees." Id.,
quoting Baugh, supra. In Natl. Labor
Relations Bd. v. MacKay Radio & Tel. Co. (1938), 304
U.S. 333, 346, 58 S.Ct. 904, 911, 82 L.Ed. 1381, 1390, the United
States Supreme Court stated that the hiring of permanent
replacement workers does not in and of itself result in termination
of the employees on strike. See, also, Hi-State,
supra, 77 Ohio App.3d at 643, 603 N.E.2d at 281.
In Baugh, union members commenced an economic
strike against their employer in January 1972. The employer then
mailed a letter, dated May 25, 1972, to each striking employee
stating that an impasse existed and unless the striking employees
returned to work by June 1, 1972, the company would commence hiring
permanent replacement employees. Baugh, supra, 54
Ohio St.2d at 419-420, 8 O.O.3d at 427-428, 377 N.E.2d at 767.
Shortly after the June 1 deadline, each striking employee received
a second letter advising that he or she had been permanently
replaced. The court held that the labor law disqualification did
not apply because the employer's act of permanent replacement
prevented any volition on the part of the workers to return to
work.
In this case, prior to the strike, the home informed the
striking employees that it intended to permanently replace strike
participants immediately. The home began hiring permanent
replacements when the employees went out on strike. All of the
striking employees were not replaced immediately. Replacement of
employees was an ongoing process. Employees were never informed
that they had been replaced; they did not receive a second letter
informing them that they had been replaced as did the employees in
Baugh. Instead, employees were informed that they
could work during the strike and eleven employees who had
{*507} crossed the picket line mid-strike were returned to
work. At the end of the strike, seventy-one employees were returned
to work.
Applying the proximate causation test of Baugh,
we agree with the board's finding that the hiring of replacements
was not the proximate cause of the striking employees'
unemployment. The claimants have not shown that the employer's
action in hiring some permanent replacements prevented any volition
on each of the claimants' part to return to work. Unlike the
employees in Baugh, these claimants were not
informed that they were permanently replaced. None of the claimants
herein sought to return to work during the time period in question
nor have they shown that they would have been refused work had they
attempted to return. In fact, those employees who did attempt to
return to work during the strike were given jobs.
Further evidence that the claimants were not terminated from
their jobs by the home is: (1) the home informed the claimants that
they would be able to return to work after the strike if a position
was available, or as positions became available; (2) those
employees who were not returned to work immediately after the
strike were placed on a preferential recall list and (3)
seventy-one employees were returned to work immediately following
the strike. See Hi-State, supra, 77 Ohio App.3d at
642-643, 603 N.E.2d at 280-281.
Each claimant had the burden of showing that he was entitled to
unemployment compensation. Smith v. Unemp. Comp. Bd. of
Review (June 25, 1992), Franklin App. No. 92AP-276,
unreported, 1992 WL 142389. None of the claimants has shown that
the home's actions terminated his employment status thereby
becoming the direct cause of his unemployment preventing any
volition on his part to return to work. Accordingly, we find that
the common pleas court abused its discretion by reversing the
decision of the board which was lawful, reasonable and supported by
the evidence. R.C. 4141.28(O).
The assignment of error is well taken. The judgment of the trial
court is reversed. The case is remanded to the common pleas court
with instructions to remand to the Ohio Unemployment Board of
Review for further proceedings in accordance with this opinion.
Judgment reversed and cause remanded.
Quillin, P.J., and Cacioppo, J., concur.
DISPOSITION
Judgment reversed and cause
remanded.
OPINION
FOOTNOTES
1 R.C. 4141.28(O) states that any interested party, as defined in
R.C. 4141.01(I), may file an appeal of the board's decision to the
court of common pleas. R.C. 4141.01(I) defines the Administrator as
an interested party.