Bruce Plastics, Inc. v. Unemployment Compensation Board of Review

621 A.2d 1130, 153 Pa. Commw. 439, 1993 Pa. Commw. LEXIS 82

• Court: Commonwealth Court of Pennsylvania
• Decided: February 10, 1993
• Status: Published

Opinions

NARICK, Senior Judge.

The question before this Court is whether the conditional offer to return to work by Patricia R. Auten and Láveme T. Pivirotto (representative Claimants), allows them to receive unemployment compensation benefits.

On February 9, 1990, BPI Acquisition Corp. (BPI) purchased the assets of Bruce Plastics, Inc. (Bruce). Bruce had been unionized for decades and at the time of the acquisition the United Electrical, Radio and Machine Workers of America (Union) was the certified representative of the Bruce employees. BPI offered employment to all of Bruce’s employees and extended recognition to the Union as the employees’ bargaining representative. However, before hiring Bruce’s employees, BPI advised each applicant that it would continue the same wages, benefits and other economic conditions as Bruce had, but that certain employment policies would be different than those of Bruce. BPI and the Union entered into a recognition agreement, whereby BPI would be allowed to set reasonable work rules, policies and regulations, governing the employees’ employment. Shortly after BPI commenced operations, BPI and the Union began negotiations over wages, hours and other terms and conditions of employment, to be embodied in a collective bargaining agreement (CBA). Little progress was made at the initial meeting.

The employees, apparently discontent with the lack of progress in negotiating the CBA, walked out on March 22, 1990. The walk-out was not authorized or instigated by the Union. Neither the Union nor the employees gave BPI notice of their intention to strike. The following day, forty-five of the fifty-one employees established a picket line and refused to return to work. The employees who continued working received the same wages, hours and other terms and conditions of employment as before the strike, i.e. the status quo was maintained.

At the April 4, 1990 negotiating session, the Union stated that the employees, including representative Claimants, would return to work under four conditions: 1) BPI must rescind its employee handbook; 2) frequent negotiating must occur; 8) BPI must implement a health plan; and 4) all employees who walked off the job be returned to work. BPI refused the offer and also advised the Union that it had hired permanent replacement employees. Striking employees made no further offer to return to work until June 27, 1990, when the parties entered into a written strike settlement agreement, providing for the return to work of its striking employees, effective July 10, 1990.¹

The representative Claimants had filed for unemployment compensation benefits on March 28, 1990, on the basis that they had become unemployed because of the March 22, 1990 work stoppage. The Office of Employment Security denied benefits. Representative Claimants appealed and after a consolidated hearing the referee allowed benefits for weeks ending March 24, 1990 to July 7, 1990. BPI appealed and the Unemployment Compensation Board of Review (UCBR) modified the referee’s decision, denying benefits for weeks ending March 24 through April 7, 1990 but granting benefits for weeks ending April 14, 1990 through July 7, 1990.

On appeal to this Court,² Bruce argues that the UCBR erred as a matter of law in holding that the representative Claimants were eligible for benefits because representative Claimants’ offer to return to work on April 4, 1990 was conditional. We agree.

Section 402(d) of the Unemployment Compensation Law (Law), Act of December 5, 1936, Second Ex. Sess., P.L. (1937) 2897, as amended, 43 P.S. § 802(d), provides, in pertinent part:

An employe shall be ineligible for compensation for any week—

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(d) In which his unemployment is due to a stoppage of work, which exists because of a labor dispute (other than a lock-out) at the factory, establishment or other premises at which he is or was last employed: Provided, That this subsection shall not apply if it is shown that (1) he is not participating in, or directly interested in, the labor dispute which caused the stoppage of work, and (2) he is not a member of an organization which is participating in, or directly interested in, the labor dispute which caused the stoppage of work, and (3) he does not belong to a grade or class of workers of which, immediately before the commencement of the stoppage, there were members employed at the premises at which the stoppage occurs, any of whom are participating in, or directly interested in, the dispute.

In Acme Corrugated Box Co. v. Unemployment Compensation Board of Review, 131 Pa.Commonwealth Ct. 251, 570 A.2d 100 (1990) (Acme II), we held that striking employees who are permanently replaced during a strike are ineligible for unemployment compensation benefits under Section 402(d) of the Law, until they make an unconditional offer to return to work. In Acme II, the work stoppage began on February 6, 1985, after the parties were unable to reach accord on a new CBA. Shortly thereafter, Acme began hiring permanent replacement workers. Employees made an unconditional offer to return to work on March 27, 1985. Acme refused this offer because it had hired permanent replacements.

The Union here, does not contend that it made an unconditional offer to return to work but that, in fact, it is not bound by the holding of Acme II because the representative Claimants’ employment had been severed by BPI’s hiring of replacement employees. In Acme II, we held that where an employer chooses to keep a replacement employee rather than permit a striking employee to return to work, the striking employee cannot be denied unemployment compensation, if the striking employee has made an unconditional offer to return to work. Here, there is no evidence that BPI would keep replacement employees if an unconditional offer was made. In fact, when the employees made the unconditional offer on July 27, 1990, BPI began laying off the replacement workers.

In T.B. Woods’ Sons Co. v. Unemployment Compensation Board of Review, 150 Pa.Commonwealth Ct. 217, 615 A.2d 883 (1992), we elaborated on the holding of Acme II and stressed that a return to work offer by the employees must be unconditional. If the offer is not unconditional, “the requirements of Acme II have not been met....” 150 Pa.Commonwealth Ct. at 223, 615 A.2d at 887. Because the representative Claimants’ offer to return to work required BPI to agree to four conditions, different than what existed at the time it took over Bruce, i.e., the status quo, the requirement of an unconditional offer as described in Acme II was not met.

Accordingly, we reverse.

ORDER

AND NOW, this 10th day of February, 1993, the order of the Unemployment Compensation Board of Review in the above-captioned matter is hereby reversed.

1 . Approximately twelve of the striking employees chose not to return to work. Some of the replacement employees were laid off so that the striking employees could return to their jobs.

2 . Our scope of review is limited to a determination of whether constitutional rights were violated, an error of law was committed or whether necessary findings of fact are supported by substantial competent evidence. 2 Pa.C.S. § 704.