Chrysler Corporation v. Losada

135 N.W.2d 897, 376 Mich. 209, 1965 Mich. LEXIS 213

• Court: Michigan Supreme Court
• Decided: July 13, 1965
• Docket: Calendar 20, Docket .50,392
• Status: Published

Opinions

Smith, J.

This is an appeal from a circuit court order reversing an employment security commission appeal board decision which, itself, reversed a decision of a commission referee.

The issue was whether or not John Losada, claimant, was disqualified for unemployment benefits for allegedly failing without good cause to accept suitable work when offered him. Two days after layoff, Losada was offered a choice of two jobs, each somewhat different from his customary employment and each at an hourly rate slightly less than he had enjoyed before layoff.

Relevant statutory provisions read as follows:

“Sec. 29(1) An individual shall be disqualified for benefits: .

“(a) For the duration of his unemployment in all cases where the individual: * * * (5) has failed without good cause to accept suitable, worlc when offered him. * * *

“An offer of employment in the individual’s customary occupation, under the conditions of employment and remuneration substantially equivalent to those under which the individual has been customarily employed in such occupation, shall be deemed suitable worlc. In determining whether or not any worlt is suitable for an individual, the commission shall consider the degree of risk involved to his health, safety and morals, his physical fitness and prior training, his experience and prior earnings, his length of unemployment and prospects for securing locad work in his customary occupation, and the distance of the available work from his residence.” Michigan employment security act, CLS 1961, § 421.29, subd(1) (a) (5) (Stat Ann 1960 Rev § 17.531 subd [1][a][5]). (Emphasis supplied.)

Disqualification under this section depends upon two essential findings of fact: (1) that suitable work was offered; and (2) that claimant failed without good cause to accept. It seems patent that the first issue which must be determined is whether the work offered was suitable. If the work is found to be not suitable, there is no necessity to make a finding as to whether claimant failed without good cause to accept such work. If, on the other hand, work offered is found to be suitable then the issue of good cause must be determined.

Further, the section sets out in definitive fashion, guidelines to be used in determining suitability. As appears from the statutory, quote above, certain work is “deemed” suitable. In determining suitability, otherwise, the commission is required to “consider” a number of factors. The problem here is that neither the commission referee nor the appeal hoard appears to have considered either set of criteria of suitability in arriving at respective decisions. Both appear to have, centered the whole focus upon the issue of whether claimant refused to accept with good cause.

*

In each opinion (that of the referee holding for disqualification and of the appeal hoard, reversing) repeated references are made to the “good cause”issue in the findings of fact but none to the “suitability” issue. Nor does it appear in either opinion inferentially, by the manner in which the facts were discussed, that either agency viewed the facts from the standpoint of full statutory criteria. After discussing only the “good cause” issue, both opinions announce conclusions or holdings in statutory language as if both good cause and suitability had previously been decided as matters of fact. In view of the state of the record, therefore, we decline to enter upon a precedential decision of the issues, particularly where, as here, we would be interpreting suitability provisions of the statute for the first time. Before there can be conclusions of law, there must be findings of fact. Wickey v. Employment Security Commission, 369 Mich 487. Resultingly, the circuit court order reversing the appeal board and reinstating the referee’s decision must be reversed, the referee’s decision being deficient in law. On remand the circuit court will remand to the appeal board for further proceedings.

Reversed and remanded. No costs, neither party having succeeded fully.

T. M. Kavanagh, C. J., and Adams, J., concurred with Smith, J.

Souris, J.

After having been laid off in April, 1960, from his job as a cutter in the trim shop of plaintiff’s Dodge assembly division Losada was offered a job as a spot welder or a medium press operator in plaintiff’s Conant stamping' division, which is located in the same building complex as the assembly division in the Dodge main plant. He refused these jobs because taking them would have required him to leave the assembly division, in which he began employment by Chrysler in November, 1954, and to lose his seniority in that division, although he would be entitled in the stamping division to credit for the seniority he had accumulated in the assembly division. Donald Hawk, who works in the employment office of the assembly division, testified that the only circumstances under which Losada might return to the assembly division would be if Losada were laid off from the stamping division while there was a shortage of workers in the assembly division. In that case Chrysler is obligated by its collective bargaining agreement to offer work in the division in which new workers are required to employees in other divisions who have been laid off, before seeking workers from the general public. Thus, if Losada were laid off from the stamping division, and if there were a shortage of workers in. the assembly division, and if there were not enough other, laid-off workers with more seniority than Losada to fill the vacancies in the assembly division, then Losada would be offered work in the assembly division.

Losada was denied unemployment compensation benefits upon the ground that he refused without good cause to accept suitable work offered to him.¹ Mr. Justice Smith is correct in stating that such disqualification for benefits requires determination of two issues: (1) did claimant refuse an offer of suitable work, and (2) if so, was such refusal without good cause? I think, however, that Justice Smith errs in characterizing both of these issues as issues of fact.

Whether a claimant has been offered suitable work is indeed a question of fact. See Dynamic Manufacturers, Inc., v. Employment Security Commission (1963), 369 Mich 556, 560. This is made amply clear by the legislature’s provision of standards to be considered in determining suitability of proffered work:

“An individual shall be disqualified for benefits:

“(a) For the duration of his unemployment in all cases where the individual has: * * * failed without good cause to accept suitable work when offered him. * * *

“An offer of employment in the individual’s customary occupation, under the conditions of employment and remuneration substantially equivalent-to those under which the individual has been customarily employed in such occupation, shall be deemed suitable work. In determining whether or not any work is suitable for an individual, the commission shall consider the degree of risk involved to his health, safety and morals, his physical fitness and prior training, his experience and prior, earnings, his length of unemployment and prospects for'securing local work in his customary occupation, and the distance of the available work from his residence.

“Notwithstanding any other provisions of this act,, no work shall be deemed suitable and benefits shall not be denied under this act to any otherwise eligible’ individual for refusing to accept new work under any’ of the following conditions: (a) If the position offered is vacant due directly to a strike, lockout or other labor dispute; (b) if the remuneration, hours or other conditions of the work offered are substantially less favorable to the individual than those prevailing for similar work in the locality; (c) if as a condition of being employed the individual would be required to join a company union or to resign from or refrain from joining any bona fide labor organization.” CLS 1961, § 421.29 (Stat Ann 1960 Rev § 17.531).²

Justice Smith writes that neither the referee nor the appeal board passed upon the factual issue of whether Losada had been offered suitable work, but rather devoted their attention to the issue of good cause. While it is true that neither said in so many words that the jobs in the stamping plant were suitable, it is evident from a reading of the opinions that the jobs were considered suitable and that, therefore, attention was focused upon the question of good cause for refusal. However, inasmuch as this case of Losada must for another reason be remanded for further proceedings before the appeal board, at that time the board may make a specific finding as to the suitability of the job in the stamping plant.

As to the issue of good cause, however, it is an issue of law, in my view. Although the appeal board must determine the facts from which the conclusion of good cause or its absence is drawn, once the facts are found that conclusion remains one of law, not of fact, and is reviewed by us as such. See the discussion of our proper scope of review in such, circumstances in my opinion in Wickey v. Employment Security Commission (1963), 369 Mich 487, 493, as to which there was unanimous agreement by the Court.

The decisions of other jurisdictions construing unemployment compensation act provisions similar to the Michigan statute here involved confirm the conclusion that “good cause” is a question of law and not of fact. Thus in Barclay White Co. v. Unemployment Compensation Board of Review (1947), 356 Pa 43 (50 A 2d 336), the Pennsylvania supreme court reviewed a trial court decision upholding a board of review’s decision that an employee had not refused (p 45) “without good cause * * * to accept suitable work.” The employee had refused a job at a nonunion plant on the ground that to accept it would subject him to expulsion from his union. The Pennsylvania court noted that findings of fact supported by evidence were binding upon it in the absence of fraud. The employee did not argue that the offered work was not suitable, and the court found evidence to support a conclusion that it was indeed suitable. The court decided, however, that the employee’s refusal of the work was without good cause:

“The decisive question in ascertaining whether or not claimant is entitled to unemployment benefits for the three weeks in question is: Did he have ‘good cause,’ within the legislative intent, for refusing the ‘suitable work’ to which he had been referred? The unemployment compensation law contains no definition of ‘good cause,’ and, therefore, the duty devolves upon the courts to determine the intent of the legislature in the use of those words.” 356 Pa 43, 47 (50 A 2d 336, 339).³

Another example of an appellate court discharging the necessary legal function of defining “good cause” is found in Syrek v. California Unemployment Insurance Appeals Board (1960), 54 Cal 2d 519 (7 Cal Rep 97, 354 P 2d 625). The unemployment insurance code provided that an employee would be disqualified for benefits if he (p 529) “without good cause, refused to accept suitable employment when offered to him”. The appeal board had denied the employee benefits on the ground that his refusal to accept civil service jobs because he conscientiously objected to a required “loyalty oath” was without good cause. The appeal board was sustained by the trial court, which was reversed by the intermediate appellate court, whose opinion was adopted by the California supreme court in its affirmance (p 529):

“ ‘Section 1257 of the unemployment insurance code provides that: “An individual is also disqualified for unemployment compensation benefits if: * * * (b) He, without good cause, refused to accept suitable employment when offered to him, or failed to apply for suitable employment when notifiled by a public employment office.” Section 1258 of the same code defines “suitable employment,” so far as relevant here, as “work in the individual’s usual occupation or for which he is reasonably fitted. * * *” The work itself, which was offered to appellant, prescinding from the loyalty matter, seems to be conceded to have met the definition of “suitable employment.” But section 1257 recognizes a second element, that of “good cause.” The term is not defined in the code. We believe that the term “good cause” as used in the statute means an adequate cause, a cause that comports with the purposes of the-unemployment insurance code and with other laws'.. Regarding it so, we believe that appellant had good cause for his refusal, from the standpoint of public interest and from that of individual rights.’ ” 54 Cal 2d 519, 529 (354 P2d 625, 630, 631).

As was noted in Wickey, supra, a conclusion of law requires as a basis findings of fact. The record now before us does not provide an adequate factual basis upon which to draw a legal conclusion concerning the existence or absence of good cause for Losada’s refusal of work in the stamping plant. For example, no evidence was presented relating to the factual probability of Losada’s transfer back to the assembly division. Nor was there evidence presented as to the probable economic significance, in addition to the wage differentials mentioned by Justice Smith, of employment in the stamping division instead of the assembly division. It might be, for example, that work in one was relatively steady while the other was comparatively intermittent. Until a more comprehensive factual groundwork is laid, I would decline to pass upon the question of good cause, considering the inadequate factual record now before us, and so perforce would remand to the circuit court for its remand to the appeal board for further proceedings.

Black, J.

The respective opinions Justices Smith, Souris, and O’Hara have prepared leave me —with all outsiders — in that precedentary state of doubt which seems to plague the profession of Michigan more today than ever before. To puzzled lawyers, and to the employment security commission, it must be said that all we will have put forth in this case of Losada is a result; a result which will be determined only when the wheel of chance settles and stops as judicial signatures are counted in our conference room on July 13th next.

No member of the Court, writing so far, seems interested in direct quotation of what was actually presented to and decided by the appeal board. Here it is:

“The basic issue involved herein is whether or not the claimant failed without good cause to accept an offer of available suitable work and should be disqualified under the provisions of section 29 (1) (a) (5) of the act.

“We find that the refusal of jobs offered was with good cause and that such good cause was because acceptance thereof would have caused the claimant to lose his seniority in the plant in which he previously had been employed and for the type of work which he was performing at the time of his separation. It is accordingly held that the referee’s decision holding that the claimant would be disqualified under the provisions of section 29 (1) (a) (5) of the act cannot be sustained.

“The decision of the referee is hereby reversed.

“It is held that the claimant did not fail without good cause to accept suitable work on April 15, 1960 and that he will accordingly not be disqualified under the provisions of section 29 (1) (a) (5) of the act.”*

The quoted first paragraph presented the only controlling question the appeal board was asked to decide. Palpably, that question was one of fact. There being fair evidentiary support for the conclusions reached by the appeal board, I hold that the circuit court should have affirmed. My vote, then, is to reverse and remand for entry of order affirming the appeal board’s decision.

The decision of the appeal board appears in full as follows:

“This matter is before the board upon an appeal by the claimant from a referee’s decision dated July 21, 1960 which held as follows: “ ‘The notiee of redetermination is affirmed.

“ ‘Claimant failed, without good cause, to aecept suitable work on April 15, 1960, and he is disqualified as of that date for the duration of his unemployment.

“ ‘The wages lie earned with the Chrysler Corporation prior to that date may not be used to compute or pay him benefits.

“ ‘He did not establish a benefit year by the claim he filed April 19, 1960.’

“The claimant filed a new claim for benefits on April 19, 1960 following a layoff for lack of work with the Chrysler Corporation on April 13, 1960. On April 15, 1960 the claimant was offered work with his separating employer which he refused to accept and on May 9, 1960 the commission issued a notice of claim denied holding that the claimant refused without good cause to accept an offer of available suitable work with his separating employer and that he would be disqualified under the provisions of section 29 (1) (a) (5) of the act. On May 10, 1960, the claimant requested a redetermination whieh the commission issued on May 23, 1960 whieh affirmed its determination of May 9, 1960. On May 24, 1960 the claimant filed an appeal to a referee who, after hearings were held on June 29 and July 12, 1960, issued his decision of July 21, 1960 quoted above. The claimant then filed a timely appeal to this board.

“The claimant was employed by the Chrysler Corporation from November 29, 1954 until April 13, 1960 when he was laid off for lack of work. He actually last worked on April 8, 1960 and was absent from work on April 11, 1960 for personal reasons. When he reported for work on April 12, 1960 he was given a disciplinary layoff covering April 11, 12 and 13 of 1960 and as of that last date was laid off for laek of work. During his period of employment he worked as an assembler as well as a trimmer and cutter. At the time of his layoff he was classified as a trimmer and his base rate was $2.47 per hour. On April 15, 1960 he was called in by the employer and offered work as a press operator at the base rate of $2.32 per hour or as a spot welder at a base rate of $2.37 per hour. The two jobs which were available and which he was offered were in the same building but were actually in a different plant whieh operated in that building. One of the jobs offered was available on two different shifts and one of the shifts paid a premium of 11 cents an hour in addition to the rate of $2.37 per hour. The claimant refused to accept either of the jobs offered because if he had accepted one of them his seniority would have been transferred to the new plant and there would have been little likelihood of his recall to his former job. The claimant maintains that his experience was primarily as a trimmer and cutter and that he desired to maintain his recall to that type of work in the plant in whieh lie was last employed. At the hearing before the referee on July 12, 1960 the employer’s representative agreed in his testimony that the claimant’s seniority would be transferred to the new plant, that there would be very little likelihood of claimant being recalled foi his former employment and that he did not lose his seniority as a result of his refusal to accept the jobs offered.

“The basic issue involved herein is whether or not the claimant failed without good cause to accept an offer of available suitable work and should be disqualified under the provisions of section 29 (1) (a) (5) of the act.

“We find that the refusal of jobs offered was with good cause and that such good eatise was because acceptance thereof would have caused the claimant to lose his seniority in the plant in which he previously had been employed and for tbe type of work which he was performing at the time of his separation. It is accordingly held that the referee’s decision holding that the claimant would be disqualified under the provisions of section 29 (1) (a) (5) of the aet cannot be sustained.

“The decision of the referee is hereby reversed.

“It is held that the claimant did not fail without good cause to accept suitable work on April 15, 1960 and that he will accordingly not be disqualified under the provisions of section 29 (1) (a) (5) of the act.

“It is further held that the wages earned with the Chrysler Corporation prior to April 15, 1960 may be used as the basis for computing or paying benefits for any period subsequent to that date.

“It is also held that a benefit year may be established as a result of the claim filed on April 19, 1960.” (Emphasis supplied.)

1 The hearing referee denied benefits, but was reversed by the appeal board which was in turn reversed by the eircuit court.

2 As further indicating the factual nature of this inquiry, consider how the second paragraph of the above-quoted material was amended by PA 1963, No 226:

“An offer of employment in an occupation in the vieinity of his residence at which the individual earned wages in his base period under conditions of employment and remuneration substantially equivalent to those under which the individual has earned wages in such occupation during his base period, shall be deemed suitable work. In determining whether or not any other work is suitable for an individual, the commission shall consider the degree of risk involved to his health, safety and morals, his physical fitness and prior training, his experience and prior earnings, his length of unemployment and prospeets for securing local work in his customary occupation, and the distance of the available work from his residence.”

3 While we agree that the question of good cause is one for the Court, we do not necessarily agree with the Pennsylvania court’s determination in the Barclay White Co. Case.

Since the present opinion was written Justice Smith’s opinion has been amended so as to include full quotation of the appeal board’s decision.