Murray Operation of the Tappan Co. v. Kentucky Unemployment Insurance Commission

583 S.W.2d 100, 1979 Ky. App. LEXIS 426
CourtCourt of Appeals of Kentucky
DecidedJune 8, 1979
StatusPublished
Cited by2 cases

This text of 583 S.W.2d 100 (Murray Operation of the Tappan Co. v. Kentucky Unemployment Insurance Commission) is published on Counsel Stack Legal Research, covering Court of Appeals of Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Murray Operation of the Tappan Co. v. Kentucky Unemployment Insurance Commission, 583 S.W.2d 100, 1979 Ky. App. LEXIS 426 (Ky. Ct. App. 1979).

Opinion

WHITE, Judge.

The Murray Operation of the Tappan Company (Tappan) appeals from an order of the Calloway Circuit Court affirming the right of certain Tappan employees to collect unemployment insurance benefits. Tappan contends that these employees are disqualified from obtaining such benefits because they were “voluntarily unemployed.” The case is one of first impression in Kentucky, calling for the court’s evaluation of several provisions of our unemployment insurance act.

The facts in this case are undisputed. All of the employees — appellees herein — are employed by Tappan and are members of Local 1068 of the United Auto Workers Union, with which Tappan has a collective bargaining agreement. This agreement was originally left out of the record but has since been added upon this court’s motion. Under the terms of the agreement, Tappan was required to shut down production for one week to enable the employees to take vacations. There is evidence that this one-week shutdown was also used for certain management objectives, such as maintenance and repair. On May 20,1977, Tappan posted notices informing its employees of the vacation shutdown from June 27 to July 5, 1977. In accordance with the agreement, Tappan posted sign-up sheets for those employees desiring to work during the shutdown. This notice, posted around June 17, stated that approximately 70 positions were available for the one-week shutdown.

Although all of the appellee-employees were aware of the list, none of them signed up to work. The reasons for such failure varied, although it does appear that more than 70 workers signed the list within a short time of its posting. Witnesses for Tappan did testify, however, that a later list was posted indicating the availability of more jobs during the shutdown.

None of the appellees were entitled to vacation pay. The record discloses that some of the appellees had only recently begun to work for Tappan, and thus were not eligible for vacation, while others, longtime employees of Tappan, had lost their vacation eligibility due to a 13-month strike which had ended several months before the shutdown period. This led the appellees to file for unemployment benefits for the one week of shutdown.

Tappan protested the claims filed against its account. The basis of this protest was that the employees were disqualified from unemployment insurance compensation due to KRS 341.370(l)(a) for failure to accept the work offered by the notices. After a hearing, however, the referee held that KRS 341.370(l)(a) was inapplicable because the bargaining agreement did not require the employees to accept substitute work in lieu of shutdown. On appeal, the Kentucky Unemployment Insurance Commission (Commission) affirmed the referee’s decision and adopted its findings.

[103]*103Tappan then appealed to the Calloway Circuit Court asserting that the agency decision incorrectly applied the law. It was Tappan’s contention that the employees were disqualified not only under KRS 341.-370(l)(a), but also because their union membership made them voluntarily unemployed during the shutdown. KRS 341.370(2)(e). It was further asserted that the employees had failed to make a reasonable effort to obtain suitable work and were thus barred from collection of benefits under KRS 341.-350(4). After evaluation of these arguments, however, the circuit court affirmed the Commission’s decision on the basis that the record disclosed adequate evidence to support eligibility.

On appeal to this court, Tappan argues that the decision below is clearly erroneous, not because the findings of fact were in error, but because the law was incorrectly applied to those facts. While that assertion does appear to be correct, infra, the initial problem is whether Tappan has waived certain theories of relief.

The transcript of the hearing before the referee indicates that Tappan’s theory of the case was based upon KRS 341.370(l)(a) as it related to the posted notices. Further, all of the documents filed at the administrative level reflect that Tappan’s ground of protest was that the appellees had refused an offer to work. The only indication of the other grounds now asserted by Tappan was the filing of the bargaining agreement. Upon such a record, it could be argued that Tappan has waived any arguments under KRS 341.350 and KRS 341.370(2). Cooper, State Administrative Law, Vol. 2 at 599 (1965). See also, Kentucky Unemployment Insurance Commission v. General Electric Company, Ky., 473 S.W.2d 808, 810 (1971).

The record does indicate, however, that the legal issues may ha ve been narrowed by the referee, rather than by counsel for Tappan. In any event, the issues presented under KRS 341.370(2) and 341.350 were briefed before the trial court, and the Commission has responded to those issues herein. These additional factors indicate that Tappan has properly put all of its arguments into issue. Cf., Kentucky Unemployment Insurance Commission v. General Electric Company, supra. Thus, all of the issues raised by Tappan in its brief to this court will be discussed below.

Tappan contends that unemployment benefits should be denied because ap-pellees were never unemployed. Tappan argues that the employment relationship continued to exist during the shutdown and appellees retained all benefits of employment; their status was merely that of employees on vacation without pay. Although we find appellant’s argument persuasive, we feel constrained by the holding in Kentucky Unemployment Insurance Commission v. General Electric Company, supra, to find the shutdown period as it related to these appellees to be a period of unemployment. Based on KRS 341.080(3), which defines the term “week of employment,” the Court in General Electric, supra, held that shutdowns result in unemployment where no vacation pay is awarded. However, the issue of whether such unemployment is voluntary and thus excluded from unemployment insurance coverage under KRS 341.370(2)(c) was left undecided.

KRS 341.370

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Related

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Bluebook (online)
583 S.W.2d 100, 1979 Ky. App. LEXIS 426, Counsel Stack Legal Research, https://law.counselstack.com/opinion/murray-operation-of-the-tappan-co-v-kentucky-unemployment-insurance-kyctapp-1979.