Parks v. Employment Security Commission

398 N.W.2d 275, 427 Mich. 224

• Court: Michigan Supreme Court
• Decided: December 26, 1986
• Docket: Docket Nos. 73010, 75474, 75964, (Calendar Nos. 11-13)
• Status: Published

Opinions

Brickley, J.

In these three consolidated cases we are asked to consider under what circumstances the disqualifying provisions of § 29 of the Michigan Employment Security Act apply so as to disqualify a claimant from receiving unemployment benefits.

PARKS

Appellant Anne B. Parks began working for the Detroit Board of Education in 1935. In 1969, the Detroit Federation of Teachers was recognized by the employer as the bargaining unit of the employees. Under the collective bargaining agreement reached between the employer and union, each covered employee was required to pay union membership dues or agency shop service fees. Also, the agreement required the employer, upon notification and request by the union, to notify the employee of termination within sixty days if the dues were not paid. The agreement required the employer to terminate an employee who did not pay the fees within the sixty-day period. Appellant Parks was one of the covered employees, and thus the contract under which she worked required her to pay a service fee. Due to personal beliefs, she objected to the paying of service fees. Along with other employees, she challenged the compulsory service fee in a lawsuit initiated in 1969. In Abood v Detroit Bd of Ed, 431 US 209, 239; 97 S Ct 1782; 52 L Ed 2d 261 (1977), reh den 433 US 915 (1977), the United States Supreme Court held that it is constitutionally permissible to require employees to pay fees for the support of a union’s activities in the areas of collective bargaining, contract administration, and grievance adjustment.¹

After the Abood opinion was issued, appellant did not pay the service fee or any portion thereof to the union. Pursuant to the collective bargaining agreement, the union notified the employer that the fees had not been paid. The employer asked appellant to pay the fee, and, when it was not paid, the union requested that the employer issue a sixty-day termination notice. In 1978, the employer notified appellant that her employment would be terminated on March li, 1978, unless the fees were paid before then. When the fees were not paid, appellant was discharged on that date.

This Court upheld the validity of the discharge. Detroit Bd of Ed v Parks, 417 Mich 268; 335 NW2d 641 (1983). Appellant then filed a claim for unemployment benefits. The mesc initial determination was that appellant was not disqualified for benefits due to misconduct. The employer sought redetermination on the ground that claimant voluntarily left her job, but the mesc claims examiner affirmed the original determination, again finding no disqualification for misconduct. The employer then appealed to the referee who reversed and held that

claimant’s separation from her employment was a result of an action instituted by herself and is therefore a voluntary leaving without good cause attributable to the employer.

The referee further found that the disqualification provision of §29(l)(b) (misconduct) was inapplicable. This decision was affirmed by the board of review. The dissenting board member believed that appellant did not leave her work voluntarily because she was terminated. He also believed appellant was not disqualified for misconduct. In the opinion of the dissenting member, appellant’s refusal to pay agency service fees was, at most, a good-faith error in judgment or discretion which does not amount to misconduct under the act.

The circuit court affirmed, agreeing that there was a voluntary leaving because "claimant’s loss of prerequisites for continued employment (i.e., the payment of the agency shop fees) was not the result of a negligent act of omission, but rather the product of a voluntary choice with knowledge of the consequences.” (Emphasis in the original.) The court thus concluded that the board’s findings were supported by competent, material, and substantial evidence. The Court of Appeals, in a brief memorandum opinion, also affirmed on this basis. We granted claimant’s application for leave to appeal. 423 Mich 854 (1985).

LINDQUIST

Appellant Nancy A. Lindquist was hired by the City of Saginaw on August 23, 1971. On February 5, 1981, she was discharged from her employment by the city because she failed to maintain her permanent bona fide residence within the corporate limits of the City of Saginaw in accord with Chapter 3, § 115 of the Saginaw Administrative Code. Section 115 of the code provides:

Each city employee shall maintain a permanent and bona fide residence within the corporate limits of the City. Any employee who fails to comply with the provisions of this section shall be deemed to have abandoned such employment and shall thereafter receive no salary or wages from the City.

After being terminated, appellant filed an application for unemployment benefits with the mesc on February 10, 1981. The commission initially determined that she was ineligible for benefits, but upon redetermination ruled that she was not disqualified for misconduct because

[t]he rule regarding residency bears no relation to the work to be performed and therefore any violation of the rule cannot be considered misconduct in connection with the work. ... It is determined that claimant’s discharge was for reasons other than misconduct in connection with the work ....

The city then appealed to the referee who made the following findings of fact:

In January 1981 the employer was notified that the claimant was not complying with Section 115 of the Code. An investigation was conducted. The claimant indicated to the employer that she resided at 3122 Fulton Street, Saginaw, Michigan. The investigation disclosed that on October 21, [1977] the claimant moved from 3717 Huntly Road, Saginaw, Michigan to 3122 Fulton Street, Saginaw, Michigan. Both of these addresses are located within the corporate limits of the City of Saginaw. The investigation also disclosed that the property on Fulton Street in 1977 was owned by a Mr. Carl Brown; that in 1978 the property on Fulton Street was owned by Gladys Brown, and in 1979-1980 the home on Fulton Street was vacant. Later, on the death of Gladys Brown, the property on Fulton Street became the property of Barry Brown. In early February 1981 the property on Fulton Street was placed for sale.

Four years prior to the time of separation claimant and her husband sold their home. Her husband and children moved to 2657 Birch Point, Lupton, Michigan and claimant began to reside with her aunt at 3122 Fulton Street. The claimant traveled each weekend to Lupton, Michigan and remained with her family. The claimant also went to Lupton during the week in the event of her children’s illness or to engage in school or other activities.

The claimant’s aunt died in 1979 and claimant continued to reside at the Fulton Street address to prevent the building from being vandalized. Claimant paid no rent to Mr. Barry Brown, the executor of the estate of Gladys Brown. The claimant received mail at the Fulton Street address. The claimant voted in the City of Saginaw, and on her drivers license she lists the Fulton Street address.

The referee found that appellant was not a resident of Saginaw:

In this case, the claimant was not a bona fide resident because her address on Fulton Street was not her true home. Her true home was in Lupton, Michigan. It was at her home in Lupton, Michigan that her children and husband lived and where she intended to reside. She only lived in Saginaw for the purpose of being close to work. In addition, her address on Fulton Street was not her fixed home. It was her temporary home while she was away from her true home in Lupton. Her intent was always to return to Lupton. Nor was her home in Saginaw a permanent home. She never intended to remain at that place indefinitely into the future until a new residence was obtained because she already had a residence in Lupton. If the adage is true that "A person’s home is where their heart is,” claimant’s home was in Lupton because her heart was always with her husband and children. Also the intent of the claimant was to reside on Fulton Street only in an attempt to meet the requirements of the city charter. The claimant never intended the Fulton Street address to be her permanent address. It was a place to stay while she was away from Lupton. Thus, it was not a bona fide residence.

The referee concluded that appellant was discharged for misconduct connected with her work because she "failed to meet one of the requirements of the employer’s rules . . . .”

Upon the claimant’s appeal, the board of review agreed that the residency requirement was violated, but concluded that even if this constituted misconduct, it was not work-connected. The "violation of the requirement did not occur on the job, nor did it occur because of problems in connection with work or work performance.”

The dissenting member of the board of review believed that the misconduct was work-connected. He opined that the majority interpreted the "work connected” requirement too narrowly when it held that the misconduct must relate to work performance or an on the job violation. Appellant also could have been disqualified for voluntarily leaving her employment in the view of the dissenting member. He reasoned that there was not a constructive voluntary leaving because claimant was aware of the city’s administrative code provision which deemed a violation of the residency requirement to be an abandonment of employment.

The circuit court agreed with the board of review that appellant’s actions did not constitute disqualifying misconduct within the meaning of the mesa. Summary judgment was entered in appellant’s favor.

The Court of Appeals reversed. 139 Mich App 515; 362 NW2d 771 (1984). The panel affirmed the finding that appellant violated the residency requirement because it was supported by competent, material, and substantial evidence, and further concluded that

there was an intentional and substantial disregard of [appellant’s] obligation to her employer which could be considered misconduct. [139 Mich App 522.]

The Court of Appeals also determined that claimant was ineligible for unemployment benefits because she voluntarily left work without good cause attributable to the employer.

Loss of qualification for employment because of residency is in the control of the employee and falls within the meaning of "voluntary leaving without good cause attributable to the employer or employing unit” and is not "constructive voluntary leaving.” [139 Mich App 523.]

This Court granted claimant’s application for leave to appeal on December 11, 1985. 424 Mich 856 (1985).

DOLCE

Appellant² Dominick Dolce worked full time for Ford Motor Company from April 20, 1964, through November 30, 1977. Appellant was a member of the United Auto Workers Union and thus worked under the terms contained in the collective bargaining agreement between Ford and the uaw. The agreement provided:

An employee automatically shall be retired under the Plan on the earlier of:

(i) the first day of the month following his 65th birthday.

Notwithstanding the foregoing provisions the Company may allow an employee to delay his retirement beyond age 65 if the employee is on a skilled classification for which the Company determines that there are [sic] an insufficient number of available, qualified persons to meet its needs adequately, but not beyond the earlier age of 68 or the time the Company determines that it can otherwise adequately meet its needs on his classification.

Appellant was allowed to work three years beyond the ordinary retirement age of sixty-five, but on November 30, 1977, he was forced to leave work due to his age. The referee found that appellant was able "to perform suitable full-time work of a character which he is qualified to perform by past experience or training, and of a character generally similar to the work” performed for Ford. MCL 421.28(l)(c); MSA 17.530(l)(c).

Appellant thereafter filed an application with the mesc, seeking unemployment insurance benefits. The hearing referee found that appellant was eligible for benefits and not otherwise disqualified. The board of review reversed and, relying on Applegate v Palladium Publishing Co, 95 Mich App 299; 290 NW2d 128 (1980), lv den 409 Mich 904 (1980), held that "[mandatory retirement provisions under a collective bargaining agreement constitute a voluntary leaving of employment . . . .” The Wayne Circuit Court affirmed the decision of the board of review, believing itself bound to that conclusion by Applegate, supra. In a divided opinion, the Court of Appeals affirmed. Two members of the panel agreed with the conclusion reached in Applegate and also noted that the Legislature had amended § 29(l)(a) subsequent to that case (1982 PA 535), but did not change the result of Applegate. They viewed this as legislative acquiescence in the interpretation reached in Applegate. The dissenting member of the panel wrote that the rationale used in Apple-gate was rejected by this Court in MESC v Vulcan Forging Co, 375 Mich 374; 134 NW2d 749 (1965). Accordingly, he believed that Applegate was wrongly decided.

After the Court of Appeals denied rehearing, we granted the claimant’s application for leave to appeal. 424 Mich 856 (1985).

ANALYSIS

In 1936, the Michigan Employment Security Act became law. Section 2 of that act expresses the legislative policy sought to be achieved by the act.

The legislature acting in the exercise of the police power of the state declares that the public policy of the state is as follows: Economic insecurity due to unemployment is a serious menace to the health, morals, and welfare of the people of this state. Involuntary unemployment is a subject of general interest and concern which requires action by the legislature to prevent its spread and to lighten its burden which so often falls with crushing force upon the unemployed worker and his family, to the detriment of the welfare of the people of this state. Social security requires protection against this hazard of our economic life. Employers should be encouraged to provide stable employment. The systematic accumulation of funds during periods of employment to provide benefits for periods of unemployment by the setting aside of unemployment reserves to be used for the benefít of persons unemployed through no fault of their own, thus maintaining purchasing power and limiting the serious social consequences of relief assistance, is for the public good, and the general welfare of the people of this state. [MCL 421.2; MSA 17.502. Emphasis added.]

Section 29 of the act establishes instances in which those seeking unemployment benefits are disqualified.

(1) An individual shall be disqualified for benefits in the following cases in which the individual:

(a) Left work voluntarily without good cause attributable to the employer or employing unit. However, if the individual has an established benefit year in effect and, during that benefit year, has left unsuitable work within [60] days after the beginning of that work, such leaving shall not be disqualifying.

(b) Was discharged for misconduct connected with the individual’s work, or for intoxication while at work unless the discharge was subsequently reduced to a disciplinary layoff or suspension.

The appellant-claimant in Lindquist claims that she is not disqualified under either provision. We agree with the Court of Appeals that her violation of the residency requirement constituted misconduct within the meaning of the statute and thus do not decide whether there was a voluntary leaving.³

In Carter v MESC, 364 Mich 538, 541; 111 NW2d 817 (1961), this Court adopted the following definition of misconduct:

"The term 'misconduct’ ... is limited to conduct evincing such wilful or wanton disregard of an employer’s interest as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect of his employee, or in carelessness or negligence of such degree or recurrence as to manifest equal culpability, wrongful intent or evil design, or to show an intentional and substantial disregard of the employer’s interest or of the employee’s duties and obligations to his employer. On the other hand mere inefficiency, unsatisfactory conduct, failure in good performance as the result of inability or incapacity, inadvertencies or ordinary negligence in isolated instances, or good-faith errors in judgment or discretion are not to be deemed 'misconduct’ within the meaning of the statute.”

We believe that appellant’s failure to comply with the residency requirement constitutes misconduct within this definition.⁴ The appellant’s actions amounted to conduct showing a wilful disregard of her employer’s interest. The employer has a strong interest in seeing that its rules are uniformly applied and followed. The employer had the right to expect that its employees would abide by the residency requirement.⁵ Appellant had a duty and obligation to her employer to maintain her residency within the city limits. She was well-aware of this condition of her employment as evidenced by her attempt to sustain the appearance of residency in the city. That the employer chose to make this requirement a condition of continued employment tends to show the importance of the rule to the employer’s interest. See Rodgers v Commonwealth, 40 Pa Commw 552; 397 A2d 1286 (1979).

Furthermore, we would hold that the misconduct in this case was work-connected. We do not believe that the phrase ''work connected” should be so narrowly construed so as to apply to only misconduct occurring at the workplace. This construction would allow employees to engage in acts inimical to their employer’s legitimate interest outside the workplace and yet receive unemployment benefits when they are justifiably discharged. There are some occupations and professions in which the employer is entitled to expect certain standards of behavior both in and out of the workplace. Actions outside the workplace may, at times, be more detrimental than those that occur on the job. The residency requirement here was part of the city’s administrative code and applied to all employees who worked for the city. We would find that the violation of this provision was serious enough to constitute misconduct as that term has been interpreted and also conclude that the violation was sufficiently work-connected to justify a denial of unemployment benefits.⁶

In Parks, we also believe that the employee’s actions constituted misconduct and do not decide whether they would amount to a voluntary leaving. Appellant’s failure to pay the fees was based on her dispute with the union. No matter what the merits of this dispute are, her failure to pay any fee whatsoever was clearly a wilful disregard of the employer’s interest. The employer would have been in breach of its contract had it not terminated appellant. The employer had the right to expect that the fees would be paid. When they were not, the union exercised its contract rights and requested that the employer either collect the appellant’s fees or terminate her. Appellant’s continuing refusal to pay the fees even after receiving the termination notice put the employer in a position which would have compelled it to be in breach of its contract with the union had it not terminated her. This is sufficient to constitute work-connected misconduct.

We are not persuaded that appellant’s "good faith” dispute concerning the union’s ability to collect the fees is enough to make her action not misconduct. Appellant’s misconduct was intentional in the sense that she intentionally did not pay the fees. Thus, even if she had a good-faith belief that the fees need not have been paid, her intentional act of not paying them after receiving notice from her employer showed a wilful disregard of the employer’s interest.

We would also conclude that, contrary to appellant’s assertion, there is no constitutional violation in the denial of unemployment benefits under the circumstances of the case. In Abood, supra, the Court held that the constitution was not violated by the forced collection of fees by the union as long as the fees were used in the course of its duty as the exclusive collective bargaining representative. The Court also held, however, that there was an "impact” on First Amendment interests in the union shop arrangement

[t]o compel employees financially to support their collective-bargaining representative has an impact upon their First Amendment interests. An employee may very well have ideological objections to a wide variety of activities undertaken by the union in its role as exclusive representative. His moral or religious views about the desirability of abortion may not square with the union’s policy in negotiating a medical benefits plan. One individual might disagree with a union policy of negotiating limits on the right to strike, believing that to be the road to serfdom for the working class, while another might have economic or political objections to unionism itself. An employee might object to the union’s wage policy because it violates guidelines designed to limit inflation, or might object to the union’s seeking a clause in the collective-bargaining agreement proscribing racial discrimination. The examples could be multiplied. To be required to help finance the union as a collective-bargaining agent might well be thought, therefore, to interfere in some way with an employee’s freedom to associate for the advancement of ideas, or to refrain from doing so, as he sees fit. [431 US 222. Emphasis added.]

This "impact” on constitutional rights was "constitutionally justified” by the "important contribution of the union shop to the system of labor relations established by Congress.” Id.

We would hold that in this case the minimal effect on appellant’s First Amendment interests does not make the denial of unemployment benefits unconstitutional. We stress that appellant did not under Abood have a constitutional right not to pay the collective bargaining agency fees. The Supreme Court has only held that the forced payment of such fees may create a First Amendment "impact” or an "interference” with the freedom to associate. Thus, the requirement to pay agency fees does not, in our view, directly confront a constitutional right as was the case in Thomas v Review Bd of Indiana Employment Security Div, 450 US 707; 101 S Ct 1425; 67 L Ed 2d 624 (1981), where an employee who quit rather than violate his religious convictions was found to have been unconstitutionally denied unemployment benefits.

The state has an obvious interest in not using its moneys to pay unemployment benefits to those who are disqualified under the mesa. Also, the state has an interest in protecting employers from being required to pay a percentage of unemployment benefits to all those who object to complying with the employers’ policy.

The policy of the mesa embodied in §2 and disqualifying provisions in § 29 manifest the state’s interest in reserving unemployment benefits for those who are unemployed due to forces beyond their control. Also, the state’s interest in sound and balanced labor relations could be weakened if large numbers of workers displeased with union shop arrangements were able to have their period of unemployment financed by the state and their former employers. We would hold that any effect on appellant’s First Amendment interest is outweighed by the state’s interest in upholding the denial of benefits in this case.

In Dolce, the misconduct-disqualifying provision of the statute is not relevant, and the only issue is whether the appellant left work voluntarily within the meaning of § 29(l)(a).

Other jurisdictions that have addressed this, issue on the basis of disqualifying language similar to that in Michigan’s statute have split. The leading case holding that there is no voluntary leaving when an employee is mandatorily retired pursuant to a collective bargaining agreement is Campbell Soup Co v Employment Security Bd of Review, 13 NJ 431; 100 A2d 287 (1953). The majority of cases since Campbell have followed it when faced with the same facts and similar statutory language. Reynolds Metals Co v Thorne, 41 Ala App 331; 133 So 2d 709 (1961), cert den 272 Ala 709; 133 So 2d 713 (1966); Employment Security Comm v Magma Copper Co, 90 Ariz 104; 366 P2d 84 (1961); Jenkins v Review Bd of Indiana Employment Security Div, 138 Ind App 12; 211 NE2d 42 (1965); Warner Co v Unemployment Compensation Bd of Review, 396 Pa 545; 153 A2d 906 (1959); Southwestern Bell Telephone Co v Employment Security Bd of Review, 210 Kan 403; 502 P2d 645 (1972); St Joe Paper Co v Gautreaux, 180 So 2d 668 (Fla App, 1965); Publishers Paper Co v Morgan, 10 Or App 94; 498 P2d 798 (1972); Duval Corp v Employment Security Comm, 83 NM 447; 493 P2d 413 (1972). The leading case holding that there is a voluntary leaving under these circumstances is Bergseth v Zinsmaster Baking Co, 252 Minn 63; 89 NW2d 172 (1958). Cases following Bergseth include: Kentucky Unemployment Ins Comm v Kroehler Mfg Co, 352 SW2d 212 (Ky, 1961); Lamont v Director of the Div of Employment Security, 337 Mass 328; 149 NE2d 372 (1958); Ivy v Dudley, 6 Ohio St 2d 261; 217 NE2d 875 (1966); McDonnell Douglas Corp v Labor Industrial Relations Comm, 592 SW2d 295 (Mo App, 1979).

The Campbell opinion reasoned that the unemployment statute is remedial in nature and should be liberally construed. The court also noted that an understanding as to the duration of employment should not mean the employee’s termination at the end of that period is voluntary. Employees are sometimes forced to accept jobs which their employers tell them at the time will engage their services for only a specific period. The voluntary acceptance of such work, knowing in advance its fixed duration, does not transform the termination at the agreed time into a voluntary leaving.

In Warner, supra, the court reasoned that an employee should not lose a statutory right to which he would otherwise be entitled merely because of a collective bargaining agreement between the union and employer. The theory that the employee has voluntarily agreed to quit cannot govern the determination under the statute because the pressures of the collective bargaining process are so complex. Looking to the collective bargaining process, rather than to the termination, would require an inquiry in each case to determine the position of each side at the bargaining table and even then a clear cut answer would probably not appear.

The Bergseth court reasoned that the employee had voluntarily left employment because of the union’s agreement with the employer. The employees elected to have a union be their representative with the employer and thus gave up their rights to deal individually with the employer. Any act by the bargaining agent is deemed to be a voluntary act of each member of the union which forecloses any subsequent claim by an employee that actions which are binding on him under the terms of the collective bargaining agreement are involuntary.

We have reviewed the decisions from other jurisdictions and conclude that the result reached by Campbell and the cases following it is more likely the result intended by the Legislature in the Michigan statutory scheme.⁷ We do not believe that the drafters intended to deny benefits from persons unemployed due to being mandatorily retired. We recognize that under Michigan law the union is the collective bargaining agent for all the employees and in many respects the employee is bound by and accountable for the actions of its bargaining agent. However, for purposes of determining voluntariness under the mesa, the collective bargaining process is too remote from the individual employees who come and go under it to allow those legislative presumptions under the state’s scheme of labor law to transform a forced retirement into a voluntary leaving.

The statute disqualifies those who have left work voluntarily. Dolce did not leave work voluntarily, but was forced to leave. Unlike, Parks and Lindquist, who wilfully disregarded a condition of employment, Dolce was helpless to stave off the aging process and his eventual termination. The presence of a union agreement with the employer does not change the relationship between the employee and employer with respect to this statutory inquiry. The language of the statute directs the inquiry to whether the worker left voluntarily and does not address any agreements between the employer and third parties.

As long as an employee does not voluntarily retire and otherwise meets the eligibility requirements of § 28 of the mesa, he will not be disqualified from receiving unemployment benefits when forced to retire under the terms of a collective bargaining agreement.

The judgment of the Court of Appeals in Dolce should be reversed and the case remanded for proceedings consistent with this opinion.

The judgment of the Court of Appeals should be affirmed in Parks and Lindquist.

Williams, C.J., and Archer, J., concurred with Brickley, J.

1 Without further comment, plaintiff, in the facts statement of her brief, states that she was willing to pay the collective bargaining share of the agency fees if they were separated from that portion of dues related to political and other activities not constitutionally extractable under Abood. The intended implication of this statement is unclear. However, we note that the propriety of plaintiff’s discharge is not at issue in this case.

Abood was remanded by the United States Supreme Court for the purpose of giving the parties an opportunity to pursue a procedure for extrapolating the constitutionally permissible portion of their dues. Parks was dismissed from that action on remand for lack of standing when she refused to adhere to the procedures for collection of agency fees. She did not appeal from that dismissal. It may be that plaintiff’s argument as to her discharge for failure to pay agency fees escaped Court of Appeals review in Detroit Bd of Ed v Parks, 98 Mich App 22; 296 NW2d 815 (1980) (see plaintiff’s application for rehearing), but it was without question not raised before this Court in that case. For a history of those proceedings, see Detroit Bd of Ed v Parks, 417 Mich 268, 270, n 1; 335 NW2d 641 (1983).

Similarly, during oral argument in the instant case, plaintiff’s counsel explicitly noted that Dr. Parks was not trying to relitigate Abood or challenge her discharge. He further admitted that the agency fee is constitutional and that plaintiff’s argument was not meant to suggest that the discharge was unlawful. Parks’ argument, instead, was directed solely at the issue addressed in this opinion.

Since plaintiff did not before this Court pursue the constitutional status of her discharge after her dismissal from Abood and is not contesting it now, we, for purposes of the disposition of this case, assume no constitutional infirmity in her discharge.

2 The plaintiff-appellant, Sophia Dolce, was substituted as plaintiff-appellant as the personal representative for her deceased husband on motion granted by this Court. For convenience, appellant will mean either the deceased or his personal representative.

3 We do note, however, that the characterization of the Saginaw City Charter that the failure to maintain a residency in the city is an abandonment of employment would not be relevant to resolving the question whether there was a voluntary leaving. A discharge for misconduct or other reason cannot be turned into a voluntary leaving merely by labeling it so.

4 Appellant further maintains that there was no violation of the residency requirement. The referee found as a matter of fact that appellant never intended to make the Fulton Street house her permanent home and that her intent was to return to Lupton to be with her husband and children. This conclusion is supported by competent, material, and substantial evidence on the whole record and is not contrary to law. It is thus sustained. Const 1963, art 6, § 28; MCL 24.306(l)(d), 423.216; MSA 3.560(206)(l)(d), 17.455(16).

5 The wisdom or validity of the residency requirement is not before us, but we do note that it is not unreasonable that a municipal government would limit the benefits of employment to those who reside within its borders and pay its taxes.

6 Reed v Employment Security Comm, 364 Mich 395, 396; 110 NW2d 907 (1961), is cited post, p 247, to support the view that plaintiffs refusal to abide by the residency ordinance was, even if misconduct, not "work related,” as § 29(l)(b) requires. In Reed, the employer established a rule "that an employee would be discharged from employment if a second writ of garnishment of his wages were served upon the company. Within a period of 9 months, 4 garnishments of plaintiffs wages were served on it. In consequence, he was discharged.”

This Court held that, while plaintiffs failure to pay his debts may have been wrong, it "was in no wise connected with his work, even though the consequences might in some manner affect his employer.” 364 Mich 397.

In this instant case, the “wrong” is not directed at third parties, but directly and solely at the interest of the municipal employer, which is supported by the taxes of its constituents and wishes to provide employment only to its constituents. While a failure to discharge third-party debts cannot be construed as "work-related,” the purposeful refusal to adhere to an ordinace in which the municipality, as an employer, has the sole direct interest cannot, in our view, be seen as anything but "work-related.”

7 MCL 421.27(f); MSA 17.529(f) deals with the payment of unemployment benefits to retired persons. Nothing in this section suggests an intent that the disqualifying provisions of § 29 are applicable to forced retirement situations. If the Legislature intends to have persons forced to retire disqualified under the voluntary leaving provision, its intent must be made more clear.