Peaden v. Employment Security Commission

96 N.W.2d 281, 355 Mich. 613, 1959 Mich. LEXIS 484
Michigan Supreme Court·Decided April 13, 1959·No. Docket 32, Calendar 47,676·Published·Cited by 36 cases

Opinions

Black, J.

Plaintiff-claimants were and are employees of defendant Calumet Division — Calumet & Hecla, Inc. They applied for unemployment benefits under the Michigan employment security act, alleging (as the issue comes here) eligibility for such benefits starting as of August 12, 1955, and continuing through September 10, 1955. The commission and hearing referee upheld claimants and directed payment accordingly. The appeal board, sitting in review, reversed these rulings and, by way of conclusion of its lengthy findings, ruled as follows:

[615] “It is held that the claiments were unemployed because of a work stoppage caused by a labor dispute in the establishment of Calumet Division, Calumet & Hecla, Inc., during the period beginning May 2, 1955, and ending at week ending September 10, 1955, ■and that the claimants are.disqualified from obtaining such benefits for the above-stated period under .section 29, subd (1) (b) of the act.” (CLS .1956, §421.29 [Stat Ann 1957 Cum Supp §17.531].)

Claimants thereupon sued out certiorari in the Ingham circuit to review the appeal board’s determination. The circuit court found no error and entered an order of affirmance. From such order •claimants have appealed to this Court.

The labor dispute viewed in the appeal board’s ■findings threatened and then critically affected the •economic welfare of what is known — in Michigan — ■ as “the Copper Country.” Comprising the counties ■of Houghton aiid Keweenaw and nearby territory, this is Michigan’s remote and geologically historic Keweenaw peninsula. For upwards of a.century the mining of copper and copper-bearing ores has furnished the leading source of employment and business in the area, and defendant Calumet has been the principal employer of copper miners and copper smelters therein. In most of the villages Calumet has provided and now provides necessary public utility services; also police and fire protection. It is in position to cut these services off at will. Here, indeed, will be found the substance of Ernie Ford’s “company town.” Comprehensive, then, is the picture of general economic woe in the copper country when Calumet is “down.” Understandable also is the fact that the labor dispute we are to consider — for the sole purpose of determining whether there is a -“rational basis”* for the conclusions reached by the [616] appeal board — was ultimately settled by jackscrew force of punitive and quite irresistible .sanctions.

Calumet operates “copper mines, smelters, a refinery, a railroad and other manufacturing installations in Houghton and Keweenaw counties.” Some 1,700 hourly-rated employees in its production and maintenance departments were and are represented by the United Steel Workers of America-CIO, hereinafter referred to as the union. A working contract, agreed upon by the union and Calumet in 1954, was due to espire April 30, 1955. The union desired to-“terminate, reopen, or amend” the contract and served notice to such effect on Calumet. Negotiations were opened in February of the year and continued without fruitful result until May 1st, on which date the union — these claimants participating — voted to strike Calumet. The strike was called for and commenced May 2d, and continued with developing bitterness* until August 10th, on which date the union voted “to reject the final offer” of Calumet. At this juncture the corporate hammerlock was applied to the Copper Country. August 12th (a Friday) Calumet caused to be published, in the Daily Mining Gazette of Houghton (the daily newspaper of the Copper Country), that which counsel refer to as “the liquidation order.” The salutation and pursuing declarations of such order portray graphically the overpowering play of the final hand. They read :

“To The People of the Copper Country:
“This letter is directed to the people of the Copper-Country for the purpose of informing them of the situation confronting the management of Calumet [617] & Hecla and to let them know immediately what action the management has found it necessary to take.
# # *
“In the current dispute with the union, we have sought all reasonable means to effect a settlement. "We have endured a long, costly and illegal strike. We have maintained pumping of the mines, we have kept the smelter furnaces hot, and have continued to operate the utilities vital to the communities in which we have operated. We have done these things in the hope that an agreement could be reached.
“As soon as it became possible, we made an offer which was as liberal as possible. There is a limit beyond which it is impossible to go. We have reached that limit. However, a substantial majority of the members of the union saw fit to reject our offer.
“In view of this clear-cut decision by the union, I have no alternative but to exercise the authority voted by the board of directors on May 26, 1955, to liquidate the Calumet Division. Accordingly, the following action is being taken:
“1. All presently employed hourly-rated and salaried employees not essential to the orderly liquidation of the division are being laid off. Those salaried employees who can be employed in other activities of the company will be transferred.
“2. All mine pumping is being terminated.
“3. Copper at the smelter will be refined and shipped and the furnaces shut down.
“4. The inventory of supplies will be sold.
“5. Machinery and equipment will be disposed of.
“6. The proper authorities in the communities will be notified that they must now take over the responsibility for utilities and services, such as pumping-water, and police and fire protection.
“Recognizing- its obligation to its employees and-the community, the management, since 1930, has struggled against terrific odds to continue operations.in the Copper Country. Investments in modern plant and equipment and in people have been made with the hope of reducing costs and maintaining a [618] profitable enterprise in this district. While progress, has been made, rising costs have kept pace with, operational improvements and the division has remained marginal. However, we recognize that in addition to our obligation to the employees and the community, we have a very important responsibility to our shareholders (the owners of the company). If we are unable to avoid loss, to say nothing of earning a reasonable return on the investment, it is the-duty of the management to act in the best interests-of the company,
“Calumet & Hecla has had an enviable and honorable record in the Copper Country for over 90 years. It is with heavy hearts that circumstances beyond our control have forced us to this tragic decision which we recognize will seriously affect the lives and fortunes of many innocent and loyal people.
“By authority of the board of directors,
E. R. Lovell, President”

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Peaden v. Employment Security Commission, 96 N.W.2d 281, 355 Mich. 613, 1959 Mich. LEXIS 484 (Mich. 1959).

96 N.W.2d 281 (Peaden v. Employment Security Commission) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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