Watauga Industries, Inc. v. Harry W. Greenwell

CourtCourt of Appeals of Tennessee
DecidedJuly 19, 2000
DocketE1999-00699-COA-R3-CV
StatusPublished

This text of Watauga Industries, Inc. v. Harry W. Greenwell (Watauga Industries, Inc. v. Harry W. Greenwell) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Watauga Industries, Inc. v. Harry W. Greenwell, (Tenn. Ct. App. 2000).

Opinion

IN THE COURT OF APPEALS OF TENNESSEE AT KNOXVILLE June, 2000 Session

WATAUGA INDUSTRIES, INC. v. HARRY W. GREENWELL, et al

Appeal from the Chancery Court for Carter County No. 23028, 31265 and 21971 G. Richard Johnson, Chancellor

FILED JULY 19, 2000

No. E1999-00699-COA-R3-CV

Watauga Industries, Inc. appeals three cases consolidated in the Carter County Chancery Court involving unemployment benefits awarded to certain of its employees. In the first case (“Greenwell”), the Board of Review of the Department of Labor, Employment Security Commission, found the employees were entitled to unemployment compensation after they were locked out of the plant by Watauga during a labor dispute. The Chancery Court upheld that decision. Watauga appeals the Chancery Court’s judgment. The Chancery Court lacked jurisdiction to hear Watauga’s Petition for Certiorari because Watauga did not file its Complaint in Chancery Court within the statutorily mandated 30 days after the decision of the Board of Review became final. Therefore, we vacate the Chancery Court’s judgment in Greenwell and dismiss Watauga’s Petition. In the remaining two cases (“Anderson”), the Board of Review found the employees refused Watauga’s reasonable offers of return to work, and terminated their unemployment benefits as of the date of that refusal. The Chancery Court reversed and held that the employees were entitled to continued benefits because Watauga’s offer of a return to work was not reasonable. Watauga appeals the Chancery Court’s decision. We hold that the Chancery Court erred in reversing the Board’s decision as the record contains substantial and material evidence supporting the Board’s decision, and, therefore, we reverse the decision of the Chancery Court in Anderson.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Vacated in Part, Reversed in Part; and CaseRemanded.

D. MICHAEL SWINEY , J., delivered the opinion of the court, in which HERSCHEL P. FRANKS, J., joined, and HOUSTON M. GODDARD , P.J., filed a concurring opinion.

Michael S. Lattier, Kingsport, for the Appellant, Watauga Industries, Inc.

D. Bruce Shine, Kingsport, for the Appellees, Harry W. Greenwell, et al.

Paul G. Summers and Douglas Earl Dimond, Nashville, for the Appellee, Commissioner of the Tennessee Department of Labor and Workforce Development.

OPINION

Background

During the first week of January 1994, Watauga Industries, Inc. (“Watauga”)1 and its employees’ union, the United Textile Worker of America (“Union”), attempted to negotiate a new labor contract to replace the contract that was due to expire on Monday, January 10, 1994. On Saturday, January 8, 1994, the Union voted not to accept Watauga’s offered contract. On Sunday, January 9, 1994, Watauga notified its employees that the plant would be closed for one day for maintenance, beginning at 11:00 that evening, through Monday, January 10, 1994, the last day of the expiring contract. Watauga then shut down the plant during that period.

On Monday, January 10, 1994, while the plant was shut down, the Union voted to strike. In a letter to striking employees dated January 12, 1994, Watauga unilaterally implemented the first year of its final proposal and informed the employees that they would be permanently replaced if they did not return to work within two days. The Union and Watauga exchanged correspondence. While some of the employees returned to work, many did not, and Watauga hired permanent replacements for those who did not return. Those workers who did not return to work applied for unemployment compensation benefits from the Department of Employment Security (“the Department”).

The union contract specified that a plant closing for economic reasons could not be considered a lockout. Watauga contended that the plant closing on January 9, 1994 was occasioned by economic reasons and therefore was not a lockout. The Department’s initial determination was that the closing was a lockout, and the employees were awarded unemployment benefits. Watauga appealed the initial determination to the Appeals Tribunal. At the hearing before the Appeals Tribunal, the President of Watauga testified that he closed the plant for several reasons, including vandalism, the need to replace missing formulas that had disappeared during the vandalism and which were essential for production, and the Union’s vote not to accept the new contract. He argued again that the reasons for closing were economic, not a lockout. Various employees testified that damaged equipment at the plant predated the labor dispute and was the result of chronic and routine maintenance problems, not vandalism, and that the plant closing was a lockout. The Appeal Tribunal, in its decision of March 28, 1994, which was adopted and affirmed by the Board of Review on August 23, 1994, found:

FINDINGS OF FACT: The 116 claimants in this case are members of the United Textile Workers of America, Lee’s Dye Workers Local 843 who were last employed at Watauga Industries. The existing contract between the union and the employer was scheduled to expire

1 Watauga states in its appellate brief that the com pany is no lon ger in business.

-2- at midnight on Monday, January 10, 1994, and negotiations on a new contract had been taking place since December, 1993. On January 7, 1994, negotiations occurred at which the employer presented its final offer. No consideration was being given to an extension of the existing contract. On January 8, 1994, the union voted to reject that offer. The employer then decided to close the plant for the last day of production that remained under the existing contact [sic]. This action would not have been taken if the union had voted to accept the new contract. The next scheduled shift was to begin at 10:50 p.m. on January 9, 1994. Employees were notified that the plant would be closed on January 10, 1994, including the third shift on January 9, 1994, to avoid further theft of company property and/or vandalism. The employer’s attorney also notified the union’s international representative that the employer did not consider this to be a lockout. On January 10, 1994, the union voted on the question of whether to accept the employer’s proposal, or strike at the expiration of the contract. The vote was to strike. The union’s representative informed the employer’s general manager of the vote and asked whether the employees should report to work at 10:50 p.m. on January 10, 1994 for the period of time remaining under the existing contract. The general manager informed him that the employees should not report for work for that time. The employer would have resumed operations if the union had accepted the proposal. On January 11, 1994, the employer notified union members that it was implementing the first year of its final proposal, and gave the employees two days from the receipt of the notice to return to work or risk being permanently replaced. The employer began hiring replacement workers after those two days. On January 23, 1994, the union began offering to accept the terms of the employer’s final proposal. The employer informed the union that it considered the replacement workers that had been hired to be permanent employees. On January 29, 1994, the union voted to accept the employer’s final proposal. The employer agreed to re-call eleven employees and to place the remainder on a preferential re-call list. The union did not accept these terms and picketing has continued.

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Bluebook (online)
Watauga Industries, Inc. v. Harry W. Greenwell, Counsel Stack Legal Research, https://law.counselstack.com/opinion/watauga-industries-inc-v-harry-w-greenwell-tennctapp-2000.