Home REED NATIONAL CORP. vs. DIRECTOR OF THE DIVISION OF EMPLOYMENT SECURITY & others. [Note 1]

393 Mass. 721

November 5, 1984 - January 22, 1985

Hampden County

Present: HENNESSEY, C.J., WILKINS, LIACOS, ABRAMS, & LYNCH, JJ.

A determination by the board of review in the Division of Employment Security that a certain "stoppage of work" no longer existed as of a specified date, thus permitting the claimants to recover unemployment compensation benefits, was warranted by findings revealing that the board viewed a drop in production at one of the employer's plants and a decreased number of employed production workers, as compared with figures from the previous year, in the context of all the circumstances, including the over-all status of the corporation's operations. [722-723]

An employer's demonstration of a twenty-five percent drop in production in one of its plants, without more, would not warrant a conclusion that there was a "stoppage of work" as a matter of law, so as to preclude claimants from receiving unemployment compensation benefits under G. L. c. 151A, Section 25 (b). [724]

On an employer's appeal from a decision of the board of review in the Division of Employment Security concluding that a certain "stoppage of work" no longer existed as of a specified date, thus allowing the claimants to recover unemployment compensation benefits, there was no merit to the employer's contention that the board's decision violated public policy by forcing the employer to subsidize a strike against itself, where the board did not award benefits unitl the employing unit had returned to substantially normal production. [724-725]

CIVIL ACTION commenced in the Western Hampden Division of the Distict Court Department on November 20, 1981.

The case was heard by Sidney M. Cooley, J.

John T. Egan for the plaintiff.

Page 722

Willie Ivory Carpenter, Jr., Assistant Attorney General, for Director of the Division of Employment Security.


ABRAMS, J. The sole question on this appeal is whether there was a "stoppage of work" at the Westfield plant of the Reed National Corp. beginning the week ending August 8, 1981, so as to preclude the claimants from receiving unemployment benefits under G. L. c. 151A, Section 25 (b). [Note 2] In Reed Nat'l Corp. v. Director of the Div. of Employment Sec., 388 Mass. 336 (1983), this court held that the board of review (board) of the Division of Employment Security, in its first determination of this same issue, did not make findings sufficient to support its conclusion that there was no stoppage. Id. at 340. We therefore remanded the case to the board for further proceedings. Id. at 341. The board, on remand, reviewed the evidence and reaffirmed its original decision allowing the claimants to recover unemployment benefits. [Note 3] The decision was affirmed by a District Court judge and came here for direct review, pursuant to G. L. c. 151A, Section 42. We affirm.

We briefly reiterate some of the principles by which we are guided in reviewing the board's determination whether there was a "stoppage of work" under G. L. c. 151A, Section 25 (b). "A 'stoppage of work' begins with a 'substantial curtailment' of the employer's operations, and the stoppage of work ends when that substantial curtailment no longer exists." Reed Nat'l Corp., supra at 338. The question of a "substantial curtailment of the employer's operations, is primarily a question of fact for the board." Id. at 339. In reviewing this decision, we are mindful

Page 723

of the deference due the board's expertise, experience, and technical competence. See id. See also Director of the Div. of Employment Sec. v. Fingerman, 378 Mass. 461 , 463 (1979). We turn to the corporation's challenge to the board's decision.

On appeal, the corporation claims error in the board's decision on the grounds that the decision is unsupported by substantial evidence, is erroneous as a matter of law, [Note 4] and violates the public policy of this Commonwealth.

The corporation contends that the board, on remand, made no significant, additional findings to justify its second decision; in the absence of such findings, the company argues, "the agency's decision cannot stand even if supported by substantial evidence." Torres v. Director of the Div. of Employment Sec., 387 Mass. 776 , 779 (1982). In issuing its second decision, the board specifically noted the following findings: (1) five workers at the Westfield plant had been laid off due to lack of work prior to March 4, 1981, the day the strike began; (2) the corporation had relocated "a considerable, but unspecified, amount of work" from the Westfield plant to another of its plants during the disputed period; (3) the twenty-five per cent drop in production pertained to the Westfield plant only; and (4) "there [was] no evidence that the employing unit exceeded the time reasonably necessary . . . to . . . resume substantially normal production in August 1981 or did anything to continue the stoppage." The board's original decision and the additional findings reveal that the board viewed "the drop in production and the decreased number of employed production workers, as compared with those figures from the previous year, in the context of all the circumstances, including the over-all status of the corporation's operations" in determining whether there was a stoppage of work. Reed Nat'l Corp., supra at 340. We conclude, therefore, that the board made sufficient findings to warrant its determination that there was no stoppage of work.

Page 724

The corporation next argues that that decision is erroneous as a matter of law because "[i]t is not a large step for the Court to hold that a twenty-five percent decrease in production is a substantial stoppage of work." However, the "diversity of factual situations which might arise in future cases," see Westinghouse Broadcasting Co. v. Director of the Div. of Employment Sec., 378 Mass. 51 , 56 (1979), militates against the application of a simple formula in determining the existence of a "stoppage of work." Thus, the demonstration of a twenty-five per cent drop in production [Note 5] without more does not warrant the conclusion that there was a "stoppage of work" as a matter of law.

Contrary to the plaintiff's assertions, the decisions in Adomaitis v. Director of the Div. of Employment Sec., 334 Mass. 520 (1956), and General Elec. Co. v. Director of the Div. of Employment Sec., 349 Mass. 358 (1965), do not establish that the board's decision was erroneous as a matter of law. In Adomaitis, supra at 522, the disruption in delivery of materials to the company resulted in a thirty-five per cent drop in production. The board found no similar disruption here. [Note 6] In General Elec. Co., supra at 364, the employer was forced to relocate work to an outside entity; here, however, the board found that the plaintiff had relocated work to another of its own plants. See Reed Nat'l Corp., supra at 340 n.8. The plaintiff, in short, failed to convince the board that production was substantially curtailed.

Last, the plaintiff maintains that the board's decision violates the public policy of this Commonwealth. That decision, the plaintiff argues, "permits the intrusion of the state into the collective bargaining process as a direct ally of the Union and forces Reed National to subsidize a strike against itself." But

Page 725

the board did not award benefits until five months after the strike began, by which time the employing unit had returned to substantially normal production. Simply stated, there was no longer any strike which could be financed by the use of unemployment compensation funds. The decision of the District Court is affirmed.

So ordered.


FOOTNOTES

[Note 1] The other defendants are Henry J. Dugas, Jr., and nineteen other claimants seeking unemployment benefits.

[Note 2] General Laws c. 151A, Section 25 (b), as amended through St. 1967, c. 480, Section 3, provides in relevant part: "No waiting period shall be allowed and no benefits shall be paid to an individual under this chapter for -- . . . (b) Any week with respect to which the director finds that his unemployment is due to a stoppage of work which exists because of a labor dispute at his factory, establishment or other premises at which he was employed . . . "

[Note 3] "On remand the board of review may [make a determination] on the evidence in the record or on additional evidence. Alternatively, the board may send [the] matter back to the review examiner for a determination . . . on the evidence in the record or for an evidentiary hearing." Graves v. Director of the Div. of Employment Sec., 384 Mass. 766 , 769 (1981). See Manias v. Director of the Div. of Employment Sec., 388 Mass. 201 , 206 (1983).

[Note 4] These standards of review, set forth in G. L. c. 30A, Section 14 (7), are applicable to this dispute under G. L. c. 151A, Section 42. "Substantial evidence" means "such evidence as a reasonable mind might accept as adequate to support a conclusion." G. L. c. 30A, Section 1 (6), inserted by St. 1954, c. 681, Section 1.

[Note 5] This argument is especially unpersuasive in light of the board's specific finding that the twenty-five per cent drop in production applied only to the plaintiff's Westfield plant and did not include work sent to another plant. The plaintiff furnished no evidence suggestive of a drop in production in its entire operation.

[Note 6] Although the plaintiff introduced evidence that "[c]ertain truckers" refused to cross picket lines, the record does not indicate that materials failed to reach the Westfield plant.