A-750 1400 Series

A-750-1404

Index No. 1545-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

January 23, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
MISREPRESENTATION
Self-employment

Appellate Division Decision

Matter of Bunzl, 1 AD 2d 46

MISREPRESENTATION – CONCEALMENT OF SELF-EMPLOYMENT

A claimant who is actively seeking a job does not wilfully make a false statement by certifying to total unemployment, although engaged at the same time in activities which constitute "self-employment" for the purpose of the unemployment insurance law, when the self-employment is such that an ordinary individual would not regard himself as "employed" under the circumstances and when claimant, in good faith, does not realize that the activities are "employment" under the Law.

Referee’s Findings of Fact: Hearings were held at which claimant, her attorney, witnesses and representatives of the employers and of the Industrial Commissioner appeared. Testimony was taken. Claimant, a designer, filed for benefits effective November 22, 1954. By initial determination effective the same date, she was ruled ineligible because of lack of total unemployment. She was ruled overpaid $180 and her benefits were ruled to be forfeited for 24 effective days because of wilful false statements made to obtain benefits. Prior to the filing in issue claimant was employed to November 17 as a designer. After she lost her job she attempted to find other employment. In applying to employers, it is customary for designers to submit sketches to enable the employer to evaluate their work. In November and December claimant applied to several employers. At one establishment, Fashion Wear Dress Company, she discussed with the designer the possibility of selling some of her sketches. No sales were made to that company by claimant. In the early part of December she applied to another employer, Miss Cane, Inc. She applied there because she learned that a designer who had been employed by that employer had left. She was interviewed and requested to submit sketches. The employer requested that she submit some sketches made specifically for it pursuant to its suggestions. On December 13 claimant submitted 12 sketches. She was told to submit additional sketches. On December 16 she submitted an additional seven sketches. At the time claimant was requested to submit the sketches she was told that she would be paid for the same at the rate of $3.50 per sketch. On December 16 when she brought the additional seven sketches to the employer, she submitted bills, one dated December 13 for 12 sketches, for a total of $42 and another bill dated December 16 for seven sketches totaling $24.50. The total of the two bills was subsequently paid to her by check. On December 23 she submitted five additional sketches and a bill for $17.50. This was paid to her on December 27. During the period that claimant submitted the sketches to Mss Cane, Inc., and received payment therefore, she certified to total unemployment. She also completed insurance office questionnaire forms indicating that she had not done any work during the period in question. She contended that she did not consider that the sketches she prepared for the employer and for which she was paid constituted work, because they were submitted in connection with her application for employment. She further contended that she would have made no claim for payment had the employer not been willing to pay for the sketches; that they were submitted solely to demonstrate to the employer her ability. The employer believed that the sketches were submitted pursuant to an arrangement whereby it would pay for them. During the entire period in issue commencing with November 22 claimant sought full time employment. She did not hold herself out as a freelance designer, but was willing to sell her design if anyone desired to purchase the same. Any sketches she made during that period were made primarily to demonstrate her ability to prospective employers rather than for the purchase of sale.

Referee’s Opinion and Decision: Claimant was totally unemployed during the period that she claimed benefits, except during the period when she prepared sketches for Miss Cane, Inc. and received payment for such sketches. During the periods prior and subsequent thereto the sketches she prepared were not made primarily for the purchase or sale, but to demonstrate her ability to prospective employers. Claimant first submitted sketches prepared specifically for that employer on December 13. At the time she prepared the sketches she believed that she was doing to indicate her ability to the employer. However, on December 13 she knew that she would be paid for such sketches. She also knew that she would be paid for the additional sketches requested by that employer. The work which she performed from December 13 through December 23 therefore constituted employment under the Unemployment Insurance Law. Claimant was not totally unemployed during that period. Claimant certified to total unemployment for the weeks ending December 19 and December 26 although she knew that she had done work specifically for one employer and that she had been or would be paid for such work. It is not material that claimant’s intention may not have been primarily to make the sale, but to obtain employment. She knew that she had worked and would receive remuneration for her work. It therefore follows that when claimant advised the insurance office with respect to such periods that she had done no work, she misrepresented. In order to find that the misrepresentation was wilful it is not necessary to show that claimant understood the materiality of her certification or representation. (Matter of Bernstein, 303 N.Y. 755, affirming 278 App. Div. 625, reversing Appeal Board, 22,265-50.) It is perhaps unfortunate that claimant did not realize that the work which she did for Miss Cane, Inc., constituted employment under the Law. However, she knew that she had performed work and had earnings, and it was therefore incumbent upon her to advise the insurance office of this. Because of her failure to do so, the insurance office was required to impose a forfeiture. The initial determination of lack of total unemployment is modified to be effective from December 13 through December 23 and, as modified, is sustained. Claimant was overpaid only for the weeks ending December 19 and December 26. The determination of wilful misrepresentation is sustained.

Appealed By: Claimant

Appellate Division Decision: The effect of the referee’s decision is that claimant was not totally unemployed from December 13^th through December 23^,1954; that claimant was overpaid for the weeks ending December 19^th an December 26, 1954, and that claimant had wilfully misrepresented that she was totally unemployed, for which a forfeiture of twenty-four effective days was imposed. Appellant contends that she was totally unemployed during the period in question, was not overpaid, and did not wilfully misrepresent. Claimant was a designer of women’s clothing. In seeking employment as a designer, claimant made sketches and submitted them to prospective employers as a sample of her work and ability, as was customary in that field. Early in December 1954, claimant called upon a dress manufacturer, Miss Cane, Inc., where she had heard there was no opening for a designer. At the interview she exhibited some of her sketches, and was requested by the President of Miss Cane, Inc., to submit additional sketches made specifically for that company. On December 13^th claimant submitted twelve sketches which were accepted, and she was told that she would be paid therefore and was requested to submit more. On December 16^th claimant submitted seven more sketches and two bills, one dated December 13^th for $42.00 and one dated December 16^th for $24.40. On December 23^rd, pursuant to suggestion, she submitted five additional sketches and a bill for $17.50. All of these bills were paid, and altogether claimant received from Miss Cane, Inc., the sum of $84.00 for sketches which she had made upon request. She was not employed as a designer by Miss Cane, Inc., then or later. We think these transactions which resulted in remuneration of $84.00 paid to claimant for work performed by her during a period of approximately two weeks clearly provides the necessary substantial evidence to support a finding that claimant was not "totally unemployed" during the period in question. The statutory definition is: "’Total unemployment’ means the total lack of any employment on any day. The term ‘employment’ as used in this section means any employment including that not defined in this title." (Labor Law, §522). The last sentence is very broad. If it be deemed that claimant was not in the employ of Miss Cane, Inc., under a contract of employment to make sketches for a remuneration, she certainly was not totally unemployed. If it be deemed that she was self-employed and merely sold the sketches to Miss Cane, Inc., she likewise was not totally unemployed. "Self-employment is clearly work for profit; one who is cannot claim any unemployment insurance benefits." (Matter of Emery [Corsi], 281 App. Div. 426). That portion of the decision which determines that claimant was not totally unemployed and was overpaid during the period in question should be upheld. The final part of the decision which imposes a forfeiture for wilfully making a false statement or representation to obtain any benefit presents a more difficult problem. Section 594 of the Unemployment Insurance Law (Labor Law, Article 18), provides, in part: "A claimant who has wilfully made a false statement or misrepresentation to obtain any benefit under the provisions of this article shall forfeit * * *." When claimant certified to total unemployment for the week ending December 19^th and December 26, 1954, she made a false statement – or at least it has been so determined, and we are upholding the determination. But was the false representation "wilfully" made? It is without dispute that claimant was conscientiously seeking full-time employment as a designer by a single employer during all of the period involved. It is undisputed that the making and showing of sketches was for the purpose of assisting her in obtaining such employment. In other words, she was looking for a job – she was not selling sketches. She did not get a "job" and had no "job" at the time she reported her total unemployment. She testified that she did not regard the incidental purchase of the sketches as employment. In fact, it does not appear in the record that she had been paid for the sketches at the time she made the misrepresentation. In such circumstances the every day understanding of the common man should prevail, and we do not think that the ordinary individual who was still looking for a job would regard himself as "employed" or "working." Claimant should not be held to a technical construction of "employment" as it is used in the Unemployment Insurance Law. There is no suggestion in the record of deliberate or intentional misrepresentation. Indeed, the referee states in his decision: "It is perhaps unfortunate that claimant did not realize that the work, which she did for Miss Cane, Inc. constituted employment under the Law." If she, in good faith, did not "realize" it, then she did not knowingly or wilfully misrepresent. Some element of scienter and knowledge of falsity or wrongfulness must be present. We said nothing to the contrary in Matter of Bernstein (Corsi), (278 App. Div. 625, aff’d. without opinion 303 N.Y. 755). In that case we said no "criminal intent" was required, and further: "if a claimant certifies to a false fact, knowing that it is false, the statute authorizes the forfeiture, regardless of claimant’s interpretation of the ultimate effect of his false statement." The Bernstein case is readily distinguishable factually. There claimant returned to his usual job, for the same employer who had laid him off two days before, and worked one day for which he was paid $23.00. At the end of the week he certified that he suffered total unemployment for the week. Here we do not think the record will sustain a finding that claimant "knew the statement was false." While ordinarily the question of whether a false statement was wilfully made would be one of fact, there appears to be nothing in this record to even permit an inference that knowledge of falsity or the essential element of wilfullness were present. The decision should be modified by reversing so much thereof as determines that claimant made a wilful false statement and imposes a forfeiture therefore, and, as so modified, the decision should be affirmed, with costs to claimant-appellant, and the matter remitted for proceedings in accordance herewith. (December 23, 1955)

COMMENTS

This decision deserves careful study and a re-reading of the release in the Bernstein case (A-750-986) is recommended. Particular attention should be given to the distinction which the Court makes in the case here reported: It concludes that claimant did not know that the statement by her was false.
It should be kept in mind that the concept of self-employment as constituting disqualifying "employment" is not clearly set forth in the Statute but has only been established by judicial interpretation. A claimant can hardly be charged with such legal insight. Therefore, in case of self-employment, a wilful false statement can, as a rule, only be made if claimant knows that his activities are "employment" for unemployment insurance purposes or when he makes false statements concerning facts within his knowledge (as differentiated from conclusions or interpretations) such as a denial of the ownership of a business, a denial of seeking out prospective clients, or an assertion of devoting time exclusively to job searches.
The Court in this decision re-affirmed the principle established in Matter of Emery (281 A.D. 2nd 426), that one who is self-employed is not totally unemployed. The decision here reported should not be construed as broadening the principles set forth in the above cited case or in the comments accompanying the release (A-750-1207).

A-750-1405

Index No. 1505E-3
1510.2

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

February 21, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
CLAIMS, REGISTRATION & CERTIFICATION
Misrepresentation or Misstatement
Penalty Period

Appellate Division Decision

Matter of Davis, 283 AD 908

MISREPRESENTATION; DISQUALIFYING ONESELF FROM RECEIVING BENEFITS

A false statement does not warrant the imposition of a forfeit penalty when claimant made the statement only to render himself ineligible to receive benefits; (for instant, alleging employment while claimant is incapable). (Matter of Davis, 283 App. Div. 908; Similarly, A.B. #52,064-55)

Referee’s Findings of Fact: A hearing was held at which claimant and a representative of the Industrial Commissioner appeared and testified. Claimant, a salesperson of ladies’ coats, suits and dresses, refiled for benefits effective March 23, 1953. By initial determinations effective May 18 she was ruled ineligible because of unavailability for employment and it was ruled that she forfeit 24 effective days for a wilful false statement to obtain benefits. Claimant was employed for six years, during the last part of which she worked short-time, due to the inability of the employer to furnish her with full-time employment. Short-time work is available during the busy season only. On May 25 claimant was asked about her job efforts and was unable to advise the insurance office where she had sought work. Beginning with May 26 claimant sought employment throughout the balance of that week. She was interviewed on May 29 for a job to which she was referred by the employment office and at which she started working on June 2. On May 18 claimant advised the insurance office that she had worked on May 17 and had earned $10 for such work. That statement was false. Claimant had been ill on May 17 and had been unable to report for work that day, although scheduled to do so. She advised the employer of the reason for her failure to report for work. She told the insurance office that she had worked on that day because she desired "to disqualify herself" because she knew she was not eligible for benefits.

Referee’s Opinion and Decision: Until May 26 claimant did not seek employment and did not establish her presence in the labor market. Since May 26 claimant has looked for work. She was hired following a job application she made subsequent to that date. I therefore believe that until May 26 claimant was unavailable and since May 26 she was available. There is no dispute that the statement claimant made to the insurance office on May 18 that she had worked on May 17 was false and it was known to her to be false. However, it was her intention not to seek credit for that day because of her illness, and that was the means she undertook to advise the insurance office of her ineligibility for that a day. Section 594 of the Unemployment Insurance Law provides for a forfeiture for a wilful misrepresentation to obtain any benefits. Claimant did not seek to obtain benefits by her false statement. Accordingly, no forfeiture for wilful misrepresentation should be imposed. Matter of Bernstein, 278 App. Div. 625, 303 N.Y. 755, rev’g. Appeal Board, 22,265-50, is distinguishable. The initial determination of unavailability, as modified, is sustained. The initial determination of wilful misrepresentation is overruled.

Appealed By: Industrial Commissioner

Appeal Board Decision: After a careful review of a record, testimony and evidence adduced before the referee, and due deliberation having been had thereon, and having found that the referee’s findings of fact and conclusions of law are fully supported by the evidence in this case, and that no errors of fact or law appear to have been made, the Board adopts the findings of fact and the conclusions of law made by the referee as the findings of fact and conclusions of law of this Board. The Board is of the opinion that the referee made proper findings of fact and correctly determined the issue involved in this case. The decision of the referee is affirmed.

Appellate Division Decision: Appeal by the Industrial Commissioner from a decision of the Unemployment Insurance Appeal Board which affirmed that portion of the decision of a referee overruling the initial determination of the Industrial Commissioner that claimant wilfully made a false statement to obtain employment insurance benefits. Claimant usually worked Saturdays and Sundays only. She reported to the local unemployment insurance office on May 18, 1953 and reported that she had worked on Sunday, May 17, 1953, and had earned $10 for that work. As a matter of fact she did not work on that day, but had called her employer’s place of business on that morning making this false statement because by so doing she was disqualifying herself for benefits for that day. She was afraid that if she stated that she was sick and did not work it would involve obtaining a doctor’s certificate and other complications. The Unemployment Insurance Law (Labor Law §594), provides: "A claimant who has wilfully made a false statement or representation to obtain any benefit under the provisions of this article shall forfeit * * *." The forfeiture imposed by the Industrial Commissioner in this case was for 24 effective days. Something more is required by the statute than a wilful false statement. It must be made "to obtain any benefits." Certainly the false statement there was not made to obtain any cash benefit, and we do not think the record discloses that it was made to obtain any benefit. It was really made to disqualify her from benefits for the day involved. We do not think that the false statement was made for the purpose which the statute requires, or comes within the spirit or intent of the statute necessary to work forfeiture. We do not hold that the false statement must be made to obtain a cash benefit, and we certainly do not condone making any false statement at all, but upon this particular record we do not think that a forfeiture was authorized. Decision of the Unemployment Insurance appeal Board affirmed, without costs (April 24, 1954)

COMMENTS

This Court decision was not previously released because it was based on a factual situation which it was believed would not easily recur. Since then, a few similar situations have arisen and the case has been cited in recent Referee and Appeal Board decisions. It is therefore felt that the local offices should be acquainted with the underlying principle involved.
The decision here released deals with facts and circumstances where it does not appear that the false statements were made for the purpose of misleading the local office regarding other periods during which benefits were claimed. If, however, it is found that a claimant had an ulterior motive in making a false statement, the purpose of which is to lead the local office in erroneously determining eligibility for benefits in such other periods, then, the decision would be inapplicable and it would be proper to impose forfeiture penalties.

A-750-1407

Index No. 1205F-6

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

February 21, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
REFUSAL OF EMPLOYMENT
During Period of Disqualification

Appeal Board Case Number 53,245-55

REFUSAL – DURING PERIOD OF INDUSTRIAL CONTROVERSY SUSPENSION

A disqualification may not be imposed for a refusal during a period of uncontested suspension from benefits because of an industrial controversy.

Referee’s Findings of Fact: A hearing was held at which claimant and a witness for the Industrial Commissioner appeared. Testimony was taken. A statement was submitted on behalf of the Industrial Commissioner in lieu of an appearance. Claimant, a millman, filed a claim effective September 12, 1955. Claimant last worked August 31. His place of employment went on strike starting September 1. As of October 5, the strike had not been terminated. Claimant stated at the hearing on October 31, that the strike was still in progress and he has participated in the picketing of his place of employment and expects to go back to his place of employment if and when the strike is settled. He states he will go back no matter where he is employed, when the strike is over. From the statement submitted by the Industrial Commissioner, it appeared that claimant’s benefits were suspended for seven weeks because of loss of employment due to an industrial controversy and claimant is not contesting the issue on the strike. By initial determination effective September 22, 1955, claimant was disqualified for refusal of employment without good cause. On September 22 claimant was referred to employment as a millman. The pay was $1.75 an hour for a 40-hour week. The job was in a union shop. Claimant would have to join the union which is a C.I.O. union. Claimant belongs to an A.F. of L. union. Claimant was hired to start work September 23. He reported for work on September 23 but refused to work, giving his excuse that he did not think he could do the work. He says that he would have to operate a shaper and he could not make the cutting knives for the machine. The employer reports the claimant stated he did not like the dressing room. The employer stated he did not blame claimant since claimant had worked in a beautiful shop with good working conditions.

Referee’s Opinion and Decision: At the time claimant was offered the employment in issue, there was an industrial controversy or strike going on in the establishment of his former employment which job he had had for 17 years. Claimant was participating in the strike and expected to return to the employment on settlement of the industrial controversy. During this period, claimant must be deemed to have a job or at least not to be in the labor market seeking employment elsewhere. He was given and accepted a suspension of any benefit rights he had during the seven-week period. In the first seven-week period, the strike was still in force. The suspension was still in effect on September 22. Claimant may not be disqualified for refusal to accept other employment during the seven-week suspension period because of the strike. Since claimant was not claiming or entitled to any benefits during this seven-week period, he could not be penalized for not taking other employment. Claimant refused employment with good cause. The initial determination is overruled.

Appealed By: Industrial Commissioner

Appeal Board Decision: A hearing was held before the referee at which all parties appeared and were accorded a full opportunity to be heard. A written statement submitted on behalf of the Industrial Commissioner was considered by the Board. After a careful review of the record, testimony and evidence adduced before the referee, and due deliberation having been had thereon, and having found that the referee’s findings of fact and conclusions of law are fully supported by the evidence in this case, and that no errors of fact or law appear to have been made, the Board adopts the findings of fact and the conclusions of law made by the referee as the findings of fact and conclusions of law of this Board. The Board is of the opinion that the referee made proper findings of fact and correctly determined the issue involved in this case, except that the Board’s decision is based solely on the fact that at the time of the refusal claimant had no benefit rights from which he might be disqualified. (Compare Matter of Foscarinis, 284 app. Div. 476, affirming Appeal Board, 35,617-53). The decision of the referee is affirmed. (December 23, 1955)

COMMENTS

This decision is not inconsistent with the principle that a disqualification may be imposed, when the refusal occurs during a disqualification period for voluntary quit or, after the filing of a claim, during a period of suspension because of misconduct. There is a marked distinction from these cases in that a definite break in employer-employee relationship occurs when the separation is due to a voluntary quit or misconduct, whereas such relationship continues while an industrial controversy is in progress. Under such circumstances it may reasonably be said that the individual is not an applicant for benefits until a claim is again filed after the suspension terminates. Thus, the principle stated in release A-750-1308 Rev., Matter of Foscarinis, cited by the Board, is applicable.
It should be noted that this case deals with a suspension which claimant did not contest. It may well be that the Board would not have reached the same conclusion if the claimant had disagreed with the suspension, and reported regularly at the local office pending final disposition of that issue. Thus, the claimant would have clearly remained an applicant for benefits. It seems that under such circumstances an additional determination disqualifying the claimant for refusal of employment would have been proper.

A-750-1408

Index No. 1105C-2
1185.3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

March 7, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
MISCONDUCT
Neglect of Duty

Appeal Board Case Number 53,843-55

MISCONDUCT – BREACH OF TRUST

A breach of trust resulting in termination of employment constitutes misconduct, even though the impropriety (falsifying records to signify usual closing time of a store rather than an actual earlier closing) is sanctioned by claimant’s immediate supervisor, who also disregards the employer’s interest.

Referee’s Decision: The amended initial determination of the local office suspending the accumulation of benefit rights for seven consecutive weeks on the round that claimant lost her employment through misconduct and the initial determination holding that she wilfully made a false statement for which a forfeiture of 20 effective days was imposed as a penalty is overruled.

Appealed By: Industrial Commissioner

Findings of Fact: We have reviewed the evidence adduced at the hearing before the referee and find that such evidence supports the following findings of fact made by the referee:

* * *

Claimant, a bakery sales clerk, filed effective October 11, 1955. By initial determination effective October 12 her benefits were suspended for seven weeks for loss of employment through misconduct. Her benefits were further forfeited for 20 effective days because of a wilful false statement to obtain benefits made on October 27. For four and a half years to October 11, 1955 claimant worked for a bakery chain store organization. On October 10 her hours of work were from 12 noon to 9 p.m. The store manager went off duty at 5:30 p.m. but returned to the store at about 6 p.m. She remained in the store until about 7 p.m. Business was slack and little merchandise remained to be sold. Claimant’s manager suggested to her that she close the store and telephone her husband to call for them and drive them home in his automobile. A rule of the company permitted the person in charge of a store to close before the regular closing hour of 8:30 p.m. if there was no further merchandise to be sold and upon obtaining the permission for such closing from the district manager or manager. At 6:30 p.m. the manager had taken a reading of the register which she entered in the time book as having been taken at 7 o’clock p.m. At 7 o’clock p.m. claimant took the final reading and indicated that she was going to enter that reading as of 7:30 p.m. The manager instructed her to indicate such reading as having been made at 8:30 p.m. Claimant then phoned her husband and after she and the manager closed the store he drove them to their homes. Shortly after 7 p.m. and again at 7:45 p.m. the district manager telephoned the store and when he received no reply, went there, arriving before 8 p.m. He found the store closed with a sign in the window that all of its products had been sold out and that it would be opened the following day. He entered the store and ascertained that there was some merchandise remaining to be sold. He telephoned the manager at her home and she informed him that she knew nothing of the store being closed. The manager then phoned claimant at her home, advising her of the telephone call from the district manager and her reply and instructed claimant to advise the district manager the following day that she had been ill and that she had closed the store early for that reason. On October 11 claimant went to the store and was dismissed by the district manager when she said that she had closed the store because she was ill and had been too ill to telephone the district manager to advise him of that fact. The conversation took place in the presence of the store manager who said nothing about having been present the evening before. Claimant said nothing of the manager’s presence and instructions the evening before because she did not believe that the employer would discharge her, and she did not want to jeopardize the manager’s employment. On October 27 claimant was interviewed in the insurance office and * * * she repeated her statement that she had been alone in the store on October 10 and that she had closed early because she was ill. On November 17 she signed another interview reciting that she did not earlier advise that the manager had been present in the store until it was closed because she did not believe it was necessary to mention that fact.

We make the following additional findings of fact: Claimant made entries in her time book to show sales up to 8:30 p.m. The referee overruled the said initial determinations, and the Industrial Commissioner appeals to the Board from said decision.

Appeal Board Opinion and Decision: Considering the facts in the light most favorable to claimant we cannot concur in the conclusion reached by the referee based thereon that claimant did not lose her employment through misconduct in connection with her employment and that she did not wilfully make a false statement on October 27, 1955 for the purpose of obtaining benefits which he based upon the premises that claimant’s acts were upon the instruction and consent of her supervisor and that her false statement was not made to obtain benefits but to save her manager from possible discharge. Claimant by admittedly closing the store while merchandise remained to be sold and falsifying her employer’s time records to signify that she closed the store at 8:30 p.m. and made sales to that time on October 10, 1955, when in fact she left such establishment at 7 p.m. displayed a wanton disregard of the employer’s interests and a breach of trust which justified her employer in discharging her which constituted misconduct under the Law. Claimant’s impropriety cannot be condoned because it was sanctioned by her immediate supervisor, who also disregarded the interest of their employer. Furthermore under the employer’s rules claimant herself was in charge of the store from six until nine, not her supervisor, who was off duty. Under the facts and circumstances of the present case, we believe that the local office properly suspended the accumulation of benefit rights by claimant for seven consecutive weeks effective October 12, 1955. Since claimant’s statements on October 27 that she was alone in the store and closed the store early because she was ill were known to her to be false, she was also properly charged with having made a wilful misrepresentation for the purpose of obtaining benefits. Even assuming that the referee’s conclusion as to claimant’s motive for making the false statements is correct, which is extremely doubtful (witness her subsequent statement of November 17), nevertheless, a person must be presumed to intend the necessary effects of his acts, and, if undetected, claimant’s false statement might have had the effect of avoiding a suspension or disqualification and, to that extent, of obtaining benefits for her. The amended initial determination of the local office suspending the accumulation of benefit rights by claimant for seven consecutive weeks effective October 12, 1955 on the ground that she lost her employment through misconduct in connection with her employment and the initial determination holding that she wilfully made a false statement on October 27,1955 for the purpose of obtaining benefits for which a forfeiture of 20 effective days was imposed as a penalty are sustained. The decision of the referee is reversed. (February 10, 1956)

A-750-1410

Index No. 1295-4

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

March 7, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
REFUSAL OF EMPLOYMENT
Other Reasons

Appeal Board Case Number 54,075-56

REFUSAL OF EMPLOYMENT – PHYSICAL EXAMINATION FEE

Refusal of employment is with good cause when claimant must pay for a physical examination in order to obtain the job.

Referee’s Decision: The initial determination of the local office disqualifying claimant from receiving benefits effective November 16, 1955 on the ground that, without good cause, he refused employment for which he is reasonably fitted by training and experience is sustained.

Appealed By: Claimant

Findings of Fact: We have reviewed the evidence adduced at the hearing before the referee and find that such evidence supports the following findings of fact made by the referee:

* * *

Claimant, an injection molder of plastics, filed a claim effective November 7, 1955. By initial determination he was disqualified as of November 16 because of refusal of employment without good cause. Before working as an injection molder claimant was employed for several years as a busboy. He resumed employment on December 14 in the post office. On November 16 claimant was referred to employment as an assembler of aluminum doors at $1.20 an hour. He went to the employer and was hired. The employer advised claimant to obtain an examination from his physician and to return the following day with the report. Claimant then refused the job because the work was different from his last employment, he did not wish to join another union and he did not desire to pay for the physical examination. In the last employment claimant earned $1.27½ an hour. This was unskilled work. In the job offered him he would be required to join the union within 30 days.

* * *

We make the additional findings of fact that the referee sustained the initial determination from which decision the claimant appeals to the Board.

Appeal Board Opinion and Decision: We agree with the conclusions of the referee that the employment offered claimant was one for which he is reasonably fitted by training and experience within the meaning of the Unemployment Insurance Law and that the wage offered to him was not substantially less favorable than that prevailing for similar work in the locality and that consequently the reasons advanced by claimant for refusing the offer of employment on such grounds were untenable. We also concur in the conclusion reached by the referee that claimant’s objection to joining a union was not justifiable reason to decline the offer of employment inasmuch as it was not shown that there would be any interference with his membership in another union. However, claimant also refused the proffered employment on the further ground that the employer required that he submit to a physical examination by his own doctor for which he was to pay the medical bill as a condition imposed for obtaining employment. In Appeal Board, 17,906-48 where the claimant in that case advanced a similar reason for refusing employment offered to him the Board held that he had good grounds for rejecting the proffered employment because it was unjustifiable to make him pay for a physical examination as a condition precedent to his obtaining the job. We, therefore, hold that the instant claimant had good cause, within the meaning of the Law, for refusing the offered employment for the reason indicated. The initial determination of the local office disqualifying claimant from receiving benefits effective November 16, 1955 on the ground that, without good cause, he refused employment for which he is reasonably fitted by training and experience is overruled. The decision of the referee is reversed. (February 10, 1956)

A-750-1418

Index No. 790.5

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT OF EMPLOYMENT
ADJUDICATION SERVICE OFFICE

May 11, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
DETERMINATION OF BENEFITS
AVAILABILITY AND CAPABILITY
Vacation Period

Referee Case Number OSR-200-56R

AVAILABILITY OF SEAMAN DURING A "TRIP-OFF" WITH VACATION PAY

A seaman who takes a "trip-off" in accordance with a union agreement requiring seamen to take a 38 day vacation from their regular vessel after a year’s continuous service thereon, is unavailable during such 28 days. He is not disqualified thereafter if his expectations for early employment are better by waiting to re-ship on his regular vessel, rather than by registering at the seaman hiring hall under forfeiture of his re-ship rights.

Referee’s Findings of Fact: Hearings were held at which claimant’s union representative and attorney and representatives of the Industrial Commissioner and of the employer appeared. Testimony was taken. Claimant, a marine electrician, filed for benefits at San Francisco, California effective October 17, 1955. An initial determination was issued ruling claimant eligible for benefits without disqualifying conditions. The employer protested, requested a hearing and made the statutory deposit. Claimant was employed aboard a vessel operated by the employer from 1942, until September 30, 1955, on which date he requested and was granted a leave for vacation purposes in accordance with the collective bargaining agreement and a union rule. The agreement provided that all seamen who are employed continuously aboard a vessel for 360 days are required to take a trip off for vacation purposes in order to spread the work among the unemployed seamen to maintain a large labor reservoir for the shipping industry. There were approximately 40,000 union members to fill 23,000 jobs and unless a system for sharing the work were adopted, many of the seamen who were unemployed, would leave the industry and thereby create a critical shortage in the first line of defense in emergency situations. Claimant was paid 38 days vacation pay from a pooled fund to which the employer contributed $1.25 a man per day. His vacation payment was computed on his average base rate during the vacation year and bore no relationship to the amount of payment made by the employer. The payments made by the employer were not earmarked for any specific individual but were placed in a pooled fund. However, according to the union shipping rules then in existence, claimant could not bid for any job coming into the union hall during the relief trip unless he desired to sacrifice his job and obtain employment with another contract employer. Claimant returned to work for his regular employer on November 28 the next voyage of the vessel after the completion of the round trip which started on October 1.

Referee’s Opinion and Decision: The employer protested the payment of benefits to claimant for the 38-day period for which he received vacation pay from his union through the pooled fund and argued that for that period, claimant was not eligible for benefits. The objection is well taken. For the 28-day period of his vacation pay through October 28, claimant had temporarily withdrawn from the labor market and consequently was ineligible for benefits. However, commencing with October 29, claimant was under no disability by his union rules from resuming employment with his employer. The only reason he could not return to the vessel was because it was at sea due to circumstances beyond his control. Claimant could obtain other employment by registering at the union hiring hall provided he was willing to give up his employment with his last employer. However, in view of the nature of the shipping industry and shipping conditions at the present time, claimant could not hope to reship prior to the time that he would be able to reship by waiting for the return of his regular vessel. Accordingly, I find that claimant had temporarily withdrawn from the labor market through October 28 but was available thereafter. It follows that any benefits which claimant received through October 28 constituted an overpayment. The initial determination of eligibility, as modified, is sustained. Since the initial determination was modified, the employer is entitled to a refund of its deposit.

A-750-1419

Index No. 1430-1
1450.3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

May 11, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
TOTAL OR PARTIAL UNEMPLOYMENT
Corporate Officers – Stockowners

Appeal Board Case Number 53,995-56

TOTAL UNEMPLOYMENT, QUESTION OF – UNSALARIED CORPORATE OFFICERS

An officer and stockholder of a corporation who renders appreciable services is not totally unemployed, even though, because of economic reasons, no salary is drawn.

Referee’s Decision: The initial determination of the local office holding claimant ineligible to receive benefits effective November 1, 1955 on the ground that she was not totally unemployed and the initial determination holding that as a result thereof she was overpaid the sum of $36 in benefits is overruled.

Appealed By: Industrial Commissioner

Findings of Fact: Claimant was employed for 21 months to August 5, 1955 as a controller-office manager. She has 11 years experience in that classification. Claimant filed a claim for benefits effective August 8, 1955 and registered for employment. On November 1, 1955 she invested $3,000 in a corporation which operates a retail store selling gift items. Claimant became vice-president and holder and owner of 50 percent of the issued stock. The president of the corporation owns the remaining 50 percent of the issued stock and devotes his full time to the business of the corporation. The store hours are from 10 a.m. to 6 p.m., Monday through Saturday. Claimant devotes all day Saturday and virtually every weekday from 3 p.m. to 6 p.m. to the store’s business. Her duties consist of keeping the books for the corporation and waiting on customers. Claimant is a signatory to the corporation’s checks. She and the president agreed that they would draw no salaries from the business at its inception. However, they further agreed that when business conditions warranted they would draw equal amounts without regard to the number of hours devoted to the business. Claimant restricted her search for employment to positions paying $7,500 per annum. Based on an interview with the claimant the local office issued initial determinations holding claimant ineligible to receive benefits effective November 1, 1955 on the ground that she was not totally unemployed and in the alternative, holding claimant ineligible to receive benefits effective November 1, 1955 on the ground that she was unavailable for employment and charging her with an overpayment of $36 in benefits by reason thereof. Claimant protested the determinations and requested a hearing before a referee. The referee overruled the initial determinations and the Industrial Commissioner now appeals to the Board from the decision of the referee insofar as it overrules that part of the initial determination holding claimant ineligible to receive benefits effective November 1, 1955 on the ground that she was not totally unemployed and the initial determination holding that as a result thereof she was overpaid the sum of $36 in benefits.

Appeal Board Opinion and Decision: The referee overruled that part of the initial determination of the local office holding that claimant was not totally unemployed on the premise that she became a stockholder and officer of the corporation for investment purposes only. The referee further concluded that the amount of time she devoted to the business was sporadic and limited. On the record we reach a different conclusion. Claimant was an officer of the corporation and was empowered to sign checks on its behalf. She devoted herself to the corporation’s business all day Saturday and virtually every weekday from 3 p.m. to 6 p.m. The services which claimant rendered were those of an active officer of a corporation. She spent a considerable amount of time (about 20 hours a week) at the corporation’s premises and rendered appreciable service in connection with its business. A statement submitted on behalf of claimant on February 28, 1956 indicates that she is still unemployed, a period of almost seven months. Although claimant contends that she drew no salary and no proof that she did was offered, nevertheless, claimant was in a position to have salary payments to herself arbitrarily manipulated as to certain periods in order to enable her to qualify for unemployment insurance benefits. It is significant that whereas claimant testified that she and the president of the corporation drew no salaries at the business’ inception, she further testified that if business conditions warranted, she and the president would draw equal amounts. She stated that this was so despite the fact that the president was engaged in the business on a full time basis. We accordingly conclude that claimant was in a position at any time to have payments made covering past services by causing payments for past services or increases to be voted at a meeting called for that purpose. To reason otherwise would permit claimant, the officer of a corporation rendering substantial services, to circumvent the spirit and intent of the Unemployment Insurance Law. Under all the circumstances herein, we are persuaded that claimant was not totally unemployed. That part of the initial determination of the local office holding claimant ineligible to receive benefits effective November 1, 1955 on the ground that she was not totally unemployed and the initial determination holding that as a result thereof she was overpaid the sum of $36 in benefits are sustained. The decision of the referee is reversed. (March 9, 1956)

A-750-1420

Index No. 1010-4

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

May 24, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
HEARINGS AND APPEALS
Limitation on Jurisdiction

Appeal Board Case Number 54,699-56

HEARINGS AND APPEALS—UNTIMELY CONTESTS

A timely hearing request from a notice of an overpayment does not permit a referee to take jurisdiction over the merits of the initial determination causing the overpayment, when the request is filed more than twenty days after the issuance of the original initial determination.

Appeal Board Decision

The Industrial Commissioner appeals from the decision of the referee dated February 28, 1956 ruling that claimant was entitled to a hearing on the merits as to the initial determination of the local office disqualifying her from receiving benefits effective November 23, 1955 on the ground that, without good cause, she refused employment for which she is reasonably fitted by training and experience and overruling said initial determination and the determination of the local office holding that claimant was overpaid $30 in benefits by reason of her disqualification.

A hearing was held before the referee at which all parties appeared and were accorded a full opportunity to be heard. A brief submitted on behalf of the Industrial Commissioner on this appeal was considered by the Board.

Based on the record and testimony in this case the Board makes the following

Findings of Fact: Claimant, a bookkeeper, filed an additional claim for benefits effective October 17, 1955 and registered for employment. She thereafter accepted a referral to employment and was interviewed by the prospective employer on November 22, 1955. She was hired and instructed to report for work on Monday, November 28. Instead, claimant returned to the employer’s establishment on November 23, at which time she spoke to the employer and stated that she intended to take time off from work in observance of her weekly Sabbath in addition to a number of other religious holidays. By letter dated the same day, the employer advised claimant to the effect that he had reconsidered his decision to hire her.

Based on an interview with claimant at the local office and a report received from the employment service, the local office issued an initial determination disqualifying claimant from receiving benefits effective November 23, 1955 on the ground that, without good cause, she had refused employment for which she is reasonably fitted by training and experience. A copy of the initial determination was mailed to claimant on November 28, 1955 and was received by her. Claimant at that time, without objection thereto, accepted the initial determination and did not request a hearing thereon within the statutory 20-day period.

On December 22, 1955 the local office issued a determination voiding the four effective days occurring in the week ending November 27, 1955, for which days claimant had received benefits subsequent to November 23 the effective date of her disqualification from benefits. As a result thereof, the determination held claimant to have been overpaid $30 in benefits. Following the receipt of the determination, which was mailed on December 22, claimant by letter dated December 28, 1955 requested a hearing before a referee " . . . so that I may explain this error in overpayment." The Industrial Commissioner raised the issue of timeliness with respect to claimant’s request for a hearing insofar as the initial determination disqualifying claimant from receiving benefits might be placed in issue by claimant’s request. The referee ruled that claimant was entitled to a hearing on the merits as to the initial determination of the local office disqualifying her from receiving benefits effective November 23, 1955 on the ground that, without good cause, she refused employment for which she is reasonably fitted by training and experience and thereupon overruled the said initial determination and the additional determination of the local office holding claimant was overpaid $30 in benefits as a result thereof. The Industrial Commissioner duly appealed from the decision of the referee to the Board.

Opinion: The referee, in ruling that claimant was entitled to a hearing on the merits as to the initial determination of the local office disqualifying her from receiving benefits for a job refusal without good cause, reasoned that the determination mailed to claimant on December 22, 1955, holding her to have been overpaid $30 in benefits as a result of the prior disqualification, revised the initial determination mailed on November 28, 1955, by ruling that claimant’s request for a hearing thereon was timely. We are not in accord with the referee’s reasoning and the conclusion based thereon.

Admittedly, claimant received the initial determination of the local office mailed on November 28, 1955 disqualifying her from receiving benefits effective November 23, 195. During the 20-day statutory period, within which time claimant could have requested a hearing before a referee (Unemployment Insurance Law Section 620.1), she raised no objection thereto and did not request a hearing. Her failure to act timely, foreclosed her from a hearing on the merits (Appeal Board, 1951-40) and the referee was without jurisdiction to rule on the issue raised by this initial determination.

Claimant’s letter of December 28, 1955 however, may be considered in relation to the determination issued and mailed on December 22, 1955, since her request for a hearing insofar as that determination is concerned was timely. However, the statement in the determination, that the overpayment of $30 in benefits resulted from the previous initial determination of her refusal of employment without good cause, was merely explanatory, designed to inform the claimant of the basis and reason for the overpayment as charged. It neither revised the original initial determination nor revived it. Although the referee had jurisdiction to render a decision on the merits as to the determination of overpayment, the scope of such decision may be limited to the issues of whether or not claimant was in fact overpaid any benefits and the amount thereof (Appeal Board, 49,687-55). Since claimant does not contend that she did not receive the benefits charged as an overpayment or that the amount thereof is incorrect, it follows that the determination mailed on December 22, 1955 must be sustained.

Decision: Claimant is not entitled to a hearing on the merits as to the initial determination of the local office disqualifying her from receiving benefits effective November 23, 1955 on the ground that without good cause, she refused employment for which she is reasonably fitted by training and experience, because she failed to request a hearing within the 20-day statutory period. Therefore the initial determination remains in effect. The determination holding that claimant was overpaid $30 in benefits is sustained.

The decision of the referee is reversed. (May 4, 1956).

A-750-1421

Index No. 1605F-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

May 24, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
VOLUNTARY LEAVING OF EMPLOYMENT
Voluntary Leaving or Refusal

Appellate Division Decision

Matter of Centonze, 54 AD 2nd 523

Appeal Board Case Number 44,733-54

VOLUNTARY LEAVING BONA FIDE EMPLOYMENT – VOLUNTARY LEAVING OR REFUSAL ISSUE

When a claimant quits employment which he had accepted in good faith, voluntary leaving and not refusal is at issue, even though the claimant worked in the employment for less than one-half day.

Referee’s Findings of Fact: A hearing was held at which claimant, her witness and union representative, and representatives of the Industrial Commissioner appeared and testified. Claimant, a sewing machine operator, refiled for benefits effective March 15, 1954. By initial determination effective March 26, she was disqualified for refusal of employment without good cause, and ruled overpaid $98. On March 26, claimant obtained employment on a piecework basis in a shop which was under contractual relations with her union. She was being paid union piecework rates. The industry is about 90% organized. A normal day’s work in the employer’s establishment was 8:30 a.m. to 4:30 p.m. Claimant started work at 8:30 a.m. on March 26. At about 11 a.m. she decided to quit because she was dissatisfied with her earnings. She continued working until (about) noon and then quit before going to lunch. She did not complain to her union about the piecework rate before quitting, nor did she have any immediate prospect of other employment when she left the job.

Referee’s Opinion: By quitting her job before going to lunch, after having worked only one morning, claimant is deemed to have refused the employment within the meaning of the Unemployment Insurance Law. Such refusal was without good cause. The job was one for which she was reasonably fitted by reason of training and experience. The compensation was at the union scale and was not substantially less favorable to her than that prevailing for similar work in the locality. The initial determination is sustained. Claimant was overpaid.

Appealed By: Claimant

Appellate Division Decision: Claimant is a sewing machine operator. For several years she had been employed sewing linings of coats. In March 1954 she became unemployed due to lack of work and was paid unemployment insurance benefits. On March 25 the Employment Service referred her to a manufacturer of coats, and she reported for work the next morning at 8:30 o’clock.

The work was piecework. She worked until lunch time and then quit the job because her experience led her to think that she would earn about $50 a week instead of $75 a week, which she had earned with her previous employer.

The Unemployment Insurance referee and the Unemployment Insurance Appeal Board have both held as a matter of law that claimant in these circumstances "refused" employment and is disqualified for benefits within the provisions of Unemployment Insurance Law (Labor Law, Art. 18), §593, subd. 2. The claimant on appeal here contends that she did not refuse employment; but rather that she accepted the employment and then quit it without good cause under subd. 1(c) of the same section.

The difference in consequence to the claimant whether she comes within one, rather than the other, of these subdivisions of Section 593 is quite substantial. If it is held that her "separation was without good cause" under subd. 1(c) the statute directs that "no benefits shall be payable to such claimant, nor shall he be credited with serving any part of the waiting period until forty-two consecutive calendar days have elapsed after his registration for benefits subsequent to his leaving. . .".

But for a refusal to accept employment, the penalty if far more drastic. The statute (subd 2) directs that "no benefits shall be payable to any claimant who without good cause refused to accept an offer of employment for which he is reasonably fitted by training and experience. . .". The Attorney General’s brief, with some justice, describes this subdivision as effecting a disqualification "for an indefinite period for refusing an offer of employment without good cause."

The factual findings of the Referee are that on March 26 the claimant "obtained employment on a piecework basis" and that "she was being paid" the union rate. It is further found she "started work" at 8:30 a.m.; that at about 11 a.m. "she decided to quit because she was dissatisfied with her earnings;" that she "continued working until about noon and then quit."

These factual findings led him to the opinion on the law that by "quitting her job" before going to lunch claimant is "deemed to have refused the employment" within the meaning of the statute. We are bound by the facts as found by the Referee and affirmed by the Appeal Board; but we are not bound, of course, to adopt their construction of the statute as applied to those facts.

The Attorney General on behalf of the Industrial Commissioner argues for affirmance of the legal conclusion of the Board and Referee as though they had found as a fact that claimant had "refused employment." But the actual findings of fact as made, and as they are to be seen without reference to the legal conclusions of the Referee, seem to us to point in a different direction.

It is expressly found that claimant had "obtained employment;" not that she refused it. It was found that she was "being paid" for the work and that she "started" to "work" for the employer and that she "continued working" until noon. Unless it can be held that duration of employment is the crucial test of whether or not it has been accepted, these seem to us to be unequivocal findings that claimant did not refuse, but rather accepted, employment. Whether a job is kept a full day instead of a half-day or a week instead of a day or a month instead of a week is not an automatically safe test of whether acceptance of an offer of a job is refused within the statute.

The feasible and sensible test is whether, when a job is physically taken, it is accepted in god faith or whether its acceptance is merely a mask for refusal. If automatic time periods are applied they must necessarily be fixed at some arbitrary point, in less than the duration of which leaving employment would be treated as not leaving it, but refusing it.

Here the good faith of the claimant in taking the work is conceded on the record. Mr. Goodman, claims examiner appearing for the Industrial Commissioner before the Referee, raised a question as to the admissibility of proof offered by claimant’s counsel on the question of good faith. Her counsel, Mr. Friedman, made this statement, among others: "She accept the job in good faith and it was only later on, she decided to leave."

Mr. Goodman said: "May I state for the record there is no doubt that the claimant accepted the job in good faith. We hold no such contention; so therefore let Mr. Friedman proceed from thence on the basis that it was accepted in good faith." The Referee made the comment that the Commissioner had now made the matter clear and suggested to counsel for claimant that he accept this concession "as a premise."

The Commissioner hedges this in somewhat in his brief in this court. He says here that "there is no question that claimant went to the plant of the employer in good faith," which is quite a different thing. The Commissioner’s brief argues that the Referee and the Board found that "she refused employment."

We do not read their decision this way. They found, on the contrary, that she "obtained employment," but that after having worked at it a short time she left it and her leaving is "deemed" by them to have been a refusal.

In light of the concession of acceptance of employment in good faith, there is no basis in this record for the conclusion of law by the Board and Referee that the fact of acceptance, as found, must be treated in law as a refusal. The statute imposes no such consequence on a time sequence once employment has been accepted in good faith.

The determination of the Unemployment Insurance Appeal Board should be reversed and the claim remitted to the Industrial Commissioner for further consideration, with costs to appellant against the Industrial Commissioner. (May 11, 1956)

Comments

This decision overrules that line of precedents which held that a refusal disqualification, rather than the disqualification for voluntary quit applies, if a claimant leaves a new job after work or less than one-half day.

All statements and instructions in conflict with the above rule should be disregarded. They will be deleted upon the next revision of the Interpretation Service. Specifically, release A-750-1042 (Rev.), dated October 30, 1952 is now obsolete and should be so indicated.

Of course, if circumstances show that the employment was not accepted in good faith and, to use the court’s language, "it’s acceptance was merely a mask for refusal," it will still be proper to disqualify the claimant for refusal to accept offered employment.

A-750-1422

Index No. 1725-2

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

May 24, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
VOLUNTARY LEAVING OF EMPLOYMENT
Union Relations

Referee Case Number 64-47-56R

VOLNTARY LEAVING – REFUSAL TO JOIN A UNION

Leaving employment because of a requirement for immediate membership in a union is without good cause when the employer is not engaged in interstate commerce and, therefore, not subject to the Federal Fair Labor Management Act (Taft-Hartley Act) which provides that union membership may not be required within the first 30 days after hiring.

Referee’s Findings of Fact: A hearing was held at which claimant and a representative of the employer appeared and testified. The Industrial Commissioner submitted a statement in lieu of an appearance. Claimant, a carpenter, refiled a claim effective January 17, 1956. By initial determination he was disqualified for 42 days effective that date because of voluntary leaving of employment without good cause. Claimant was employed for two days by a subcontractor engaged in furnishing the carpentry work in the construction of 500 one-family homes in Long Island. The employer was in contractual relations with a labor union. During his employment claimant was told by the shop steward of the union that he would be compelled to become a member of that union. When he indicated he would not then join the union, the employer terminated his employment.

Referee’s Opinion and Decision: In Matter of Malaspina, 285 App. Div. 564 reversing Appeal Board, 42,606-54, it was held that an employee who refused to join a union within 60 days after the date of hiring, as provided in the agreement between the union and the employer, and who was discharged because of that refusal was deemed to have left his employment voluntarily without good cause. The Court stated that this was equivalent to an election by the employee not to meet a condition of the employment. Under the Fair Labor Management Act of 1947 (Taft-Hartley Act) union membership may be required on or after the 30^th day of employment if there is a union agreement to that effect. The Act also provides that it is an unfair labor practice to demand immediate membership prior to the expiration of 30 days. Accordingly, it was held that where such immediate membership was demanded, a disqualification for refusal of such employment could not be sustained. (Appeal Board, 34,937-52, 34,877-52.) The question then to be determined is whether the employment herein constitutes interstate commerce sufficient to come within the jurisdiction of the National Labor Relations Law or is controlled by the New York Labor Law which contains no prohibition against the closed shop or the immediate requirement that an employee become a member of a union as a condition of obtaining or retaining employment. In Matter of Dennely Construction Company, 111 N.L.R.B. 180, 35 L.R.R.M. 1640, jurisdiction was accepted by the National Labor Relations Board in a case involving the operations of a general contractor. Authority for including a local subcontractor within the jurisdiction of the Federal act has not been discovered. Therefore, this employer, providing only labor to the construction project, was not engaged in interstate commerce and the employment was subject to the State Labor Law and not subject to the Federal Act. Section 704 of the Labor Law provides that an employer is not precluded from making an agreement with a bona fide labor organization requiring as a condition of employment membership therein. The doctrine in the Malaspina case (supra) is, therefore, applicable and claimant is deemed to have left his employment voluntarily without good cause. The initial determination is sustained.

COMMENTS

This case involved voluntary leaving ("provoked discharge") because of unwillingness to comply with a demand for immediate union membership. A refusal of employment for the same reason would also be without good cause (A-740-1038; Index No. 1285).
If an employer is engaged in interstate commerce, he is subject to the Fair Labor Management Act (Taft-Hartley Act) under which a requirement for immediate union membership is an unfair labor practice. Under that Act, union membership may only be required as a condition of employment on or after the thirtieth day following the beginning of employment (A-750-1140). However, when that Act does not apply because the employer is engaged in intrastate operations only, there is no prohibition against requiring union membership immediately upon hiring.

A-750-1425

Index No. 840-3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

July 12, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
CLAIMS, REPORTING & CERTIFICATION
Due Diligence

Appeal Board Case Number 55,352-56

FAILURE TO REPORT TO INSURANCE OFFICE – QUESTION OF CREDIT FOR SATURDAY, SUNDAY AND HOLIDAY

A claimant may not receive credit for any period of unemployment from the day on which an unexcused failure to report occurs, including intervening Saturdays, Sundays or holidays, until he is again entitled to credit by subsequent compliance with the reporting requirements.

APPEAL BOARD DECISION

The Industrial Commissioner appeals from the decision of the referee dated April 12, 1956 insofar as it modifies the revised initial determination of the local office holding claimant ineligible to receive benefits effective March 16 through March 18, 1956 on the ground that she failed to comply with reporting requirements by making same effective only for the one day, March 16, 1956, and remands the initial determination charging claimant with an overpayment of $18 in benefits back to the local office for recomputation of the amount.

A hearing was held before the referee at which all parties were accorded a full opportunity to be heard and at which claimant appeared and testified. The Industrial Commissioner submitted a written statement in lieu of an appearance at such hearing. The Board considered a brief submitted by the Industrial Commissioner on this appeal.

Based on the record and testimony in this case, the Board makes the following

FINDINGS OF FACT: We have reviewed the evidence adduced at the hearing before the referee and we find that such evidence supports the following findings of fact made by the referee:

Claimant, a bookkeeper II, filed for benefits effective February 27, 1956. By revised initial determination effective March 16 through March 18, she was ruled ineligible for failure to comply with reporting requirements. She was charged with an overpayment of $18.

Claimant’s insurance booklet was marked to indicate that she was to report at the insurance office on Fridays between 11:15 a.m. and 11:45 a.m. She did not report on Friday, March 16 because she visited the New York State Labor Department Building at 80 Centre Street to report a failure of a previous employer to pay her two-weeks salary. She arrived at that building at about 10:30 a.m. and left about 2 p.m. She could have reported at the insurance office either before or after she visited the State Labor Department Building. She would have reported to the insurance office on Saturday or Sunday, March 17 and March 18, but did not because the office was closed. She was available for employment on those days. She did not report to the insurance office on March 19 because of weather conditions. She telephoned the insurance office and she was excused for not reporting on that day. She next reported to the insurance office on March 20.

We make the following additional findings of fact: The referee modified the revised initial determination of the local office holding claimant ineligible to receive benefits effective March 16 through March 19, 1956 on the ground that she failed to comply with reporting requirements by making it effective for the one day March 16, 1956 and sustained such initial determination as so modified. The referee further remanded the case to the insurance office for the purpose of recomputing the amount of the overpayment in benefits charged to claimant. The Industrial Commissioner appeals from the decision of the referee insofar as adverse to him.

OPINION: The referee correctly ruled that, since claimant advanced no tenable reason for not reporting to the insurance office as required on March 16, 1956, she was properly held ineligible to receive benefits for that day because of her failure to comply with reporting requirements. Inasmuch as claimant’s failure to report at the local office on March 19 was excused by the local office due to the severity of the weather, the only issue left is whether claimant should be charged with a failure to report at the local office on March 17 and 18, 1956, at which time the local office was closed. We are not in accord with the referee’s reason for excusing claimant’s failure to report on these days.

The Industrial Commissioner’s Regulation 41.3 provides as follows:

A claimant may not receive credit for any period of unemployment from the day on which a failure to report occurred until he next reports or until the beginning of the week in which he next files an additional claim in accordance with regulation 40, whichever is earlier.

A careful reading of this provision fails to justify the interpretation, which has been placed thereon by the referee. He ruled that this section referred to those days when claimant failed to report at the local office due to her own fault or negligence. In our opinion such interpretation of the section is not permissible. It must be remembered that claimant was required to report on March 16, 1956. Had she done so, the question of whether or not she was to be penalized as to the days intervening until her next reporting would have arisen. Inasmuch as she is chargeable with a failure to report on March 16 she is likewise to be charged with the consequences which flow from her failure to report on that date. Therefore, in accordance with the provisions of the above quoted paragraph of Regulation 41, claimant may not receive credit for the intervening Saturday and Sunday, which were admittedly days of unemployment. We are of the opinion therefore, that the revised initial determination was correct and that the referee erred in modifying same by limiting it to the one day of March 16, 1956.

In passing, we note that the referee stated that Appeal Board, 22,241-50, cited by the Industrial Commissioner, was not applicable to the facts in this case because it presented a different factual situation. However, a question similar to that before us was presented to the Board in Appeal Board, UCV224-56. In that case, the claimant failed to report to the employment office on Friday, December 23 and next reported on Tuesday, December 27. There intervened a Saturday, Sunday and Christmas Day, which was celebrated on Monday, December 26. The Board reversed the referee’s modification of the initial determination of the local office in that case and held that claimant was not entitled to be credited with the intervening Saturday, Sunday and Monday pursuant to the provisions of Regulation 42.c. of the Industrial Commissioner. That regulation is similar to Regulation 41.3, except that it refers to a failure to report at the employment office instead of at the local office.

DECISION: The revised initial determination of the local office holding claimant ineligible to receive benefits effective March 16 through March 18, 1956 on the ground that she failed to comply with reporting requirements and the initial determination charging her with an overpayment in benefits in the sum of $18 by reason thereof are sustained.

The decision of the referee is modified accordingly and, as so modified, is affirmed. (June 8, 1956)

COMMENTS

Some examples will illustrate the effect of an unexcused failure to report.

If a claimant fails to report on his regular reporting date but reports thereafter in the same week, he will lose credit for all days beginning with such reporting date (holidays included) until the day he actually reports.
If he does not report again in the same week but reports on his regular reporting date in the next week, he will lose credit also for Saturday and Sunday in the week he defaulted, even though the office is normally closed on such days. This reporting in the next week constitutes an additional claim effective as of Monday of that week.
If claimant reports in the following week on a day later than his assigned reporting date, he will not receive credit as of Monday in that week; his credits will commence only with the day he actually reports.
If a claimant also fails to report in the week following the default but reports on his regular reporting date in a later week, the additional claim will be effective as of Monday of the week in which he reports.
Concerning failure to report for placement purposes, it is suggested that A-750-1392 and the accompanying comments be reviewed.

A-750-1428

Index No. 1320C-10

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

August 6, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
STRIKE OR OTHER INDUSTRIAL
CONTROVERSY
Unemployment Due To

Court of Appeals Decision

Matter of Keane, et al, 6 NY 2d 910

INDUSTRIAL CONTROVERSY, QUESTION OF; LAYOFF DURING COLLECTIVE BARGAINING NEGOTIATIONS

The suspension from benefits for loss of employment because of a strike, lockout or other industrial controversy does not apply to a claimant who is laid off in anticipation of a possible strike when the layoff occurs while (1) collective bargaining negotiations are conducted peacefully and in good faith and no impasse has been reached, (2) a strike has not as yet been authorized and (3) available work was continued without significant interruptions and without any act or incident typical of a strike or lockout.

Referee’s Decision: The revised initial determinations of the various local offices suspending the accumulation of benefit rights by the respective claimants during a period of seven consecutive weeks on the ground that they lost their employment because of a strike, lockout or other industrial controversy in the establishment in which they were employed are overruled.

Appealed By: Employer

Findings of Fact: We have reviewed the evidence adduced at the hearing before the referee and we find that such evidence supports the following findings of fact made by the referee:

* * *

The employer operates a number of ship repair yards in the country, three in New York City, one at Hoboken, New Jersey, and others at coastal points elsewhere. The collective agreement between the employer and the union was due to expire June 23, 1954 in accordance with a 60-day notice served by the union on April 23. On June 23 the union addressed the following letter to the employer:

"You have advised us that your customers may be reluctant to let your Companies, and your Companies may be reluctant to accept contracts for repair and other work at your yards, if our members shall be free to strike on June 24, 1954. You have assured us that your Companies will continue in good faith the serious bargaining for new agreements with our Union, and that you will devote as much time thereto as reasonably possible to assure substantial and rapid progress in such bargaining and the working out of new agreements at the earliest possible date.

"Consequently, in order to enable your Companies to obtain work and thus keep our members employed, while at the same time affording our respective negotiating committees an opportunity to continue zealous efforts to arrive at new agreements, our Union has, in reliance upon your aforesaid assurances, decided that it will not call on our members, to strike at your yards prior to July 23, 1954, nor without giving you 15 calendar days’ written notice of our intention to do so, provided that your Companies will, in return, during this period continue to afford our Union and the employees all the benefits, conditions, procedures and practices presently provided for and obtaining under the Agreements and otherwise.

"Our Union will not consider isolated complaints of individual employees, such as usually occur in the normal day-to-day operation of the yards, as being such a withholding or abrogation of any of the benefits, conditions, procedures, and practices above mentioned, as to warrant our calling on our members to strike before July 23, 1954, or without our giving you such 15 days’ notice, on the understanding that such complaints or grievances will, if not satisfactorily adjusted under the normal grievance procedure, be submitted to arbitration as provided in the Agreements despite the termination of such Agreements."

A further notice was sent by the union to the employer on July 7:

"This is to give you notice, in accordance with our letter to you of June 23, 1954, of our intention to call on those of our members who are employed by you to strike on July 23, 1954, unless, before that date, agreement upon new collective bargaining contracts has been reached by your Companies and our Union.

"We hope your representatives will bend every effort to meet with our Bethlehem Atlantic Coast Committee at the earliest possible date, so that negotiations may be resumed and expeditiously prosecuted for the purpose of arriving at an amicable resolution of the issues between us long before July 23^rd."

The ship repair business is one characterized by extreme instability in shipyard activity and employment levels. Save for the Korean War period, these have manifested a drastic and steady decline since World War II from an average of over 185,000 employees in the employer’s yards to 2,000 or less.

In view of the expected termination of the labor agreement, especially following receipt of the notice of July 7 the employer proceeded to curtail its operations. It did so by tapering down, by refraining from soliciting or accepting ship repair work other than short-term jobs, and by advising some of its customers that it might not be able to guarantee timely completion of jobs. * * *In the meantime, the employer and the union engaged in collective bargaining to reach a new agreement. The negotiations commenced June 3 and terminated Saturday, September 18 after about 25 sessions, when a new agreement was drafted and initialed by the negotiating teams. Beginning with that date, it resumed and intensified its efforts to secure all types of ship repair work.

As of that date, the employer believed that the difference between it and the union were resolved and that the danger of a strike was over, although the locals had not yet ratified the agreement and the employer was aware that ratification was a condition precedent to a binding agreement. Ratification, in fact, was not completed until the following week and formal execution and delivery of the document were not effected until October 5.

Up to September 18 the employer sought to obtain all "short-time" jobs it could get, and concededly there was neither strike nor lockout in the employer’s establishment. Except for the written notices, and in a . . . conversation during one of the bargaining sessions, claimants’ union representatives did not threaten a strike or intimate that one would occur, and no preparations for a strike were undertaken.

On July 19 before the close of the afternoon shift at two of the employer’s yards, the greater proportion of the employer’s workers left their stations to vote on whether the union negotiating team would be authorized to call a strike, and a similar incident occurred at the third yard on the following day. Although the votes were in the affirmative, the union team was not vested thereby with power to call a strike, and the employer was aware that under the union constitution, a strike could be called only with the approval of the National President of the union. This approval was not given and the record did not establish that it was requested.

The revised initial determinations were issued following a communication of August 4 from the employer to the Division of Employment, stating in part that:

"On July 7, 1954, the aforementioned Union served upon this Company notice of its intention to strike on or after July 23, 1954. As a result of this notice, a definite decline in operations has set in, occasioned by the wide publicity given such notice in the metropolitan papers and by the national press services and by our normal business procedure of keeping our customers advised of developments which could have an unfavorable effect upon their operations and property.

"Because of such decline in business involving cancellations of incoming work and curtailment or cancellation of work already in the various Yards a number of our employees have been or will be laid off. Others, whom we would normally be recalling to work after previous layoffs, will not be so recalled as a result of the decline in business.

"We are calling these facts to your attention so that you may take the proper steps necessary for notification to your local offices regarding processing of any employees who are or hereafter may be idled as a result of the effect of the strike notice."

* * *

We make the following additional finds of fact: The claimants filed for benefits on various dates from July 26 to August 10, 1954, inclusive. The various local offices issued initial determinations, in each of the respective individual cases, suspending the accumulation of benefit rights by each of the claimants during a period of seven consecutive weeks, effective on various dates from July 22, 1954 to August 10, 1954, inclusive, on the ground that each of the claimants lost his employment because of a strike, lockout or other industrial controversy in the establishment in which he was employed. Each of the claimants requested a hearing and the referee overruled the initial determination in each case. The employer thereupon appealed to this Board and posted the $25 statutory deposit in one of the cases in dispute on this appeal.

A preliminary issue has been interposed on these appeals on behalf of the claimants herein, raising objection to a determination of the appeals in those cases where the employer has not posted individual $25 statutory deposits. Since a common issue is involved in all of these cases, the Board hereby determines that an appeal was properly taken as to all cases by the posting of a single $25 deposit in the series of cases involved on this appeal. (See 1951 Report of Joint Legislative Committee on Unemployment Insurance, Appendix B, pp. 32,34 and 35).

Collateral issues raised by the issuance of initial determinations with respect thereto, were not passed upon by the referee nor is the Board making any decision herein with respect thereto. In each of those instances, the issues are deemed to be still pending, without prejudice to the rights of any of the parties to a hearing upon the merits thereof.

Appeal Board Decision: The respective initial determinations of the various local offices, suspending the accumulation of benefit rights by each of the claimants herein during a period of seven consecutive weeks effective on various dates from July 22, 1954 to August 10, 1954, inclusive, on the ground that each of said claimants lost his employment because of a strike, lockout or other industrial controversy in the establishment in which he was employed, are overruled.

Claimants were not overpaid in benefits as the result of any initial determination overruled by this decision.

The decision of the referee is affirmed.

A separate order is to be entered in each case.

Appealed By: Employer

Appellate Division Decision: Claimant’s employment in the employer’s ship repair yards was under the terms of a union contract expiring June 23, 1954. The union gave sixty day’s prior notice of intent to terminate the contract and to renegotiate as of that expiration date. Negotiations at two meetings held prior to that time were unsuccessful. On June 23 the union advised the employer, in writing, that no strike would be called prior to July 23 or, in any event, without fifteen days’ prior notice. On July 7 the union served notice of its intention to call on its members to strike on July 23 and by votes taken at subsequent meetings of local unions the union negotiating committee was authorized to call a strike. Such action was, however, subject to final authorization by the president or executive board of the international union, which was not given or, so far as appears, applied for. On July 23, the union issued to its members leaflets stating that work, as well as negotiations, would continue on a day-to-day basis, the employer and employees continuing to observe the terms of the expired contract and no strike to occur until the general executive board should be convinced that there would be no usefulness in continuing negotiations. On September 18 the negotiating teams reached an agreement which was subsequently ratified. Work and negotiations alike did proceed during all the period in question, peacefully and without incident except that on two occasions certain shifts left work early, on the first occasion to vote on the proposal to authorize a strike and, later, to vote on the proposed new contract.

During the period, the employer laid off workers in substantial numbers and has offered proof claimed to substantiate its contention that such layoffs were necessitated by a shortage of work which was, in turn, due to its, as well as its prospective customers’, apprehension as to delays in performance which would ensue upon a strike. As early as June 9 the employer began to advise prospective customers as to what it termed the strike threat and to solicit work which could be completed quickly or without penalty by way of demurrage, if delayed.

The claims of the employees-respondents are contested by the employer on the ground that their unemployment was caused by an industrial controversy within the meaning of subdivision 1 of Section 592 of the Labor Law which suspends benefit rights for seven weeks from the day after loss of employment "because of a strike, lockout or other industrial controversy". The Unemployment Insurance Appeal Board has found that neither occurred. In our view, there was substantial evidence supporting that determination. That being so, we need not pass on the board’s finding against the employer on the issue of casual relationship.

As against the proof of the union’s notice of intention to seek a strike vote and the locals’ subsequent authorization conferred upon the negotiating committee, but neither acted upon by the committee nor ratified by the international union the board was entitled to weigh the evidence that the available work continued without any significant interruption or other incident and that the contract negotiations proceeded peacefully and to a successful conclusion. Upon thus weighing the proof, the board was entitled to find, as it did, that no strike, lockout or other industrial controversy existed. In affirming that basic finding, we do not adopt the unnecessary expressions of opinion which followed it in the referee’s decision, which the board adopted, characterizing the collective bargaining negotiations as "the antithesis of a strike, lockout or other controversy", nor do we approve the further and again unnecessary conclusion that the initial denial of benefits to workers laid off by reason of the employer’s anticipation of a strike was unjustified because no strike eventuated. We are satisfied from our reading of the board’s decision that its findings were based upon the entire record and are amply sustained by it.

In our view, the board properly applied the principle expressed in Matter of Cohen (Corsi), 283 App. Div. 143. There the employer properly elected to negotiate a new working arrangement, as the employees did here. There, as here, employees were laid off while negotiations proceeded peacefully until a new contract was concluded. "This", we said, "is not what the Legislature meant by ‘strike, lockout or other industrial controversy’ which, read together, must open to the construction that the ‘other industrial controversy’ intended was something in the nature of a strike or lockout. The purpose of the statue as Presiding Justice Foster observed in Matter of Burger (Corsi) (277 App. Div. 234, 236) (affd, 303 N.Y. 654) is that the State is to step aside for a time, pending the settlement of the differences between employer and employee ‘to avoid the imputation that a strike may be financed through unemployment insurance benefits.’" In this case reasons at least equally strong forbade the application of pressure by denial of benefits while bargaining was carried on peacefully and in good faith and without act or incident found, upon the factual situation as a whole, to have been in the nature of a strike or lockout.

Our holding in Matter of Vingoe (Bethlehem Steel Co.), 285 App. Div. 160, is in no way inconsistent with that in the Cohen case, supra, or with the board’s determination here. There, negotiations had failed, a strike was called and temporarily deferred only by reason of an executive order issued by the President of the United States and employees had commenced the "orderly shutdown" vital to the preservation of equipment and constituting a definite phase of the strike process. The appeal to this court was from a board determination adverse to the claimants and we found that substantial evidence supported it.

The appellant employer relies in large measure on Unemployment Compensation Commission v. Aragan, 329 U.S. 143, and on Mortenson v. Board of Review, _____ NJ _____, (121 A. 2d 539). Both involved statutes, comparable to that of New York, governing unemployment benefits, the words "labor dispute" rather than "industrial controversy" appearing in the foreign statutes, a difference which we deem immaterial to a proper analysis of the cases. In each, unlike the present case, the appellate court was presented with a determination by the fact-finding administrative agency adverse to the employees-claimants. In discussing the administrative body’s application on the term "labor dispute" in the Aragan case, supra, the court said, "All that is needed to support the Commission’s interpretation is that it has ‘warrant in the record’ and a ‘reasonable basis in law’". In the Mortenson case, supra, the court said, "The Appellate Division concluded that ‘substantial evidence was presented at the hearings from which both of the findings were justified and we discern no reason for a full de novo excursion into the field'.’ 37 NJ Super. at 241. Our own examination of the record satisfies us that this conclusion was right."

Regardless of the distinctions noted, however, we find the Aragan case, on its facts, inapplicable here and the holding in the Mortenson case does not persuade us to a like determination of this. In the Aragan case, decided prior to our decision of the Cohen case, supra, and involving seasonal employment, the employers terminated their labor contracts prior to the opening of the season and invited negotiations, during which "serious disagreement appeared which quickly developed into an impasse on the question of wages". The employers fixed deadlines, which were not met, with the result that no work was performed. That factual situation presents, to our minds, little analogy to that which existed in this case.

The Mortenson case, supra, involved the impact upon this employer’s New Jersey yard of the contract termination and negotiations here involved. As appears from the Appellate Division opinion (37 NJ Super. 236) "unrest" existed and "some sporadic, improper incidents" occurred which had no counterparts in the New York yards, but passing these differences and those others which have been noted, we are unable in any event to give weight to the opinion of the New Jersey Supreme Court, relying as it in large measure does, upon the Aragan decision which we have held inapplicable here.

Adhering, as we do, to the principle and the incidental definition stated in the Cohen case, supra, we refrain from an extended discussion of appellant’s contention that the term "other industrial controversy" is synonymous with "labor dispute", as used in other state and federal enactments, with the effect, in appellant’s view, of broadening the application of the former. In particular, appellant would apply to "other industrial controversy" the definition specifically applied by subdivision 10(c) of section 876-a of the Civil Practice Act to the term "labor dispute" appearing elsewhere in that section, relating to injunctions issued in labor disputes. It seems clear that the definition prescribed by a statute for words used in that particular statute does not necessarily govern the construction of those same words, to say nothing of words merely similar, as they may appear in other acts, and, in fact, the reasons necessitating such a definition in a particular instances may some times militate against the general application of that definition. Nevertheless we do not consider the resolution of this semantic controversy necessary to a proper analysis of the authorities above reviewed or to our determination of the issues. Dealing with a similar contention raised in the Aragan case, supra, the court said, "we need not determine whether ‘labor dispute’ must in all cases be construed as broadly as it is defined in the Norris-LaGuardia Act and the National Labor Relations Act".

Our affirmance renders academic the procedural question raised by respondents with respect to the initial determination.

The decision should be affirmed, with costs to respondents-claimants against the appellant. (July 9, 1956)

COMMENTS

Two points are made in this Court decision which deserve mention

The Court does not adopt the reasoning that collective bargaining negotiations are "The antithesis of a strike, lockout or other controversy".

This means that an industrial controversy within the meaning of the Unemployment Insurance Law may exist although collective bargaining negotiations are still in progress.

The Court does not approve the conclusion that the suspension, which had been imposed, was unjustified "because no strike eventuated". This means that any industrial controversy justifying a suspension may exist even though no strike takes place eventually.

On the positive side, the decision can be taken to stand for the principle that a layoff, consequent upon a curtailment of operations due to the possibility of a strike, does not warrant the imposition of a suspension in the absence of any other factors which show or tend towards a break-off of normal and peaceful employer-employee relations. The mere fact that a "demand" for wage increases etc. has been made does not reflect the existence of an industrial controversy within the meaning of the law. Acts must be present which are designed to enforce or thwart such demand, outside the field of peaceful and continuing negotiations.

A-750-1432

Index No. 865A-3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

August 30, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
CLAIMS, REGISTRATION AND CERTIFICATION
Delay in Registering

Appeal Board Case Numbers 55,902-56 through 55,903-56

DENIAL OF REQUEST FOR PREDATING A CLAIM

Predating a claim cannot be based on claimant’s allegation that he was misinformed by the local office when giving such information would have been contrary to local office procedures and when there is no evidence of probative value to overcome the presumption of regularity as to compliance with local office procedures.

Referee’s Findings of Fact: A combined hearing was held at which claimant and representatives of the Industrial Commissioner appeared and testified. Claimant, a shipping supervisor, filed for benefits on March 14 effective March 12, 1956. An initial determination was issued which ruled claimant ineligible for benefits because he had no covered employment in the base year, March 14, 1955 to March 11, 1956, which was established on the above filing. Claimant requested that his claim be predated to January 2, 1955. This request was denied and an initial determination was issued ruling claimant ineligible for failure to comply with registration requirements from January 29, 1955 to March 11, 1956. Claimant was employed by a department store organization for 31 years until January 1955. He was a supervisor in his employer’s warehouse. For some time prior to the end of January negotiations took place between claimant and his employer concerning the termination of claimant’s job. Claimant believed his last day of work was January 28, 1955. He received his semi-monthly pay at the end of January. This included one month vacation pay. It was known to claimant at the time of his separation that his employer intended to pay him one year’s pay. This payment was made in a lump sum. Claimant had no experience with the unemployment insurance program. During the first half of February 1955, he telephoned the Jamaica office of the Division of Employment in order to obtain information concerning the filing of a claim for benefits. He had not received any forms or instructions concerning this from his employer at the time of his separation from his job. During the course of the telephone call to the insurance office, claimant was required to repeat his inquiry to three successive staff members. He explained that he had been laid off and that he had received or was to receive one year’s salary and asked what to do about applying for unemployment insurance. He was told to make his claim after the year would expire. He specifically asked if it was necessary for him to report to the insurance office at that time and offered to do so, but was told that this was not necessary. There was no reason why claimant could not have promptly reported to the insurance office. He did not do so only because of his reliance upon the instructions, which were given to him. Claimant is 62 years of age. He had no intention of abandoning employment. He had independently instituted steps to secure work even prior to making the telephone inquiry of the insurance office in the first half of February. He thereafter continued his job-seeking efforts by applying to employment agencies and by applying to prospective employers and by negotiating with employers not only in New York City, but elsewhere. He continued to be ready, willing, and able to accept work throughout 1955. Claimant intended to report to the insurance office to file a claim in early February 1956, when the year to which the payment applied would expire. He was ill for a number of weeks during February and for this reason did not report to the insurance office until March 14. The $5000 paid to claimant by the employer was a voluntary dismissal wage. Claimant was not subject to call by the employer after the end of January 1955, and was not required to, nor did he, render any services of any nature whatsoever for the employer subsequent to the end of January 1955.

Referee’s Opinion and Decision: Claimant performed no services during the base period Mach 14, 1955 to March 11, 1956. The payment, which he received from his employer after the termination of his employment, was a dismissal payment and was excluded from the definition of remuneration. (Section 517.2(I).) Claimant, therefore, failed to meet the requirements of a valid original claim with respect to the filing which was made effective March 12, 1956. Although it was testified that it is contrary to the established procedures and policy which govern the operation of the insurance offices for information to be given by telephone, the credible evidence convinces me that claimant failed to report to the insurance office and to personally register his claim for benefits during the first half of February 1955, solely because of his reliance upon instructions which were given to him that it was not necessary for him to report to the insurance office until a year elapsed. Claimant was able to report to the insurance office and would have done so if any indication had been given to him that this was required, necessary or desirable. The quality of claimant’s testimony was such that it far outweighs the evidence offered on behalf of the Industrial Commissioner, which consisted of a general reference to the established policies of the insurance office. Since claimant had a valid reason for not reporting to the insurance office during 1955, following the termination of his employment, the initial determination denying his request for a predating of his claim is overruled. This matter is referred to the insurance office for the ascertaining of a benefit rate for claimant based upon such a filing. The initial determination of ineligibility based upon the filing effective March 12, 1956 is sustained. The initial determination denying claimant’s request for a predating of his claim is overruled.

Appealed By: Industrial Commissioner

Appeal Board Decision: After a careful review of the record, testimony and evidence adduced before the referee, and due deliberation having been had thereon, and having found that the referee’s findings of fact and conclusions of law are fully supported by the evidence in this case, and that no errors of fact or law appear to have been made, the Board adopts the findings of fact and the conclusions of law made by the referee as the findings of fact and conclusions of law of this Board, except that we find that the record does not support claimant’s contention that he telephoned the insurance office in February of 1955 and was advised by a representative of the Industrial Commissioner, in answer to an inquiry, that he was ineligible to receive benefits until after a year would expire (period represented by the one year’s salary which he received from his employer in a lump sum) and that it was unnecessary for him to report at the local office. We do not adopt the referee’s findings to that effect. The Board is of the opinion that the referee made proper findings of fact and correctly determined the issue involved in this case; except as above stated. Claimant offered no valid reasons for predating his claim. He bases his contention on an alleged telephone conversation with an unidentified person in the insurance office. Such information, had it been given, would have been contrary to the regulations of the Industrial Commissioner. Accordingly, we find that there is no evidence of probative value in this case to substantiate claimant’s contention that he was misinformed by a representative of the local office and thus to overcome the presumption of regularity as to compliance with proper office procedure. Claimant’s request to predate his claim was properly denied. The initial determinations of the local office (1) denying the request of claimant to predate his claim from March 12, 1956 to January 29, 1955 and holding that he was ineligible to receive benefits effective January 29, 1955 through March 11, 1956 on the ground that he failed to comply with registration requirements and (2) holding claimant ineligible to receive benefits effective March 12, 1956 on the ground that he did not file a valid original claim in that he did not have at least 20 weeks of covered employment in his base period, are sustained. The decision of the referee is modified accordingly, and, as so modified, is affirmed.

A-750-1433

Index No. 1540-3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

August 30, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
CLAIMS, REGISTRATION AND CERTIFICATION
Concealment of refusal of employment

Appeal Board Case Number 55,70-56

FALSELY CERTIFYING THAT NO EMPLOYMENT WAS REFUSED

Falsely certifying that no employment was refused constitutes a wilful misrepresentation to obtain benefits even though the refusal was with good cause.

Referee’s Decision: The initial determinations of the local office (1) disqualifying claimant, a carpenter-apprentice, from receiving benefits effective December 27, 1955 on the ground that without good cause he refused employment for which he is reasonably fitted by training and experience, (2) holding that claimant wilfully made a false statement for the purpose of obtaining benefits for which a forfeiture of 24 effective days against his future benefit rights was imposed as a penalty and (3) charging claimant with overpayments of $396 in benefits is overruled.

Appealed By: Industrial Commissioner

Findings of Fact: Claimant, a carpenter-apprentice, was employed by a construction company for approximately seven months to October 1955. He had been hired under a program of the State Apprenticeship Council pursuant to which he would qualify as a journeyman-carpenter after four years. He was paid $1.75 an hour with the construction company. He was laid off because of a lack of work. Claimant is a war Veteran, 24 years old, who was discharged from the military service because of a disability involving his arm. He is unable to do heavy labor work. His disability is rated at 50 percent by the Veterans’ Administration. Claimant filed an original claim for benefits effective October 31, 1955 and registered for employment. Claimant’s employer indicated on a notice of experience rating charges mailed to it on February 16, 1956, relating to the payment of benefits to claimant for the week ending January 29,1956, that claimant "refused to come back to work". Based upon a report by telephone from the employer that claimant’s refusal to return to work occurred either in November or December 1955 the local office issued initial determinations disqualifying claimant from receiving benefits effective December 27, 1955 on the ground that without good cause he refused employment for which he is reasonably fitted by training and experience, and charging him as a result thereof with overpayments of benefits totaling $396. Based on a statement by claimant on January 27, 1956 to the effect that he had not refused any jobs during the period for which he was claiming benefits the local office issued an initial determination holding that claimant wilfully made a false statement for the purpose of obtaining benefits, for which a forfeiture of 24 effective days against his future benefit rights was imposed as a penalty. Claimant protested the initial determinations and requested a hearing. The referee overruled all of the foregoing initial determinations and the Industrial Commissioner appealed to the Board. The employer's offer to re-employ claimant was made at sometime prior to January 27, 1956. He was informed that he would have to do laboring work if necessary and that it would be heavier work than that usually performed by carpenter-apprentices. Claimant refused to accept the offer of re-employment because he had found that labor work, which he had occasionally performed during slow periods when there was no carpentry work available, affected his arm, in which he has a plate to replace a missing bone. On January 27, 1956 claimant stated that he had no refused employment because he thought that only the offer of work identical to that previously performed required an affirmative answer to the question on the Unemployment Insurance office form.

Appeal Board Opinion and Decision: The referee ruled that claimant refused employment with good cause since he was offered heavy labor work which he is unable to do. The Board agrees with this portion of the referee’s decision. The referee resolved the ambiguity in the record as to the date on which the refusal of employment occurred by fixing the same as January 30, 1956 and consequently overruled the initial determination holding that claimant wilfully made a false statement for the purpose of obtaining benefits when he stated on January 27, 1956 that he had not refused employment. The date on which the refusal occurred would be immaterial were the only issue in the case refusal of employment, since the record supports the conclusion that the refusal was with good cause. The date on which the refusal occurred is however of importance in connection with the issue of wilful misrepresentation, since if the date be prior to January 27, 1956, rather than as found by the referee, the initial determination of wilful misrepresentation was properly issued by the local office. A careful analysis of all of the evidence in the record convinces us that the date on which claimant refused the offer of re-employment cannot be fixed with certainty. The employer’s testimony on this subject is contradictory. He stated that he was not sure of the date, that it occurred about Christmas time, and that "it could be the second or third week in January". Claimant’s testimony on this subject is equally unsatisfactory. He stated that he was not sure of the dates and that he thought the employer "called me up at the end of February." It is obvious that the selection by the referee of January 30, 1956 as the date of refusal was arbitrary, as was the date of December 27, 1955, which was selected by the local office. Although the date of refusal cannot be fixed with certainty, the record is clear that it occurred at some time prior to January 27, 1956 when claimant certified at the local office that he had not refused employment. An analysis of his testimony indicates that he answered the question in the negative because it was his belief that an affirmative answer was called for only in the event he had been offered employment involving the same duties as previously performed by him. This indicates that the refusal of employment had already taken place at the time claimant furnished contrary information. Claimant was obligated to supply truthful information and was not at liberty to speculate as to the ultimate legal effect of the underlying facts (See Matter of Bernstein, 303 N.Y. 755, affirming 278 App. Div. 625, reversing Appeal Board, 22,265-50). Claimant knew that he was stating something to be a fact, which was not the fact, and he did so for the purpose of obtaining benefits. The initial determination imposing a forfeiture of 24 effective days was correctly issued by the local office. The initial determination of the local office disqualifying claimant from receiving benefits effective December 27, 1955 on the ground that without good cause he refused employment for which he is reasonably fitted by training and experience and that part of the initial determination charging him with overpayments of $396 in benefits are overruled. That part of the initial determination of the local office holding that claimant wilfully made a false statement for the purpose of obtaining benefits and imposing a forfeiture of 24 effective days against his future benefit rights as a penalty therefore is sustained. The decision of the referee is modified to accord with the foregoing and, as so modified, is affirmed. (July 20, 1956)

A-750-1435

Index No. 1040-3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

August 30, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
HEARINGS AND APPEALS
Limitation on Jurisdiction

Appeal Board Case Number 48,935-55

HEARING AND APPEALS – JURISDICTION OVER AMENDED DETERMINATIONS

A referee has jurisdiction to rule upon an amended determination even though introduced for the first time at the hearing, if such amended determination is based on the same facts, which gave rise to the issuance of the original determination.

Referee’s Decision: The amended initial determination of the local office, added at the hearing before the referee, holding claimant ineligible to receive benefits effective August 24 through September 5, 1954 on the ground that he was unavailable for employment is overruled.

Appealed By: Industrial Commissioner

Findings of Fact: Claimant, a ship repair worker, filed an original claim for benefits on August 17, 1954 effective August 16, 1954. On August 21, 1954 he went to Connecticut to visit his sister who was seriously ill. She died on August 28, 1954 and funeral services were held on August 31, 1954. Claimant next reported at the local office on September 8, 1954. He was unable to work during this period because he was engaged in making arrangements connected with his sister’s funeral and because he was emotionally disturbed.

Based on information that claimant had been laid off by his employer in anticipation of a strike the local office issued an initial determination suspending claimant’s accumulation of benefit rights for a period of seven consecutive weeks effective August 13, 1954 on the ground that he lost his employment because of an industrial controversy in the establishment in which he was employed. A further initial determination was issued holding claimant ineligible to receive benefits effective for the period August 24 through September 5, 1954 on the ground that he failed to comply with reporting requirements. Claimant protested the initial determinations and requested a hearing. At the hearing the initial determination relating to failure to comply with reporting requirements was, over the objection of claimant’s attorney, amended so as to hold in addition thereto, that claimant was ineligible to receive benefits effective for the period August 24 through September 5, 1954 on the ground that he was unavailable for employment. The referee overruled all of the foregoing initial determinations and the Industrial Commissioner appealed to the Board from the referee’s decision insofar as the same overruled that part of the amended initial determination of the local office, added at the hearing, which related to claimant’s availability for employment during the period August 24 through September 5, 1954.

Appeal Board Opinion: The referee overruled the initial determination relating to claimant’s availability for employment apparently because he was of the opinion that claimant’s failure to report to the local office was excusable since it was occasioned by personal circumstances of a compelling nature. We do not agree with the referee's disposition of this case, insofar as this appeal is taken therefrom. It affirmatively appears that claimant was unable to work during the period in issue. It is therefore our conclusion that the very circumstances which justified excusing his failure to report at the local office (the necessity of being with his sister and making arrangements in connection with her funeral) rendered him unavailable for employment within the meaning of the Law (See Section 591.2 Unemployment Insurance Law).

It was argued at the hearing before the referee that the referee was without jurisdiction to rule upon the issue of availability which was tendered for the first time at the hearing and that the authority to issue initial determinations rested exclusively with the local office. These objections are without merit. It was not argued, nor indeed could it be that claimant was prejudiced in meeting the additional issue, since it was based on the same facts which gave rise to the issuance of the initial determination concerning his failure to report at the local office. The Industrial Commissioner is of necessity constrained to act through agents and employees. It has long been customary for such agents and employees, at hearings before referees, to supplement or amend initial determinations already issued by the local office, in proper cases. We perceive no valid reason for interfering with such customary usage, deemed necessary by the Industrial Commissioner to efficient administration of the Law. No new facts were adduced before the referee that were not already known to claimant. The amendment offered by the Industrial Commissioner’s hearing representative was merely an additional determination based on the same facts. The referee was therefore empowered to rule upon the issue of availability, which was introduced at the hearing. His ruling thereon was erroneous for the reasons herein above set forth.

Appeal Board Decision: The initial determination of the local office suspending the accumulation of benefit rights by claimant for a period of seven consecutive weeks effective August 13, 1954 on the ground that he lost his employment because of an industrial controversy in the establishment in which he was employed is overruled. That part of the initial determination of the local office, as amended, holding claimant ineligible to receive benefits effective August 24 through September 5, 1954 on the ground that he failed to comply with reporting requirements is overruled. That portion of said initial determination holding claimant ineligible to receive benefits effective August 24 through September 5, 1954 on the ground that he was unavailable for employment is sustained.

The decision of the referee is modified to accord with the foregoing and as so modified is affirmed. (July 20, 1956)

COMMENTS

It appears that a referee has similar powers on his own initiative in unrepresented cases in order to reach proper conclusions since he is "not *** bound by *** technical or formal rules of procedure but may conduct the hearings *** in such manner as to ascertain the substantial rights of the parties." (Section 622 subd. 2 of the Unemployment Insurance Law).

Based upon the same facts, the referee may apply a provision of the law or determination different from that applied by the local office. Similarly, he may rule that a refusal of employment is with good cause but the same facts indicate unavailability. An example of that is where a claimant cannot accept a job because she has no one to care for her children.

A-750-1436

Index No. 1505C-1
1520.2

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

August 30, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
MISREPRESENTATION OR MISSTATEMENT
Concealment of Earnings
Evidence of

Appeal Board Case Number 55,936-56

FORFEIT PENALTY, QUESTION OF – PREVIOUS NOTIFICATION TO EMPLOYMENT SERVICE

A false certification to total unemployment and false entries in the insurance booklet constitute a wilful misrepresentation to secure benefits even though claimant had disclosed the employment to the Employment Service and relied on the assistance of another person who marked the insurance booklet.

Referee’s Findings of Fact: A hearing was held at which claimant, her witness, and representatives of the Industrial Commissioner appeared and testified. Claimant, a merrow-machine operator, filed for benefits effective December 5, 1955. By initial determination, she was ruled ineligible on March 22 and March 23 because she was not totally unemployed. By initial determination effective March 26, she was disqualified for refusal of employment without good cause. She was ruled overpaid $46.50 in benefits. Her benefits were ruled to be forfeited for 24 effective days because of wilful misrepresentation to obtain benefits. On March 20 the employment office referred claimant to a job for which she was to apply on the following day, and she was instructed to report back to the employment office on March 22. She applied for the job on March 21 as instructed, and was told to report for work the following day. Claimant did not report to the employment office on March 22 because she worked on that day and on the following day. During the afternoon of March 23 she reported to the employment office and stated that she had worked three days and left the job because she was dissatisfied with her earnings. The employment office referred claimant to another job with instructions to report to the employer on the following Monday, March 26. This employer informed the employment office that claimant failed to report. However, claimant testified, and I find, that she did apply for the job and returned each day until April 2 at the employer’s request to see whether there would be work for her. On April 2 the employment office referred her to another job. When claimant reported to the insurance office on April 2 there were entries in her insurance booklet showing that she was unemployed on each day during the statutory week ending March 25. These entries were made by one of claimant’s daughters. Claimant has a limited knowledge of the English language. She testified, and I find, that she told her daughter that she work on March 22 and March 23. On December 13, 1955, claimant had been interviewed at the insurance office in connection with reporting several days of employment a few weeks earlier. At that time it was explained to her that her insurance booklet must be marked to show on which days she worked. This interview was conducted with the aid of an interpreter whom claimant had brought to the insurance office with her.

Referee’s Opinion and Decision: Claimant was ineligible for benefits on March 22 and March 23 since she worked on those two days. As a result, she was overpaid in benefits. The credible evidence establishes that claimant did not refuse employment on March 26. She applied for the job and continued to report to the employer until the employment office gave her another referral. It was contended on behalf of the Industrial Commissioner that claimant’s benefits were subject to forfeiture under Section 594 of the Unemployment Insurance Law because she failed to report that she worked on March 22 and March 23. However, the fact that claimant furnished incorrect information to the insurance office is not, in and of itself, sufficient to establish the wilful misrepresentation. It must further be shown that she knew the information she furnished was incorrect. (Matter of Bunzl, 1 App. Div. 2d 46, modifying Appeal Board 50,401-55). The credible evidence establishes that claimant was unaware of the fact that her daughter had made incorrect entries in the insurance book. This conclusion is supported by the fact that claimant reported this employment to the employment office. Appeal Board 53,475-55 is therefore inapplicable. In that case, it was held that previous notification to the employment office did not excuse a false certification at the insurance office. However, in the instant case claimant did not knowingly make a false certification. The instant case is also distinguishable from those cases in which the appeal Board held claimant chargeable with the entries made in his insurance booklet by another person. (Appeal Board 51,489-55 and 52,998-55.) In those cases there was no indication that the claimant had made any effort to furnish correct information. In the present case claimant did not conceal her employment, but discussed it at the employment office. Her insurance booklet showed that there had been a job referral and that claimant had reported late to the employment office. This case involves an inadvertent error resulting solely from claimant’s language handicap. The initial determination of total unemployment is sustained. The other initial determinations are overruled. The overpayment should be recomputed by the insurance office.

Appealed By: Industrial Commissioner

Appeal Board Decision: After a careful review of the record, testimony and evidence adduced before the referee, and due deliberation having been had thereon, and having found that the referee’s findings of fact and conclusions of law are fully supported by the evidence in this case, and that no errors of fact or law appear to have been made, the Board adopts the findings of fact and the conclusions of law made by the referee as the findings of fact and conclusions of law of this Board, except as hereinafter indicated. The Board makes the additional findings of fact: On March 26, 1956 (inadvertently stated in the referee’s decision as April 2, 1956), claimant reported to the insurance office that she was unemployed on each day in the statutory week ending March 25 as noted in her insurance booklet. The entries in the insurance booklet for the week ending March 25 were made by one of claimant’s daughters due to the fact that claimant had limited knowledge of the English language. The improper entries were made by the daughter after she had been informed by claimant that she had worked on March 22 and 23. On the same day claimant certified for benefits for the week ending March 25. The Board is of the opinion that the referee made proper findings of fact and correctly determined the issues involved in this case, as modified and supplemented herein, except as to the initial determination relating to claimant’s wilful misrepresentation. The record shows that claimant was employed on March 22 and March 23 and that claimant was aware of this fact at the time she reported to the insurance office on March 26 and certified that she was totally unemployed for that week. Under such circumstances the Board must conclude that claimant wilfully made a false statement to obtain benefits within the meaning of the Unemployment Insurance Law. The fact that claimant disclosed to the employment service her employment on the days in question and the fact that claimant relied on the assistance of her daughter in marking the insurance booklet does not affect the falsity of the statement (See appeal Board, 53,475-55; 52,998-55 and 51,489-55). The initial determination of the local office holding that claimant wilfully made a false statement to obtain benefits for which a forfeiture of 24 effective days in reduction of claimant’s future benefit rights was imposed as a penalty is sustained. The decision of the referee insofar as appealed from is modified accordingly and, as so modified, is affirmed. (August 3, 1956)

A-750-1438

Index No. 1290B-5

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

October 15, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
REFUSAL
Wages – prevailing

Appeal Board Case Number 56,378-56

Refusal of a job offer at a salary which bears a reasonable relationship to claimant’s demonstrated earning capacity is without good cause when it is not feasible to obtain reliable prevailing wage information because of the characteristics of the occupation.

Referee’s Decision: The initial determination of the local office disqualifying claimant from receiving benefits effective May 14, 1956, on the ground that, without good cause, he refused employment for which he is reasonably fitted by training and experience is overruled.

Appealed By: Industrial Commissioner

Findings of Fact: We have reviewed the evidence adduced at the hearing before the referee and we find that such evidence supports the following findings of fact made by the referee:

Claimant, an electronic engineer, refiled effective April 23, 1956. By initial determination effective May 14 he was disqualified for refusal of employment without good cause, and in the alternative, ruled ineligible for failure to comply with reporting requirements by initial determination effective May 21 and May 22.

Claimant has had about 15 years’ experience in the field of electronics, primarily in audio. Prior to refiling for benefits, he worked for about two weeks for an electronics industry manufacturer at $135 for a 35-hour week, and was let go because of the length of time involved in securing clearance for him. Prior thereto, he worked for about three months at $120 per week, and was let go when a former employee returned. For four months to October 1955, he worked at $120 per week, and was discharged at the insistence of the union in the field, which contended that he had been assigned work that should have been assigned to a union member.

On May 14 an employment interviewer referred claimant to a firm manufacturing telephone equipment at $6,000 to $6,500 a year. Claimant was interviewed by the prospective employer and was advised that the job duties required acoustical knowledge and experience, which claimant did not have and the employer offered to hire him at $115 per week. He refused the employment because of insufficient remuneration. The hearing representative was unable to furnish prevailing wage information as the Bureau of Research and Statistics advised him that no survey was feasible because of the impossibility of measuring the varied and complex factors involved in salary payment for a professional job of this nature. From June 13 to June 15, claimant worked for a firm manufacturing electronic equipment as head of the department testing engineering procedures, at $140 per week. He was let go because the employer was not satisfied with the replies of his former employers and he was informed that he would be reinstated if he could obtain satisfactory references.

We make the following additional findings of fact: Claimant lacks an engineering degree. He objected to the initial determinations and requested a hearing. The referee overruled the initial determination disqualifying claimant for refusal of employment and sustained the alternative initial determination pertaining to claimant’s failure to comply with reporting requirements. The Industrial Commissioner appeals from that portion of the referee’s decision adverse to him. No appeal has been filed by the claimant.

Appeal Board Opinion: The referee in overruling the initial determination concluded that claimant was not reasonably fitted by training and experience for the offered employment. The referee further stated that the employer offered claimant a salary substantially less than that quoted by the employment service. Although claimant lacks a degree, in view of his varied experience extending approximately 15 years, we hold he was reasonably fitted by training and experience for the offered employment. Although he lacked the precise experience preferred by the prospective employer, his general experience in the electronics field was acceptable to the employer. The referral was made at a salary ranging from $6,000 to $6,500 per year. Because he did not have acoustical experience, claimant was offered $115 a week by the employer. This amount to $5,980 annually, and is not substantially less than the minimum figure quoted. Because of certain characteristics of the occupation in question, obtaining of reliable prevailing wage information is not feasible. Therefore, in the absence of competent evidence as to prevailing rate, the wages earned by the claimant in previous employments may be some indication of the prevailing rate for a person with his qualification at the time of the offer (Appeal Board, 12,852-46). From July 1955 to the date of the refusal of the employment in question he held two jobs in each of which he earned $120 weekly. Prior to that he earned $135 a week for a two-week period. The salary involved in the job offer in question bore a reasonable relationship to claimant’s demonstrated earning capacity. Upon all the circumstances herein, we held that claimant, without good cause, refused employment for which he is reasonably fitted by training and experience, is sustained. The decision of the referee, insofar as appealed from is reversed. (August 24, 1956).

COMMENTS

This decision furnishes a practical answer to an otherwise almost insoluble problem. It is sometimes virtually impossible to obtain the usual prevailing wage information, either because the characteristics of the offered job are so peculiar or unique that they defy a reasonable comparison with a representative number of other jobs or either because there are other reasons such as a job requiring the performance of mixed duties not one of which is sufficiently controlling. The decision stands for the principle that under such circumstances claimant’s earning capacity in the occupation during the recent past can be used as an indicator for a finding whether the offered wages satisfy the statutory requirement on prevailing wages.
In all instances where the question of wages is raised, a reasonable attempt should be made to obtain sufficient prevailing wage information. However, where precise information is unobtainable the fact that the wages offered and claimant’s prior earnings correspond or the difference is only slight, may be taken into account.

A-750-1439

Index 755 A.6
1250E-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

NOVEMBER 1956

INTERPRETATION SERVICE - BENEFIT CLAIMS
REFUSAL OF EMPLOYMENT
Hours - Full-Time

REFUSAL - OFFER OF FULL-TIME EMPLOYMENT

A claimant whose last employment was full-time for a substantial period (7 months) does not qualify as a short-time worker so that despite a prior history of considerable short-time employment (2-1/2 years) a refusal of full-time employment is without good cause

A.B. 56,876-56

Referee's Decision: The initial determination of the local office disqualifying claimant from receiving benefits on the ground that, without good cause, she refused employment for which she is reasonably fitted by training and experience and the alternative initial determination holding claimant ineligible to receive benefits on the ground that she was unavailable for employment are overruled.

Appealed By: Industrial Commissioner.

Findings of Fact: We have reviewed the evidence adduced at the hearing before the referee and we find that such evidence supports the following findings of fact made by the referee:

Claimant, an addressograph operator, filed an additional claim for benefits effective June 18, 1956. By initial determination effective June 18, claimant was disqualified for refusal of employment without good cause. By alternative initial determination effective June 18, claimant was ruled ineligible because she was not available for employment.

Claimant is married and has a child age 12. Her husband is a practicing dentist. Since her husband has little time to watch their daughter, claimant originally entered the labor market as a short-time worker. She usually worked the hours 8:30 a.m. to 3:00 p.m. Claimant specifically was employed from January, 1953 to July 1955. At that time her position was abolished. Claimant filed a claim for benefits.

Claimant was interviewed in the employment office concerning employment as an addressograph operator. She indicated her preference for short-time work. Claimant was offered a referral to a utility company for full-time work, she accepted full-time work temporarily. Although claimant did not want full-time work, she accepted full-time work on a temporary basis. After she was employed by the utility company, the company continuously requested claimant to work just a little longer in order to assist it to complete its records for automation. Claimant continued for seven months. Claimant now wants short-time hours. She can secure someone to care for her child part-time but not full-time.

On June 18, claimant refused referral to employment as an addressograph operator for the hours 8:15 a.m. to 5:00 p.m., five days per week because she did not want full-time work. According to the employment representative, some orders are received in the employment office for short-time addressograph operators.

The Board makes the additional findings of fact: The referee's decision overruled both determinations of the local office. The Industrial Commissioner appealed therefrom to the Board.

Appeal Board Opinion and Decision: The referee overruled the refusal disqualification on the premise that since claimant had two and a half years' experience as a short-time worker, the fact that she most recently worked full time for seven months, under the circumstances in this case does not disqualify claimant as a short-time worker. We are unable to agree with the referee's conclusion. Since claimant had worked recently full-time for a substantial period, it cannot be said that she "customarily works less than the full-time prevailing" in her place of employment. (See Section 596.5 of the Unemployment Insurance Law). At the time of filing for benefits, claimant did not qualify as a short-time worker under the Law. We hold, therefore, that her reason for refusing a full-time job on this sole ground was without god cause. In view of the conclusion reached by us, it is unnecessary to pass on the alternative initial determination. The initial determination of the local office disqualifying claimant from receiving benefits effective June 18, 1956 on the ground that, without good cause, she refused employment for which she is reasonably fitted by training and experience is sustained. The decision of the referee is reversed (10/11/56)

COMMENTS

This decision is of particular interest because it tends to clarify conditions under which a claimant may qualify as a short-time worker under Sec. 596.5 of the Unemployment Insurance Law. It supplements an earlier decision wherein it is held that a claimant who for health reasons performed part-time work for approximately six months prior to the filing for benefits was a "short-time" worker (Index No. 755d.5; A-750-919). A comparison with that decision shows that it is the history of substantial employment just prior to filing a claim which is controlling in determining the status.

It should be noted that in the instant case, the claimant has a child age 12 and alleged that "she can secure someone to care for her child part-time but not full-time." However, there is no indication in the decision of the arrangement for child care during the seven months period while working full-time. Presumably, no radical change in circumstances occurred which would provide compelling reasons for reverting back to short-time employment because of domestic circumstances. If there had been convincing evidence of restrictions necessitated by valid parental obligations, it may well be that the Board would have reached a conclusion of unavailability rather than refusal without good cause, since the claimant does not qualify as a "short-time" worker.

A-750-1441

Index 755 D-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

NOVEMBER 1956

INTERPRETATION SERVICE - BENEFIT CLAIMS
AVAILABILITY AND CAPABILITY
Restrictions of Employment
Days - Hours

AVAILABILITY - SHORT-TIME WORKER, QUESTION OF

Claimant last employed on a pattern of four full days per week may register as a "short-time worker" and, while adhering to such pattern may accumulate one effective day in a statutory week.

A.B. 57,228-56

Findings of Fact: A hearing was held at which claimant and representative of the employer and of the Industrial Commissioner appeared. Testimony was taken. Claimant, a taxi driver, filed effective July 2, 1956. By initial determination effective July 1, his benefits were suspended for seven weeks for loss of employment through misconduct. He was further ruled ineligible to accumulate more than one effective day per week, effective July 2 through July 5, and ruled ineligible because of unavailability for employment by initial determination effective August 5. For about 15 years claimant worked for a taxicab company. In 1952 he suffered a heart attack and since then worked three or four days per week. On June 25, 1956, he was involved in an accident resulting in personal injuries, and telephoned the employer shortly after the accident to report it. The employer's rules require reporting such accidents immediately. Claimant made the telephone call as soon after the accident as he could locate a telephone. He was instructed to return to the garage and did so. He was then sent to the insurance company to file an accident report. He worked on June 30, but on July 2 was advised by an official of the employer that his employment was terminated at the insistence of the insurer. Thereafter, claimant looked for work for three or four days per week. Most of the taxicab companies require working five days per week. Since August 6 he has made very little effort to secure work as his condition requires him to rest frequently.

Referee's Decision: The credible evidence compels the conclusion that claimant's employment was terminated at the insistence of the employer's insurer, and not because of any deliberate violation of the employer's rules by claimant. Since he is only able to work at most four days per week, he can only accumulate one effective day of unemployment per week. However, his efforts to secure such work since August 6 have been so extremely limited as to offer no reasonable probability of his securing employment. The initial determination of loss of employment through misconduct is overruled. The other initial determinations are sustained.

Appeal Board Opinion: There are cross appeals from the decision of the referee dated August 27, 1956. The Industrial Commissioner appeals from said decision solely for the purpose of correcting the referee's findings of fact as to the effective day of two separate initial determinations of the local office holding claimant ineligible to receive benefits effective July 2 and August 6, 1956 (erroneously stated by the referee to be August 5, 1956) respectively, because he was unavailable for employment. Claimant appeals from said decision insofar as it rules that claimant was ineligible to receive benefits effective July 2 through July 5, 1956 on the ground that he was unavailable for employment, in that his restriction to employment of no more than four days per week prevented him from accumulating more than one effective day per week, and also insofar as it sustains the initial determination of the local office holding claimant ineligible to receive benefits effective August 6, 1956 because he was unavailable for employment, in that he did not diligently seek employment.

After a careful review of the record, testimony and evidence adduced before the referee, and due deliberation having been had thereon, and having found that the referee's findings of fact and conclusions of law are fully supported by the evidence in this case, and that no errors of fact or law appear to have been made, the Board adopts the findings of fact and the conclusions of law made by the referee as the findings of fact and conclusions of law of this Board except as hereinafter stated: The referee's finding that the initial determination of unavailability based on claimant's restriction to employment of no more than four days a week was made effective July 2 through July 5, 1956 was inaccurate; it was made effective July 2, 1956, to continue for an indefinite period thereafter. The Board finds that claimant was a short-time worker within the meaning of Section 596.5 of the Unemployment Insurance Law.

The Board is of the opinion that the referee made proper findings of fact and correctly determined the issue involved in this case, except as hereinabove and hereinafter stated. Since claimant's employment history was that of a short-time worker, his adherence to a pattern of employment previously established which would prevent the accumulation of more than the one effective day per week did not, in and of itself, render him unavailable for employment. The intention of the legislature to provide for the payment of benefits to persons so situated is evident from the section of the Law cited above. The initial determination of unavailability effective July 2, 1956 was therefore incorrectly issued. Claimant was unavailable as a short-time worker from July 2 through August 5, 1956. However, the record amply supports the referee's decision as to the initial determination of unavailability effective August 6, 1956, which is based upon claimant's lack of diligence in seeking employment.

The initial determination effective July 2, 1956 which holds claimant ineligible to receive benefits because he was unavailable for employment is overruled. The initial determination effective August 6, 1956 holding claimant ineligible to receive benefits because he was unavailable for employment is sustained. The decision of the referee is modified accordingly and as so modified is affirmed (10/26/56)

A-750-1442

Index No. 1505A-2
1545.2

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

December 7, 1956

INTERPRETATION SERVICE – BENEFIT CLAIMS
MISREPRESENTATION – GENERAL

Appellate Division Decision

Matter of Hyman Galitzer, 2 AD 2nd 923

MISREPRESENTATION, CONCEALMENT OF MATERIAL INFORMATION

A wilful false statement within the meaning of the law can be made without an affirmative statement by remaining silent when there is a duty to speak, but whether silence amounts to wilful misrepresentation is dependent on the facts of the situation and the intent of the party who fails to speak; thus a claimant’s failure to come forward with pertinent information does not justify the imposition of the penalty when facts showing such duty to speak and an intent to conceal have not been established.

Referee’s Decision: The initial determinations of the local office (1) holding claimant ineligible to receive benefits effective February 10, 1953 on the ground that he was unavailable for employment or, in the alternative, holding him ineligible to receive benefits on the ground that he was not totally unemployed and charging him with an overpayment of $90 in benefits as a result thereof and (2) holding that claimant wilfully made a false statement for the purpose of obtaining benefits and imposing a forfeiture of 25 effective days as a penalty therefor is overruled.

Appealed By: Industrial Commissioner

Appeal Board Findings of Fact: Claimant, a salesman, worked for an upholstery supply firm from December 1949 to January 9, 1953, when he lost his employment by reason of a lack of work. Claimant filed a claim for benefits effective January 12, 1953 and registered for employment. After losing his employment, claimant arranged to form a partnership with a friend for the purpose of manufacturing foam rubber cushions. On or about February 12, 1953, claimant and this person filed in the County Clerk’s office a certificate of partnership. On February 10 they started to search for premises suitable for the conduct of the business and conferred with an attorney to prepare a partnership agreement. On February 17 they entered into a lease for business premises commencing March 1, 1953. However, they were given possession of the premises on February 17 so that they could put them in condition for operating the business. In the interim, claimant and his partner arranged for the purchase of a machine and cutting table. Claimant arranged for opening a partnership bank account to which he and his partner contributed $2,000 each. Claimant also arranged for electricity and telephone service and purchased foam rubber, the delivery of which he accepted at the business premises. He also mailed circulars announcing the opening of the business. The actual business of the partnership was not commenced until March 2. Claimant’s partner remained at his job until February 28. Claimant had no knowledge of the production phase of the business, but was to act as a salesman. His partner, who was acquainted with production methods, would instruct claimant with regard thereto. During the period in issue, claimant’s search for employment was limited to the examination of newspaper advertisements. He did not call on prospective employers. Claimant did not disclose to the local office his contemplated partnership venture, nor was any inquiry made with respect thereto. Based on a statement by claimant and an investigation conducted by the Division of Employment, the local office issued initial determinations (1) holding claimant ineligible to receive benefits effective February 10, 1953 on the ground that he was unavailable for employment or, in the alternative, holding him ineligible to receive benefits on the ground that he was not totally unemployed and charging him with an overpayment of $90 in benefits and (2) holding that claimant wilfully made a false statement for the purpose of obtaining benefits and imposing a forfeiture of 24 effective days as a penalty therefor. Claimant protested the determination and requested a hearing. The referee overruled the initial determinations and the Industrial Commissioner has appealed to this Board.

Appeal Board Opinion and Decision: The referee concluded that claimant rendered no substantial services to the partnership before March 2 and that he made continued efforts to secure work thereby demonstrating his availability for employment. We do not agree with these conclusions. The record discloses that the services which claimant performed for the partnership were quite substantial in nature. Claimant arranged for electricity and telephone service, looked for and arranged for the purchase of raw material and the machinery necessary to commence manufacturing operations, arranged for the opening of a partnership bank account, personally filed a certificate of partnership in the County Clerk’s office and mailed circulars. All of this consumed considerable time and claimant could not therefore be said to have been available for employment from and after February 10 when the search for suitable business premises was begun. We are not persuaded by his testimony to the effect that he engaged in these activities on Saturdays only. We do not believe that claimant was available for employment. His testimony before the referee, that he was willing to accept employment during the interim and that he examined the newspaper advertisements but found nothing suitable, is not convincing. The commencement of partnership operations was imminent. The preparatory details required of claimant not only his time but also his presence in and about the store. He had invested a substantial sum of money. Under the circumstances, it cannot be said that claimant was genuinely attached to the labor market from and after February 10, 1953 (See Appeal Board, 39,432-53). The referee's decision on the issue of wilful misrepresentation was correct. Claimant made no affirmative statement with regard to his partnership venture, which was to commence in the future. The mere failure to disclose this information, standing by itself, is not the equivalent of wilfully making a false statement, which alone justifies the imposition of the penalty prescribed by statute. (See Appeal Board, 33,081-52). The initial determinations of the local office, holding claimant ineligible to receive benefits effective February 10, 1953 on the ground that he was unavailable for employment and charging him with an overpayment of $90 in benefits as a result thereof, are sustained. The initial determination of the local office, holding that claimant wilfully made a false statement for the purpose of obtaining benefits and imposing a forfeiture of 24 effective days as a penalty therefor, is overruled. The decision of the referee is modified accordingly and, as so modified, is affirmed. (November 27, 1953)

Appellate Division Decision: This is an appeal by the Industrial Commissioner from that part of a decision of the Unemployment Insurance Appeal Board which overruled an initial determination of the Commissioner holding that claimant made wilful false statements or representations to obtain unemployment insurance benefits, and which imposed a forfeiture for 24 effective days pursuant to Section 594 of the statute. Claimant filed an original claim for benefits effective January 12, 1953. The Industrial Commissioner made a determination that claimant was unavailable for employment commencing February 10, 1953, or, in the alternative, that he was not totally unemployed commencing on that date. As a result of this finding an overpayment charge was made against claimant in the sum of $90.00. The Commissioner also determined that claimant made false statements or representations to obtain benefits on February 17^th, February 24^th and March 3^rd, 1953, and a forfeiture of benefits for 24 effective days was imposed. The finding of false representations was made upon the premise that claimant failed to disclose the following facts. After his last employment on January 9^,1953 he entered into a partnership agreement with another individual. They began looking for a place in which to conduct their business about February 10, 1953. A certificate for conducting business under an assumed name was filed by them on February 12^th, and five days later they executed a lease of certain premises for a period of one year. A written partnership agreement between them was executed on February 27^th and each of the partners contributed the sum of $2,000 to be proposed business. None of these facts were disclosed to the Unemployment Insurance authorities. After a hearing before a referee the initial determinations of the Industrial Commissioner were reversed. The Board in turn reversed that portion of the referee’s decision which held that claimant was totally unemployed and available for employment commencing February 10, 1953, and was not overpaid $90.00 in benefits, but sustained that portion which held that claimant did not make wilful false statements or representations in order to obtain benefits. In that connection the Board said: "Claimant made no affirmative statement with regard to his partnership venture, which was to commence in the future. The mere failure to disclose this information, standing by itself, is not the equivalent of wilfully making a false statement which alone justifies the imposition of the penalty prescribed by statute". The Commissioner argues that by this decision the Board has held as a matter of law that a failure to disclose material information cannot form the basis for a determination that claimant made a false statement or representation to obtain benefits. We do not construe the decision of the Board so broadly. It was necessarily limited to the facts of this claim, and thus was a factual determination and not the statement of any principle of law. Of course, a fraudulent representation may be implied by silence when there is a duty to speak, but whether silence amounts to a wilful misrepresentation is dependent upon the facts of the situation and the intent of the party who fails to speak.

On this issue all that the Board has done in this case is to find factually that claimant was not guilty by reason of his silence of making a false representation. Decision affirmed without costs except as hereinafter indicated. In connection with this matter counsel for claimant was assigned by this Court to represent the claimant on this appeal, pursuant to Section 538 subd. 1(e) of the Unemployment Insurance Law. A fee for such services is fixed at the sum of $150.00 and counsel is allowed necessary printing and other disbursements not to exceed the sum of $50.00. An order may be entered accordingly. (November 9, 1956)

A-750-1445

Index 1305A-6

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

JANUARY 18, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
STRIKE, LOCKOUT, OR OTHER
INDUSTRIAL CONTROVERSY
Suspension Period and
Effective Days

Referee Case Number 70-137-56R

STRIKE SUSPENSION PERIOD - EFFECT OF VACATION PAY

The suspension period for loss of employment due to an industrial controversy begins with the date the strike takes effect, even though that date falls into the middle of a period of a plant shut down for vacation purposes for which the striking employees had received vacation pay.

Referee's Findings of Fact: A hearing was held at which claimant and representatives of the Industrial Commissioner and of the employer appeared and testified. The cases were consolidated because of the similarity of the issues. Claimants, foundry workers, filed claims on or about July 2, 1956. By initial determinations effective July 4, claimants' benefits were suspended for seven weeks because they lost their employment through an industrial controversy in connection with their employment. The company was in contractual relations with a union. The contract was to expire on June 30, 1956. The company and the union were negotiating for a new contract. On June 28 the foundry division was shut down for vacations. They were to return to work on July 23. Maintenance and warehousemen and some workers in the machine division were to report to work on July 2. About 180 workers reported. A similar number reported on July 3. At 9 a.m. on July 3, these workers left the plant to take a strike vote. At 12 noon on July 3, the company was notified that the union had approved a strike. Employees left the plant. A picket line was established. On July 23, the employees did not return to work and the picket line continued. Workers received vacation payment in accordance with the contract between the company and the union. Some workers received three weeks' vacation pay. The closing of the plant, for vacation purposes, was at the option of the company. Workers did not need to go to the plant on July 23, as the local radio stations and newspapers announced that the strike was still continuing. Workers contended that they were unemployed during the three-week plant shutdown because of a lack of work and not because of an industrial controversy. According to the employer, the company had arranged with the union to use the three-week period to install machinery. The installers were not permitted to pass the picket lines. The workers in the foundry division will not be recalled for three weeks after the strike terminates, because the machines must be installed.

Referee's Opinion and Decision: In Appeal Board 13,368-46, the Board said:

"Since it is not within the province of the administrators of unemployment insurance to inquire into or determine the merits of any industrial controversy, it seems clear that Section 592.1 is not penal in nature, but is designed to provide what the Legislature deemed a reasonable period during which the State stand aside pending the adjustment of the differences between employer and employees. Accordingly, our interpretation thereof must not be a deterrent to the prompt settlement of labor disputes."

And, again, in Appeal Board 13,748-46, the Board said:

"In our view the Legislature intended that all claimants involved in a strike or other industrial controversy should be treated alike during a single fixed period measured from the day following the strike or industrial controversy. The error in departing from this principle is, we think, illustrated in the referee's distinction between those on sick leave when the strike commenced and those who took sick immediately thereafter. Although both categories obviously merit the same treatment, opposite results were arrived at on an artificial basis. If the strike suspension period in the law were penal in nature, there would be justification of segregating claimants on the basis of their employment, availability and capability. The provisions in question are not penal but rather designed to maintain the State's policy on neutrality in an industrial controversy."

The Board went further, in Appeal Board 21,135-49, and held that where workers who clearly were unemployed because of a strike, receive vacation payments during the suspension period, that such payments were not effective to extend the suspension period. Clearly all claimants, irrespective of vacation payments, were unemployed because of an industrial controversy, effective July 4. The initial determinations as to all claimants are sustained. (August 9, 1956)

COMMENTS

The claimants herein, although they received vacation pay covering a period following the date on which the strike commenced, would have been unemployed thereafter because of the industrial controversy if there had not been a vacation; they withheld their labor beginning with that date. Under such circumstances, claimants were properly disqualified effective the date the strike commenced.

However, there have been and will be cases where some employees continue to be employed under a "paid" status during the industrial controversy with no withholding of labor on their part. For them, because they are not striking or unemployed because of the strike, the effective date of the disqualification is the date the "paid" status terminates. Thus, in A.B. 20,702-49 (not reported in the Interpretation Service), the employer's establishment was closed on April 2 because of a strike, and claimant continued on the employer's payroll until May 20 in a standby capacity. The Board ruled:

"we find that claimant was employed until May 20, 1949. Although claimant was excused from the performance of any services, nevertheless he was subject to call at the employer's pleasure throughout the period for which he received remuneration. The employer had the right to require the rendition of services throughout that period. Claimant therefore lost his employment as of May 20, 1949 and the local office properly suspended his benefit rights as of May 21, 1949."

To the same effect is A.B. 21,135-49 reported A-750-917. The rule in that case states:

"Clerical employees who did not perform actual services after a strike of production workers had commenced, but were given, first advanced" annual paid vacation and then for several weeks their customary salary for "standing by," were held to have continued in employment during the period covered by such payments and to have lost their employment because of the strike as of the end of that period. The suspension of seven weeks began to run thereafter. (Similarly, 20,702-49 and 21,560-49)"

A-750-1446

Index 1505E-2

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

FEBRUARY 2, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
Misrepresentation

Appeal Board Case Number 28,079-51

MISREPRESENTATION - RETRACTION

a false statement made during an interview is nullified so that no forfeit penalty applies when a claimant retracts the statement by disclosing the true fact before the conclusion of the interview.

Referee's Decision: The initial determination of the local office holding that claimant wilfully made a false statement in order to obtain benefits, is overruled.

Appealed By: Industrial Commissioner.

Findings of Fact: Claimant, a salesman, filed for benefits on March 12, 1951. Claimant was due to report at the insurance office on March 27, 1951. He failed to do so. He next visited the local office on April 4, 1951 at which time he requested that he be given credit for the period from March 27 through April 3, 1951. At the interview, he advanced as a reason for his failure to appear at the local office on March 27, 1951, that his mother died and that according to his religious scruples, he was in mourning for a period of seven days thereafter which included March 27, 1951. When pressed for proof, and before the completion of the said interview, claimant admitted that the death of his mother was a pure fabrication. Claimant then stated that the reason he was unable to appear at the local office on March 27, 1951 was that he was ill.

Thereafter, the local office, based on claimant's false statement, issued an initial determination imposing a forfeiture of 20 effective days as a penalty for such misrepresentation. Claimant contested the said initial determination and requested a hearing before a referee. The referee overruled the initial determination on the ground that the claimant, having immediately recanted his original statement and told the insurance interviewer the true facts before the conclusion of the interview, did not wilfully make a false statement in order to obtain benefits. From said portion of the referee's decision, the Industrial Commissioner appealed.

Appeal Board Opinion and Decision: Although claimant concededly made the false statement that he was unable to visit the local office on March 27, 1951 because of the death of his mother, nevertheless, such statement was nullified by a subsequent retraction made before the conclusion of said interview whereby he disclosed that in fact, such statement was a fabrication. (Compare Appeal Board 24,720-50). The initial determination of the local office holding that claimant wilfully made a false statement on April 4, 1951 to obtain benefits is overruled. The decision of the referee is affirmed. (October 11, 1951)

COMMENTS

The decision was not previously released because of its unusual facts and it was felt that the underlying approach is well known. However, the case is now reported since some local offices have recently made initial determinations which are in conflict with the basic principle involved. Although in the here reported case the claimant "immediately recanted his original statement and told the insurance interviewer the true facts before the conclusion of the interview," the same principle would apply where the false statement is corrected on the same day by a reopening of the interview which was held earlier on that day. In A.B. 33,684-52; the Board sustained a referee's decision wherein it was stated:

"The Commissioner's representative, in support of the determination that claimant made a wilful false statement relies on Appeal Board 24,720-50 and 28,079-51. In the cited cases, claimants while being interviewed at the insurance office made false statements but prior to the conclusion of the interview made retractions. The Board held that since claimants had retracted prior to the conclusion of the interview, there was no wilful false statement to obtain benefits. I find no material difference between the cited cases and the case at hand, other than the claimant left the insurance office and returned on the same day and retracted her former statement. The Commissioner's position that claimant's case is distinguishable from the cited cases is rejected. I hod that claimant did not make a false statement or representation to obtain benefits."

A-750-1449

Index 1750-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

April 1, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
VOLUNTARY LEAVING EMPLOYMENT
Trial Period, Adequacy of

Appeal Board Case Number 58,998-57

VOLUNTARY LEAVING TO AVOID PAYMENT OF AGENCY FEE

Voluntary leaving a suitable job is without good cause when the claimant who does not like the job quits it to avoid paying a fee to an employment agency.

Referee's Decision: The initial determination of the local office disqualifying claimant from receiving benefits for 42 consecutive days effective November 19, 1956 on the ground that she voluntarily left her employment without god cause, is overruled.

Appealed By: Industrial Commissioner.

Findings of Fact: Claimant, a receptionist, filed for benefits effective November 19, 1956. Claimant was employed in an office where she assisted three doctors who occupied the same office and had office hours at different periods. Claimant obtained this position through an employment agency and she was required to pay the agency a fee of $60 in three installments of $20 each, in the event she worked on the job more than two weeks. Claimant's duties were to answer the telephone, make appointments, assist in the handling of patients by ushering them into treatment rooms, keeping records of treatment and handling cash. Claimant decided to leave the job because she would have to pay the fee of $60 for the job if she stayed more than two weeks and she felt that if she was paying for a job she should get one that she liked better. The Industrial Commissioner appeals from the decision of the referee overruling the initial determination.

Appeal Board Opinion and Decision: The referee overruled the initial determination on the premise that claimant had good cause to leave the job because she was unable to cope with the duties after a fair trial. We are not in accord with the referee's decision. The evidence indicates that the only reason claimant left the employment was because she did not want to pay a fee for a job which she did not like. Consequently she quit before her obligation to the employment agency became fixed. Claimant did not have good cause to leave her employment within the Unemployment Insurance Law. The initial determination should be sustained. The initial determination of the local office disqualifying claimant from receiving benefits for 42 consecutive days effective November 19, 1956, on the ground that she voluntarily left her employment without good cause, is sustained. The decision of the referee is reversed. (March 15, 1957)

A-750-1456

Index 1625-4

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

JUNE 14, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
VOLUNTARY LEAVING OF EMPLOYMENT

Appeal Board Case Number 511-42-57R

VOLUNTARY LEAVING - DISPOSAL OF CORPORATE INTEREST BY MINORITY STOCKHOLDER

An officer-stockholder of a corporation who is forced out of his job does not quit voluntarily even though, as a consequence, he sells his stock interest.

Referee's Findings of Fact: Claimant, a counterman, filed for benefits effective December 24, 1956 and refiled effective January 21, 1957. By an initial determination effective December 24, claimant was disqualified for 42 consecutive days for voluntarily leaving employment without good cause. This disqualification was deemed terminated when claimant obtained employment commencing with January 9.

Claimant learned of a job opening as a counterman. He applied for this job and learned that the employers required the job applicant to make an investment in the business. Claimant is 25 years of age and single. He told the prospective employers, to whom he was not related, that he had some funds. He thereupon became employed in July, 1956, under an arrangement whereby he purchased one-third interest in the corporation which operated the luncheonette. Three shares of stock were issued to him and he was made the secretary. It was agreed that all three principals would work and that each would be paid $60 per week. Claimant continued to work under the above arrangement until December 21.

Beginning with November, the luncheonette began to experience business losses. By December, the principals realized that the debts so far exceeded the working capital that the firm would have to go into bankruptcy by the end of 1956. The principals decided that since claimant was the last one to join the corporation, he would have to be the one to leave and it would thereby be spared the necessity of paying him his weekly salary. Unless this was done, the entire enterprise would collapse. Claimant was given $1,000 in cash and a series of notes in the amount of $100 each, payable monthly, for a total of $3,000. Claimant had no other definite job prospect when he left the business under the above arrangement. He believed that he would soon be able to secure other work from the Delicatessen and Restaurant Counterman's Union, of which he is a member, and he did secure work through the union beginning with January 9, 1957.

Referee's Opinion and Decision: Claimant asserts that he did not voluntarily leave his employment on December 21, but that he was forced out of his job and that he had no choice in the matter because he was a minority stockholder compelled to accede to the decision which was made by the majority stockholders and he lost not only his job, but at least $1,000 with the possibility that he may in time salvage very little of the $3,000 worth of promissory notes when he sold his tock back to the corporation.

In my opinion, claimant's arguments have merit. He was not an investor in the customary sense. For all practical purposes, claimant's investment consisted of buying a job. Claimant's unemployment by the end of 1956 was uncertain. If he refused to abide by the majority decision of the principals in the corporation, the entire business would have collapsed and he would still have become unemployed.

In support of the initial determination that claimant's sale of his stock interest to the other principals of the corporation constituted a leaving of employment without good cause, the Industrial Commissioner relies upon Appeal Board 53,399-55. In my opinion, the factual situation is substantially different in the instant case from the one relied upon and, for that reason, it is inapplicable. The initial determination that claimant voluntarily left employment without good cause is overruled. (March 5, 1957)

COMMENTS

His employment was terminated by action of the majority stockholders and the separation was not, therefore, of a voluntary nature. The retention of his stock interest would not have saved his job. In the previously reported case it was the selling of the stock which resulted in the termination of the employment while the converse is true in the here reported case.

Other situations where no disqualification would apply would include cases of an officer-stockholder who sells his stock when he cannot continue his association with the corporation for health reasons, or when se severs the relationship because the corporation fails to pay his salary which is due and payable. It should be noted however, that in both these illustrations the officer had good cause for his separation, and the selling of the corporate stock follows therefrom. That again distinguishes such situation from the previously reported cases where the separation was the result of the fact that the officer divested himself of his stock interest.

A-750-1459 Index

1525A-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

SEPTEMBER 4, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
MISREPRESENTATION OR MISSTATEMENT
Miscellaneous

Appeal Board Case Number 61,345-57

FORFEIT PENALTY - ALTERATION IN INSURANCE BOOKLET

The penalty for making a wilful false statement to obtain benefits is incurred by a claimant when he presents an insurance booklet with a placement reporting date which he had deliberately altered even though this fact is discovered immediately and the claimant admits his guilt as the same time.

Referee's Decision: The initial determination of the local office holding that claimant wilfully made a false statement for the purpose of obtaining benefits for which a forfeiture of 20 effective days against her future benefit rights was imposed as a penalty, was overruled.

Appealed By: Industrial Commissioner.

Findings of Fact: We have reviewed the evidence adduced at the hearing before the referee and find that such evidence supports the following findings of fact made by the referee:

Claimant, a power knitter, filed effective January 14, 1957. On April 16, a claims examiner observed that April 28 was a Sunday. Accordingly, he cancelled the due date of April 28 appearing in claimant's identification booklet and assigned Friday, April 26 as the date to report. Claimant did not report to the employment office on April 26 but erased the entry appearing in her insurance booklet and wrote April 29 as her due date. When she reported to the employment office on April 29, the erasure was observed and claimant advised that she had made the change. When she reported to the insurance office on April 30, she signed a summary of interview advising that she had been due to report on April 26, and changed the date in her identification booklet from April 26 to April 29.

The Board makes the following additional findings of fact: The referee sustained the initial determination relating to failure to comply with reporting requirements and overruled the initial determination relating to wilful misrepresentation to obtain benefits. The Industrial Commissioner appealed to the Board from that part of the referee's decision adverse to him.

Appeal Board Opinion and Decision: The referee ruled in effect that the vigilance of local office personnel and claimant's admission that she had altered the date in her reporting booklet prevented her from wilfully making a false statement to obtain benefits. This was based on the premise that a misrepresentation could not occur until claimant reported to the insurance office to certify for benefits for the week ending April 28, 1957. We do not agree with the referee's disposition of the issue of wilful misrepresentation.

Implicit in the referee's decision is the assumption that a claimant can make a statement for the purpose of obtaining benefits only in connection with the certification process at the local insurance office. This is erroneous. Registration at and reporting to both the insurance office and the employment service office, as well as certification to eligibility for benefits are essential steps in the administrative process for the payment of benefits. A false statement may be made at any stage of the proceedings from the time a claim is first filed.

Claimant deliberately altered the reporting date in her identification booklet. She offered no satisfactory reason for doing so. She appeared at the employment office and presented her booklet, thereby representing that she was reporting in conformity with instructions. The fact that claimant admitted her guilt as soon as the alteration was discovered does not serve to excuse her. She did not take the initiative in volunteering the information and presumably would not have made the disclosure had the alteration not been observed by employment office personnel. Claimant was seeking to avoid an initial determination of ineligibility by reason of her failure to report on the date actually assigned to her, which determination would not have been issued had claimant's alteration of her booklet not been discovered. She wilfully made a false representation for the purpose of obtaining benefits by presenting her booklet in its altered condition, knowing that it would be used as the basis for determining her eligibility at least insofar as compliance with reporting requirements was concerned.

The initial determination of the local office holding claimant ineligible to receive benefits effective April 26 through April 28, 1957 on the ground that she failed to comply with reporting requirements is sustained. The initial determination of the local office holding that claimant wilfully made a false statement for the purpose of obtaining benefits, for which a forfeiture of 20 effective days against her future benefit rights was imposed as a penalty is likewise sustained. The decision of the referee is modified accordingly, and as so modified, is affirmed. (August 9, 1957)

COMMENTS

This decision reflects an exception from the general principle that no forfeit penalty applies when a claimant retracts a false statement by disclosing the true facts before conclusion of the interview or by correcting it on the same day through a reopening of the interview (see A-750-1446 and comments). Even though the false statement was not "made" until the claimant presented the booklet, and though it was immediately discovered at the employment office and admitted by the claimant, the Board held that these circumstances do "not serve to excuse" the claimant.

The conclusion to be drawn from this decision is that different standards are applied when a false statement takes the form of presenting an insurance booklet on which the entries made by Division staff have been mutilated by the claimant. It should be kept in mind that such claimant tampered with official records and committed an act which is akin to forgery.

A-750-1461

Index 1205E-4

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

OCTOBER 16, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
REFUSAL OF EMPLOYMENT
Prior to Registration

Appeal Board Case Number 60,962-57

REFUSAL OF EMPLOYMENT ON DAY OF FILING FOR BENEFITS

A claimant who refuses employment on the day when he files a claim may be disqualified even though the filing takes place after the refusal.

Referee's Decision: The referee overruled the initial determination of the Out-of-State Resident Office disqualifying claimant from receiving benefits effective April 22, 1957 on the ground that, without good cause, she refused employment for which she is reasonably fitted by training and experience.

Appealed By: Industrial Commissioner.

Findings of Fact: Claimant left her employment in New York City as a receiving clerk in a retail dry cleaning establishment to move to Florida with her parents. She arrived there on April 10, 1957 and on April 15, and April 22 she reported to the state employment office in St. Petersburg. On April 22 claimant refused an offer of employment as a countergirl in a dry cleaning store at a salary of $35 for a 48-hour week. The referee found that the usual remuneration for such work in the area is $30 to $35 for a 48-hour week. After this refusal of employment and later in the day on April 22 claimant went to the insurance office in St. Petersburg and filed a claim for benefits against New York as the liable state. The claim was made effective April 22, 1957. The Out-of-State Resident Office issued an initial determination disqualifying claimant from receiving benefits effective April 22, 1957 on the ground that without good cause she refused employment for which she is reasonably fitted by training and experience. Claimant protested on the ground that she was not a claimant for benefits at the time of her refusal and requested a hearing. The referee overruled the initial determination and the Industrial Commissioner appealed to the Board.

Appeal Board Opinion and Decision: The referee ruled that although claimant refused employment in her usual occupation and at the prevailing rate of pay, she may not be disqualified because at the time of the refusal she was not yet a claimant for benefits. We do not agree with the referee’s disposition of the case. In Appeal Board 53, 921-56 we considered an identical situation and reached an opposite result. There the claimant had refused employment on the morning of October 11, 1955 and later that same day she filed an original claim for benefits. In sustaining a disqualification against that claimant for refusal of employment without good cause effective October 11, 1955 we said:

Concededly, claimant refused suitable employment earlier on a day for which she is claiming benefits. The law generally does not recognize portions of a day (Gorelick vs. Rosen, 274 N.Y. 64). Claimant, therefore, is subject to disqualification for refusal of employment without good cause. (Compare Matter of Forcarinis, 284 App. Div. 476, affirming Appeal Board 35,617-53).

Since claimant refused employment for which she is reasonable fitted by training and experience and which paid the prevailing rate of wage for similar work in the locality, the initial determination disqualifying her for refusal of employment without good cause must be sustained. The initial determination of the local office is sustained. The decision of the referee is reversed. (October 4, 1957)

COMMENT

This decision reflects an exception to the principle established by the App. Div., in the Matter of Foscorinis, A-750-1308, in which the Court held that a disqualification cannot be imposed when at the time of refusal no benefit claim had been filed. The distinction lies in the premise that the law does not recognize portions of a day, and it is immaterial at what hour the refusal occurred as long as it took place on the day when the claim for benefits was filed.

A-750-1462

Index 1460E-4
1460G-5

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

OCTOBER 28, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
TOTAL OR PARTIAL LUNEMPLOYMENT
Compensation without work - other

Appeal Board Case Number 60,159-57

PAYMENTS TO ENCOURAGE RETURN TO WORK

A claimant is totally unemployed even though he receives weekly payments during a lay-off in consideration for a promise to return to the job when needed by the employer, provided he is not required to render any service and is free to seek other employment during such period.

Referee's Decision: The referee overruled the initial determinations of the Out-of-State Resident Office holding claimant ineligible for benefits effective December 31, 1956 on the ground hat he was not totally unemployed and charging him with overpayments of $108 in benefits.

Appealed By: Industrial Commissioner.

Findings of Fact: Claimant, a blaster filed effective December 31, 1956. By initial determination effective December 31 he was ruled ineligible because of lack of total unemployment and charged with an overpayment of $108.

Claimant has been employed as a foreman by a construction firm since about January, 1954. He was laid off on December 22, 1956, because of lack of work. In accordance with company policy, the employer agreed to pay claimant $50 per week (which represents about 25 percent of his weekly earnings) during any periods from December 24, 1956, to March 16, 1957, while claimant was in a layoff status, as stand-by pay in consideration of claimant’s promise to return to his job when recalled. Claimant was not required to report or shape up during a layoff. The employer’s agreement was not tied in with a union contract. Claimant was permitted to seek and accept any interim employment while in a layoff status during the term of the aforesaid agreement, without prejudice to his weekly stand-by payments. No evidence was submitted that claimant was ineligible for assignment by his union to other employment during his layoff while receiving stand-by payments. In fact, claimant’s interstate claim forms indicate that he registered for work with his union and maintained daily contacts therewith. The employer’s motivation for making this agreement was to encourage claimant to return to his job when his services were needed. The employer does not consider the stand-by payment as remuneration for worked performed or services rendered by claimant in employment. The Board makes the following additional findings of fact: The referee overruled the initial determination and the Industrial Commissioner appealed to the Board.

Appeal Board Opinion and Decision: The Industrial Commissioner contends on this appeal that the referee’s decision is directly contrary to established Appeal Board precedents and that it must be held that the stand-by payments made to claimant constituted remuneration for employment and rendered him totally unemployed. Our decision in Appeal Board 31,003-52 and 44,916-54, relied on by the Commissioner are distinguishable from the instant case. The claimant in the first mentioned case was on half pay during a slack season and we overruled the referee’s ruling that these moneys were in the nature of a bonus for past services and did not constitute remuneration for employment. The instant claimant received a flat sum of $50 per week as stand-by pay, he was permitted to seek and accept other employment and in fact registered for work with his union. Appeal Board 44,916-54 is likewise distinguishable in that we there held that claimant was in effect on a paid leave of absence for which she claimed benefits.

We believe that the referee correctly followed the rule laid down in our recent decisions in Appeal Board 57,331-56; 58,053-56 and 58,936-57 in his holding that the stand-by payments in this case were not remuneration for employment. Appeal Board 57,331-56 involved a payment of $4.30 to a claimant who reported for work in accordance with instructions of the employer but who did not work because the latter had no work for her on that day. Such payment was made pursuant to a union contract. In holding that claimant was totally unemployed on that day, we said:

The payment to claimant was therefore not "for" a day of "employment" which is defined in section 511.1 of the Unemployment insurance Law as ". . . any service under any contract of employment for hire . . .," but rather, in satisfaction of a previously accrued contractual right under the above quoted portion of the collective bargaining agreement.

It has been repeatedly held in court decisions that the determination of total unemployment or lack of it rests not upon the mere receipt of money from the employer, but rather upon to whether the payment was made "for" employment or for some other reason (see Matter of Spinella, 282 App. Div. 974, affirming Appeal Board 33,674-52, Matter of Marshall, 282 App. Div. 531, affirming Appeal Board 30,053-51, Matter of Dresher, 286 App. Div. 591, reversing Appeal Board 47,603-54). Claimant did not receive payment "for" a day of employment and was thus totally unemployed within the meaning of the Law.

In Appeal Board 58,936-57 claimant received the sum of $2.60 pursuant to a union regulation requiring that an employee receive one hour’s pay if he telephones, at the employer’s request, to determine if work is available for him with the employer on that day. Appeal Board 58,053-56 involved the payment to claimant of $2.85 pursuant to a union contract providing for the payment of "stand-by time" where an employee reports to his employer but was not put to work. In both of these cases the Board similarly reached the result that the payments to these claimants were not remuneration for employment and that the claimants were totally unemployed on the days in question.

The initial determination of the local office is overruled. The decision of the referee is affirmed. (August 9, 1957)

COMMENTS

In the instant case, the claimant was not even required to shape up, report or inquire during the lay off regarding possible re-employment. The employer merely exacted from the claimant an oral promise to return to work when his services were needed. In the meantime, the claimant was free to accept other employment and was eligible for job assignments by his union without prejudice to these payments. Thus, there were no obligations or limitations other than a commitment to return if and when needed.

The Board differentiated the case here discussed from that in A.B. 31,003-51, by pointing out that in the earlier case the claimant "was on half pay during a slack season." The board had in that case found as a fact that the claimant received "earnings for a definite period in which operations were suspended." In other words, the employer-employee relationship was found to have terminated in the recently decided case when the lay-off took place whereas such relationship continued during the off season in the earlier case.

A-750-1465

Index 1320E-3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

NOVEMBER 8, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
STRIKE OR OTHER INDUSTRIAL CONTROVERSY
UNEMPLOYMENT, due to

APPELLATE DIVISION DECISION
Gordon D. Sprague, et al, 4 A.D. 2d 911

INDUSTRIAL CONTROVERSY, QUESTION OF: UNION PRESSURE ON THIRD PARTY

An industrial controversy exists if a union pickets on a construction project where work is done by subcontractors for the purpose of exerting pressure on the subcontractors’ principal (a U.S. Air Base) to accede to demands made on that principals, such as demands relating to his employment of certain classes of workers in connection with the project. Thus a suspension from benefits applies to employees of the subcontractors who lose employment because of work stoppage resulting from the picketing although no dispute exists between the subcontractors and their employees.

Referee's Decision: The referee affirmed the initial determination of the local office suspending the accumulation of benefit rights by claimants for seven consecutive weeks on the ground that they lost their employment due to a strike, lockout or other industrial controversy in the establishment in which they were employed.

Appealed By: Claimants.

Appeal Board Findings of Fact: Claimants were employed as a truck driver, operating engineer and carpenter, respectively, on a construction job at the Plattsburgh, New York, Air Force Base. All claimants are members of the unions having jurisdiction over their occupations at the air base. A general contractor and a number of subcontractors of the general contractor were engaged in the construction work at the base and they employed, in addition to workers in claimants’ categories, laborers, plumbers, electricians, iron workers, masons, cement finishers and the like. The plumbing and heating work was subcontracted to F.R. Company, which hired union plumbers, steamfitters and operating engineers to maintain all temporary heat necessary during the construction of the base. Claimants and other members of the various trades working in connection with this project were employed by the respective contractors doing work, all of which were in contractual relations with the various unions having jurisdictions. They were not employed by the Air Force.

Because of the lack of funds, the Air Force decided to terminate the prime contract for heat maintenance with the general contractor and to place civil service employees on the base to maintain temporary heat. This was done as of December 15, 1955 and, in turn, the subcontract between the general contractors and the heating contractor was terminated. At a union meeting it was decided that none of the plumbers or steamfitters would work on the base unless the temporary heat was supplied by union members. Pickets were placed at the various entrances at the base on the morning of December 16, 1955 who carried signs reading as follows:

Plumbers and steamfitters working here are not members of Local 497.

Electricians working here are not members of Local 781.

Operating engineers working here are not members of Local 106.

All persons are free to cross picket lines.

Claimants were scheduled to work on December 16. Claimant G.D.S. crossed the picket line and reported for work to his general foreman who told him there was not work for him on that day. He returned on Monday, December 19 and was told that there would be no further work for him until the first of the year. He thereupon turned in the keys to his truck. Claimant B reported to the job site on the morning of December 16 but did not report to work because of the picket line. Claimant C had previously received a layoff notice effective after the close of work on December 16, he came to the base on the morning of December 16 but did not report to work because he saw the pickets and he would not cross the picket lines unless authorized to do so by his union. Of the hundreds of other workers on the base, some crossed the picket line but there was no work for them on account of the general stoppage of work and others refused to cross the picket line because they would be subject to union discipline if they did. A complete work stoppage at the base resulted and the Air Force then issued instructions to its personnel not to permit civilians to enter the base unless they were certified by the respective employers.

The purpose of the picketing was to bring pressure to compel the Air Force to contract with the general contractor to have the heat maintenance work performed by a subcontractor employing members of the appropriate unions. The union members could only work for a contractor in contractual relations with their union, not for the Air Force directly. No demands were made by any of the unions on any of the employers operating at the base. No dispute existed between the union members and the Air force as to terms and conditions of employment. The dispute was settled on January 21, 1956 when a union contractor was engaged to maintain the temporary heat with a slight reduction in the maintenance cost to the Air Force. Many of the workers employed were not rehired after the termination of the dispute, due largely to the inclement weather.

The local office issued initial determinations disqualifying claimants from receiving benefits for 42 consecutive days effective the respective dates of their registrations for benefits on the ground that they voluntarily left their employment without good cause. Claimants protested and requested a hearing. At the hearing, the determinations were amended to include the alternative initial determinations suspending claimants’ benefit rights for seven consecutive weeks, effective December 17,1955, on the ground that they lost their employment due to an industrial controversy in the establishment in which they were employed. The referee overruled the initial determinations of voluntary leaving and sustained the alternative determinations, from which decision claimants appealed to the Board.

Appeal Board Opinion and Decision: The referee concluded that an industrial controversy existed in this case, on the theory that the concerted action of the various unions above described, constituted a work stoppage for the purpose of exerting pressure through the contractors and subcontractors on the Air Force to accede to demands made by several of the unions. We do not agree that this concerted action constituted "a strike, lockout or other industrial controversy" within the meaning of the Law. No elements of a strike or lockout existed as far as concerned the workmen and their employers. Further, we are unable to find in this case that they were present any of the elements of an industrial controversy, as contemplated in Section 592.1 of the New York State Unemployment Insurance Law. No dispute existed between the various contractors and their employees either with respect to representation or terms and conditions of employment. No controversy had arisen at any time out of the respective interests of these employers and their employees. Neither the mere placing of pickets at the premises where the work was being performed nor the concerted work stoppage which resulted for the purpose of exerting pressure on a third party in order to compel that third party to have certain services performed by contract with a particular type of contractor rather than to have the work otherwise performed, does not create an industrial controversy within the meaning of the Law. Whether or not this can be labeled as a secondary boycott or an economic weapon of some sort or other sort is not material to this case.

Furthermore, do not agree with the referee that the decisions of the Appellate Division in Matter of Bucklaew, 277 App. Div. 805, affirming Appeal Board 18,129-48,and Matter of Wittlaufer, 277 App. Div. 805,affirming Appeal Board 18,177-48 are distinguishable on the facts. In those cases the court held that electricians who became unemployed at the place where they were working because of a strike by employees of other contractors engaged at the same place, and said electricians refused to cross the picket line, had not lost their employment as a result of an industrial controversy in the establishment in which they were employed. In those cases the question involved was as to what constituted the "establishment in which claimants were employed". In the instant case, we have concluded that no industrial controversy existed at all. It follows, a fortiori, that the principle of the court in the Bucklaew and Wittlaufer cases should be applied to the circumstances now before us. Therefore, it is immaterial to consider what might constitute the "establishment" in which claimants were employed, the basis of the referee’s decision.

With respect to the primary initial determinations that claimants voluntarily left their employment without good cause, we are unable to find any basis in the record to support such a holding. There was no work for claimants because of the general work stoppage and even if there had been, their working could have interfered with their retaining membership in their respective unions.

The initial determinations of the local office disqualifying claimants from receiving benefits for 42 consecutive days effective as of the dates of their filing on the ground that they voluntarily left their employment without good cause, and the alternative initial determinations suspending the benefit rights of claimants for seven consecutive weeks effective December 17, 1955 on the ground that they lost their employment due to an industrial controversy in the establishment in which they were employed are overruled.

The decision of the referee is modified accordingly and, as so modified, is affirmed. (April 13, 1956)

Appealed By: industrial Commissioner

Appellate Division Opinion for reversal: The issue is whether claimants were barred from benefits for a period of seven weeks because they lost their employment "because of a strike, lockout or other industrial controversy" (Unemployment Insurance Law, Sec. 592,subd. 1). The work involved was at a United States air base at Plattsburgh, New York. The federal officials, as an economy measure, terminated heating contracts with two prime contractors and replaced the union steamfitters and stationary engineers, who were operating a temporary heating service during the course of construction, with civil service employees. A union meeting was held and it was determined that no union plumbers or steamfitters would work on the project unless the civil service employees were dismissed. Picket lines were established across the various entrances to the base and, although the signs carried by the pickets said "All persons are free to cross the picket line," a work stoppage resulted. Claimants were disqualified for benefits for seven weeks by the Industrial Commissioner upon two theories: (1) that they had left their employment without good cause; (2) that their loss of employment was due to an industrial controversy in the establishment where they were employed. The referee held the first ground to be invalid but sustained the determination that claimants lost their employment because of an industrial controversy. In so determining the referee held that the work stoppage was caused "in order to exert pressure through the contractors and subcontractors on the Air Force to accede to demands made by several of the allied unions" and this he found to be industrial controversy. The evidence would sustain a finding that the procedure adopted by the unions was to exert pressure on the Air Force to reinstate the contract terminated or make a new contract for the employment of the union labor. The Board in effect reversed the referee, holding that no industrial controversy existed, on the ground that the dispute was between the unions and the Air Force and not between the unions and the contractors, who were the employers. It said "Neither the mere placing of pickets at the premises where the work was being performed or the concerted work stoppage which resulted for the purpose of exerting pressure on a third party in order to compel that third party to have certain services performed by contract under a particular type of contractor rather than have the work otherwise performed does not create an industrial controversy within the meaning of the law." The foregoing statement of course is not one of fact but one of law, and we disagree with the conclusion reached by the Board. While it may be said, at least technically, that no lockout or strike existed, certainly an industrial controversy existed. The language of the statute in that respect is very broad and there is no indication in its legislative history or otherwise that the legislative intended to limit such language as narrowly as the Board in this case has construed it.

Decision of the Unemployment Insurance Appeal Board reversed, on the law, with costs to the Industrial Commissioner, and the decision of the referee is reinstated. (October 19, 1957)

COMMENTS

This decision is important since it shows that, in a proper setting, an industrial controversy may exist even though there is no dispute between an employer and his employees.
Although the facts in this decision relate to a construction project, the principle stated is not necessarily limited to that industry. Likewise, although the picketing in this case was for the purpose of exerting pressure on the owner of the project, the U.S. Air Force Base, the same conclusion could result if, instead, a general contractor or some other third party were involved.

A-750-1466

Index 1150A-3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

November 7, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
MISCONDUCT
Other Offenses

Appeal Board Case Number 61,271-57

MISCONDUCT, QUESTION OF – FALSIFICATION OF AGE

Falsifying the date of birth on an application for employment does not constitute misconduct in connection with such employment, when the employer’s pecuniary interests, actual or potential, have not been prejudiced.

Referee's Decision: The referee overruled the initial determination of the local office suspending the accumulation of benefit rights by claimant for a period of seven consecutive weeks effective May 1, 1957, on the ground that she lost her employment through misconduct in connection with her employment.

Appealed By: Industrial Commissioner.

Findings of Fact: We have reviewed the evidence adduced at the hearing before the referee and find that such evidence supports the following findings of fact made by the referee.

Claimant, a file clerk, refiled for benefits effective May 13, 1957. By initial determinations effective May 11, her benefits were suspended for seven weeks for loss of employment because of misconduct in connection therewith.

Claimant worked for an insurance company from April 22 to May 10, submitting her application for employment to the company she gave her date of birth as May 26, 1902. Actually, she was born June 28, 1897. The employer has established a special pension plan under which it hires women, ages 45 to 55, so that the oldest among them may benefit under the plan after having been employed at least ten years. The company will not hire any women over 55 since such employee should not benefit under the pension plan. In establishing this plan the employer desires to invite into the labor market, again, women who have not been employed for some time. The company designates the plan as its "special mature program," and it is designed for the benefit of such female employees. Claimant was not required to submit proof of her age on hiring. Shortly before she became unemployed the employer demanded proof of age. Claimant was unable to produce such proof and her services were terminated.

The Board makes the following additional findings of fact: The referee overruled the initial determination and the Industrial Commissioner appeals to the Board.

Appeal Board Opinion and Decision: We are in accord with the conclusion of the referee that claimant did not lose her employment through misconduct in connection with her employment. While we do not condone the giving of false information, we are of the opinion that something more must be shown in order to sustain an initial determination of misconduct. It was held in UCFE-41-55 that the mere falsification of an application for employment is not misconduct, per se, and that in order to sustain such a determination it must appear that the interests of the employer have been prejudiced. The employer’s pecuniary interest has not been prejudiced or subjected to jeopardy. Neither actual nor potential loss to the employer has been shown. Since that is so, the initial determination of misconduct was improperly issued. Compare Appeal Board 39,840-53 and Appeal Board 43,944-54, in each of which cases the record established that in addition to the false statement on claimant’s application for employment, there was actual or possible damage to the employer’ pecuniary interest.

The initial determination of the local office suspending the accumulation of benefit rights by claimant for a period of seven consecutive weeks effective May 11, 1957, on the ground that she lost her employment through misconduct in connection with her employment is overruled.

The decision of the referee is affirmed. (October 18, 1957)

A-750-1468

Index 1250F-4

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

DECEMBER 16, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
REFUSAL OF EMPLOYMENT
PART-TIME, OFFER OF

Appeal Board Case Number 61,345-57

REFUSAL OF PART TIME HOURS WHICH DIFFER FROM CUSTOMARY

A part-time worker who without compelling reasons refuses proffered employment in which the distribution of total number of hours within a working week merely differs from his customary schedule of working hours, does so without good cause.

Referee's Decision: The referee overruled the initial determination of the local office disqualifying claimant from receiving benefits effective July 31, 1957 for refusing without god cause to accept an offer of employment for which she is reasonably fitted by training and experience.

Appealed By: Industrial Commissioner.

Findings of Fact: Claimant an assistant bookkeeper, has been a part-time worker. She has worked only during the hours from 10 A.M. to 3 P.M. Claimant refiled a claim for benefits effective July 22, 1957 and registered for employment. On July 31, 1957, claimant was offered employment which would have required her to work from 9 A.M. to 5 P.M., three days each week, which she refused. Claimant's refusal was based solely on the fact that she did not wish to work beyond 3 P.M., or 4 P.M. at the latest. There were no circumstances, domestic or otherwise, which would have interfered with claimant's employment under the terms of the job offer.

Based on an interview with claimant, the local office issued an initial determination disqualifying claimant from receiving benefits effective July 31, 1957 on the ground that, without good cause, she refused to accept an offer of employment for which she is reasonably fitted by training and experience. Claimant protested the initial determination and requested a hearing. The referee overruled the initial determination and the Industrial Commissioner appealed to the Board.

Appeal Board Opinion and Decision: The referee, relying on a survey of job orders received by the employment service which disclosed no job orders for part-time workers at the hours which were offered to claimant, ruled that the offer to claimant involved conditions substantially less favorable to her than those prevailing in the locality for similar work and accordingly overruled the initial determination holding that claimant refused the employment without good cause. We do not agree with the referee's conclusion.

The Board has ruled that job orders, which merely reflect what particular employer may be willing to pay rather than what is actually being paid generally, do not constitute acceptable evidence of prevailing wages (Appeal Board 11,354-44). The Information as to prevailing hours in the instant case, being based upon job orders is likewise not considered persuasive proof as to prevailing conditions. The number of hours of work per week required of claimant was not substantially less favorable to her than the number of hours prevailing in the locality of her type of work. At worst it was only the distribution of the total number of hours within the working week which differed (if it did) from the schedule of working hours prevailing for persons in claimant's occupational classification. Claimant did not establish that she could not accept the employment at the hours which were offered to her. She merely asserted that she would not. Under these circumstances her refusal was arbitrary and unjustified, being based upon personal preferences which were not compelling. An offer of employment need not meet each and every condition which claimant may impose. (See Matter of Krieger, 279 App. Div. 681 reversing Appeal Board 25,001-50)

The initial determination of the local office disqualifying claimant from receiving benefits effective July 31, 1957 for refusing, without good cause, to accept an offer of employment for which she is reasonably fitted by training and experience is sustained. The decision of the referee is reversed. (November 22, 1957)

COMMENTS

The decision that claimant refused the employment without good cause is in line with the principle established by the Court in the Matter of Krieger, 279 App. Div. 681; A-750-1061. It re-emphasizes the concept that an offer of employment need not meet each and every condition which a claimant arbitrarily imposes. The test is whether it meets the minimum requirements under the Unemployment Insurance Law.

Claimant, a part-time worker refused part-time work from 9 A.M. to 5 P.M. solely because she previously worked only during the hours 10 A.M. to 3 P.M. Such restriction based upon personal preferences rather than compelling circumstances, does not justify the refusal.

A-750-1469

Index 1410D-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

DECEMBER 18, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
TOTAL OR PARTIAL UNEMPLOYMENT
Excluded employment

Appeal Board Case Number 61,22-57

EFFECTIVE DAYS - EXCLUSIONARY EMPLOYMENT

In determining "effective days" under Section 523 of the law, all employment must be considered, including that not covered by the New York State Unemployment Insurance Law, such as railroad work.

Referee's Decision: The referee overruled the initial determination of the Out-of-State Resident Office holding claimant ineligible to receive benefits effective February 18, 1957 on the ground that he could not file a valid original claim for benefits in that claimant did not have at least one effective day of employment in the week in question.

Appealed By: Industrial Commissioner.

Findings of Fact: Claimant worked in a factory in Elmira, New York from March 6, 1956 to October 9, 1956. Thereafter he worked as a trainman on a railroad. In the week ending February 24, 1957 claimant worked on Wednesday, February 20 and Thursday, February 21 and earned $50.71 which employment was covered by the federal Railroad Unemployment Insurance Act. Claimant attempted to file a claim for unemployment insurance benefits at Towanda, Pennsylvania effective February 18, 1957 against New York as the liable State. An initial determination was issued holding claimant ineligible for benefits effective February 18, 1957 on the ground that he did not file a valid original claim for benefits because he had earned more than $36 during the week ending February 24, 1957.

Claimant was laid off by the railroad on April 23, 1957 and upon another filing for benefits effective April 22, 1957 was ruled ineligible for benefits because he had only 18 weeks of employment in the base year then established.

The referee overruled the initial determination. The Industrial Commissioner appealed to the Board.

Appeal Bard Opinion and Decision: Section 527 of the Unemployment Insurance Law provides:

A valid original claim may be filed only in a week in which the claimant has at least one effective day of unemployment.

Section 523 provides:

No effective days is deemed to occur in a week in which the claimant has days of employment for which he is paid compensation exceeding an aggregate of thirty-six dollars.(Underscoring supplied)

The theory of the initial determination is that since claimant earned in excess of $36 in the week ending February 24, 1957 no effective days could be credited to him in such week and consequently no valid original claim could be filed by him in that week. In overruling the initial determination, the referee relied on Section 511.10 of the Law which reads as follows:

The term "employment" does not include employment subject to the federal railroad unemployment insurance act.

The referee ruled that within the meaning of Section 523 claimant's work with the railroad therefore did not constitute employment. He reasoned that claimant's railroad earnings did not prevent him from accumulating effective days in the week in question and that a valid original claim could therefore be filed in that week since claimant had five days of total unemployment as that term is defined in Section 522 of the Law. We believe the referee has construed the statute too narrowly. The term "employment" appears many times in the Unemployment Insurance Law. It is defined generally as "any service under any contract of employment for hire, express, or implied, written or oral." (Section 511.1) There is no indication that the provision excluding railroad work from the term "employment," as well as other similar exclusions of services such as agricultural labor, as a golf caddy, of a spouse or minor child or of a student, was intended to relate to the "effective day" provisions of the statute. Significantly, in defining "total unemployment" as the total lack of any employment, the statute further provides that "the term 'employment' as used in this section means any employment including that not defined in this title." (Section 522) (Underscoring supplied) It is noted also that in 1955 Section 523 of the Law was amended so that the term "compensation" which appears in the sentence of said section beginning: "No effective days . . ." was substituted for the term "remuneration" which has a narrower meaning in the statute. We are of the opinion that claimant's compensation which exceeded $36, even though received from railroad work which is not deemed employment under our law for certain purposes, barred the accumulation of effective days in the week in question and that it was correctly ruled he could not file a valid original claim for benefits. The initial determination of the local office is sustained. The decision of the referee is reversed. (November 29, 1957)

COMMENTS

This decision deals with a claimant who worked in railroad employment which is excluded from the definition of "employment" (Sec. 511.1) for the general purposes of the Unemployment Insurance Law. However, the principle is not confined to such work but is applicable to all types of "excluded" employment. The underlying theory is that certain employment although "excluded" for other purposes is nonetheless "employment" in establishing whether there is total unemployment within the meaning of Sec. 522 and for the purpose of ascertaining "effective days" under Section 523 of the Law.

Thus, employment such as agricultural labor, services performed outside the State of New York, work as a golf caddy and by an employer's spouse or self- employment will prevent a claimant from accumulating effective days during the period involved.

However, it should be noted that, although self-employment as described in Special Bulletin A-750-39 prevents a claimant from accumulating "effective" days since he is not "totally unemployed," earnings from such employment are not used in determining whether they exceed the allowable maximum in the week. (See A-750-1260; Index 1460 E-12)

A-750-1470

Index 1625-3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

DECEMBER 20, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
VOLUNTARY LEAVING OF EMPLOYMENT

Appeal Board 61,586-57

VOLUNTARY LEAVING - DISPOSAL OF CORPORATE INTEREST BY MONORITY STOCKHOLDER

Claimant, a minority stockholder, threatened by other stockholders with dissolution of the corporation if he failed to sell his shares and sever his employment with the corporation, leaves his employment with good cause for compelling reasons when he yields to such demands.

Referee's Decision: The referee overruled that part of the revised initial determination of the local office effective July 15, 1957 disqualifying claimant from receiving benefits for 42 consecutive days on the ground that he voluntarily left his employment without good cause.

Appealed By: Industrial Commissioner.

Findings of Fact: We have reviewed the evidence adduced at the hearing before the referee and find that such evidence supports the following findings of fact made by the referee:

Claimant, a dairy restaurant manager, filed effective July 15, 1957. By revised initial determination he was disqualified effective July 15, and until 42 days after he shall have established a genuine return to the labor market, on the ground that he voluntarily left employment without good cause and withdrew from the labor market.

Claimant had been a stockholder and officer of various corporations which operated dairy restaurants until about two and a half years ago. Claimant was at all times employed by the corporations of which he was a stockholder. He managed the dairy restaurants operated by such corporations. During those times claimant was usually a 50 per cent stockholder of the corporation.

About two and a half years ago the corporation by which claimant was then employed assigned its lease to a new corporation. The person who held the remaining 50 per cent of the stock of the assignor corporation relinquished his interest in the corporation and claimant, together with three other persons, became stockholders of a corporation which was organized to receive the assignment of the lease.

Claimant became a 25 per cent stockholder of the new corporation which thenceforth operated a delicatessen as well as a dairy restaurant. The remaining stockholders were persons experienced in the operation of a delicatessen. Claimant had no experience in the operation of a delicatessen. He was assigned by the new corporation to manage its dairy department. After a brief period of time one of the four stockholders was forced out of the corporation and his shares of stock were divided among the three remaining stockholders so that claimant became an owner of 33 1/3 per cent interest in the corporation. In the two and a half years period which followed the organization of that corporation, its dairy business gradually diminished and its delicatessen business flourished. By reason of that fact, and because claimant was qualified solely to handle the dairy business, the owners of the remaining 66 2/3 per cent of the stock of that corporation insisted that claimant withdraw from the corporation and sell to them his shares of stock in the corporation. They threatened to bring about the dissolution of the corporation in the event claimant refused to withdraw therefrom and sell his stock to them. Claimant knew that if he were to sell his stock he would be able to realize a profit thereon but that if he refused to sell his stock and the threat of his fellow stockholders were carried out, he would suffer a substantial loss, since the value of his stock on a forced sale would be substantially less than the price he could receive therefor by a voluntary sale. Accordingly, to avoid a dissolution of the corporation, claimant yielded to the requests of his fellow stockholders and he sold to them his shares of stock in the corporation and, thereupon, his employment by the corporation was terminated.

Claimant is 67 years of age and after his association with the corporation was terminated he applied for Federal old age benefits. Nevertheless, it was his intention to remain in the labor market and he was prepared to relinquish his Federal old age benefits in the event that he could obtain employment. He advised the Commissioner's representatives that he was prepared to accept work either as a manager of a dairy restaurant or as a cashier. He has regularly sought work by applying therefor at various private employment agencies and in establishments where he believed that his skill might be utilized. He was not referred to any employment by the public employment office.

We make these additional findings of fact: The referee overruled the revised initial determination of the local office effective July 15, 1957 disqualifying claimant from receiving benefits until 42 consecutive days after certification to his bona fide return to the labor market because of voluntary leaving of employment without good cause and withdrawal from the labor market. The Industrial Commissioner appeals to the Board from the referee's decision insofar as it overruled the portion of said initial determination pertaining to claimant's leaving of employment.

Appeal Board Opinion and Decision: The Board approves and adopts the well-reasoned opinion of the referee which follows:

It is contended on behalf of the Industrial Commissioner that claimant voluntarily left his employment without good cause because he "voluntarily" sold his stock in the corporation, which precipitated the termination of his employment. The facts herein indicate that there was a compelling reason for the sale of claimant's stock. The threats of the majority stockholders brought about a situation which endangered claimant's capital investment in the corporation. If he remained adamant and the threats of the majority stockholders were carried out, there was likelihood that his stock would become almost worthless. Under these circumstances, he had no alternative but to yield to the requests of the majority stockholders and to sell his stock to them. The termination of his employment which resulted was not a voluntary leaving of employment without good cause.

There is no proof purporting to indicate the withdrawal of claimant from the labor market. On the contrary, he had demonstrated a genuine desire to become employed by holding himself available for work for which he is qualified and by engaging in a reasonably diligent, independent search for work.

It is contended by the Industrial Commissioner that our decisions in Appeal Board 60,666-57; 57,735-56; 54,153-56 and 53,399-55 require a reversal of the referee's decision on the issue of voluntary leaving of employment without good cause. In our view, these cases are distinguishable because the claimants therein became voluntarily unemployed through voluntary sale of their stock for non-compelling personal reasons which did not constitute good cause within the meaning of the Unemployment Insurance Law. For example, in Appeal Board 60,666-57 the claimant, a 50 per cent stockholder and corporate officer, sold his stock because of a decline in corporate earnings and disagreements with his associate (the other 50 per cent stockholder and officer). His resulting unemployment was by his own choice; it was not dictated by compelling necessity. Similarly, the claimant in appeal Board 57,735-56 became voluntarily unemployed by the sale of his 50 per cent stock in a corporation to the other 50 per cent stockholder because of friction between them, and also because he did not desire to continue to invest in the business. We stated that "claimant became unemployed as a result of the sale by him of his interest in the corporate employer to the other stockholder of the corporation primarily because of the differences between them. His reason for leaving the employment was personal rather than of a compelling nature, and . . . did not constitute good cause . . ." Similar factual situations existed in Appeal Board 54,153-56 and 53,399-55. The factual situation presented there is different from that in the case cited. We have found that claimant had compelling reasons to sell his stock although he did not wish to terminate his employment. The employer corporation reported to the insurance office tat claimant "did not sell his shares of stock voluntarily. He was a minority stockholder and was compelled by the remaining two stockholders to sell his interest in the corporation due to the fact that the corporation did not want to continue his employment . . . and his services were not required." The employer further reported that claimant became unemployed because of "lack of work - indefinite (permanent lay-off)." We regard as applicable the decision in Case #520-416-57R (affirmed in Appeal Board 61,437-57) where the referee stated in part:

. . . They transferred their stock to buyers who could no longer use their services. This was a salvage measure made necessary by the circumstances recited. It cannot be said that such circumstances were "personal" rather than "compelling." The facts in this case appear to be in line with those found in Case 51-42-57R, in which a referee held that a claimant who sold his stock interest because of compelling circumstances did not voluntarily leave employment. There is no appeal taken from that decision. There, the referee pointed out that the claimant allegedly "was forced out of his job and that he had no choice in the matter because he was a minority stockholder compelled to accede to the decision which was made by the majority stockholders."

Significantly, claimant assiduously searched for work in his occupation and was genuinely in the labor market throughout the period in issue. We conclude that claimant left his employment with good cause. The revised initial determination of the local office is overruled. The decision of the referee is affirmed. (December 6, 1957)

COMMENTS

It has been previously stated that an officer of a corporation who becomes unemployed as the result of selling his interest in the corporation is considered to have left his employment voluntarily and without good cause when his reasons are of a personal rather than compelling nature. On the other hand, a claimant who is "forced out" of his job, and as a consequence sells his stock interests, does not quit voluntarily (A-750-1456). In the here reported case claimant was "forced" to relinquish his stock interest.

A comparison of these cases shows that a differentiation must be made on the basis of a finding whether the loss of employment was the result of the sale of the stock, for which there was no "compelling" reason, or whether the claimant was "forced out" and, because of that, sold his stock.

A-750-1471

Index 1420-3

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

DECEMBER 31, 1957

INTERPRETATION SERVICE - BENEFIT CLAIMS
TOTAL OR PARTIAL UNEMPLOYMENT
Miscellaneous Employment

Matter of Schreiber, 5 A.D. 2nd 745

Appeal Board Case Number 55,345-56

TOTAL UNEMPLOYMENT - SELF EMPLOYMENT

A claimant who works in his own business (3 to 4 hours on each of 3 to 4 nights weekly)is self-employed and therefore not totally unemployed, and it is irrelevant that this work in his own business does not interfere with his seeking or accepting full time employment for wages.

Referee's Decision: The referee overruled the initial determinations of the local office holding claimant ineligible to receive benefits effective April 13, 1955 on the ground that he was not totally unemployed and charging claimant with overpayments of $500.25 in benefits.

Appealed By: Industrial Commissioner.

Appeal Board Findings of Fact: Claimant filed effective April 11, 1955. By initial determination effective April 13, he was ruled ineligible because of lack of total unemployment. He was ruled overpaid $500.25.

From 1934 to 1945 and again beginning with about 1948, claimant was the proprietor of a bar and grill. Throughout that period he was employed in various occupations. His wife has attended to the business during the daytime. In addition, there is employed at the bar a cook, a bartender, and cleaning man. Claimant's investment in the bar was about $10,000. It has always been his practice to visit the bar in the evening and render occasional assistance. He did this while he was employed elsewhere and when he was unemployed. Beginning with the period in issue, claimant visited the bar three or four nights a week and was there about three or four hours each time. He would relieve his wife so that she could attend to other chores. Throughout the period in issue, claimant sought employment. He usually did not visit the bar during normal working hours.

We make the following additional findings of fact: Claimant was regularly employed as a woodworker on commercial automobile bodies from October 1955 to January 1956. His wife was occupied in the operation of the business enterprise an average of 15 hours per day, seven days a week. Claimant relieved her on occasion so that she could enjoy some time away from the business. During the period in issue the gross income from the business averaged approximately $350 a week. The business was operated on a basis varying between $600 monthly loss and a $360 profit. The referee overruled the initial determinations. The Industrial Commissioner appealed to this Board from said decision insofar as herein indicated.

Appeal Board Opinion and Decision: The sole issue presented to us on this appeal is whether or not claimant was totally employed during the period in issue. We are in accord with the referee's decision overruling the initial determination holding that the claimant was not totally unemployed.

The evidence indicates that the revenue derived from the business enterprise was insufficient to maintain claimant's family. He was required to seek and accept work. No question was raised at any time as to claimant's availability for employment. Consequently, the only issue confronting us is whether or not claimant was totally unemployed.

We are in accord with the referee's conclusion that the decision in Matter of Emery, 281 App. Div. 426, affirming Appeal Board, 30,87952, is inapplicable to the situation here under consideration. We agree with the referee that the facts in this case more closely resemble those in Appeal Board, 52,380-55, cited in the referee's decision. It is obvious that it was not claimant's mere proprietary interest in a business venture which rendered him not totally unemployed in the Emery case (supra), but rather the fact that he devoted a substantial portion of the working day to the furtherance of such enterprise while a claimant for unemployment insurance benefits. That factor does not appear in the instant case inasmuch as it has been clearly shown that such time as claimant spent in the furtherance of his business enterprise was during hours other than those when he would normally have been employed. It appears that such activities in connection with the business in which the claimant engaged were not substantial and were merely for the purpose of protecting his investment (Appeal Board, 52,169-55). Such activities appear to have been no greater in extent that when claimant was employed full time.

Upon all the facts and circumstances herein, we are persuaded that insufficient basis exists to sustain the initial determination that claimant was not totally unemployed.

The initial determinations of the local office holding claimant ineligible to receive benefits effective April 13, 1955 on the ground that he was not totally unemployed, charging him with overpayments of $500.25 in benefits and imposing a forfeiture of 69 effective days against his future benefit rights on the ground that he wilfully made a false representation to obtain benefits are overruled. The decision of the referee is affirmed. (June 8, 1956)

Appealed By: Industrial Commissioner

Appellate Division Opinion for reversal: Appeal by the Industrial Commissioner from the portion of a decision of the Unemployment Insurance Appeal Board which affirmed the decision of an unemployment insurance referee and held that claimant was totally unemployed for a period commencing April 13, 1955 and was not overpaid in benefits in the amount specified in the initial determination overruled by the referee.

We find no substantial evidence supportive of the decision appealed from. Accepting claimant's testimony in the light most favorable to him, it appears that he worked 3 or 4 hours on each of 3 or 4 days per week in a bar and grill owned by him. Such self-employment during the period for which claimant sought and received benefits constitutes employment within the meaning of the statute (Labor Law, Sec. 522; Matter of Emery (Corsi), 281 app. Div. 426) and the finding of total unemployment was, therefore, unwarranted, (Labor Law, Sec. 591, subd. 1; Matter of Bunzl (Lubin), 1 A.D. 2d 46). The clear requirement of the section last cited renders irrelevant claimant's contention that this work in his own business did not interfere with his seeking or accepting full-time employment for wages.

Decision reversed and matter remitted for further proceedings, without costs. Foster, P.J., Bergen, Con, Halpern, and Gibson, JJ., concur. (December 19, 1957)

COMMENT

The Court's decision points to the need of ascertaining the extent to which a claimant devotes tome to his own business. It is immaterial whether he performs such work during normal working hours or at hours which do not interfere with his seeking or accepting a job during his customary work hours. The test of total unemployment is whether the services performed are substantial in the light of all the circumstances.

A-750-1472

Index 755 D.8

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

FEBRUARY 1958

INTERPRETATION SERVICE - BENEFIT CLAIMS
AVAILABILITY AND CAPABILITY
Restrictions of Employment
Days - Hours

AVAILABILITY - RESTRICTIONS TO PART-TIME WORK BY FULL-TIME WORKER

A claimant who is compelled by force of circumstances, over which he has no control, to limit himself to part-time work which he can perform and which is obtainable in the labor market, is available for employment even though he has a prior history of full-time employment.

A.B. 62,005-57

Referee's Decision: The referee overruled the initial determination of the local office holding claimant ineligible to receive benefits effective May 13 through May 26, 1957 on the ground that she was unavailable for employment.

Appealed By: Industrial Commissioner.

Findings of Fact: Claimant, a hand sewer on bridal apparel, worked for four months with her last employer on a full-time basis until March 7, 1957. Her work history for many years was on a full-time basis. Because of an injury to her leg which she sustained in the shop, she was unable to do any work at all until May 9, 1957. Then claimant's doctor advised her that she could return to work provided she worked less than full-time for about two weeks. Claimant offered to return to her job on a part-time basis but was told that the employer was "short of work." Claimant looked for work in many other places but was unable to find a job. Claimant's physical condition improved by May 26, 1957, when she was again ready, willing and able to work full-time.

Claimant filed a claim for benefits effective May 13, 1957 and registered for employment. Based on an interview with claimant and a report from her doctor from which it appeared that between May 13 and May 26, 1957 claimant, who had formerly worked full-time, was able to work only part-time, the local office issued an initial determination holding claimant ineligible to receive benefits effective May 13 through May 26, 1957 on the ground that she was unavailable for employment. Claimant protested the initial determination and requested a hearing. The referee overruled the initial determination and the Industrial Commissioner appealed to the Board. The Board affirmed the decision of the referee (A.B. 61,268-57). Thereafter the Board on it own motion, determined to reopen and reconsider its decision.

Appeal Board Opinion: The problem as to the availability for work of claimants who are compelled to seek part-time work, although formerly employed full-time, is not a new one. In Appeal Board 8271-42 the Board recognized that a restriction to part-time work because of compelling circumstances should not automatically result in a finding of unavailability for employment and accordingly ruled claimant ineligible to receive benefits. The Industrial Commissioner argues that such a restriction automatically rendered claimant herein unavailable for employment. Appeal Board 51,432-55 and 55,193-56 are cited in support of such contention. Both of those cases involved claimants who, for reasons personal, but not compelling, limited themselves to part-time work, although they previously worked full-time. These restrictions were imposed in order that not to jeopardize their eligibility to receive social security benefits. The cited cases are obviously not in point here.

The Industrial Commissioner further argues that the decision of the referee affirmed by the Board, is incorrect as a matter of law. The same or similar arguments were advanced and rejected by the Board in Appeal Board, 60,802-57, involving similar facts. We quote pertinent portions of the opinion in that case, reflecting principles which we deem applicable here:

The subject of eligibility for benefits (including the requirement of availability for employment), is contained in Section 591 of the law, which, we think significantly, bears the title "Eligibility for Benefits," and insofar as pertinent, reads as follows:

Availability and capability. No benefits shall be payable to any claimant who is not capable of work or who is not ready, willing and able to work in his usual employment or in any other for which he is reasonably fitted by training and experience. (As amended by Laws of 1953, Chapter 720, effective May 4, 1953) (Underscoring supplied)

It is not contended that claimant was incapable of employment. Only her availability therefor is at issue. Did claimant meet the availability requirement as above set forth? We believe the answer must be in the affirmative. Claimant was "ready, willing and able" to work in her usual employment and indeed, succeeded in finding such work. What then can be considered a bar to her availability? It is argued upon us that claimant cannot be considered available on the premise that although she worked full-time formerly she is now compelled to work part-time. This is not logical. Section 591 of the Law, which deals with eligibility for benefits, does not distinguish between full-time and part-time employment, and we believe that it is by the terms of that section of the Law that claimant's right to receive benefits is to be judged, rather than by the arbitrary assumption that there is an inherent difference between the two schedules of working hours, insofar as eligibility for benefits concerned. (Compare Matter of Lehrman, 281 App. Div. 936, affirming A.B. 30,832-52, where it was held that the Unemployment Insurance Law makes no distinction between temporary and permanent employment)

A-750-1473

Index 825-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

MARCH 3, 1958

INTERPRETATION SERVICE - BENEFIT CLAIMS
CLAIMS, REPORTING AND CERTIFICATION
DUE DELIGENCE

Appeal Board Case Number 63,005-58

FAILURE TO REPORT TO INSURANCE OFFICE - LACK OF CARFARE

Ordinarily, lack of carfare is not an acceptable excuse for failure to comply with reporting requirements.

Referee's Decision: The referee ruled that the initial determination of the local office holding claimant ineligible to receive benefits effective November 20, 1957 through December 1, 1957 because she failed to comply with reporting requirements remains in effect, on the ground that she did not dispute such initial determination.

Appealed By: Claimant.

Findings of Fact: Claimant, a biller-typist, filed for benefits effective August 26, 1957. She was directed to report to the local office on November 2, 1957. Instead, she reported on December 3. Based on claimant's failure to report as directed the local office issued an initial determination holding that she was ineligible to receive benefits effective November 20 through December 1, 1957. Claimant contested the initial determination.

At the hearing before the referee, claimant indicated that she was aware that she was required to report to the local office on November 20 but did not do so until December 3. She also indicated that she did not dispute the said initial determination. On that basis, the referee ruled that the initial determination remained in effect. In addition thereto, he overruled another initial determination which was issued by the local office holding that claimant was ineligible to receive benefits effective November 11, 1957 on the ground that she was unavailable for employment. Claimant appealed from that part of the referee's decision which ruled that the initial determination holding that she was ineligible to receive benefits effective November 20, 1957 through December 1, 1957 remained in effect because she did not dispute such initial determination. Her excuse now is that she was unable to report at the local office on November 20, 1957, as instructed, because she did not have the necessary carfare.

Appeal Board Opinion and Decision: Claimant's explanation that she had no carfare to enable her to report at the local office cannot be accepted as an excuse for not reporting (compare Appeal Board 1347-39).

Moreover, such plea lacks credibility and was interposed as an afterthought. We hold that the local office correctly ruled claimant ineligible to receive benefits. The initial determination of the local office holding claimant ineligible to receive benefits effective November 20 through December 1, 1957 because of her failure to comply with the reporting requirements is sustained. The decision of the referee is affirmed. (February 14, 1958)

A-750-1474

Index No. 910-3
1460G-1

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

August 13, 1959

INTERPRETATION SERVICE – BENEFIT CLAIMS
DETERMINATION OF BENEFITS
Base Year Earnings and Employment

Supreme Court Third Judicial Dept. Dec.
Matter of Price 9 A.D 2^nd 561

Appeal Board Case #61,788-57

ALLOCATION OF EARNINGS; WEEK OF EMPLOYMENT

The week in which a filmed television commercial is used or reused, or the week in which payment therefore is made, and which follows the week of the actual filming is not a "week of employment" as defined by Section 524 of the Law, and the receipt of payments for such use and re-use does not render the claimant employed in such week.

Appeal Board Decision

An initial determination was issued by the local office on May 25, 1956 holding claimant ineligible to receive benefits, effective March 26, 1956, on the ground that she did not file a valid original claim in that she did not have at least 20 weeks of covered employment in her base period. The claimant objected thereto and requested a hearing. A hearing was thereafter held before the referee on July 5, 1956. The referee rendered a decision dated July 12, 1956, sustaining the initial determination of the local office. Claimant thereupon appealed to the Board, and a decision was rendered in Appeal Board 56,753-56, dated November 30, 1956, reversing the decision of the referee. Pursuant to the provisions of Section 534, of the Unemployment Insurance Law, the Board thereafter, on its own motion, decided to reopen and reconsider its said decision in Appeal Board 56,753-56. A hearing was duly held before the Board with respect thereto, at which all parties appeared and were accorded a full opportunity to be heard. The Board heard oral argument on behalf of all interested parties. Based upon the entire record and testimony in this case, the Board makes the following

FINDINGS OF FACT: Claimant, a radio and television artist, filed for benefits, effective March 26, 1956. Her base period was thus established as March 28, 1955 to March 25, 1956. Claimant was credited with five weeks of covered employment and total earnings of $275 in her base period with three employers not involved herein. In addition, she received credit for one week and earnings of $120.60 with the instant employer. She claimed an additional 20 weeks of covered employment in her base period and total earnings of approximately $2,000 with the instant employer.

On or about November 2, 1954, claimant had executed a "Consent and Release" to an advertising agency, acting on behalf of a sponsor, authorizing it to reproduce, broadcast, publish or otherwise use motion picture films and recordings of claimant’s voice, photograph or likeness on television and radio commercials. Said document contained the following provision, among others:

The provisions hereof shall be subject to the applicable terms and conditions of any code or agreement of any union having jurisdiction, including but not limited to the American Federal of Television and Radio Artists Code of Fair Practice for Transcriptions and Recordings for Broadcasting Purposes and the 1953 Producer-Screen Actors Guild Contract for Filmed Commercials.

At about the same time, claimant also entered into an agreement with the agency for her services, which agreement contained the following:

5. Artist shall not render, during any period of use or re-use paid for by Producer hereunder pursuant to the 1953 Producer-Screen Actors Guild Contract For Filmed Commercials, any services of any kind, nature or description directly or indirectly on or in connection with any commercials (live or filmed, spot or program), radio or television programs or series of radio or television programs sponsored on behalf of any product that competes in any way with the product advertised on the filmed commercial(s) produced hereunder.

During any period of use or re-use paid for by Producer hereunder pursuant to the 1953 Producer-Screen Actors Guild Contract For Filmed Commercials, Artist shall not permit the use of Artist’s name, likeness or endorsement, in advertising or publicizing in any manner any product competitive with the product advertised on the filmed commercial(s) produced hereunder. Artist agrees that Producer shall have the right to use, and to license others to use, Artist’s name, biographical material and likeness for publicity, advertising and trade purposes in connection with the product advertised on the filmed commercial(s) produced hereunder . . .

This agreement was subject to all the terms and conditions of the 1953 Producer-Screen Actors Guild Contract for Filmed Commercials. Said document, subject to the provisions of which the "Consent and Release" and the agreement for the rendition of services were executed and entered into by and between the claimant and the agency, contained the following pertinent paragraphs:

RECOGNITION AND COVERAGE

The Guild is recognized by Producer as the exclusive collective bargaining agent for all actors (including narrators, announcers, singers, and stunt men) as described in Section III hereof, employed in the territorial limits of the continental United States of America exclusive of Alaska, in commercial messages made as motion pictures and intended primarily for exhibition over television, herein for convenience referred to as "filmed commercials" or "commercials." The persons covered by this contract are herein referred to as "players." This agreement sets forth minimum wage scales, working conditions, and use and re-use compensation for all such players.

Compensation to players in filmed commercials is based both on the services, which the player renders in the production of such commercials, and on the use, which is made of the finished commercial in which the player has rendered services. This dual basis of compensation springs from the unique nature of the services rendered by players in filmed commercials. . . .

MINIMUM COMPENSATION

On Camera (All Players)

The Producer shall pay the player at the rate of not less than $70 per 8-hour day for commercials made for one designated sponsor. Overtime shall be paid on the basis of the player’s daily salary. Such daily salary is herein called the player’s "daily base pay."
The player shall be paid in the manner below stated, a minimum fee of $70.00 for each commercial in which his services are utilized, which is to be delivered by Producer to any client. As used herein the term "client" means the advertising agency, sponsor or other third person with whom Producer contracts for the production of the commercials. Such payment is herein called the "unit payment." Producer agrees to include in each production contract entered into between Producer and any client, the agreement of such client to pay, either directly to the player or to the Producer for payment to the player, prior to delivery to the client of the commercials (or on or before 21 days after completion of the player’s services, whichever event is earlier), a sum equal to the difference between the player’s daily base pay and the number of unit payments due the player hereunder. Subject to the provisions of Paragraph XII hereof relating to the application of overscale compensation, only one day’s base pay ($70) may be credited against any use payments thereafter due the player for a single commercial.

V. COMPENSATION FOR USE AND RE-USE

A. Kinds of Use

The payments to be made to player for use and re-use of commercials shall be based upon the kind of use, viz., whether as spots or as program commercials and upon the scope of use in each of these categories. . . .

Provisions similar in effect, except as to amount of compensation, are contained in the American Federation of Television and Radio Artists Code of Fair Practice for Transcriptions and Recordings for Broadcasting Purposes, pertaining to commercial use of recorded transcriptions.

Pursuant to the terms of her contract of hire, claimant rendered services in November and December 1954 with respect to the filming of a commercial advertisement. On March 15, 1955, she recorded a transcription for the same producer and sponsor. Claimant received the stipulated compensation for her services in each instance.

The film and the transcription were thereafter used and re-used on numerous occasions. Such use and re-use of the film occurred between January 24 and October 16, 1955, for which claimant was paid additional compensation in accordance with the terms and conditions of her contract and the 1953 Producer-Screen Actors Guild Contract For Filmed Commercials. Between March 28 and October 17, 1955, the transcription also was re-used, for which claimant likewise was compensated pursuant to her contract with the American Federation of Television and Radio Artists Code of Fair Practice for Transcriptions and Recordings for Broadcasting Purposes.

The local office issued an initial determination holding claimant ineligible to receive benefits effective march 26, 1956, on the ground that she did not file a valid original claim in that she did not have at least 20 weeks of covered employment in her base period. Claimant requested a hearing and the referee sustained the initial determination. Claimant appealed to the Board.

OPINION: The referee, in sustaining the initial determination, concluded that claimant did not file a valid original claim, on the ground that she did not have at least 20 weeks of covered employment in her base period. We are now in accord with the conclusion reached by the referee.

Section 511 of the Unemployment Insurance Law defined "employment" as any service under a contract of employment for hire, express or implied, written or oral. Section 524 of the Law defined "week of employment" as a week in which a claimant does some work in employment for an employer liable for contributions or for payments in lieu of contributions under this article.

In this case, the employer-employee relationship ceased absolutely after the initial rendition of the services in question. There merely remained a contractual obligation upon the part of the employer to pay the claimant an additional sum for the services originally rendered. Such payment was to become due on some indeterminate date in the future and upon the occurrence of a specified event; namely, the re-use of the product of claimant’s work (compare Appeal Board 14,542-47). At the time the additional payments were made to the claimant herein she no longer was under the supervision, direction or control of the employer. Her work was completed then. The employment relationship between the parties to the contract had terminated upon the completion of the actual filming or recording of the television or radio commercial, as the case may be. The re-use payments which claimant received were not "for" a day or a week of "employment," as defined by Sections 511 and 524 of the Law, but in satisfaction of a previous contractual obligation on the part of the employer (Appeal board 57,331-56).

It is "remuneration" for services performed under a contract of hire which gives rise to "employment." The issue, therefore, is whether this claimant was paid re-use fees for certain days of "employment." The payments which she received after her actual work had ceased was manifestly part of the original contract of employment for services actually performed in connection with the filming and recording of the radio and television commercials and was in addition to the regular fees originally received for such work. The payments were not made for days of "employment" during the additional weeks in issue herein. On the contrary, the right to such payments was measured by previous services already rendered all of which occurred prior to the periods in issue and they were "in the nature of contractual payments due for past services." It follows, therefore, that since claimant was totally unemployed within the meaning of the Law during the various periods in issue, she should not be credited with weeks of employment merely because she received additional monies based upon and resulting from antecedent services.

In our previous decision herein (Appeal Board 56,753-56), we drew an analogy between this case and those involving professional athletes employed pursuant to an annual contract (Matter of Bell, 282 App. Div., 634, reversing Appeal Board 33,901-52, and Matter of Kaftan, et al, 283 App. Div. 759, reversing Appeal Board 34,619-52). In those cases, the respective claimants were held ineligible to receive unemployment insurance benefits on the ground that they were not totally unemployed even though they did not actually perform any physical work. Upon reconsideration, we arrive at a conclusion contrary to that previously made. The facts and the contracts construed herein are different from those in the cases above cited. The claimant therein was not required to hold herself in readiness to render or perform services at the employer’s beck and call, during the entire contract period as was the situation in Matter of Bell, and Matter of Kaftan, supra.

Aside from the legal conclusions drawn from the facts and contracts construed herein, we observe that it would be impossible to administer the payment of benefits based upon re-use fees as contracted herein. The arbitrary payment of re-use fees on dates long after the actual rendition of services would provoke all sorts of anomalous situations affecting individual claimants and would result in multiple determinations of disqualifications and forfeitures affecting the recipients of such re-use fees.

Upon all the facts and circumstances herein, and in line with the foregoing reasoning, we conclude that claimant did not have any "employment" during the respective periods in issue. She performed no work for the employer nor did she render any services whatsoever during said periods. She received a sum of money in payment for a pre-existing contractual obligation assumed by the employer based upon its adherence to the 1953 Producer-Screen Actors Guild Contract For Filmed Commercials. This did not constitute "compensation" allocable to the periods either when the commercials were re-used or when payment for such re-use was made to claimant. Consequently, claimant must be deemed totally unemployed during the respective periods under consideration and not entitled to be credited with weeks of employment therein (Appeal Board 56,400-56 and 57,641-56). Identical reasoning may be applied to claimant’s agreement to make a transcription for use and re-use on radio.

DECISION: The Board’s decision dated November 30, 1956, (Appeal Board 56,753-56) is reopened and reconsidered, and upon such reopening and reconsideration, the same is hereby rescinded. The initial determination of the local office holding claimant ineligible to receive benefits effective March 26, 1956, on the ground that she did not file a valid original claim in that she did not have at least 20 weeks of covered employment in her base period is sustained. The decision of the referee is affirmed. (March 14, 1958)

Supreme Court Appellate Division Decision

Appeal by the claimant from a decision of the Unemployment Insurance Appeal Board, which denied her, claim for unemployment benefits.

The claimant applied for benefits on March 26, 1956. During certain weeks in her base period she received fees for the re-use or re-run of certain filmed television and transcribed radio commercials. She was paid a fixed amount at the time the commercials were made and the re-use fees were received pursuant to her employment contract and the general collective bargaining agreement governing such work. The re-use fees were based on the market to which the commercial was presented. In order to have the requisite 20 weeks of covered employment making her eligible for benefits it was necessary to count the weeks in which such re-use fees were received. The referee held that since no services were performed in those weeks that they did not constitute weeks of employment and declared the claimant ineligible for benefits. The Board first reversed and then after reconsidering the case on its own motion reversed its initial determination and affirmed the referee’s decision.

Section 524 of the Labor Law defines a "week of employment" as "a week in which a claimant did some work in employment. . . ." In view of the wording of this section it would seem that the Board correctly determined that the claimant had performed no work in the weeks in which she received re-use fees. The Board found that the employee-employer relationship terminated once the commercials were made. There was no direction, supervision or control over the claimant at the time the commercials were re-used. The only restriction on her was that under her contract she would not appear for a competitive product during this period. This however left her free for employment by anyone else and this restriction can not be the basis for holding that the claimant was doing "some work" when these payments were received. These fees were in realty earned with the commercial was made and their amount depended only on the use of the commercials thereafter and no on any work or service to be performed by the claimant.

Decision unanimously affirmed and without costs.

A-750-1477

Index No. 780B.2

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICE OFFICE

May 2, 1958

INTERPRETATION SERVICE – BENEFIT CLAIMS
DETERMINATION OF BENEFITS
AVAILABILITY AND CAPABILITY Saturday and Sunday

Appeal Board Case number 62,584-58

ILLNESS COMMENCING PRIOR TO AND INCLUDING SATURDAY AND SUNDAY

A five-day worker may receive credit for Saturday and Sunday even though unavailability or incapability commences prior to Saturday and continues through Sunday.

Referee’s Decision: The initial determination of the local office holding claimant ineligible for benefits effective October 11 through October 13, 1957 on the ground that he was not capable of employment is sustained.

Appealed By: Claimant

Findings of Fact: Claimant, a punch-press operator, filed a claim for benefits effective September 30, 1947. At an interview in the local office on October 17, 1957 claimant disclosed that he had been ill with influenza on the previous Friday, Saturday and Sunday. His booklet was marked to indicate that he was unable to work on October 11, 12 and 13. Claimant works five days a week and does not normally work on Saturdays and Sundays.

The local office issued an initial determination holding claimant ineligible for benefits effective October 11 through October 13, 1957 on the ground that he was not capable of employment. Claimant’s claim was reinstated effective Monday, October 14, 1957.

Appeal Board Opinion and Decision: Claimant contends that since he does not normally work on Saturdays and Sundays, his illness on October 12 and 13, 1957 should not affect his entitlement to benefits for those days. The referee ruled on the basis of the decisions in Appeal Board, 32,619-52 and 443,587-54 that such fact was not controlling and that the initial determination was correct. Upon reconsideration of applicable precedents, we arrive at an opposite conclusion herein.

Our decision in Appeal Board, 443,587-54 was handed down on April 30, 1954. In a later case, Appeal Board, 47,564-55 dated January 26, 1955, we established the rule that a claimant is entitled to credit for a Saturday and Sunday, even though actually not available for employment on those days, provided that he is a five day a week worker and does not work normally on Saturday and Sunday. In a later case we reiterated this principle, stating that "Saturday and Sunday are days of rest, and a claimant need not be available for employment on those days unless the occupation in which he is engaged customarily requires Saturday and Sunday work." (Appeal Board, 56,918-56).

The concept of the effective day plan is a purely mechanical formula designed to permit the payment of benefits on a daily basis rather than on a weekly basis, as provided previously in the Law. Giving Credit to five-day workers for unemployment on Saturday and Sundays, as part of such plan, is a fictional device in order to carry out the effective day formula. We deem our decisions in 47,564-55 and 56,918-56 to be more in keeping with the purpose and concept of this formula than our previous decisions and we believe that they represent the true intention of the statute.

We accordingly hold that based on these decision claimant, since he need not be available for or capable or employment on those days, should receive credit for Saturday and Sunday, October 11 and 12.

To the extent that our previous decision in Appeal Board, 43,587-51 is to the contrary, it is hereby overruled. We observe in passing that such decision was in short-form and did not give any reasons or basis for the result reached. We deem our later decisions to be controlling. The initial determination of the local office holding claimant ineligible for benefits effective October 11 through October 13, 1957 on the ground that he was not capable of employment is modified to make it effective October 11, 1957 only. The decision of the referee is modified accordingly and, as so modified, is affirmed. (April 18, 1958).

COMMENTS

This decision is important since it nullifies prior decisions in the Service stating that Saturday and Sunday are not credited as days of total unemployment when unavailability commences prior to Saturday and continues through Sunday.

The new principle is to the effect that a claimant, who does not ordinarily work on Saturday and Sunday, need not be available or capable on such days regardless of when unavailability or incapability commenced.

Releases A-750-1151 and A-750-1292 are now obsolete and should be so marked.

A-750-1488

Index 1315-9

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

AUGUST 6, 1958

INTERPRETATION SERVICE - BENEFIT CLAIMS
STRIKE OR OTHER INDUSTRIAL CONTROVERSY

Appeal Board Case Number 64,684-58

INDUSTRIAL CONTROVERSY: TRUCKING TERMINALS

A strike at one or more of the terminals operated by a trucking company is not extended to another of the employer's terminals where the workers, locally employed, are laid off despite no demands, strike declaration, or picketing since the terminal can be identified as a separate establishment from the standpoint of employment.

Referee's Findings of Fact: A hearing was held at which claimant and representatives of the employer and the Industrial Commissioner appeared. Testimony was taken. Claimant, a truck driver, filed effective December 30, 1957. By initial determination effective December 28 through March 3, 1958, claimant's benefits were suspended because of loss of employment due to an industrial controversy in the establishment in which he was employed. The Commissioner's representative amended the initial determination to be effective from December 28, 1957 through February 3, 1958. Claimant was ruled overpaid $144 which was ruled to be recoverable. The employer is in the trucking business. It hauled freight between terminals. It had terminals in Albany, Poughkeepsie and other places. Claimant was a "city driver." It was his job to haul freight between points in the immediate vicinity of Albany and the Albany terminal. This freight was carried to or received from the other terminals in the employer's system. On December 23, 1957, a strike was called against the employer's Poughkeepsie terminal and some other terminals. The local union in the Albany terminal was not on strike. No workers in that terminal were on strike. No pickets were placed around the Albany terminal. The Albany terminal continued to operate from December 23 through December 27. During this time it handled only business to and from non-struck terminals. The employer's president decided that the employer could not make any money this way and shut down the entire operation. Subsequently, a general manager was engaged to resume some operations, but the strike continued in the terminals where it started. Claimant was recalled to work on April 4, 1958.

Referee's Opinion and Decision: This case is similar to Appeal Board 48,001-54. In that case the employer was an interstate trucking firm. A work stoppage occurred at a terminal in Birmingham, Alabama. Because no shipments were received for local delivery, the New York City terminal was shut down. However, none of the employees in the New York City terminals were on strike. Their local union was not on strike and there was no picketing at such terminal. The Appeal Board held that the employer's New York City terminal was a separate establishment from the point of view of employment and that there was no industrial controversy at such establishment. It follows that the Albany terminal is an establishment separate from the Poughkeepsie terminal. While claimant's loss of employment was due to the industrial controversy at the Poughkeepsie terminal, there was no industrial controversy at the Albany terminal where claimant was employed. Claimant's unemployment was not due to an industrial controversy in the establishment in which he was employed. The initial determination is overruled. Claimant was not overpaid.

Appealed By: Industrial Commissioner.

COMMENT

This decision is in line with the principle established in Matter of Machcinski, 277 AD 634, (A-750-915 (Rev.)) in which the Court ruled that whether plants at different locations are separate establishments within the meaning of the U.I. Law, must be determined from the "standpoint of employment."

In this case claimant was a "city driver" employed locally in the Albany terminal where no controversy existed. It was concluded that claimant's unemployment was not due to an industrial controversy in the establishment in which he was employed.

A-750-1489

Index 1525A-2

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

AUGUST 6, 1958

INTERPRETATION SERVICE - BENEFIT CLAIMS
MISREPRESENTATION OR MISSTATEMENT
Miscellaneous; General

Appeal Board Case Number 64,161-58

FORFEIT PENALTY - ALTERATION OF PLACEMENT DATE

Alteration of reporting date in claimant's booklet with intention of misleading employment office into believing that a later date was the correct date to report thereat is a wilful misrepresentation, although discovery of the alteration at the insurance office was made prior to claimant's failure to report properly at the employment office and she reported there as originally required pursuant to further directions.

Referee's Findings of Fact: Hearings were held at which claimant and representatives of the employer and the Industrial Commissioner of Labor appeared. Testimony was taken. Claimant, a translator, filed effective January 20, 1958. By initial determination effective January 20, she was disqualified for 42 days following certification of her return to the labor market for voluntary leaving of employment without good cause and withdrawal from the labor market. Her benefits were further forfeited for 20 effective days because of a wilful false statement to obtain benefits made on January 27. From July 14, 1947 to June 28, 1957, claimant worked for a reinsurance firm. On January 1, 1955, she received a salary increase from $44 to $45 per week. Several requests for further increases thereafter were refused, and early in 1957 she advised the employer that if she did not receive another increase, she would leave. He request was denied, and she informed the employer that she would leave at the end of June, when she would be 65 years of age and eligible for Federal old age benefits. The prevailing rate of pay for such work is $4,742 per year. Prior to this employment claimant had worked for three years for a Federal agency, and from 1934 to 1942 had worked in a bank in Canada as a translator of banking and legal documents. After leaving her job claimant looked for part-time or full-time work as a translator or clerk by applying to at least six employment agencies specializing in jobs for translators and office employees. She also examined and answered want ads for clerks and typist, but was not hired because they want younger people. When claimant filed her claim for benefits, she was assigned January 28 to report to the employment office, and an entry to such effect was made in her identification booklet. The entry was not clear to her and she was uncertain whether the date was January 28 or January 29. On January 26, she was suffering from a cold and felt that she would be in a better position to report on January 29. She accordingly went over the date to report and make it clearly January 29. On January 27 she reported to the insurance office and signed a summary of insurance interview reciting that she had made such change for that reason. She was again instructed to report to the employment office on January 28, and did so.

Referee's Opinion and Decision: Claimant had god cause to quit her job with the reinsurance firm since she had received no salary increase for more than two years, her request for such an increase was denied and the remuneration being paid to her was substantially less favorable than that generally prevailing for similar work. Her efforts to secure work thereafter demonstrated that she did not withdraw from the labor market. Although claimant should not have made any alteration in her identification booklet with respect to the date to report to the employment office, she committed no misrepresentation to obtain benefits. The mere change of date in claimant's booklet does not in and of itself constitute making of a false statement to obtain benefits. It is only when such alteration is represented to the representative of the Industrial Commissioner, and he is requested to rely upon the validity thereof of the purpose of obtaining benefits, that a claimant completes the making of a wilful, false statement, upon which the law imposes a penalty. (Appeal Board 60,126-57). When claimant reported to the insurance office on January 27, it was for the purpose of certifying for the week ending January 27, and whether she was due to report to the employment office on January 28 or January 29, was completely immaterial with respect to her certifying for benefits for the week ending January 26 and, accordingly, she made no attempt to obtain benefits on the basis of the changed entry in her booklet. The initial determination is overruled.

Appealed By: Industrial Commissioner.

Appeal Board Opinion and Decision: After a review of the record including testimony and evidence adduced before the referee, and due deliberation having been had thereon, and having found that the referee's finding of fact and conclusions of law are fully supported by the record in this case, and that no errors of fact or law appear to have been made, the Board adopts the findings of fact and the conclusions of law made by the referee as the findings of fact and conclusions of law of the Board, except as follows: A notation was made in claimant's booklet that she was to report at the employment office on January 28, 1958. On January 26, she altered the entry in the booklet to make it appear that she was required to report at the employment office on January 29 instead of January 28. Claimant gave conflicting explanations for the unauthorized alteration. Allegedly she was uncertain whether or not the original entry in her booklet was January 28. She altered the date because she preferred to report at the employment office the next day. She had a cold and believed one day's delay in reporting would not matter. The Board is of the opinion that the referee made proper findings of fact and correctly determined the issues involved in this case, except as herein modified. We are not convinced by claimant's explanation for her alteration of the reporting date in her booklet. She was at the local office on January 27, at which time she could have verified that January 28 was her date to report at the employment office and requested permission to report one day later. She did not disclose to the local office that she had altered the reporting date in her booklet until she was questioned about it. We find that she intended to mislead the employment office into believing that January 29 was the correct date to report thereat. Under all the circumstances, we hold that claimant made a wilful misrepresentation to obtain benefits within the meaning of the Unemployment Insurance Law. (Compare Appeal Board 64,118-58 and 59,286-57). The initial determination of the local office holding that claimant wilfully made a false statement to obtain benefits for which her future benefit rights were forfeited for 20 effective days is sustained. The decision of the referee, insofar as appealed from is reversed. (July 18, 1958)

A-750-1490

Index 1730-2

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

SEPTEMBER 4, 1958

INTERPRETATION SERVICE - BENEFIT CLAIMS
VOLUNTARY LEAVING
Personal Affairs

Appeal Board Case Number 65,606-58

REFUSAL TO ABANDON TRIP ABROAD, AFTER GRANTED LEAVE HAD BEEN CANCELLED

No disqualification for a voluntary leaving of employment applies to a claimant whose employment is terminated upon refusal to cancel a vacation trip abroad when a leave for this purpose had been granted and when in reliance thereon, he had incurred expenditures and would have suffered a substantial financial loss by the cancellation of the trip.

Referee's Decision: The initial determination of the local office disqualifying claimant from receiving benefits for 42 consecutive calendar days, effective May 19, 1958, on the ground that she voluntarily left her employment without good cause is sustained.

Appealed By: Claimant.

Findings of Fact: Claimant was employed as a file supervisor. Her sister planned and arranged to make a trip abroad. She booked passage on airplanes which were to leave April 21, 1958 and return May 18, 1958 respectively. Due to the sudden illness of her sister, claimant was offered the opportunity to make the trip in her stead. Claimant applied to her supervisor for a leave of absence in order to make the trip. Such leave was granted upon condition that she relinquishes her summer vacation. This was agreeable to claimant.

Relying upon the granting of her leave of absence, claimant made the necessary preparations. She incurred substantial expenses, obtained a passport and submitted to vaccinations. Four days prior to the scheduled trip, claimant was informed that her leave of absence was cancelled because it was granted through error on the part of her supervisor. Claimant was then informed that if she made the trip it would be at the risk of her job. Claimant deemed it too late to rescind the trip arrangements and had no alternative but to submit the requested resignation. Had claimant cancelled her reservation, a substantial loss would have been suffered.

Claimant refiled for benefits effective May 19, 1958. The local office issued an initial determination disqualifying her from receiving benefits for 42 consecutive calendar days effective May 19, 1958, on the ground that she voluntarily left her employment without good cause.

Appeal Board Opinion and Decision: The referee, in sustaining the initial determination concluded that claimant left her employment without good cause because it was based upon personal considerations. We do not agree with this conclusion.

The trip in question involved the expenditure of a considerable sum of money. Claimant arranged to make the trip only after she had been granted a leave of absence. Claimant, in reliance thereon, proceeded to make the necessary preparations. Her demanded resignation, which followed her refusal to abandon the trip, was submitted by claimant not of her own free choice, but at the request of her supervisor.

We hold that under all the circumstances herein, claimant did not voluntarily leave her job. Virtually, she was discharged. She did not provoke her discharge.

The initial determination of the local office disqualifying claimant from receiving benefits for 42 consecutive calendar days effective May 19, 1958, on the ground that she voluntarily left her employment is overruled. The decision of the referee is reversed. (August 22, 1958)

COMMENTS

In a previous case dealing with a claimant who left his employment to make a trip abroad (A-750-1358), the Appeal Board held that the voluntary leaving was without good cause. There are several factors which distinguish that case from the one here reported. In the earlier case, the employer did not grant a leave of absence and the claimant was made aware that he assumed the risk of being re-hired upon his return. Also, and perhaps more important, there was no evidence that claimant would have sustained a substantial money loss.

In the present case the claimant relied upon the fact that a leave of absence had been granted and had made all necessary preparations at a considerable expenditure. The decision emphasizes that a substantial financial loss would result from the cancellation of the reservations.

A-750-1492

Index 1420-9

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

SEPTEMBER 10, 1958

INTERPRETATION SERVICE - BENEFIT CLAIMS
TOTAL OR PARTIAL UNEMPLOYMENT
Miscellaneous Employment

Appeal Board Case Number UCFE-243-58

TOTAL UNEMPLOYMENT, QUESTION OF: FARMER

Claimant is not totally unemployed when he assumes full responsibility for the operation of his farm (250 acres; about 49 cows) and devotes thereto a substantial portion of his time (four or five hours daily).

Referee's Decision: The referee sustained the initial determinations of the local office (1) holding claimant, a former Federal employee filing for unemployment compensation under Title XV of the Social Security Act, as amended, ineligible to receive benefits effective august 5, 1957 on the ground that he was not totally unemployed and, in the alternative, was not available for employment, and (2) charging him with overpayments of $612 in benefits by reason thereof.

Appealed By: Claimant.

Findings of Fact: Claimant, 54 years of age, worked for about five years at Sampson Air Force Base as a stationary engineer. Claimant resides on a farm located about 30 miles from the base. He was compelled to leave this employment because of transportation difficulties. Claimant had purchased the farm in 1948. Since 1952, claimant has lived in the farmhouse and operated the farm. His son who is 26 years old assists him in its operation on a salary basis.

Claimant filed an original claim for benefits effective August 5, 1957. When originally interviewed at the local office, he disclosed that he was living on a farm and that he had been doing some work on the farm. He stated further that such work would not interfere with his acceptance of employment and that he was seeking work by personal applications to local employers. Claimant continued to report weekly thereafter and benefits were authorized and paid to him in the amount of $612 for the period ending December 15, 1957. During this period claimant devoted substantial periods to the operation of the farm.

On December 30, 1957, the local office issued initial determinations holding claimant ineligible for benefits effective August 5, 1957 on the ground that he was self-employed, being engaged in farm operations and repairs to buildings, or in the alternative, that he was unavailable for employment because he was devoting his time to these activities. He was also charged with overpayments of $612 in benefits. Claimant protested and requested a hearing on the grounds that he received no income from the farm that he performed only minor labor on his house and that he was available for work at all times.

Appeal Board Opinion and Decision: The referee sustained the initial determination of lack of total unemployment on the basis that claimant was operating a large farm to which he devoted substantial hours each day. The present record supports such conclusion of the referee.

Admittedly, claimant has at all times assumed the full responsibility for the operation of the farm. He devoted substantial portions of his time to the operation of the farm equipment and implements. Although part of the work was performed by his son, the extent of claimant's activities in connection with the farm were such that he may not be considered as having been totally unemployed during the period in question. It is unnecessary therefore to pass upon the alternative issue of unavailability for employment.

By reason of our holding, claimant was overpaid $612 in benefits. The initial determination issued to claimant on December 30, 1957 set forth that repayment of such amount is required. That was in effect a determination that the amount of the overpayment was recoverable. The referee did not rule on this phase of the case. We are of the opinion that claimant accepted the benefits in good faith and that he did not fail to disclose to the local office pertinent facts which would have affected the initial determination as to his filing of a valid original claim for benefits. He advised the local office at the outset that he lived on his farm and performed some work there. Under such circumstances, the benefits which claimant received are not recoverable.

The initial determinations of the local office holding claimant ineligible for benefits effective August 5, 1957 on the ground that he was not totally unemployed and that he was overpaid $612 in benefits are sustained. The benefits received by claimant are not recoverable.

The decision of the referee is modified accordingly and, as so modified, is affirmed. (August 29, 1958)

COMMENTS

This case is in accord with the general principle that a claimant who devotes a substantial portion of his time in his own business is not totally unemployed.

A-750-1494

Index 1315-10

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

JULY 6, 1961

INTERPRETATION SERVICE - BENEFIT CLAIMS
STRIKE OR OTHER INDUSTRIAL CONTROVERSY

Establishment, Question of

COURT OF APPEALS DECISIONS
L.A. FERRARA, et al 10 NY 2d 1
CHARLES CURATALO 10 NY 2d 10

INDUSTRIAL CONTROVERSY, DEFINITION OF "IN THE ESTABLISHMENT"

Where an employer's enterprise is conducted in more than one location, the term "establishment," for the purposes of Section 592.1, is to be defined in geographic terms, rather than in terms of corporate organization or exercise of management powers and functions. Thus, if there is a strike at the airport terminal building of an airline, the hangars at the airport (2½ miles distant) and the city offices (10 miles distant) are "separate" establishments; similarly, a steel fabrication plant, operated by a company engaged in erecting and installing steel structures at construction sites not contiguous to the plant, is a "separate" establishment so that a strike of the construction workers does not affect the workers employed at the fabrication plant.

MATTER OF FERRARA

This appeal - as well as those in three other cases also decided today - poses a novel question of law touching on an important aspect in the administration of the Unemployment Insurance Law, requiring us to determine the meaning of the term "establishment" as used in subdivision 1 of Section 592 (Labor Law, art. 18). Insofar as pertinent, that provision recites that "The accumulation of benefit rights by a claimant shall be suspended during a period of seven consecutive weeks beginning with the day after he lost his employment because of a strike, lockout, or other industrial controversy in the establishment in which he was employed."

The employer, National Airlines, Inc., operates an airline for the transportation of passengers, cargo and mail between New York and a number of cities in the South. Maintaining its principal office in Miami, it operates branch offices at each station on its route and, in the New York City area, at LaGuardia and Idlewild airports and several places in Manhattan. National also maintains a facility employing mechanics and cleaners at a hangar at the Idlewild Airports. The claimants in this case are the ticket agents, reservation clerks, and baggage clerks employed in Manhattan - all of whom are for convenience referred to as "clerks" - and the airplane mechanics and cleaners employed at the Idlewild hangar.

The clerks were represented by one union, the Airline Agents Association International, the hangar personnel by another and separate labor organization, the International Association of Machinists, AFL-CIO. The industrial controversy, involving only the Airline Agents Association and National, originated as follows: On April 1, 1957,the collective bargaining agreement between National and the Association expired. Negotiations for a renewal of the agreement were carried on over a period of several months but without success. On September 18 and 19, 1958, without authorization of the union, a number of the clerks employed in the Idlewild office discontinued or failed to report for work. Between September 20 and 22, other members of the Association employed at several of National's southern offices also stopped work.

During this brief period (from September 18 to September 23), however, National continued to operate its ticket office at Idlewild with supervisory personnel; its Manhattan ticket office, as well as the hangar at Idlewild, continued to operate with their regular personnel. On September 23, however, National discontinued all of its operations and, with certain exceptions not here relevant, furloughed all of its personnel, including the clerks in the Manhattan office and the Idlewild hangar employees.

Thereupon, the clerks at Idlewild, the instigators of the walkout, the clerks at Manhattan and the hangar employees filed their respective claims for unemployment compensation. Th Industrial Commissioner administratively denied benefits to all of the claimants for a seven-week period on the ground that an "industrial controversy" existed within the "establishment" of the employer within the meaning of section 592,subdivision 1. The Unemployment Insurance Referee and, thereafter, the Appeal Board overruled the Commissioner with respect to the Manhattan clerks. The Appellate Division modified the Board's decision by granting benefits not only to the Manhattan clerks but to the Idlewild mechanics and cleaners as well.

Before the suspension provision may be invoked under section 592, it must appear, first, that the claimant lost his employment "because of a strike, lockout or other industrial controversy" and, second, that such strike, lockout or other industrial controversy occurred "in the establishment in which he was employed."

As to the first element, the claimants employed at the Idlewild hangar and those employed at the Manhattan office seek to establish that their loss of employment did not take place "because of a strike, lockout, or other industrial controversy" involving the Idlewild clerks, but resulted rather from the employee stoppages at National's southern offices. It may not be disputed that the industrial controversy involved herein originated with the Idlewild clerks' refusal to work. Their continued absence from work was clearly a contributing factor in the ultimate layoff of claimants and, for purposes of this decision, it is unnecessary to determine whether the layoff of the claimants resulted solely from that walkout. At least one of the causes underlying the claimants' loss of employment was the industrial controversy involving the Idlewild clerks. The first element being established, we turn to a consideration of the second: are the Manhattan office and the Idlewild hangar facilities within the same "establishment" as the Idlewild office?

The appellants, although seeking to reverse the order of the Appellate Division, urge different grounds in support of their respective contentions. The Industrial Commissioner argues that the phrase "containing the word 'establishment' should be given a definition of sufficient breadth to include employees whose continuance at their jobs has become useless, or economically wasteful, while the strike lasts, and 'because of' it." The employer argues, in essence, that since the airline operations are of necessity integrated for the purpose of reserving and selling airline space and ultimately furnishing transportation, each "station" - that is, each metropolitan area in which the airline has facilities - constitutes a single establishment. As opposed to these contentions, the claimants maintain that the term "establishment" is to be construed in spatial or geographic terms.

To adopt that broad interpretation advanced by the Commissioner would obliterate the carefully delineated distinction which the statute seeks to draw between the phrase "in the establishment in which [the claimant] was employed" and the phrase "because of a strike." Under his construction, one or the other of the two tests for a suspension would become superfluous. Manifestly, therefore, the statutory language itself requires rejection of this interpretation.

The employer's argument that, since all operations within each station "operated as a single integrated unit," each station constituted a single establishment must also fail. Essentially, it is the contention which was advanced in Matter of Machcinski (Ford Motor Co.) (277 App. Div. 364, 643) and there rejected on the ground that the word "establishment" as used in the statute means the "place where the employee was last employed." In this case, too, the Appellate Division, in rejecting the contention and in concluding that the Manhattan office, the Idlewild office and the Idlewild hangar were separate establishments, reasoned that the Legislature "did not mean by 'establishment' the whole compass of a large employer's business institution where it operates in differently localized components. The word 'establishment' has strong local connotations."

Although the statute furnishes no definitive answer as to whether the term "establishment" is to be given an all-encompassing meaning equated with "enterprise" or a more limited spatial meaning equated with "place" and although the dictionary provides definitions which fit either alternative, it is clear that "establishment" is to be equated with place or situs. The Unemployment Insurance Law is a remedial statute designed to protect the wage earner from the hazards of unemployment by providing money benefits to individuals "unemployed trough no fault of their own" (Labor Law §501). Conversely, only claimants who are unemployed through fault of their own - such as employees who voluntarily quit their jobs or who refuse employment without good cause or who are discharged for misconduct - are denied benefits under the statute (§593 and §594).

Subdivision 1 of section 592, constituting the only exception to this statutory tenet, represents this State's reconciliation of the purposes of unemployment insurance with the principle of governmental neutrality, a principle which runs through all labor relations laws. In the interest of preserving that neutrality between a contesting employer and employees and irrespective of individual need, that provision withdraws benefits under certain limited circumstances there spelled out. The State must stand aside, at least during the early stages of an industrial controversy, and thereby avoid the imputation that a dispute may be financed through unemployment insurance benefits. (See Matter or Burger [Corsi], 277 App. Div. 234,236, affd. 303 N.Y. 654)). The exception, the suspension of benefits otherwise provided for, must be narrowly construed to effectuate the broad humanitarian objectives sought to be achieved by the statute. So read, it is evident that the term "establishment" is to be defined in geographic terms rather than in terms of corporate organization or exercise of management powers and functions.

This conclusion is confirmed by reference to the manifest design of the Legislature to provide a rule which may be expeditiously applied. Suspension under section 592 demands proof neither of industrial participation in, or financial aid to, the industrial controversy nor interest in its outcome. Suspension may, perhaps, be invoked even though claimants be separately represented for bargaining purposes. The administrator is thereby spared the need for making either complex or abstract administrative determinations which reference to individual involvement, participation or interest would require. Moreover, the geographic concept of "establishment," looking only to concrete facts, better fits the legislative purpose of simplicity of administration than does a concept which would require determinations regarding functional "interdependence," "integration" or "entity." Finally, apart from the fact that the term "establishment," defined in geographic terms, is more expeditiously interpreted and applied by the Industrial Commissioner, it is more easily understood by both employee and employer, the persons to whom it is to apply.

To construe "establishment" as denoting space or place is also more appropriate to the use of the term in other provisions of the statute. For instance, section 593, subdivision 2(b), providing that a claimant, who refuses employment "because of a strike, lockout, or other industrial controversy in the establishment" in which it is offered, shall be deemed to have refused employment for good cause and shall not be denied benefit rights. The broad definition of establishment sought by the employer in this case would, if applied to the last mentioned provision, enable employees to reject appropriate employment and still continue to draw unemployment benefits - a result obviously never intended.

In addition to the fact, already noted, that the Appellate Division previously decided that the term "establishment" is to be interpreted in the geographic rather than in the functional or managerial sense (see Mater of Machcinski [Ford Motor Co], 277 App. Div. 634, 643-644, supra; Matter of Lasher [Bethlehem Steel Co.], 279 App. div. 505,507), it is of some significance that the Legislature has resisted a number of attempts - first initiated shortly after the Machcinski decision - to amend the statute so as to extend the scope and content of the term "establishment" and the consequent suspension of benefits. (See, e.g., 1953, A. 1807, Pr. 1868; 1957, A. 3854, Pr. 3996; 1959; A. 3162, Pr. 3220; 1960; A. 2753, Pr. 2805; 1961, A. 2043, Pr. 2139).

Applying the principles set forth above to the facts in the case before us, there can be no doubt that the clerks in the Idlewild office and the mechanics in the Idlewild hangar, two and a half miles from the terminal building's ticket facilities, were not employed in the same establishment. And that, of course, is also true of the Manhattan clerks ten miles away. The fact that they belonged to the same union as the Idlewild clerks is without significance in view of the geographical connotation to be given the work "establishment." In other words, the industrial controversy involving the clerks at the airline's terminal office at Idlewild did not occur in the same establishment as that in which either the Idlewild mechanics and cleaners or the Manhattan clerks were employed.

The order of the Appellate Division should be affirmed. (May 25, 1961)

MATTER OF CURATALO

The claimant was employed in the steel fabrication plant of the F.L. Heughes Co. located in Rochester, New York. The company, in addition to operating the steel fabrication plant, was engaged in the business of erecting and installing steel structures at various construction sites in and around Rochester. None of these sites were contiguous to the fabrication plant. The employer also sold some of its steel production to third parties.

By reason of its operations, its employees fell into two separate categories; there were the steelworkers, of whom the claimant was one, who worked at the steel plant and there were the construction workers who worked at the various sites, installing the steel structures. Each group belonged to a different local of the International Association of Bridge, Structural and Ornamental Workers - the plant employees to Local 464, the construction workers to Local 33 - and each group operated under a separate and distinct collective bargaining agreement.

On June 16, 1958, Local 33 called a strike of construction workers, including all of the employer's construction workers, and picket lines were drawn around the employer's projects. There was no strike or picket line at the fabrication plant. Because of the employer's inability to deliver finished steel across the picket lines at the construction sites, there was a backing up of steel at the fabrication plant. A production cutback became necessary, and on July 25, approximately five weeks after the strike had begun, the employer laid off claimant and eleven other workers at the fabrication plant. The employer continued to operate the fabrication plant with approximately three fourths of the work force and to sell its fabricated steel to others.

The claimant was denied unemployment insurance benefits by the Industrial Commissioner on the ground that he had lost his employment because of an industrial controversy in the "establishment" where he had worked. The Unemployment Insurance Referee reversed the Commissioner's determination, finding that there was no strike in the claimant's establishment. The Appeal Board affirmed the Referee's determination, the Appellate Division unanimously affirmed the award and we granted leave so that we might have this case before us when we considered the other appeals involving the same general question (Matter of Ferrara v. Catherwood, supra, p. ; Matter of Wentworth v. Catherwood, infra, p. ; Matter of Gilmartin v. Catherwood, infra, p. ).

On the basis of our opinion in Matter Ferrara (supra, p. ) and the principles there enunciated, we conclude that the fabrication plant and the construction sites constituted separate establishments within the sense of section 592 of the Unemployment Insurance Law. It necessarily follows, therefore, that the strike at the sites did not occur in the establishment in which the claimant was employed.

The order of the Appellate Division should be affirmed. (May 25, 1961)

COMMENTS

The rule of this release reflects an important new direction in determining whether a single or separate establishments are involved. A careful study of the above two decisions is indicated so that local offices may determine the issue correctly. That sentence of the Court Decision deserves attention which points out that the "exception, that is, the suspension for benefits" must be narrowly construed to effectuate the broad humanitarian objectives sought to be achieved by the statute." However, there will be instances of doubt, due to the proximity of the employer's sites or because of other complicated situations. It is suggested that local offices request in such instances advice from the Interpretation and Review Section through regular channels.

A-750-1496

Index 1150A-5

NEW YORK STATE DEPARTMENT OF LABOR
UNEMPLOYMENT INSURANCE DIVISION
ADJUDICATION SERVICES OFFICE

JANUARY 6, 1959

INTERPRETATION SERVICE - BENEFIT CLAIMS
MISCONDUCT
Other Offenses

A.B. 67,034-58

MISCONDUCT, QUESTION OF - PERIOD OF EMPLOYMENT EXAGGERATED

"Puffing" the length of previous employment on an application in order to obtain a job does not constitute misconduct.

Referee's Decision: The referee sustained the initial determination of the local office disqualifying claimant from receiving benefits for seven consecutive weeks effective May 20, 1958 on the ground that he lost his employment through misconduct in connection with his employment.

Appealed By: Claimant.

Findings of Fact: Claimant is an electrician by trade. Because of his age his efforts to obtain employment in that field failed. Claimant as an alternative applied for a position as a maintenance man with a resident hotel located in midtown Manhattan. He was required to file an application for such job and indicate therein his previous work history. Claimant wanted the job desperately. He submitted a record of employment going back to 1933. In his over zealousness he exaggerated the period of his employment with a previous employer by indicating that he worked for such employer for a period of three years from 1953 to 1956, whereas in fact, he only worked there for about three months on two occasions in 1954 and 1956.

Claimant was hired on May 6, 1958. On May 19, 1958, after the employer discovered that claimant had exaggerated the length of his prior employment, he was discharged. Save for such untruth, claimant admittedly did not withhold any information which would be derogatory to him. Claimant's previous employers reported no unfavorable criticism wit respect to either his integrity or industry.

Claimant filed an application for benefits on May 23, 1958. Based on the facts recited above, the local office issued an initial determination disqualifying him from receiving benefits for seven consecutive weeks on the ground that he lost his employment through misconduct in connection with his employment.

Appeal Board Opinion and Decision: In sustaining the initial determination, the referee held that the furnishing of false information in connection with his application for employment constituted misconduct within the meaning of the Unemployment Insurance Law. In view of the particular facts and circumstances herein, we do not agree with the conclusion reached by the referee.

It is true that claimant exaggerated the extent of his previous employment in order to obtain a job. The representative of the employer who appeared at the hearing before the referee conceded that in discharging claimant his honesty was not impugned.

We do not question the employer's right to discharge claimant because it was displeased with claimant's conduct. However, since claimant's act was no for the purpose of concealing a questionable past, we believe that it did not constitute misconduct within the meaning of the Unemployment Insurance Law and did not warrant so serious a charge with such drastic consequences.

The initial determination of the local office disqualifying claimant from receiving benefits on the ground that he lost his employment through misconduct in connection with his employment is overruled. The decision of the referee is reversed. (December 17, 1958)