Sinai Hospital of Baltimore, Inc. v. Department of Employment & Training

ADKINS, Judge. We are asked to decide 1. Whether striking workers, permanently replaced during the strike, are disqualified from receiving unemployment compensation benefits under Art. 95A, § 6(a) of the Code on the ground that they have left their employment voluntarily without good cause; and 2. Whether those workers are disqualified under § 6(d) because they refused their employer’s offer to return to their pre-strike jobs, although the job offer was made before the workers had filed claims for unemployment compensation.

A special examiner of the appellee Department of Employment and Training (DET), that department’s Board of Appeals, and the Circuit Court for Baltimore City, all concluded that the workers were not disqualified. We agree and affirm the judgment of the circuit court. Facts On 1 December 1984 the collective bargaining agreement between appellant, Sinai Hospital of Baltimore, Inc. (Sinai), and District 1199E, National Union of Hospital and Health Care Employees, RWDSU, AFL-CIO (the Union), expired ³² according to its terms. The expiration was preceded by a series of negotiations between Sinai and the Union and also by a 23 November notice from the Union to Sinai that the former intended to call a strike on 4 December.

Sinai responded by sending notices to its employee Union members telling them, among other things, that if they honored the call to strike, they could be permanently replaced. Among those to whom this information was sent were the approximately 43 individual appellees (Claimants) who are parties to this appeal. The strike began on 4 December. The next day Sinai sent mailgrams to all strikers, including the Claimants, advising that their current jobs were available, and requesting them to return to those jobs “immediately.” The strikers were warned “[i]f you do not return, you will not be eligible for unemployment benefits under Maryland law.” On 7 December Sinai sent notices to the strikers, including the Claimants, that on 11 December it would “begin to hire permanent replacements for strikers who have not returned to work by that date.” These notices further explained: “A permanent replacement hired to do your job will not be fired to permit you to return to work.

You will not be able to use your seniority to bump your replacement, either. “If there is a vacant job, you and other strikers will be considered for it, if qualified. If there is no vacant job you can do, you will not be able to return to work at Sinai.” None of the Claimants accepted this invitation. By noon on 11 December all of them were permanently replaced. The strike ended late that same day when the Union ratified a new contract with Sinai.

During the brief strike, Sinai continued to operate; there was no “stoppage of work” within the meaning of Art. 95A, § 6(e). After the termination of the strike, the Claimants, .then without jobs, filed for unemployment compensation benefits. Sinai opposed their claims, contending that they had voluntarily quit their jobs, thus producing a disqualification ³³ under § 6(a), and that they had refused an offer of suitable employment, thus producing a disqualification under § 6(d). When those arguments were rejected, first administratively and then judicially, Sinai renewed them here, after we issued a writ of certiorari while the case was pending in the Court of Special Appeals. 307 Md. 754 , 517 A.2d 102 (1986).

Voluntarily Leaving Work—Art. 95A, § 6(a) Article 95A, § 6 in pertinent part provides: “An individual shall be disqualified for benefits: (a) If the [Secretary 1 ] finds that the individual’s unemployment is due to his leaving work voluntarily without good cause. Only a cause which is directly attributable to, arising from, or connected with the conditions of employment or actions of the employer may be considered good cause. The individual’s disqualification shall be effective for the week in which the unemployment began and shall continue (1) for not less than 4 nor more than 9 weeks immediately thereafter, according to the seriousness of valid circumstances as determined in each case by the [Secretary] or (2) until the individual has become reemployed and has earnings in insured work equal to at least ten times his weekly benefit amount. Leaving work to become self-employed, to accompany or join one’s spouse in a new locality, or to attend an educational institution is neither good cause nor a valid circumstance for voluntarily leaving work.

Only a substantial cause which is directly attributable to, arising from, or connected with the conditions of employment or actions of the employer, or another cause of such a necessitous or compelling nature that the individual had no reasonable ³⁴ alternative other than to leave the employment may be considered a valid circumstance____” Sinai asserts that subsection (a) disqualifies the Claimants because when they did not return to work after being warned they would be permanently replaced (and thus lose their jobs), they voluntarily terminated their employment with the hospital. It argues that the Claimants abandoned their employment by pursuing a course of conduct which resulted in the severance of them from their employment—a constructive voluntary leaving. Whether the doctrine of constructive voluntary leaving is recognized in Maryland has not been decided by this Court. In Allen v. Core City Target Y. Program, 275 Md. 69, 82-83 , 338 A.2d 237, 245-246 (1975), we assumed the doctrine might be “applicable under appropriate circumstances” but held that the facts in that case did “not bring it within that doctrine.” Nor did we adopt the doctrine in Md. Emp.

Sec. Bd. v. Poorbaugh, 195 Md. 197 , 72 A.2d 753 (1950). There the claimant left his job because he did not like working in cold weather, and failed to return for some four months after the employer had invited him to do so or face loss of his job. We held, under those circumstances, that Poorbaugh had voluntarily left work without good cause. In any event, the facts in both Allen and Poorbaugh are totally different from those before us here— most notably because neither of those cases involved a labor dispute.

In Allen , we concluded that the phrase “due to leaving work voluntarily” has “a plain, definite and sensible meaning, free of ambiguity; it expresses a clear legislative intent that to disqualify a claimant from benefits the evidence must establish that the claimant, by his or her own choice, intentionally, of his or her own free will, terminated the employment.” 275 Md. at 79 , 338 A.2d at 243 . Quoting from Webster’s New International Dictionary of the English Language (2d ed. 1974), Black’s Law Dictionary (Rev. 4th ed. 1968), and Webster’s Seventh New Collegiate Dictio ³⁵ nary (1967), respectively, we noted that “voluntary” is defined as: “1. Proceeding from the will, or from one’s own choice or full consent; produced in or by an act of choice____ 2. Unconstrained by interference, unimpelled by another’s influence; spontaneous; acting of oneself; free____ 3.a.

Done by design or intention; intentional; purposed; intended, not accidental ... b. Made or given of one’s own free will____” * * * * * * “Done by design or intention, intentional, purposed, intended or not accidental ... intentionally and without coercion.” Jjc :js $ :f: “[Done] of one’s own free will.” We note that in this case the special referee found as a fact (and this factual finding was accepted by the Board of Appeals) that “at the time the claimants separated from their employment they did not do so with any intention other than to obtain a satisfactory collective bargaining agreement.” Indeed, many courts have indicated that a labor dispute does not produce the kind of severance of the employment relationship that is contemplated by the “voluntary leaving” provision of subsection (a). As the Supreme Court of Hawaii reasoned: “... [T]he terms ‘leaving work’ or ‘left his work’ as used in unemployment compensation laws refer only to a severance of the employment relation and do not include a temporary interruption in the performance of services. Kempfer, Disqualification for Voluntary Leaving and Misconduct, 55 Yale Law Journal 147, 154.

Absence from the job is not a leaving of work where the worker intends merely a temporary interruption in the employment and not a severance of the employment relation. Such is the case of strikers who have temporarily interrupted their employment because of a labor dispute. Under the prevailing view, they have not been deemed to ³⁶ have terminated the employment relationship and the voluntary leaving disqualification has no application to them.” Inter-Island, Resorts, Ltd. v. Akahane, 46 Haw. 140, 158 , 377 P.2d 715, 725 (1962) (permanently replaced strikers not disqualified from benefits). See also T.R. Miller Mill Company v. Johns, 261 Ala. 615 , 75 So.2d 675, 680 (1954); Mark Hopkins, Inc. v. Cal.

Emp. Comm., 24 Cal.2d 744, 748-749 , 151 P.2d 229, 231 (1944); Coates v. Bingham Mechanical & Metal Products, Inc., 96 Idaho 606, 607 , 533 P.2d 595, 596 (1975); Knight-Morley Corp. v. Mich. Emp. Sec. Comm., 352 Mich. 331, 336 , 89 N.W.2d 541, 544 (1958); Producer's Produce Co. v. Indust.

Comm., 365 Mo. 996 , 291 S.W.2d 166, 177 (1956); Penflex, Inc. v. Bryson, 506 Pa. 274, 287-288 , 485 A.2d 359, 365-366 (1984); Trapeni v. Dept. of Emp. Sec., 142 Vt. 317, 324-325 , 455 A.2d 329, 333 (1982); Standard Materials, Inc. v. Admn’r, Div. of Emp. Sec., 401 So.2d 400, 401 (La.App.1981); Tri-State Motor Transit Co. v. Indust. Comm., 509 S.W.2d 217, 220 (Mo.App.1974); and Norris v. Texas Employment Comm., 688 S.W.2d 125, 128 (Tex.Ct.App.1985) (all but Coates, Trapeni, and Norris involving permanently replaced strikers).

But see Baughman v. Jarl Extrusions, Inc., 648 S.W.2d 954 (Tenn.App.1982). The reasoning of these cases is straightforward. In an economic strike, strikers do not intend to sever the employment relationship; they intend just the opposite. By striking they hope to achieve improvements in pay, benefits, or other working conditions—improvements that will accrue to their advantage when they return to work.

As a federal judge put it long ago: “A strike is cessation of work by employees in an effort to get for the employees more desirable terms. A lock out is a cessation of the furnishing of work to employees in an effort to get for the employer more desirable terms. Neither strike nor lock out completely terminates, when this is its purpose, the relationship between the parties. The employees who remain to take part in the strike or ³⁷ weather the lock out do so that they may be ready to go to work again on terms to which they shall agree—the employer remaining ready to take them back on terms to which he shall agree.

Manifestly, then, pending a strike or a lock out, and as to those who have not finally and in good faith abandoned it, a relationship exists between employer and employee that is neither that of the general relation of employer and employee, nor again that of employer looking among strangers for employees, or employees seeking from strangers employment.” Iron Molders’ Union v. Allis-Chalmers Co., 166 F. 45, 52-53 (7th Cir.1908) (Grosscup, J., concurring). See also Fierst and Spector, Unemployment Compensation in Labor Disputes, 49 Yale L.J., 461 , 464 (1940). What is more, a number of courts have concluded or indicated that permanently replaced strikers have in effect been discharged from employment, as opposed to having left work voluntarily. This is so even when the replacement follows a notice like that sent by Sinai in this case.

In such circumstances the severance of the employment relationship is the result of an affirmative act by the employer. See, e.g., Ruberoid Co. v. Cal. Unempl. Ins.

App. Bd., 59 Cal.2d 73 , 27 Cal.Rptr. 878 , 378 P.2d 102 (1963); Marathon Elec. Mfg. Co. v. Indust. Comm., 269 Wis. 394 , 69 N.W.2d 573 (1955); Building Products Co. v. Ariz.

Dept. of Econ. Sec., 124 Ariz. 437 , 604 P.2d 1148 (Ariz.Ct.App.1980). See also Knight-Morley Corp. v. Mich. Em.

Sec. Comm.; Producers Produce Co. v. Indust. Comm.; Penflex, Inc. v. Bryson; and Tri-State Motor Transit Co. v. Indust. Comm., all supra. But we need not decide the constructive voluntary leaving issue; that is, whether the special examiner’s intent finding was supported by evidence.

Nor need we determine whether Sinai’s replacement of Claimants was tantamount to their discharge, as the circuit court decided. There is another and more fundamental reason why Claimants are not disqualified under subsection (a). It is that subsections (a) and (e) are mutually exclusive. The examiner and the ³⁸ Board of Appeals both so held as a matter of law, and we believe they were correct.

Subject to exceptions not applicable here, § 6(e) disqualifies a claimant “[f]or any week with respect to which the [Secretary] finds that his unemployment is due to a stoppage of work, other than a lockout, which exists because of a labor dispute at the factory, establishment, or other premises at which he is or was last employed____” This subsection was before us in Employment Security Administration v. Browning-Ferris Industries, 292 Md. 515 , 438 A.2d 1356 (1982), in which the specific question presented was the meaning of the phrase “stoppage of work.” Browning-Ferris, the employer, contended that “stoppage of work” referred to cessation of productive activity by employees; since its employees were on strike, it thought that a disqualifying stoppage had occurred. We disagreed, holding that “the phrase ‘stoppage of work’ in § 6(e) refers to the curtailment of the employer’s operations.” 292 Md. at 524 , 438 A.2d at 1362 . We then turned to Browning-Ferris’s contention “that § 2 of [Art. 95A] creates a general voluntariness disqualification which is incorporated into § 6(e), and which compels the conclusion that employees who voluntarily stop work to participate in a strike are ineligible for unemployment benefits.” 2 Id. at 525, 438 A.2d at 1362 . In rejecting that ³⁹ contention, Chief Judge Murphy noted for the Court “that § 2 does not create any general disqualification based on fault.” Id.

See also MEMCO v. Maryland Employ. Sec. Adm., 280 Md. 536, 548 , 375 A.2d 1086, 1093 (1977). He explained that “[t]o hold otherwise would require us to pass on the merits of each labor dispute in which the participants sought unemployment benefits—a palpable violation of one of the fundamental tenets of the unemployment compensation law, i.e., that the administering agency remain neutral in labor disputes and refrain from passing on the merits of the dispute.” Browning-Ferris, 292 Md. at 525-526 , 438 A.2d at 1362 [footnote omitted]. Observing that the only labor dispute disqualification mentioned in § 6(e) is the “stoppage of work” requirement, he concluded that “[t]he particular intent of § 6(e), viz., to disqualify claimants only where there is a stoppage of the employer’s operations (other than a lockout) must, therefore, control over the general intent of § 2.” Id. at 526, 438 A.2d at 1363 .

Elaborating on this theme, Chief Judge Murphy went on to opine that Browning-Ferris’s § 2 argument “would render the ‘voluntarily leaving work’ provision of § 6(a) superfluous.” And he noted that “[t]he consensus of states which have interpreted the ‘voluntarily leaving work’ and ‘labor dispute disqualification’ provisions have held that they are mutually exclusive,” supporting this statement by quotation from Inter-Island Resorts v. Akahane, and citation to numerous other cases. Browning-Ferris, 292 Md. at 526-527 , 438 A.2d at 1363 . The question of whether § 6(a) and § 6(e) are mutually exclusive is now squarely presented to us. We are, of course, dealing with a question of legislative intent.

We should first attempt to ascertain that ⁴⁰ intent from the statutory language, reading pertinent parts of the legislative language together, giving