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Glover v. Simmons Co.

Decided: January 24, 1955.


On appeal from the Superior Court, Appellate Division, whose opinion is reported in 31 N.J. Super. 308.

For reversal -- Chief Justice Vanderbilt, and Justices Heher, Oliphant and Brennan. For affirmance -- Justices Wachenfeld, Burling and Jacobs. The opinion of the court was delivered by Oliphant, J. Burling, J. (dissenting). Mr. Justice Wachenfeld and Mr. Justice Jacobs authorize me to state that they join in the views expressed in this opinion.


[17 NJ Page 315] This is an appeal from a judgment of the Superior Court, Appellate Division, which affirmed a decision of the Board of Review of the Division of Employment Security awarding unemployment compensation benefits to the respondent, Glover, for the weeks ending July 12, 1953 and

July 19, 1953, in which period the plant of the appellant, Simmons Company, was shut down for a vacation period.

On February 13, 1953 Glover commenced his employment with the Simmons Company and designated the Upholsterers' International Union of North America, A.F. of L., as his representative for the purpose of collective bargaining. The union had consummated an agreement with the Simmons Company which provided for paid vacations of one week for employees with one to five years of service, of two weeks for those with five or more years, and of three weeks for those with at least 15 years; Art. VII, sec. 1 and 2 of the agreement. It was stipulated that those who were entitled to one week would take the vacation for 1953 during the week beginning July 6; those with two weeks would be off for two weeks beginning July 6; and those whose service qualified them for three weeks would take the first two during the same two weeks of July and the third at a time to be selected by the management. The plant shut down on July 6, 1953, solely for the two-week vacation period.

Glover, whose employment had started in February 1953, therefore was not qualified for a vacation with pay, and was notified that he was being laid off for two weeks.

The Board of Review in allowing benefits found as a fact that the respondent Glover was, during the period in question "able to work, available for work and has demonstrated that he was actively seeking work." R.S. 43:21-4(c). It likewise found as a fact that he was involuntarily unemployed. These findings were concurred in by the Appellate Division.

The Appellate Division stated that R.S. 43:21-15 expressly provides "Any agreement by an individual to waive, release, or commute his rights to benefits * * * shall be void," and that the Legislature had thus established the public policy of our State which could not be circumvented by any decision of the court or any agreement entered into in good faith between the employer and the labor union, and that the effect of this section is to remove the possibility of

waiver or the release of such benefits from the area of collective bargaining.

It further held that employees without right to vacation under a contract, such as this, are out of work through no fault of their own and therefore involuntarily unemployed and entitled to unemployment benefits.

Certification of this case was granted by this court under R.R. 1:10-2(d)(e).

The question presented is whether an employee, who was a member of a labor union which negotiated a collective bargaining agreement with an employer for vacation with pay after certain periods of service, and whose period of employment did not reach the minimum fixed by the contract to entitle him to vacation pay, is entitled to unemployment compensation when the plant is closed down for vacation period in accordance with the contract.

The question is one of novel impression in this State.

The appellant's argument is premised upon the contention that the statute provides unemployment compensation only in cases of involuntary unemployment and that respondent's unemployment was voluntary since he agreed to accept the vacation privilege of the collective bargaining agreement between the appellant and the union.

On the other hand, the argument made in favor of respondent is that the meaning of "voluntary unemployment" should be limited to idleness because the claimant will not work.

In view of the statutory provisions the question is not without some difficulty and the cases in other states are divided, though the weight of authority is with the appellant. Those that proceed under the theory of agency hold that the union contract providing for these vacations was in effect entered into by the employee through his representative union acting as his agent and that by taking an unpaid vacation the employee is voluntarily unemployed and thus not eligible for benefits. The following cases more or less follow that theory: Moen v. Director of Division of Employment Security,

324 Mass. 246, 85 N.E. 2 d 779, 8 A.L.R. 2 d 429 (Sup. Jud. Ct. 1949); Mattey v. Unemployment Compensation Board of Review, 164 Pa. Super. 36, 63 A. 2 d 429 (Super. Ct. 1949); Jackson v. Minneapolis-Honeywell Regulator Co., 234 Minn. 52, 47 N.W. 2 d 449 (Sup. Ct. 1951); Philco Corp. v. Unemployment Compensation Board of Review, 175 Pa. Super. 402, 105 A. 2 d 176 (Super. Ct. 1954).

Other courts have taken the view that an employee without a right to vacation pay under the contract is out of work through no fault of his own and therefore entitled to unemployment benefits. Schettino v. Administrator, Unemployment Compensation Act, 138 Conn. 253, 83 A. 2 d 217 (Sup. Ct. 1951); American Bridge Co. v. Review Board of Indiana Employment Security Division, 121 Ind. App. 576, 98 N.E. 2 d 193 (App. Ct. 1951).

However, the problem before this court is the construction of the statute in our own State, and we are confined to discovering the true intent ...

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