For affirmance -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. For reversal -- None.
In this unemployment compensation case the employer appealed to the Appellate Division from an adverse determination of the Board of Review, Division of Employment Security, Department of Labor and Industry, and we certified the appeal on our motion. The question involved is whether an employee who, on layoff for lack of work, receives a "lay-off allowance" equivalent to five weeks' wages under the terms of the collective bargaining agreement, is disqualified from receiving unemployment compensation benefits for the five weeks immediately following the layoff.
The Board of Review, Division of Employment Security, Department of Labor and Industry rendered the following decision:
"The employer filed a timely appeal from a decision of an appeal tribunal (ATJ-12891-Inv.) which held that the claimant was eligible for benefits from August 18 through September 14, 1958, under a valid claim filed August 18, 1958; that he was ineligible from September 15 through November 13, 1958, eligible from November 14 through December 11, 1958, and ineligible thereafter through January 7, 1959.
The claimant and the employer appeared by counsel at hearings conducted on May 21 and June 5, 1959.
Counsel for the parties agreed that there was no basic dispute as to the facts found by the Appeal Tribunal. Those were simply that the claimant had been employed as a central office equipment installer by Western Electric Co., Inc., for more than five years; that his last wage was $97 a week; that his last day of employment before this claim was filed was August 15, 1958; and that he was laid off on that date, for an indefinite period, because of lack of work. The employer reported the lay-off as 'permanent' but subsequently its witnesses testified that such description was erroneous, as the claimant retained seniority rights for two years after lay-off, in accordance with the terms of the collective-bargaining agreement in force at the employer's premises. At the time of lay-off, the claimant received a lump sum payment of $484, less normal deductions. That payment represented the equivalent of five weeks' pay through September 19, 1958, paid him in accordance with the terms of the bargaining agreement.
The bargaining agreement in question is that which had been entered into by Western Electric Co., Inc., and the claimant's union, The Communication Workers of America.
That agreement, in Article XXI, provides as follows:
1. Schedule of Allowances
Employees Laid-off shall be granted a Layoff allowance based on Term of Employment at date of such Layoff, in accordance with the following schedule, except as provided in Paragraph 3 below:'
The agreement then sets up a schedule of payments to be made at the time of layoff which provides for one week's pay for each completed year of service through the seventh year of service, and for two weeks' pay for the eighth and subsequent years of service through the fourteenth year. Thereafter, three weeks of pay is allowed for each additional completed year of service.
'2. Computation of Allowance Payments
2.1 Layoff allowance payments shall be based on the employee's established schedule of working hours or days (excluding overtime) in effect as of the date of Layoff, with a minimum of thirty-two (32) hours per week. For individual Employees whose standard schedule are less than the thirty-two (32) minimum mentioned above, the allowance shall be based on their standard schedule. The rate of pay used in such computations shall be the Employee's standard hourly rate plus night work bonus when applicable.
2.11 When An Employee's standard hourly rate has been reduced and the effective date of such reduction falls within the twenty-six (26) week period preceding Layoff, the standard hourly rate used shall be that in effect immediately preceding the reduction from the higher standard hourly rate which was effective within such twenty-six (26) week period if it is higher than the standard hourly rate in effect as of the date of Layoff.
3. Schedule of Allowance for Reemployed Employees
An Employee who has been reemployed following a period of Layoff and who is again Laid-off, shall be granted a Layoff allowance in accordance with the following:
Continuous Service Since Date ...