THOMAS v. CALIFORNIA EMPLOYMENT STABILIZATION COMMISSION et al.
Respondent Thomas and 194 other employees of appellant Pacific lumber Company applied under the Unemployment Insurance Act (Stats.1935, p. 1226, as amended; 3 Deering's General Laws, (1944), Act 8780d) for unemployment benefits, and upon a denial thereof filed a mandate proceeding in the Superior Court to compel such payments. They prevailed therein and these appeals were taken by the Company, the Commission, and the Appeals Board.
In January, 1946, a labor dispute existed between the Company and its woods employees. The woodsmen struck, and set up a picket line around the Company's saw-mill plant at Scotia, California. There was no dispute between the Company and its mill employees, but many of them, including the 195 claimants, refused to go through the picket line and some of the 195 joined in the picketing. On January 17 the mill closed down for lack of sufficient key men to run it, and it remained idle for a long time.
The 195 mill employees filed claims with the Commission's office in Eureka for unemployment benefits, which initially were denied, but later, on reconsideration, granted by that office. The Company appealed and on April 17, 1946, there was a hearing before a Referee, who decided that the claims should be allowed except for the period January 14–17. An appeal from that decision was taken to the Appeals Board, which filed a written opinion, two members joining, holding that no benefits were allowable; the other member filed a dissenting opinion.
The mandate case was presented in the Superior Court on the record as made before the Referee without any additional evidence. The court held that it was authorized by law to exercise its independent judgment on the evidence (§ 1094.5 Code Civ.Proc.) and arrived at a conclusion contrary to that of the Appeals Board but consonant with (a) the final ruling of the Commission's Eureka representative, (b) the opinion of the Referee, and (c) the opinion of the dissenting member of the Appeals Board.
Section 56 of the act reads: ‘An individual is not eligible for benefits for unemployment, and no such benefit shall be payable to him under any of the following conditions: (a) If he left his work because of a trade dispute and for the period during which he continues out of work by reason of the fact that the trade dispute is still in active progress in the establishment in which he was employed. * * *’
As in the Matson case (Matson Terminals v. California Employment Comm.) see 24 Cal.2d 695, 703, 151 P.2d 202, 206, the ‘claimants in the present case refused to work for the same reason that the claimants in the Bodinson case [Bodinson Mfg. Co. v. California Employment Comm., 17 Cal.2d 321, 109 P.2d 935] refused to work’, not because they were on strike, but because they would not cross the picket line set up by an affiliated union. In that situation their employer-employee relationship was suspended but not terminated. Mark Hopkins case (Mark Hopkins, Inc., v. California Employment Comm.), 24 Cal.2d 744, 749, 151 P.2d 229.
On the initial application of the 195 claimants for unemployment benefits the Commission's Eureka representative ruled against them under § 56(a), and, had the situation remained as it was the Bodinson case, 17 Cal.2d 321, 109 P.2d 935 and the Matson case, 24 Cal.2d 695, 151 P.2d 202, supra, would have foreclosed all debate, and there probably would have been no court proceeding. But it did not remain static, for on or about January 18, a day or so after the mill shut down, the Company delivered to each of the 195 men a pink slip, filled out appropriately as to each, reading as follows:
‘The Pacific Lumber Company
‘The Employee must present this slip to the Employment Office at Scotia within two days from date of issue.
Date Last Worked ........
No. Hours ...
Date Terminated ........
Employee's Signature ........'
Each of these notices was accompanied by an Internal Revenue Department form stating the wages paid to the employee in January, 1946 (roughly from the 1st or 2nd to the 12th) and the income tax, if any, withheld at the source. The Income Tax Act requires such forms to be supplied to the employee-taxpayer before January 31 of the next year after the calendar year (which would mean on or before January 31, 1947) if the employee remains at work throughout the calendar year, but ‘if his employment is terminated before the close of such calendar year, on the day on which the last payment of wages is made’ (U.S.C.A. Title 26, § 1625).
After the 195 claimants filed their initial applications the Eureka representative of the Commission was in touch with the Company's auditor, and received from him the following letter dated January 24:
‘With reference to your telephone conversation this morning and yesterday evening with reference to the Continuous Service Compensation which this Company has had in effect since June 15, 1918, I am enclosing one of the booklets, No. 4075.
‘You will note that inside the booklet there is a receipt which the employee signs when receiving the booklet and as each employee is hired, he is given one of these books and the signature taken on the card. On page 5, you will note that I have made marks with reference to the 3 day period.
‘Ever since the inception of this compensation plan it has been our practice to terminate a man who has not complied with those provisions. In the case of these men who just left here for which we have issued terminations, it is in accordance with our past practice. The men who left here and for which we gave them terminations, are those who refused to go through the picket line the first morning of the strike.’
On the strength of this letter the Commission's Eureka representative reversed the ruling which she had made on the initial applications and held that the termination notices had effected a clear-cut severance of the employer-employee relationships, had removed the disability theretofore existing under § 56(a), and had left the 195 claimants unemployed persons within the purview of the Act.
The plan spoken of in the auditor's letter was designed, of course, as an incentive to steady, continuous work. For the first year of employment the Company would credit the employee with 3% of his total compensation as a bonus, and the rate would increase 1% each year until the maximum of 7% was reached. If, however, the employee absented himself for more than 3 days without written permission he would, on re-employment, revert to the beginner's 3% rate.
A section in the book of rules reads as follows: ‘Any employee who is absent from work in excess of three days without a written permit shall be dropped from the Company's payroll and employment period terminated.’
One of the concluding paragraphs in the book reads: ‘Remember—If your Continuous Service is broken, you must start again as a new employee.’
It has been the Company's position throughout this controversy that the pink slips, although labeled ‘Employment Termination’—and so characterized by the Company's auditor in his January 24 letter—were given, not to sever the employer-employee relationship, but merely to cut off whatever higher percentage the employee had reached under the bonus plan, so that when he returned to work after the strike he would do so under the 3% rate, the same as a beginner.
This position was clearly developed before the Referee by a witness for the Company, and the Referee's immediate reaction appears just as clearly from the following colloquy. The witness for the Company when asked by the Company's counsel, ‘Did this form of notice serve more than one purpose for your company?’ answered ‘Yes * * * This form of notice served a dual purpose. It is a form we use in case a man was discharged and it is the form we use in case a man quits and it is also the form used in case a man breaks his continuous service by being absent from work in excess of three days without written permission.’
That answer showed a triple, not a dual, purpose.
Later the same witness testified that the notices were not ‘intended by the company to teminate the employer-employee relationship’ but ‘to terminate the continuous employment period under the continuous bonus plan.’ The Referee then made it perfectly clear that as far as he was concerned ‘the documents speak for themselves', adding, ‘I am going to consider the document itself as it is worded by the company and any attempt to place another meaning thereon, one which is implied by the company's intention, I'll have to disregard * * * Any witness that testifies as to what he thought the document meant won't guide me.’ The Referee's written opinion shows that he adhered to this view.
It is the contention of the 195 claimants that the pink slip unequivocally discharged them from the Company's service on or about January 18, 1946, irrespective of their status during the preceding four days, and that thenceforth they were not merely suspended employees, see Mark Hopkins case, 24 Cal.2d 744, 749, 151 P.2d 229, supra, but discharged employees, purged of all ineligibility under § 56(a).
At the same time that the Company sent the ‘Employment Termination’ notices to the 195 claimants it sent to its employees who had not absented themselves for more than 3 days without written permission the following notice dated January 18:
‘The Pacific Lumber Company
Leave of absence permit
Scotia, California ..... 194 .
No. ... is granted leave of absence for a period of ... days from..... 194 . To Resumption of Operations.
Your Hospital dues are paid to ..... If you wish to protect your membership during this Leave of Absence, please pay dues in advance to Cashier at Scotia Office.
The Pacific Lumber Company
Thus it appears that some employees received ‘Employment Terminations' while others got leaves of absence until ‘resumption of operations.’
On January 21 the Company sent to the men who were out, including the 195 claimants, the following——
‘All Employees and former Employees not working because of the strike or strike conditions are requested and urged to return to work immediately or as soon as such conditions cease to exist.
‘Failure to comply with this request may result in other persons being employed in your place.
The Pacific Lumber Company'
The following statement of additional facts is quoted from the Appeals Board's decision:
‘A representative of the employer testified that an employee who returned to work after an unexcused absence in excess of three days did so at the beginning bonus rate of three per cent and thereafter worked towards the maximum in the same manner as a new employee. Similarly, vacations with pay were granted only to workers who had been ‘continuously employed’ for various periods. Upon reporting back to work after an unexcused absence in excess of three consecutive days, employees were required to clear through the employer's personnel department and obtain a note directing a foreman to put the individual back to work. An employee who returned to work under such circumstances was not necessarily returned to his former duties as a matter of right but rather, his duties upon return were discretionary with the employer. A representative of the employer's personnel department testified that in actual practice, the employee usually went back to his same work. Two claimants testified that when they returned after an extended absence on prior occasions they were returned to their old duties.
‘The employer also had in effect an employee pension or annuity plan, the essential factor of which was a contribution by payroll deduction, made by the employee, plus a contribution, by the employer. During the period shortly after January 14, 1946, a great many employees withdrew their accumulated contributions, plus interest, as they were entitled to do. These withdrawals were sufficiently substantial to cause some apprehension as to their ultimate effect on the plan and, after negotiations with the insurance carrier, arrangements were made for the employer to advance the employee's share of the premium for the period of the shutdown. The employee was to repay this advance in installments following his return to work. All employees were notified of this arrangement by a letter from the employer dated February 18, 1946, which letter was accompanied by a card which the employee was to sign and return if he desired to authorize the employer to advance the premiums for him. The claimants herein were among those so notified and some of the claimants signed and returned the card authorizing the employer to advance their premiums.
‘The employer also maintained a hospitalization plan pursuant to which participating employees paid $1.50 per month by payroll deductions. For a brief period following the shutdown, some of the claimants offered to advance the amount of their hospitalization dues, which offers were not immediately accepted by the employer. The claimants were advised, however, to return later for further information relative to the hospital plan. In a letter dated February 18, 1946, the employer notified all employees who were participants in the hospitalization plan that their participation could be continued by payment of dues in advance and some claimants have paid their dues in this manner.
The foregoing is a summary of the principal facts. Some minor circumstances will be stated later, in the discussion of the scope of the mandate proceeding.
The Appeals Board filed a carefully prepared opinion and we deem it proper, in the interest of a complete presentation of the problem, to append in a footnote1 that part of it which gives the ‘Reason for Decision’, omitting their statement of facts.
As already appears, the trial judge held in his written opinion and findings that the court was authorized to exercise its independent judgment on the evidence. The Company in its opening brief (which the other appellants adopt) states the appellants' position as follows:
‘Petitioner [respondent] contends that in a mandate proceeding under section 1094.5 * * * to review a determination of the Unemployment Insurance Appeals Board, the court may exercise its independent judgment on all the evidence. The court below took that view. We contend that the court is limited to the question whether there is substantial evidence to support the determination of the Board. This first issue, therefore, is one of interpretation of section 1094.5 as applied in a case coming up from the Unemployment Insurance Appeals Board.’
Section 1094.5 enacted in 1945, now reads in part as follows: ‘(c) Where it is claimed that the findings are not supported by the evidence, in cases in which the court is authorized by law to exercise its independent judgment on the evidence, abuse of discretion is established if the court determines that the findings are not supported by the weight of the evidence; and in all other cases abuse of discretion is established if the court determines that the findings are not supported by substantial evidence in the light of the whole record.’
The only provisions of the Act which deal with judicial action following an administrative decision are §§ 45.10[45.11d] and 82. The latter section, added in 1943, sheds no light whatever on the scope or character of the court review. It simply says: ‘* * * The decision of the appeals board is final, except for such action as may be taken by judicial tribunal as permitted or required by law.’
Respondent contends that this case is within the rule of the revocation and suspension of license or permit cases while appellants contend that it is within the rule of the denial of license or permit cases. There seems to be no reason to place it in either category since the statute is unique and in a class by itself.
No case in our appellate courts has dealt with the question now presented.
We are satisfied that in a mandate proceeding such as this the trial court has, as the judge held, the authority to exercise an independent judgment and to weigh the evidence, for the following reasons.
Whatever rights a wage-earner has to unemployment benefits are created by statute. It is not necessary to hold that they are vested rights or property rights in order to decide the question. The declaration of policy contained in § 1 of the Act is that the general welfare requires the ‘compulsory setting aside of the funds to be used for a system of unemployment insurance providing benefits for persons unemployed through no fault of their own, and to reduce involuntary unemployment and the suffering caused thereby to a minimum.’ If this is unemployment insurance, then the wage-earner's compulsory contribution is in the nature of an insurance premium. The percentage of his wages deducted from his pay-check for the insurance fund gives him a ‘stake’ therein. He gives a quid pro quo for what he gets in time of need. When out of work he is not in the position of one who seeks mere relief, which is a gratuity. The wage-earner has a pecuniary interest in the fund in the nature of a contractual right, analogous to such a right as arises from the payment of premiums on an everyday life, health or accident insurance contract.
There is another reason why the Superior Court should exercise its independent judgment on the evidence in cases such as this. Section 45.10 [45.11d] of the Act gives the right to an employer (after first paying his contribution or tax under protest) to ‘bring an action against the commission in any court of competent jurisdiction * * * for the recovery of contributions so paid under protest.’ In such an action the employer gets a full trial before a court which exercises its independent judgment on the evidence, and makes findings of fact and conclusions of law thereon. If a wage-earner, deprived of unemployment benefits by the ruling of an administrative agency, had only a right to a limited court review, there would be an inequality of remedy as between employer and employee.
The Appeals Board based its decision on three main propositions. They said: ‘That a befinite end of the employment relationship was not contemplated is substantiated by the employer's arrangements to continue, on behalf of the claimants, the latter's contributions to a pension fund and the agreement whereby the claimants could retain their membership in the employer's hospitalization plan.’
The Board's statement of facts, quoted earlier, shows that all employees were notified of this pension arrangement by the Company's letter of February 18, but that was a full month after the shut-down. ‘The claimants herein’, the Board said, ‘were among those so notified and some of the claimants signed and returned the card authorizing the employer to advance their premiums.’ (Emphasis added). So, also, as to the opportunity offered by the Company's letter of February 18 to come under the hospital plan. The Board said ‘and some claimants have paid their dues in this manner.’ (Emphasis added). The Board's language ‘some of the claimants' was neither loose nor careless. The testimony of the Company's witness was substantially that, and nothing more. The exact number of claimants who accepted could readily have been proved since the pension and hospital figures were known to the Company (and not to the claimants). If 195 claimants, or a fair percentage of them, embraced these opportunities such a showing might have tended to some degree to substantiate the Company's contention. As it was, the testimony that some of the 195 answered, was to say the least not convincing. The court, perhaps with § 1963, subd. 6, Code Civ.Proc. in mind, apparently gave little weight, if any to it.
The Board also said in its decision: ‘We also have in the record before us the employer's offer of January 21, 1946, urging the claimants to return to work immediately or as soon as strike conditions ceased to exist.’
The form of this communication was entirely consistent with a severance of the employer-employee relationship of the 195 men since it was addressed to ‘All Employees and former Employees not working because of the strike or strike conditions * * *.’ (Emphasis added.) In deed it might well have been treated, in the weighing process, as tending to show that the ‘former employees' had been unequivocally discharged.
The Board in its decision said: ‘There is credible evidence before us that the employer, in accordance with a long established rule, intended that the ‘Employment Termination’ notice was to affect only the claimant's rights in the employer's bonus plan and to accrued vacation privileges.'
The Referee did everything but strike from the record the testimony that the notices were not ‘intended by the company to terminate the employer-employee relationship’ and it is clear that the court attached no more weight to it than did the Referee.
The court found: ‘8. That said ‘Employment Termination’ pink slip had been, and was used continuously by respondent Company for a great number of years prior to January 18, 1946, as its form used in notifying an employee of his discharge; that said ‘Employment Termination’ forms were used by respondent Company on January 18, 1946, to discharge and terminate the employment of each and all claimants herein.'
‘13. That it is not true that respondent Company, in its acts and conduct toward claimants herein, merely terminated claimant's rights to benefits under its Continuous Service Compensation Plan.’
The following documentary evidence indicates that the 195 claimants were unequivocally discharged: The section of the rule book, printed long before the controversy, reads: ‘Any employee who is absent from work in excess of three days without a written permit shall be dropped from the Company's payroll and employment period terminated.’ (Emphasis added.) The same book says: ‘Remember—If your Continuous Service is broken, you must start again as a new employee.’ (Emphasis added.) The last paragraph of the auditor's letter of January 24 reads: ‘Ever since the inception of this compensation plan it has been our practice to terminate a man who has not complied with those provisions. In the case of these men who just left here for which we have issued terminations, it is in accordance with our past practice. The men who left here and for which we gave them terminations, are those who refused to go through the picket line the first morning of the strike.’ (Emphasis added.) Termination is spoken of thrice. The whole paragraph is susceptible of the meaning that ‘The men who left here’ were given ‘terminations' because they refused to go through the picket line. The pink slip itself, already quoted, is absolutely unambiguous.
The following additional facts argue for an outright discharge (a) the delivery to the men of the Internal Revenue withhold statements with their terminal paychecks; (b) that the usual hospital dues were not deducted from the terminal pay-checks; (c) that it was not necessary for the Company to serve any notice at all under its Continuous Service Bonus Plan since the rules were clear as to the consequences, and the shut-down itself was so open and notorious that no ‘paper’ record of absence was required, further, the record shows that oft-times no such notices were given; (d) and perhaps most potent of all, that the Company was under no duty to reemploy anybody, and whether it did, or not, was entirely in its hands; (e) that leaves of absence were given to some, terminations to others. The evidence just recapitulated, much of which is documentary, leaves no doubt that the clear preponderance was on the side of an unequivocal discharge. In the last analysis all there is to be weighed against it is the testimony respecting the Company's intention, which the trial judge held to be of insufficient legal consequence to overthrow the plain meaning of the pink slip notice, particularly in te light of the many surrounding circumstances.
We do not agree with appellants' (fourth point) that the court erred in refusing to admit evidence arising after the date of the Referee's hearing.
The judgment of the Superior Court ordered that the decision of the Appeals Board be vacated, annulled and set aside, and that a peremptory writ issue commanding the appellant Commission to grant and pay to each of the 191 claimants named therein ‘his just monetary benefits as defined in the Unemployment Insurance Act * * * accruing after January 18, 1946.’
Section 1094.5, Code Civ.Proc., provides the form of such a judgment, as follows: ‘(e) The court shall enter judgment either commanding respondent to set aside the order or decision, or denying the writ. Where the judgment commands that the order or decision be set aside, it may order the reconsideration of the case in the light of the court's opinion and judgment and may order respondent to take such further action as is specially enjoined upon it by law but the judgment shall not limit or control in any way the discretion legally vested in the respondent.’
The hearing before the Referee on which this record was made was held on April 17, 1946. At that time the picket line was still around the plant. Mainfestly the record embraces no more than the period from January 14 to April 17, 1946, and by the same token the judgment speaks only as of that period.
The judgment is modified to read in part as follows: ‘It is ordered adjudged and decreed that the California Employment Stabilization Commission and the California Unemployment Insurance Appeals Board set aside the order and decision of the Appeals Board dated February 25, 1947, and that said Commission reconsider the cases of the claimants in the light of this opinion and judgment, and take such further action as is specially enjoined upon it by law.’
As so modified the judgment is affirmed.
1. The prevailing opinion of the Appeals Board filed by two of the three members on February 25, 1947, reads in part as follows:‘Reason for Decision. The record in this case clearly shows that the claimants left their work between January 14, and January 17, 1946, because of their unwillingness to cross a picket line which had been established around the employer's premises. Therefore, the claimants voluntarily left their work because of a trade dispute within the principles enunciated by the California Supreme Court in Bodinson Manufacturing Company v. California Employment Commission, 17 Cal.2d 321 [109 P.2d 935], and as a result of such leaving, became ineligible to receive benefits for their unemployment under the provisions of Section 56(a) of the * * * Act.‘There is also at issue in this appeal the question as to whether or not the so-called ‘Employment Termination’ notices issued to the claimants herein by the employer and dated January 18, 1946, removed the disqualification which we hold theretofore existed under Section 56(a) of the Act. [§ 56a is then quoted].‘It is to be noted that the statutory section of the Act which we are considering provides specifically that when an individual leaves his work because of a trade dispute, no benefits shall be payable to him ‘for the period during which he continues out of work by reason of the fact that the trade dispute is still in active progress in the establishment in which he was employed.’ In Mark Hopkins, Inc., v. California Employment Commission, 24 Cal.2d 744 [151 P.2d 229], the Supreme Court of California had before it a case involving the duration of the disqualification under the language used by the Legislature in Section 56(a), above quoted. The Supreme Court observed in the Mark Hopkins case:“A claimant is thus ineligible for benefits if the trade dispute is the direct cause of his continuing out of work. If the claimant who leaves his work because of a trade dispute subsequently obtains a permanent full-time job, however, he is no longer out of work and the continuity of his unemployment is broken. If he loses his new job for reasons unrelated to the dispute, he is unemployed by reason not of the trade dispute, but of the loss of the new employment. The trade dispute that caused him to leave his original employment is not the cause of his subsequent unemployment, and he would no more be disqualified from receiving benefits for such unemployment than if he had not been previously employed in the struck establishment.“The termination of a claimant's disqualification by subsequent employment thus depends on whether it breaks the continuity of the claimant's unemployment and the causal connection between his unemployment and the trade dispute. Such employment must be bona fide and not a device to circumvent the statute. It must sever completely the relation between the striking employee and his former employer. The strike itself simply suspends the employer-employee relationship but does not terminate it. Mere temporary or casual work does not sever this relationship for it does not effectively replace the former employment. The worker expects its termination and does not look forward to that continuity of work and income that characterizes permanent employment. If bona fide, it completely replaces the claimant's former employment, terminating whatever relation existed between the claimant and his former employer. It must be judged prospectively rather than retrospectively, with regard to the character of the employment, how it was obtained, and whether it was in the regular course of the employer's business and the customary occupation of the claimant. In the absence of special circumstances, employment of a short duration admits of an inference that it was not entered into in good faith with the intent that it be permanent.'‘Although it is true that the Supreme Court was considering whether obtaining and losing subsequent, bona fide employment would terminate an initially-imposed trade dispute disqualification, we do not believe that the Mark Hopkins case, considered in its entirety, should be construed so narrowly as to stand solely for the proposition that securing and losing intervening employment is the only basis upon which the disqualification can be removed. In the language of the Court, the disqualification continues so long as the trade dispute is the direct cause of the claimant continuing out of work and if the trade dispute causing the claimant to leave his original employment is not the cause of his subsequent unemployment, ‘he would no more be disqualified from receiving benefits for such unemployment than if he had not been previously employed in the struck establishment.’‘The rationale of the Court's decision seems to us to be predicated upon causation, as it necessarily must be, for the phrase ‘by reason of,’ used in Section 56(a) of the Act is the equivalent of ‘as the direct and proximate result of.’ (Dougherty v. Ellingson, 97 Cal.App. 87, 275 P. 456). If it can be found under the facts of a particular case that the claimant's unemployment is no longer attributable to his leaving work because of a trade dispute, then the disqualification provided in Section 56(a) of the Act is no longer applicable. Such a conclusion reasonably follows from the specific provisions of Section 56(a) which relate the continuance of the disqualification to ‘the fact that the trade dispute is still in active progress in the establishment in which he was employed.’‘Upon the causation theory, it has been previously held by the California Unemployment Insurance Appeals Board that an unequivocal discharge by the employer completely severing the employment relationship removes the trade dispute disqualification (See Case 1792–4222). The cited decision of the Board was predicated upon a complete dissolution of the employment relationship, as a result of which the Board concluded that the claimant's unemployment from the date of termination, though indirectly the result of a trade dispute, was directly caused by the subsequent, intervening act of the employer, so that the claimant's unemployment on and after the date of the unequivocal termination, was no longer attributable to the trade dispute. It was our conclusion that upon the complete severance of the employment relationship, such intervening act became the direct and proximate cause of the claimant's unemployment rather than the original trade dispute, and, applying the principles of the Mark Hopkins case, the disqualification was held to have terminated as of the date of the intervening cause.‘In the Mark Hopkins case, the Court sets forth the principle that to terminate the disqualification, the intervening cause must sever completely the relationship between the striking employee and his former employer. In previous cases where it has been held by the Appeals Board that a discharge by the employer will remove the disqualification under Section 56(a) of the Act, the facts showed that the discharge by the employer was unequivocal and completely dissolved the employment relationship between the employer and worker. It seems to us apparent that unless the discharge is absolute, the chain of causation between the claimant's unemployment and the trade dispute has not been broken and that nothing short of a bona fide, unequivocal discharge intended as such by the employer and so accepted by the employee, both having no intention or contemplation that the relationship would be resumed in the future, will suffice to remove the disqualification. Less than an unequivocal discharge, in our opinion, would not be such a direct, intervening cause upon which, under the Mark Hopkins case, we would predicate a termination of the disqualification.‘Applying the above principles to the instant case, it is the conclusion of the majority of this Appeals Board that the steps taken by the employer subsequent to the time the claimants left their work because of a trade dispute cannot reasonably be viewed as such an unequivocal discharge by the employer that complete severance of the employer-employee relationship resulted. There is credible evidence before us that the employer, in accordance with a long established rule, intended that the ‘Employment Termination’ notice was to affect only the claimant's rights in the employer's bonus plan and to accrued vacation privileges.‘That a definite end of the employment relationship was not contemplated is substantiated by the employer's arrangements to continue, on behalf of the claimants, the latter's contributions to a pension fund and the agreement whereby the claimants could retain their membership in the employer's hospitalization plan. The fact is undisputed that at the time the claimants became employees of the employer each was given an employee booklet in which it was stated that unauthorized absence from work in excess of three days would result in removal of the worker's name from the payroll and termination of the employment period. It is likewise undisputed that in the face of this provision, and with full knowledge, the claimants voluntarily left their work on and after January 14, 1946, and remained away without authorization for more than the prescribed period, thus setting in motion, by their own voluntary act, the circumstance of which they now seek to take advantage. We also have in the record before us the employer's offer of January 21, 1946, urging the claimants to return to work immediately or as soon as strike conditions ceased to exist. Considering all of this evidence in its entirety, leads us to but one conclusion: that the employer-employee relationship between the employer and the claimants herein was not unequivocally severed on January 18, 1946, by an independent, intervening act of the employer; that any severance which the claimants alleged occurred was primarily due to their own voluntary action in remaining away from work without authorization for a period in excess of three days, which they knew would result in the issuance of an ‘Employment Termination’ notice by force of their agreement with the employer; that the chain of causation between the claimant's unemployment and their leaving work because of a trade dispute was not broken within the principles set forth by the Supreme Court in the Mark Hopkins case; and that the claimants after January 18, 1946, voluntarily continued out of work because of a trade dispute which was in active progress at the establishment where they were last employed. Therefore the claimants remained subject to disqualification from benefits under the provisions of Section 56(a) of the Unemployment Insurance Act.‘The decision of the Referee is reversed.‘Benefits are denied.’
NOURSE, P. J., and DOOLING, J., concur.