Kennedy v. Westinghouse Electric Corp.
Kennedy v. Westinghouse Electric Corp.
Opinion of the Court
The opinion of the court was delivered by
Plaintiffs sue on behalf of themselves and upwards of 900 other hourly paid employees of defendant’s Jersey City plant to recover holiday pay for Labor Day 1951 provided for by the terms of a collective bargaining agreement entered into by the defendant with United Electrical, Radio and Machine Workers of America (U.E.) covering employees of 21 of defendant’s plants. Plaintiffs recovered judgment in the Superior Court, Law Division, after a trial without a jury, 25 N. J. Super. 601 (1953). The Appellate Division reversed, 29 N. J. Super. 68 (1953). We allowed certification on plaintiffs’ petition, 15 N. J. 79 (1954).
Defendant refused to pay the holiday pay because of the concerted action of the hourly paid employees on each work day but two from July 12, 1951 to September 11, 1951 (Labor Day fell on September 3) in stopping work after only 3% to 6 hours during their scheduled 8-hour shifts. The trial judge found, and plaintiffs do not challenge the finding, that the concerted action was promoted by the officers
The suit, brought by and on behalf of the employees against the employer, is based upon provisions of the collective bargaining agreement between the company and the union. However, the standing of the employees in their own right to maintain the action upon the agreement is not questioned. Christiansen v. Local 680 of Milk Drivers, etc., 126 N. J. Eq. 508 (Ch. 1940).
Widespread recognition, while slow in coming, is now common that collective bargaining agreements give use to legal rights. See, for example National Labor Relations Act as amended by Taft-Hartley Act, 29 U. S. C. A., sec. 185; Annotation, 95 A. L. R. 10. The day is past when courts denied recognition to such agreements upon grounds that they merely established usages with very little, if any, legal consequences, or lacked consideration, or were unenforceable for want of mutuality of remedy, or reflected duress. 1 Teller, Labor Disputes and Collective Bargaining, secs. 158-162 (1940). The end of such concepts was forecast with the adoption and promotion of the public policy expressed in much federal and state legislation fostering and encouraging collective bargaining between labor unions and employers as the prime tool to achieve and maintain industrial peace and uninterrupted production to further essential social and economic objectives. See National Labor Relations Act, 49 Stat. 449 (1935), as amended by the TaftHartley Act, 61 Stat. 136 (1947), 29 U. S. C. A., secs. 151 et seq., New Jersey Constitution of 1947, Art. I, par. 19. The signing of a written contract embodying the terms agreed upon is regarded as the final and an essential step in the
But the collective bargaining agreement is in many respects a novelty in the courts raising problems not presented by ordinary contracts nor readily dealt with under traditional principles of contract law. Less than 30 years ago one commentator observed that “it is somewhat surprising to discover that their legal nature has never been carefully considered or precisely defined in an American court decision,” Fuchs, Collective Labor Agreements in American Law, 10 St. Louis L. Rev. 1 (1925). Several courts which have since attempted an analysis have found it hard precisely to define the jural relation of the covered employees to the contracting parties and their rights and duties under the contract. The fact that the collective bargaining agreement establishes a structure of employment relations not just for particular known employees but for persons from time to time employed during the contract term and not always members of or desiring to be members of the contracting union, has led courts to say that the agreement resembles “a trade agreement * * * likened to the tariffs established by a carrier, to standard provisions prescribed by supervising authorities for insurance policies, or to utility schedules of rates and rules for service,” J. I. Case Co. v. National Labor Relations Board,, 321 U. S. 332, 64 S. Ct. 576, 88 L. Ed. 762 (1944); that it is “in many ways a treaty,” Yazoo & M. V. R. Co. v. Webb, 64 F. 2d 903 (5 Cir., 1933); in our own books that “The relation between the collective bargain and the individual contract of employment somewhat resembles that between a group insurance policy and the individual insurance certificates issued under it,” Christiansen v. Local 680 of Milk Drivers, etc., supra, 126 N. J. Eq. 512.
We have noted earlier that the employer here accepts the law to be that the plaintiffs have the right to sue their
“That the market place should demand of the law a different and more effective way of dealing with newly arising problems is nothing novel to our law. The law merchant thus became part of the com*287 mon law. It is as important as it is to maintain industrial peace that a like process be made the subject of conscious judicial treatment.”
The matter presented to us for decision in the instant case does not, however, call upon us to devise any special treatment in order to make our determination. The issue is the very narrow one of the interpretation of the collective bargaining agreement, and more particularly of the provisions governing holiday pay. We agree with plaintiffs that the canons of construction brought to bear on the ordinary contract.are fully serviceable in ascertaining the meaning of the language employed in a collective bargaining agreement. It may be that the well known reluctance of negotiators of labor agreements to avail themselves of a lawyer’s services in their drafting will often create more need for interpretation and aggravate its difficulties but the standards of construction will not differ for that reason. It is also true that these agreements increasingly provide for settlements of differences over interpretation and application by arbitration (this agreement does not so provide), but we do not understand, and neither side suggests, that we should take note of any new or different canons of construction evolved in the labor arbitration process of peculiar application to collective bargaining contracts. It is obvious that the important function of the collective bargaining agreement to further industrial tranquility justifies, indeed demands, that the agreement “be construed not narrowly and technically but broadly and so as to accomplish its evident aims,” Yazoo & M. V. R. Co. v. Webb, supra, 31 Am. Jur. Labor, sec. 113; and that has been the decided tendency of the cases. Teller, supra, p. 505. However, as plaintiffs’ brief urges, with that general precept in mind, the canons of construction applied to a commercial agreement in Mantell v. International Plastic Harmonica Corp., 141 N. J. Eq. 379, 386-387 (E. & A. 1947), can and should govern us here:
“The general purpose of the agreement is to be considered in ascertaining the sense of particular terms. The design of the parties to a written contract is to be collected from the instrument as an en*288 tirety. And the writing is to have a reasonable construction. Disproportionate emphasis upon a single provision does not serve the purpose of interpretation. Words, phrases and clauses are not to be isolated but related to the context and the contractual scheme as a whole, and given the meaning that comports with the probable intention. The literal sense of the terms may be qualified by the context. The significance of a particular part of the writing is determined by a consideration of all its parts. It is the revealed intention that is to be effectuated. In a word, the standard of interpretation is the meaning that would be attached to the integration by a reasonably intelligent person. And, in the quest for the common design, the situation of the parties, the attendant circumstances, and the objects they were thereby striving to attain, are to be regarded.” See also Casriel v. King, 2 N. J. 45, 50 (1949).
The provisions of the agreement important to the controversy are the following:
“Section VII — Strikes, Stoppages, and Lockouts
A. The Union and the Locals will not cause or officially sanction their members to cause or take part in any strike (including sit-downs, stay-ins, slow-downs, or any other stoppage of work) during the life of this Agreement. * * *”
“Section X — Hours of Work
The basic work week will be forty (40) hours based on eight (8) hours per day, five (5) days per week, Monday to Friday inclusive. An employee’s work day is the twenty-four hour period beginning with his regularly assigned starting time on his workshift, and his day of rest starts at the same time on the day or days he is not scheduled to work. His work week starts with his regularly assigned work period on Monday. Variations in hours of and the schedules of hours of the several shifts are subjects for local negotiations.”
“Section XII — Holidays and Vacations
1. Holidays
a. Holidays observed by the Companies will be New Year’s Day, Washington’s Birthday, Memorial Day, Independence Day, Labor Day, Thanksgiving, and Christmas. Holidays falling on Sunday will be observed on Monday.
b. All hourly paid employees who have completed three (3) months’ continuous service immediately preceding the holiday will be paid for their established shift hours on a holiday observed between Monday and Friday both inclusive. Hourly paid employees who were laid off for lack of work and are rehired within five (5) years after layoff, who had completed three (3) months’ continuous service and had a total employment of at least one (1) year prior to their layoff, will also receive the above holiday pay.
c. Hourly paid employees will be paid for such hours at their average earned rate, as defined in Section XI, for the pay roll period involved.
*289 d. The above payment will be made only to hourly paid employees who are on tbe active roll as of the day before the holiday within the week and who earn some wages during the week in which the holiday falls or any of the four preceding weeks.
e. Salaried employees will be paid for the seven holidays observed by the Companies falling within the work week, Monday to Friday, both inclusive.”
The trial judge found as a fact, and again the plaintiffs do not contest his finding, that the conduct of the employees in curtailing their shift hours with the encouragement of the officers of the local union constituted a work stoppage in violation of the first quoted clause from section VII of the agreement. The company, however, has not chosen in this court to assert by reason thereof that it was or is entitled to terminate the agreement in toto and to be relieved of all obligation thereunder. There are evident practical reasons why the company should conclude that such a step is not an expedient course. The company bottoms its defense upon the narrow ground that by their conduct the employees and each of them put themselves in a position where they could not satisfy the condition precedent prescribed by section XII (b) to the payment of holiday pay, namely, that they be hourly paid employees “who have completed three (3) months continuous service immediately preceding the holiday” (Emphasis supplied).
The gist of plaintiffs’ argument opposing the company’s contention is that “continuous service” means and was intended by the parties to mean no more than that the employees should have been, as they were, on the company’s “active” payroll during the three-month period, that is, have the “status” of employees continuously during that time. They insist that this is the meaning the words have acquired in labor relations parlance and point to their widespread use in that sense in clauses of collective bargaining agreements governing seniority, vacation pay and pensions. They cite arbitration awards so construing the words in connection with such clauses, concluding that the awards show a “consistent equating of ‘service’ to seniority accumulation, and ‘continu
But plaintiffs’ argument gives insufficient consideration to other pertinent provisions of section XII, particularly as they are interrelated with section X. Dealing with the two words “continuous service” separately, and first with the word “service,” we cannot agree that it is to be taken as synonymous with employment “status.” Section X prescribes a work week from Monday to Friday, and section XII provides for holiday pay only when the named holiday is observed on a day from Monday to Friday. The clear implication is that the holiday provision was intended to assure that the take-home pay of an employee regularly earning wages for labor performed should not be diminished when the holiday is observed on a day during his regular work', week. The word “service” is thus illumined as contemplating the performance of labor in ordinary course during prescribed work schedules operative in the three-month period. Paragraph (d) of section XII does not oppose but buttresses this conclusion. That paragraph makes it clear that it is not enough that the employee be on the active roll; he must also have earned some wages for labor performed during the week in which the holiday falls or any of the four weeks preceding the holiday. Finally, but particularly persuasive that “service” contemplates “labor performed,” under (b) and (c) of section XII holiday pay is at the employee’s “average earned rate for the payroll period involved” (“straight time earnings” enhanced as provided by section XI) for his “established shift hours,” prescribed as eight hours by section X, except as varied by local negotiations, which was not the case here. The conclusion is irresistible
Plaintiffs urge that, notwithstanding the light as to the parties’ meaning thus gained from the context of the agreement, we should conclude that “service” means “employment status” and not the performance of labor, because holiday pay was provided here as “additional wages for services” as part of a “wage package” in the nature of a disguised wage boost to keep down the amount of the straight wage increase entering into the basic wage rate. We are cited to the history of wage negotiations during and after the recent war when wage controls inhibited the amounts of increases in basic rates and the practice grew up of granting permissible “fringe” benefits, such as holiday pay, in lieu thereof. There are two answers to this argument. The first is that the record is absolutely barren of any evidence that the instant holiday pay provision came into this contract as part of a “wage package.” The second is that if holiday pay was provided in lieu of a commensurate wage increase we should expect the holiday pay provision to call for the payment for a named holiday observed on Saturday or Sunday. The limitation to holidays observed during the basic work week is conclusive in the circumstances here shown that the provision was intended to allow the employees time off on the observed holidays without attendant reduction in weekly take-home pay.
Plaintiffs also endeavor to support their interpretation of “service” as “status” by reference to the second sentence of section XII (b) which provides for holiday pay to employees rehired within five years after a lay-off period prior to which they had completed three months of continuous service and at least one year’s total employment with the company. We can find no relevancy whatever of that sentence to the question of the meaning of “service.” It is clear to us that that sentence merely adds to the group of employees eligible to qualify for holiday pay such employees as have been rehired within the three months’ period immediately preceding the
We conclude, then, that “service” means labor performed in the context of the holiday pay clause, and turn to the question whether the refusal of the employees on the daj's mentioned to work more than 3% to 6 hours of their scheduled eight-hour shifts broke the continuity of the “continuous” service called for by the agreement. It does not appear from the record that any of the employees concerned with this suit were absent during the scheduled shift hours throughout the three months’ period before Labor Day 1951 except during the hours on the days (all but two) Avhen they refused to complete their shifts. In the sense that they put in some hours of labor on each work day of the period they did render continuous labor, and it is contended on their behalf that they thereby satisfied the requisite of performing “continuous service.” Reliance is again put by plaintiffs upon paragraph (d) of section XII which, it is contended, obviously imports that even extended absences for weeks at a time do not interrupt continuity of service, this because employees are required thereunder to earn only “some wages” during the week in which the holiday falls or any of the four weeks preceding the holiday and be on the active roll as of the day before the observed holiday.
We may conclude that “continuous” service does not contemplate the performance of labor during every scheduled shift hour of every work day. In the very nature of things “there is really no such thing as continuous labor. Holidays, sicknesses, recreation periods, week-ends, all are breaks in the continuity of one’s occupation, but would not necessarily destroy its continuity.” United States v. Perry, 55 F. 2d 819 (8 Cir., 1912). Paragraph (d) is to be read, we think, as implying no more than that breaks of service
Affirmed.
Dissenting Opinion
(dissenting). I am in accord with Judge Conlon that the plaintiffs have established their right to the holiday pay in question. I would award them judgment for
Reference
- Full Case Name
- MEL KENNEDY, ANTHONY LONGO, MARTIN DeVOURSNEY, JOSEPH SCERBO, EDWARD WIESE, BEN CHIVALK, WILLIAM E. REYNOLDS, Sr., AND WALTER GEISLER, PLAINTIFFS-APPELLANTS, v. WESTINGHOUSE ELECTRIC CORP., a CORPORATION OF PENNSYLVANIA, DEFENDANT-RESPONDENT
- Cited By
- 34 cases
- Status
- Published