Opinion ID: 1209204
Heading Depth: 1
Heading Rank: 6

Heading: federal statutory violations and nlra pre-emption

Text: The rationale underlying Hawtel's federal statutory and NLRA pre-emption arguments is that the Wagner-Peyser Act, the Social Security Act, and the NLRA impose a work test requiring strikers to register in person with a state employment office and to search for work. [15] Hawtel does not cite, nor has independent research disclosed, any provision in these statutes or their implementing regulations which expressly requires all claimants to file in person or to register and search for work in order to be eligible for benefits. We hold that: (1) the Hawaii unemployment compensation system's payment of benefits to strikers for whom it waives § 383-29(a)(2)'s work registration requirement does not violate the Wagner-Peyser Act or the Social Security Act; and (2) Hawtel II collaterally estops the relitigation of NLRA pre-emption. Both before and after the 1974 Hawtel strike, United States Labor Department interpretive guidelines indicated that the DLIR's treatment of the strikers comported with federal law. [16] An examination of the federal statutes at issue confirms this conclusion.
The Wagner-Peyser Act and its implementing regulations establish a national system of state-run public employment offices. These offices provide employers with a means of recruiting nonlocal workers when the supply of local workers is inadequate. Alfred L. Snapp, Etc. v. Puerto Rico, ex rel. Barez, 458 U.S. 592, 594-95, 102 S.Ct. 3260, 3262, 73 L.Ed.2d 995, 999 (1982). The Wagner-Peyser Act's purpose is to protect migratory workers who meet the needs of employers using federal resources to secure workers. E.g., Gomez v. Florida State Employment Service, 417 F.2d 569, 571-72 (5th Cir.1969). Hawtel does not demonstrate that the DLIR practices challenged here frustrate that purpose. 20 C.F.R. § 652.3(e), which implements the Wagner-Peyser Act, requires states to administer a labor exchange system with the capacity to meet the work test requirements of the state unemployment compensation system. (Emphasis added.) As this regulation's plain language instructs, work test requirements, if any, are defined by state law rather than federal law.
Hawtel contends that the DLIR violates 42 U.S.C. §§ 503(a)(2) and (8) because its practice of waiving registration for strikers and not imposing a work test fails to constitute the proper and efficient administration which those sections require. We reject this contention. In upholding the payment of unemployment compensation to strikers, the United States Supreme Court concluded that [t]he voluminous history of the Social Security Act made it abundantly clear that Congress intended the several states to have broad freedom in setting up the types of unemployment compensation that they wish. New York Telephone Co. v. New York State Department of Labor, 440 U.S. 519, 537, 99 S.Ct. 1328, 1339, 59 L.Ed.2d 553, 567 (1979) (plurality); accord id. at 542, 544, 99 S.Ct. at 1342, 1343, 59 L.Ed.2d at 570, 571; id. at 546-47, 99 S.Ct. 1344, 59 L.Ed.2d at 572-73 (Brennan, J., concurring in the result); id. at 547, 549, 551, 99 S.Ct. at 1344, 1345, 1346, 59 L.Ed.2d at 573, 574, 575 (Blackmun and Marshall, JJ., concurring in the judgment). The court found that the legislative history of the Social Security Act and the NLRA, which Congress enacted within five weeks of one another, demonstrates congressional intent to permit states to pay unemployment compensation to strikers, notwithstanding the state scheme's alteration of the economic bargaining power between labor and management. Id. at 531-532 and n. 20, 99 S.Ct. at 1336 and n. 20, 59 L.Ed.2d at 563-64 and n. 20; id. at 546-47, 99 S.Ct. at 1344, 59 L.Ed.2d at 572 (Brennan, J., concurring in the result); id. at 551, 99 S.Ct. at 1346, 59 L.Ed.2d at 575 (Blackmun and Marshall, JJ., concurring in the judgment). Pursuant to the state statute at issue, New York charged New York Telephone for $40 million of the $43 million in compensation paid to the strikers. Id. at 155 n. 6, 99 S.Ct. at 1349 n. 6, 59 L.Ed.2d at 578 n. 6 (Powell, J., Burger, C.J., and Stewart, J., dissenting). The court upheld this practice and reaffirmed that state unemployment compensation statutes `may ... put the entire burden upon the employer[.]' Id. at 538 n. 30, 99 S.Ct. at 1340 n. 30, 59 L.Ed.2d at 568 n. 30 (emphasis added and citation omitted). We also are unpersuaded by Hawtel's distinction of New York Telephone as involving a statute with stricter eligibility criteria than Hawaii's. Although a distinction exists, it is meaningless. The New York statute imposed upon strikers an eight-week waiting period for benefits, as opposed to Hawaii's one-week period. Id. at 523, 99 S.Ct. at 1332, 59 L.Ed.2d at 558. Asserting that the New York statute also required strikers to register and to accept temporary jobs, Hawtel deduces from these facts an implicit work test. New York Telephone discredits this analysis by emphasizing congressional sensitivity to the importance of the States' interest in fashioning their own unemployment compensation programs and especially their own eligibility criteria.  Id. at 539, 99 S.Ct. at 1340, 59 L.Ed.2d at 568 (emphasis added). Under § 383-29(a), work registration provisions are eligibility criteria. As such, they are one of the features of the unemployment compensation system which Congress deliberately left for Hawaii to design. Nothing in New York Telephone or the Social Security Act mandates a work test or requires Hawaii to impose the same eligibility criteria as New York.
Hawtel next argues that the NLRA pre-empts the DLIR's administration of unemployment compensation in the period since the Ninth Circuit's 1980 Hawtel II decision. The circuit court correctly perceived that this issue formulation is an attempt to evade the collateral estoppel effect of Hawtel II 's holding that the NLRA does not pre-empt Hawaii's statutory scheme providing unemployment compensation to strikers. Collateral estoppel is an issue preclusion doctrine which bars a party from relitigating a factual or legal issue necessarily decided in a prior suit on a different claim involving the party or the party's privy. Parklane Hosiery Co. v. Shore, 439 U.S. 322, 326 and n. 5, 99 S.Ct. 645, 649 and n. 5, 58 L.Ed.2d 549, 559 and n. 5 (1979). [17] However, collateral estoppel is inapplicable if controlling facts or legal rules have changed since the prior suit. Montana v. United States, 440 U.S. 147, 158, 159, 99 S.Ct. 970, 976, 59 L.Ed.2d 210, 220 (1979). Hawtel reasons that collateral estoppel is inapplicable. We disagree. The fundamental issue framed by Hawtel here is identical to the pre-emption issue litigated in Hawtel I and II. The issue is whether the NLRA pre-empts the payment of unemployment compensation to strikers because the payment alters Congress' balance of labor-management collective bargaining power. Compare Amended Opening Brief at 47; Reply Brief at 8 with Hawtel II, 405 F. Supp. at 276; Hawtel I, 378 F. Supp. at 794. Hawtel's asserted discovery of additional facts about the DLIR's administrative procedures does not change the identity of the pre-emption issue here and in the prior federal litigation. The procedures concern eligibility criteria which, as explained above, Congress specifically intended the states to design. The procedures therefore are not controlling facts warranting re-examination of the NLRA pre-emption issue. Collateral estoppel also applies because Hawtel could have raised the additional facts in the federal litigation before its termination by Hawtel III in 1982. If a new legal theory or factual assertion advanced in a second action is relevant to the subject matter and the issue adjudicated in a first action, so that it could have been raised in the first action, collateral estoppel applies notwithstanding the failure to raise the legal theory or factual assertion in the first action. 1B MOORE'S FEDERAL PRACTICE ¶ 0.443[2] at 760-61 (1984). The facts upon which Hawtel now relies concern the administration of Hawaii's unemployment compensation scheme. These facts clearly are relevant to the subject matter and issues presented by the Hawtel III supplemental complaint, which challenged, under the same federal laws invoked here, Hawaii's collection and administration of its unemployment tax and benefit scheme[.] 691 F.2d at 907. We hold that Hawtel is collaterally estopped from relitigating NLRA pre-emption.