Court Opinion

ID: 9705578
Source: CourtListenerOpinion
Date Created: 2023-08-26 01:12:40.854835+00
Date Added: 2024-06-11T18:22:12.628717
License: Public Domain

Karen R. Baker, Judge, dissenting. The Southwestern Bell employees who participated in a force reduction selection process pursuant to their union contract are being denied unemployment benefits based upon the majority’s reasoning that participating in the selection process rendered their termination by Southwestern Bell “voluntary” under our statutes. The majority, in reaching this con-elusion, ignores the public-policy considerations of the Arkansas General Assembly, the body that represents the collective will of the Arkansas people. The Arkansas legislature in the 2003 session specifically stated that employees who participate in a force-reduction process shall not be disqualified from benefits: (c)(1) No individual shall be disqualified under this section ifhe or she left his or her last work because he or she voluntarily participated in a permanent reduction in the employer’s work force after the employer announced a pending reduction in its work force and asked for volunteers. (2) Such actions initiated by the employer shall be considered layoffs regardless of any incentives offered by the employer to induce its employees to volunteer. Ark. Code Ann. § 11-10-513 (Supp. 2003). The majority characterizes this amendment as a change in public policy and asserts that the dissent would apply this change retroactively. That is not the case. Our public policy for over twenty years, as expressed by this court’s decision in Jackson v. Daniels, 267 Ark. 685, 590 S.W.2d 63 (Ark. App. 1979), even without the legislature’s specific directive, requires that we reach the conclusion that these employees were not disqualified from receiving unemployment benefits. In Jackson, following the employer’s announcement that it would be terminating an employee, appellant Jackson volunteered saying that if the employer had to terminate someone, she hoped she would be the one to lose her job. By per curiam opinion, we found that the employee’s “volunteering” to be the one to be terminated did not render her leaving employment voluntary under our statutes and awarded benefits. In reaching our decision, we said: [I]t is admitted that a reduction in staff of at least three employees was necessitated at the decision of the employer. The fact that the claimant preferred to be one of them rather than those she had hired does not alter the underlying fact that her employment ended by reason of work reduction .... Jackson, 267 Ark. at 687, 590 S.W.2d at 64. If the majority is suggesting that the decision in Reynolds Metals Co. v. Couch, 8 Ark. App. 37, 648 S.W.2d 797 (1983), invalidated the reasoning in Jackson without expressly overruling the case, then we would be faced with two precedents in conflict with one another. However, the court in Reynolds specifically stated that the situation in Jackson was different from the situation in Terry v. Director of Labor, 3 Ark. App. 197, 623 S.W.2d 857 (1981), and the one before them in Reynolds. Unfortunately for appellants in this case, the court in Reynolds did not specifically identify the distinction. Despite that omission, the readily apparent difference is that the employers in Terry and Reynolds terminated the employees’ current positions, then offered the employees other employment with the company pursuant to union contracts. The employers had already decided that the positions in which particular employees were employed would be terminated. Reynolds did not overrule Jackson. Until today, the precedent of Jackson controlled and stood for the proposition that an employee who volunteers to be considered for termination when the employer initiates a work-force reduction is not disqualified from receiving unemployment benefits. Appellants argued at oral argument that the Director was following the holding in Jackson prior to the decisions in these cases, and that the 2003 amendment of Ark. Code Ann. § 11-10-513 was enacted in response to these decisions. Appellees did not dispute that assertion, but merely insisted that the statute cannot be applied retroactively. Although clearly the amendment itself was not applicable at the time these employees were denied benefits, the amendment is an indication of the legislature’s intent that we are required to determine when construing our unemployment security laws. Statutes are to be construed with reference to the public policy which they are designed to accomplish. Commercial Printing Co. v. Rush, 261 Ark. 468, 549 S.W.2d 790 (1977); Ark. Tax Comm’n v. Crittenden County, 183 Ark. 738, 38 S.W.2d 318 (1931). As the supreme court stated in Little Rock Furniture Mfg. Co. v. Commr. of Labor, 227 Ark. 288, 298 S.W.2d 56 (1957), our Employment Security Act must be given an interpretation in keeping with the declaration of state policy. The intent of the Arkansas Legislature controls the construction of our unemployment security laws. Feagin v. Everett, 9 Ark. App. 59, 66, 652 S.W.2d 839, 843 (1983). Unemployment benefits are intended to benefit employees who lose their jobs through no fault or voluntary decision of their own. There are not intended to penalize employers or reward .employees, but to promote the general welfare of the State. Wacaster v. Daniels, 270 Ark. 190, 194, 603 S.W.2d 907, 910 (Ark. App. 1980). The policy of the Arkansas Employment Security Act is “to encourage employers to provide more stable employment” and to accumulate “funds during periods of employment from which benefits may be paid for periods of unemployment.” Ark. Code Ann. § 11-10-102(2)(Repl. 2002). In a 1910 case, our supreme court recognized that collective-bargaining agreements help advance the interests of society: The conservation of the chief asset of the laboring man namely, his labor, through combination with his fellows and by their organized efforts is to be commended rather than condemned. For in that way his well-being may be best promoted and the interest of society thereby advanced. As observed by Judge Taft in Thomas v. Cincinnati, N. O. & T. Ry. Co. (C. C.), 62 Fed. 803, 817: “It is of benefit to them and the public that laborers should unite. They have labor to sell. If they stand together they are often able, all of them, to command better prices for their labor, than when dealing singly with rich employers, because the necessities of the single employee may compel him to accept any terms offered.” Meier v. Speer, 96 Ark. 618, 626-27, 132 S.W. 988, 991-92 (1910). We have recognized for almost a century that collective bargaining agreements promote employment stability and the general welfare of the State. We should follow the majority of jurisdictions that hold that employer-initiated work-force reductions and terminations do not disqualify terminated employees from benefits: Authority is split over whether an employee volunteering to be included in an employer-planned reduction in force . . . should be considered as having effectively resigned from employment. The majority of these cases provide that although an employee may opt for inclusion in an employer-mandated layoff, the layoff itself is still instituted at the employer’s prerogogative. The fact that the employees may decide among themselves who will bear the burden of termination does not make the employee’s departure voluntary. These courts reason that when the first and last steps for the termination process are taken by the employer, i.e., planning the reduction and then selecting certain employees for inclusion, even one who has agreed to participate in the process has not voluntarily terminated employment. B.E. & K Construction v. Abbott, 59 P.2d 38, 42-43 (2002) (citations omitted). We have already applied this reasoning in Jackson. Further, the case cited by the Board of Review does not support the majority’s position. The Board cited Oklahoma Empl. Sec. Comm. v. Board of Review for Empl. Sec., 914 P.2d 1083 (Okla. Ct. App. 1996), saying that “[i]n cases such as the current one, the offered separation package is best characterized “as an ‘opportunity’; that is, it was a bona fide choice that could prove as beneficial as continuing in employment.” The Board inserted the parenthetical after the cite stating “(denying benefits to claimant who chose to accept a voluntary separation package when her seniority insulated her from any real danger of being laid off).” The Oklahoma case, however, distinguishes cases where the employees were found eligible for unemployment compensation even though they voluntarily accepted separation benefits under a reduction-in-force plan. The opinion specifically states that each case it was distinguishing involved a mandatory reduction in workforce rather than a truly voluntary separation incentive. This distinction was again applied last year by the Oklahoma Supreme Court in B.E. & K Construction v. Abbott, supra, in the context of a worker compensation claim. The court reasoned: We consider the analysis proffered by the majority of jurisdictions addressing whether an employee’s offer to be included in an employer-announced lay off should be considered a voluntary termination persuasive and logical. The majority’s conclusions are based in the realities of the workplace — an employee electing to volunteer for an employer-planned reduction in force does not exercise the ultimate power or final decision as to which employees will be targeted for termination. It is the employer who decides to eliminate a job and to lay off a given individual, based on the employer’s needs. It is irrelevant that the employee may have made the employer’s determination easier by first volunteering to be laid off. Id. at 43-44. Our legislature codified that reality with the 2003 amendment of Section 11-10-513. We recognized and applied that reality in Jackson more than twenty years ago. Therefore, I would reverse and order an award of benefits. Hart and Roaf, JJ., join.