Wis.LIRC WC Decision: Ebben - January 22, 1991 - ND � 7.27 - Jurisdiction

BEFORE THE
STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION

DAVID L. EBBEN, Applicant

VALLEYCAST, INC., Employer

WAUSAU UNDERWRITERS INSURANCE COMPANY, Insurer

WORKER'S COMPENSATION DECISION
Claim No. 88-031689

The employe submitted a petition for Commission review alleging error in the Administrative Law Judge's Findings and Order issued on July 27, 1990. At issue is whether the employer unreasonably refused to rehire the employe in violation of section 102.35 (3), Stats.

The Commission has carefully reviewed the entire record in this matter and hereby affirms the Findings and Order of the Administrative Law Judge, except as herewith modified:

MODIFIED FINDINGS OF FACT

Delete the tenth and eleventh paragraphs of the Administrative Law Judge's Findings of Fact and substitute the following paragraphs therefor:

"The applicant contended that the employer, by offering the most recent die room job to a less senior worker, unreasonably refused to rehire him within the meaning of section 102.35 (3), Stats. He argued that the provision of the collective bargaining agreement, allowing an exception from the rule prohibiting re-bidding within six months of a successful bid "with specific management approval," made it possible for the employer to give him that job. The employer justified its failure to give the applicant the position by reference to the collective bargaining agreement provision prohibiting re-bidding, and to its practice under that agreement of allowing exceptions only to the extent of permitting persons re-bidding within six months to be considered but only at the bottom of the bidder's list. The employer was obviously concerned that it could be considered a violation of the collective bargaining agreement for it to vary from its past practice by allowing the applicant to have the position when another person, not disqualified by the six month re-bidding rule, had also bid on the position. The employer specifically asked the union if it would file a grievance under the collective bargaining agreement on behalf of this other person, if the applicant were given the job, and the union would not assure the employer that it would not file a grievance in such a situation. "

In Lingle vs. Norge Division of Magic Chef, Inc. , 486 U.S. 399, 100 L. Ed. 2d 410, 108 S. Ct. 1877 (1988), a case arising out of an employe's lawsuit against her employer alleging that she was fired in retaliation for filing a claim for worker's compensation benefits, the United States Supreme Court held that application of state law is preempted by section 301 of the Labor Management Relations Act of 1947, 29 USC Section 185 (which vests jurisdiction in federal courts for lawsuits alleging breach of a collective bargaining agreement), if such application requires interpretation of a collective bargaining agreement. It has been noted that to the extent that evaluation of a claim under section 102.35 (3), Stats. would require an interpretation of a collective bargaining agreement, Lingle indicates that the 102.35 (3) claim would be preempted by federal law. Neal and Danas, Jr., Worker's Compensation Handbook (3d Edition 1990) section 7.29, page 7-16; Universal Foods Corporation vs. LIRC and Damato (Milwaukee County Circuit Court, Case No. 89-CV-014059, July 10, 1990). This is such a case. Evaluating the employe's claim and the employer's defense in this matter would inescapably require interpretation of the language of the collective bargaining agreement, and of the past practice of the parties in the application of the agreement, which is "equally a part of the collective bargaining agreement although not expressed in it," United Steel Workers of America v. Warrior and Gulf Navigation Company, 363 U.S. 574, 4 L. Ed. 2d 1409, 80 S.Ct. 1347 (1960). Application of state law is preempted under these circumstances, and the application must therefore be dismissed."

NOW, THEREFORE, the Labor and Industry Review Commission does

O R D E R

That the findings and order of the Administrative Law Judge are hereby affirmed.

Dated and mailed January 22, 1991
ND � 7.27

/s/ Kevin C. Potter, Chairman

/s/ Carl W. Thompson, Commissioner

/s/ Pamela I. Anderson, Commissioner

MEMORANDUM OPINION

The Commission has modified the decision of the Administrative Law Judge, to rest the dismissal of the application on the grounds of preemption rather than on the merits, as a matter of law. As discussed above, the Department's jurisdiction is preempted when evaluating a claim of unreasonable refusal to rehire unavoidably requires interpretation of the collective bargaining agreement. The reasonableness of the employer's grounds for not hiring the applicant here could not be determined without deciding the correctness of its position under the collective bargaining agreement.

There may be cases in which an employer's assertion that it has refused an employe rehire because of a collective bargaining agreement, can be rejected by way of a credibility-based determination that the employer does not even believe in good faith that its action is really [*5] defensible under the agreement: in such cases the refusal to rehire can fairly be called unreasonable and interpretation of the agreement will not be required. However, where the employer asserts a colorable contract defense which cannot be rejected in this fashion, interpretation of the agreement will be required to determine if the defense is meritorious. The employer's good faith belief that it is meritorious will not make the refusal to rehire "reasonable" if the employer is wrong and the collective bargaining agreement does not prevent the rehire. Therefore, because interpretation will be required, jurisdiction will be preempted.

cc:
Attorney Anthony W. Wellhouse
Attorney Robert Torgerson

110 - CD5600

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