Nederhood v. Cadillac Malleable Iron Co.

Boyle, J.

(concurring in part and dissenting in part). I concur in the reasoning and result of parts i and n of the lead opinion and in the result in part iv. I write separately for two reasons.

I disagree with the conclusion of the lead opinion that, as a matter of law, the hiring of permanent replacement workers cannot serve as a withdrawal of favored work. I would hold that the hiring of permanent replacement workers may in fact and in law work to withdraw an employer’s *260offer of favored work. Therefore, I would remand for further proceedings consistent with this opinion. I disagree with reaching and disposing of an issue not properly before this Court, namely, the adoption of a reasonable time limitation on an employee’s ability to reestablish his right to favored work. The reach is unwarranted, and, in my view, the rule suggested is unjustified. If there is a justification for a rule that appears to provide an incentive to employers either to delay the settlement of a strike or to hire permanent replacement workers, it has not here been made by the employer, and the lead opinion should not provide it.

I

In March 1982, four months after the strike began, Cadillac Malleable acknowledged that the replacement workers it had been hiring were permanent. The employees who had been on favored work before the strike may have viewed Cadillac’s announcement as a revocation of favored work positions. If a revocation could be proven to have occurred, the employees, would be entitled to resumption of benefits because the justification for the suspension (voluntary cessation from available favored work) would cease to exist. Ante at 254; Kolenko v United States Rubber Products, Inc, 285 Mich 159; 280 NW 148 (1938). Nonfavored-worker strikers are presumed to be unemployed following the employment of permanent replacements. Plymouth Stamping v Lipshu, 436 Mich 1; 461 NW2d 859 (1990). The lead opinion distinguishes favored-worker strikers from other strikers because the employer either must pay benefits or employ the worker within restrictions. From this distinction the lead opinion concludes that "the rules for placing the burden of establishing a *261readiness to offer or accept favored work should be the same as would obtain had there been a voluntary cessation of favored work outside a labor dispute . . . Ante at 254. Put plainly, the lead opinion would hold that the burden is on the employee to offer to return to work.

While the lead opinion is correct in its assertion that the effect on favored-worker strikers and nonfavored-worker strikers of hiring permanent replacements is not identical, I do not agree with its conclusion that, as a matter of law, the hiring of such workers can never serve as a de facto withdrawal of the employer’s offer of favored work. It is true that the threat to the latter worker is to the benefits sought by the union and to the possibility of permanent job loss. The threat to the favored worker, however, as this case illustrates, is the elimination of both the worker’s job and benefits until such time as it is definitively determined that the strike is over or a reasonable time has passed.1 Where, as here, there is a relatively high concentration of favored workers in the work force and the labor dispute is protracted, the proposed holding of the lead opinion, when combined with the reasonable time limitation, would improve the employers’ bargaining leverage or encourage extension of the labor dispute and strikebreaking.

In Plymouth Stamping v Lipshu, the question was whether the labor disqualification provision of the Michigan Employment Security Act, MCL 421.29(8); MSA 17.531(8), applied to striking workers who had been permanently replaced. In a plurality opinion, four members of the Court held "that any striker who is permanently replaced is thereby entitled to benefits from that time forward *262unless and until some succeeding event again renders the labor dispute a substantial contributing cause of the unemployment.” Id. at 42 (opinion of Boyle and Cavanagh, JJ., concurring). My own view was that

[t]he fundamental assumption of the labor dispute disqualification provision is that there exists a job from which the striking employee has voluntarily absented himself because of a labor dispute and to which he will return at the end of that dispute. When, however, the striking employee is notified that his position has been filled — that he has been permanently replaced by another employee — that assumption no longer obtains. In the language of the statute, once the striker has been permanently replaced, his unemployment ceases to be "due to” the strike. At that juncture, the only "substantial contributing cause” [citations omitted] of the striker’s unemployment is his permanent replacement. [Id. at 38.]

Like the workers in Lipshu, the striking workers in this case may well have viewed permanent replacement workers as eliminating their positions, and the cause of the injured employees’ failure to perform favored work might have been not a voluntary refusal, but a corporate revocation. While the nature of a favored work position might make this supposition more or less tenable,2 the fact that some favored workers could reasonably view the hiring of permanent replacements as the end of their employment counsels against adoption of the rule suggested by the lead opinion, which would require these employees to attempt to return to jobs they believe are no longer available.

*263Mere reliance on the possible availability of benefits if the offer of favored work is eliminated does not justify placing a burden on the plaintiff to return to the employer asking for favored work. In my view, it is reasonable to conclude that, if the employer can be shown to have revoked its offer of favored work with the hiring of permanent replacements, then, as in Lipshu, the cause of a worker’s unemployment is no longer due to the strike.3

What is not clear in this case is whether Cadillac’s act of hiring permanent replacement workers served to withdraw its offer of favored work. The wcab held that the hiring of replacement workers was not a de facto withdrawal of favored work. However, it did not have the benefit of the Lipshu analysis.4 Moreover, it is not obvious from the opinion whether the board understood that the hiring of permanent replacements could serve to withdraw an offer of favored work. Although the board may have considered the possibility and rejected it, such a decision is not explicit in the wcab’s opinion. The wcab also seemed to place the *264burden of coming forward and the burden of proof on the plaintiff. It is likewise unclear where the burden would have been placed had it been understood that this Court would recognize application of the Lipshu analysis to the striking favored-work employee.

In the absence of a full evaluation by the administrative agency charged with implementing worker’s compensation law,5 it is inappropriate to resolve the question whether the hiring of permanent replacement workers ended plaintiff’s voluntary refusal to perform favored work. While I acknowledge again that the analogy between worker’s compensation benefits and unemployment benefits is not perfect, the permanent replacement issue is so important that the Court should not act without a full record development and discussion of the rationale and effect of the holding of Lipshu on favored workers on strike.

I would vacate the decision of the Worker’s Compensation Appeal Board and remand this case to the Worker’s Compensation Appellate Commission to assign the case to a magistrate for further consideration consistent with this opinion. On remand, the magistrate should be directed to consider the existing record and be authorized, with*265out limitation, to consider any motions by the parties concerning the possible submission of additional proofs.

II

The lead opinion observes that an employee’s willingness to return to work "should be expressed within a reasonable period in order to be effective.” Ante at 250. Because it does not decide whether a reasonable time has passed in this case, ante at 255, n 25,6 the discussion of a reasonable time limitation is dicta. While it is unnecessary to address this question in today’s opinion,7 because it is discussed, I state my opposition to the adoption of the reasonable time limitation formulated by the lead opinion.

Favored work is a judicially created doctrine, "[t]he primary purpose” of which is to allow an employer the opportunity to reduce work-loss damages by putting a partially disabled employee back to work. Bower v Whitehall Leather Co, 412 Mich 172, 182; 312 NW2d 640 (1981). The favored work doctrine also "encourages the employee to return to productive employment rather than to remain idle, thus also serving a rehabilitative function.” Id. However, the rehabilitative function is merely incidental, with each employer deciding whether to offer an individual employee favored work. Whether an employee will have the opportunity to rehabilitate is a decision left to his employer. In any event, the employer owes an employee the same minimum level of compensation whether he performs favored work or remains at home.

*266It is therefore surprising that the lead opinion would determine that "fairness,” ante at 250, requires the adoption of the reasonable time limitation. Fairness is not offended when the employee takes away an employer’s ability to reduce worker’s compensation losses that do not exist. While the worker refuses favored work, the employer is relieved of its obligation to pay that employee. There are no damages to mitigate. Fairness is also not offended by the employee’s loss of an opportunity to rehabilitate. With rehabilitation existing at the discretion of an employer who is under no obligation to offer favored work, it can hardly be argued that the desire to rehabilitate injured workers justifies cutting off future rights to worker’s compensation benefits or favored work.

The only remaining justification is a generalized concern that it is somehow unfair to require employers "to hold favored positions open indefinitely.” Ante at 250. However, the nature of favored work itself, as described by Cadillac Malleable’s attorney at oral argument, provides the clearest rejoinder to this argument:

—By its very nature, favored work is work outside or different from the work that is offered to the general work force. It is work created or established by the employer to accommodate an injured employee’s limitation. It can be an ordinary job that has been assigned the employee to accommodate his limitations.

—The question here is not whether plaintiffs’ favored work was replaced, because preferred favored work could not have been replaced. It was especially established to accommodate the injured worker.8

Under the current system, an employer is re*267quired to pay an injured employee worker’s compensation if it does not offer a favored work position within the employee’s limitations. Bower, supra at 182. If such an offer is made, the employee is required to accept it or face discontinuation of benefits. Consequently, when an employee fails to avail himself of favored work, the employer gains because it is relieved of the obligation either to pay that employee his worker’s compensation benefits or to offer him favored work. For instance, when an injured employee does not present himself to his employer for ten years, the employer gains because he was relieved of an obligation to pay owed benefits or offer favored work for that period. The "reasonable time” limitation would present employers with a windfall by turning a judicially created doctrine of mitigation into a judicially created doctrine of benefit elimination.9

Cavanagh, C.J., and Mallett, J., concurred with Boyle, J.

See part II.

For instance, odd-lot jobs would seem to be less likely to be filled by permanent replacements. Conversely, jobs that happen to fall within a favored worker’s restrictions, but would exist absent that particular favored worker, seem more likely to be filled by a permanent replacement.

See Liberty Mutual Ins Co v Neal, 140 Ga App 585; 231 SE2d 574 (1976), and Coats & Clark, Inc v Thompson, 166 Ga App 669; 305 SE2d 415 (1983), for the proposition “that the fact of the job’s becoming unavailable has the effect in itself of stopping the suspension, on the theory that the reason for claimant’s unemployment from that point on is no longer his refusal of the job but its unavailability.” 1C Larson, Workmen’s Compensation, § 57.66(c), p 10-492.76.

The wcab held:

We do not find the hiring of replacement workers to constitute a de facto withdrawal of the offer of favored work. Mr. Weikel testified that there were approximately 80 members of the bargaining unit in the plant when the strike was called. Only 41 or 42 of those employees had been replaced by replacement workers as of the hearing in this matter, held in March 1983. There was no showing that plaintiff’s job had been filled by a replacement worker or that it was unavailable to him for any other reason, such as relocation of the plant .... [1989 WCABO 471, 487.]

This Court accords "deference to the ' "construction placed upon statutory provisions by any particular department of government for a long period of time Ludington Service Corp v Acting Comm’r of Ins, 444 Mich 481, 491; 511 NW2d 661 (1994). See also Owosso Union School Dist Bd of Ed v Goodrich, 208 Mich 646, 652; 175 NW 1009 (1920):

While not controlling, the practical construction given to doubtful or obscure laws in their administration by public officers and departments with a duty to perform under them is taken note of by the courts as an aiding element to be given weight in construing such laws, and is sometimes deferred to when not in conflict with the indicated spirit and purpose of the legislature.

The wcab held that "[p]laintiff’s refusal of favored work continued through the date of hearing, thus no benefits are ordered.” 1989 WCABO 471, 488.

This issue was not addressed in the grant order in either case.

See Welch, Worker’s Compensation in Michigan: Law & Practice (rev ed), § 10.11, p 10-14.

Although I disagree with the reasonable time limitation rule suggested by the lead opinion, I would not foreclose consideration of appropriate circumstances in which it might be found that an employee had forfeited his right to reapply for favored work or benefits. This issue is not before us.