15. Labor Disputes

Baggett v. Riverside Osteopathic Hospital – 15.37

Baggett v. Riverside Osteopathic Hospital
Digest No. 15.37

Section 421.29(8)(a)(i)

Cite as: Baggett v Riverside Osteopathic Hospital, unpublished opinion of the Wayne County Circuit Court, issued February 19, 1999 (Docket No. 98-820404-AE).

Appeal pending: No
Claimant: Shelby Baggett, et al.
: Riverside Osteopathic Hospital
Docket no.: 98-820404-AE
Date of decision: February 19, 1999

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HOLDING: Claimants who were on strike had not been “permanently displaced,” and therefore a labor dispute was the cause of their unemployment, which disqualified claimants for benefits under Section 29(8)(a)(i) of the MES Act.

FACTS: Claimants went on strike May 24, 1990 and returned to work on October 19, 1990. After July 8, 1990, the employer began hiring employees who subsequently became “permanent” employees. From the date the strike began to the end of the strike, positions for the striking employees were available upon their return. Claimants were returned to their positions after the strike. During the strike, claimants applied for unemployment benefits. The Board of Review determined claimants disqualified for benefits.

DECISION: The circuit court affirmed the Board of Review’s decision, which found the claimant to be disqualified for benefits due under Section 29(8)(a)(i) of the MES Act.

RATIONALE: Section 29(8) of the MES Act reads in relevant part: “(a) An individual is disqualified from receiving benefits for a week in which the individual’s total or partial unemployment is due to either of the following: (i) A labor dispute in active progress at the place at which the individual is or was last employed, or a shutdown or start-up operation caused by that labor dispute.” The circuit court read the Michigan Supreme Court case of Plymouth Stamping v Lipshu, 436 Mich 1 (1990), to suggest that Section 29(8) means, “If there is a position open for a striking worker, he/she is ineligible for unemployment benefits.” But, if claimants were permanently displaced then the labor dispute would no longer be the cause of their unemployment, and the claimants would thus be eligible for benefits. Here, the circuit court determined that the striking employees had permanent positions to return to and and that those employees were, in fact, returned to those positions at the end of the strike. Further, these positions were available to claimants throughout the strike. Thus, the Board of Review’s conclusion that claimants were not permanently displaced was supported by substantial evidence.

Digest Author: Adam Kleven, Michigan Law, Class of 2018
Digest Updated: 3/27/2016

15. Labor Disputes

Alexander v. A.P. Parts Manufacturing Co. – 15.36

Alexander v. A.P. Parts Manufacturing Co.
Digest No. 15.36

Section 421.29(8)

Cite as: Alexander v AP Parts Manufacturing Co., unpublished per curiam opinion of the Court of Appeals, issued February  23, 1996 (Docket No. 168700).

Appeal pending: No
Claimant: David J. Alexander, Louise Anderson, Charles Arndt, Bruce Berthiaume, Wyatt Boyer, Robert Beuchel, Paul Chomas, George Clark, Richard Courtney, Cheryl Dehate, Dean Fenwick, George Fittig, and Jacob Gotfryd
Employer: A.P. Parts Manufacturing Company
Date of decision: February 23, 1996

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HOLDING: Court applied the deferential standard to the decision of the MESC Board of Review. Reversed the Circuit Court opinion and reinstated the MESC Board of Review’s decision. There exists substantial evidence on the whole record to support the board of review’s conclusion that the labor dispute was connected with the lockout. Ruling of the board of review is supported by competent, material, and substantial evidence on the whole record.

FACTS: Employer manufactures parts for the automobile and heavy truck industry and employed approximately 206 union employees and 75 nonunion employees. In October 1989, employer hired 10-12 additional employees and began to operate two shifts .In December 1989 employer issued a “WARN” letter advising its employees that some employees may be laid off if a new collective bargaining agreement was reached on or about February 8, 1990 (the date the then existing one was set to expire). On February 5, 1990, when employer determined it had sufficient inventory in the warehouse, it laid off the 10-12 nonunion employees it had hired in Oct 1989. On February 8, 1990, immediately after union employees rejected the collective bargaining agreement that the employer had proposed, the employer announced that its operation would be shut down for the next two working days due to an “inventory adjustment”. On February 13, 1990 the employer announced a “lockout” that affected all union employees. Claimants immediately began to picket. Union employees rejected a third proposal and employer ended the lockout by notifying its employees to return to work. However, 75 employees were laid off one additional week due to “lack of work”.


  • Determined that claimants were disqualified from receiving unemployment compensation because their temporary unemployment was related to a labor dispute (and the state must remain neutral in labor disputes).
  • In an evidentiary hearing, an MESC referee rejected the employer’s claim that the lockout was related to a labor dispute and hence found that claimants were entitled to unemployment benefits.

MESC Board of Review:

  • Reversed the decision of the referee two-to-one.
  • Concluded that:
    • (1) employers had “warehoused” its product in order to improve its bargaining position in the event of a labor dispute, and
    • (2) claimants were disqualified from receiving benefits under MCL 421.29(8) because the labor dispute that developed was a substantial contributing factor to the lockout.

Circuit Court

  • Reversed the ruling of the board of review

DECISION: Circuit court erred in reversing the decision of the MESC Board of Review.

RATIONALE: “Substantial evidence” means more than a mere scintilla but less than a preponderance of the evidence. So long as the MESC Board of Review selected between two reasonable positions, the judiciary must accord deference to administrative expertise and refrain from substituting its own judgment for that of the administrative agency. Court applied the deferential standard to the decision of the MESC Board of Review.

Digest author: Katrien Wilmots, Michigan Law, Class of 2017
Digest updated: 3/30/2016

10. Voluntary Leaving

Degi v Varano Glass Co – 10.19

Degi v Varano Glass Co
Digest no. 10.19

Section 29(1)(a) and 29(8)

Cite as: Degi v Varano Glass Co, 158 Mich App 695 (1987).

Appeal pending: No
Claimant: Paul G. Degi
Employer: Varano Glass Company
Docket no.: B84 09066 97679W
Date of decision: January 27, 1987

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COURT OF APPEALS HOLDING: Where an employer has promised additional compensation to a claimant for taking on new duties, the employer’s failure to provide that additional compensation constitutes good cause attributable to the employer. A worker, who is not acting in concert with other employees and is discharged after protesting wages, hours, or working conditions is not engaged in a labor dispute.

FACTS: Claimant worked in the employer’s flat glass department. On his own claimant had acquired skills in making beveled and stained glass. The employer decided to start an art glass department. Claimant agreed to work there. An increase in claimant’s wages was discussed. Claimant had a proposed employment contract prepared and presented it to the employer. Claimant spent 2 months performing tasks related to art glass work but did not receive a wage increase. Claimant advised the employer he would not continue in the art glass department without a contract. The employer advised him to continue working in the art glass department or punch out. Claimant punched out and did not return.

DECISION: Claimant is not disqualified for voluntarily leaving his employment since he had good cause attributable to the employer for leaving.

RATIONALE: “On the facts of this case, a reasonably prudent person would be justified in giving up employment. The employer’s activity would motivate the average able-bodied and qualified worker to give up his or her employment in such a situation.”

“We conclude that a worker who is not acting in concert with other employees, but rather who is individually protesting wages, hours and working conditions to his employer and who is summarily discharged, is not engaged in a “labor dispute” as that phrase is used in Section 29()[sic]. To hold otherwise would be to unduly broaden the commonly understood meaning of the phrase ‘labor dispute'”.

Digest Author: Board of Review (original digest here)
Digest Updated: 11/90