In re the Claim of George

This controversy arises out of a nationwide strike of the General Motors plants called by the United Automobile Workers on October 2, 1958. Although the nationwide strike was settled by agreement within 24 hours, the national settle

The Appellate Division was correct insofar as it stated that the only issue is “ the very narrow question of when the strike or industrial controversy terminated within the meaning of subdivision 1 of section 592 ”, but erred, in our view, in attributing a vicarious voluntariness to the post-settlement unemployment on the ground that, when they commenced the strike, the claimants ought to have foreseen the consequences of idleness in some plants of an integrated industrial enterprise. The statute in question expressly limits such considerations to single “ establishments ”. There can be little doubt that, under our cases, delays caused by lack of parts and supplies from other idle plants are no part of the termination of an industrial controversy in an establishment that has settled its own controversy.

The denial of benefits where unemployment results from a dispute “ in the establishment in which [the claimant] was employed ” is strictly limited by Matter of Ferrara (Catherwood) ( 10 N Y 2d 1 ) to the geographic location of the employment regardless of what the Appellate Division correctly recognized here as a highly integrated nationwide industry (see, also, Matter of Machcinski [Ford Motor Co.— Corsi], 277 App. Div. 634 ). In the face of the Ferrara case it cannot be said that the several plants involved in this case constitute a

The second branch of this appeal questions the Appellate Division’s affirmance of the Unemployment Insurance Appeal Board’s determination that the motor plant, forge and foundry at Tonawanda was one establishment. The controlling decision is Matter of Ferrara (Catherwood) ( 10 N Y 2d 1 , supra) which held that geographic unity is the primary and ordinarily decisive factor in determining the existence of an establishment under subdivision 1 of section 592. It is simply a question of applying the standard to the physical plant at Tonawanda. This seems to us to be the sort of question as to which the administrator’s choice should be given great weight. Although the three divisions are represented by different local unions of the United Automobile Workers, with different collective bargaining agreements, the facilities occupy a single tract of about 150 acres and are surrounded by a single 6-foot steel fence. Each has separate personnel records and each has a separate cafeteria. On the other hand, they are served by a single power house, water pumping station, sewage disposal, electric and compressed air facilities. The administrative structure seems to tend to separateness while physically and spatially it is

Lastly, respondent argues that the individual strike settlements cannot be regarded as terminating the strikes in each establishment because of paragraph 118 of the national collective bargaining agreement between General Motors and the International Auto Workers, which states: “ The Union has requested this National Agreement in place of independent agreements for each bargaining unit covered hereby. Accordingly an authorized strike in one bargaining unit under this Agreement which results in an interruption of the flow of material or services to operations in any other bargaining unit under this Agreement, will be considered an authorized strike in any such affected bargaining unit.” It is argued that this provision means that the strike settlements that were reached at each establishment were without effect in settling the strike at such establishments so long as the interruption in the flow of essential parts held up actual operation. Cases such as Ford Motor Co. v. Huffman ( 345 U. S. 330 ) and Allis-Chalmers Mfg. Co. v. National Labor Relations Bd. ( 213 F. 2d 374 ) are cited to show how the provisions of a collective bargaining agreement may override inconsistent mandates of law. For instance, in Huffman, an agreement dealing with veterans’ seniority rights was held binding even though it derogated from the statutory rights of returning veterans as set forth in Federal law.

Assuming arguendo that the provision was intended to have the effect now argued by respondent, it cannot do so under our law. Cases dealing with a conflict between a contract and a statute covering conditions of employment are not controlling. The statute may there be rightly regarded as applicable only in the absence of a contrary agreement. Here, however, conditions of employment are not involved. We are asked to hold that the benefits otherwise due the unemployed were bargained away. In respect of social legislation designed to benefit those whom the Legislature deems in need of assistance, it is asking a great deal to have us displace the legislative determination of the needy class to conform to a prior private agreement —

To summarize, we believe that, where an industrial dispute is in fact settled by agreement within the unit defined by statute as an establishment, the policy of the statute is called into play notwithstanding the national agreement’s characterization of the continued work stoppage as “an authorized strike ”. The stoppage is in fact due to disputes at other establishments, and labels notwithstanding, that sort of reason for unemployment is not regarded by our law as a sufficient cause for denying benefits.-

The constitutional argument raised by respondent is quite without merit. Laws pre-existing the formation of a contract and limiting its effectiveness do not “impair its obligation” within the constitutional prohibition (West Const Hotel Co. v. Parrish, 300 U. S. 379 ). As to the argument under the supremacy clause (U. S. Const., art. VI, § 2) that section 592 invalidly regulates interstate commerce, it is sufficient answer to say that the constitutionality of our unemployment insurance law has been upheld (Chamberlin, Inc., v. Andrews, 159 Misc. 124 , mod. 271 N. Y. 1 , affd. 299 U. S. 515 ; Standard Dredging Co. v. Murphy, 319 U. S. 306 ) and the power to provide for payment of benefits and taxation of employers must carry with it the power to regulate, according to our own lights, eligibility for payments.

The order of the Appellate Division should be modified by reversing so much thereof as reversed the determination of the Unemployment Insurance Appeal Board' and the determination of the board reinstated, with costs in this court and in the Appellate Division to the Industrial Commissioner against

Chief Judge Desmond and Judges Dye, Fuld and Scileppi concur with Judge Burke; Judge Van Voorhis dissents and votes to affirm; Judge Bergan taking no part.

Order modified, etc.