HOUSE BILL REPORT

HB 445

BYRepresentatives Wang, Jacobsen, Sayan, R. King, Lux, Wineberry, Brekke, Fisher, Niemi, Leonard, P. King, Dellwo, Cole, Basich, Heavey, Unsoeld and Todd

Authorizing unemployment compensation for certain locked-out workers.

House Committe on Commerce & Labor

Majority Report:     The substitute bill be substituted therefor and the substitute bill do pass.  (7)

     Signed by Representatives Wang, Chair; Cole, Vice Chair; Fisch, Fisher, R. King, O'Brien and Sayan.

Minority Report:     Do not pass.  (4)

     Signed by Representatives Patrick, Sanders, C. Smith and Walker.

House Staff:Chris Cordes (786-7117)

AS REPORTED BY COMMITTEE ON COMMERCE & LABOR FEBRUARY 5, 1987

BACKGROUND:

An employee who is unemployed due to a stoppage of work that exists because of a labor dispute at the employee's workplace is disqualified from receiving unemployment compensation benefits.  The Washington State Supreme Court has held that the term "labor dispute" includes the lockout of employees by an employer when the lockout results from a controversy over wages, hours, work requirements, fringe benefits, working conditions or other terms of employment.

The disqualification from benefits does not apply if (1)  the employee is not participating in, financing, or directly interested in the labor dispute that caused the stoppage of work; and (2) the employee does not belong to a grade or class of workers that were working immediately prior to the start of the labor dispute and are participating in, financing, or directly interested in the dispute.

SUMMARY:

SUBSTITUTE BILL:  An employee is not disqualified from unemployment compensation benefits if the unemployment is due to a lockout by the employer and the employee's collective bargaining agent has notified the employer that the employees are willing to return to work, pending the ratification of a new collective bargaining agreement, under the terms of the employer's last offer prior to the lockout.  However, the employees are not required to be willing to return to work if the last offer represented a substantial deterioration of the terms and conditions of employment that existed prior to the expiration of the last collective bargaining agreement.

Benefits paid to an employee due to a nondisqualifying lockout for weeks of unemployment prior to the act's effective date are not charged to the experience rating account of any base year employer.

The Employment Security Department is directed to report the number of claimants receiving benefits and the total amount of benefits paid under the act to the Commerce and Labor Committees of the Senate and House of Representatives by January 1, 1989.

Retrospective application to November 16, 1986, is specified.

SUBSTITUTE BILL COMPARED TO ORIGINAL:  The provision is deleted that created an exception for lockouts by employers who are members of a multi-employer bargaining unit.  (Employees locked out during a dispute with an employer who is a member of a multi-employer bargaining unit would receive unemployment benefits if the other conditions are met. Nonstriking, nonparticipating locked out employees are eligible for benefits under current law.)

An alternative qualifying provision for employees who take a new job after the lockout and are laid off from the new job is deleted. (Employees who take a new job are eligible for benefits under current law if the department determines that the new job severed the old employment relationship.)

The provision is deleted that pooled all the cost of benefits paid to locked out employees.  A provision is added that allows pooling of costs but limits the pooling to the benefits paid to locked out employees for weeks of unemployment prior to the effective date of the act.

The retrospective application of the act is changed from July 1, 1986, to November 16, 1986.

Fiscal Note:    Requested February 5, 1987.

Effective Date:The bill contains an emergency clause and takes effect immediately.

House Committee ‑ Testified For:     Bob Dilger, Washington State Building and Construction Trades Council; Al Brisbois, Washington State Labor Council; Sandy Baker; Bill Hansford; John Thorne; and Tom Lewiston.

House Committee - Testified Against: Clif Finch, Association of Washington Business; and John Hayes, Lockheed Shipbuilding Company.

House Committee - Testimony For:     Locked out workers who are willing to return to work during the course of labor negotiations but who continue to be locked out by the employer are not voluntarily unemployed.  Unemployment compensation should be paid to these workers because they have been forced off the job.

House Committee - Testimony Against: The state should not be involved in determining the course of a labor dispute.  The employer has the right to use a lockout to protect the company and as an economic weapon during the dispute.  Paying unemployment benefits to locked out workers would upset the balance determined under national labor relations law.