SENATE BILL REPORT

SB 5059

BYSenators Warnke, Talmadge, Bender, Rasmussen, McDermott, Fleming, Conner, Lee, Vognild, Metcalf, Zimmerman, Garrett, Bauer, Smitherman, Williams, and Wojahn; by request of Lieutenant Governor

Authorizing unemployment compensation during certain labor lockouts.

Senate Committee on Commerce & Labor

Senate Hearing Date(s):January 13, 1987; January 14, 1987; January 20, 1987; January 22, 1987

Majority Report:  That Substitute Senate Bill No. 5059 be substituted therefor, and the substitute bill do pass.

      Signed by Senators Warnke, Chairman; Smitherman, Vice Chairman; Tanner, Vognild, Williams, Wojahn.

Senate Staff:Mark McDermott (786-7429)

                  January 22, 1987

AS REPORTED BY COMMITTEE ON COMMERCE & LABOR, JANUARY 22, 1987

BACKGROUND:

Current statutes (50.20.090 RCW) deny unemployment compensation benefits to an individual who is unemployed due to a stoppage of work which was caused by a labor dispute at the place where he/she was last employed.  The term "labor dispute" is not defined by statute and the Employment Security Department is granted discretion to define labor dispute.  The Washington State Supreme Court has ruled that a lockout may be defined as a labor dispute.  Employment Security's Policy Guide For Labor Disputes states "a lockout occurs when an employer closes its door to its employees or fails to provide otherwise available work for its employees because of a controversy over wages, hours, work requirements, fringe benefits, working conditions or other terms of employment".

This "labor dispute qualification" section does not apply if both of the following conditions are met:  (1)  the individual is not participating in, financing, or directly interested in the labor dispute which caused the stoppage of work; and (2)  the individual does not belong to a grade or class of workers which were working immediately prior to the start of the labor dispute and are participating in, financing, or directly interested in the dispute.

At the present time, 20 states allow unemployment compensation benefits to individuals who are unemployed due to some or all types of lockouts.

SUMMARY:

An individual is not denied unemployment compensation benefits if the unemployment is due to a stoppage of work which is caused by a lockout.  A lockout is defined as an employer's independent action to refuse work for the purpose of compelling employees to accept terms or make concessions to the employer.

The Commissioner of Employment Security shall determine that a lockout exists if an employer:  (1)  fails to provide or announces a refusal to provide work to the employees with whom the employer has a labor dispute until the labor dispute is over; or (2)  announces that work will be available after the end of the current contract on terms and conditions which are less favorable to the employees than the current terms and conditions.

In either case, the employee's recognized bargaining agent must inform the employer that the employees engaged in the dispute are ready, able and willing to continue work pending the negotiation of a new contract.  The continued work must be at the terms and conditions which were in effect prior to the lockout or announcement of new conditions.

Fiscal Note:      none requested

EFFECT OF PROPOSED SUBSTITUTE:

An individual is not denied unemployment compensation benefits if:

      1.The unemployment is due to a lockout unless the lockout is called by members of a multi-employer bargaining unit after one employer has been struck as a result of the multi-employer bargaining process; or

      2.The individual who was unemployed due to a nondisqualifying lockout found new employment and earned wages greater than his/her suspended weekly benefit amount for at least five weeks and was subsequently laid off from the new employer; and

      3.The recognized or certified collective bargaining agent must have 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.  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 which existed prior to the expiration of the last collective bargaining agreement.

Benefits paid to an individual due to a nondisqualifying lockout are not charged to the experience rating of any contribution paying employer.

Employment Security shall report by January 1, 1989, to the Commerce and Labor Committees of the Senate and House regarding the number of claimants receiving benefits and the total amount of benefits paid under this act.

The bill contains a retroactive date of July 1, 1986.

Fiscal Note:      available

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

Senate Committee - Testified: Bob Dilger, Washington State Building Trades Council; Larry Marshall, Darigold; Clifton Finch, AWB; Mike Ryherd, Teamsters; Larry Kenney, Washington State Labor Council; Larry Stevens, NECA; Steve Cuddy, Laborers Union; Vince Rota, Employer Advisory Services