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Employment Sec. Commission v. Magma Copper Co.

Supreme Court of Arizona

November 8, 1961

MAGMA COPPER COMPANY, a corporation, Appellee.

In Banc.

Page 85

[90 Ariz. 105] Robert W. Pickrell, Atty. Gen., Wade Church, former Atty. Gen., and Richard J. Daniels, Asst. Atty. Gen., for appellant.

Guynn, Twitty & Sievwright, and John F. Mills, Phoenix, for appellee.

UDALL, Justice.

This is an appeal from a final order of the Superior Court of Pinal County reversing a determination by the Employment Security Commission that claimants, Francisco Ruiz, Gumercindo Provencio and Jose M. Lugo, were entitled to unemployment insurance benefits pursuant to A.R.S. §§ 23-771 to 23-790 (1956). Presented here is he question whether a worker, forced to retire on pension at age 68 or above at the instance of his employer but according to the provisions of a collective bargaining agreement 'has left work voluntarily without good cause in connection with his employment' so as to disqualify himself for benefits to the extent provided in A.R.S. § 23-775(1). [1]

The facts were submitted on an agreed statement to the Superior Court and on review by this court are stipulated to be as follows. Claimants were employed by the Magma Copper Company in the unit for which the International Union of Mine, Mill & Smelter Workers, Independent had been certified by the National Labor Relations Board as bargaining agent in October of 1957. Provencio and Ruiz were members of the Union and Lugo, though nor a member, was entitled to belong. In June of 1958 the Company, the Union and its Local No. 938 entered into a collective bargaining agreement providing for, inter alia, a pension plan. This plan provided in pertinent part:

'2.1 Retirement on Account of Age

(a) Normal. On or after January 1, 1958, each Employee shall retire from the service of the Employing Company on his normal retirement date, which [90 Ariz. 106] shall be the first day of the month on or next following his 65th birthday; provided, however, that the Employee may postpone his retirement and continue in service up to three (3) years after his normal retirement date if he so desires and if and so long as he is able in the opinion of the Employing Company to perform the work available for him; and provided further that the Employee, upon written request of the Employing Company, may if he so desires, continue in service after his 68th birthday. No employee who retires on account of age shall become a Pensioner unless he has completed fifteen (15) or more years of Continuous Service to his actual retirement date.'

The agreement in its entirety was ratified by the members of Local No. 938.

Page 86

Each of he claimants was over 65 and had worked continuously for the Company for 15 years or more at the time the plan was adopted in June of 1958. And each was requested by the Company to work past his 68th birthday. However, the Company terminated the employment of Ruiz and Provencio on August 31, 1958, and that of Lugo on October 1, 1958. The three were 69, 70 and 72 respectively at the time of their retirement. When so retired by the Company they 'applied for unemployment benefits and social security benefits in addition to benefits under the negotiated pension plan. Each of the three claimants stated that he would have desired to remain in the employ of the Company.'

The Employment Security Commission in affirming the findings of its Appeal Tribunal decided that:

'1. * * * The claimants separated from employment under nondisqualifying circumstances.

'2. The employer's experience rating account shall be subject to charges for benfits subsequently paid.'

On appeal the Commission's two assignments of error are that the Superior Court erred in reversing the above two findings. The Commission argues (1) that under the agreement the employer Company had the option of continuing to hire or discharge the employees and therefore, ipso facto, the claimants were involuntarily unemployed, and (2) that the collective bargaining contract, if construed as a binding agreement by claimants to be voluntarily unemployed in the future, either a designated age or at the wish of the employer, would violate A.R.S. § 23-784 which provides:

'No agreement by an individual to waive, release or commute his rights to benefits or any other rights under this chapter shall be valid.'

On the other hand appellee contends 'that the employe, through his bargaining agent, has agreed to quit work at a certain age in [90 Ariz. 107] return for a pension. Having accepted the benefits of the ...

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