Stiffler Unemployment Compensation Case

Opinion by

Hoffman, J.,

This is an appeal from a denial of benefits to appellants under the Unemployment Compensation Law, §401, as amended, 43 P.S. §801(f) (2).

The facts in this case as determined by the Unemployment Compensation Board of Review follow. Both appellants took excused absences from their employment due to maternity in 1966. Under company policy, such excused absences could extend up to eighteen months, unless terminated sooner by the employee. After being certified by their physicians as able to work, they reported to the employer in February 1967 (well within eighteen months of their leave). They were, however, not rehired but instead were put on a recall list, since the employer was in the process of reducing its work force at that time.

Appellants then filed ' applications for unemployment compensation benefits on March 20, 1967, and reported Aveeklv as required. These applications were denied for alleged failure to establish that appellants were unable to resume work because of a “reduction in force” by the employer.¹

In making this determination, the Board relied exclusively on the fact that when appellants returned from their leaves of absence, their employer had a greater work force than when they began their leaves.

The Board refused to consider as relevant that when appellants reapplied for work, the employer was in the process of reducing its work force by not hiring replacements for job vacancies as they arose. Moreover, the Board also failed to consider as relevant that within two months following appellants’ reapplication for work, which was also within eighteen months of their leaves of absence, the employer’s work force fell below the level it had reached in February, 1966.

The issue before us, therefore, is whether the Board erred in finding that there was no “reduction in force.”

The purpose of the Unemployment Compensation Act is to relieve employees against the distress of involuntary unemployment. As was stated in Semanisin Unemployment Compensation Case, 198 Pa. Superior Ct. 303, 305, 181 A. 2d 854 (1962), “the principal object of the unemployment compensation law is to alleviate economic distress in individual cases and to extend help to those unemployed through no fault of their own.” Thus, when as in the instant case, the Act makes compensation dependent upon whether an employee has been refused employment because of a “reduction in force” this standard must be interpreted in light of the statutory purpose.

Here, it is conceded that the appellants were refused reemployment through no fault of their own. Bather, the employer had established an across-the-board policy of refusing work to all job applicants and persons returning from leaves of absence. Thus, on December 13, 1966 during appellants’ leaves there were 1613 employees, but on the dates that appellants reapplied there were only 1577 and 1552 employees respectively. This policy was predicated on the fact that the employer sought to reduce his work force. Hence, appellants, without regard to their personal characteristics, or their desirability as employees were denied employment.

Under the terms of the Act, appellants’ failure to be rehired was the direct result of this “reduction in force.” Plainly, then, appellants fully deserved and should have been granted benefits when they applied for them. Any other result would be contrary to the legislative intent of the Act, and a gross misapplication of its provisions.

Moreover, after appellants had reapplied for work and were placed on the recall list, the employer’s work force continued to drop until it dipped below the level attained when appellants first took their leaves of absence. Under the Board’s rationale, employees who left at the same time as did appellants for pregnancy leaves of absence, but who reapplied at this point would be entitled to benefits. Appellants would not, however, because even though such time was well within eighteen months of their original leave the Board reasoned that they “terminated their leave of absence voluntarily when (they) contacted the employer regarding a return to work and under the provisions of the Law above cited this is the critical date.”

No such inequitable and arbitrary result is required by the law. As Board Member Tagliannetti’s dissent points out, other claimants who waited longer before reapplying for work were granted benefits. Appellants on the other hand, who have evidenced a genuine willingness to return to work, have in effect been penalized for wanting to return too soon, rather than waiting for a more advantageous time to reapply.

Accordingly, the decision of the Unemployment Compensation Board of Review is vacated and this case is remanded for a determination consistent with this opinion.

Montgomery, J., concurs in the result.

1 Section 401 of the Act provides: “Compensation shall he payable to any employe who is or becomes unemployed, and who . . . (f) (2) ... on leave of absence for reasons of pregnancy has earned remuneration for services performed ... in an amount equal to or in excess of four (4) times her weekly benefit rate. . . . Provided, however, That the provisions of this clause (2) shall not be applicable if the claimant (a) is unable to resume her employment . . . because of a reduction in force or because the business of such employer is closed down for reasons other than vacation. . .”