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U.S. Supreme Court

Unemployment Compensation Comm'n v. Aragon, 329 U.S. 143 (1946)

Unemployment Compensation Commission v. Aragon

No. 25

Argued February 27, 1946

Reargued November 13, 1946

Decided December 9, 1946

329 U.S. 143


Companies engaged in catching and canning salmon in Alaska terminated their agreement with the union representing their employees at the end of the 1939 season. Prior to the beginning of the 1940 season, they opened negotiations in San Francisco with the same union for a new agreement. There ensued a controversy over wages which resulted in a failure to reach an agreement and a decision to conduct no operations during the 1940 season. Individuals who had worked for the companies during the 1939 season filed claims for unemployment benefits with the Alaska Unemployment Compensation Commission. The Commission held that they were disqualified from receiving payments for eight weeks under § 5(d) of Alaska Extra.Sess. L., 1937, c. 4, as amended by Alaska Sess. L., 1939, cc. 1, 51, which disqualifies an individual for eight weeks if "the Commission finds that his . . . unemployment is due to a labor dispute which is in active progress at the factory, establishment or other premises at which he . . . was last employed."


1. The Commission could properly find that a "labor dispute" existed within the meaning of § 5(d) of the Alaska Act. Pp. 329 U. S. 149-151.

2. The term "labor dispute," as used in § 5(d) of the Alaska Act, need not be narrowly construed to require a strike or leaving of employment, but may be construed as covering a situation where the controversy precedes the employment. Pp. 329 U. S. 149-151.

3. Evidence that two of the companies had made extensive preparations for the 1940 operations, purchasing equipment and supplies, preparing ships and holding them in readiness for the expedition, and that they negotiated in good faith and failed to operate only because of their inability to negotiate satisfactory labor agreements before the beginning of the season, was sufficient to support the Commission's finding that their unemployment was "due" to a labor dispute. Pp. 329 U. S. 149-151.

4. Evidence showing, inter alia, that the withdrawal of another company from negotiations with the union and its determination

Page 329 U. S. 144

not to operate during the 1940 season occurred prior to the deadline for its operations and was caused primarily by factors other than its inability to negotiate a satisfactory labor contract did not support a finding by the Commission that its employees were unemployed "due" to a labor dispute at the establishment at which they were last employed. Pp. 329 U. S. 152-153.

5. Where the negotiations continued beyond the deadline dates set by the companies for the consummation of an agreement and beyond the dates of the applications for unemployment benefits, the Commission could properly find that a labor dispute was in "active progress" within the meaning of § 5(d) of the Alaska Act, even if it be assumed that at some time within the eight-week period of disqualification the point was reached when all possibility of settlement disappeared. P. 329 U. S. 153.

(a) The question is one of specific application of a broad statutory term in a proceeding in which the agency administering the statute must determine it initially. P. 329 U. S. 153.

(b) The reviewing court's function is limited, and all that is needed to support the Commission's interpretation is that it has "warrant in the record" and a "reasonable basis in law." Pp. 329 U. S. 153-154.

6. This Court is unable to say that the Commission's construction was irrational or without support in the record, since the Commission might reasonably conclude that the unemployment was not of the "involuntary" nature which the statute was designed to alleviate. P. 329 U. S. 154.

7. The fact that, in accordance with the usual procedure, the wage negotiations were conducted in San Francisco and Seattle, instead of at the place of work in Alaska, did not prevent the dispute from being "at the factory, establishment, or other premises" within the meaning of § 5(d) of the Alaska Act. Pp. 329 U. S. 154-156.

8. A reviewing court usurps the administrative agency's function when it sets aside an administrative determination on a ground not theretofore presented and deprives the agency of an opportunity to consider the matter, make its ruling, and state the reasons for its action -- where the statute provides that judicial review is permitted only after exhaustion of administrative remedies. P. 329 U. S. 155.

149 F.2d 447 affirmed in part, reversed in part.

The Unemployment Compensation Commission of Alaska held certain employees of salmon canneries disqualified for eight weeks from receiving unemployment

Page 329 U. S. 145

compensation benefits, on the ground that their unemployment was due to a "labor dispute" within the meaning of the Alaska Unemployment Compensation Law, Alaska Extra.Sess. L., 1937, c. 4, as amended by Alaska Sess.L., 1939, cc. 1, 51. The District Court affirmed the Commission's holding. The Circuit Court of Appeals reversed. 149 F.2d 447. This Court granted certiorari. 326 U.S. 700. Affirmed in part, reversed in part, and remanded. P. 329 U. S. 156.

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