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Miko v Wyandotte Cement, Inc 4.11

Section 48

REMUNERATION, Lay-off pay, Collective Bargaining Agreement

CITE AS: Miko v Wyandotte Cement, Inc., No. 82-233794-AE, Wayne Circuit Court (February 8, 1983).

Appeal pending: No

Claimant: David Miko

Employer: Wyandotte Cement, Inc.

Docket No: B81 07873 78457

CIRCUIT COURT HOLDING: A lay-off payment constitutes separation pay and is not remuneration under the Act.

FACTS: The claimant received a lay-off allowance pursuant to the Collective Bargaining Agreement equivalent to one week's wages.

DECISION: The claimant is eligible for benefits for the period covered by the lay-off allowance.

RATIONALE: "Separation pay may stem from a collective bargaining agreement or an individual contract between the employer and employee," Gaydos v White Motors Corp., 54 Mich App 143.

"[B]efore an individual will be deemed to be unemployed, two requirements must be met. First, no service may be performed for the employer and second, no remuneration may be paid. ... That [claimant] did not perform any work for his employer is clear; however [claimant] had received an allowance from his employer pursuant to the collective bargaining agreement. The allowance that [claimant] received was labeled lay-off pay.

"Separation pay is not payment for past wages earned, but rather is considered recognition of services rendered. If the allowance was simply remuneration for past services, then a claimant having earned it, would be entitled to it, regardless of the reason for separation.

"[I]t is the court's opinion that the lay-off payment constituted separation pay and therefore falls within the Section 48 exemptions from remuneration. The payment served as compensation for job loss in recognition of past employment and not as remuneration for past services rendered."


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