Lourdes Med. Ctr. of Burlington Cty. v. Bd. of Review, 2009 WL 196149 (N.J. Sup. Ct., January 27, 2009) – The New Jersey Supreme Court recently upheld the decision to award unemployment compensation benefits to 240 striking nurses, concluding there was no “stoppage of work” where the hospital continued to operate at full service.  

Pursuant to N.J.S.A. 43:21-5(d), an individual is disqualified from receiving benefits if his or her unemployment is due to a stoppage of work occurring as a result of a labor dispute at the place of employment. “Stoppage of work” is defined as “a substantial curtailment of work which is due to a labor dispute.” An employer is considered to have a substantial curtailment of work if not more than 80 percent of the normal production of goods or services is met.  

The New Jersey Supreme Court rejected the employer’s argument that loss of revenue should be considered in determining whether a stoppage of work exists. “The very purpose of a strike is to inflict sufficient financial pain on an employer to accomplish the goal of the striking workers.” According to the court, the “stoppage of work” test is clearly directed at the employer’s operations, not the financial harm suffered by the employer, and the financial impact of a strike on the employer should therefore not be a material factor in determining whether a stoppage of work has occurred.