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Docket No. 97695-Agenda 30-September 2004.
INTERNATIONAL UNION OF OPERATING ENGINEERS,
LOCAL 148, AFL-CIO, Appellee, v. THE ILLINOIS
DEPARTMENT OF EMPLOYMENT SECURITY et al., Appellants.

JUSTICE FREEMAN delivered the opinion of the court:

At issue in this appeal is whether the members of the InternationalUnion of Operating Engineers, Local 148, AFL-CIO, are entitled tounemployment compensation benefits for the period of time betweenJune 22, 1993, and August 28, 1993. The appellate court ruled thatthe members of Local 148 were eligible for benefits. 345 Ill. App. 3d382. The Illinois Department of Employment Security (Department),and the employer, Central Illinois Public Service Company (CIPS),filed a petition for leave to appeal. 177 Ill. 2d R. 315. We granted thepetition, and now reverse.

BACKGROUND

CIPS is a public utility furnishing electricity and natural gas toresidential and commercial customers in portions of central andsouthern Illinois. CIPS operates three natural gas distribution divisionsdesignated as the Eastern, Southern and Western divisions. CIPS alsooperates five electricity power generating plants known as theNewton, Coffeen, Meredosia, Hutsonville, and Grand Tower stations.Local 148 (hereinafter, Engineers' Union) represents approximately549 production and maintenance employees at the Coffeen,Meredosia, Hutsonville, and Grand Tower facilities. The InternationalBrotherhood of Electrical Workers, Local 702, representsapproximately 950 production, maintenance and operation employeesat the Newton power station and the Eastern, Southern and Westerndivisions. Local 702 also represents 12 workers in the productiondepartment at the Grand Tower station, with these employeesincluded in the Southern division bargaining unit. Each power stationand division is covered by a separate collective-bargaining agreement.

On June 30, 1992, the collective-bargaining agreements betweenCIPS and the unions expired. CIPS and the unions agreed to a seriesof contract extensions. In March 1993, CIPS presented "final"contract proposals to the unions, which both unions rejected. CIPSmanagement discussed the possibility of a lockout at several meetings,the earliest being a meeting on April 15, 1993. At the expiration of thelast contract extension on April 24, 1993, union members began toadhere strictly to company safety and other rules, and to refusevoluntary over-time work. Although CIPS and the unions continuedto meet, holding negotiation sessions on May 14, 17, and 18, 1993,CIPS made a decision on or about May 7, 1993, to lock out itsemployees. At 4 a.m. on May 20, 1993, CIPS instituted a lockout ofall members of the two unions.

The negotiations between CIPS and the unions continued duringthe lockout. On June 14, 2003, CIPS and Engineers' Union reacheda tentative agreement on the terms of a new contract. The membersof Engineers' Union ratified the contract on June 17 and 18, 1993,and CIPS and Engineers' Union signed the contract on June 21, 1993.CIPS ended the lockout of the members of Engineers' Union on June22, 1993. Although eligible to return to work, the members ofEngineers' Union respected the picket lines established by themembers of Local 702 and stayed off the job. On August 25, 1993,CIPS announced that it was ending the lockout of the members ofLocal 702, even though CIPS and Local 702 had not reachedagreement on new contracts. The members of both unions returned towork on August 28, 1993. Negotiations continued between CIPS andLocal 702, and in January 1994, CIPS and Local 702 reachedagreement on new contracts.

During the lockout, members of both unions applied forunemployment compensation benefits. On June 11, 1993, aDepartment claims adjudicator determined that the union memberswere not eligible for benefits because their total or partialunemployment was due to a stoppage of work which was in turncaused by a labor dispute at the facility at which they were lastemployed. The unions appealed the claims adjudicator's decision. OnAugust 18, 1993, the Director's representative notified all unionmembers that the unions proposed to represent them in a consolidatedappeal, and allowed each member 10 days to object to consolidationand/or representation by union attorneys. Sixty-six union memberschose to be represented by a nonunion attorney. Thirteen additionalunion members objected to both consolidation of the appeals andrepresentation by union attorneys.

Also in August 1993, Engineers' Union moved to sever from theproceedings issues pertaining to the eligibility of its members toreceive benefits starting June 21, 1993, the date CIPS and Engineers'Union entered into the new contract. Engineers' Union sought anadministrative determination that its members were eligible forunemployment compensation beginning on June 21, 1993. CIPSobjected to the motion to sever, arguing that the unemployment ofmembers of Engineers' Union and Local 702 arose out of the samework stoppage caused by the same labor dispute involving the sameemployer. The Director's representative denied the motion to severand consolidated the appeals because the issues to be decided involvedcommon questions of fact and law.

On January 11 and 12 and May 3 and 4, 1994, the Director'srepresentative conducted a hearing on the appeals from the claimsadjudicator's decision. Subsequently, on January 3, 1995, theDirector's representative recommended that the determination of theclaims adjudicator be set aside, and that the union members be foundeligible for benefits for the period from May 20, 1993, through August28, 1993, subject to recoupment. The Director's representative basedhis recommendations on principles of federal preemption. The unionshad filed claims with the National Labor Relations Board (NLRB),contending that CIPS had violated the National Labor Relations Act(29 U.S.C.