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Subject Matter Jurisdiction to Hear Labor Disputes

Walczak v. Labor Works-Fort Wayne, LLC (Ind. Ct. App. March 5, 2012)

This case involved a claim for unpaid wages filed by an employee against a temp agency. The determinative issue was whether the employee’s action fell under the Wage Payment statute, which applies to current employees and employees who voluntarily leave employment, or the Wage Claims Statute, which applies to employees who were involuntarily separated from employment. The Court did not reach the employee’s argument that the Wage Claim Statute applies only where an employee was fired or where the employee’s work was suspended due to a labor dispute, as the Court concluded that the trial court lacked subject matter jurisdiction. Specifically, the Court found the claim involved factual issues that should have been resolved by the Department of Labor. Thus, the Court reversed the trial court’s grant of summary judgment to the temp agency and remanded with instructions to dismiss the employee’s complaint.

This case demonstrates the importance of subject matter jurisdiction. From the text of the opinion, it appears that although Labor Works had raised the issue below, neither the parties nor the trial court focused on the issue. The Court of Appeals, however, found subject matter jurisdiction to be the dispositive issue and declined to address other potential issues. The Court also refused to affirm the grant of summary judgment in favor of the employer, as the trial court did not have jurisdiction to grant this relief. The take-away here is that if a party has a subject matter jurisdiction argument, it is important to pursue it fully, as affirmative relief granted can be vacated if the subject matter jurisdiction argument would have been successful.

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