BOSTON (AP) _ The Massachusetts Appeals Court on Wednesday overturned a decision that granted unemployment compensation benefits to Hertz Corp. employees who walked off the job in 1996.

Hertz had appealed the award of unemployment benefits to 130 employees, arguing that a ``stoppage of work,'' as defined under state law, disqualifies workers from receiving benefits.

The Division of Employment and Training and a review board of the Department of Labor and Workforce Development had found that under the law, there was no stoppage of work during the six-week strike, and determined that the workers were therefore not disqualified from receiving unemployment benefits.

The Appeals Court, however, found that the review board applied the wrong criteria when it determined there was no work stoppage.

During the strike, Hertz management employees and other employees not affected by the labor dispute conducted operations usually done by members of the International Brotherhood of Teamsters Local 25.

As a result, there was no reduction in the number of rentals Hertz made and no decrease in revenues during the strike period.

But the Appeals Court found that there was a work stoppage because Hertz experienced a substantial reduction in market planning, fleet management, accounting, budgeting, maintenance and other functions.

``It's an important ruling because it correctly, we think, interprets the law with respect to the definition of a work stoppage,'' said Richard Broome, a spokesman for Hertz, based in Park Ridge, N.J.