Terms of “last chance” agreement included a waiver of the employee’s right to arbitrate or litigate his subsequent termination

Terms of “last chance” agreement included a waiver of the employee’s right to arbitrate or litigate his subsequent termination.
Matter of James Schmitt v New York State Dept. of Correctional Services, 2008 NY Slip Op 00317, Decided on January 17, 2008, Appellate Division, Third Department

James Schmitt, a correction officer at the Washington Correctional Facility in Washington County, served disciplinary charges alleging “excessive absenteeism” The charges included specifications of 17 occasions when he was allegedly absent without leave” [AWOL]. The disciplinary action resulted in Schmitt’s termination but he and the Corrections signed a “last chance agreement,” which provided, among other things, that he would serve a 12-month disciplinary evaluation period. The “last chance agreement” also permitted Corrections to reinstate the original penalty of dismissal without further appeal should Schmitt “engage in conduct similar to that alleged in the notice of discipline.”

Schmitt subsequently telephoned the facility advising that he would not be at work because his wife was ill and he was taking family sick time. The next day, June 6, 2004, Schmitt was arrested and taken into custody by the City of Glens Falls Police Department. Concluding that Schmitt's arrest meant that he could not be taking care of his wife that day, nor could he report to work, respondent's Bureau of Labor Relations deemed him to be AWOL. Ultimately the Department concluded that Schmitt had violated the terms of his last chance agreement by engaging in the same or similar conduct as set forth in the notice of discipline and terminated his employment.

Schmitt filed a contract grievance pursuant to his collective bargaining agreement, seeking reinstatement. After ruling that the grievance was subject to arbitration, the arbitrator concluded that Schmitt’s termination was in accordance with the last chance agreement and thus such action did not violate the parties' collective bargaining agreement.

The Appellate Division initially noted that although Supreme Court acknowledged that resolving issues relating to the parties' collective bargaining is an appropriate matter for arbitration here Schmitt’s entering into the last chance agreement waived his right to arbitration of issues relating to his dismissal. Thus, said the court, the Department’s objection to the arbitration “should have been sustained at the outset.” Further, said the Appellate Division:

1. By signing the last chance agreement, Schmitt also waived his right to judicial review of the Department’s decision, absent bad faith; and

2. The evidence supports the Department’s conclusion that Schmitt violated the last chance agreement by being AWOL on June 6, 2004 establishes that the decision to terminate respondent was made in good faith.