Determining if a demand for arbitration was timely filed

Determining if a demand for arbitration was timely filed
Matter of Town of N. Hempstead v Civil Serv. Employees Assn., Inc., 2010 NY Slip Op 08121, decided on November 9, 2010, Appellate Division, Second Department

Two days after the Town of North Hempstead terminated the employment of an employee CSEA advised the Town that it intended to proceed to arbitration. Two months after the employee’s date of dismissal CSEA submitted a demand for arbitration to the American Arbitration Association [AAA] challenging the employee’s dismissal.

North Hampstead filed an Article 75 petition to stay the arbitration contending that under the parties' collective bargaining agreement as well as a subsequent stipulation entered into between the parties, the demand for arbitration to the AAA had to be made within 10 days after the termination of the employee's employment.* The Town’s theory: CSEA’s demand for arbitration was untimely and it was thus entitled to a permanent stay of arbitration.

Although Supreme Court granted the Town’s petition, holding that "[t]here is no precedent for finding that notice to the [Town] of an intent to arbitrate also constitutes timely notice to the AAA as required by the [2008 stipulation],” the Appellate Division reversed the lower court’s decision.

In this instance, said the court, the relevant provisions state that "[w]ithin ten (10) days after . . . discharge . . . only the Union may proceed to Disciplinary Arbitration by written notification to . . . the Town Attorney, and in accordance with the rules and requirements of the AAA as they relate to Labor Arbitration."** This language, said the Appellate Division, “does not require that a demand for arbitration be made to the AAA within that 10-day period.” It simply requires that the Town be notified of the union’s intent within such period.

The court explained that the Stipulation, requiring that a demand for arbitration be made to the AAA within 10 days, refers only to those situations where there has been a Step 1 disciplinary procedure. Here there was “no such Step 1 procedure” making the 10-day rule for making a demand for arbitration to the AAA inapplicable.

Finally, said the court, “to the extent that the subject language governing the time to demand arbitration may be ambiguous, it should be resolved in favor of the employee's right to proceed to arbitration.”

* The Appellate Division noted that the Stipulation specifically provides that the Agreement's time "deadlines . . . are conditions precedent to arbitration." Rejecting CSEA argument that the issue of whether its demand for arbitration was timely made to AAA was for the arbitrator to determine, the court, citing Matter of All Metro Health Care Serv., Inc. v Edwards, 57 AD3d 892, ruled that a court, rather than an arbitrator, was to decide the matter.

** AAA rules do not impose any time limits for filing a demand for arbitration

The decision is posted on the Internet at:
http://www.courts.state.ny.us/reporter/3dseries/2010/2010_08121.htm
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