Tuesday, July 09, 2013

In the event it is determined that the arbitrator has exceed his or her powers, the arbitration award must be vacated


In the event it is determined that the arbitrator has exceed his or her powers, the arbitration award must be vacated
Adirondack Beverages Corp. (Bakery, Laundry, Beverage Drivers & Vending Mach. Servicemen & Allied Workers, Local Union No. 669 of Albany, N.Y and Vic.), 2013 NY Slip Op 05031, Appellate Division, Third Department

The genesis of this appeal was the arbitrator’s rejection of Adirondack Beverages’ contention that the grievances at issue were not timely filed under the collective bargaining agreement [CBA].

Ultimately the arbitrator determined that certain of Adirondack Beverages’ employees were entitled to back wages, negotiations with respect to higher wages and a preference with respect to filling certain positions.

Supreme Court concluded that the arbitrator exceeded his powers, granted Adirondack Beverages’ petition to vacate the arbitration award and remitted the matter to a different arbitrator for a rehearing to decide the timeliness of the grievances.* Local Union No. 669 appealed the Supreme Court’s remanding the matter to a new arbitrator.

The Appellate Division affirmed the lower court’s ruling explaining that “[I]t is well established that an arbitrator's award is largely unreviewable but such an award may be vacated upon a showing that it ‘'violates a strong public policy, is irrational, or clearly exceeds a specifically enumerated limitation on the arbitrator's power.'"

In this instance, said the court, Supreme Court properly concluded that the arbitrator exceeded a specifically enumerated limitation on his power by failing to recognize the grievance and arbitration procedures as outlined in the CBA and, more particularly, the time limitation for filing grievances that is contained therein. The Appellate Division cited Article VII, §4 of the CBA which stated that "[t]he [a]rbitrator shall in no way have the right to modify, add to[,] subtract from or [otherwise] alter the provision[s] of [the CBA]."

In his award, said the court, the arbitrator acknowledged the CBA's limitation of his authority, as well as the controlling provisions with respect to filing a timely grievance, but “[n]onetheless, the arbitrator decided that he would ‘not mechanically apply the contractual limitations period in the instant case as to do so would discourage good faith negotiations in the future.’"

Concluding that in refusing to address the issue of the timeliness advanced by Adirondack Beverages that could otherwise preclude the grievances from being arbitrated, the arbitrator ignored a specifically enumerated limitation on his powers and effectively modified, added to or subtracted from the terms of the CBA.

Accordingly the Appellate Division held that Supreme Court properly vacated the arbitrator's award remitted the matter to a different arbitrator for a rehearing to determine whether the grievances were timely submitted under the CBA.

* Supreme Court reserved judgment on Local Union No. 669’s petition to confirm the award pending the arbitrator's decision on the timeliness issue.

The decision is posted on the Internet at:  

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