December 9, 2020

An appointing authority's refusal to participate does not prevent the hearing officer or arbitrator from holding the hearing in absentia and issuing a decision

The New York State Department of Corrections and Community Supervision [DOC] served a notice of discipline on an employee [Individual] setting out five charges against the Individual, each of which centered around the same operative facts -- that the Individual allegedly filed false or misleading incident reports and complaints against her supervisor, with the only difference in the charges being the person or entity to which the Individual's remarks were directed. 

Individual's collective bargaining representative [CSEA] filed a grievance  pursuant to the disciplinary grievance procedure set out in the relevant collective bargaining agreement [CBA]  and the matter was eventually submitted to arbitration, the final step in the contract disciplinary grievance procedure.

CSEA moved to dismiss three of the five charges and a filed a separate motion to preclude certain evidence from being admitted at the disciplinary hearing prior to the arbitration hearing. After allowing the parties to submit their respective arguments in writing, the arbitrator granted CSEA's motion to dismiss in part, dismissing one of the three charges CSEA asked to be withdrawn. The arbitrator also granted CSEA's motion to preclude the introduction of certain evidence in full.

DOC then advised the arbitrator that it would not appear for the hearing unless the arbitrator vacated her earlier decision and reinstate the charge she had dismissed pursuant to CSEA's motion. The arbitrator and DOC subsequently exchanged correspondence over a number of weeks in which DOC reiterated several times that it would not proceed unless all charges — including the charge dismissed by the arbitrator — were heard. Finally DOC move to have the arbitrator recuse herself from the proceeding.

The arbitrator declined to recuse herself, proceeded with the matter notwithstanding the absence of DOC and issued a decision and award without holding an evidentiary hearing. 

The arbitrator dismissed all of the surviving charges and directed that DOC reinstate Employee to her former position "with full back pay and benefits." DOC appealed the arbitrator's award.

The Appellate Division dismissed DOC's appeal, agreeing with the arbitrator that DOC "[did] not meet [its] burden of proof established in the [CBA]" since it "presented no evidence or testimony to prove that [Employee was] guilty of the alleged misconduct identified in the ... notice of discipline."

Finding that DOC "did not waive its right to challenge any of the issues by refusing to participate in the hearing and that the arbitrator exceeded her authority under the relevant CBA provisions by dismissing one charge prior to an evidentiary hearing, Supreme Court granted DOC's cross motion, vacated the arbitration award in its entirety and remanded the matter for "rehearing before a new arbitrator." CSEA appealed Supreme Court's decision.

The Appellate Division reversed the Supreme Court's ruling, holding that the arbitrator acted within her authority and in a manner consistent with the requirements of the CBA and the CPLR. Noting that public policy and the courts have long favored parties' efforts to resolve their disputes by means other than litigation, namely through the alternative submitting the issue to mediation or arbitration, the Appellate Division explained that "[T]he announced policy of this [s]tate favors and encourages arbitration as a means of conserving the time and resources of the courts and the contracting parties," citing Nationwide Gen. Ins. Co. v Investors Ins. Co. of Am., 37 NY2d 91.

Further, declared the Appellate Division, an arbitration award "must be upheld when the arbitrator offers even a barely colorable justification for the outcome reached," although it may be vacated when "it violates a strong public policy, is irrational, or clearly exceeds a specifically enumerated limitation on the arbitrator's power." Thus "[c]ourts must give deference to an arbitrator's decision and cannot examine the merits of an arbitration award, even if the arbitrator misapplied or misinterpreted law or facts," noting the ruling handed down in Shenendehowa Cent. School Dist. Bd. Of Educ. [Civil Serv. Empls. Assn., Inc., Local 1000, AFSCME, AFL-CIO, Local 864], 90 AD3d 1114.

The Appellate Division then reversed the Supreme Court's the order "on the law" and granted CSEA's application to confirm the arbitration award while denying DOC's cross motion to vacate the arbitration award.

Another case, Aures v Buffalo Board of Education, 272 A.D.2d 664, presented a similar situation.

In Aures, the employer, the Buffalo City School District, failed to appear at an unemployment insurance hearing as scheduled. The hearing officer proceeded to hold the hearing “in absentia” and awarded unemployment insurance benefits to the claimant seeking unemployment insurance benefits. Rejecting Buffalo’s appeal challenging the award of such benefits, the Appellate Division ruled that the determination of the Unemployment Insurance Administrative Law Judge was binding on the parties.

The decision in Matter of the Arbitration between CSEA and DOC is posted on the Internet at http://www.nycourts.gov/reporter/3dseries/2020/2020_07007.htm.


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