May 3, 2021

If, in the course of collective negotiations, the parties agree to certain terms until "an agreement is reached by the parties," such terms become inoperative when the contemplated agreement between the parties is reached

Supreme Court granted the motion submitted by Board of Education of the City of New York [DOE] to dismiss a hybrid CPLR Article 78 proceeding brought by a Union [UFT] for failure to state a cause of action. The UFT complaint-petition* had alleged:

[1] a breach of contract by DOE; and 

2] DOE's decision not to give retroactive salary increases  to union-member managers that were given to City-wide managerial employees paid pursuant to the Pay Plan for Management Employees was arbitrary and capricious.

The Appellate Division unanimously affirmed the Supreme Court's decision, explaining that the "complete, clear and unambiguous terms of the "Agreement" entered into by the parties require that union-member managers receive the same salary increases received by nonunion managers "[u]ntil an agreement is reached." In other words, as characterized by the court, the Settlement Agreement was operative only as long as collective bargaining negotiations between DOE and the UFT were "ongoing"

The Appellate Division pointed out that UFT's complaint-petition alleged that the nonunion managers received the salary raise and benefits demanded by the Union approximately one year after UFT and DOE entered into the Memorandum of Agreement [MOA]. In the words of the Appellate Division, "[t]hus, the receipt of the salary increase occurred outside the time period contemplated by the Settlement Agreement."

The Appellate Division then opined that UFT's claim that the Settlement Agreement requires the UFT-represented managers to receive retroactive raises granted even after the MOA has taken effect, would inappropriately "add or excise terms or distort the meaning of ... particular words or phrases." Thus, said the court, the breach of contract claim was correctly dismissed by Supreme Court.

Pointing out the UFT's claim that the failure to provide the raise to the union-member managers was arbitrary and capricious was correctly dismissed by the lower court for the reasons stated in the above paragraph, the Appellate Division opined that "DOE determined rationally that the Mayor's Personnel Order, which applied to management-level employees 'in active pay status in a position under the Pay Plan for Management Employees' as of the day before the raise was made retroactive and in active status on the date of this order,' excluded the union-member managers at issue."

* The Appellate Division noted that the complaint-petition alleged that the union-member managers' salaries "were governed by the MOA, not the Pay Plan for Management Employees," when the MOA became effective in November 2017.

Click HERE to access the Appellate Division's decision.

 

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