Apply the public policy exception in considering confirming an arbitration award in situations where the alleged misconduct might constitute a felony

Apply the public policy exception in considering confirming an arbitration award in situations where the alleged misconduct might constitute a felony
United Univ. Professions v State of New York, 2013 NY Slip Op 50084(U), Supreme Court, Albany County

A faculty member in the collective bargaining unit represented by United University Professions (UUP) employed by a unit of the State University of New York [SUNY] was suspended without pay pending the resolution of certain charges of misconduct filed against him. The arbitrator determined that the faculty member was guilty of some, but not all, of the charges. 

Under the circumstances, the arbitrator decided that suspension rather than dismissal was the appropriate penalty to be imposed and directed that the faculty member be reinstated to his former position.*

When SUNY failed to reinstate the faculty member, UUP filed a petition in Supreme Court pursuant to CPLR Article 75 seeking to confirm the Arbitration Award. SUNY cross moved to dismiss the petition and vacate the Award.

Supreme Court, noting that a court may vacate an arbitration award only upon one of the grounds set forth in CPLR 7511(b)[1], said that in support of its motion do vacate the award SUNY contended that the arbitrator exceeded her power. 

This ground, said the court, may be invoked "where the arbitrator's award violates a strong public policy, is irrational or clearly exceeds a specifically enumerated limitation on the arbitrator's power."

SUNY had argued that the arbitrator "exceeded [her] power" because her decision to suspend rather than dismiss the faculty member violated a "strong public policy." In support of its contention that the award violates public policy SUNY cited Penal Law Article 155, noting that the arbitrator had determined that the faculty member committed certain acts that "fit the definition" of larceny and "at the dollar level involved ($78,600.00 or $149,994.00) it would constitute Grand Larceny in the 2nd Degree a Class C Felony..."

Supreme Court said that the arbitrator determined that the faculty member had “inappropriately used the State's facilities and resources for the benefit of his private entity, assigned State employees to perform services for the private entity, and inappropriately directed employees to charge costs related to the private entity to a State grant contract” and other offences. The court, however, decided that SUNY had not demonstrated that the public policy exception applied here, noting that the faculty member was neither charged criminally nor adjudged to be guilty of any crime.

Finding that the arbitrator's determination to suspend the faculty member did not violate any express statute, rule or regulation prohibiting reinstatement under similar circumstances, the Court said that it was unable to conclude that the Award is "prohibit[ed], in an absolute sense." Further, the court said before deciding that the faculty member should be returned to work, the arbitrator considered certain mitigating factors, including [1] the faculty member did not intend to profit personally from his conduct and [2] that the arbitrator apparently concluded that the faculty member believed that his work  would benefit SUNY and provide financial support for his work on behalf of the University.

Another aspect of the case: concerned the arbitrator’s refusal to consider certain e-mails was sent and received via the faculty member’s personal e-mail account and extracted from a State-owned laptop computer.

Supreme Court ruled that SUNY had failed to demonstrate that the requested documents were pertinent and material to the issues presented, explaining that “It is well settled that ‘[a]n arbitrator is not bound by principles of substantive law or rules of evidence, and may do justice and apply his or her own sense of law and equity to the facts as he or she finds them to be,’" citing Perilli v NYS Dept. of Correctional Services, 80 AD3d 617.

The court said that the arbitrator, “after considering all the evidence, such as counsels' characterizations as to the content of the documents and testimony from the State's witness that his opinion with regard to [the faculty member’s] intent was not based solely on the content of the e-mail, declined to accept the documents. SUNY had not established any basis to question the arbitrator's judgment and the record before the Court did not support SUNY's view that her determination constituted misconduct.

Supreme Court granted UUP’s petition to confirm the arbitrator’s award in its entirely.

* The arbitrator determined (1) that SUNY had just cause to immediately suspend the faculty member pending resolution of the disciplinary charges; (2) that the faculty member was guilty of thirty of the alleged acts of misconduct; (3) that the faculty member was not guilty of the 23 remaining alleged acts of misconduct; (4) that the penalty of termination was "not appropriate under the totality of circumstances"; and (5) that the appropriate penalty was suspension from the effective date of his termination to the date of the award

The decision is posted on the Internet at: