Shenendehowa Cent. Sch. Dist. Bd. of Educ. (Civil Serv. Empls. Assn., Inc., Local 1000, AFSCME, AFL-CIO, Local 864), 2013 NY Slip Op 00885, Court of Appeals
A school bus driver [Driver] tested positive for marijuana after submitting to a random drug test. This resulted in the School District's terminating Driver from the position, which action was ultimately submitted to arbitration.
The issue presented to the arbitrator: Did the termination of Driver violate the collective bargaining agreement between the parties and, if so, what is the appropriate remedy?
The arbitrator concluded that the School District had violated the agreement and that the penalty imposed on Driver, dismissal, was too severe. The arbitrator directed the School District to reinstate Driver without back pay, subject to certain conditions including an evaluation by a substance abuse professional and a negative drug test.*
The School District filed an CPLR Article 75 petition seeking to vacate that portion of the arbitration award directing that it reinstate Driver to the position of school bus driver and to modify the award by imposing the penalty of termination, contending that Driver had violated the School District’s “zero drug tolerance” policy.
Supreme Court granted the School District’s Article 75 petition seeking to vacate an arbitration award thus reinstating the School District's decision to terminate Driver's employment with the district.
The Appellate Division vacated the Supreme Court’s ruling, finding that the award was not against public policy, was rational, and in making the award the arbitrator did not exceed his powers, holding that “Supreme Court should have confirmed the arbitration award.” The Appellate Division explained that “If a matter is submitted to arbitration, reviewing courts should not interpret substantive conditions of the agreement or delve into the merits of the dispute.”
Citing Matter of Grasso, 72 AD2d 1463 [Leave to appeal denied, 15 NY3d 703], the court said that "Courts must give deference to an arbitrator's decision and cannot examine the merits of an arbitration award, even if the arbitrator misapplied or misinterpreted the law or facts, but a court may vacate an award [where it] violates a strong public policy, is irrational or clearly exceeds a specifically enumerated limitation on the arbitrator's power."
Further, the Appellate Division stated that "[W]here an agreement is 'reasonably susceptible of the construction given it by the arbitrator, a court may not vacate the award," citing Matter of Albany County Sheriffs Local 775 of N.Y. State Law Enforcement Officers Union, Dist. Council 82, AFSCME, AFL-CIO [County of Albany], 27 AD3d 979.
The Court of Appeals agreed with the Appellate Division’s ruling, noting that it has recognized three narrow grounds that may form the basis for vacating an arbitrator's award, repeating the Appellate Division’s criteria that the award violates public policy, is irrational, or clearly exceeds a specifically enumerated limitation on the arbitrator's power, commenting that none of these grounds had been established by the School District in this action.**
Specifically the high court ruled that:
1. The arbitrator's decision did not exceed a specific limitation on his power; nor was it irrational.
2. Contrary to the School District's argument, the parties' agreement did not require the penalty of termination in these circumstances and
3. That the District did not in fact have a zero tolerance policy in place.
According, said the court, the arbitrator’s determination that Driver’s “reinstatement with conditions” was the appropriate penalty did not violate public policy. Although, said the court, “reasonable minds might disagree over what the proper penalty should have been [this] does not provide a basis for vacating the arbitral award or refashioning the penalty...."
Significantly the Court of Appeals noted that the arbitrator “determined that, contrary to the School District's argument, the parties' Taylor Law agreement did not require the penalty of termination in these circumstances and that the District did not in fact have a zero tolerance policy.” This suggests that had the Taylor Law agreement provided for termination in the event the employee tested positive for an unlawful drug or if the School District had a written "Zero Tolerance" drug policy known to Driver in place at the time Driver tested positive for an unlawful drug, the School District would have prevailed.
* The decision notes that “This effectively imposed, at that time, a six-month unpaid suspension” on Driver.
** Article 75 of the CPLR sets out other grounds, not relevant in this action, for a court's vacating an arbitration award.
The decision is posted on the Internet at:
http://www.courts.state.ny.us/reporter/3dseries/2013/2013_00885.htm
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