Monday, April 23, 2018

2d Circuit Reviews Manifest Disregard of the Law Standard in Labor Arbitration

Chelsea v. N.Y. Hotel and Motel Trades Council, ____F.3d____(2d Cir. April 3, 2018), is brought to readers attention because it is a recent Second Circuit decision which, once again, demonstrates how difficult it is to vacate a labor arbitrator's decision. The court notes that there is a strong presumption that an arbitrator has not acted in manifest disregard of the law and it will uphold the decision under review so long as there is at least a slightly colorable basis. The court goes on the describe the manifest disregard standard as follows:

An arbitral decision rendered under the Labor
Management Relations Act (“LMRA”) may be vacated if the
arbitrator has exhibited a “manifest disregard of law.”
Westerbeke Corp. v. Daihatsu Motor Co., 304 F.3d 200, 208
(2d Cir. 2002) (internal quotation marks omitted).
Judicial inquiry under the “manifest disregard” standard is
“extremely limited.” Merrill Lynch, Pierce, Fenner &
Smith, Inc. v. Bobker, 808 F.2d 930, 934 (2d Cir. 1986);
see also Burns Int’l. Sec. Servs., Inc. v. Int’l Union,
United Plant Guard Workers of Am., 47 F.3d 14, 17 (2d Cir.
1995). To establish manifest disregard, Chelsea Grand must
show the arbitrator made “something beyond and different
from a mere error in the law or failure on the part of the
arbitrators to understand or apply the law.” Saxis S.S.
Co. v. Multifacs Int’l Traders, Inc., 375 F.2d 577, 582 (2d
Cir. 1967) (internal quotation marks omitted).
An arbitrator commits manifest disregard of the law
when the “governing law alleged to have been ignored by the
arbitrators [was] well defined, explicit, and clearly
applicable,” and the arbitrator “appreciate[d] the
existence of a clearly governing legal principle but
decide[d] to ignore or pay no attention to it.” Westerbeke
Corp., 304 F.3d at 209 (first alteration in original)
(quoting Merrill Lynch, 808 F.2d at 934); see also N.Y.
Tel. Co. v. Commc’ns Workers of Am. Local 1100, 256 F.3d
89, 91 (2d Cir. 2001) (per curiam). The rule ignored by
the arbitrator must be “obvious and capable of being
readily and instantly perceived by the average person
qualified to serve as an arbitrator.” Merrill Lynch, 808
F.2d at 933.

Monday, April 16, 2018

Governor Signs Into Law Major Legislation Narrowing A Unions Duty of Fair Representation

On April 12, 2018, Governor Cuomo signed Chapter 59 of the Laws of 2018 into law which amends the Taylor to narrow a public sector unions duty of fair representation. The amended statute now provides (the underlined portion represents the amendment):

  Improper  employee organization practices. It shall be an improper
   practice for an employee organization or its agents deliberately (a)  to
   interfere  with,  restrain or coerce public employees in the exercise of
   the rights granted in section two hundred two, or to cause,  or  attempt
   to cause, a public employer to do so provided, however, that an employee
   organization  does not interfere with, restrain or coerce public employ-
   ees when it limits its services to and representation of non-members  in
   accordance with this subdivision; (b) to refuse to negotiate collective-
   ly  in good faith with a public employer, provided it is the duly recog-
   nized or certified representative of the employees of such employer;  or
   (c)  to breach its duty of fair representation to public employees under
   this article. Notwithstanding any law, rule or regulation to the contra-
   ry, an employee organization's duty of fair representation to  a  public
   employee it represents but who is not a member of the employee organiza-
   tion  shall be limited to the negotiation or enforcement of the terms of
   an agreement with the public employer.  No  provision  of  this  article
   shall be construed to require an employee organization to provide repre-
   sentation  to  a non-member (i) during questioning by the employer, (ii)
   in statutory or administrative proceedings or to  enforce  statutory  or
   regulatory  rights, or (iii) in any stage of a grievance, arbitration or
   other contractual process concerning the evaluation or discipline  of  a
   public employee where the non-member is permitted to proceed without the
   employee organization and be represented by his or her own advocate. Nor
   shall  any  provision  of this article prohibit an employee organization
   from providing legal,  economic  or  job-related  services  or  benefits
   beyond  those  provided  in the agreement with a public employer only to
   its members.

This statute was reportedly enacted in anticipation of the U.S. Supreme Court's decision in Janus which may ultimately hold that it is a violation of the First Amendment for states (such as New York) to mandate that employees pay "agency fees" if they chose not to become union members. The Governor signed this statute into law at UFT headquarters, here, and reportedly stated that this statute “is the first step of the resistance.”

Friday, April 6, 2018

Supremes Refuse To Interpret FLSA Exemptions In A Narrow Fashion

On April 3, 2018, the US Supreme Court decided Encino Motorcars v. Navarro  and decided 5-4, that FLSA exempts a service adviser at a car dealership from its overtime protections under the exemption for “any salesman . . . primarily engaged in . . . servicing automobiles.” 29 U.S.C. § 213(b)(10)(A).

But, the Court, in dicta went way beyond deciding this case and stated that the FLSA exemptions should not be narrowly construed. As the Court explained:
Because the FLSA gives no “textual indication” that its exemptions should be construed narrowly, “there is no reason to give [them] anything other than a fair (rather than a ‘narrow’) interpretation.” Scalia, Reading Law, at 363. The narrow construction principle relies on the flawed premise that the FLSA “‘pursues’” its remedial purpose “‘at all costs.’” American Express Co. v. Italian Colors Restaurant, 570 U. S. 228, 234 (2013) (quoting Rodriguez v. United States, 480 U. S. 522, 525-526 (1987) (per curiam)); see also Henson v. Santander Consumer USA Inc., 582 U. S. ___, ___ (2017) (slip op., at 9) (“[I]t is quite mistaken to assume . . . that whatever might appear to further the statute’s primary objective must be the law” (internal quotation marks and alterations omitted)). But the FLSA has over two dozen exemptions in § 213(b) alone, including the one at issue here. Those exemptions are as much a part of the FLSA’s purpose as the overtime-pay requirement. See id., at ___ (slip op., at 9) (“Legislation is, after all, the art of compromise, the limitations expressed in statutory terms often the price of passage”). We thus have no license to give the exemption anything but a fair reading.
This dicta would appear to apply to all of the FLSA exemptions and has the potential to result in a finding that many more employees, such as professionals, administrators, and executives, are exempt, and therefore, not entitled to over-time. 

Query whether courts will follow Justice Thomas' reasoning when deciding over-time cases under state law (as opposed to federal law).

Mitchell Rubinstein

Thursday, March 29, 2018

Challenge to NYS Tenure Survives a Motion to Dismiss

In Davids v. State, ____A.D. 3d____ (1st Dep't. March 28, 2018), Plaintiffs in this consolidated appeal brought an action claiming that the various tenure statutes violate the NYS Consitution Education Article which guarantees students the right to a "sound basic education." The Appellate Division affirmed the lower court decision which refused to dismiss the case. As the court explained:
The Education Article requires the Legislature to provide for the maintenance and support of a system of free common schools, wherein all the children of this state may be educated'" ... "[S]tudents have a constitutional right to a sound basic education'" (Paynter v State of New York, ..."[A] sound basic education consists of the basic literacy, calculating, and verbal skills necessary to enable children to eventually function productively as civic participants capable of voting and serving on a jury'" (Paynter ..." Fundamentally, an Education Article claim requires two elements: the deprivation of a sound basic education, and causes attributable to the State'" (Aristy...
Here, the Davids plaintiffs allege in their complaint that teachers are a key determinant of the quality of education students receive and have a profound impact on students' lifetime achievement. The Davids plaintiffs allege that students taught by ineffective teachers—those in approximately the bottom five percent of teachers in New York—suffer lifelong problems and fail to recover from this marked disadvantage.
The Davids plaintiffs allege that the statutory scheme which controls the dismissal of teachers in New York and a seniority-based layoff system make it nearly impossible for school administrators to dismiss ineffective teachers. Specifically, the Davids plaintiffs allege that the following statutes pertaining to the dismissal of teachers deprive students of a sound basic education: Education Law §§ 1102(3), 2509, 2573, 2590-j, 3012, 3014, and 3020-a (hereinafter collectively the Dismissal Statutes). They further allege that Education Law § 3013(2), which mandates that teachers with the least seniority be laid off first (i.e., "last in first out"; hereinafter the LIFO Statute), also deprives students of a sound basic education.
The Davids plaintiffs allege that because of the Dismissal Statutes, school administrators are compelled to either leave ineffective teachers in place or transfer them from school to school. This statutory scheme, they allege, inevitably presents a fatal conflict with the right to a sound basic education guaranteed by article XI, § 1 of the NY Constitution because it forces certain New York students to be educated by ineffective teachers who fail to provide such students with the basic tools necessary to compete in the economic marketplace and participate in a democratic society.
This is a very important decision to watch. I predict the Court of Appeals will grant leave to decide this case and it will ultimately reverse this decision. This is what has happened in other states. see, Vergara v. California Teachers Assoc., ___P.3d___(Ct. App. 2016). See also, Forslund v. State, 2017 Minn. App. Unpub. Lexis 789 (Minn. Ct. of Appeals 2017)(dismissing challenge to state tenure statute). On the other hand, should Plaintiffs prevail in the Court of Appeals (survive the Motion to Dismiss) and ultimately win at trial, this case has to potential to change tenure as we know it.

Tuesday, February 27, 2018

2d Circuit Issues Major En Banc Decision Holding Sexual Orientation Protected Under Title VII

Zarda v. Altitude Express, Inc., ___F.3d___(2d Cir. Feb. 26, 3018) (en banc), is a major decision that is undoubtedly on its way to the U.S. Supreme Court. The Second Circuit issued a 163 page decision with 8 separate opinions. The court ruled 9-3 that homosexuality or sexual orientation is protected under Title VII.  The court overruled Simonton v. Runyon, 232 F. 3d 33 (2d Cir. 2000) and largely adopted the EEOC's position as set forth in Baldwin v. Foxx, 2015 WL 4397641 (July 15, 2015).

What I found most interesting about the case was Chief Judge Katzmann's majority opinion where after recognizing that sexual orientation claims were consistently not cognizable under Title VII, he stated that "legal doctrine evolves..." (Slip Op. at 8). Nevermind that the statute simply uses the phrase "because of sex" and efforts to amend Title VII to include sexual orientation have failed. That of course, was the point of the dissent.

This decision, as you may expect, has generated substantial press coverage.

I suspect such coverage will continue.

The real question is what will the Supreme Court do? My personal belief is that they have to take this case and that the Court for once and for all will recognize that sexual orientation is protected under Title VII. No matter how conservative the Court is, they recently recognized the constitutional right of homosexuals to marry. Obergefell v. Hodges, 135 S. Ct. 2584 (2015). In my view, it would be entirely illogical to believe that once married, an employer can terminate that employee for being gay.

Yes, I know Obergefell was decided on constitutional grounds and Title VII is a federal statute, so Obergefell will not technically be controlling, but come on?

For you law students out there, this case involves the classic issue about the role of judges in our society and what does "interpret the law mean?" Conservatives will stick to the exact language of the statute and examine what Congress intended in 1964 when they wrote the phrase "because of sex." Liberals recognize that legal doctrine, as Senior Judge Katzmann stated, "evolves" over time based upon the mores of society.

Before you jump into one camp or the other, consider another controversial issue-guns. Should the Second Amendment be interpreted conservatively only refer to the type of "arms" that existed in 1787 or should the right to bear arms include modern day weapons involving assault rifles? 

I also suspect the outcome of any Supreme Court case may also hing on whether President Trump gets another Supreme Court appointment and which Justice, if any, retirees. President Trump's Justice Department argued against protecting homosexuals from discrimination under Title VII. They lost big.

What do you think?

Mitchell Rubinstein

Tuesday, February 13, 2018

New York Court of Appeals Orders Disclosure of Facebook Information

The New York Court of Appeals issued a major lengthly decision concerning the disclosure of information on Facebook. Forman v. Henkin, ____N.Y.3d____(Feb. 13, 2018), was a personal injury action where Plaintiff claimed that she was impaired after a serious injury. The Defendant sought access to Plaintiff's entire Facebook account and Defendant claimed that it was private. Ultimately, the Court ordered limited disclosure, reasoning:

Rather than applying a one-size-fits-all rule at either of these extremes, courts addressing disputes over the scope of social media discovery should employ our well-established rules — there is no need for a specialized or heightened factual predicate to avoid improper "fishing expeditions." In the event that judicial intervention becomes necessary, courts should first consider the nature of the event giving rise to the litigation and the injuries claimed, as well as any other information specific to the case, to assess whether relevant material is likely to be found on the Facebook account. Second, balancing the potential utility of the information sought against any specific "privacy" or other concerns raised by the account holder, the court should issue an order tailored to the particular controversy that identifies the types of materials that must be disclosed while avoiding disclosure of nonrelevant materials. In a personal injury case such as this it is appropriate to consider the nature of the underlying incident and the injuries claimed and to craft a rule for discovering information specific to each. Temporal limitations may also be appropriate — for example, the court should consider whether photographs or messages posted years before an accident are likely to be germane to the litigation. Moreover, to the extent the account may contain sensitive or embarrassing materials of marginal relevance, the account holder can seek protection from the court (see CPLR 3103[a]). Here, for example, Supreme Court exempted from disclosure any photographs of plaintiff depicting nudity or romantic encounters.
Plaintiff suggests that disclosure of social media materials necessarily constitutes an unjustified invasion of privacy. We assume for purposes of resolving the narrow issue before us that some materials on a Facebook account may fairly be characterized as private [FN5]. But even private materials may be subject to discovery if they are [*5]relevant. For example, medical records enjoy protection in many contexts under the physician-patient privilege (see CPLR 4504). But when a party commences an action, affirmatively placing a mental or physical condition in issue, certain privacy interests relating to relevant medical records — including the physician-patient privilege — are waived (see Arons v Jutkowitz, 9 NY3d 393, 409 [2007]; Dillenbeck v Hess, 73 NY2d 278, 287 [1989]). For purposes of disclosure, the threshold inquiry is not whether the materials sought are private but whether they are reasonably calculated to contain relevant information.
Applying these principles here, the Appellate Division erred in modifying Supreme Court's order to further restrict disclosure of plaintiff's Facebook account, limiting discovery to only those photographs plaintiff intended to introduce at trial [FN6]. With respect to the items Supreme Court ordered to be disclosed (the only portion of the discovery request we may consider), defendant more than met his threshold burden of showing that plaintiff's Facebook account was reasonably likely to yield relevant evidence. At her deposition, plaintiff indicated that, during the period prior to the accident, she posted "a lot" of photographs showing her active lifestyle. Likewise, given plaintiff's acknowledged tendency to post photographs representative of her activities on Facebook, there was a basis to infer that photographs she posted after the accident might be reflective of her post-accident activities and/or limitations. The request for these photographs was reasonably calculated to yield evidence relevant to plaintiff's assertion that she could no longer engage in the activities she enjoyed before the accident and that she had become reclusive. It happens in this case that the order was naturally limited in temporal scope because plaintiff deactivated her Facebook account six months after the accident and Supreme Court further exercised its discretion to exclude photographs showing nudity or romantic encounters, if any, presumably to avoid undue embarrassment or invasion of privacy.
In addition, it was reasonably likely that the data revealing the timing and number of characters in posted messages would be relevant to plaintiffs' claim that she suffered cognitive injuries that caused her to have difficulty writing and using the computer, particularly her claim that she is painstakingly slow in crafting messages. Because Supreme Court provided defendant no access to the content of any messages on the Facebook account (an aspect of the order we cannot review given defendant's failure to appeal to the Appellate Division), we have no occasion to further address whether defendant made a showing sufficient to obtain disclosure of such content and, if so, how the order could have been tailored, in light of the facts and circumstances of this case, to avoid discovery of nonrelevant materials.

Tuesday, January 9, 2018

Court of Appeals Issues Major 3020-a Decision

On January 9, 2017, the Court of Appeals issued a 14 page decision addressing the standard of review to be applied in Education Law Section 3020-a cases. Bolt v. Department of Education, ___N.Y. 3d___(Jan. 9, 2018). Interestingly, the Court's major opinion is fairly short (about a half of a page) and there is a concurring opinion which spans about 14 pages. This decision primarily addresses the issue of whether the Appellate Division erred by concluding that in 3 separate appeals,  that the Hearing Officer decision to terminate was shockingly excessive. In concluding that the Appellate Division erred in all three appeals, the majority simply stated:
"That reasonable minds might disagree over what the proper penalty should have been does not provide a basis for vacating the arbitral award or refashioning the penalty" (City School Dist. of the City of N.Y. v McGraham, 17 NY3d 917, 920 [2011]). Here, the penalties imposed are not irrational and do not shock the conscience (see Matter of Russo v New York City Dept. of Educ., 25 NY3d 946, 948 [2015], cert denied ___ US ___, 136 S Ct 416 [2015]; Matter of Kelly v Safir, 96 NY2d 32, 38 [2001]; Matter of Featherstone v Franco, 95 NY2d 550, 554 [2000]; Matter of Pell v Board of Educ. of Union Free School Dist. No. 1 of Towns of Scarsdale & Mamaroneck, Westchester County, 34 NY2d 222, 233 [1974]). The Appellate Division exceeded its authority by reweighing the evidence and substituting its judgment for that of the hearing officer.
It is difficult for me to understand the court's rationale. How is a court to determine whether or not a particular decision is shocking if it does not weigh the evidence?

Monday, November 27, 2017

2d Department Decision Illustrates More Favorable State Discrimination Standards

Kassapian v. City of New York, ____A.D.3d____(2d Dep't. Nov. 15, 2017), is brought to your attention for several reasons.

The case concerned an ALJ who alleged that she was terminated because of her age, sex and retaliation for her speech under the NYS Constitution. She sought to amend her Free Speech Claim to assert a 1983 claim and the court held that a Notice of Claim was not required.

The court also held that the lower court erred by dismissing plaintiff's sexual harassment claims and appeared to apply a much more liberal standard than federal courts do. As the court explained:

Here, the Supreme Court erred in granting those branches of the defendants' motion which were pursuant to CPLR 3211(a)(7) to dismiss the causes of action alleging employment discrimination on the basis of sex and age in violation of the NYCHRL (see Administrative Code of City of NY § 8-107[1][a][3]). The allegation that a coworker repeatedly demonstrated a sex toy to the plaintiff was sufficient to state a cause of action to recover damages for sexual harassment in violation of the NYCHRL (see Nelson v HSBC Bank USA, 87 AD3d 995, 999). Further, in opposition to the defendants' motion, the plaintiff submitted an affirmation of a separate coworker detailing further allegations of sexual harassment directed toward the plaintiff. The court erred in determining that the cause of action must be dismissed because the behavior constituted no more than petty slights or trivial inconveniences. A contention that the behavior was a petty slight or trivial inconvenience constitutes an affirmative defense (see Williams v New York City Hous. Auth., 61 AD3d 62, 80), which should be raised in the defendants' answer and does not lend itself to a pre-answer motion to dismiss (see Kaplan v New York City Dept. of Health & Mental Hygiene, 142 AD3d 1050, 1051).
Further, the allegations of disparate treatment of older employees, including the plaintiff, and that the plaintiff's demotion was based, in part, on age discrimination, sufficiently stated a cause of action to recover damages for age discrimination in violation of the NYCHRL (see Administrative Code of City of NY § 8-107[1][a][3]; Bennett v Health Mgt. Sys., Inc., 92 AD3d 29, 40; cf. Askin v Department of Educ. of the City of N.Y., 110 AD3d 621, 621-622). The fact that the individual defendants were approximately the same age as the plaintiff does not render the cause of action insufficient (see Rollins v Fencers Club, Inc., 128 AD3d 401, 402).
The Supreme Court also erred in granting dismissal of the cause of action alleging unlawful retaliation based on the plaintiff's complaints of sexual harassment. Under the NYCHRL, the retaliatory act or acts complained of "must be reasonably likely to deter a person from engaging in protected activity" (Administrative Code of City of NY § 8-107[7]; see Brightman v Prison Health Serv., Inc., 108 AD3d 739, 739). The allegations that, following the plaintiff's complaint to a supervisor concerning alleged sexual harassment, the plaintiff was assigned double the normal workload, subjected to increased scrutiny of her work and reprimands for minor errors, and ultimately demoted a few months later, sufficiently stated a cause of action to recover damages for unlawful retaliation for the plaintiff's complaints of sexual harassment in violation of the NYCHRL (see Ananiadis v Mediterranean Gyros Prods., Inc., 151 AD3d 915, 920; Fletcher v Dakota, Inc., 99 AD3d 43, 51-52; Williams v New York City Hous. Auth., 61 AD3d at 71). However, the complaint failed to allege that the plaintiff ever complained about the alleged age discrimination, and thus the court properly granted dismissal of the cause of action alleging unlawful retaliation based on complaints of age discrimination.

2d Circuit Reviews Manifest Disregard of the Law Standard in Labor Arbitration

Chelsea v. N.Y. Hotel and Motel Trades Council , ____F.3d____(2d Cir. April 3, 2018), is brought to readers attention because it is a recent...