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Arbitration award modified after arbitrator found to have exceed his authority

By Harvey Randall, Esq.

Arbitration award modified after arbitrator found to have exceed his authority
Matter of Kocsis v New York State Div. of Parole, 41 A.D.3d 1017, Appellate Division, Third Department

A CPLR 7510 petition to confirm an arbitration award was filed by Richard Kocsis, a parole officer.

Kocsis was suspended without pay from his position on September 15, 2004 as a result of numerous charges of misconduct. He filed a ?disciplinary grievance? and the arbitrator found him guilty of most of the charges and ruled that an appropriate penalty would be a four-month suspension without pay (i.e., from September 15, 2004 through January 15, 2005).

In addition, the arbitrator directed that ?[a]ll salary and benefits for the suspension beyond this time period shall be returned to Kocsis except where other income from employment was received.?

While in suspension without pay status, Kocsis underwent surgery for a prior work-related injury and was awarded workers? compensation benefits. These benefits covered the period from December 17, 2004 (the date of his surgery) through June 20, 2005 (the date he was cleared to return to work).

The parties then asked the arbitrator to clarify his award in consideration of the workers? compensation benefits paid to Kocsis. The arbitrator issued a clarification decision in which he ruled that Kocsis should still receive his full pay as set out in the earlier award, minus the amount of the workers? compensation award paid to him.

Kocsis commenced a proceeding pursuant to CPLR Article 75 to confirm the arbitration award as clarified; Parole opposed confirmation (and alternatively sought to vacate the award) on the ground that the arbitrator exceeded his authority in awarding any sum to Kocsis beyond his workers? compensation award because such an award violated the controlling provisions in a collective bargaining agreement.

Supreme Court vacating that portion of the arbitration award directing Parole to pay Kocsis back pay minus his workers? compensation. The Appellate Division agreed with this result, noting:

It is well settled that an arbitration award may be vacated if it exceeds a specifically enumerated limitation on an arbitrator?s authority. Moreover, an arbitrator exceeds his or her authority by granting a benefit not recognized under a governing collective bargaining agreement. Here, while the governing collective bargaining agreement generally grants an arbitrator the authority to order back pay during a period of suspension, it prohibits an arbitrator from adding to, subtracting from or modifying any provision of such agreement. Notably, Article 13.2 of the collective bargaining agreement unequivocally provides that ?[a]n employee who suffers a compensable occupational injury shall be placed on leave of absence without pay for all absences necessitated by such injury and shall receive the benefit provided by the Workers? Compensation Law?).

The Court said that when Kocsis had surgery for his work-related injury, the collective bargaining agreement mandated that he placed on a leave of absence without pay and collect workers? compensation benefits.

Thus, Kocsis? surgery for a work-related injury and subsequent period of convalescence triggered a wholly independent basis upon which he was on leave without pay.

Accordingly, said the court, the ?clarifying arbitration award? that provided Kocsis full salary during a time period when he received workers? compensation benefits, notwithstanding its being offset by his workers? compensation benefits, gave him a benefit that was not otherwise permissible under the collective bargaining agreement.

By so doing, the Appellate Division ruled, the arbitrator modified the terms of the agreement in contravention of the express limitation of his powers.

Full post as published by New York Public Personnel Law on March 27, 2008 (boomark / email).