Labor & Employment Law

Settlement cannot be withdrawn even though it was not approved by employer

One surprising issue that comes up with some frequency in public sector labor law is whether an employee can withdraw his or her resignation. Generally, he can if it has not been approved by the employer. But what if he signed a settlement agreement and the only contingency was the employer approving it? Matter of CSEA v. Baldwin Union Free School Dist., ___Misc.3d____(Nassau Co. Feb. 10, 2010), holds that where a settlement agreement is signed by one party the result is different. In reasoning that makes no sense to me, the court explains:

Provided their terms are clear, in writing, and are subscribed by the party to be charged, settlement agreements are to be enforced. Bonnette v Long Island College Hosp., 3 NY3d 281 (2004); Hallock v State of New York, 64 NY2d 224 (1984). To be effective, any qualifications on the obligations of the party signing the agreement must be expressed in the writing itself. See, Goldstein v AccuScan, 2 NY3d 811 (2004); see also, Novelty Crystal Corp. v PSA Institutional Partners, LP, 49 AD3d 113 (2d Dept. 2008). A clear release of claims not the result of fraud or overreaching should likewise be enforced. Booth v 3669 Delaware, Inc., 92 NY2d 934 (1998).

Here, the terms of the agreement are quite clear, and it was undisputedly signed by Pignataro and an Association representative after negotiations. The only contingency found relates to the need for Board approval of the agreement, and only upon the Board's disapproval was his resignation to be deemed withdrawn. There is no language giving Pignataro the right to rescind the resignation under any other circumstance, nor was there a period given during which he could choose to withdraw from the agreement itself.

In short, and contrary to the petitioners' contentions, this was not a "proposed settlement." It was a settlement, signed by the parties to be charged. Indeed, the resignation letter itself refers to full execution and approval by the Board as the only contingencies.

Further, there is no charge of fraud or overreaching or of any other behavior by the District that might call the validity of the agreement into question. Accordingly, the Court finds that it was fully enforceable by the District upon the Board's approval.

The court is missing one important legal issue. There is no binding contract until both parties sign it. Here, both parties did not sign the agreement so I fail to understand why the employee could not withdraw his resignation. I hope this decision is appealed.

Mitchell H. Rubinstein

Harvey Randall Comments: Alfred v Safir, 283 A.D.2d 280, concerned a similar issue.

The Appellate Division's decision in Alfred suggests that where the appointing authority is to make the final determination concerning the terms and conditions of a "settlement of a disciplinary action", it would be prudent for:

1. The employer?s representative to insist that the settlement of a disciplinary action agreement include a statement to the effect that the settlement is subject to the approval of the appointing authority and that the appointing authority may modify, in whole or in part, its terms and conditions; and

2. The employee, or the employee's representative, to insist that the settlement agreement include a provision spelling out what is to happen in the event the appointing officer does not agree to imposed the terms and conditions set out in the settlement proposal.

The Appellate Division's rationale in unanimously affirming Safir's action: "[t]he various determinations and penalties agreed to by [Alfred] and [the department's] advocate and/or hearing officer were not binding" on Safir, the appointing authority,? citing Silverman v McGuire, 51 NY2d 228.

Another decision that considered the impact of the terms set out in a settlement with respect to a subsequent action by the appointing authority is Elmira CSD v Newcomb, 266 A.D.2d 622.

Concerning the issue of a public officer or employee withdrawing his or her written resignation, typically once the resignation is delivered to the appointing authority, or to the appointing authority's designated representative, it may not be withdrawn or rescinded without the consent of the appointing authority. See, for example, 4 NYCRR 5.3(c), which, in pertinent part, provides that "A resignation [which must be in writing] may not be withdrawn, cancelled or amended after it is delivered to the appointing authority, without the consent of the appointing authority."

Further, except where otherwise provided or required by law, the appointing authority's "acceptance" or "approval" of the resignation is not needed for the resignation to be effective. Indeed, 4 NYCRR 5.3(b), which applies to employees of the State as an employer, provides, in relevant part, that ?... when charges of incompetency or misconduct have been or are about to be filed against an employee, the appointing authority may elect to disregard a resignation filed by such employee and to prosecute such charges and, in the event that such employee is found guilty of such charges and dismissed from the service, his [or her] termination shall be recorded as a dismissal rather than as a resignation? [emphasis supplied].

An example of requiring the "acceptance" of the resignation for it to take effect: §2111 of the Education Law, "Resignation of district officers." §2111 states that a school district officer "may resign to a district meeting." §2111 then further provides that officer shall also be deemed to have resigned if he or she filed a written resignation with the district superintendent of his of her district "and such superintendent endorses thereon his approval and files the same with the district clerk" [emphasis supplied]. See, also, §2110.3 of the Education Law.

Full post as published by New York Public Personnel Law on May 11, 2010 (boomark / email).