Whether an arbitrator violates public policy by reinstating a union employee who was terminated for safety violations, where the terminating employer has a statutory duty to manage public safety.

No. Unless the statute empowering the employer to provide for public safety expressly precludes the arbitrator either from deciding the penalty for rule infractions or from reaching reinstatement as a remedy, the arbitrator may reinstate an employee under a collectively bargained disciplinary process.

This opinion consolidates two cases in which the New York City Transit Authority (NYCTA) sought to vacate an arbitration award that reinstated an employee who had been terminated for violating safety rules. Under the grievance/arbitration procedure of the Transport Workers Union ² NYCTA collective bargaining agreement, the arbitrators exercised the authority to review employee infractions and uphold or adjust the disciplinary measures taken by the NYCTA. Although both arbitrations resulted in disciplinary measures, neither determined that the safety rule violations in question justified the most serious sanction, termination. The NYCTA applied to vacate the arbitrators' respective awards pursuant to C.P.L.R. § 7511, on the grounds that the awards violated the public policy expounded in Public Authorities Law § 1204(15), which gives general statutory powers to the NYCTA Ëto exercise all requisite and necessary authority to manage, control and direct the maintenance and operation of transit facilities for the convenience and safety of the public.Ó In the first case, Rodriguez, the Supreme Court upheld the award and the Appellate Division reversed; in the second, Bright, the Supreme Court vacated the award and the Appellate Division affirmed. The Court of Appeals reversed.

The Court emphasized that judicial intervention in arbitration proceedings on public policy grounds is limited, especially in arbitrations relating to public employment collective bargaining agreements. (As expressed in the Taylor Law (Civil Service Law § 200(c)), the latter support a countervailing public policy interest in facilitating relations between governmental employers and employees.) Citing Matter of Sprinzen, 46 N.Y.2d 623, 631 (1979), the Court found that in order for the public policy exception to apply, it would need to find that either Public Authorities Law § 1204(15) Ëprohibits in an absolute sense the particular matters to be decided by arbitration,Ó or that the award itself Ëviolate[s] a well-defined constitutional, statutory or common law of this State.Ó The Court held that § 1204(15) did not prohibit the NYCTA from submitting employee disciplinary actions to an arbitrator, and that the outcome of the arbitrations to which the NYCTA voluntarily submitted did not to violate public policy. See Matter of New York State Correctional Officers and Police Benevolent Assn., 94 N.Y.2d 321 (1999).

The Court also held that the arbitration awards violated no constitutional, statutory or decisional law, as §1204(15) only alludes generally to public safety and neither explicitly nor implicitly demands the dismissal of employees who violate safety rules. The Court adopted the reasoning of an analogous United States Supreme Court case and found that since §1204(15) would not preclude the results reached during arbitrations, the public policy is insufficient to justify overturning the arbitration awards. See Eastern Associated Coal Corp. v. United Mine Workers of Am., 531 U.S. 57 (2000). Therefore, the Court reversed the orders vacating the arbitrators' awards.