NYC v. FIRE OFFICERS ASSN.

• Decision Date: 17 October 2000
• Citation: 95 N.Y.2d 273,739 N.E.2d 719,716 N.Y.S.2d 353
• Parties: In the Matter of CITY OF NEW YORK et al., Respondents, v. UNIFORMED FIRE OFFICERS ASSOCIATION, LOCAL 854, IAFF, AFL-CIO, et al., Appellants.
• Court: New York Court of Appeals Court of Appeals

95 N.Y.2d 273

739 N.E.2d 719

716 N.Y.S.2d 353

In the Matter of CITY OF NEW YORK et al., Respondents, v. UNIFORMED FIRE OFFICERS ASSOCIATION, LOCAL 854, IAFF, AFL-CIO, et al., Appellants.

Court of Appeals of the State of New York.

Argued September 12, 2000.

Decided October 17, 2000.

Pryor Cashman Sherman & Flynn, L. L. P., New York City (Richard M. Betheil and Tina C. Kremenezky of counsel), for Uniformed Fire Officers Association, Local 854, IAFF, AFL-CIO, and another, appellants.

Victoria A. Donoghue, New York City, and Wendy E. Patitucci for Board of Collective Bargaining of the City of New York and another, appellants.

Michael D. Hess, Corporation Counsel of New York City

(Cheryl Payer, Stephen J. McGrath and Felicia Mennin of counsel), for respondents.

Claude I. Hersh, New York City, and James R. Sandner for Municipal Labor Committee, amicus curiae.

Judges SMITH, LEVINE, CIPARICK and ROSENBLATT concur with Judge WESLEY; Chief Judge KAYE dissents and votes to reverse in a separate opinion.

OPINION OF THE COURT

WESLEY, J.

The issue we must address today is whether public policy bars arbitration of this dispute over whether the employee rights provisions of a collective bargaining agreement (CBA) can be invoked to limit or restrict the procedures of criminal investigations commenced by the New York City Department of Investigation (DOI). We conclude that it does.

In February 1996, DOI subpoenaed several firefighters as part of criminal investigations it was conducting. One investigation concerned an attempt by a firefighter to obtain higher pension benefits by fraudulently claiming that he sustained a disabling injury in the line of duty. The scheme involved one firefighter calling in a false alarm to afford the injured firefighter the opportunity to claim that his injury occurred in responding to the alarm. Among those firefighters interviewed were members of appellant Union, Uniformed Fire Officers Association, Local 854 (UFOA).

The applicable citywide CBA contains provisions for individual employee rights under Article XVII and arbitration of grievances under Articles XVIII and XXI. Article XVII relates to interrogations, interviews, trials and hearings. The protections afforded by Article XVII include the requirement that the employee be given written notice of an interview, interrogation, trial or hearing. The employee must be informed of the subject matter of the proceeding and must be informed if he or she is being considered a suspect or a non-suspect. Any questioning of an employee is to be of reasonable duration and the interrogator is prohibited from using offensive or profane language, from threatening the employee for failure to answer questions and from promising anything to the employee if that employee does answer questions. Where an employee is "a suspect in a departmental investigation or trial" the employee must be advised of the right to refuse to answer questions, that the answers may not be used against him or her in criminal proceedings so long as they are truthful and that the failure to answer renders the employee subject to dismissal. The employee must also be advised of the right to counsel and of the right to union representation. If the employee invokes the right to counsel and/or union representation, the matter must be adjourned for two working days.

Article XVII further imposes restrictions on the scope of any questioning concerning personal behavior outside of work except with respect to matters related to official business, extra-departmental employment, conflict of interest, injuries or illness, residency, performance as a volunteer firefighter or loss or improper use of departmental property. Non-suspect employees are required to cooperate and their statements may not be used against them. Finally, where the City fails to comply with the provisions of Article XVII, any questions put to an employee shall be withdrawn and the refusal to answer any such questions shall not be prejudicial to the employee.

During one of the February 1996 DOI interviews, a fire officer's union representative was excluded over objections of the union counsel. At another interview, the union counsel questioned the adequacy of the notice under Article XVII. The Union thereafter filed a request for arbitration of the grievance, claiming that the City was violating Article XVII by the failure of its agency, DOI, to abide by Article XVII. The City challenged the arbitrability of the request before appellant New York City Board of Collective Bargaining (BCB). The BCB issued a determination finding the dispute to be arbitrable.

The City thereafter commenced this special proceeding pursuant to CPLR articles 75 and 78 in Supreme Court, seeking to annul the BCB's determination and to enjoin arbitration of the dispute. According to the City, it never agreed to arbitrate the procedures employed by the DOI in conducting its criminal investigations; the CBA cannot, as a matter of public policy, supplant or impair those procedures; and the grievances are not arbitrable because to do so would violate public policy.

Supreme Court set aside the BCB's determination and enjoined arbitration, stating that "the core function of ensuring governmental integrity is a public policy sufficiently strong as to preclude referral of this dispute to arbitration." (Matter of City of New York v DeCosta, 176 Misc 2d 936, 943

.) The Appellate Division unanimously affirmed, holding that public policy, as reflected in the New York City Charter and in decisional law, prohibits any interference with DOI's authority to question public employees in the course of an investigation (Matter of City of New York v Uniformed Fire Officers Assn., 263 AD2d 3). We now affirm.

Determining arbitrability requires a two-pronged inquiry (Matter of Board of Educ. [Watertown Educ. Assn.], 93 NY2d 132, 137 [citing Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. (United Liverpool Faculty Assn.), 42 NY2d 509]). First, a court must decide whether "arbitration claims with respect to the particular subject matter of the dispute [are] authorized" (Matter of New York City Dept. of Sanitation v MacDonald, 87 NY2d 650, 656; see also, Matter of Board of Educ. [Watertown Educ. Assn.], supra, 93 NY2d, at 137); i.e., that the claims are "lawfully fit for arbitration" (Matter of Barnes [Council 82, AFSCME], 94 NY2d 719, 723). Second, the court must ascertain whether the authority to arbitrate was in fact exercised and the parties consented by the terms of their particular agreement to refer disputes in this specific area to arbitration (Matter of Board of Educ. [Watertown Educ. Assn.], supra, 93 NY2d, at 138 [quoting Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. (United Liverpool Faculty Assn.), 42 NY2d 509, 513, supra]).

Under the first prong, the subject matter of the dispute controls the analysis (Matter of Board of Educ. [Watertown Educ. Assn.], supra, 93 NY2d, at 137; Matter of Blackburne [Governor's Off. of Empl. Relations], 87 NY2d 660, 665). The court must determine "that there is nothing in statute, decisional law or public policy which would preclude the municipality and its employee or group of employees from referring the dispute to arbitration" (Matter of Committee of Interns & Residents [Dinkins], 86 NY2d 478, 484). If there is some statute, decisional law or public policy that prohibits arbitration of the subject matter of dispute, "then the answer to the first inquiry is no, and the claim is not arbitrable regardless of the answer to the second question" (id., at 484; see, Matter of Blackburne [Governor's Off. of Empl. Relations], supra, 87 NY2d, at 665). We have recognized limited instances where arbitration is prohibited on public policy grounds alone (see, e.g., Matter of Blackburne [Governor's Off. of Empl. Relations], 87 NY2d 660, supra [termination of an employee who violated the Hatch Act]; Honeoye Falls-Lima Cent. School Dist. v Honeoye Falls-Lima Educ. Assn., 49 NY2d 732 [school district's ability to lay off those with the least seniority to maintain academic standards]; Board of Educ. v Areman, 41 NY2d 527 [school board's right to inspect teacher personnel files]; Matter of Cohoes City School Dist. v Cohoes Teachers Assn., 40 NY2d 774

[school board's ability to terminate probationary teachers and make tenure decisions]).

The public policy at stake here is DOI's ability to conduct criminal investigations. We have recognized that "[p]ublic policy, whether derived from, and whether explicit or implicit in statute or decisional law, or in neither, may * * * restrict the freedom to arbitrate" (Matter of Susquehanna Val. Cent. School Dist. [Susquehanna Val. Teachers' Assn.], 37 NY2d 614, 616-617). From our review of the statutory and decisional law concerning the DOI, its purpose and its powers, we conclude that a strong public policy enjoins the arbitration of the grievance here.

The Legislature has recognized the importance of allowing a city to conduct investigations into its internal affairs. General City Law § 20 (21) empowers every city in the State to "investigate and inquire into all matters of concern to the city or its inhabitants, and to require and enforce by subpoena the attendance of witnesses at such investigations." DOI is the entity charged by the City of New York with the critical responsibility of investigating possible criminal conduct and conflicts affecting City agencies or City employees (NY City Charter § 803). The power to investigate matters pertaining to corrupt or other criminal activity, conflicts of interest, gross mismanagement or abuse of authority within the City, is firmly vested with DOI (see, NY City Charter § 803 [b]; NY City Mayoral Executive Order No. 16, §§ 1, 4 [f] [1978], as amended by NY City Mayoral Executive Order No. 78, § 1 [1984]). To effectuate this mandate, DOI is authorized "to compel the attendance of witnesses, to administer oaths and...