Opinion ID: 2102261
Heading Depth: 1
Heading Rank: 7

Heading: Liverpool and Presumptions Regarding Arbitrability

Text: In 1960, 17 years before Liverpool, the United States Supreme Court decided Steelworkers v Warrior & Gulf Co. (363 US 574) [2] a case that involved private sector parties and a Federal statutein which it adopted a presumption of arbitrability. The Supreme Court observed that the Federal Labor Management Relations Act of 1947 (29 USC § 141 et seq.) was imbued with a congressional policy in favor of arbitration to resolve labor disputes and that courts should interpret arbitration clauses accordingly, unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage ( Steelworkers v Warrior & Gulf Co., supra, at 582-583). This has been a consistent theme in Federal labor law cases (see, e.g., AT&T Technologies v Communications Workers, 475 US 643 [1986]; but see, Wright v Universal Mar. Serv. Corp., 525 US 70 [1998]). In pre-Liverpool cases that involved the application of Federal law, this Court applied the Steelworkers presumption of arbitrability ( e.g., Matter of Howard & Co. v Daley, 27 NY2d 285; Matter of Fitzgerald [General Elec. Co.], 19 NY2d 325). Emphasizing, however, the relatively brief acquaintance that the State had with Taylor Law grievance arbitration, and lacking an adequate, reassuring experience, the Court, in Liverpool, expressed hesitancy over the prospect of prematurely expanding the arbitral portals in public sector cases. In Liverpool the Court emphasized that arbitration did not yet carry the same historical or general acceptance or demonstration of    efficacy in the public sector as it did in the private sector ( Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. [United Liverpool Faculty Assn.], supra, at 513). In the absence of unequivocal agreement to the contrary, it was to be taken that a public employer, being charged with nondelegable responsibilities, did not intend to arbitrate grievances ( Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. [United Liverpool Faculty Assn.], supra, at 513-514). That was 1977, and it epitomized a wait-and-see attitude. We have waited, and we have seen. Arbitration in the public arena is no longer unfamiliar or unaccepted. It is a reality, and it is widespread. The enormous growth in the use of collective bargaining agreements has generated vast experience in drafting arbitration clauses. Public sector parties may now use phrases that have been litigated into familiarity. They are free to negotiate language that will define disputes in areas of the broadest permissible scope. Parties are likewise free to negotiate exclusions, and to word arbitration clauses with sufficient clarity for a court to be able to tell, on a threshold determination, whether they intended a permissible subject or type of dispute to be arbitrable or not. Liverpool did not expressly create a presumption against public sector arbitrability. To the extent, however, that one may be implied or fairly so characterized, an anti-arbitrational presumption is no longer justified either in law, or in the public sector labor environment. The lengthy chronicle of this Court's cases after Liverpool proclaims as much, as does the huge increase of public sector arbitration over the last quarter century. Liverpool's approach calls for a two-step analysis necessary in public sector arbitrations which, by its nature involves concerns of public policy not at issue in Steelworkers. We will stay with the Liverpool format because it has been workable for over two decades, with results that have largely comported with the Steelworkers presumption with respect to CBA interpretation. We will preserve the two-step Liverpool analysis for judicial threshold consideration, free of any presumptions. [3]