Sexual Harassment Arbitration Non-Termination Penalty Violated Public Policy

In a recent case, Matter of Arbitration between New York Office for People With Developmental Disabilities, No. 531029, 2021 N.Y. Slip Op. 02579, 2021 WL 1676979 (N.Y.A.D. 3 Dept. Apr. 29, 2021), the court upheld the lower court’s decision to vacate an arbitration award imposing, against an accused sexual harasser, a penalty the court deemed insufficient – namely, suspension without pay. This, the court held, was contrary to the public policy prohibiting sexual harassment.

The court summarized the facts, issues and arguments as follows:

On April 20, 2018, petitioner issued a notice of suspension and a notice of discipline to an employee, respondent Chad Dominie, advising of his immediate suspension, without pay, based on various disciplinary charges related to sexual harassment in the workplace. The notices specified that petitioner was seeking a penalty terminating Dominie’s employment. The matter proceeded to arbitration pursuant to a collective bargaining agreement (hereinafter CBA) between petitioner and respondent Civil Service Employees Association, Inc., Local 1000, AFSCME, AFL–CIO (hereinafter CSEA) – the collective bargaining representative for certain of petitioner’s employees, including Dominie.

Following a hearing, in a “Decision and Award” dated July 16, 2019, the arbitrator sustained four of the 13 charges and determined that there was probable cause for the interim suspension. The arbitrator found that certain mitigating factors warranted a penalty less than termination. Noting that Dominie was a 20–year employee without a prior disciplinary record, that the coworker who had been sexually harassed no longer worked in the office and that the office lacked proper supervision, the arbitrator found that a suspension without pay until Dominie “returned to active employment” was the “appropriate penalty.” The arbitrator cautioned that her decision “serve[d] as a final warning to [Dominie] that any repeat of offending conduct will most surely result in his termination.” The arbitrator further directed that Dominie was “to be returned to work as soon as practicable.”

Petitioner commenced this CPLR article 75 proceeding seeking to vacate the award, contending that the penalty was against public policy. After issue was joined, Supreme Court granted the petition, vacated the award and remitted the matter for the imposition of a new penalty before a new arbitrator. Respondents appeal.

The core issue presented is whether the arbitrator’s award violated established public policy considerations prohibiting sexual harassment in the workplace. As Supreme Court duly recognized, it is manifest that there is a strong public policy under both state and federal law that prohibits sexual misconduct in the workplace[.]

The arbitrator sustained charges 1, 4, 5 and 10, covering incidents from January 2017 to October 2017 in which Dominie was found to have sexually harassed a female coworker. Specifically, in the first January 2017 incident, Dominie approached the coworker from behind while she was on the phone, reached down her shirt and cupped her breast. A separate incident occurred that month when, among other things, Dominie tackled the coworker on a couch, grabbed her wrist and slapped her thigh. He also put a fake rat on her desk when she reported the incident to a supervisor. In this regard, the arbitrator credited the coworker’s testimony that a supervisor’s meeting ensued during which Dominie promised to stop his misbehavior. He failed to do so. In July 2017, Dominie lifted the coworker’s dress with a hammer, exposing her underpants, blocked her from leaving her cubicle while exposing his penis, and lifted her shirt over her head. His conduct culminated with an incident in October 2017, when Dominie straddled the coworker at her desk and, utilizing vulgar language, threatened to “take” what he wanted. The coworker testified that she feared an imminent rape. Her complaint about this last incident prompted an investigation and the ensuing disciplinary charges. The coworker also filed criminal charges against Dominie, resulting in his plea of guilty to harassment in the second degree.

The findings of the arbitrator are not challenged on this appeal, only the penalty. Under article 33.4(g) of the CBA, the arbitrator’s decision as to a penalty “shall be final and binding upon the parties” and the arbitrator is authorized to “take any … appropriate action warranted under the circumstances including … ordering reinstatement and back pay for all or part of any period of suspension without pay.” Respondents maintain that the arbitrator acted within her broad authority under the CBA to impose an extended suspension without pay and reinstatement given Dominie’s lack of a prior disciplinary record. Notwithstanding this contractual authority, petitioner contends that the arbitrator’s direct reinstatement of Dominie without conditions violates the public policy against sexual harassment.

Applying the law, the court explained:

[W]e have a series of four separate, escalating and outrageous sexual harassment incidents. The events are particularly troublesome considering that Dominie engaged in annual sexual harassment training since 2013 and, when confronted by his supervisors after the two January 2017 incidents, promised not to re-offend. The events that followed were even more egregious and rise to the level of criminal conduct, as memorialized in Dominie’s guilty plea to the harassment charge. Given the extremely inappropriate nature of Dominie’s conduct, we conclude that the arbitrator’s decision violates public policy. The award fails to account for the rights of other employees to a non-hostile work environment and conflicts with the employer’s obligation to eliminate sexual harassment in the workplace[.]

The court also noted that the fact that the victimized coworker no longer worked in the office was not a mitigating factor. It held that the Supreme Court properly vacated the arbitrator’s award as violative of the public policy prohibiting sexual harassment, and concluded that the court was authorized to remit the matter to a different arbitrator for the imposition of a new penalty, pursuant to CPLR 7511(d).

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