Long Island Oil Products Co. v. Local 553, 18 N.Y.2d 392 (1966)
In labor disputes with a broad arbitration clause, questions of procedural compliance with grievance steps prior to formal arbitration are presumptively for the arbitrator to decide, not the courts.
Summary
Long Island Oil Products Co. sought to stay arbitration with Local 553, arguing the union failed to follow preliminary grievance procedures. The New York Court of Appeals reversed the lower courts’ stay, holding that procedural issues, like compliance with pre-arbitration steps, are for the arbitrator to decide, given the broad arbitration clause in the collective bargaining agreement. Federal labor law governs these agreements, presuming arbitrability unless the contract explicitly excludes such issues. This ruling emphasizes judicial deference to arbitration in labor disputes and ensures consistent interpretation of labor contracts.
Facts
Long Island Oil Products Co. and Local 553 were parties to a collective bargaining agreement containing a “no strike” clause and a grievance procedure culminating in arbitration. A dispute arose regarding wages allegedly owed to an employee, Louis Bostic. The union contacted the company, and a meeting was held. The company denied Bostic was their employee, refusing the claim. The union then served a “Request for Arbitration.” The company argued the union failed to follow the grievance procedure by not properly convening an arbitration committee before seeking arbitration before the Trucking Industry Arbitration Authority.
Procedural History
The company sought a stay of arbitration in Special Term, which was granted. The Appellate Division affirmed. The Union appealed to the New York Court of Appeals.
Issue(s)
- Whether, under the collective bargaining agreement, the question of compliance with the preliminary steps to arbitration is an issue for the court or the arbitrator to decide.
Holding
- Yes, because in labor disputes with broad arbitration clauses, procedural issues regarding compliance with pre-arbitration grievance steps are presumptively for the arbitrator to decide. The Court found that the broad language of the arbitration clause indicated that procedural, as well as substantive questions, were to be arbitrated.
Court’s Reasoning
The Court emphasized that federal labor law, specifically Section 301 of the Labor Management Relations Act, governs the interpretation and enforcement of collective bargaining agreements with arbitration clauses. Citing Teamsters Local 174 v. Lucas Flour Co., 369 U.S. 95 (1962), the Court noted that state contract law must yield to federal labor law principles. The Court adopted the federal presumption of arbitrability, stating, “where a labor agreement contains an arbitration provision, the presumption is that questions of arbitrability are for the arbitrator.” This presumption extends to procedural issues, citing John Wiley & Sons v. Livingston, 376 U.S. 543 (1964). The Court reasoned that intertwining issues of substance and procedure arising from the same dispute should be resolved in a single forum. The Court stated, “Once it is determined, as we have, that the parties are obligated to submit the subject matter of a dispute to arbitration, ‘procedural’ questions which grow out of the dispute and bear on its final disposition should be left to the arbitrator.” The Court found no language in the agreement to rebut the presumption of arbitrability. The Court distinguished commercial arbitration from labor arbitration, noting the special economic circumstances surrounding collective bargaining. Thus, the procedural question of whether the union properly convened an arbitration committee was for the arbitrator to decide along with the underlying wage dispute.