In re Howard & Co., 27 N.Y.2d 282 (1970)
When a collective bargaining agreement contains a broad arbitration clause covering disputes related to employment terms and conditions, a dispute over severance pay, even if not explicitly mentioned in the agreement, is subject to arbitration unless the agreement contains specific language excluding such disputes.
Summary
G.E. Howard & Co. sought to stay arbitration demanded by the union regarding severance pay for employees after the company’s liquidation. The collective bargaining agreement contained a broad arbitration clause covering disputes related to the interpretation of the agreement or any term or condition of employment. The company argued that since the agreement made no specific provision for severance pay, the issue was not arbitrable. The New York Court of Appeals reversed the lower courts, holding that the broad arbitration clause encompassed the severance pay dispute, and it was for the arbitrator, not the court, to determine the merits of the claim. Federal policy favors arbitration in labor disputes, and the agreement did not contain language explicitly excluding severance pay disputes from arbitration.
Facts
G.E. Howard & Co., a wholesale grocery business, had a collective bargaining agreement with the union representing its employees. John A. Riley, the surviving partner, decided to retire, terminate the partnership, and liquidate the business. The employees were notified, and the union demanded severance pay, which the company refused, arguing that the agreement did not provide for it. The union filed unfair labor practice charges with the NLRB, but the board declined to issue a complaint.
Procedural History
The union sought arbitration. The company petitioned the Supreme Court, Orange County, for a stay of arbitration. The trial court granted a permanent stay, finding that the agreement did not provide for severance pay. The Appellate Division affirmed. The Court of Appeals then reviewed the Appellate Division’s order.
Issue(s)
Whether a dispute over severance pay is subject to arbitration under a collective bargaining agreement with a broad arbitration clause covering disputes concerning any term or condition of employment, even though the agreement does not explicitly mention severance pay.
Holding
Yes, because the broad arbitration clause in the collective bargaining agreement encompasses disputes concerning any term or condition of employment, and the agreement does not contain specific language excluding severance pay disputes from arbitration.
Court’s Reasoning
The court emphasized the federal policy favoring arbitration in labor disputes, citing Steelworkers v. Warrior & Gulf Navigation Co., 363 U. S. 574, 582-583. It distinguished between commercial arbitration agreements, which require a clear expression of intent to arbitrate, and collective bargaining agreements, where a presumption of arbitrability exists. The court stated, “arbitration of a ‘particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute’”. The court found that the arbitration clause in the agreement was broad enough to cover the severance pay dispute, as it concerned a