New York Law Review

Tag: Title VII

  • Westinghouse Electric Corporation v. State Human Rights Appeal Board, 469 N.E.2d 572 (N.Y. 1984): ERISA Preemption of State Human Rights Laws

    Westinghouse Electric Corporation v. State Human Rights Appeal Board, 469 N.E.2d 572 (N.Y. 1984)

    The Employee Retirement Income Security Act of 1974 (ERISA) preempts state human rights laws only to the extent that the state law prohibits practices that are lawful under federal law.

    Summary

    Westinghouse Electric Corporation appealed a decision by the Appellate Division that found the New York State Human Rights Law was not preempted by ERISA. The Court of Appeals reversed and remitted the case, holding that ERISA preempts state human rights laws only insofar as they prohibit practices lawful under federal law. This decision aligned with the Supreme Court’s ruling in Shaw v. Delta Air Lines, clarifying the scope of ERISA preemption and requiring state agencies to determine if employment practices are prohibited by Title VII before applying state law.

    Facts

    The specific facts underlying the human rights claim are not detailed in this decision. The appeal concerned the broader legal question of whether ERISA preempted New York’s Human Rights Law.

    Procedural History

    The case originated before the State Human Rights Appeal Board. The Appellate Division ruled against Westinghouse, concluding that ERISA did not preempt the State’s Human Rights Law. Westinghouse appealed to the New York Court of Appeals. The Court of Appeals initially affirmed, but following the Supreme Court’s decision in Shaw v. Delta Air Lines, it granted reargument and reversed the Appellate Division’s order, remitting the case for reconsideration.

    Issue(s)

    Whether the Federal Employee Retirement Income Security Act of 1974 (ERISA) preempts New York State’s Human Rights Law (Executive Law, § 296).

    Holding

    Yes, ERISA preempts the New York Human Rights Law, but only to the extent that the state law prohibits practices that are lawful under federal law, because the Supreme Court in Shaw v. Delta Air Lines clarified that state laws are preempted only when they conflict with federal law under Title VII.

    Court’s Reasoning

    The Court of Appeals relied heavily on the Supreme Court’s decision in Shaw v. Delta Air Lines. The Supreme Court articulated a partial preemption standard. According to the Court, state laws are preempted only to the extent they permit what federal law prohibits. The Court of Appeals directly quoted the Supreme Court, stating: “Courts and state agencies, rather than considering whether employment practices are unlawful under a broad state law, will have to determine whether they are prohibited by Title VII. If they are not, the state law will be superseded and the agency will lack authority to act.” This effectively requires state agencies to first assess whether an employment practice violates Title VII before applying state law. If Title VII does not prohibit the practice, then the state law is preempted. The New York Court of Appeals therefore reversed the Appellate Division’s decision and remitted the case for reconsideration in light of Shaw, instructing the lower court to apply this partial preemption standard.

  • Wertheim & Co. v. Halpert, 48 N.Y.2d 1026 (1979): Arbitration Agreements and Statutory Discrimination Claims

    Wertheim & Co. v. Halpert, 48 N.Y.2d 1026 (1979)

    Arbitration agreements are unenforceable when substantive rights, embodied by statute, express a strong public policy which must be judicially enforced, especially in the context of discrimination claims.

    Summary

    Wertheim & Co. sought to compel arbitration of a discrimination claim brought by Halpert. Halpert’s claim, arising from alleged discriminatory conduct in employment, was also the subject of a pending federal court action under Title VII of the Civil Rights Act of 1964. The New York Court of Appeals held that allowing arbitration would risk chilling the exercise of the statutory right against discrimination and could lead to inconsistent verdicts. Therefore, the court affirmed the denial of the motion to compel arbitration, prioritizing judicial enforcement of anti-discrimination laws.

    Facts

    Halpert brought a claim against Wertheim & Co. alleging discriminatory conduct in employment. This claim was simultaneously pursued in two forums. First, Halpert sought arbitration based on an existing arbitration agreement. Second, Halpert initiated a federal lawsuit under Title VII of the Civil Rights Act of 1964, alleging the same discriminatory conduct. Wertheim & Co. moved to compel arbitration of Halpert’s claim.

    Procedural History

    The lower court denied Wertheim & Co.’s motion to compel arbitration. The Appellate Division affirmed the lower court’s decision. Wertheim & Co. appealed to the New York Court of Appeals.

    Issue(s)

    Whether an arbitration agreement is enforceable when the claim sought to be arbitrated arises out of alleged discriminatory conduct in employment and is also the subject of a pending action in federal court under Title VII of the Civil Rights Act of 1964.

    Holding

    No, because arbitration agreements are unenforceable where substantive rights, embodied by statute, express a strong public policy which must be judicially enforced, and allowing arbitration would risk chilling the exercise of the statutory right against discrimination and could lead to inconsistent verdicts.

    Court’s Reasoning

    The Court of Appeals reasoned that while arbitration is a favored method of dispute resolution, it is not appropriate when substantive rights and strong public policy, as embodied in anti-discrimination statutes, are at stake. Citing Matter of Sprinzen [Nomberg], 46 NY2d 623 and Matter of Aimcee Wholesale Corp. [Tomar Prods.], 21 NY2d 621, the court emphasized the importance of judicial enforcement in such cases. The court stated, “Although arbitration is a favored method of dispute resolution, arbitration agreements are unenforceable where substantive rights, embodied by statute, express a strong public policy which must be judicially enforced.” The court also noted the potential for inconsistent verdicts between the arbitration and the federal court proceeding. While acknowledging that an arbitration award would not bind the federal court (citing Alexander v. Gardner-Denver Co., 415 US 36), the court pointed out that a verdict in the federal proceeding could have res judicata effect on the arbitration. Allowing arbitration to proceed would therefore undermine the statutory rights afforded by both state and federal statutes designed to prevent discrimination. This decision underscores the court’s commitment to ensuring that discrimination claims are fully and fairly adjudicated in a judicial forum, where the protections of anti-discrimination laws can be most effectively enforced.