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OTTLEY v. PALM TREE NURSING HOME

July 1, 1980

In the Matter of the Arbitrations Between PETER OTTLEY, as President of LOCAL 144 HOTEL, HOSPITAL, NURSING HOME AND ALLIED SERVICES UNION, S.E.I.U., AFL-CIO, Petitioner and PALM TREE NURSING HOME, et al., Respondents.


The opinion of the court was delivered by: DUFFY

OPINION AND ORDER

The parties before me are far from strangers to this Court. See, e.g., Greater New York Health Care Facilities Association, Inc. v. Ottley, 493 F. Supp. 612 (S.D.N.Y. 1980); Greater New York Health Care Facilities Association, Inc. v. Local 144 Hotel, Hospital, Nursing Home and Allied Services Union, 492 F. Supp. 578 (S.D.N.Y. 1980). And, I need not further burden the already tortured record of this litigation by again reciting the facts and circumstances which have brought these parties before this Court once again. It is sufficient to note that the parties are signatories to various collective bargaining agreements which provide, in relevant part, that in exchange for the union's promise not to strike, the Association has agreed to arbitrate any and all disputes arising from the bargaining agreements.

Insofar as the instant dispute is concerned, the primary issue is what contributions are the respondents obligated to make to the pension and welfare funds. The union urges that these funds are on the brink of financial ruin because of management's continued efforts to avoid their financial obligations under the bargaining agreements.

 I must note at the outset that having presided over numerous formal and informal discussions between the parties, it is apparent to me that management has attempted to avoid its financial obligations at every turn. Indeed, if management were to focus as long and hard upon their financial obligations as they have upon frustrating the union's efforts to collect these funds, much of the litigation involving these parties would be unnecessary. However, while management has been somewhat less than diligent with respect to its financial obligations, it has been vigilant in its invocation of the no strike clause in the bargaining agreement. Suffice it to say that management should be aware that the union's promise of no strike is the quid pro quo for the binding arbitration provision. Boys Markets v. Clerks Union, 398 U.S. 235, 90 S. Ct. 1583, 26 L. Ed. 2d 199 (1969).

 Under the terms of the bargaining agreements, there are two avenues of arbitration. The first concerns any disputes with respect to the terms of the bargaining agreements and subsequent modifications thereof. In particular, the agreements provide:

 
If the parties are in dispute as to any of the terms of the Agreements as they existed on November 30, 1976, and they are unable to resolve such disputes between themselves, the same shall be submitted to Mr. Schmertz for binding arbitration.
 
(1) The collective bargaining agreements between the parties, which by their terms expired on March 31, 1978, are extended for a period of three (3) years, from April 1, 1978 to March 31, 1981, except as modified as hereinafter set forth:
 
(b) by any modification as determined by Eric J. Schmertz, who has been designated as Arbitrator to hear all unresolved issues arising in the negotiations between the parties.

 The balance of disputes, under the terms of the agreements, were to be referred to Sidney Wolff for binding arbitration. That is to say, all disputes, save those concerning the terms of the bargaining agreements, are within the province of Sidney Wolff.

 In October, 1979, Mr. Schmertz resigned as arbitrator. In his letter of resignation he stated the reasons for his resignation:

 
As you both know I am chairman of the Labor Cost Review Panel, an adjudicatory forum between the Industry and the State of New York, dealing with medicaid reimbursement rates for increased labor costs. In the year 1978 the Panel dealt only with questions of increased labor costs arising from wage and salary increases under the collective bargaining agreements. Increased costs from improved fringe benefits were excluded. Therefore in 1978 I arbitrated some issues involving fringe benefits which increased the labor costs of Homes and facilities under the collective agreements for that year, but not as to matters which in that year could be submitted to the Labor Cost Review Panel for cost review.
 
However that is not the situation in 1979. Wages, salaries and increased fringe benefit costs in 1979 (as well as in 1980 and until the expiration of the collective agreements in March of 1981) are proper matters for petitions to the Labor Cost Review Panel. Obviously I could not arbitrate any of those issues and/or questions when their cost impact may later come before me in my capacity as chairman of the Labor Cost Review Panel. I consider that Panel and the enforcement and integrity of its proceedings to be of overriding importance to the Industry, the State and the Union.
 
Also, unless you jointly ask me to continue as the mediator within one week from this date, please accept this letter as notice of my withdrawal as the mediator in the capacities and on all ...

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