Andrade v. Manhattan Painting & Decorating Corp.

Background

Daniel Andrade, who is a union member, sued Manhattan Painting & Decorating Corp., Igbal Erbeli, and Argjent Erbeli in a proposed class and collective action. He alleged that the defendants violated the Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL) by failing to report overtime hours so that overtime was paid below one-and-a-half times the regular rate. He also alleged that the defendants failed to provide annual wage notices and accurate wage statements. Andrade further alleged that he complained about these violations and was then terminated, bringing retaliation claims under the FLSA and NYLL.

Andrade sought to represent an FLSA collective and an NYLL class. The defendants moved under 9 U.S.C. § 4 to compel arbitration and stay the court case while Andrade pursued individual arbitration.

The Arbitration Agreements

The parties did not dispute that an agreement to arbitrate some matters existed. The relevant union trade agreements authorized arbitration of “all grievances and disputes” concerning the “interpretation [and] application” of the trade agreement and authorized remedies for violations of that agreement. The agreements also referred to statutory remedies available under the National Labor Relations Act or other applicable laws and rules.

The defendants argued that this language covered Andrade’s FLSA and NYLL claims. Andrade argued that he had agreed to arbitrate only disputes involving the trade agreement, not statutory wage claims.

Court’s Analysis

The court applied a standard similar to the summary-judgment standard, considering the relevant admissible evidence and drawing reasonable inferences for the party opposing arbitration. It explained that courts generally decide whether the parties agreed to arbitrate a particular dispute and whether that dispute falls within the agreement’s scope.

The court held that a union agreement may waive a worker’s right to litigate statutory claims in court, but the waiver must be “clear and unmistakable.” The agreement must specifically refer either to the statutes at issue or to statutory causes of action generally.

The court concluded that the trade agreements did not meet that standard. Their arbitration provisions were limited to disputes about interpreting or applying the trade agreements and remedies for violations of those agreements. The references to “statutory remedies” described the possible remedies for a trade-agreement violation; they did not show an agreement to arbitrate separate statutory claims. The agreements also did not specifically refer to the FLSA, the NYLL, or statutory causes of action generally.

Disposition

The court denied the defendants’ motion to compel arbitration and stay the case. The clerk was directed to terminate the motion at docket entry 24.