The District Council of New York City and Vicinity of the United Brotherhood of…

Background

Infinity contracted with the petitioner to build homes through New York City’s Build It Back Program. The contract required Infinity to follow a project labor agreement and a collective bargaining agreement with the District Council. The collective bargaining agreement required unresolved disputes to be submitted to arbitration and stated that the arbitrator’s decision would be final and binding.

The dispute arose after Infinity allegedly underreported employee hours and paid some hours in cash at less than the contractual rate. After the parties failed to resolve the dispute, the petitioner initiated arbitration. Infinity and the District Council appeared at an initial hearing. Respondents later sought an adjournment of a second hearing, but on the rescheduled hearing date their counsel said they would not appear, and respondents filed no further briefs.

The arbitrator issued an award requiring respondents to pay $21,736.83 in wages to underpaid employees, a $25,000 contractual penalty to the Carpenter’s Relief and Charity Fund, and $6,600 in arbitrator’s fees. The arbitrator also determined that Tash Management Corp. was Infinity’s alter ego and therefore an employer responsible for the underpayments. The opinion says the arbitrator incorporated analysis from a prior related proceeding involving Infinity and Tash.

Court’s Review of the Arbitration Award

The petitioner asked the court to confirm the arbitration award under Section 301 of the Labor Management Relations Act. Confirmation converts a final arbitration award into a court judgment. The court explained that review of a labor arbitration award is very limited: it generally asks only whether the arbitrator acted within the authority granted by the collective bargaining agreement, rather than reconsidering the merits or deciding how the dispute should have been resolved.

Because respondents did not oppose the petition, the court treated the petition and supporting record like an unopposed summary-judgment motion. The court nevertheless stated that an unopposed petition must be denied if the undisputed facts do not establish a legal entitlement to judgment.

Here, the court found no indication that the award was obtained through fraud or dishonesty, that the arbitrator ignored the collective bargaining agreement, or that the arbitrator acted outside the agreement’s broad authority. The record indicated that the arbitrator relied on evidence that Infinity paid employees below the contractual rate, evidence concerning Tash’s status as Infinity’s alter ego, the collective bargaining agreement, and undisputed testimony. The court therefore granted the petitioner’s motion and confirmed the award.

Prejudgment Interest

The petitioner requested prejudgment interest at 9% per year, the New York statutory rate, for the period between the arbitration award and the court’s judgment. The court exercised its discretion to award that interest because courts generally presume that prejudgment interest is appropriate when confirming arbitration awards, and the collective bargaining agreement made the arbitration award final and binding.

Attorneys’ Fees and Costs

The court found that an award of attorneys’ fees and costs was justified. It relied on respondents’ failure to participate in the second phase of arbitration, failure to pay any part of the arbitration award, and failure to oppose the confirmation petition, as well as their failure to offer a justification for refusing to follow the award.

The court found that the petitioner was entitled to reasonable attorneys’ fees and costs, but it did not determine the amount because the petitioner had not yet submitted a fee application. The court required any application to be filed by February 17, 2020, with contemporaneous records describing the work performed, and stated that it would not consider a later application.

Disposition

The court directed the Clerk to enter judgment for the petitioner against respondents in the amount of $53,336.83. That amount consisted of $21,736.83 in wage payments, $25,000 in contractual penalties, and $6,600 in arbitrator’s fees. The judgment also included prejudgment interest at 9% per year from November 15, 2019, identified in the conclusion as the award date, through the judgment date. Post-judgment interest would accrue under 28 U.S.C. § 1961. The Clerk was also directed to close the case.