Guzman v. The First Chinese Presbytarian Community Affairs Home Attendant…

Background

The opinion concerns two separate cases. Alvaro Ramirez Guzman, Elida Agustina Mejia Herrera, and Leticia Panama Rivas—the FCP Plaintiffs—sued First Chinese Presbyterian Community Affairs Home Attendant Corporation. Eugenia Barahona Alvarado sued Alliance for Health, Inc. The plaintiffs were former home health aides and alleged violations of New York State and New York City labor laws, individually and for proposed classes. No class had been certified.

The employers had collective bargaining agreements with 1199SEIU United Healthcare Workers East, the union representing home care employees at the employers. A 2016 amendment required covered wage claims under the Fair Labor Standards Act, the New York Home Care Worker Wage Parity Law, or the New York Labor Law to proceed through grievance and arbitration procedures. The union later began an industry-wide arbitration involving more than forty home health agencies, including the two defendants.

The arbitrator issued an April 17, 2020 award deciding two jurisdictional issues. The award excluded the named FCP Plaintiffs, but it did not exclude the proposed class they sought to represent. The arbitrator initially included Alvarado, but later approved a stipulation excluding her. The plaintiffs then filed applications under New York Civil Practice Law and Rules section 7511 seeking to vacate portions of the award and stay further arbitration. The defendants removed the two cases to federal court under section 301 of the Labor Management Relations Act.

The Motions to Remand

The plaintiffs argued that the cases belonged in state court because their underlying claims arose under state law and prior state-court decisions had already interpreted the relevant agreements. The defendants argued that the applications to vacate the award and stay arbitration required interpretation of the collective bargaining agreements and were therefore completely preempted by section 301.

Complete preemption is a jurisdictional doctrine under which federal law replaces a state-law claim when federal law so completely governs the subject that the claim is treated as arising under federal law. Section 301 applies when a claim is based directly on rights created by a collective bargaining agreement or substantially depends on interpreting one.

Court’s Analysis

Judge Koeltl concluded that the plaintiffs’ requests to vacate the award and stay arbitration depended on deciding the scope and coverage of the collective bargaining agreements and their arbitration provisions. The plaintiffs claimed that the arbitrator exceeded his authority because their claims were not covered by the agreements. Resolving that contention required interpreting the agreements, so the court held that section 301 supplied federal jurisdiction.

The court rejected the argument that the prior state-court decisions eliminated federal jurisdiction. It explained that those arguments might matter to the merits, but they did not remove the federal court’s jurisdiction. The court also rejected the argument that the proposed class changed the result. It stated that plaintiffs could not avoid section 301 by presenting their challenge to a federal labor arbitration as a state-law motion.

The court further concluded that removal was timely because each defendant removed the case within 30 days after the plaintiffs filed the applications seeking to vacate the arbitration award. The court also explained that the FCP state-court injunction applied to the named FCP Plaintiffs, not expressly to the proposed class, and that the arbitrator had excluded the named FCP Plaintiffs from the award.

Disposition

The court denied the plaintiffs’ motions to remand. Because the motions to remand were denied, the court also denied the plaintiffs’ requests for costs and fees. The Clerk was directed to close all pending motions. The opinion did not decide the ultimate validity of the plaintiffs’ wage claims.