Nov. 18, 2002 – Hovensa resumed the hiring of non-union employees on Monday, requiring all those offered jobs to agree in writing to have labor disputes resolved by binding arbitration despite a new V.I. law making such a requirement as a condition of employment illegal.
However, the refinery's spokesman, Alex Moorhead, said in a release that all such persons also will be advised that "Hovensa has filed suit challenging the legality of the new law" and that if the law is upheld, the arbitration agreement "will be ineffective," and the company will not seek to enforce it.
Attorney General Iver Stridiron said on Monday that Hovensa's proceeding to hire employees on that basis "is appropriate." He said that "it would have been better from our standpoint if they did not require the pre-arbitration," but given that the company chose to do so, including the proviso concerning the law is "the responsible thing to do."
Moorhead, Hovensa's vice president for government affairs and community relations, said the refinery decided to proceed with hiring because court action on its challenge of the new law is being delayed as a result of delays in the V.I. government's appeal of another, related case.
Hovensa and one of its major contractors, Wyatt V.I., filed suit in District Court in September challenging the new law, which was part of the 2003 Omnibus Appropriations Bill. (See "Arbitration agreement issue in court again".)
Last year, Wyatt began requiring its job applicants to sign such a "pre-dispute arbitration agreement." Labor Commissioner Cecil Benjamin ordered the company to stop making the agreement a condition for employment, and Stridiron issued an opinion calling the agreement "unconscionable," "coercive," "contrary to public policy" and "ripe for injunctive relief."
Wyatt then took the matter to District Court on St. Croix, and in June, District Judge Raymond L. Finch found the agreement neither "unconscionable" nor "unenforceable." In fact, he said, federal law is clear that such agreements are valid.
The V.I. government has appealed that ruling to the 3rd Circuit Court of Appeals. Meanwhile, as Moorhead noted in Monday's Hovensa release, Finch on Oct. 18 issued an order staying all proceedings in the Hovensa case pending a decision by the 3rd Circuit on the appeal of his earlier ruling in the Wyatt case.
In the new suit, Hovensa and Wyatt are asking the District Court to rule that the new law violates the Federal Arbitration Act and thus the supremacy clause of the U.S. Constitution which states that lower jurisdictions shall be bound by federal laws.
"As the result of two developments, it may be many more months before the District Court of the Virgin Islands issues a decision" on the lawsuit challenging the new law, Moorhead said, and for that reason, the company decided to resume hiring workers without waiting for the ruling.
The first development was Finch's stay order. The second was a motion filed in September with the appellate court by the Attorney General's Office requesting a seven-week extension, from Oct. 22 to Dec. 9, for the government to file its opening brief. That motion was granted.
Stridiron said on Monday that his office requested the extension because seven District Court trials within the Civil Division are scheduled for October, "and we have four lawyers in the Civil Division on St. Thomas and four on St. Croix. Just to be able to handle seven trials, we did have to ask for this continuance" in the Circuit Court appeal case.
Moorhead said the Attorney General's Office also has filed motions with the 3rd Circuit Court asking it to send the Wyatt case back to District Court, arguing that it lacks federal jurisdiction, and to stay the briefing schedule for the appeal. Hovensa and Wyatt have filed separate responses opposing both motions, he said.
According to Moorhead, "it is possible that the 3rd Circuit will not issue a decision on the earlier case until after holding a hearing in the spring of next year at the earliest." And thus, he said, "it may be six months or longer before the District Court takes action on Hovensa and Wyatt's suit." Stridiron didn't disagree, saying that with regard to the territory's appeal of the earlier case, "probably the court won't decide until into next year."
The attorney general said when an appeal is considered to be of pressing importance, it is heard in Philadelphia, where the 3rd Circuit Court is based, if the court is not scheduled to travel to the Virgin Islands for some time. Asked if he thought the Wyatt appeal would fall in that category, Stridiron said "probably so."
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