An Appellate Division, First Department, panel yesterday rejected a challenge by a coalition of labor unions to the New York City Health and Hospitals Corp.’s plan for laying off employees in the face of budget constraints. The suit, Roberts v. Gavin, 109438/10, claimed the HHC was arbitrary and capricious, in violation of Article 78, when it decided to create a new structure of layoff units as the basis of its planned layoffs in 2009. Previously, HHC had treated individual hospitals and other medical facilities as single layoff units. Its new plan created smaller layoff units within those facilities.

Manhattan Supreme Court Justice Barbara Jaffe (See Profiledismissed the case as time barred. The unanimous panel reversed that decision, but dismissed the case on the merits. The section of the HHC rules governing layoffs says the agency “may by rule designate an individual facility or division of any facility of [HHC] as separate units for layoff or demotion under this rule,” the panel said. “Thus, the HHC Rules explicitly grant HHC the discretion to designate programs and clinics of HHC facilities as layoff units,” it said.

The panel consisted of Justices David Saxe (See Profile), John Sweeny (See Profile), Dianne Renwick (See Profile), Leland DeGrasse (See Profile) and Rosalyn Richter (See Profile). The named plaintiff in the case is Lillian Roberts, executive director of District Council 37, AFSCME, AFL-CIO, an amalgam of 55 unions.