Labor & Employment Law

Supreme Court holds that CBA arbitration provisions can preclude employees from asserting statutory rights in court

In Alexander v. Gardner Denver, 415 U.S. 36 (1974), the Court held that an arbitration provision in a CBA does not preclude an employee from asserting a violation of Title VII in federal court effectively giving a plaintiff potentially two bites at the apple. [On April 1, 2009], however, the Supreme Court held in 14 Penn Plaza v. Pyett, 556 U.S. ___(April 1, 2009), that a collective bargaining agreement that clearly provides for arbitration of ADEA claims does in fact prevent a private lawsuit.

In a lengthy decision, writing for a slim 5 Justice majority, Justice Thomas distinguishes Gardner Denver and related cases because those cases did not specifically provide that discrimination claims were subject to arbitration. The Court also viewed arbitration in a much more favorable light than the 1974 Court did. As the Court stated:

"The Gilmer Court?s interpretation of the ADEA fully applies in the collective bargaining context. Nothing in the law suggests a distinction between the status of arbitration agreements signed by an individual employee and those agreed to by a union representative. This Court has required only that an agreement to arbitrate statutory antidiscrimination claims be 'explicitly stated' in the collective-bargaining agreement. Wright, 525 U. S., at 80 (internal quotation marks omitted). The CBA under review here meets that obligation. Respondents incorrectly counter that an individual employee must person-ally 'waive? a ?[substantive] right? to proceed in court for a waiver to be ?knowing and voluntary' under the ADEA. 29 U. S. C. §626(f)(1). As explained below, however, the agreement to arbitrate ADEA claims is not the waiver of a 'substantive right' as that term is employed in the ADEA. Wright, supra, at 80; see infra, at 15?16. Indeed, if the 'right' referred to in §626(f)(1) included the prospective waiver of the right to bring an ADEA claim in court, even a waiver signed by an individual employee would be invalid as the statute also prevents individuals from 'waiv[ing] rights or claims that may arise after the date the waiver is executed.' §626(f)(1)(C)."

"Examination of the two federal statutes at issue in this case, therefore, yields a straightforward answer to the question presented: The NLRA provided the Union and the RAB with statutory authority to collectively bargain for arbitration of workplace discrimination claims, and Congress did not terminate that authority with respect to federal age-discrimination claims in the ADEA.

"Accordingly, there is no legal basis for the Court to strike down the arbitration clause in this CBA, which was freely negotiated by the Union and the RAB, and which clearly and unmistakably requires respondents to arbitrate the age-discrimination claims at issue in this appeal. Congress has chosen to allow arbitration of ADEA claims. The Judiciary must respect that choice."

By contrast, Justice Stevens in his dissent states that there are concerns with CBA's providing for enforcement of statutory rights. Justice Souter also wrote a strong dissenting opinion that was joined by 3 other Justices.

Full post as published by New York Public Personnel Law on April 03, 2009 (boomark / email).