Lawrence E. Dubé of BNA’s Labor Relations Week reported on a post-Pyett discussion at a recent ABA meeting:
“The U.S. Supreme Court ruled earlier this year that a collective bargaining agreement “clearly and unmistakably” requiring employees to arbitrate claims under the Age Discrimination in Employment Act is enforceable, but employers and unions still are uncertain about the long-term effects of the ruling, panelists said Nov. 4 at the American Bar Association Section of Labor and Employment Law’s annual conference.
Paul Salvatore of Proskauer Rose in New York, who appeared before the Supreme Court to argue the employer’s case in 14 Penn Plaza v. Pyett, 129 S.Ct. 1456, 105 FEP Cases 1441 (2009) (23 LRW 561, 4/9/09), called the decision a “quadruple win” that injected “adrenalin into the institution of collective bargaining,” but union attorney Michelle T. Sullivan of Allotta, Farley & Widman in Toledo, Ohio, expressed concern that the decision imposed obligations on unions that “I don’t think they’re equipped to handle.”
Mark Berger, an arbitrator and law professor at the University of Missouri-Kansas City, agreed that unions dealing with the decision will face conflicts of interest and will have to adopt an approach that will be “different than the traditional bargaining system” they are familiar with.
Donald L. Sapir, who represents employees at Sapir & Frumkin in White Plains, N.Y., moderated the discussion.
High Court Ruling Leaves Unanswered Questions
In Pyett, the high court resolved a long-standing controversy about the arbitration of employment discrimination claims of union-represented employees, holding in a 5-4 decision that a collective bargaining agreement that “clearly and unmistakably” requires employees to arbitrate claims under the Age Discrimination in Employment Act was enforceable as a matter of federal law.
Justice Clarence Thomas wrote for the majority that the “broad sweep” of the National Labor Relations Act makes collective bargaining agreements and arbitration provisions enforceable, and nothing in the text of the ADEA prohibited arbitration of discrimination claims.
But Salvatore said it was Justice David Souter who pointed out the “soft underbelly” of the case during oral argument, questioning the rights a union-represented employee should have if a union controlled the employee’s right to obtain arbitration of a discrimination claim and chose not to seek arbitration. Salvatore said Justice Antonin Scalia dismissed that issue during argument as a matter that could be dealt with in the lower courts, and the high court left the issue unresolved.
Robert D. Weisman, a management attorney at Schottenstein Zox & Dunn in Columbus, Ohio, said the development of the law since Pyett may have been slowed by employer concerns about the U.S. economy.
He observed that employers express their unhappiness with cases in which an employee gets “two bites at the apple” by filing a discrimination lawsuit after unsuccessfully pursuing a grievance under a collective bargaining agreement.
But Weisman said many companies are unwilling or unable to spend money on incentives in negotiations they believe will be needed to get union agreement on contract language that would meet the “clear and unmistakable” standard discussed in Pyett.
Union Obligations May Be Complex
Kathleen Phair Barnard of Schwerin Campbell & Barnard in Seattle, who represents employees, commented that the Supreme Court’s decision raises questions about the obligations of unions—not only in their representation of individual employees, but also in their negotiations for processes and procedures to protect the members of a bargaining unit.
Employees may complain that agreements made by unions unfairly compromise employees’ rights to vindicate their statutory rights, Barnard warned, adding that “a whole lot of litigation” would be required to determine whether labor organizations would have to offer service to employees that includes the “bells and whistles” that are available in court litigation.
Several panelists mentioned that unions will have to decide whether to provide lawyers to employees who are pursuing discrimination claims in arbitration, or whether to allow the workers to bring in their own attorneys. Sullivan noted that unions traditionally have considered that they pursue grievances in the interest of the entire bargaining unit, even if individual workers are benefited. Allowing an individual employee or the employee’s lawyer to control the course of a grievance or claim in arbitration “doesn’t work in a union world,” she said.
Berger said Congress continues to consider bills that would preclude employers from requiring mandatory arbitration of individual discrimination claims, and enactment of such legislation “would just end” the debate about Pyett‘s impact.
Many arbitrators would prefer to consider cases in which parties entered bilateral post-dispute agreements to arbitrate issues, Berger said, but he said that the National Academy of Arbitrators has suggested standards for arbitrators to consider in determining whether an arbitration system provides reasonable due process rights to the affected employees.
Berger said such a system should provide some options for necessary discovery, a fair selection of an arbitration, and should not require an employee to waive statutory rights like punitive damages or accept unreasonably short limitation periods. Employees should be able to obtain a reasoned opinion from an arbitration, and not be subjected to filing fees or costs higher than those required in civil litigation.
Berger also cautioned that some court decisions since Pyett have suggested that courts now will give greater deference to a decision or award reached in arbitration. Even if an employee is not required by Pyett to pursue a discrimination claim in arbitration, the worker should consider the possibility of choosing to do so.”