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HIGH COURT GREEN LIGHTS ARBITRATION OF JOB BIAS CLAIMS UNDER UNION CONTRACTS
On April 1, 2009, the United States Supreme Court handed a rare victory to unionized employers seeking to compel arbitration of job bias claims under existing labor agreements. In the case of 14 Penn Plaza LLC v. Pyett, the High Court enforced a clause in a collective bargaining agreement which explicitly required union members covered by the agreement to arbitrate any claims they may have under the federal age bias laws. This ruling is a major departure from the way the court has looked at this issue for the past thirty-five years.
Like so many union contracts, the contract in the 14 Penn Plaza case explicitly prohibited discrimination under the federal job bias statutes. In addition to that broad prohibition, the contract also explicitly stated that job bias claims would be subject to the contract's grievance and arbitration procedures" as the sole and exclusive remedy." The employer, 14 Penn Plaza LLC, owns and operates a New York City office building. The plaintiffs worked as night lobby watchmen and in other similar jobs. The union filed grievances on the plaintiffs' behalf, challenging job reassignments that they claimed were undesirable. The grievances claimed the violations were the result of illegal age discrimination in violation of the union contract, as well as other provisions of the contract. Before the actual arbitration, the union withdrew the age bias claims. The arbitrator then ruled for the employer on the rest of the plaintiffs' claims.
The grievants then filed suit in federal court to pursue their age discrimination claims. The company sought to compel arbitration of the plaintiffs' claims under the union contract's arbitration clause. Two lower courts rejected the employer's claim. The Supreme Court took the case and overturned those decisions by a narrow 5-4 vote.
The Court's decision in 14 Penn Plaza was a huge victory for employers because it dramatically limits the reach of a 1974 case, Alexander v. Gardner-Denver Co., which nullified provisions in union contracts requiring union members to arbitrate all statutory job bias claims.
In distinguishing the 1974 case from this one, the Court noted that although the contract language in the earlier case broadly prohibited discrimination, it did not explicitly require arbitration of statutory job bias claims. In contrast, the clause in the 14 Penn Plaza union contract did mandate arbitration of such matters.
The Supreme Court found this to be a pivotal distinction. The Court ruled that a clause like this one which explicitly mandates arbitration of statutory job bias claims must be enforced.
The Court also dismissed the idea that a union cannot waive an employee's right to pursue job bias claims in court. The Court noted that while employees cannot be forced to forfeit any "substantive" rights under job bias statutes - such as the right to be free from discrimination, harassment or retaliation - this rule does not apply with respect to where the case is litigated. Thus, contract clauses that specify arbitration as the exclusive remedy will be enforced where the language committing the dispute to arbitration is written in "clear and unmistakable terms."
The Supreme Court's ruling is an important decision for employers with union contracts that already require arbitration of job bias claims. It also provides a road map for those that wish to secure such rights in the future.
We would be pleased to assist your company in evaluating existing language and negotiation strategy for obtaining this important right in future negotiations.
For more information, call us today at (818) 508-3700,
or visit us on the web, at www.brgslaw.com.
Sincerely,Richard S. RosenbergPartnerBRG&S, LLP | 
