Amicus Curiae Brief — Gilmer v. Interstate/Johnson Lane Corp.

Supreme Court brief1991

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Text

Attorneys for Amicus Curiae

Equal Employment Advisory 5

N N g

5 DONALD L. GOLDMAN

17 7 1400 Statler Office Tower a

a, Cleveland, Ohio 44115-1688 .

2a (216) 696-1122

2 Attorney for Amicus Curiae

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TABLE OF CONTEN:S

e ———

INTEREST OF THE AMICI CURIAE E

STATEMENT OF THE CASE

, a

I. THE FEDERAL ARBITRATION ACT, BOL-

II.

STERED BY THIS COURT’S INCREASING

CONFIDENCE IN THE ARBITRAL PROC-

ESS, MANDATES ENFORCEMENT OF A

PRIVATE AGREEMENT TO ARBITRATE

EMPLOYMENT DISPUTES ..............................

A. Judicial Hostility to Arbitration as a Means

for Resolving Statutory Claims Has Been

Repudiated in This Court’s Recent Decisions..

1. Mitsubishi (1985), McMahon (1987) and

Rodriguez (1989) Express Increasing

Confidence in the Arbitral Process

2. Gardner-Denver (1974), Barrentine

(1981) and McDonald (1984) Rest on

‘an Outmoded Presumption of Disfavor-

ing Arbitration” and, in Any Event, Are

Inapplicable to Cases Involving Individ-

ual Agreements To Arbitrate ...................

B. The Recent EEOC Pronouncement Regard-

ing Arbitration of ADEA Claims Is Not

Entitled to Deference .......................................

C. The Federal Arbitration Act Is Applicable

to Individual Employment Agreements.

VOLUNTARY ARBITRATION OF ADEA

CLAIMS IS NOT INCONSISTENT WITH THE

PURPOSES OF THE ACT AND IS SUP-

PORTED BY SOUND PUBLIC POLICY........

TABLE OF CONTENTS—Continued

A. The FAA Requires Arbitration of Statutory

Claims Unless Congress Intended Otherwise..

B. The ADEA Does Not Preclude Voluntary

Arbitration

1. Arbitration Can Protect Individual

8. —— ‚—

2. Arbitration Does Not Interfere with the

EEOc's Enforcement Role

3. “Legislative History” of Unenacted Leg-

islation Is Not Germane to this Case and

Cannot Evince Congressional Intent

4. Sound Public Policy Supports Arbitration

of Employment Disputes

CONCLUSION

iii

TABLE OF AUTHORITIES

Cases: Page

Alexander v. Gardner-Denver Co., 415 U.S. 36

I 7, 10, 11, 12, 19

Atchison, Topeka and Santa Fe Railway Company

v. Buell, 480 U.S. 557 (1987ʒjõꝛ7;ꝝ 13

Barrentine v. Arkansas-Best Freight Systems, 450

ESAT TT 7, 10, 12, 13, 19

Becton v. Consolidated Freight ways, 687 F. 2d 140

(6th Cir. 1982), cert. denied, 460 U.S. 1040

r 3

Bird v. Shearson Lehman American Express, Inc.,

871 F.2d 292 (2d Cir.), vacated and remanded,

r 21

Bormann v. AT & Communications, Inc., 875

F.2d 399 (2d Cir.), cert. denied, 110 S. Ct. 292

r 20, 23

Cirillo v. Arco Chemical Company, 862 F.2d 446

EE EIST 20

Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213

EEE EE 8

Dickstein v. DuPont, 443 F. 2d 783 (Ist Cir. 1971) 16

Dorosiewicz v. Keyser-Roth Hosiery, Inc., No. 86-

3163 (4th Cir. June 24, 1987) (unpublished) 20

Erving v. Virginia Squires Basketball Club, 468

ee 16

General Electric Company v. Local 205, United

Electrical, Radio and Machine Workers of Amer-

ica (U. Z.), 368 U.S. 547 (1987) 13

Gilmer v. Interstate Johnson Lane Corp., 895 F. 2d

e eessuesnenveced 4, 5, 18

Gormin v. Brouon-Forman Corp., 744 F. Supp. 1100

(M.D. Fla. 1990), appeal docketed, No. 90-3719

I 20

Harbison-Walker Refractories v. Brieck, cert. dis-

missed, 487 U.S. 1216 (1988) —............................ 4

Hydrick v. Management Recruiters International,

Inc., 738 F. Supp. 1434 (N.D. Ga. 19900) 16

ILE, Local 790 v. Robbins & Meyers, 429 U.S. 229

e 3

TABLE OF AUTHORITIES—Continued

Page

Lancaster v. Buerkle Buick Honda Co., 809 F.2d

539 (8th Cir.), cert. denied, 482 U.S. 928

1 —. ee ee 20

Lorillard v. Pons, 434 U.S. 575 (1979 4

McDonald v. City of West Branch, Michigan, 466

„ 3, 7, 10, 11, 12

McLaughlin v. Richland Shoe Co., 486 U.S. 128

(1988) bann e e e eee eee 5 €

Miller Brewing Company v. Brewery Workers

Local Union No. 9, AFL-CIO, 739 F.2d 1159

(7th Cir. 1984), cert. denied, 469 U.S. 1160

„„ ee ene een we oe 16

Mitsubishi Motors Corp. v. Soler Chrysler-

Plymouth, 473 U.S. 614 (1985) 7, 8, 12, 17, 18

Moses H. Cone Memorial Hospital v. Mercury Con-

struction Corporation, 460 U.S. 1 (1983 8

Nicholson v. CPC International Inc., 877 F.2d 221

r eC eee 11, 17, 18, 21

O’Hare v. Global Natural Resources, Inc., 898 F.2d

Sy . 20

Perry v. Thomas, 482 U.S. 483 (1987) 16

Pierce v. Shearson Lehman Hutton, 52 Fair Empl.

Prac. Cases (BNA) 1882, appeal dismissed for

lack of jurisdiction, No. 90-2079 (7th Cir. Sep-

tember 24, 1990) (stayed by district court pend-

ing outcome of Gilmer) ......................--...... 3 19

Pierce v. Underwood, 487 U.S. 552 (1988) 23-24

Public Employees Retirement System v. Betts, 109 -

e ee a 4,14

Rodriguez de Quijas v. Shearson/American Ex-

press, 490 U.S. 477, 109 S.Ct. 1917 (1989). 9, 12, 18

Rogers v. Frito-Lay, Inc. and Moon v. Roadway

Express, Inc., 611 F.2d 1074 (5th Cir.), cert.

denied, 449 U.S. 889 (1980) 23

Runyan v. National Cash Register Corp., 787 F.2d

1039 (6th Cir.), cert. denied, 479 U.S. 850

r 20

Securities Industry Association v. Connolly, 883

F.2d 1114 (Ist Cir. 1989), cert. denied, 110 S. Ct.

TT 3 24-25

TABLE OF AUTHORITIES—Continued

Shearson/American Express, Inc. v. McMahon, 482

U.S. 220 (1987) ............... — 5, 8, 9, 11, 12, 17,

Shell Oil Co. v. Dartt, 434 U.S. 99 (197777

Signal- Stat Corporation v. Local 475, United Elec-

trical, Radio and Machine Workers of America,

(UE), 235 F.2d 298 (2d Cir. 195)

Stokes v. Merrill Lynch, Pierce, Fenner & Smith,

Inc., 523 F.2d 433 (6th Cir. 1975

Strozier v. General Motors, 635 F.2d 424 (5th Cir.

r Aa

Tenney Engineering, Inc. v. United Electrical

Radio & Machine Workers of America, (U.E.)

Local 437, 207 F.2d 450 (3d Cir. 1953

Trans World Airlines v. Thurston, 469 U.S. 111

wee

United Air Lines v. McMann, 434 U.S. 192 (1977)

United Paperworkers International Union, AFL-

CIO v. Misco, Inc., 484 U.S. 29 (1987)

Wilko v. Swan, 346 U.S. 427 (1953) 9,

Statutes:

Age Discrimination in Employment Act of 1967, as

amended, 29 U.S.C. § 621 et Sg

r .

r al

Fair Labor Standards Act, 29 U.S.C. § 201 et seq...

Z — ha diepeeniasaiiies

EE EK

Federal Arbitration Act (FAA), 9 U.S.C. §1 et

ERS SE ee 5, 7,

r . eRe oR ne

r CE

EEK ̃ . ee

Labor-Management Relations Act of 1947, 29

Older Workers’ Benefit Protection Act, Pub. L.

Page

18, 19

16, 23

2,17

10, 19

13, 15

TABLE OF AUTHORITIES—Continued

Racketeer Influenced and Corrupt Organizations

Act (RICO), 18 U.S.C. § 1961 et seg

Securities Act of 1933, 15 U.S.C. S8 7Ta-77a a

Section 12 (2), 15 U.S.C. 8 771(2) T:)

Securities Exchange Act of 1934, 15 U.S.C. § 77a

7 Spe A De Ie ce

Section 10B, 15 U.S.C. § 78j (ohr

Sherman Act, 15 U.S.C. § 1 et seg.

Title VII of the Civil Rights Act of 1964, as

amended, 42 U.S.C. § 2000e et seg

EE ET

Legislative History:

S. 2856, 100th Cong., 2d Sess., 134 Cong. Rec.

814509 (daily ed. October 4, 1988)

S. 54, 101st Cong., Ist Sess., 135 Cong. Rec. S168

(daily ed. January 25, 19899999 z ..

H. R. 5500, 100th Cong., 2d Sess., 134 Cong. Rec.

H10154 (daily ed. October 12, 1988)

Conf. Rep. No. 856, 101st Cong., 2d Sess. 26

111

Veto Message on S. 2104— Message from the Presi-

dent— PM 152. 136 Cong. Rec. 816457 (October

r EI eR a, a Ce

Miscellaneous:

Note, A Test of Arbitrability: Does Arbitration

Provide Adequate Protection for Aged Employ-

ees? 35 Villanova L. Rev. 389 (19900)

EEO Notice No. N-915-060 (August 29, 1990)

Report of the Federal Courts Study Committee

1 c

Page

IN THE

Supreme Court of the United States

OCTOBER TERM, 1990

No. 90-18

ROBERT D. GILMER,

2 Petitioner,

INTERSTATE/JOHNSON LANE CORPORATION,

Respondent.

On Writ of Certiorari to the

United States Court of Appeals

for the Fourth Circuit

BRIEF AMICI CURIAE OF THE

EQUAL EMPLOYMENT ADVISORY COUNCIL

AND THE

PROFESSIONAL EMPLOYMENT RESEARCH COUNCIL

IN SUPPORT OF RESPONDENT

The Equal Employment Advisory Council (“EEAC”)

and the Professional Employment Research Council

(“PERC”) respectfully submit this brief amici curiae.

The written consents of all parties have been filed with

the Clerk of this Court. The brief urges affirmance of

the decision below and thus supports the position of Re-

spondent before this Court.

INTEREST OF THE AMICI CURIAE

EEAC is a nationwide association of employers and

trade associations organized in 1976 to promote sound

approaches to the elimination of discriminatory employ-

ment practices. Its membership comprises a broad seg-

ment of the business community. The Council’s govern-

ing body is a Board of Directors composed of experts in

the field of equal employment opportunity. Their com-

bined experience gives the Council an unmatched depth

of knowledge of the practical as well as the legal aspects

of equal employment policies and requirements. The

members of EEAC are firmly committed to the principles

of nondiscrimination and equal employment opportunity.

All of EEAC’s members, and the constituents of its

trade association members, are employers subject to the

Age Discrimination in Employment Act, 29 U.S.C. § 621

et seg. (ADEA), and Title VII of the Civil Rights Act

of 1964, as amended, 42 U.S.C. § 2000e et seg. (Title

VII), as well as other equal employment statutes and

regulations. As employers, many of EEAC’s members

and member constituents have entered into contracts

governing some or all terms and conditions of employ-

ment. Some of these agreements are entered into with

individual employees, while others are reached with em-

ployee organizations through the collective bargaining

process. Many such contracts include agreements to ar-

bitrate. As potential respondents to charges of discrim-

ination pursuant to the ADEA and other employment

statutes, EEAC’s members are interested in the extent

to which a contractual commitment to arbitrate disputes

arising out of the employment relationship is enforce-

able when the claim arises under the ADEA.

PERC is an organization composed of participants in

the personnel placement service industry. Its member-

ship includes franchisors, referral networks, companies,

and the largest national association in the industry. In

all, approximately 4,000 offices are represented in PERC,

a number which approaches twenty-five percent of the

entire industry. The vast majority of the offices repre-

sented are small businesses with five to ten employees.

Many of PERC’s members and member constituents

have employment agreements which utilize arbitration

agreements. This affords them the ability to resolve dis-

putes in a manner that is more expeditious and less ex-

pensive and time-consuming than litigation. Since the

owners are needed in the day-to-day management of their

businesses and often are dependent on their own personal

productivity, the time involved in even unfounded litiga-

tion could have a disastrous effect on their businesses.

Thus, the issues presented in this appeal are extremely

important to the nationwide constituencies that EEAC

and PERC represent. The court below held that the

agreement between Petitioner and Respondent to arbi-

trate all claims arising out of their employee-employer

relationship compelled arbitration of Petitioner’s claim

under the ADEA. This conclusion is consistent with this

Court’s more recent decisions regarding arbitration, and

is not inconsistent with the language, the legislative his-

tory, or the purposes of the ADEA.

Because of its interest in the orderly application of

the nation’s civil rights laws, EEAC has filed briefs as

amicus curiae in cases before the United States Supreme

Court, the United States Circuit Courts of Appeals and

various state supreme courts. As part of this amicus

activity, EEAC has briefed a number of cases involving

the interface between arbitration or grievance proce-

dures and statutory claims. See McDonald v. City of

West Branch, Michigan, 466 U.S. 284 (1984) (unap-

pealed arbitration award does not have preclusive effect

in case brought under 42 U.S.C. § 1983) ; JUE, Local 790

v. Robbins & Meyers, 429 U.S. 229 (1976) (filing a con-

tractual grievance does not toll Title VII charge-filing

period); Becton v. Consolidated Freightways, 687 F.2d

140 (6th Cir. 1982), cert. denied, 460 U.S. 1040 (1983)

(arbitration decision that employee was discharged for

just cause can be relied upon in a Title VII suit to show

a valid reason for discharge); Strozier v. General

Motors, 635 F.2d 424 (5th Cir. 1981) (knowing and

voluntary acceptance of reinstatement and back pay un-

der a grievance settlement constituted a waiver of the

right to file a later Title VII suit based upon the same

facts).

EEAC and PERC seek to assist the Court in this case

by highlighting the impact its decision may have beyond

the instant case in the field of employment dispute res-

olution generally. Accordingly, this brief brings relevant

matter to the attention of this Court that has not already

been brought to its attention by the parties. Because of

their substantial experience, EEAC and PERC are

uniquely situated to brief the Court on the relevant con-

cerns of the business community and the significance of

this case to employers.

STATEMENT OF THE CASE

Respondent Interstate/Jolinson Lane Corporation

(“Interstate”) hired Petitioner Robert D. Gilmer as a

manager of financial services in May 1981. As a condi-

tion of his employment, Gilmer filed an application for

securities registration with the New York Stock Ex-

change. The application contained an arbitration clause

in which he agreed to arbitration of any employment dis-

pute, including termination. Gilmer’s employment was

terminated in November 1987, and in August 1988 he

filed an ADEA suit against Interstate in the United

States District Court for the Western District of North

Carolina. Pet. App. 3a-4a.’

Furthermore, EEAC has participated in several cases in this

Court involving proper interpretation of the ADEA, including Pub-

lic Employees Retirement System v. Betts, 109 S.Ct. 2854 (1989);

Harbison-Walker Refractories v. Brieck, cert. dismissed, 487 U.S.

1216 (1988); Trans World Airlines v. Thurston, 469 U.S. 111

(1985); Lorillard v. Pons, 434 U.S. 575 (1978); Shell Oil Co. v.

Dartt, 434 U.S. 99 (1977). See also McLaughlin v. Richland Shoe

Co., 486 U.S. 128 (1988) (standard for willful violations under the

FLSA, Equal Pay Act and ADEA).

2 The decision below, Gilmer v. Interstate/Johnson Lane Corp,,

395 F.2d 195 (4th Cir. 1990), from which the foregoing factual

summary was drawn, is reproduced at Appendix to Petition for

Interstate filed a motion to compel arbitration pursu-

ant to the Federal Arbitration Act (FAA), 9 U.S.C. §1

et seq. The district court denied the motion, and Inter-

state appealed. The Fourth Circuit reversed, concluding

that enforcement of the arbitration agreement was ap-

propriate under the FAA. Using the analysis outlined

by this Court in Shearson/American Express, Inc. v.

McMahon, 482 U.S. 220, 226 (1987), the Fourth Circuit

found no indication of congressional intent to preclude

arbitration in the ADEA’s language, legislative history

or underlying purposes. Pet. App. 3a.

SUMMARY OF ARGUMENT

The Federal Arbitration Act, 9 U.S.C. $1 et seq.,

mandates enforcement of agreements to arbitrate dis-

putes, even when statutory claims are involved. In re-

cent decisions, this Court has expressed increasing confi-

dence in the arbitral process as a means of resolving

claims, rejecting the traditional judicial attitude of hos-

tility tewards arbitration. The Court already has over-

ruled one decision refusing to arbitrate a statutory claim

on this basis.

In contrast, three older decisions involving arbitration

clauses in collective bargaining agreements sharply criti-

cize arbitration as a means of resolving statutory claims

arising out of employment disputes, holding that arbitra-

tion under such circumstances should not be afforded pre-

clusive effect. Because of this Court’s changing view

towards arbitration, and because those older cases in-

volved collective bargaining agreements rather than in-

dividual agreements to arbitrate, those three decisions

should not be applied to the instant case.

As this Court has explained, an arbitration agreement

should be enforced as to statutory claims unless Congress

Certiorari (“Pet. App.“) at la-36a. Citations to the Brief on the

Merits for Petitioner are designated “Br. Pet.”

has shown that it intended to preclude waiver of a ju-

dicial forum. This intent can be shown in any of three

ways—through clear statutory language, legislative his-

tory, or an inherent conflict between arbitration and the

purposes of the statute.

No such intent is shown in the Age Discrimination in

Employment Act. The statutory language and legislative

history are utterly devoid of any mention of arbitration.

Moreover, the purposes of the Act do not conflict with

dispute resolution by arbitration. Individual statutory

rights are safeguarded, and the role of the Equal Employ-

ment Opportunity Commission remains unchanged.

In addition, sound public policy supports the enforce-

ment of agreements to arbitrate. The increasing number

of employment disputes that result in federal lawsuits,

with the resultant overcrowding of the federal dockets,

has prompted the Federal Courts Study Committee to pro-

pose arbitration as a solution. Arbitration offers a faster,

less expensive approach to dispute resolution without sac-

rificing the rights of individuals that the ADEA was in-

tended to protect. When an employee and employer have

agreed to arbitrate their differences, such agreements are

enforceable under the Federal Arbitration Act.

ARGUMENT

I. THE FEDERAL ARBITRATION ACT, BOLSTERED

BY THIS COURT’S INCREASING CONFIDENCE

IN THE ARBITRAL PROCESS, MANDATES EN-

FORCEMENT OF A PRIVATE AGREEMENT TO

ARBITRATE EMPLOYMENT DISPUTES

The case before this Court seeks enforcement under

the Federal Arbitration Act (FAA), 9 U.S.C. §§ 1-15, of

an individual agreement to arbitrate employment dis-

putes. As the court below correctly recognized, this Court’s

earlier decisions in Alexander v. Gardner-Denver Co., 415

US. 36 (1974), Barrentine v. Arkansas-Best Freight

Systems, 450 U.S. 728 (1981), and McDonald v. City of

West Branch, Michigan, 466 U.S. 284 (1984), are inap-

plicable to this case for two important reasons. First,

those cases predate this Court’s series of decisions strongly

endorsing enforcement of private agreements to arbi-

trate, and criticize the arbitral process on grounds later

repudiated by this Court. Second, Gardner-Denver, Bar-

rentine and McDonald all involved arbitration under col-

lective bargaining agreements, and thus are not applicable

to cases involving individual agreements to arbitrate.

A. Judicial Hostility to Arbitration as a Means for

Resolving Statutory Claims Has Been Repudiated

in This Court’s Recent Decisions

1. Mitsubishi (1985), McMahon (1987) and Rodriguez

(1989) Express Increasing Confidence in the

Arbitral Process

The FAA “was designed to overcome an anachronistic

judicial hostility to agreements to arbitrate, which Amer-

ican courts had borrowed from English common law.”

Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, 473

U.S. 614, 625 n.14 (1985) (citations omitted).* The Act

The key provision of the FAA is Section 2, which provides:

A written provision in any maritime transaction or a contract

evidencing a transaction involving commerce to settle by arbi-

reflects a “liberal federal policy favoring arbitration

agreements .. . guaranteeing the enforcement of private

contractual arrangements. Id. at 625 (citations

omitted). Indeed, “‘[t]he preeminent concern of Con-

gress in passing the Act was to enforce private agree-

ments into which parties had entered,’ a concern which

‘requires that [this Court] rigorously enforce agreements

to arbitrate.’” Id. at 625-26.

This Court’s 1985 Mitsubishi opinion is the first in this

Court’s uninterrupted series of decisions enforcing pri-

vate agreements to arbitrate under the FAA even when

statutory claims are involved. Mitsubishi involved an

arbitration agreement contained in an international com-

mercial contract between an automobile manufacturer and

a distributor. Finding no reason to diverge from the fed-

eral policy favoring arbitration merely because the claim

was based on statutory rights, 473 U.S. 626, this Court

ruled the agreement enforceable as to claims under the

Sherman Act, 15 U.S.C. § 1 et seq.

Later, in Shearson/ American Express, Inc. v. McMahon,

482 U.S. 220 (1987), the Court addressed yet another

tration a controversy thereafter arising out of such contract or

transaction, or the refusal to perform the whole or any part

thereof, or an agreement in writing to submit to arbitration an

existing controversy arising out of such a contract, transaction,

or refusal, shall be valid, irrevocable, and enforceable, save upon

such grounds as exist at law or in equity for the revocation of

any contract.

9 U.S.C. § 2.

A number of earlier decisions foreshadowed Mitsubishi and its

progeny. In Moses H. Cone Memorial Hospital v. Mercury Con-

struction Corporation, 460 U.S. 1 (1983), this Court agreed with

the court of appeals that “questions of arbitrability must be ad-

dressed with a healthy regard for the federal policy favoring arbitra-

tion.” 460 U.S. at 24. In Dean Witter Reynolds, Inc. v. Byrd, 470

U.S. 213 (1985), the Court concluded that under the FAA, a motion

to compel arbitration of otherwise arbitrable claims must be granted.

470 US. at 219.

demand for arbitration of statutory claims. There, the

arbitration clause in question was contained in two agree-

ments between securities customers and their broker. Em-

phasizing once again the federal policy favoring arbitra-

tion, the Court held that both a claim under § 10 (b) of

the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b),

and one brought under the Racketeer Influenced and Cor-

rupt Organizations Act (RICO) 18 U.S.C. § 1961 et se.,

must be arbitrated.

In McMahon, this Court cast substantial doubt on its

earlier opinion in Wilko v. Swan, 346 U.S. 427 (1953),

which had held that a judicial remedy for misrepres~nta-

tion under Section 12(2) of the Securities Act of 1933

could not be waived by an arbitration agreement. As ex-

plained in McMahon, the Court ruled in Wilko that the

plaintiff’s waiver of the ‘right to select the judicial forum’

. . . Was unenforceable only because arbitration was

judged inadequate to enforce the statutory rights created

by 5 12 (2).“ 482 U.S. at 228-29. The Court observed in

McMahon that most of the reasons given in Wilko, which

“reflect a general suspicion of the desirability of arbitra-

tion and the competence of arbitral tribunals,” 482 U.S.

at 231, subsequently had been rejected.

Most recently, in Rodriguez de Quijas v. Shearson/

American Express, 490 U.S. 477, 109 S.Ct. 1917 (1989)

this Court conclusively overruled Wilko. The decision

noted that [tjo the extent that Wilko rested on sus-

picion of arbitration as a method of weakening the pro-

tections afforded in the substantive law to would-be com-

plainants, it has fallen far out of step with our current

strong endorsement of the federal statutes favoring this

method of resolving disputes.” 109 S. Ct. at 1920. The

Court ruled that an agreement to arbitrate claims under

the Securities Act of 1933 was enforceable.

2. Gardner-Denver (1974), Barrentine (1981) and

McDonald (1984) Rest on an Outmoded Pre-

sumption of Disfavoring Arbitration” and, in

Any Event, Are Inapplicable to Cases Involving

Individual Agreements To Arbitrate

In light of the strong federal policy favoring arbitra-

tion, as expressed by Congress in the FAA and by this

Court in Mitsubishi, McMahon and Rodriguez, it is im-

portant that the earlier decisions of this Court regarding

arbitrability of statutory claims in the employment con-

text, all of which concerned arbitration under collective

bargaining agreements rather than individual contracts,

not be applied indiscriminately without considering the

impact of this Court’s continuously increasing confidence

in the arbitral process.

In Alexander v. Gardner-Denver, 415 U.S. 36 (1974),

this Court ruled that submission of a claim of employ-

ment discrimination to arbitration under the nondiscrim-

ination clause of a collective bargaining agreement does

not preclude the right to a trial de novo under Title VII

of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.

In Barrentine v. Arkansas-Best Freight Systems, 450 U.S.

728 (1981), the Court concluded that employees could

bring suit under the Fair Labor Standards Act, 29 U.S.C.

§ 201 et se., even though they already had submitted

their claims to a joint grievance committee under the

collective bargaining agreement. Finally, in McDonald v.

City of West Branch, Michigan, 466 U.S. 284 (1984),

the Court refused to allow an arbitration award under

a collective bargaining agreement to have preclusive ef-

fect in a civil rights lawsuit under 42 U.S.C. § 1983.

Petitioner argues strongly that those cases control the

outcome here. Because they rest in substantial part on

concerns about arbitration that predated this Court’s more

favorable view expressed in Mitsubishi, McMahon and

Rodriguez, however, their applicability is highly suspect,

particularly where they are used to contend that in no

circumstances should arbitration be required at all.

In McDonald, the Court articulated the four reasons

set forth in Gardner-Denver and Barrentine for holding

labor arbitration inadequate to protect federally-created

rights. 466 U.S. at 290-292. First, the Court expressed

concern that the expertise of labor arbitrators was lim-

ited to “the law of the shop, not the law of the land,”

Gardner-Denver, 415 U.S. at 57, so that arbitrators would

not be competent to interpret complex legal issues with a

more public focus. Second, the Court observed that where

the contract delimits the arbitrator’s authority, the arbi-

trator may lack the authority to enforce the statute in

question. Third, the Court noted that in the collective

bargaining context, the union, not the employee, controls

the case. Fourth, the Court criticized the arbitral fact-

finding process as inferior to the judicial process.

The dubious viability of these harsh criticisms of the

arbitration process, as well as the inapplicability of these

factors to cases involving individual agreements, were

analyzed in detail in Judge Becker’s cogent dissent in

Nicholson v. CPC International Inc., 877 F.2d 221 (3d

Cir. 1989) (Becker, J., dissenting). Judge Becker care-

fully considered the listed factors in light of this Court’s

more recent decisions taking a more favorable view of

arbitration.

The first and fourth factors, that arbitrators lack the

necessary expertise and that the arbitration procedure

itself is inferior, were explicitly rebuffed by this Court in

McMahon when it criticized the Wilko rationale. In par-

ticular, the Court explained that “[i]n Mitsubishi, for

example, we recognized that arbitral tribunals are read-

ily capable of handling the factual and legal complexities

of antitrust claims, notwithstanding the absence of ju-

dicial instruction and supervision... Likewise, we have

concluded that the streamlined procedures of arbitration

do not entail any consequential restriction on substantive

rights.” 482 U.S. at 232.

In Rodriguez, this Court described “(t]he Court’s char-

acterization of the arbitration process in Wilko [as]

pervaded by what Judge Jerome Frank called ‘the old ju-

dicial hostility to arbitration.’” 109 S. Ct. at 1920. This

appellation is no less applicable to the same characteriza-

tion articulated in Gardner Denver. Accordingly, having

been rejected by this Court, the “outmoded presumption

of disfavoring arbitration proceedings,” id, should not be

resurrected now. As this Court explained in McMahon,

“‘we are well past the time when judicial suspicion of

the desirability of arbitration and of the competence of

arbitral tribunals’ should inhibit enforcement of the [Fed-

eral Arbitration] Act ‘in controversies based on statutes.’ ”

McMahon, 482 U.S. at 226, quoting Mitsubishi, 473 U.S.

at 627.

The second Gardner-Denver factor, that the arbitrator

will enforce the contract, not the law, likewise was repu-

diated by this Court in McMahon as part of its critique

of Wilko. This Court stated unequivocally that “there is

no reason to assume at the outset that arbitrators will

not follow the law; although judicial scrutiny of arbitra-

tion awards necessarily is limited, such review is suf-

ficient to ensure that arbitrators comply with the require-

ments of the statute.” 482 U.S. at 232. Accordingly, as

this Court stated in Mitsubishi, “(bly agreeing to arbi-

trate a statutory claim, a party does not forgo the sub-

stantive rights afforded by the statute; it only submits to

their resolution in an arbitral, rather than a judicial,

forum.” 473 U.S. at 628, quoted in McMahon, 482 U.S.

at 229-30, and Rodriguez, 109 S. Ct. at 1920.

The fourth Gardner-Denver factor, that the arbitral

forum is inadequate to enforce individual statutory

rights because of union control of the process, is wholly

inapplicable to the case at bar. Gardner-Denver, Barren-

tine, and McDonald all dealt with arbitration under col-

lective bargaining agreements, and all three recognized

the tension between the collective bargaining process, in

which rights are negotiated and arbitrated by unions on

behalf of the group, and individual statutory guarantees

of specific substantive rights. See, e.g., Barrentine, 450

U.S. at 734-35. Although Gardner-Denver expressed con-

cern that the union may subjugate the rights of the in-

dividual to the rights of the group, this concern does not

apply where, as here, the arbitration agreement was

= with the individual employee and no union is in-

volved.

Moreover, Gardner-Denver, Barrentine, and McDonald

never discussed the applicability of the FAA—in all like-

lihood because of this Court’s strong preference for using

§ 301 of the Labor-Management Relations Act of 1947,

29 U.S.C. § 185, rather than the FAA, to analyze collec-

tive bargaining agreements.’ Thus, in those cases the

Court did not have occasion to address the federal policy

favoring arbitration established by the FAA.

Accordingly, to the extent that Gardner-Denver, Bar-

rentine and McDonald reflect the type of judicial dis-

favor to arbitration that the Court has subsequently re-

jected, they should not be applied to the instant case. In

addition, where that disfavor is rooted in a concern that

the arbitration will be dominated by a union unwilling to

champion individual rights, it is inapplicab'e to the in-

dividual arbitration agreement before the Court.“

5 See, e.g., General Electric Company v. Local 205, United Electri-

cal, Radio and Machine Workers of America (U.E.), 353 U.S. 547,

548 (1957).

*The argument has been made that this Court’s opinion in

Atchison, Topeka and Santa Fe Railway Company v. Buell, 480 U.S.

557 (1987), decided after Mitsubishi, somehow reaffirms the contin-

uing applicability of Gardner-Denver and its progeny to individual

statutory claims. Buell, however, is yet another collective bargain-

ing case, and inapplicable solely on that basis.

B. The Recent EEOC Pronouncement Regarding Arbi-

tration of ADEA Claims Is Not Entitled 0

Deference

The recent EEOC Policy Guidance regarding arbitra-

tion of ADEA claims, EEOC Notice No. N-915-060

(August 29, 1990) (hereinafter “EEOC Notice”), should

not be accorded any weight by this Court. The EEOC

Notice takes the position advocated by Petitioner in this

case that Gardner-Denver, Barrentine and McDonald

preclude enforcement of an agreement to arbitrate claims

under the ADEA. The Commission notes that Gardner-

Denver involved a collective bargaining agreement, but

concludes that Gardner-Denver should not be limited to

its facts. EEOC Notice at 3 n. 4.

Unlike contemporaneous and constant agency inter-

pretations of statutory language, the EEOC Notice is

entitled to no special deference. Cf. Public Employees

Retirement Systems of Ohio v. Betts, 109 S. Ct. 2854,

2863 (1989) (noting that EEOC regulation for which

deference was claimed was not, in fact, adopted con-

temporaneously with the ADEA’s enactment but took its

present form more than ten years later). Here, the

agency interpretation occurred a full twenty-three years

after the ADEA was passed, and conveniently was pre-

pared in time for this Court’s consideration of the case.

It, therefore, deserves no special deference from this

Court.

C. The Federal Arbitration Act Is Applicable to Indi-

vidual Employment Agreements

The three amici curiae filing briefs in support of Peti-

tioner have argued that the Federal Arbitration Act is

inappliceble to individual agreements to aribtrate. To the

extent that such arguments may be relevant to the in-

stant case,’ they are incorrect, according to numerous

consistent interpretations by the courts of appeals.

7 As noted in Respondent’s Motion To Strike Portions Of Briefs

Of Amici Curiae Filed In Support Of Petitioner, this issue was not

—

— —

Section 1 of the FAA, which defines maritime trans-

actions“ and commerce“ for purposes of the FAA and

outlines exceptions to the statute, states in pertinent

part, “. . . nothing herein contained shall apply to con-

tracts of employment of seamen, railroad employees, or

any other class of workers engaged in foreign or inter-

state commerce.” 9 U.S.C. §1. As explained in detail

by the Third Circuit in Tenney Engineering, Inc. v.

United Electrical Radio & Machine Workers of America,

(U.E.) Local 437, 207 F.2d 450 (3d Cir. 1953), Con-

gress’ description of the types of workers excluded from

FAA coverage is crucial. Under the statutory construc-

tion principle of ejusdem generis, the Third Circuit rea-

soned, specific identification of two groups of workers

directly engaged in the transportation of goods in inter-

state commerce delimits the following phrase “or any

other class of workers engaged in foreign or interstate

commerce” to workers who are likewise occupied in the

movement of goods in commerce. Id. at 452.“

Subsequent decisions of the courts of appeals have re-

mained consistent with Tenney, adopting the Third Cir-

cuit’s analysis and limitation of the FAA exclusion in

cases involving both collective bargaining agreements and

raised by Petitioner below, nor was it presented to this Court, and

thus should not be addressed by the Court.

Thus, this Court’s footnote in United Paperworkers International

Union, AFL-CIO v. Misco, Inc., 484 U.S. 29, 40 n.9 (1987), is not

incompatible with the Tenney holding. Applying the FAA standard

of reviewability to a labor arbitration award, this Court noted, “The

Arbitration Act does not apply to ‘contracts of employment of .. .

workers engaged in foreign or interstate commerce,’ 9 U.S.C. § 1, but

the federal courts have often looked to the Act for guidance in labor

arbitration cases.” The Court in Misco was not ruling on the scope

of the FAA exclusion. Moreover, under Tenney, it can fairly be said

that collective bargaining agreements in the transportation industry,

which encompasses a large number of such agreements, are excluded

from the FAA.

individual agreements to arbitrate.’ Indeed, using the

Tenney analysis, courts have refused to apply the Sec-

tion 1 exclusion to individual agreements to arbitrate

executed dy employees who, as here, work in the securi-

ties industry, on the grounds that they are not involved

in the transportation of goods in interstate commerce.

See Dickstein v. DuPont, 443 F.2d 783, 785 (1st Cir.

1971). See also Stokes v. Merrill Lynch, Pierce, Fenner

E Smith, Inc., 523 F. 2d 433, 436 (6th Cir. 1975) (plain-

tiff account executives “do not seriously contend that

they fall within the exception .). This Court itself

has applied the FAA to arbitration agreements contained

in an individual contract of employment substantially

similar to the one Gilmer signed. Perry v. Thomas, 482

U.S. 483 (1987) (State statute permitting lawsuits for

collection of wages regardless of the existence of an ar-

bitration agreement is pre-empted by the FAA).

Given the clarity of the statutory language, there is

no need to probe the legislative history to try to create a

contrary result. United Air Lines v. McMann, 434 U.S.

192, 198-99 (1977) [Legislative history. . . is irrel-

evant to an unambiguous statute.”). Accordingly, the

lengthy discussions of the FAA legislative history offered

by Gilmer’s amici can be disregarded.

® See, e.g., Miller Brewing Company v. Brewery Workers Local

Union No. 9, AFL-CIO, 739 F.2d 1159 (7th Cir. 1984), cert. denied,

469 U.S. 1160 (1985) (Section 1 exclusion “limited to workers

employed in the transportation industries”); Erving v. Virginia

Squires Basketball Club, 468 F.2d 1064 (2d Cir. 1972) (professional

basketball player not involved in the transportation industry and

thus not excluded from FAA) ; Signal-Stat Corporation v. Local 475,

United Electrical, Radio and Machine Workers of America (UE),

235 F.2d 298 (2d Cir. 1956) (manufacturing workers not engaged

in commerce, so that collective bargaining agreement not excluded

by Section 1); Hydrick v. Management Recruiters International,

Inc., 738 F. Supp. 1434 (N.D. Ga. 1990) (stating “Indeed, if Con-

gress had intended to exclude all employment contracts from the

Act, it would have been unnecessary to identify specific categories

of workers.” Id. at 1435).

— Se Sa

II. VOLUNTARY ARBITRATION OF ADEA CLAIMS IS

NOT INCONSISTENT WITH THE PURPOSES OF

THE ACT AND IS SUPPORTED BY SOUND PUB-

LIC POLICY

A. The FAA Requires Arbitration of Statutory Claims

Unless Congress Intended Otherwise

The FAA, “standing alone, . . mandates enforcement

of agreements to arbitrate statutory claims,” and only a

contrary statement from Congress will override the

FAA. McMahon, 482 U.S. at 226. In McMahon, this

Court clarified the framework for evaluating the enforce-

ability of agreements to arbitrate statutory claims. The

groundwork for this analysis was laid in Mitsubishi,

where the Court stated, “We must assume that if Con-

gress intended the substantive protection afforded by a

given statute to include protection against waiver of the

right to a judicial forum, that intention will be deducible

from text or legislative history.” 473 U.S. at 628. In

McMahon, the Court restated that Congressional intent

to override the FAA must be ascertainable from the

statutory language or legislative history, “or from an

inherent conflict between arbitration and the statute’s

underlying purposes.” McMahon, 482 U.S. at 227 (cita-

tions omitted). The burden of demonstrating such Con-

gressional intent is on the party who opposes arbitra-

tion. Id.

B. The ADEA Does Not Preclude Voluntary Arbi-

tration

The court below correctly concluded that Congress re-

vealed no such intent in the Age Discrimination in Em-

ploymet Act of 1967 (ADEA), 29 U.S.C. § 621 et seq.

Pet. App. 7a. As the Fourth Circuit noted, even the

Third Circuit, which reached a result contrary to the de-

cision below in Nicholson v. CPC International, Inc., 877

F.2d 221 (3d Cir. 1989), had to admit that neither the

ADEA’s statutory language nor its legislative history

mentioned arbitration, so that it was “forced to ‘draw in-

ferences from Congress’ actions.’” Pet. App. 8a, quoting

Nicholson, 877 F.2d at 197. Accordingly, under the

McMahon analysis, the ADEA can be held to prohibit

waiver of a judicial forum only if arbitration conflicts

with the purposes of the statute.

The stated purposes of the ADEA are “to promote em-

ployment of older persons based on their ability rather

than age; to prohibit arbitrary age discrimination in

employment; to help employers and workers find ways

of meeting problems arising from the impact of age on

employment.” 29 U.S.C. § 621 (b). As the court below

accurately determined, there is no “inherent conflict be-

tween arbitration and the [ADEA’s] underlying pur-

poses” that would signal Congressional intent to preclude

waiver of a judicial forum for ADEA claims. Pet. App.

7a.

1. Arbitration Can Protect Individual Rights

To the extent that vindication of individual rights is a

purpose of the ADEA, this Court’s recent decisions re-

veal that arbitration offers no less valuable a remedy

than the judicial process outlined in the statute. As

noted above, this Court repeatedly has pointed out that

“bly agreeing to arbitrate a statutory claim, a party

does not forgo the substantive rights afforded by the

statute; it only submits to their resolution in an arbitral,

rather than a judicial, forum.” 473 U.S. at 628, quoted

in McMahon, 482 U.S. at 229-30, and Rodriguez, 109 S.

Ct. at 1920. These substantive rights are well preserved

by the arbitration process. One court explained the pro-

cedural safeguards available when ADEA claims are ar-

bitrated as follows:

The commercial arbitration procedures are substan-

tially similar to those in a judicial forum, . and

the arbitrator has sufficient power to structure a

remedy to eliminate age discrimination. ... An ar-

bitration decision under the Federal Arbitration Act

—— eee

is explicitly subject to review in certain circum-

stances. . .. In addition, arbitral awards may be

overturned if in manifest disregard of the law.

Pierce v. Shearson Lehman Hutton, 52 Fair Emp. Prac.

Cases (BNA) 1882, 1884, appeal dismissed for lack of

jurisdiction, No. 90-2079 (7th Cir. September 24, 1990)

(stayed by district court pending outcome of Gilmer)

(citations omitted). See also McMahon, 482 U.S. at 231-

32 (confirming sufficiency of arbitration procedures and

remedies ) Even Gardner-Denver, while requiring a

trial de novo after arbitration under a collective bar-

gaining agreement, acknowledged that an arbitration de-

cision could “give[] full consideration to an employee’s

Title VII rights,” and that such a decision should be

given “great weight” by the court. Gardner-Denver, 415

US. at 60 n.21.

It is true that the ADEA incorporates by reference the

enforcement provisions of the Fair Labor Standards Act

(FLSA). 29 U.S.C. § 626(b). It is also true that this

Court’s decision in Barrentine held that employees could

bring suit under the FLSA, 29 U.S.C. § 201 et seq., even

though they already had submitted their claims to a joint

grievance committee under the collective bargaining

agreement. Barrentine, however, does not control the out-

come of this case.

First, it is clear that Congress incorporated the FLSA

enforcement scheme into the ADEA not because it pre-

ferred a judicial r2medy, but merely “for reasons of ex-

pediency,” relegating ADEA charges to the Department

of Labor Wage and House Division rather than the then-

overworked Equal Employment Opportunity Commission

(EEOC).** Moreover, while the FLSA provisions incor-

10 These provisions include recordkeeping requirements, available

remedies, including the statutory cause of action, and the statute of

limitations. 29 U.S.C. §§ 211, 216 and 217.

11 Note, A Test of Arbitrability: Does Arbitration Provide Ade-

quate Protection for Aged Employees? 35 Villanova L. Rev. 389, 422

and n.171 (1990).

porated into the ADEA provide a judicial remedy, two

other ADEA sections require the EEOC to attempt to

resolve the parties’ differences through conciliation, con-

ference and persuasion—when a charge is filed, 29 U.S.C.

§ 626(d) (2), and before the EEOC can file its own law-

suit. 29 U.S.C. § 626(b). Accordingly, the statute gives

substantial credence to efforts to resolve claims without

litigation, a form of “voluntary dispute resolution.”

Finally, as noted earlier, Barrentine involves arbitration

under a collective bargaining agreement, rather than an

individual agreement to arbitrate as presented here.

2. Arbitration Does Not Interfere with the EEOC’s

Enforcement Role

Petitioner also argues that permitting employees to

choose compulsory arbitration will undermine the

EEOC’s role in the statutory scheme to eliminate dis-

crimination in employment. (Br. Pet. 15). This argu-

ment mischaracterizes the part the EEOC plays in che

process.

The EEOC does not, and could not, handle all poten-

tial ADEA claims. First, employees are permitted to

waive entire ADEA claims without EEOC involvement.”

Indeed, Congress recently amended the ADEA to clarify

the standards by whith a waiver will be considered

“knowing anc voluntary” and therefore valid. Older

Workers’ Bene Protection Act, Pub. L. 101-433

(1990). While early drafts of the bill would have re-

12 Bormann v. AT & T Communications, Inc., 875 F.2d 399, 402

(2d Cir.), cert. denied, 110 S. Ct. 292 (1989); Cirillo v. Arco

Chemical Company, 862 F.2d 448, 451 n.1 (3d Cir. 1988); O’Hare

v. Global Natural Resources, Inc., 898 F.2d 1015, 1016 (5th Cir.

1990); Runyan v. National Cash Register Corp., 787 F.2d 1039

(6th Cir.), cert. denied, 479 U.S. 850 (1986); Lancaster v. Buerkle

Buick Honda Co., 809 F.2d 539, 540 (8th Cir.), cert. denied, 482

U.S. 928 (1987). See also Dorosiewicz v. Keyser-Roth Hosiery, Inc.,

No. 86-3163 (4th Cir. June 24, 1987) (unpublished). But see

Gormin v. Brown-Forman Corp., 744 F. Supp. 1100 (M.D. Fla.

1990), appeal dockeied, No. 90-3719 (llth Cir. August 8, 1990).

quired EEOC supervision of such waivers, the final bill

does not.“ Just as nothing prohibits an employee from

voluntarily waiving ADEA rights in toto or from re-

solving an ADEA dispute without EEOC participation,

nothing in the ADEA prevents an employee from elect-

ing an arbitral rather than a judicial forum to resolve

disputes. Indeed, as one federal judge has stated in a

related context, “There is no suggestion in the statute

or the circumstances leading to its enactment that when

Congress gave ERISA plaintiffs ‘ready access’ to the fed-

eral courts, it was issuing an invitation to plaintiffs that

they could not refuse.” Bird v. Shearson Lehman/

American Express, Inc., 871 F.2d 292, 299 (2d Cir.)

(Cardamone, J., dissenting), vacated and remanded, 110

S. Ct. 225 (1989). The same holds true for the ADEA.

Moreover, an employee’s election of arbitration as the

forum for resolving an individual dispute does not pre-

clude the EEOC from becoming involved in the case. As

Judge Becker explained in detail in his dissent in Nichol-

son, m agreement to arbitrate cannot bar the EEOC

frvia pursuing an investigation and seeking appropriate

remedies. Nicholson, 877 F.2d at 238 and n.8 (Becker,

J. dissenting). Indeed, the FAA by its terms applies only

to lawsuits, not administrative proceedings, so that an in-

dividual would not be precluded from filing a charge.

9 U.S.C. § 3. Further, the arbitration agreement is bind-

ing only upon the parties to that agreement, not on third

parties such as the EEOC.

18 Compare S. 2856, 100th Cong., 2d Sess., 134 Cong. Rec. 814509

(daily ed. October 4, 1988), H.R. 5500, 100th Cong., 2d Sess., 134

Cong. Rec. H10154 (daily ed. October 12, 1988), and S. 54, 101st

Cong., Ist Sess., 135 Cong. Rec. S168 (daily ed. January 25, 1989)

(all requiring EEOC supervision for a waiver to be valid).

3. “Legislative History” of Unenacted Legislation

Is Not Germane to this Case and Cannot Evince

Congressional Intent

Petitioner cites language from the Conference Report

on the vetoed Civil Rights Act of 1990 as “evidence” of

congressional intent that ADEA claims not be subject to

arbitration. The quoted language opines that arbitration

agreements which encompass Title VII claims, whether in

a collective bargaining agreement or private contract, do

not preclude resort to the Title VII enforcement provi-

sions. Br. Pet. 14, citing Conf. Rep. No. 856, 101st

Cong., 2d Sess 26 (1990). The reference does not

strengthen Petitioner’s position for several reasons. The

referenced legislation has not become law, and thus is

not considered as part of the congressional intent relevant

to statutory construction of the ADEA.

Moreover, the quoted language does not reference the

ADEA, even though other portions of the legislation

sought to amend the ADEA by changing the timely fil-

ing requirements for charges and individual lawsuits.

Conf. Rep. No. 856, 101st Cong., 2d Sess. 12. Thus,

the ADEA logically could have been mentioned in the

conference discussion of arbitration had the Conference

Committee intended also to include the ADEA.” Ac-

cordingly, while the Conference Committee easily could

have included the ADEA in its discussion of arbitration,

it apparently chose not to do so. In short, this bit of his-

tory is irrelevant in the instant case, where the statute

in question is the Age Discrimination in Employment

Act, not Title VII.

14 President Bush vetoed the bill, which would have made exten-

sive amendments to Title VII, on October 22, 1990. Veto Message on

S. 2104—Message from the President—PM 152. 136 Cong. Rec.

816457 (October 22, 1990).

15 In addition, as discussed extensively above, the quoted state-

ment goes substantially beyond Gardner-Denver, Barrentine and

McDonald, which dealt solely with arbitration clauses in collective

bargaining agreements, and thus cannot be considered as merely an

endorsement of current law.

In any event, comments by members of Congress sub-

sequent to the ADEA’s enactment in 1967 are not rele-

vant to establish the intent of the Congress that passed

the ADEA. “The retroactive wisdom provided by the sub-

sequent speech of a member of Congress stating that yes-

terday we meant something that we did not say is an

ephemeral guide to history .... What happened after a

statute was enacted may be history, and it may come

from members of Congress, but it is not part of the leg-

islative history of the original enactment.” Rogers v.

Frito-Lay, Inc. and Moon v. Roadway Express, Inc., 611

F.2d 1074, 1080 (5th Cir.), cert. denied, 449 U.S. 889

(1980). Clearly, the legislative history of the ADEA is

that which occurred prior to its enactment, and it is the

ADEA that forms the basis for the instant action. Thus,

pronouncements concerning measures that have not been

enacted as amendments to the ADEA, and particularly

those that have not become law at all, are of little value

in interpreting the ADEA, which was passed over twenty

years ago.

Indeed, this Court already has rejected comments re-

garding unenacted amendments to the ADEA itself as

indicative of congressional intent. In United Air Lines

v. McMann, 434 U.S. 192 (1977), holding that the ADEA

as it then existed did not prohibit mandatory retirement

pursuant to a bona fide plan established prior to the Act,

the majority expressly rejected the contention that com-

mittee reports on pending legislation to amend the ADEA

to prohibit mandatory retirement could be used to deter-

mine congressional intent concerning the ADEA, stating,

“Legislative observations 10 years after passage of the

Act are in no sense part of the legislative history.” 434

U.S. at 200, n.7. See also Bormann v. AT & T Com-

munications, Inc., 875 F. 2d at 402 (“the introduction of

these [ADEA waiver] bills .. are not an authoritative

interpretation of what the ADEA meant when the stat-

ute was enacted in 1967.”). See also Pierce-v. Under-

wood, 487 U.S. 552, 567-68, (1988) (subsequent Com-

mittee Report language contrary to settled law not con-

trolling on the Court).

4. Sound Public Policy Supports Arbitration of

Employment Disputes

Voluntary binding arbitration of employment disputes

is consistent with the developing theory supporting arbi-

tration as a method for relief of the serious overcrowding

of the federal courts. The Federal Courts Study Com-

mittee, which seeks to offer solutions to the problems of

the federal judiciary, has observed that the number of

employment discrimination cases filed in the federal courts

has increased by over two thousand percent since 1969.

Report of the Federal Courts Study Committee at 61

(April 2, 1990). Recognizing this extraordinary growth

to be an important factor in the current overcrowding in

the courts, the Committee recommended that the EEOC

be authorized to conduct voluntary binding arbitration of

Title VII cases. Jd. at 60-61. The Committee’s position

underscores the need to reduce, not increase, the number

of court proceedings in employment discrimination cases.

The Committee reasoned: _

One measure to assist these workers may lie outside

the federal judiciary: voluntary arbitration by the

EEOC. Arbitration would benefit those employers

and employees who would prefer to try to settle their

dispute before the agency rather than—or before

trying—federal court litigation. And it might pro-

vide some caseload relief to the federal courts.

Id. at 61.

“Congress passed the Federal Arbitration Act... to

help legitimate arbitration and make it more readily use-

ful to disputants. The hope has long been that the Act

could serve as therapy for the ailment of the crowded

docket.” Securities Industry Association v. Connolly, 883

F.2d 1114, 1116 (Ist Cir. 1989), cert. denied, 110 S.Ct.

2559 (1990). Arbitration provides an extrajudicial means

by which disputes that typically arise in an employment

setting, such as whether there existed proper cause for

discharge, can be resolved in a more efficient and less

expensive manner without further burdening our over-

crowded court system. Given the increasing number of

civil cases that are filed in federal district courts, it is

essential that alternative methods of resolving disputes

short of litigation be explored and encouraged. In cases

such as this, where an employee and employer have vol-

untarily agreed to submit their differences to a neutral

arbitrator for resolution under a procedure that offers

full and pair protection of substantive rights in a less

costly and cumbersome forum than the court system, such

an agreement should be encouraged, and indeed, must be

enforced under the Federal Arbitration Act. In this man-

ner, the Court can foster the preservation of scarce ju-

dicial resources without sacrificing the rights of individ-

uals that the ADEA was designed to protect.

CONCLUSION

For the foregoing reasons, EEAC respectfully submits

that the decision of the United States Court of Appeals

for the Fourth Circuit should be affirmed.

December 19, 1990

Respectfully submitted,

ROBERT E. WILLIAMS

DouGias S. MCDOWELL

ANN ELIZABETH REESMAN *

McGUINEss & WILLIAMS

1015 Fifteenth Street, N.W.

Suite 1200

Washington, D.C. 20005

(202) 789-8600

Attorneys for Amicus Curiae

Equal Employment Advisory

Council

DONALD L. GOLDMAN

1400 Statler Office Tower

1127 Euclid Avenue

Cleveland, Ohio 44115-1638

(216) 696-1122

Attorney for Amicus Curiae

Professional Employment

Research Council

* Counsel of Record

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