Amicus Curiae Brief — Wright v. Universal Maritime Service Corp.

IN THE

Supreme Court of the United

OCTOBER TERM,1997 —

CEASAR WRIGHT,

8 Petitioner,

UNIVERSAL MARITIME SERVICE CoRp.;

STEVENS SHIPPING & TERMINAL Co.;

STEVEDORING SERVICES OF AMERICA;

RYAN-WALSH, INC.;

STRACHAN SHIPPING Co.;

CERES MARINE TERMINALS, INC.; and

SOUTH CAROLINA STEVEDORES ASSOCIATION,

Respondents.

On Writ of Certiorari to the

United States Court of Appeals

for the Fourth Circuit

BRIEF AMICI CURIAE OF THE

EQUAL EMPLOYMENT ADVISORY COUNCIL,

THE LABOR POLICY ASSOCIATION,

and THE EMPLOYERS GROUP

IN SUPPORT OF RESPONDENTS

JEFFREY A. BERMAN ROBERT E. WILLIAMS *

SIDLEY & AUSTIN ANN ELIZABETH REESMAN

555 West Fifth Street DANIEL V. YAGER

Los Angeles, CA 90018-1010 McGUINESS & WILLIAMS

(213) 896-6000 1015 Fifteenth Street, N.W.

Attorney for Amicus Curiae Suite 1200

Employers Group Washington, D.C. 20005

(202) 789-8600

Attorneys for Amici Curiae

Equal Employment

Advisory Council and

Labor Policy Association

* Counsel of Record

WILSON - Eres PRINTING Co. INC. - 789-0096 - WASHINGTON. D.C. 20001

BEST AVAILABLE COPY =

TABLE OF CONTENTS

TABLE OF AUTHORITIES

INTEREST OF THE AMICI CURA

STATEMENT OF THE CASE

SUMMARY OF ARGUMENT f

ARGUMENT

I.

THE COURT BELOW PROPERLY HELD

THAT A COLLECTIVELY-BARGAINED

AGREEMENT TO ARBITRATE ALL DIS-

PUTES ARISING OUT OF AN EMPLOY-

MENT RELATIONSHIP IS ENFORCEABLE

WITH RESPECT TO STATUTORY CLAIMS

IN THE SAME MANNER AS THE INDI-

VIDUALLY-BARGAINED AGREEMENT IN

GILMER

A. Agreements to Arbitrate A Re-

lated Disputes Stand on the Same Footing

as Other Contracts and Are Enforceable

With Respect to Statutory Claims ............

. An Arbitration Agreement Negotiated and

Executed by a Duly-Selected Collective-

Bargaining Agent Is Binding on the Em-

ployees on Whose Behalf It Was Made

STRONG FEDERAL POLICIES FAVOR THE

ENFORCEMENT OF £COLLECTIVELY-

BARGAINED AGREEMENTS TO ARBI-

TRATE EMPLOYMENT-RELATED DIS-

PUTES, INCLUDING STATUTORY CLAIMS

A. Enforcement of Agreements to Submit Stat-

utory Claims to Arbitration Is Fully Con-

sistent With the EEO Laws’ Policy of Pro-

tecting Individuals Against Discrimination

. Federal Policies Favoring Enforcement of

Voluntary Agreements to Arbitrate Must

Prevail Over Outmoded Suspicion of Arbi-

tration

CONCLUSION .

ii

TABLE OF AUTHORITIES

CASES Page

Air Line Pilots Association, International v.

ONeill, 499 U.S. 65 (19919 —————————9 17-18

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

10 —T—T—ͤ—„—— — 18. 19

Austin v. Owens-Brockway Glass Container, 78

F.3d 875 (4th Cir.), cert. denied, 117 S. Ct. 432

1 3. 5

Barrentine v. Arkansas-Best Freight System, Inc.,

e.. 20

Fairhaven Properties, 314 N. L. R. B. 763 (1994) 14

Gilmer v. Interstate / Johnson Lane Corp., 500 U.S.

rn ptgtlinenenoneiogoasel passim

Great Western Mortgage Corp. v. Peacock, 110

F.3d 222 (3d Cir.), cert. denied, 118 S. Ct. 299

r 3-4

Hughes Tool Co., 56 N. L. R. B. 981 „ enf'd

as modified, 147 F.2d 69 (5th Cir. 1945) 7

Humphrey v. Moore, 375 U.S. 335 (1964) 8.18

J. I. Case Co. v. NLRB, 321 U.S. 332 (1944) 12

Livadas v. Bradshaw, 512 U.S. 107 (1993) 4

McKennon v. Nashville Banner Publishing Co., 513

RET AIS aS eee 4

Medo Photo Supply Corp. v. NLRB, 321 U.S. 678 5

een

Metropolitan Edison Co. v. NLRB, 460 U.S. 693

. 8,17

NLRB v. Boss Manufacturing Co., 118 F. 2d 187

(7th Cir. 1941) 8 12

NLRB v. Katz, 369 US. 736 (1962) 6 12

NLRB v. Montgomery Ward & Co., 133 F.2d 676

RE ee SS 12

Republic Steel Corp. v. Maddor, 379 U. 8. 650

r a 11

Securities Industry Association v. Connolly, 883

F.2d 1114 (Ist Cir. 1989), cert. denied, 495 U.S.

D .... 8. 21

United Electrical, Radio & Machine Workers v.

NLRB, 409 F.2d 150 (D.C. Cir. 196997 12

iii

TABLE OF AUTHORITIES—Continued

Page

United Steelworkers of America v. American Man-

ufacturing Co., 363 U.S. 564 (1960) 15

United Steelworkers of America v. Enterprise

Wheel & Car Corp., 363 U.S. 593 (1960) 15

United Steelworkers of America v. Warrior & Gulf

Navigation Co., 363 U.S. 574 (1960) 15

Vaca v. Sipes, 386 U.S. 171 (1967) 8, 11,18

WJA Realty Ltd. Partnership, 308 N.L.R.B. 728

ER Re NEL © OO Ee 12

DOCKETED CASES

Albertson's Inc. v. United Food and Commercial

Workers Union, Civ. No. 97-35500 (9th Cir.) .... 4

STATUTES

Age Discrimination in Employment Act (ADEA),

ee ts ᷑ê . 3,9

Americans with Disabilities Act (ADA), 42 U.S.C.

r 7... 3

e Ee a 15

Federal Arbitration Act (FAA), 9 U.S.C. 81

0 9

National Labor Relations Act (NLRA), 29 U.S.C.

fo ae ee 3

e oS ee 6,11

Racketeer Influenced and Corrupt Organizations

Act (RICO), 18 U.S.C. § 1961 et seg. . 17

Section 110 of the Civil Rights Act of 1991, Pub.

L. No. 102-166, 105 Stat. 1071, 10111 15

Section 301 of the Labor-Management Relations

r x 10, 15

Section 10 (b) of the Securities and Exchange Act

of 1934, 15 U.S.C. § 78 (b) a PE ELAR Paes 16-17

Section 12(2) of the Securities Act of 1933, 15

e EE nS 17

Sherman Act, 15 U.S.C. §§ 17 — 16

Title VII of the Civil Rights Act of 1964, 42

U.S.C. § 2000e et seq.

iv

TABLE OF AUTHORITIES—Continued

MISCELLANEOUS Page

The Developing Labor Law (Patrick Hardin ed.,

Le 12

Federal Courts Study Committee, Report of the

Federal Courts Study Commitee (1990) 19

IN THE

Supreme Court of the United States

OCTOBER TERM, 1997

No. 97-889

CEASAR WRIGHT,

V.

UNIVERSAL MARITIME SERVICE Cor., —

Petitioner,

BRIEF AMICI CURIAE OF THE

EQUAL EMPLOYMENT ADVISORY COUNCIL,

THE LABOR POLICY ASSOCIATION,

and THE EMPLOYERS GROUP

IN SUPPORT OF RESPONDENTS

The Equal Employment Advisory Council (EEAC),

the Labor Policy Association (LPA), and the Em-

ployers Group respectfully submit this brief as amici

curiae. Letters of consent from all parties have been

1 Counsel for the amici authored the brief in its entirety.

No person or entity other than the amici or their counsel

made a monetary contribution to the preparation or submis-

sion of the brief.

2

filed with the Clerk of the Court. The brief urges

this Court to affirm the decision of the court below

and, thus, supports the position of the respondents,

Universal Maritime Service Corporation et al.

INTEREST OF THE AMICI CURIAE

EEAC is an association of employers formed in

1976 to promote sound programs to end employment

discrimination. Its members include more than 300

of the nation’s largest private employers. Its directors

and officers include many of industry’s leading ex-

perts on equal employment opportunity and affirma-

tive action. Their combined experience gives EEAC

valuable insight into the practical, as well as legal

aspects of equal employment opportunity (EEO) pol-

icies and practices.

LPA is an organization of the senior human re-

sources officers of more than 250 of the nation’s largest

companies, collectively employing more than 12 mil-

lion Americans. Since its founding in 1939, LPA has

been concerned exclusively with the development and

implementation of laws and public policies affecting

human resources practices in the private sector.

LPA’s mission is to ensure that such laws and policies

are sound, practical, and responsive to the needs of

the modern workplace.

The Employers Group, headquartered in California,

is one of the nation’s oldest and largest human re-

sources management associations. It represents nearly

5,000 companies of all sizes in every industry, em-

ploying in the aggregate approximately 2.5 million

employees. Formerly known as the Merchants & Man-

ufacturers Association and the Federated Employers,

the Employers Group has been involved as amicus

curiae in many significant employment cases.

3

The amici’s members are employers subject to the

Americans with Disabilities Act, 42 U.S.C. § 12101

et seq.; Title VII of the Civil Rights Act of 1964, 42

U.S.C. § 2000e et seg.; the Age Discrimination in

Employment Act, 29 U.S.C. § 621 et seqg., and other

EEO laws, as well as to the National Labor Relations

Act, 29 U.S.C. § 151 et seg. Many of them have con-

tracts with their employees governing some or all

terms and conditions of employment. Some of these

contracts have been arrived at through collective bar-

gaining with employee representatives, while others

are products of direct dealings with unrepresented

employees. Many such contracts contain provisions

requiring arbitration of employment-related claims

and disputes.

The amici’s members have an ongoing interest in

preserving the enforceability of agreements calling for

arbitration of employment-related disputes, whether

arrived at through collective or individual bargaining.

Arbitration provides a fair, efficient, and effective

means of resolving discrimination claims and other

employment-related issues that otherwise would clog

the courts. Because of their interest in this subject,

the amici have filed friend-of-the-court briefs in nu-

merous cases supporting the enforceability of arbitra-

tion agreements, as well as many other important

issues of employment law.?

2 For example, EEAC filed briefs supporting mandatory

arbitration of statutory discrimination claims in Gilmer v.

Interstate/Johnson Lane Corp., 500 U.S. 20 (1991); Austin

v. Owens-Brockway Glass Container, Inc., 78 F.3d 875 (4th

Cir.), cert. denied, 117 U.S. 482 (1996); and Great Western

Mortgage Corp. v. Peacock, 110 F.3d (3d Cir.), cert.

4

STATEMENT OF THE CASE

Following a 1992 workplace injury, petitioner

Ceasar Wright claimed to be totally and permanently

disabled. After he received a quarter-million dollar

worker’s compensation settlement, however, Wright’s

condition improved unexpectedly, and he reported to

his union hiring hall saying he was ready to return

to work. Over the next few days, he worked for

several different stevedoring firms on referrals from

the union. The firms balked, however, when they

learned that Wright had received a large monetary

settlement for a total and permanent disability. Re-

lying on provisions of the applicable collective-bar-

gaining agreement, they informed the union that

they no longer would accept Wright for employment.

The union protested the stevedoring firms’ decision,

but neither it nor Wright pursued the matter through

the grievance-and-arbitration procedure of the collec-

tive-bargaining agreement. Instead, at the union’s

suggestion, Wright went to a lawyer, with whose

assistance he filed a charge of discrimination with the

U.S. Equal Employment Opportunity Commission

(EEOC) alleging that the firms had discriminated

against him in violation of the Americans with Dis-

abilities Act. Upon receipt of a right-to-sue letter

from the EEOC, Wright sued in federal court on his

ADA claim.

denied, 118 S.Ct. 299 (1997). LPA filed a brief supporting

mandatory arbitration of Fair Labor Standards Act claims

in Albertson's Inc. v. United Food and Commercial Workers

Union, Civ. No. 97-85500 (9th Cir.) (decision pending). The

Employers Group has filed amicus briefs in M Kennon v.

Nashville Banner Publishing Co., 518 U.S. 852 (1995) and

Livadas v. Bradshaw, 512 U.S. 107 (1994).

5

The case was referred to a magistrate judge, who

recommended that it be dismissed because Wright

had failed to submit his claim to arbitration as re-

quired by the collective-bargaining agreement. The

magistrate judge concluded that the case was con-

trolled by the Fourth Circuit’s decision in Austin v.

Owens-Brockway Glass Container, 78 F.3d 875 (4th

Cir.), cert. denied, 117 S. Ct. 432 (1996), which holds

that a collectively-bargained agreement to arbitrate

employment-related claims bars a covered employee

from suing on statutory discrimination claims, at

least without first exhausting arbitration.

The district court agreed with the magistrate

judge and dismissed Wright’s lawsuit. On appeal,

the Fourth Circuit affirmed the dismissal. Relying

on Austin, the Fourth Circuit observed that “collec-

tive bargaining agreements to arbitrate employment

disputes are binding upon individual employees even

when the dispute involves a federal cause of action,“

and that [where such an agreement exists, a failure

to process a claim under the agreement precludes a

court from exercising jurisdiction.” (Pet. App. at

4a). This Court granted certiorari on March 2, 1998.

SUMMARY OF ARGUMENT

It is now settled that when an individual agrees, as

a condition of employment, to submit all employment-

related disputes to arbitration, that agreement stands

“on the same footing as other contracts” and is en-

forceable with respect to statutory discrimination

claims as well as other disputes. Gilmer v. Interstate /

Johnson Lane Corp., 500 U.S. 20 (1991). The central

question in this case is whether the same holds true

when a union makes such an agreement on behalf of

6

employees it represents. The court below properly

concluded that it does.

Under the National Labor Relations Act (NLRA),

a union duly selected by a majority of the employees

in a unit appropriate for collective bargaining is the

exclusive representative of all the employees in such

unit for the purposes of negotiating and entering

into contracts with their employer governing their

“rates of pay, wages, hours of employment, or other

conditions of employment.” 29 U.S.C. §159(a).

Thus, when employees choose a union as their agent,

they authorize it to bind them—both collectively and

individually—to agreements covering the whole gamut

of “terms and conditions of employment.”

It is well settled that a procedure for resolving

employment-related claims and disputes is a “term

or condition of employment”—and thus a mandatory

subject of collective bargaining—within the meaning

of the NLRA. Accordingly, an agreement to adopt

such a procedure lies well within the ambit of sub-

jects on which a union can bind the employeees for

whom it speaks.

This Court has recognized that it is perfectly appro-

priate—and, indeed, consistent with important federal

policies—for an employer and an employee to agree

in advance, as a condition of employment, to “trade[ ]

the procedures and opportunities for review of the

courtroom for the simplicity, informality, and expedi-

tion of arbitration” as the means of resolving any

disputes that may arise out of their employment rela-

tionship, including statutory claims. Gilmer, 500 U.S.

at 31, quoting Mitsubishi Motors Corp. v. Soler

Chrysler-Plymouth, Inc., 473 U.S. 614, 628 (1985).

ee

7

In a unionized setting, however, the only way such

an agreement ordinarily can come into being is

through collective bargaining, for the NLRA bars

employers from dealing directly with union-repre-

sented employees over dispute-resolution procedures.

See, e.g., Hughes Tool Co., 56 N.L.R.B. 981 (1943),

enf’d as modified, 147 F.2d 69 (5th Cir. 1945). Yet,

under the rule the petitioner seeks in this case, a

collectively-bargained agreement to arbitrate statu-

tory claims would be unenforceable against employees

who assert such claims, and hence would be of little or

no value to the employer.

Thus, the rule petitioner seeks would create an

anomaly in employment law. It would make it vir-

tually impossible for union-represented employees and

their employers to exercise the same, basic right that

the unrepresented employee in Gilmer and his em-

ployer exercised with this Court’s approval—i.e., the

right to trade the procedures of the courtroom for the

more efficient, less expensive procedures of arbitration

with respect to statutory claims.

The petitioner and his amici argue that the EEO

laws’ central policy of protecting individuals against

discrimination trumps the NLRA’s central policies of

majority rule and exclusive representation. But there

is no need to decide in this case which of these statu-

tory policies takes precedence, because individuals’

substantive rights under the EEO laws can be pro-

tected as effectively through arbitration as through

judicial processes. As this Court has recognized, an

agreement to arbitrate statutory claims does not

waive any substantive rights afforded by the EEO

laws; it merely submits to their resolution in a differ-

ent forum. Gilmer, 500 U.S. at 26. This is equally

true whether the agreement to arbitrate such claims

was negotiated individually or collectively.

The union’s duty of fair representation under fed-

eral labor law stands as a bulwark against any danger

that individuals’ rights might suffer as a result of

their subordination to collective interests under the

NLRA. See Metropolitan Edison Co. v. NLRB, 460

U.S. 693, 705 (1983); Humphrey v. Moore, 375 U.S.

335, 342 (1964); Vaca v. Sipes, 386 U.S. 171, 177-78

(1967). Thus, majoritarian control over the selection

of the forum for resolving employees’ job-related com-

plaints and charges is fully compatible with effective

protection of their individual, substantive rights under

the EEO laws.

At bottom, most of the arguments supporting the

petitioner’s position in this case rests on the out-

moded “suspicion of arbitration” that this Court de-

nounced in Gilmer, 500 U.S. at 30. Those arguments

run counter to strong federal policies favoring arbi-

tration. The importance of those policies is amplified

in the employment context by the explosive growth of

employment-law litigation in the federal courts. Con-

gress and the judiciary have long recognized that

arbitration can, as one court put it, “serve as therapy

for the ailment of the crowded docket.” Securities

Indus. Ass’n v. Connolly, 883 F.2d 1114, 1116 (1st

Cir. 1989), cert. denied, 495 U.S. 1054 (1990). Given

the current, overwhelming federal caseload, such

“therapy” has never been more appropriate and

necessary.

9

ARGUMENT

I. THE COURT BELOW PROPERLY HELD THAT A

COLLECTIVELY-BARGAINED AGREEMENT TO

ARBITRATE ALL DISPUTES ARISING OUT OF

AN EMPLOYMENT RELATIONSHIP IS ENFORCE-

ABLE WITH RESPECT TO STATUTORY CLAIMS

IN THE SAME MANNER AS THE INDIVIDUALLY-

BARGAINED AGREEMENT IN G/LMER

A. Agreements to Arbitrate Employment-Related Dis-

putes Stand on the Same Footing as Other Con-

tracts and Are Enforceable With Respect to Statu-

tory Claims

In Gilmer v. Interstate/Johnson Lane Corp., 500

U.S. 20 (1991), this Court held that an arbitration

agreement that an individual signed “[a]s a condi-

tion of his employment,” id. at 23, in which he

pledged to submit to arbitration any dispute that

might arise out of his employment or the termination

thereof, was enforceable under the Federal Arbitra-

tion Act (FAA), 9 U.S.C. § 1 et seg., so as to require

him to arbitrate his subsequent claim that his em-

ployer violated his rights under the Age Discrimina-

tion in Employment Act (ADEA), 29 U.S.C. § 621

et seq. In so holding, the Court emphasized that the

federal policy underlying the FAA places arbitration

agreements “on the same footing as other contracts,”

500 U.S. at 24, 33, and makes them enforceable with

respect to statutory claims, the same as with respect

to other types of claims. Id. at 26.9

3 An exception is made where it is shown that Congress

intended to preclude waivers of judicial remedies under a

particular statute. Gilmer, 500 U.S. at 26. However, after a

careful analysis of the text, history, structure and purpose

of the ADEA, this Court found no evidence of intent to

10

The present case involves an arbitration agreement

that is generally similar to the one in Gilmer.* The

only significant difference is that, while Gilmer him-

self signed the document containing his agreement

to arbitrate, petitioner Wright was represented by a

labor union, which negotiated and executed the arbi-

tration agreement in this case as part of a broader

collective-bargaining contract covering Wright and

his cohorts. That distinction, however, should not

affect the enforceability of the agreement. For, as

we show below, an arbitration agreement entered into

on behalf of employees by their duly chosen collective-

bargaining agent is binding on the individuals the

union represents, just as if they had signed the agree-

ment themselves.

Gilmer was an action to enforce an arbitration

agreement under the FAA, but collectively-bargained

arbitration agreements also are enforceable under

Section 301 of the Labor-Management Relations Act,

29 U.S.C. § 185. In Section 301 cases, this Court has

long held that union-represented employees may not

sue in court on claims raising issues covered by a

preclude waivers of judicial remdies under that statute. Id.

at 26-36. As discussed infra p. 13, a similar analysis of the

Americans with Disabilities Act—the statute on which peti-

tioner Wright bases his claim in this case—not only shows it

to be devoid of any evidence of congressional intent to pre-

clude such waivers, but in fact contains an express congres-

sional endorsement of arbitration.

4 As the court below noted, the agreement in this case re-

quired arbitration of “all matters affecting wages, hours, and

other terms and conditions of employment.” (Pet. App. at

4a). In similarly broad language, the agreement in Gilmer

required arbitration of “any dispute, claim or controversy”

arising out of Gilmer’s employment. 500 U.S. at 23.

11

collective-bargaining agreement that contains a griev-

ance and arbitration procedure, at least without ex-

hausting that procedure first. See Republic Steel

Corp. v. Maddox, 379 U.S. 650, 652 (1965); Vaca

v. Sipes, 386 U.S. 171, 184 (1967). Thus, the deci-

sion of the court below holding that Wright’s failure

to pursue his claim through the contractual griev-

ance procedure barred his suit in court is consistent

with well-established labor law principles.

B. An Arbitration Agreement Negotiated and Exe-

cuted by a Duly-Selected Collective-Bargaining

Agent Is Binding on the Employees on Whose

Behalf It Was Made

Section 9(a) of the National Labor Relations Act

(NLHA), 29 U.S.C. § 159(a), provides that “[r]epre-

sentatives designated or selected for the purposes of

collective bargaining by the majority of the employees

in a unit appropriate for such purposes, shall be the

exclusive representatives of all the employees in such

unit for the purposes of collective bargaining in re-

spect to rates of pay, wages, hours of employment,

or other conditions of employment. That sec-

tion embodies two of the NLRA’s most important, cen-

tral concepts. First, it establishes the principle of

exclusive representation—i.e., that a union chosen

5 A proviso to this section states that “any individual em-

ployee or group of employees shall have the right at any time

to present grievances to their employer and to have such

grievances adjusted, without the intervention of the bargain-

ing representative, as long as the adjustment is not incon-

sistent with the terms of a collective-bargaining contract or

agreement then in effect.” A further proviso requires that the

bargaining representative be given an opportunity to be pres-

ent at such adjustment.” 29 U.S.C. § 159 (a).

12

by the majority of the employees in an appropriate

unit is the sole bargaining agent for all the employees

in the unit. Second, it defines the scope of such an

agent’s authority broadly to encompass all matters

relating to “terms or conditions of employment.”

Within that broad ambit, the union can enter into

agreements that are binding not only on itself and the

employer, but on all the employees in the unit it rep-

resents. See J. I. Case Co. v. NLRB, 321 U.S. 332,

338-39 (1944). With respect to such matters, the

employer is prohibited from dealing directly with

employees, or with any other agent on their behalf.

See NLRB v. Katz, 369 U.S. 736, 743 (1962).

It has long been recognized that a procedure for

resolving employment-related complaints or disputes

is a matter falling squarely within the ambit of

“terms or conditions of employment.” See United

Electrical, Radio & Machine Workers v. NLRB, 409

F.2d 150, 156 (D.C. Cir. 1969). See also NLRB v.

Montgomery Ward & Co., 133 F.2d 676 (9th Cir.

1943); NLRB v. Boss Mfg. Co., 118 F.2d 187 (7th

Cir. 1941); WJA Realty Ltd. Partnership, 308

N.L.R.B. 728 (1992). Indeed, a leading labor law

treatise includes grievance and arbitration procedures

in a list of topics that “are now so clearly recognized

to be mandatory subjects of bargaining that no dis-

cussion is required.” The Developing Labor Law 885,

885 n. 192 (Patrick Hardin ed., 3d ed. 1992). Con-

sequently, application of long-settled NLRA princi-

ples dictates the conclusion that the choice of the

forum for resolving any employment-related claims

petitioner Wright or his unit colleagues might raise

was an issue on which their union, as their exclusive

bargaining agent, could make a binding, enforceable

contractual commitment on their behalf.

13

To rule otherwise would destroy the mutuality of

obligations on which collective bargaining depends.

In labor contracts, a provision for arbitration of dis-

putes typically is a quid pro quo for a no-strike/no-

lockout clause. Together these provisions are the keys

to industrial peace. As such, they are among the most

important forms of consideration the parties exchange

in entering into such agreements. If an employer

cannot enforce a collectively-bargained agreement

that all employment-related claims and disputes will

be submitted to arbitration, the empoyer plainly will

have been denied the benefit of its bargain.

Wright and his amici, however, urge this Court, in

effect, to carve out an exception to these bedrock

NLRA principles. They ask the Court to rule that

even if a union is an employee’s duly-chosen, exclu-

sive bargaining agent, the union cannot consent on

the employee’s behalf to an agreement requiring the

employee to submit statutory claims to arbitration.

Such a rule would create an anomaly in employment

law. It effectively would deny union-represented em-

ployees and their employers any practical way to do

what the unrepresented employee in Gilmer and his

employer did with this Court’s subsequent approval—

that is, to trade [] the procedures and opportunities

for review of the courtroom for the simplicity, infor-

mality, and expedition of arbitration” as the means

of resolving statutory claims. Gilmer, 500 U.S. at 31,

quoting Mitsubishi Motors Corp. v. Soler Chrysler-

Plymouth, Inc., 473 U.S. 614, 628 (1985).

Gilmer recognizes that such agreements are entirely

legitimate and enforceable when entered into between

an individual and employer. In a unionized setting,

however, individual employees ordinarily cannot enter

14

into such agreements with their employer on their

own behalf, because the employer cannot by-pass the

union and deal directly with employees on a manda-

tory subject of collective bargaining without violating

the NLRA. See Medo Photo Supply Corp. v. NLRB,

321 U.S. 678 (1944); Fairhaven Properties, 314

N.L.R.B. 763 (1994). Consequently, collective bar-

gaining is the only way in which union-represented

employees ordinarily can trade the procedures of the

courtroom for the more efficient, less costly processes

of arbitration.

Under the rule petitioner seeks in this case, how-

ever, employers would have little or no incentive to

agree to collectively-bargained arbitration procedures

covering statutory claims, because the petitioner’s

rule would make such agreements unenforceable

against individuals who assert such claims. This

Court should reject such an anomalous rule and hold

instead, in keeping with long-established NLRA prin-

ciples, that an arbitration agreement executed by an

employee’s duly-chosen, exclusive bargaining repre-

sentative is binding on the employee and enforceable

like any other contract, just as if the individual

signed it personally.

Il. STRONG FEDERAL POLICIES FAVOR THE EN-

FORCEMENT OF COLLECTIVELY-BARGAINED

AGREEMENTS TO ARBITRATE EMPLOYMENT-

RELATED DISPUTES, INCLUDING STATUTORY

CLAIMS

A. Enforcement of Agreements to Submit Statutory

Claims to Arbitration Is Fully Consistent with the

EEO Laws’ Policy of Protecting Individuals Against

Discrimination

As this Court recognized in Gilmer, strong federal

policies support the enforcement of private agree-

agreemen

Id. at 24, 33. In the context of collective bargaining,

additional strong policy support for enforcement of

Furthermore, the statute under which petitioner

Wright asserted his claim in this case—the Ameri-

cans with Disabilities Act—expressly declares that:

Where appropriate and to the extent authorized

by law, the use of alternative means of dispute

resolution, including . . . arbitration, is encour-

aged to resolve disputes arising under this

chapter.

42 U.S.C. § 12212. Thus, Congress not only has not

expressed an intent to preclude enforcement of agree-

ments to arbitrate claims arising under the ADA,

but has expressed affirmative support for arbitration

as a means of resolving such disputes. Significantly,

Congress enacted the legislation adding this language

to the ADA after this Court handed down its deci-

sion in Gilmer."

United Steelworkers of America v. American Mfg. Co.,

363 U.S. 564 (1960); United Steelworkers of America v.

Warrior & Gulf Navigation Co., 363 U.S. 574 (1960) ; United

Steelworkers of America v. Enterprise Wheel & Car Corp.,

363 U.S. 593 (1960).

7 The above-quoted language of 42 U.S.C. § 12212 was

added to the ADA as Section 110 of the Civil Rights Act of

1991, Pub. L. No. 102-166, 105 Stat. 1071, 1081, which Con-

16

Petitioner and his amici would have this Court

treat these strong federal policies favoring enforce-

ment of arbitration agreements—as well as the inter-

reiated NLRA policies of majority rule and exclusive

representation—as all being secondary in importance

to the EEO laws’ policy of protecting individuals

against discrimination. But their argument poses a

false dichotomy. There is no need to decide in this

case which of these federal policies is the more im-

portant—or to subordinate one statute’s policies to

another’s—because there is no inherent conflict be-

tween them. For the individual rights guaranteed

under the EEO laws can be effectuated just as suc-

cessfully by enforcing agreements to arbitrate as by

allowing individuals direct access to the courts.

As this Court has recognized, an agreement to ar-

bitrate statutory claims does not amount to a waiver

of any of the substantive rights guaranteed to in-

dividuals under the EEO laws. It merely submits

to a different forum for their resolution. Gilmer,

500 U.S. at 26. An arbitrator can enforce substan-

tive statutory rights as effectively as a judge or jury,

and in most cases more quickly and efficiently. This

is equally true whether the agreement to arbitrate

was made directly by the individual, or by a union

on behalf of a group of employees that selected it as

their bargaining agent.“

gress passed on October 30, 1991, and President Bush signed

into law on November 21, 1991. Thus, Gilmer had been the

law of the land for over five months when Congress’ endorsed

arbitration as a means of resolving ADA disputes [where

appropriate and to the extent authorized by law.”

It also is equally true whether the statutory rights in-

volved arise from the Sherman Act, 15 U.S.C. §§ 1-7; Section

10(b) of the Securities and Exchange Act of 1934, 15 U.S.C.

17

Furthermore, even if, contrary to this Court’s ob-

servation in Gilmer, a union’s agreement to substitute

arbitration for courtroom adjudication of statutory

claims could properly be characterized as a waiver

of individuals’ substantive statutory rights, that

would not provide a valid ground for denying en-

forcement of such agreements. For this Court has

held that, when employees select a union to represent

them, they invest the union with power to waive

their statutory rights through the collective bargain-

ing process. See Metropolitan Edison Co. v. NLRB,

460 U.S. 693, 705 (1983). Indeed, in that case the

Court made clear that this authority includes the

power to waive not only statutory rights that are col-

lective in nature, such as the right to strike and the

right to refuse to cross picket lines, but also to waive

protected rights that are individual in nature. Id.

at 706-07.

As this Court recognized in Metropolitan Edison,

federal labor law contains a built-in safeguard

against any danger that a union’s exercise of the

authority to waive the rights of those it represents

might somehow diminish the substantive protection

afforded them by statutes. That protection lies in

the duty of fair representation which the law im-

poses on a union serving as a bargaining agent. Id.

at 706 n.11 (“[T]he National Labor Relations Act

contemplates that individual rights may be waived

by the union so long as the union does not breach its

duty of good-faith representation.”). See also Air

§ 78j (b); the civil provisions of the Racketeer Influenced and

Corrupt Organizations Act (RICO), 18 U.S.C. § 1961 et seq.;

or Section 12(2) of the Securities Act of 1933, 15 U.S.C.

§ 771(2) ; or the federal equal employment opportunity laws.

See Gilmer, 500 U.S. at 26, and cases there cited.

18

Line Pilots Ass’n, Int'l v. O'Neill, 499 U.S. 65

(1991); Vaca v. Sipes, 386 U.S. 171 (1967);

Humphrey v. Moore, 375 U.S. 335 (1964). Thus,

there is no inconsistency between the EEO laws’ goal

of protecting individuals against discrimination in

employment and the labor laws’ policy of allowing a

majority-selected bargaining agent to select the pro-

cedural forum in which disputes over such rights will

be resolved.

B. Federal Policies Favoring Enforcement of Volun-

tary Agreements to Arbitrate Must Prevail Over

Outmoded Suspicion of Arbitration

Petitioner and his amic: argue that this Court’s

decision in Alexander v. Gardner-Denver Co., 415

U.S. 36 (1974), requires reversal of the Fourth Cir-

cuit’s decision in this case. Contrary to their conten-

tions, however, Alexander does not preclude enforce-

ment of a collectively-bargained agreement requiring

submission of statutory discrimination claims to ar-

bitration. Alexander simply does not address that

issue. It merely holds that when an arbitrator has

rendered a decision based on wholly contractual

claims, that decision does not bar a subsequent Title

VII suit to enforce statutory claims. The Court in

Alexander observed that contractual rights and statu-

tory rights “have legally independent origins and are

equally available to the aggrieved employee.” 415

U.S. at 52. It stressed that the arbitrator in that

ease was “confined to the interpretation of the col-

lective bargaining agreement.” Id. at 53.

Thus, Alexander turned on a distinction between

contractual claims, which were covered by the appli-

cable arbitration agreement in that case, and statu-

tory claims, which were not. Id. at 52-53. It did not

19

address situations like the one in this case, in which

an arbitration agreement plainly covers statutory as

well as contractual discrimination claims. As the

Fourth Circuit noted in Austin, this fact alone dis-

tinguishes Alexander, 78 F.3d at 883 n.2.

Furthermore, as this Court expressly recognized

in Gilmer, Alexander’s marked distrust of labor arbi-

tration as an adequate forum for resolving statutory

discrimination claims is out of step with the Court’s

recent holdings. 500 U.S. at 34 n.5. In light of to-

day’s realities, courts simply cannot afford to fore-

close the alternative of arbitration. Since 1974, when

Alexander was decided, cases filed in the federal

courts have increased by over 150 percent.’ Statistics

with respect to employment cases are even more glar-

ing. Between 1969 and 1990, employment claims filed

in federal court increased by over two thousand per-

cent. Federal Courts Study Committee, Report of

the Federal Courts Study Committee 61 (1990).

Since 1990, the number of such claims has tripled.”

To compound matters, increases in the total number

of federal judgeships have not kept pace with court

filings. In 1974, the number of cases filed per district

court judgeship was 358. By 1997, that figure had

risen to 480."

Even these dramatic numbers do not tell the full

story, however. As Chief Justice Warren Burger rec-

Source: Statistics Division, Administrative Office of U.S.

Courts.

10 Source: Statistics Division, Administrative Office of U.S.

Courts.

11 Source: Statistics Division, Administrative Office of U.S.

Courts.

20

ognized some 17 years ago, people's patience with

the judicial system is wearing thin.” Barrentine v.

Arkansas-Best Freight System, Inc., 450 U.S. 728,

752 (1981 ) (dissenting opinion). Thus, as Chief Jus-

tice Burger put it, a holding that limits enforceability

of a voluntary agreement to arbitrate statutory claims

“runs counter to every study and every exhortation

of the Judiciary, the Executive, and the Congress

urging the establishing of reasonable mechanisms to

keep matters of this kind out of the courts.” Id.

Arbitration provides an extrajudicial means by

which disputes that typically arise in the employment

setting can be resolved in a more efficient and less

expensive manner, without further burdening our

overcrowed court system.

The reasons favoring arbitration are as wise as

they are obvious: litigation is costly and time

consuming, and more importantly to the point in

this case, judges are less adapted to the nuances

of the disputes that typically arise in shops and

factories than shop stewards, business agents, and

managerial supervisors .... By bringing to-

gether persons actually involved in the work-

place, often assisted by a neutral arbitrator ex-

perienced in such matters, disputes are resolved

swiftly and cheaply. This mechanism promotes

industrial harmony and avoids strikes and con-

flicts, it provides a swift, fai and inexpensive

remedy.

Id. at 747-48.

“Congress passed the Federal Arbitration Act

to help legitimate arbitration and make it more read-

ily useful to disputants. The hope has long been that

the Act could serve as therapy for the ailment of the

21

crowded docket.” Securities Indus. Ass’n v. Connolly,

883 F.2d 1114, 1116 (Ist Cir. 1989). Viewing the

strong endorsements of arbitration by Congress and

this Court against the ominous backdrop of the cur-

rent, overwhelming federal caseload, such “therapy”

is more appropriate and necessary now than ever.

CONCLUSION

For the reasons discussed above, the amici curiae

respectfully submit that the court of appeals’ decision

dismissing petitioner Wright’s Americans with Dis-

abilities Act lawsuit because of his failure to submit

his claims to arbitration as required by the collective-

bargaining agreement should be affirmed.

Respectfully submitted,

JEFFREY A. BERMAN ROBERT E. WILLIAMS *

SIDLEY & AUSTIN ANN ELIZABETH REESMAN

555 West Fifth Street DANIEL V. YAGER

Los Angeles, CA 90018-1010 McGUINEsS & WILLIAMS

(213) 896-6000 1015 Fifteenth Street, N.W.

Attorney for Amicus Curiae Suite 1200

Employers Group Washington, D.C. 20005

(202) 789-8600

Attorneys for Amici Curiae

Equal Employment

Advisory Council and

Labor Policy Association

* Counsel of Record