Amicus Curiae Brief — Circuit City Stores, Inc. v. Adams

Supreme Court, U.S.

FILED

Y AUC ~ 4 9000

No. =

IN THE

Supreme Court of the United States

CIRCUIT CITY STORES, INC.,

Petitioner,

v.

SAINT CLAIR ADAMS,

Respondent.

On WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

—eeooEoooooooooooooooooyyyyyyyyyyy—ESESESESS—SSSSSS==____a[[an===S=S=_

BRIEF OF AMICUS CURIAE

SOCIETY FOR HUMAN RESOURCE MANAGEMENT

IN SUPPORT OF PETITIONER

Davip E. BLock

Counsel of Record

CHRISTINE L. WILSON

JACKSON, Lewis, SCHNITZLER & KRUPMAN

Attorneys for Amicus

First Union Financial Center, Suite 2600

200 South Biscayne Boulevard

Miami, Florida 33131-2374

(305) 577-7600

161382 @ Counsel Press LLC

(800) 274-3321 + (800) 359-6859

TABLE OF CONTENTS

Table of Cited Authorities ....................

Interest of Amicus Curiae .....................

I ES oo ccc ecuneetevevescoeds

PED 6 66.444 Oho 6cR ences dncdebecdcceecess

I.

II.

III.

The Court Of Appeals’ Ruling is Inconsistent

with Congressional Intent and This Court’s

Advocation of a “Federal Policy Favoring

DE, <ctidcedcecbenedcheiens e¥e

A. Subsequent Legislation by Congress

Presumes That Employment Disputes

are Arbitrable Under the FAA. .......

This Court’s Decisions with Respect to

Workplace Disputes Favor Internal

Employment Policies Designed to Prevent

and Redress Problems Without Resorting to

Judicial Intervention. ..........ccccecees

A. The Explosion of Workplace Litigation

has Placed an Overwhelming Burden on

PP Chad Nhs Ged WkeReAS esse

If the Agreement at Issue is Deemed a Contract

of Employment, the Court’s Decision Will

Jeopardize Other Longstanding Human

Resource Policies and Practices. .........

I Si see Bee te aR aa on

Appendix — Statutes and Regulations Involved ..

ii

TABLE OF CITED AUTHORITIES

CASES:

U.S. Supreme Court

Amoco Prod. Co. v. Village of Gambell, 480 U.S.

$31 (1987) ....cccccesesceeseuueuneee

Burlington Indus., Inc. v. Ellerth, 524 U.S. 742

CIDDE) 0. cc vccecscesesssusu uu eee

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

(19BS) . ws ccnccvecceccces pune een

Dickerson v. United States, 120 S. Ct. 2326 (2000)

FDIC v. Meyer, 510 U.S. 471 (1994) ............

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

20 (1991) ..cccccccccesvsnne enue enna

Goodyear Atomic Corp. v. Miller, 486 U.S. 174

(19GB) occ cccvcccccesseeeu umn e aE

Kolstad v. American Dental Ass'n, 527 U.S. 526

(1DDD) . wc cccccccsecececeue ssn

Miles v. Apex Marine Corp., 498 U.S. 19 (1990) ..

Page

12

10

11

5

Cited Authorities

Page

Mitchell v. United States, 526 U.S. 314 (1999) ... 1]

Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth,

Er 4

Moses H. Cone Mem'l Hosp. v. Mercury Constr.

TT CUED occcccccccccecccees 4

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

on ie osc seeeksen sees 4

Textile Workers Union v. Lincoln Mills, 353 U.S.

ee eee es cases eet edeoceeses 8, 11

U.S. Courts of Appeals and District Courts

Asplundh Tree Expert Co. v. Bates, 71 F.3d 592

EEE 3

Austin v. Owens-Brockway Glass Container, Inc.,

78 F.3d 875 kc accu usees 5

Circuit City v. Adams, 194 F.3d 1070 (9" Cir. 1999),

cert. granted, 120 S. Ct. 2004 (2000) ......... 13,14

Cole v. Burns Int'l Sec. Servs., 105 F.3d 1465 (D.C.

reer ek ches eneeeéonscoeees 3

Dickstein v. DuPont & Co., 443 F.2d 783 (1* Cir.

ES SSIES OPT PETE E PP ETET ES 3

iv

Cited Authorities

EEOC v. Frank's Nursery & Crafts, 966 F. Supp.

500 (E.D. Mich. 1997) .........222 eee eeee

Hasham v. California State Bd. of Equalization, 200

P.36 1035 (7 Cie. 20GG) . nc cccccccccccccss

Hutson v. McDonnell Douglas Corp., 63 F.3d 771

GP Glo. BGT cccccccccccescccccccsesesese

Koveleskie v. SBC Capital Mkts., Inc., 167 F.3d 361

‘tet 3 .. SPPPPPPTTTETITELIS TTT TTT Te

Matthews v. Rollins Hudig Hall Co., 72 F.3d 50

CP Ge. BGT cc ccvcccesccccoccesesecceces

McWilliams v. Logicon, Inc., 143 F.3d 573 (10" Cir.

SEED cccccccadcdecceuceeseccacensoenessss

Miller Brewing Co. v. Brewery Workers Local Union

No. 9, 739 F.2d 1159 (7® Cir. 1984), cert. denied,

SED UB. TIGD (IGE) occcccccccccccccsccces

Miller v. Public Storage Management, 121 F.3d 215

BPG, TSGD es ccccccseccccsesceccesceces

Modzelewski v. Resolution Trust Corp., 14 F.3d 1374

ae S| PPP PPrrrrrrrrrrrrrrrrT rr rrr ry

Page

Vv

Cited Authorities

Page

Patterson v. Tenent Healthcare, Inc., 113 F.3d 832

ge Per ee 3

Seus v. Nuveen & Co., 146 F.3d 175 (3d Cir. 1998),

cert. denied, 525 U.S. 1139 (1999) ........... 3,5

State Courts

Asmus v. Pacific Bell, 999 P.2d 71 (Cal. 2000) ... 12

STATUTES, REGULATIONS AND RULES:

The Federal Arbitration Act

9 U.S.C.A. §§ 1-14 (West 1999) ............... 1

Labor Relations Management Act

29 U.S.C.A. § 185(a) (West 1998) .............. 8

Civil Rights Act of 1964, as amended

42 U.S.C.A. § 2000¢e et seg. (West 1994) ........ 5

42 U.S.C.A. § 2000e-5(b) (West 1994) .......... 7

Americans With Disabilities Act

42 U.S.C.A. §§ 12101-12213 (West 1994) ....... 7

42 U.S.C.A. § 12212 (West 1994) .............. 7

Civil Rights Act of 1991

42 U.S.C.A. § 1981 (West 1994), Pub. L. No. 102-

BGG, © SOG, SGU BOM. BOTS nc cccccccccccccces 6

vi

Cited Authorities

BPG OE OPENS cccccccccsccceccees

Supreme Court Rule 37.3(a) .............02005:

Supreme Court Rule 37.6 ...........ccceeeeees

LEGISLATIVE MATERIALS:

rh eo on . cccese¢ensedeeua'ed

H.R. Rep. No. 102-40(II) (1991), reprinted in 1991

EE i duced andeecenusshetese’

hE <.cecceceeuseedacoast

1910 Cones. Rac. $7242 (19GS4) .. cc cccccccccces

110 Cone. Rec. $11848 (1964) ................

137 Conc. Rec. $15472 (1991) ................

TREATISES, ARTICLES AND

OTHER PUBLICATIONS:

Biack’s Law Dictionary 525 (6" ed. 1990) ......

Employers Wage War of Workplace Lawsuits;

Survey Reveals Trend Toward Prevention,

PR Newswire Ass’n, Inc. (Nov. 11, 1998) .....

vii

Cited Authorities

Employment Bias Cases in Federal Court Almost

Tripled in Previous Decade, Daily Lab. Rep.

SPE, SERED cesctecndcocccecesees 8

U.S. Equal Employment Opportunity Comm’n,

Charge Statistics FY 1992 through FY 1999

(visited July 18, 2000) <http://www.eeoc.gov/

SE scancteadcccedendeeccedaccussuedeces 8

|

INTEREST OF AMICUS CURIAE

The Society for Human Resource Management (“SHRM”)

submits this brief in support of Petitioner Circuit City.'! SHRM

is the largest human resource association in the world with over

140,000 professional members from all 50 states and 80 other

countries; SHRM is the leading voice of the human resource

profession. SHRM’s mission is to lead, represent, guide, and

inform human resource practitioners and others interested in

human resource issues regarding matters of critical and strategic

importance to the workplace.

SHRM members, probably more than any other association

of professionals, will be responsible for designing and

implementing arbitration programs, policies, and procedures

that comport with the Court’s decision.

SHRM welcomes the opportunity to file this brief to assist

the Court’s understanding of the enormous practical effect its

decision will have in the workplace.

SUMMARY OF ARGUMENT

The decision of the United States Court of Appeals for the

Ninth Circuit should be reversed. The Federal Arbitration Act,

9 U.S.C.A. §§ 1-14 (West 1999) (“FAA”), proclaims a liberal

federal policy favoring arbitration of disputes. Section | of the

FAA, however, excludes from its purview “contracts of

employment of seamen, railroad employees, or any other class

1. Pursuant to Supreme Court Rule 37.3(a), amicus files this

brief with the consent of the parties. Evidence of consent is filed

concurrently with this brief. Amicus discloses pursuant to Supreme

Court Rule 37.6 that no counsel for a party authored any part of this

brief, nor did any person or entity other than amicus curiae, its

members, or its counsel make a monetary contribution to the

preparation or submission of this brief.

2

of worker engaged in foreign or interstate commerce.” Every

circuit court, other than the Ninth Circuit, has come to the

conclusion that Section 1’s exclusions were intended to apply

only to a limited class of contracts: i.e., contracts of those

employees actually engaged in the movement of goods across

state lines. SHRM urges this Court to follow the decisions of

the majority of circuit courts.

Consistent with the intent and purpose of the FAA and

subsequent legislation by Congress, agreements to arbitrate in

the employment c sntext are enforceable under the FAA. Further,

empowering employees and employers to work together to

prevent and resolve workplace disputes without judicial

intervention has been the policy of Congress and this Court for

the last seventy-five years. The Ninth Circuit’s decision deviates

from this long line of precedent and, therefore, should be

overturned.

SHRM urges this Court to follow the recent, practical

decisions endorsing and encouraging arbitration that it has

developed over the past two decades. As set forth below, to

affirm the Ninth Circuit would call into question the validity of

the employment practices and policies developed and relied

upon for decades.

Finally, the agreement to arbitrate at issue is set forth in a

job application which the Ninth Circuit concluded, a fortiori,

was a contract of employment. SHRM and its members are

concerned that if a job application is considered an employment

contract then other documents and agreements ancillary to the

employment relationship also will be considered contracts of

employment. If so, under the Ninth Circuit’s reasoning,

arbitration of these ancillary issues (which are longstanding

practices in some instances) are unenforceable under the FAA.

From a human resources perspective, sustaining the Ninth

3

Circuit’s decision will change the landscape of how SHRM

and its members apply these policies. SHRM believes this was

neither the intent of Congress nor is it consistent with this

Court’s decisions encouraging arbitration.

ARGUMENT

I.

THE COURT OF APPEALS’ RULING IS

INCONSISTENT WITH CONGRESSIONAL INTENT

AND THIS COURT’S ADVOCATION OF A

“FEDERAL POLICY FAVORING ARBITRATION.”

The Ninth Circuit’s refusal to compel arbitration under the

FAA contravenes Congressional intent favoring arbitration of

employment disputes. It also is at odds with every other circuit

court to consider this issue.’

2. SHRM anticipates that the central issue as to the meaning,

intent, and purpose of Section | of the FAA and, in particular, its

exclusion of certain types of contracts will be briefed and argued

by the parties. Accordingly, SHRM does not address this issue, but

urges the Court follow the circuit court decisions holding that Section

1’s exclusions were intended to apply only to a limited class of

contracts: i.e., contracts of those employees actually engaged in the

movement of goods across state lines. See, e.g., Koveleskie v. SBC

Capital Mkts., Inc., 167 F.3d 361, 363-64 (7th Cir. 1999); Seus v.

Nuveen & Co., 146 F.3d 175, 178-79 (3rd Cir. 1998), cert. denied,

525 U.S. 1139 (1999); McWilliams v. Logicon, Inc., 143 F.3d 573,

575-76 (10th Cir. 1998); Patterson v. Tenent Healthcare, Inc., 113

F.3d 832, 835-37 (8th Cir. 1997); Cole v. Burns Int'l Sec. Servs.,

105 F.3d 1465, 1470-71 (D.C. Cir. 1997); Miller v. Public Storage

Mgt., 121 F.3d 215, 217-18 (Sth Cir. 1997); Asplundh Tree Expert

Co. v. Bates, 71 F.3d 592, 596-601 (6th Cir. 1995); Miller Brewing

Co. v. Brewery i/crkers Local Union No. 9, 739 F.2d 1159, 1162

(7th Cir. 1984), cert. denied, 469 U.S. 1160 (1985); Dickstein v.

DuPont & Co., 443 F.2d 783, 785 (1st Cir. 1971).

4

The purpose of the FAA “was to reverse the longstanding

judicial hostility to arbitration agreements ... and to place

arbitration agreements upon the same footing as other contracts.”

Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 24 (1991)

(citations omitted). The FAA’s legislative history demonstrates

that the drafters intended to broaden the use of arbitration and

protect agreements to arbitrate from the courts’ “jealousy” for

their own jurisdiction. See H.R. Rep. No. 68-96, at 1-2 (1924)

(the courts “refused to enforce specific agreements to arbitrate

upon the ground that the courts were thereby ousted from their

jurisdiction’”’); S. Rep. No. 68-536, at 2-3 (1924) (“the jealously

of their rights as courts, coupled with the fear that if arbitration

agreements were to prevail and be enforced, the courts would

be ousted of much of their jurisdiction”).

In the seventy-five years since the FAA’s enactment, its

goal of eliminating judicial hostility towards arbitration has been

achieved.’ This Court, moreover, has encouraged “a federal

policy favoring arbitration,” Shearson/American Express, Inc.

v. McMahon, 482 U.S. 220, 226 (1987) (quoting Moses H. Cone

Mem. Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983)),

and has held that courts must “rigorously enforce agreements

to arbitrate” under the FAA. See Dean Witter Reynolds Inc. v.

Byrd, 470 U.S. 213, 221 (1985).

3. See, e.g., Shearson/American Express, Inc. v. McMahon,

482 U.S. 220, 231-32 (1987) (the “mistrust of the arbitral process”

has been undermined by recent arbitration decisions); Mitsubishi

Motors Corp. v. Soler Chrysler-Plymouth, 473 U.S. 614, 626-627

(1985) (“[w]e are well past the time when judicial suspicion of the

desirability of arbitration and of the competence of arbitral tribunals

inhibited the development of arbitration as an alternative means of

dispute resolution”).

5

A. Subsequent Legislation by Congress Presumes That

Employment Disputes Are Arbitrable Under the FAA.

The Ninth Circuit’s decision holds that even voluntary

agreements to arbitrate between an employer and employee

(presumably including agreements to arbitrate after a dispute

arises) are unenforceable under the FAA. This holding patently

is at odds with congressional intent permitting voluntary

arbitration of civil rights claims.

Congress, in enacting legislation, is presumed to be aware

of existing legislation. See Miles v. Apex Marine Corp., 498

U.S. 19, 26 (1990); Goodyear Atomic Corp. v. Miller, 486 U.S.

174, 184-85 (1988). The enactment of employment

discrimination statutes after passing the FAA indicates

congressional intent to permit arbitration under these laws to

be enforced pursuant to the FAA.

The amendment of Title VII of the Civil Rights Act of

1964, 42 U.S.C.A. §§ 2000e-2000e-17 (West 1994) (“Title

VII"), by the Civil Rights Act of 1991 (“CRA 1991”),

demonstrates the acceptance and encouragement of extra-

judicial resolution, and, specifically, arbitration.‘ Section 118

of the CRA 1991 states, “[w]here appropriate and to the extent

4. A number of lower courts have compelled arbitration, in

part, on this basis. See, e.g., Seus v. John Nuveen, 146 F.3d at 182

(affirming decision compelling arbitration stating “the text of § 118

evinces a clear Congressional intent to encourage arbitration of Title

VII and ADEA claims, not to preclude such arbitration”); Austin v.

Owens-Brockway Glass Container, Inc., 78 F.3d 875, 881-82

(4th Cir. 1996) (the 1991 CRA and ADA “encourage[] arbitration”);

Matthews v. Rollins Hudig Hall Co., 72 F.3d 50, 53 n.4 (7th Cir.

1995) (the CRA of 1991 “encouraged the use of arbitration to resolve

ADEA claims”); EEOC v. Frank's Nursery & Crafts, 966 F. Supp.

500, 503 (E.D. Mich. 1997) (Congress has “evinced a specific intent

to encourage arbitration of Title VII claims”).

6

authorized by law, the use of alternative means of dispute

resolution including, . . . arbitration, is encouraged to resolve

disputes arising under the Acts or provisions of Federal law

amended by this title.” Pub. L. No. 102-166, § 118, 105 Stat.

1071 (set forth in the notes following 42 U.S.C.A. § 1981 (West

1994)). Further, the legislative history states that:

This section “encourages” the voluntary use of

conciliation, mediation, arbitration and other

methods for resolving disputes under Civil Rights

laws governing employment discrimination.

We agree that voluntary mediation and arbitration

are far preferable to prolonged litigation for

resolving employment discrimination claims.

We recognize that mediation and arbitration,

knowingly and voluntarily undertaken, are the

preferred methods of settlement of employment

discrimination disputes.

H.R. Rep. No. 102-40(II), at 78 (1991), reprinted in 1991

U.S.C.C.A.N. 694, 764. Similarly, it was stated at the Senate

hearings that “where the parties knowingly and voluntarily elect

to use these methods,” arbitration would be encouraged. 137

Conc. Rec. $15472, $15478 (statement of Sen. Dole) (1991).

Title VII's legislative history, moreover, indicates that the

Equal Employment Opportunity Commission (“EEOC”) was

created to mediate claims and, thus, forego the need to resort to

the courts. See 110 Conca. Rec. $11848 (1964) (statement of

Sen. Humphrey) (the EEOC would be created “to investigate

complaints and to bring about voluntary settlement’); 110 Conc.

Rec. $7242 (1964) (statement of Sen. Case) (“much may be

7

accomplished in achieving fair employment opportunities

through the wise and imaginative exercise of persuasion,

mediation, and conciliation”). A ruling that does not uphold

arbitration may dampen the trend by the EEOC, employers,

and lower courts for finding alternative dispute resolution, such

as mediation, conciliation, and arbitration as alternatives to

court.

The regulations governing Title VII further demonstrate

the reliance on settling cases through extra-judicial methods.

See 29 C.F.R. § 1601.20 (1999) (encouraging settlement prior

to issuing a determination). Even when the EEOC finds

reasonable cause to believe a violation of the anti-discrimination

laws has occurred, Title VII expressly requires it to “endeavor

to eliminate any such alleged unlawful employment practice

by informal methods of conference, conciliation, and

persuasion.” 42 U.S.C.A. § 2000e-5(b) (West 1994).

The Americans with Disabilities Act of 1990,

42 U.S.C.A. §§ 12101-12213 (West 1994) (“ADA”), also

specifically encourages parties to use extra-judicial methods of

resolving disputes: “Where appropriate and to the extent

authorized by law, the use of alternative means of dispute

resolution, including . . . arbitration, is encouraged to resolve

disputes arising under this chapter.” Jd. § 12212.

It is clear that under Title VII and the ADA parties may

voluntarily agree to arbitrate.© Assume an employer and

employee agree, after a dispute arises, to resolve the matter

through arbitration. After three days of arbitration can one party

“pull out,” believing the arbitration is going poorly, to try anew

5. In Gilmer, this Court found that claims under the

Age Discrimination in Employment Act also were arbitrable.

See 500 U.S. 20.

8

before a judge or jury? If not, under what law will arbitration

be compelled? Title VII and the ADA do not confer specific

jurisdiction on the federal courts to enforce agreements to

arbitrate.° Thus, Congress understood and presumed that

another vehicle existed to compel arbitration: i.e., the FAA.

THIS COURT’S DECISIONS WITH RESPECT TO

WORKPLACE DISPUTES FAVOR INTERNAL

EMPLOYMENT POLICIES DESIGNED TO PREVENT

AND REDRESS PROBLEMS WITHOUT RESORTING

TO JUDICIAL INTERVENTION.

A. The Explosion of Workplace Litigation Has Placed an

Overwhelming Burden on the Courts.

In the past decade, the number of employment

discrimination cases filed in federal court has nearly tripled.

See Employment Bias Cases in Federal Court Almost Tripled

in Previous Decade, Daily Labor Rep. (BNA) A-1l

(Jan. 20, 2000) (the number of employment cases filed in federal

courts between 1990 and 1998 jumped from 8,413 to 23,735);

see also U.S. Equal Employment Opportunity Comm’n, Charge

Statistics FY 1992 through FY 1999 (visited July 18, 2000)

<http://www.eeoc.gov/stats/> (77,444 discrimination charges

were filed with the EEOC in 1999).

6. In contrast, Congress conferred specific jurisdiction for the

federal courts to enforce contracts between an employer and a labor

organization representing employees, including jurisdiction to

enforce arbitration provisions contained in collective bargaining

agreements. See Labor Relations Management Act § 301,

29 U.S.C.A. § 185(a) (West 1998); Textile Workers Union v. Lincoln

Mills, 353 U.S. 448, 456 (1957) (holding that Section 301(a) of the

LMRA authorizes federal courts to enforce agreements to arbitrate).

9

It is ‘probable that the threefold increase in filings of

employment discrimination claims has been caused by a

threefold increase in discriminatory conduct by employers over

the past eight to ten years. To the contrary, empirical evidence

suggests that in today’s tight labor market, employers are doing

everything possible to attract and retain workers, including the

creation of human resource procedures designed to encourage

fairness in the workplace. See Employers Wage War of

Workplace Lawsuits; Survey Reveals Trend Toward Prevention,

PR Newswire Ass’n, Inc. (Nov. 11, 1998) (86% of U.S.

Companies have created written human resource policy

manuals; 63% have implemented training programs for

managers and supervisors; 57% have developed employee

grievance policies; 51% have hired human resource managers

and 48% have purchased employment practices liability

insurance).

The increase in federal filings reflects a growing demand

by employees to have a neutral party review their employers’

decisions. Employers, in turn, want to provide employees with

fair alternatives to redress workplace problems, without

resorting to the courts. Arbitration achieves this end.

The deluge of employment litigation has caused some on

the federal bench to note that their purpose is not to serve as

“super personnel departments.” Hasham v. Califoraia State Bd.

of Equalization, 200 F.3d 1035, 1048 (7* Cir. 2000) (“this Court

has consistently avoided stepping into the role of a super-

personnel department”); Hutson v. McDonnell Douglas Corp.,

63 F.3d 771, 781 (8" Cir. 1995) (“this case appears to be

precisely the typc of employment dispute that this Court has

repeatedly stated is not covered by the discrimination laws. . . .

[T]he employment-discrimination laws have not vested in the

federal courts the authority to sit as super-personnel

10

departments”). To quell the clamor for judicial intervention into

workplace disputes and to provide employers with an incentive

to better manage their workplace, this Court has articulated that

the law favors the institution of fair and reasonable preventative

policies and procedures.

For example, in Kolstad v. American Dental Ass'n, this

Court ruled that an employer that trains its work force regarding

discrimination may avoid liability for punitive damages.

See 527 U.S. 526, 545 (1999). Specifically, with regard to

punitive damages, the Court stated, “an employer may not be

vicariously liable for the discriminatory employment decisions

of managerial agents where these decisions are contrary to the

employer’s ‘good-faith efforts to comply with Title VII.’ ” /d.

(citation omitted).

The Court also effectively has encouraged employers to

create internal grievance procedures to redress issues of sexual

harassment. See Faragher v. City of Boca Raton, 524 U.S. 775,

808 (1998) (“It would . . . implement clear statutory policy and

complement the Government’s Title VII enforcement efforts

to recognize the employer’s affirmative obligation to prevent

violations [of Title VII] and give credit here to employers

who make reasonable efforts to discharge their duty”);

see also Burlington Indus., Inc. v. Ellerth, 524 U.S. 742, 765

(1998) (a defending employer may raise an affirmative defense

by showing that it “exercised reasonable care to prevent and

correct promptly any sexually harassing behavior, and . . . that

the plaintiff employee unreasonably failed to take advantage of

any preventive or corrective opportunities provided by the

employer to avoid harm otherwise”).

The establishment of alternative dispute resolution

programs, including arbitration, works in conjunction with these

decisions to further encourage and reward employers and, in

11

particular, direct their human resource departments to take steps

to correct workplace discrimination without judicial

intervention. The logical extension of these decisions, coupled

with the Court’s decades-long encouragement of arbitration, is

to recognize arbitration as a viable and fair means of resolving

workplace grievances.’ A contrary conclusion will unravel well-

established arbitration programs, as well as other employment

policies and procedures.* SHRM, therefore, urges the Court to

reverse the Ninth Circuit.

7. More than 40 years ago, this Court ruled that an agreement

to arbitrate grievances was quid pro quo for an agreement by a labor

organization (and its members) not to strike. See Lincoln Mills, 353

U.S. at 455. Since this ruling, “wild cat” strikes virtually have

disappeared, arguably giving the United States greater labor peace

than any other nation. In contrast, the United States has more

employment-based (non-union) litigation than any other country.

What has worked so well in one area of employment relations (those

with unions and employers) can work equally well if arbitration

between employers and non-union employees is permitted.

8. The Supreme Court has, in other areas of the law, considered

whether wide-spread acceptance to a practice is reason to sustain

the practice. See, e.g., Dickerson v. United States, 120 S. Ct. 2326

(2000) (“We do not think there is such justification for overruling

Miranda. Miranda has become embedded in routine police practice

to the point where the warnings have become part of our national

culture”); Mitchell v. United States, 526 U.S. 314, 331-32 (1999)

(Scalia, J., dissenting) (noting that the fact that a rule has found

“*wide acceptance in the legal culture’” is “adequate reason not to

overrule” it).

12

Ill.

IF THE AGREEMENT AT ISSUE IS DEEMED A CON-

TRACT OF EMPLOYMENT, THE COURT’S DECI-

SION WILL JEOPARDIZE OTHER LONGSTANDING

HUMAN RESOURCE POLICIES AND PRACTICES.

The FAA does not define the phrase “contract of

employment.”” Nor does the FAA’s legislative history shed

clear light on the meaning of this phrase. As a general matter of

statutory construction, absent a definition, a word or phrase in

a statute is given its plain and ordinary meaning. See, e.g., FDIC

v. Meyer, 510 U.S. 471, 476 (1994) (stating that the term

“cognizable” was not defined under the Federal Tort Claims

Act and therefore the ordinary meaning of the term shall be

construed); Amoco Prod. Co. v. Village of Gambell, 480 U.S.

531, 552-53 (1987) (determining that the statutory language at

issue was plain and nothing in the statute contradicted this plain

meaning).

The plain and ordinary meaning of a “contract of

employment” is one where one party agrees to employ the other

and the other party agrees to such employment.'® Respondent

completed an employment application containing a provision

9. SHRM understands that the Court did not grant certiorari

on the issue of whether a coniract of employment exists, however,

amicus believes there are serious issues which may impact on the

field of human resources should the Ninth Circuit’s ruling be

affirmed.

10. Even in an employment contract that is terminable at will,

one party agrees to employ the other (albeit for an indefinite period)

and the employee agrees to being employed. See, e.g., Asmus v.

Pacific Bell, 999 P.2d 71, 80 (Cal. 2000) (a “ ‘specified condition’

may be one for either definite or indefinite duration”).

13

entitled “Circuit City Dispute Resolution Agreement” (“DRA”).

See Circuit City v. Adams, 194 F.3d 1070, 1071 (9" Cir. 1999),

cert. granted, 120 S. Ct. 2004 (2000). The DRA specifically

states: “I understand that neither this Agreement nor the Dispute

Resolution Rules and Procedures form a contract of employment

between Circuit City and me. .. . [and] this Agreement in no

way alters the ‘at-will’ status of my employment.” /d. at 1071.

While the parties validly agreed to arbitrate future disputes

between them in the employment application, Adams did not

agree nor was he bound to work for Circuit City. Likewise,

Circuit City did not agree to hire Adams. Absent either party

agreeing to work for the other, the document in question cannot

be considered a “contract of employment”; no employment

relationship was established by the job application.

The Ninth Circuit opined that the plain and ordinary

meaning of the phrase “contract of employment” could be found

by looking to its own precedent, which cited BLack’s Law

DicTIONARY’s definition of an employment contract. See Adams,

194 F.3d at 1071 (citing Modzelewski v. Resolution Trust Corp.,

14 F.3d 1374, 1376 (9" Cir. 1994) (quoting BLack’s Law

Dictionary 525 (6" ed. 1990)). The full citation, which the Ninth

Circuit did not provide, reads: “An agreement or contract

between employer and employee in which the terms and

conditions of one’s employment are provided.” BLack’s Law

DicTIONARY 525 (6" ed. 1990).

The circuit court, however, failed to state how the facts of

this case apply to the above definition where the job application

containing the agreement to arbitrate was devoid of any of the

essential terms and conditions of employment. The employment

application containing the agreement to arbitrate fails to

evidence an agreement even to the most rudimentary terms and

conditions of employment: i.e., the employee’s rate of pay or

position.

14

Thus, applying the “dictionary” meaning to the phrase

“contract of employment,” the job application at issue simply

is not an employment contract because it fails to set forth crucial

terms and conditions of employment.

Employers and employees (or job applicants) routinely

enter into valid agreements which are not contracts of

employment: e.g., agreements to adhere to work safety rules,

to comply with certain human resource policies and procedures,

to submit to pre-employment and post-accident drug and alcohol

tests; to keep certain business information confidential; and to

restrict the employee’s post-employment conduct. Many of

these agreements contain provisions permitting arbitration of

disputes which arise in these limited areas. The Ninth Circuit’s

decision suggests that any type of agreement between an

employee and_an employer, a fortiori, is a contract of

employment. SHRM disagrees. The Ninth Circuit’s holding in

Adams calls into doubt whether any of these ancillary

employment issues could be subject to arbitration, thus requiring

employers to re-evaluate virtually all of their employment

policies.

15

CONCLUSION

For the foregoing reasons, amicus curiae Society for Human

Resource Management respectfully requests this Court to

reverse the decision of the U.S. Court of Appeals for the Ninth

Circuit.

Respectfully submitted,

Davip E. Block

Counsel of Record

CHRISTINE L. WILSON

JACKSON, Lewis, SCHNITZLER

& KRUPMAN

Attorneys for Amicus

First Union Financial Center,

Suite 2600

200 South Biscayne Boulevard

Miami, Florida 33131-2374

(305) 577-7600

APPENDIX

x

5 .

~ 7 <e Fs:

Lx Ree sy

> *

*

#h

x

7

‘

«

fat

——_

~ a

A lak a a i ode as case ens See 3 REPRE ie ays VT oan Rae ta Reiley

Rene ea aE Ms eR ato ae any. eee ser. OEMS. Te athe SEY S 4 Ce Re

SY a eB cre ek he eee TEN, SEE Se SGN ies ke

la

APPENDIX — STATUTES AND

REGULATIONS INVOLVED

29 U.S.C. § 185

Suits for violation of contracts between an

employer and a labor organization representing

employees in an industry affecting commerce s

defined in this chapter, or between any such labor

organizations, may be brought in any district court

of the United States having jurisdiction of the

parties, without respect to the amount in

controversy or without regard to the citizenship

of the parties.

42 U.S.C. § 2000e-5(b)

(b) Charges by persons aggrieved or member of

Commission of unlawful employment practices

by employers, etc.; filing; allegations; notice to

respondent; contents of notice; investigation by

Commiss'on; contents of charges; prohibition on

disclosure of charges; determination of reasonable

cause; conference, conciliation, and persuasion

for elimination of unlawful practices; prohibition

on disclosure of informal endeavors to end

unlawful practices; use of evidence in subsequent

proceedings; penalties for disclosure of

information; time for determination of reasonable

cause Whenever a charge is filed by or on behalf

of a person claiming to be aggrieved, or by

a member of the Commission, alleging that

an employer, employment agency, labor

organization, or joint labor-management

fa, DAS ay ak gt a bey

fe ee part a tans FOP a eRe Ps

‘ . mY vi tna fey aya

eo es ante

2a

Appendix

committee controlling apprenticeship or other

training or retraining, including on-the-job

training programs, has engaged in an unlawful

employment practice, the Commission shall serve

a notice of the charge (including the date, place

and circumstances of the alleged unlawful

employment practice) on such employer,

employment agency, labor organization, or joint

labor-management committee (hereinafter

referred to as the ‘’respondent’’) within ten days,

and shall make an investigation thereof. Charges

shall be in writing under oath or affirmation and

shall contain such information and be in such form

as the Commission requires. Charges shall not be

made public by the Commission. If the

Commission determines after such investigation

that there is not reasonable cause to believe that

the charge is true, it shall dismiss the charge and

promptly notify the person claiming to be

aggrieved and the respondent of its action. In

determining whether reasonable cause exists, the

Commission shall accord substantial weight to

final findings and orders made by State or local

authorities in proceedings commenced under State

or local law pursuant to the requirements of

subsections (c) and (d) of this section. If the

Commission determines after such investigation

that there is reasonable cause to believe that the

charge is true, the Commission shall endeavor to

eliminate any such alleged unlawful employment

practice by informal methods of conference,

conciliation, and persuasion. Nothing said or done

3a

Appendix

during and as a part of such informal endeavors

may be made public by the Commission, its

officers or employees, or used as evidence in a

subsequent proceeding without the written

consent of the persons concerned. Any person

who makes public information in violation of this

subsection shall be fined not more than $1,000 or

imprisoned for not more than one year, or both.

The Commission shall make its determination on

reasonable cause as promptly as possible and, so

far as practicable, not later than one hundred and

twenty days from the filing of the charge or, where

applicable under subsection (c) or (d) of this

section, from the date upon which the

Commission is authorized to take action with

respect to the charge.

42 U.S.C. § 12212

Where appropriate and to the extent

authorized by law, the use of alternative means

of dispute resolution, including settlement

negotiations, conciliation, facilitation, mediation,

factfinding, minitrials, and arbitration, is

encouraged to resolve disputes arising under this

chapter.

4a

Appendix

29 C.F.R. § 1601.20(a)

Prior to the issuance of a determination as to

reasonable cause the Commission may encourage

the parties to settle the charge on terms that are

mutualiy agreeable. District Directors, Area

Directors, Local Directors, the Program Director,

Office of Program Operations, Director of

Systemic Programs, Office of Program

Operations, or Directors, Field Management

Programs, Office of Program Operations, or their

designees, shall have the authority to sign any

settlement agreement which is agreeable to both

parties. When the Commission agrees in any

negotiated settlement not to process that charge

further, the Commission’s agreement shall be in

consideration for the promises made by the other

parties to the agreement. Such an agreement shall

not affect the processing of any other charge,

including, but not limited to, a Commission

charge or a charge, the allegations of which are

like or related to the individual allegations settled.