Mandatory arbitration: HR expert’s take on Pyett decision

supreme court

AP Photo / Charles Dharapak

HR Roundtable member Bill Pinto gives his take on the U.S. Supreme Court ’s opinion to allow unions to waive
employee’s access to a judicial forum for statutory discrimination claims.

For decades, the U.S. Supreme Court has approved the use of arbitration to resolve employment-related disputes. This position rose to prominence from a trilogy of cases in 1960 involving the steelworkers union and the use of arbitration to settle matters collectively bargained in a union contract. Over the years, the Court has expanded its position to cover mandatory arbitration agreements between employers and their individual employees. Such agreements require employees to use arbitration instead of the courts to resolve their employment claims, including individual statutory discrimination claims.

Earlier this month, the Supreme Court issued an opinion that permits employers and unions to include a provision in a collective bargaining agreement (CBA) that requires employees to use arbitration to resolve their individual statutory discrimination claims provided that the specific statutory claims are listed in the CBA. The case can be found on the Supreme Court’s Web Site. Although the case, 14 Penn Plaza, LLC v. Pyett, involved an age discrimination claim under the federal Age Discrimination in Employment Act (ADEA), the impact of the case applies to other discrimination statutes, including Title VII of the Civil Rights Act of 1964 (Title VII) which protects employees from discrimination based on sex, race, color, national origin, and religion.

In effect, the Pyett decision permits employers and unions to bargain away an individual employee’s choice of forum for statutory discrimination claims. Many do not have an issue when unions bargain on behalf of a group of employees on matters such as wages, vacation time, health insurance benefits, or retirement contributions. However, when it comes to an employee’s right to bring a discrimination claim, many think that a union should not be permitted to bargain away someone’s individual right in such a way. In fact, many do not think that an individual should be allowed to agree to waive his or her right to bring a discrimination claim in court as occurs with the mandatory arbitration agreements that many employers use with their employees. So, for the Court to expand its approval in this way is alarming to some. Others see this as a logical extension of the Court’s prior decisions on the subject of arbitration.

There are many articles regarding the pros and cons of arbitration over a judicial forum, which we may address on another day. But what the Pyett decision tells us is that the Court, at least as currently constituted, is committed to its historical approval of arbitration as a valid means of resolving employment disputes, including disputes based on statutory discrimination claims.

Do you think unions should be permitted to bargain about the arbitration of individual statutory discrimination claims? Would you trust a union to defend your interests in the arbitration of a discrimination claim? If you have had experience arbitrating a workplace claim, what was your experience like and would you be comfortable bringing a discrimination claim in that forum?

Comments are closed.