Supreme Court to Decide Enforceability of Union Agreement to Waive Employees' Court Access

Posted: February 25, 2008

The United States Supreme Court has agreed to decide whether a collective bargaining agreement's arbitration provision waiving employees' rights to file a lawsuit for a statutory employment discrimination claim is enforceable. 14 Penn Plaza LLC v. Pyett, No. 07-581 (cert. granted, Feb. 19, 2008). The decision under review comes from the federal Court of Appeals for the Second Circuit, which has jurisdiction over Connecticut, New York, and Vermont. This case likely will be decided during the Court's next term, which begins in the fall.

The plaintiffs claimed they were transferred from their night watchmen positions in a New York skyscraper because of age discrimination in violation of the federal Age Discrimination in Employment Act. The plaintiffs were members of the Service Employees International Union, Local 32BJ, and were covered by a collective bargaining agreement with Realty Advisory Board on Labor Relations, a multi-employer bargaining association. Citing a number of federal and state laws, including the ADEA, a provision in the agreement stated, "All such claims shall be subject to the grievance and arbitration procedure [in the agreement] as the sole and exclusive remedy for violations." After SEIU declined to pursue the plaintiffs' age discrimination claims, they sued the employer and the skyscraper's operators in federal district court. The defendants, citing the arbitration provision in the collective bargaining agreement, demanded that the court direct arbitration or dismiss the claims. The district court refused. The defendants appealed.

The appeals court also refused to compel arbitration of the ADEA claim. It stated broadly, in accordance with its own precedent, "[A] union-mandated arbitration agreement purporting to waive a covered workers' rights to a federal forum with respect to statutory rights is unenforceable." Pyett v. Pennsylvania Bldg. Co., 498 F.3d 88 (2d Cir. 2007). This has been the circuit's position since it decided Rogers v. New York Univ., 220 F.3d 73 (2d Cir. 2000).

In urging the U.S. Supreme Court to review the appellate court's decision, the defendants asserted, "[T]he lower federal courts are in irreconcilable conflict over when a union-negotiated arbitration clause may be enforceable." In contrast to the Second Circuit, the petitioners argued, the Court of Appeals for the Fourth Circuit, which has jurisdiction over Maryland, North Carolina, South Carolina, Virginia, and West Virginia, holds that voluntary, "clear and unmistakable" waivers are enforceable.

We will provide updates on this case and other Supreme Court cases affecting workplace law as they are available.