Important Supreme Court Decision with Collective Bargaining Implications

The U.S. Supreme Court recently issued a decision that could put unions in the position of agreeing to pursue the individual discrimination claims of bargaining unit employees under such statutes as the Civil Rights Act, the Americans with Disability Act, the Age Discrimination in Employment Act, and the Family and Medical leave Act, through the collective bargaining agreement’s grievance and arbitration procedure rather than leaving employees free to bring their own discrimination cases in court.

In 14 Penn Plaza v. Pyett, the Supreme Court by a 5-4 margin reversed its past case law and concluded that unions may agree in a collective bargaining agreement to waive the employees’ right to bring their individual statutory discrimination claims to court, and instead require that such claims can only be pursued under the agreement’s grievance and arbitration provisions. In fact, the Court majority found that the subject is a mandatory subject of bargaining, which raises the danger that employers may insist to impasse on such provisions.

Where a union is found to have agreed to such a provision, a bargaining unit employee’s statutory discrimination claim will have to be brought by the union under the grievance and arbitration procedure in the collective bargaining agreement and the individual will not be able to sue the employer in federal court. The Court specifically noted that employees who are not satisfied with the way the union pursues their statutory claims in the grievance procedure may sue the union for a breach of the duty of fair representation — in effect making the union potentially liable for the employer’s discrimination.

Analyzing the Pyett decision, it appears likely that, in the future, anti-discrimination language negotiated into a collective bargaining agreement that explicitly refers by name to the various statutes, along with a typical clause that all disputes arising under the agreement are subject to the grievance/arbitration procedure, will be sufficient to show that the parties agreed to use the contractual grievance/arbitration procedure as the exclusive procedure for statutory claims. Employers are expected to seek such provisions in future bargaining in an effort to short circuit the right of their employees to bring their own discrimination cases in court before juries. Whether these types of provisions negotiated prior to the Pyett decision will have the same effect remains to be seen.

We suggest that you review your Union’s current contracts and be aware of this potential issue during bargaining. If you have any questions, please feel free to contact this office.