Sunday, May 17, 2009

First Post-Pyett Case

Dna The U.S. District Court for the District of Colorado has issued the first post-Pyett case involving arbitration of statutory claims through a collective bargaining agreement.  The case raises as many questions as it resolves.

Plaintiff John Matthews, who was covered by a collective bargaining agreement, brought a national origin discrimination claim against his employer.  Unlike in Wright and Pyett, the arbitration clause in the collective bargaining agreement did not "clearly and unmistakably" waive an employee's right to sue for discrimination; to the contrary, it provided that employees were not required to arbitrate their statutory discrimination claims and could directly pursue their administrative and judicial remedies. 

Rather than doing so, however, Matthews pursued his discrimination through collective-bargaining arbitration. Moreover, rather than relying on the union to represent him, he hired his own counsel to prepare and present his case in the grievance arbitration hearing.  Thus, this case is significantly different from Pyett because Matthews at all times controlled the grievance, and he actually arbitrated it.

The case also is different from Gardner-Denver.  The Mathews anti-discrimination clause provided: "The Employer and the Union acknowledge continuation of their policies of no discrimination against employees and applicants on the basis of [the traditional prohibited characteristics] in accordance with and as required by applicable state and federal law."  Both the arbitrator and the parties treated this provision as expressly permitting the arbitrator to decide statutory claims.  This differed from Gardner-Denver, in which the Supreme Court assumed that an arbitrator deciding statutory claims would be acting outside the scope of his/her authority.

At the grievance arbitration hearing, Mathews apparently presented evidence and argument that the employer had violated federal law by discriminating against him.  This, too, was different from Gardner-Denver, because in that case the employee only argued (and the arbitrator only ruled on) the contractual discrimination claim, not the statutory claim.

The Mathews court held that Mathews, by electing to take his statutory discrimination claim to grievance arbitration and then vigorously pursuing it there, had waived his right to pursue the same claim in litigation.  The court also (alternatively?) stated (held?) that the arbitrated resolution of the claim precluded subsequent litigation on res judicata grounds.

I see this case as significantly different from Pyett.  In Pyett, the issue was whether a union may waive (in a collective bargaining agreement arbitration provision) an employee's right to take a discrimination claim to litigation.  In Mathews, the court did not find waiver from the cba, but rather found waiver from the employee's decision to arbitrate his discrimination claim.  The court cites to Pyett for the narrower proposition that discrimination claims are waivable through grievance arbitration.

Hat tip: Dennis Nolan, who may well disagree with my interpretation of Mathews.

The case is Mathews v. Denver Newspaper Agency, LLP, 2009 WL 1231776 (D. Colo. 2009).


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No, I don't disagree with your interpretation, Rick. It's completely accurate.

The interesting question, though, is whether the district court was correct. Apart from the specific reference to the arbitrator's authority, this case is pretty close to Gardner-Denver. As in Mathews, the plaintiff in that case had gone to arbitration, had an opportunity to present his discrimination claim, and lost. The Supreme Court cited the arbitrator's possible lack of authority as one reason for allowing Alexander to sue, but that didn't seem to be the important basis for the holding. The judge in Mathews applied the same election and/or preclusion arguments the Supreme Court declined to apply.

This presents the important question for future cases: Is Gardner-Denver no longer good law? Or is it limited to labor cases where there is no express grant of authority to the arbitrator to decide the statutory questions? If the latter, then what are we to make of arbitration decisions in which the arbitrator applies a statute because the parties have at least implicitly incorporated it in the cba?

Posted by: Dennis Nolan | May 17, 2009 1:07:56 PM

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