Austin v. Owens-Brockway Glass Container, Inc. , 78 F.3d 875 ( 1996 )

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
LINDA AUSTIN,
Plaintiff-Appellant,
v.
OWENS-BROCKWAY GLASS CONTAINER,
INCORPORATED,
No. 94-1213
Defendant-Appellee.
EQUAL EMPLOYMENT OPPORTUNITY
COMMISSION; EQUAL EMPLOYMENT
ADVISORY COUNCIL,
Amici Curiae.
LINDA AUSTIN,
Plaintiff-Appelleee,
v.
OWENS-BROCKWAY GLASS CONTAINER,
INCORPORATED,
No. 94-1265
Defendant-Appellant.
EQUAL EMPLOYMENT OPPORTUNITY
COMMISSION; EQUAL EMPLOYMENT
ADVISORY COUNCIL,
Amici Curiae.
Appeals from the United States District Court
for the Western District of Virginia, at Danville.
Jackson L. Kiser, Chief District Judge.
(CA-93-51-D)
Argued: February 3, 1995
Decided: March 12, 1996
Before WIDENER and HALL, Circuit Judges, and CHAPMAN,
Senior Circuit Judge.
_________________________________________________________________
Affirmed as modified and remanded by published opinion. Judge
Widener wrote the majority opinion, in which Senior Judge Chapman
joined. Judge Hall wrote a dissenting opinion.
_________________________________________________________________
COUNSEL
ARGUED: Barbara Rubin Hudson, Danville, Virginia, for Appellant.
Karen Marie Moran, Office of General Counsel, EQUAL EMPLOY-
MENT OPPORTUNITY COMMISSION, Washington, D.C., for
Amicus Curiae EEOC. Thomas Michael Lucas, Mary Chapman Ham-
ilton, VANDEVENTER, BLACK, MEREDITH & MARTIN, Nor-
folk, Virginia, for Appellee. ON BRIEF: James R. Neely, Jr.,
Deputy General Counsel, Gwendolyn Young Reams, Associate Gen-
eral Counsel, Vincent J. Blackwood, Assistant General Counsel,
Samuel A. Marcosson, Office of General Counsel, EQUAL
EMPLOYMENT OPPORTUNITY COMMISSION, Washington,
D.C., for Amicus Curiae EEOC. Robert L. O'Donnell, VANDE-
VENTER, BLACK, MEREDITH & MARTIN, Norfolk, Virginia, for
Appellee. Douglas S. McDowell, Ann Elizabeth Reesman, MCGUI-
NESS & WILLIAMS, Washington, D.C., for Amicus Curiae Advi-
sory Council.
_________________________________________________________________
OPINION
WIDENER, Circuit Judge:
Linda Austin filed suit in the United States District Court for the
Western District of Virginia against Owens-Brockway Glass Con-
tainer, Inc., alleging violations of Title VII and the Americans with
Disabilities Act (Disabilities Act or ADA). The district court granted
summary judgment in favor of Owens-Brockway because Miss Aus-
tin failed to submit her claims to mandatory arbitration under a collec-
2
tive bargaining agreement. Miss Austin appeals, claiming that the
district court incorrectly held that she was required to arbitrate her
statutory claims. Finding no error, we affirm with only slight modifi-
cation.
I.
Because the district court disposed of Miss Austin's claims on a
motion for summary judgment, all justifiable inferences of relevant
facts are drawn in favor of the plaintiff. The grant of summary judg-
ment is reviewed de novo. Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 255 (1986). Miss Austin worked for Owens-Brockway for
approximately 14 years until she was injured on the job in 1992. Her
physician released her for light-duty work in August 1992, but
Owens-Brockway informed her that no light-duty employment was
available. Instead, Miss Austin was put on medical leave and pro-
vided with workers' compensation benefits. While Miss Austin was
on leave, Owens-Brockway eliminated Miss Austin's job classifica-
tion of equipment cleaner/oiler-greaser. In June 1993, Miss Austin
met with Robert McCauley, the Director of Industrial Relations at
Owens-Brockway. She learned that Owens-Brockway had terminated
her employment and that she would not be reassigned to light-duty
work.
Miss Austin filed suit against Owens-Brockway on October 13,
1993. She alleged Owens-Brockway violated the Americans with Dis-
abilities Act, 42 U.S.C. § 12101 et seq ., and Title VII, 42 U.S.C.
§ 2000e et seq., by refusing to offer her light-duty work and by termi-
nating her employment while a male employee, the only other
employee in her eliminated job classification, was reassigned to
another position at the plant.
Owens-Brockway filed a motion to dismiss for lack of subject mat-
ter jurisdiction. The company argued that Miss Austin failed to file
her claim with the EEOC and had not obtained a right to sue letter,
both prerequisites to filing Disabilities Act and Title VII claims in
court. See 42 U.S.C. §§ 2000e-5(b), 12117(a). Further, Owens-
Brockway took the position that Miss Austin's claims were subject to
mandatory arbitration under a collective bargaining agreement cover-
ing her employment with Owens-Brockway. Because Miss Austin
3
failed to file a claim under the grievance-arbitration procedure,
Owens-Brockway maintained that she was precluded from filing suit
in federal court.
Owens-Brockway offered affidavits in support of its motion to dis-
miss, so the district court treated the motion as one for summary judg-
ment. Fed. R. Civ. P. 12(b). The district court found that a significant
factual dispute existed as to what actions Miss Austin took to file her
complaint with the EEOC, and therefore, without deciding the ques-
tion, declined to grant summary judgment for failure to file a claim
or obtain a right to sue letter.1
The district court granted summary judgment in favor of Owens-
Brockway based on Miss Austin's failure to process her claims under
the grievance-arbitration procedure in the collective bargaining agree-
ment. The court held that that agreement subjected Miss Austin's
claims to mandatory arbitration. Thus, the court held that under
Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991), because
she did not submit her claim to arbitration under the collective bar-
gaining agreement, she was precluded from bringing the lawsuit.
II.
A.
Miss Austin first takes the position that she did not have standing
under the collective bargaining agreement to arbitrate her dispute with
her employer for gender and disability-based claims of discrimina-
tion. The argument goes that having no standing, she could not com-
ply with the contract. She now takes the position that she had been
_________________________________________________________________
1 Since a valid agreement to arbitrate future disputes effectively ousts
a court of jurisdiction, see Big Vein Pochahontas Co. v. Browning, 120
S.E. 487 (Va. 1928); Burks Pleading and Practice , § 12 (4th ed. 1952),
each of the two defenses asserted here is essentially a plea to the jurisdic-
tion. We need decide only one of them and decide the failure to submit
the claim to the grievance-arbitration procedure. The cross-appeal of
Owens-Brockway, No. 94-1265, with respect to filing a claim with the
EEOC and obtaining a right to sue letter is dismissed without prejudice,
and we express no opinion on the question.
4
discharged and, as a discharged employee, she had no standing to
request or demand arbitration of such claims. There is no merit to this
position, however. First, the district court found that the alleged dis-
crimination plaintiff complains of occurred on June 1, 1993, the date
the defendant terminated Miss Austin's employment. It also found
that on June 1, 1993, the April 1, 1993 - March 31, 1996 Union Shop
Contract was in effect. Plaintiff takes no exception to these findings.
So any contractual rights plaintiff may have had on account of that
discrimination arose during the term of the collective bargaining
agreement in question and plaintiff could assert her rights under that
contract. Second, even if plaintiff had been a terminated employee,
she could have asserted any rights she had under the collective bar-
gaining agreement even after its termination. Nolde Bros. Inc. v.
Local No. 358, Bakery & Confectionery Workers Union , 430 U.S. 243
(1977), affirmed our decision that an employer and employee's "arbi-
tration duties under the [collective bargaining] contract survived its
termination with respect to claims arising by reason of the collective
bargaining agreement." 430 U.S. at 248. Nolde Bros. held that a
"Union's claim for severance pay under [an] . . . expired collective
bargaining agreement [was] . . . subject to resolution under the arbi-
tration provision of that contract." 430 U.S. at 243. We do not think
the case before us is different from Nolde Bros. in any significant
degree.
Accordingly, we are of opinion and decide that Miss Austin had
standing to assert her claims under the collective bargaining agree-
ment.
B.
The next argument of Miss Austin is that arbitration of her Title
VII and disability claims is permissive rather than mandatory. She
relies on Section 1, Article 32 of the collective bargaining agreement
which states that "[a]ll disputes not settled pursuant to the procedures
set forth in Article 31, Grievance Procedures, may be referred to arbi-
tration." She takes the position that the use of the word "may" as just
stated makes arbitration permissive rather than obligatory. We are of
opinion, however, that the purpose of the word "may" in this section
of the collection bargaining agreement is to give an aggrieved party
the choice between arbitration and abandonment of his claim, he
5
"may" either arbitrate or abandon the claim. The interpretation urged
by Miss Austin would render the arbitration provision meaningless
for all practical purposes. If the parties to such an agreement intended
for arbitration to be permissive, there would be no reason to include
Article 32, the arbitration provision in the contract, for the parties to
an existing dispute could always voluntarily submit it to arbitration.
Almost identical words ("either party may request arbitration") in a
fact situation indistinguishable from that at hand has received the
same construction we place upon it by the Eighth Circuit in Bonnot
v. Congress of Independent Unions, Local No. 14, 331 F.2d 355, 359
(8th Cir. 1964), which followed Deaton Truck Lines, Inc. v. Local
Union 612, 314 F.2d 418, 422 (5th Cir. 1963). See also American
Italian Pasta Co. v. Austin Co., 914 F.2d 1103, 1104 (8th Cir. 1990).
Thus, we decide that the arbitration provisions in the collective bar-
gaining agreement are obligatory and not permissive.
III.
A.
In deciding whether to enforce the arbitration provision in this col-
lective bargaining agreement, we start with and rely upon the "well-
recognized policy of federal labor law favoring arbitration of labor
disputes." Adkins v. Times-World Corp., 771 F.2d 829, 831 (4th Cir.
1985), cert. denied, 474 U.S. 1109 (1986). In the Steelworkers
Trilogy, the Supreme Court established that arbitration is favored in
labor disputes. See e.g., United Steelworkers of America v. Enterprise
Wheel & Car Corp., 363 U.S. 593 (1960); United Steelworkers of
America v. Warrior & Gulf Navigation Co., 363 U.S. 574 (1960);
United Steelworkers of America v. American Manufacturing Co., 363
U.S. 564 (1960). We need not rely on the Federal Arbitration Act
(FAA), 9 U.S.C. § 1 et seq., in this case because, in this circuit, the
FAA is not applicable to labor disputes arising from collective bar-
gaining agreements. Domino Sugar Corp. v. Sugar Workers Local
Union 392, 10 F.3d 1064, 1067 (4th Cir. 1993).
B.
The collective bargaining agreement specifically provides that
claims of gender and disability discrimination are subject to the griev-
ance procedure:
6
ARTICLE 38
Fair Employment Practice and
Equal Opportunities
1. The Company and the Union will comply with all
laws preventing discrimination against any employee
because of race, color, religion, sex, national origin, age,
handicap, or veteran status.
2. This Contract shall be administered in accordance
with the applicable provisions of the Americans with Dis-
abilities Act. Before taking action relative to this Section,
the Company will meet with the Local Union, and both par-
ties will have sufficient opportunity to express their opinions
regarding an anticipated action.
3. Any disputes under this Article as with all other Arti-
cles of this Contract shall be subject to the grievance proce-
dure.
Therefore, Miss Austin contractually agreed to submit her discrimina-
tion claims to the grievance procedure.
The grievance procedure specifically provides for binding arbitra-
tion.
ARTICLE 32
Arbitration
1. All disputes not settled pursuant to the procedure set
forth in Article 31, Grievance Procedure, may be referred to
arbitration by a notice given to the company or the union by
the other within 10 days after the conclusion of Step 4 of the
grievance procedure. . . .
* * * *
5. . . . . The arbitrator's decision shall be final and bind-
ing upon both parties.
7
As we have just demonstrated above, the collective bargaining
agreement specifically provides for final and binding arbitration on
account of each complaint asserted here: Title VII for the gender
claim, and the Disabilities Act for the disability claim. And in part
II.B, we have decided that such arbitration is obligatory, not discre-
tionary.
C.
In Gilmer, the Supreme Court made clear that agreements to arbi-
trate statutory claims are enforceable. Gilmer , 500 U.S. at 26. The
Gilmer Court recognized that arbitration of a statutory claim is not
equal to giving up any right under a statute, it is simply another forum
in which to resolve the dispute:
[B]y agreeing to arbitrate a statutory claim, a party does not
forgo the substantive rights afforded by the statute; it only
submits to their resolution in an arbitral, rather than a judi-
cial, forum.
Gilmer, 500 U.S. at 26 (quoting Mitsubishi Motors Corp. v. Soler
Chrysler-Plymouth, Inc., 473 U.S. 614, 628 (1985)). Gilmer thus
rejects the principal concern in Alexander v. Gardner-Denver Co.,
415 U.S. 36 (1974), that arbitration is an "inappropriate forum" for
the resolution of Title VII statutory rights. Alexander, 415 U.S. at 56.
Emphasizing its support of arbitration as a method of dispute reso-
lution, the Gilmer Court stated:
[A]ttacks on [the adequacy] of arbitration "res[t] on suspi-
cion of arbitration as a method of weakening the protections
afforded in the substantive law to would-be complainants,"
and as such, they are "far out of step with our current strong
endorsement of the federal statutes favoring this method of
resolving disputes."
Gilmer, 500 U.S. at 30 (third alteration in original) (quoting
Rodriguez de Quijas v. Shearson/American Express, Inc., 490 U.S.
477, 481 (1989)). The Court rejected arguments that arbitration panels
8
may be biased; that limited discovery would hinder a plaintiff
attempting to prove discrimination; that lack of a written opinion
would result in decreased public awareness of discriminatory employ-
ment policies and ineffective appellate review; and that employers
and employees have unequal bargaining power. Gilmer, 500 U.S. at
30-33. The Court refused to presume that arbitrators would be biased,
Gilmer, 500 U.S. at 30; explained that choosing arbitration means
"trad[ing] the procedures and opportunity for review of the courtroom
for the simplicity, informality, and expedition of arbitration," Gilmer,
500 U.S. at 31 (quoting Mitsubishi, 473 U.S. at 628); noted that judi-
cial review of arbitration awards, although limited, is adequate to
ensure compliance with statutory requirements, Gilmer, 500 U.S. at
32 n.4; refused to decide that lack of class actions should bar arbitra-
tion, because individual conciliation should not be barred; and
decided that the claim of unequal bargaining power is one that should
be decided in individual cases, Gilmer, 500 U.S. at 32-33.
Gilmer further provides that once parties have contracted to arbi-
trate a statutory matter, the parties should be held to that agreement
unless Congress intended to prohibit arbitration of that matter:
"[H]aving made the bargain to arbitrate, the party should be
held to it unless Congress itself has evinced an intention to
preclude a waiver of judicial remedies for the statutory
rights at issue." . . . If such an intention exists, it will be dis-
coverable in the text of the [statute], its legislative history,
or an "inherent conflict" between arbitration and the [stat-
ute's] underlying purposes.
Gilmer, 500 U.S. at 26 (quoting Mitsubishi , 473 U.S. at 628).
The language of the statutes could not be any more clear in show-
ing Congressional favor towards arbitration. The Civil Rights Act of
1991, amending Title VII, states:
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 the Acts or provisions of Federal law amended by this
title.
9
Pub. L. No. 102-166, § 118, 105 Stat. 1071, 1081. The Americans
with Disabilities Act contains identical language:
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.
42 U.S.C. § 12212. The meaning of this language is plain--Congress
is in favor of arbitration.
A study of the legislative history of the Civil Rights Act and the
Disabilities Act also does not reveal Congressional hostility towards
arbitration, rather Congress has encouraged arbitration. See H.R. Rep.
No. 40(II), 102d Cong., 1st Sess. 78, reprinted in 1991 U.S.C.C.A.N.
694, 764; H.R. Rep. No. 40(I), 102d Cong., 1st Sess. 97, reprinted in
1991 U.S.C.C.A.N. 549, 635; H.R. Conf. Rep. No. 755, 101st Cong.,
2d Sess. (1990); H.R. Conf. Rep. No. 596, 101st Cong., 2d Sess. 89
(1990), reprinted in 1990 U.S.C.C.A.N. 565, 598; H.R. Rep. No.
485(III), 101st Cong., 2d Sess. 76-77, reprinted in 1990 U.S.C.C.A.N.
445, 499-500. Gilmer provides that we look for a Congressional intent
to preclude arbitration of the particular statutory rights. Gilmer, 500
U.S. at 26. We do not find that intent in the legislative history. In fact,
the legislative history for both the Disabilities Act and the Civil
Rights Act contains statements that demonstrate the opposite intent:
This section encourages the use of alternative means of dis-
pute resolution, where appropriate and to the extent autho-
rized by law. . . .
This amendment was adopted to encourage alternative
means of dispute resolution that are already authorized by
law.
H.R. Conf. Rep. No. 755, 101st Cong., 2d Sess. (1990) (Civil Rights
Act); H.R. Rep. No. 485(III), 101st Cong., 2d Sess. 76, reprinted in
1990 U.S.C.C.A.N. 445, 499 (ADA).
Granted, the legislative history of the statutes is not as clear as the
statutes themselves that Congress intended to allow arbitration of stat-
10
utory claims, and one of the conference reports does indicate that
arbitration is permissible when voluntary. H.R. Conf. Rep. No. 596,
101st Cong., 2d Sess. 89 (1990), reprinted in 1990 U.S.C.C.A.N. 565,
598 ("It is the intent of the conferees that the use of these alternative
dispute resolution procedures is completely voluntary."). In this cir-
cuit, conference reports are the most persuasive evidence of legisla-
tive intent, after the statute itself. Davis v. Lukhard, 788 F.2d 973, 981
(4th Cir.), cert. denied, 479 U.S. 868 (1986). Furthermore, a commit-
tee report states that "voluntary mediation and arbitration are far pref-
erable to prolonged litigation for resolving employment
discrimination claims." H.R. Rep. No. 40(II), 102d Cong., 1st Sess.
78, reprinted in 1991 U.S.C.C.A.N. 694, 764. Another committee
report contains a statement about what that committee "believes" the
effect of the statute is, however, that committee's belief is not disposi-
tive of what Congress intended when it enacted the statute. H.R. Rep.
No. 40(I), 102d Cong., 1st Sess. 97, reprinted in 1991 U.S.C.C.A.N.
549, 635 ("[T]he Committee believes that any agreement to submit
disputed issues to arbitration, . . . does not preclude the affected per-
son from seeking relief under the enforcement provisions of Title VII.
This view is consistent with . . . Alexander. . . ."). We need not
decide what the legislative history means in absolute terms because
in our case it means that voluntary agreements to arbitrate statutory
claims are allowed. To decide otherwise, we would have to hold that
Gilmer has no effect at all and that Alexander is still the law that stat-
utory claims cannot be the subject of required arbitration. We do not
think Congress intended to return to the old law. Miss Austin's bur-
den under Gilmer is to show that Congress intended to preclude arbi-
tration of statutory claims, and she has failed to meet that burden.
Even if the provisions of the legislative history are contrary to the
statute, the statute must prevail. Davis v. Lukhard, 788 F.2d at 981.
Especially in that event, the reasoning of Justice Scalia, concurring,
in Thompson v. Thompson, 484 U.S. 174, 188, 191-192 (1988),
should apply: "Committee reports, floor speeches, and even collo-
quies between Congressmen, . . . [only page references omitted] are
frail substitutes for bicameral vote upon the text of a law and its pre-
sentment to the President."
Moreover, there is no inherent conflict between arbitration and the
underlying purposes of the Disabilities Act or Title VII. Although
Gilmer involved a claim under the Age Discrimination in Employ-
11
ment Act of 1967, 29 U.S.C. § 621 et seq ., the principles behind the
Age Discrimination Act are the same as those behind the Disabilities
Act and Title VII. The statement of the Court in response to Gilmer's
claim that compulsory arbitration would be inconsistent with the pur-
poses of the Age Discrimination Act holds true for any claim that
compulsory arbitration would be inconsistent with the policies behind
the Disabilities Act and Title VII. The Court replied:
As Gilmer contends, the ADEA is designed not only to
address individual grievances, but also to further important
social policies. We do not perceive any inherent inconsis-
tency between those policies, however, and enforcing agree-
ments to arbitrate age discrimination claims. It is true that
arbitration focuses on specific disputes between the parties
involved. The same can be said, however, of judicial resolu-
tion of claims. Both of these dispute resolution mechanisms
nevertheless also can further broader social purposes. The
Sherman Act, the Securities Exchange Act of 1934, RICO,
and the Securities Act of 1933 all are designed to advance
important public policies, but, as noted above, claims under
those statutes are appropriate for arbitration."[S]o long as
the prospective litigant effectively may vindicate[his or her]
statutory cause of action in the arbitral forum, the statute
will continue to serve both its remedial and deterrent func-
tion."
Gilmer, 500 U.S. at 28 (alterations in original) (internal citations
omitted) (quoting Mitsubishi, 473 U.S. at 637). The Court clearly has
removed any doubt that age discrimination claims may be arbitrated.
We are of opinion that the same reasoning is valid for gender and dis-
ability discrimination claims.
D.
Every case decided in the Courts of Appeal under§ 118 of the
1991 amendments to the Civil Rights Act has enforced anticipatory
agreements to arbitrate claims involving statutory rights.2 Three
_________________________________________________________________
2 The dissent relies upon Tran v. Tran, 54 F.3d 115 (2d Cir. 1995), for
a conflict in the circuits. We think that reliance is misplaced, for Tran
12
federal cases arose in the context of arbitration clauses in employment
contracts growing out of securities registration applications.
_________________________________________________________________
was a wage and hour case and has few similarities to the case at hand,
as we will now discuss.
The first, and a patent difference, is that the wage and hour law, 29
U.S.C. § 201, et seq. (the Fair Labor Standards Act) does not contain any
provision encouraging arbitration as does Title VII (§ 118 of the 1991
amendment), and the Disabilities Act (42 U.S.C.§ 12212), each of which
states that "arbitration is encouraged to resolve disputes arising under"
the respective statutes.
If that were not all, the Court has stated in Gilmer that ". . . all statu-
tory claims may not be appropriate for arbitration .. . ." 500 U.S. at 26.
In Barrentine v. Arkansas-Best Freight Systems, Inc., 450 U.S. 728
(1981), a wage and hour case which involved an arbitration provision in
a collective bargaining agreement, the Court declined to require arbitra-
tion prior to filing suit, principally on the ground that it had held that
"congressionally granted FLSA rights take precedence over conflicting
provisions in a collective bargaining compensation arrangement," 450
U.S. at 740, and followed four of its previous decisions in that respect.
450 U.S. at 741. Similarly, as the dissent relies on McDonald v. West
Branch, 466 U.S. 284 (1984), and Livadas v. Bradshaw, 62 U.S.L.W.
4495 (1994), we note that both McDonald and Livadas are cases under
42 U.S.C. § 1983, and that McDonald reasoned that "an arbitration pro-
ceeding cannot provide an adequate substitution for a judicial trial." 466
U.S. at 292. Livadas's reasoning was that"Congress, of course, has
given no more indication of any intent to foreclose actions like Livadas's
than the sort brought by the cab company [in the Golden State cases]."
62 U.S.L.W. at 4503.
Tran depends on Barrentine for its decision that an employee, subject
to a collective bargaining agreement with an arbitration procedure, is not
required to arbitrate wage and hour claims prior to filing suit under the
Fair Labor Standards Act, 29 U.S.C. § 201 et seq. With respect to dis-
crimination claims, however, the Supreme Court distinguished
Barrentine in Gilmer itself by stating that "reliance . . . is misplaced" "on
Alexander and its progeny, Barrentine . . . and McDonald . . . .", for the
proposition that would "preclude arbitration of employment discrimina-
tion claims." Gilmer, 500 U.S. at 33. Gilmer continued with regard to the
Alexander line of cases:
First, those cases did not involve the issue of the enforceability
of an agreement to arbitrate statutory claims. Rather, they
involved the quite different issue whether arbitration of contract-
based claims precluded subsequent judicial resolution of statu-
13
Bender v. A.G. Edwards & Sons, Inc., 971 F.2d 698 (11th Cir. 1992);
Willis v. Dean Witter Reynolds, Inc., 948 F.2d 305 (6th Cir. 1991);
Alford v. Dean Witter Reynolds, Inc., 939 F.2d 229 (5th Cir. 1991).
A fourth federal case arose in the context of an arbitration clause in
an ordinary employment contract. Mago v. Shearson Lehman Hutton,
Inc., 956 F.2d 932 (9th Cir. 1992). And two state cases also arose in
the context of arbitration clauses in employment contracts growing
out of securities registration applications. Benefits Communications
Corp. v. Klieforth, 642 A.2d 1299 (D.C. 1994); Fletcher v. Kidder,
Peabody & Co., 619 N.E.2d 998 (N.Y. 1993), cert. denied, 62
U.S.L.W. 3369 (U.S. Nov. 29, 1993).
Bender v. A.G. Edwards & Sons, Inc. involved an employee who,
in her application for registration as a stock broker, agreed to arbitrate
employment disputes. Bender, 971 F.2d at 699. When the employee
filed a sexual harassment suit in federal court, the employer moved
_________________________________________________________________
tory claims. Since the employees there had not agreed to arbi-
trate their statutory claims, and the labor arbitrators were not
authorized to resolve such claims, the arbitration in those cases
understandably was held not to preclude subsequent statutory
actions. Second, because the arbitration in those cases occurred
in the context of a collective-bargaining agreement, the claim-
ants there were represented by their unions in the arbitration pro-
ceedings. An important concern therefore was the tension
between collective representation and statutory rights, a concern
not applicable to the present case. Finally, those cases were not
decided under the FAA, which, as discussed above, reflects a
"liberal federal policy favoring arbitration agreements."
Gilmer, 500 U.S. at 35 (quoting in the last two lines, Mitsubishi, 473
U.S. at 625). Our case, like Gilmer, involves the issue of the enforceabil-
ity of an agreement to arbitrate statutory claims. This case arises in the
context of a collective bargaining agreement so there may be concern for
any tension between collective representation and statutory rights. As we
find in part III.B, however, Miss Austin is a party to a voluntary agree-
ment which has explicitly agreed to the arbitration of her statutory com-
plaints. That should be enforced. Finally, as noted in part III.A, although
we do not rely on the FAA in this case, we do rely on the federal labor
law policy encouraging arbitration of labor disputes as expressed in the
Steelworkers Trilogy.
14
to stay the case pending arbitration under the Federal Arbitration Act,
9 U.S.C. § 1 et seq. Bender, 971 F.2d at 699. The Eleventh Circuit
found, in light of Gilmer, that Title VII claims can be subject to com-
pulsory arbitration and remanded the case with orders that the district
court stay federal court proceedings pending the employee's arbitra-
tion of her Title VII claim. Bender, 971 F.2d at 699, 701.
Willis v. Dean Witter Reynolds, Inc. also involved an employee
who agreed to arbitrate employment disputes when she signed a
securities registration form. Willis, 948 F.2d at 306. When the
employee filed state claims of sexual harassment and gender discrimi-
nation in a Kentucky court, the employer removed the case to federal
court based on diversity jurisdiction. Willis , 948 F.2d at 306. The
employee then amended her complaint to include a claim under Title
VII. Willis, 948 F.2d at 306. The Sixth Circuit noted that the Supreme
Court, in Gilmer, held enforceable the same arbitration clause at issue
in that case. Willis, 948 F.2d at 307. The court discussed Gilmer's
rejection of the Alexander principle that employment discrimination
claims could not be arbitrated and Gilmer's support of arbitration as
an alternative forum for resolution of disputes involving statutory
rights. Willis, 948 F.2d at 308-10. The court concluded that the
employee's discrimination claim was subject to her agreement to arbi-
trate. Willis, 948 F.2d at 312.
Alford v. Dean Witter Reynolds, Inc., was yet another case in which
an employee sued her stock broker employer and alleged a violation
of Title VII. Alford, 939 F.2d at 229. The case was first decided
favorably to Alford in the lower courts, but the Supreme Court
vacated the judgment of the Fifth Circuit and remanded the case for
consideration in light of Gilmer. Alford , 939 F.2d at 229. The Fifth
Circuit compared Title VII to the Age Discrimination Act, under
which the Supreme Court decided Gilmer, and concluded that because
the civil rights statutes were similar, claims under Title VII could be
arbitrated just as claims under the Age Discrimination Act could be
arbitrated. Alford, 939 F.2d at 230. The court noted Gilmer's rejection
of the Alexander principle that arbitration was unfavored. Alford, 939
F.2d at 230.
Mago v. Shearson Lehman Hutton, Inc. involved an employee who,
in her employment application, agreed to arbitrate employment dis-
15
putes. Mago, 956 F.2d at 933-34. When the employee filed a sexual
harassment and gender discrimination suit against her employer, the
employer moved to stay the case pending compulsory arbitration.
Mago, 956 F.2d at 934. The Ninth Circuit concluded that the
employee did not meet her burden under Gilmer of proving that Con-
gress intended to preclude arbitration of Title VII claims and enforced
the arbitration agreement. Mago, 956 F.2d at 935.
The District of Columbia Court of Appeals also has enforced an
anticipatory agreement, in a securities registration application, to arbi-
trate employment disputes. Benefits Communications Corp. v.
Klieforth, 642 A.2d 1299 (D.C. 1994). The employee filed a gender
discrimination suit in Superior Court prior to the Supreme Court's
Gilmer decision, and six weeks after Gilmer was decided the
employer moved to compel arbitration. Klieforth , 642 A.2d at 1300.
Although the employee's claim arose under the District of Colum-
bia's Human Rights Act, the court explained that it usually looked to
federal civil rights cases for guidance in interpreting the Human
Rights Act. Klieforth, 642 A.2d at 1301-02. The court noted that
Gilmer held that an agreement to arbitrate age discrimination claims
could be enforced and that every federal court of appeals to decide the
issue has extended Gilmer to cover Title VII discrimination claims.
Klieforth, 642 A.2d at 1302 (citing Bender, Mago, Willis, and Alford).
The court recognized that federal precedent "holds that employment
discrimination claims can be subject to arbitration if the employer and
employee have agreed to arbitrate disputes of that nature." Klieforth,
642 A.2d at 1303. Accordingly, the court found that the arbitration
agreement was enforceable. Klieforth, 642 A.2d at 1304.3
_________________________________________________________________
3 The court also found that the 1991 amendments to the Civil Rights
Act of 1964 did not modify or overrule Gilmer . Klieforth, 642 A.2d at
1304. While we agree with the court's statement that the statute on its
face "expressly encourage[s]" arbitration as an alternative to litigation,
we are not in entire agreement with the statement that it is not necessary
to consider the statute's legislative history. Klieforth, 642 A.2d at 1305.
Gilmer names legislative history as a place to look to discover Congres-
sional intent to preclude arbitration of statutory claims. Gilmer, 500 U.S.
at 26.
16
The Court of Appeals of New York has addressed the enforceabil-
ity of agreements to arbitrate statutory claims, again in the context of
employment contracts growing out of securities registration applica-
tions, and held that the agreements were enforceable. Fletcher v. Kid-
der, Peabody, Co., 619 N.E.2d 998, 1005-06 (N.Y. 1993). Fletcher
consolidated two cases, one involved a race discrimination claim and
the other involved a gender discrimination claim. Fletcher, 619
N.E.2d at 1000. The employees had agreed to arbitrate employment
disputes when they signed securities registration applications at their
respective firms. One employee filed a race discrimination claim and
the other employee filed a gender discrimination claim, and each
employer moved to compel arbitration under the respective agree-
ments. Fletcher, 619 N.E.2d at 1000. In light of Gilmer, the court
overruled a prior decision that held that anticipatory agreements to
arbitrate employment discrimination claims were not enforceable.
Fletcher, 619 N.E.2d at 1003. Finding Title VII comparable to the
state law under which the case was to be decided, the court analyzed
the legislative history of Title VII to find evidence of Congressional
intent to prohibit anticipatory agreements to arbitrate statutory dis-
putes. The court found no evidence of any such intent. Fletcher, 619
N.E.2d at 1003. The court discussed Gilmer's recognition of arbitra-
tion as a favorable method of dispute resolution and stated that after
Gilmer, the question is "whether Congress, in creating a statutory
remedy, intended that arbitration of the statutorily established claim
would be foreclosed." Fletcher, 619 N.E.2d at 1004.
The only difference between these six cases and this case is that
this case arises in the context of a collective bargaining agreement.
Bender, Willis, Alford, Klieforth, and Fletcher arose in the context of
employment contracts growing out of securities registration applica-
tions, and Mago also arose in the context of an employment contract.
In all of the cases, however, including the case at hand, the employee
attempting to sue had made an agreement to arbitrate employment
disputes. Whether the dispute arises under a contract of employment
growing out of securities registration application, a simple employ-
ment contract, or a collective bargaining agreement, an agreement has
yet been made to arbitrate the dispute. So long as the agreement is
voluntary, it is valid, and we are of opinion it should be enforced.
17
E.
A union has the right and duty to bargain for the terms and condi-
tions of employment. 29 U.S.C. § 158(d). Through the collective bar-
gaining process, unions may waive the right to strike and other rights
protected under the National Labor Relations Act, 29 U.S.C. § 151 et
seq. Metropolitan Edison Co. v. NLRB, 460 U.S. 693, 705 (1983).
The Supreme Court finds such waivers "valid because they rest on the
premise of fair representation." Metropolitan Edison, 460 U.S. at 705
(citations omitted). There is no reason to distinguish between a union
bargaining away the right to strike and a union bargaining for the
right to arbitrate. The right to arbitrate is a term or condition of
employment, and as such, the union may bargain for this right. This
has been the law at least since Textile Workers v. Lincoln Mills, 353
U.S. 448 (1957): "Plainly the agreement to arbitrate grievance dis-
putes is the quid pro quo for an agreement not to strike." Lincoln
Mills, 353 U.S. at 455.
F.
Finally, the rule of the Supreme Court and this circuit is that an
employee must follow the grievance procedure established by the col-
lective bargaining agreement prior to filing suit in federal court.
Republic Steel Corp. v. Maddox, 379 U.S. 650, 652 (1965); Adkins v.
Times-World Corp., 771 F.2d 829, 832 (4th Cir. 1985), cert. denied,
474 U.S. 1109 (1986). Thus, an employee cannot sue an employer
without first going through the grievance procedure, and this is what
Miss Austin is attempting to do. We need not decide any question of
union good faith in this case (and none has been suggested), because
Miss Austin must pursue her claim under the grievance procedure.
Miss Austin is a party to a voluntary agreement to submit statutory
claims to arbitration. The collective bargaining agreement specifically
lists gender and disability discrimination as claims that are subject to
arbitration. This voluntary agreement is consistent with the text of
Title VII and the Disabilities Act, the legislative intent behind those
statutes, and the purposes of those statutes. Finding that Congress did
not intend to preclude arbitration of claims under Title VII and the
Disabilities Act, we hold that the arbitration provision in this collec-
tive bargaining agreement is enforceable.
18
IV.
We express no opinion as to whether or not arbitration may now
be available or the result thereof. That question is not before us.
We have examined the final order disposing of the case in the dis-
trict court and are not clear as to whether or not the disposition was
without prejudice to the merits of Miss Austin's claim. Since we have
affirmed an adjudication that the court could not hear the same
because of agreed-upon arbitration, the dismissal of the case should
be without prejudice to the merits of the claim asserted. Whether or
not Miss Austin has abandoned her claim or otherwise rendered it
unenforceable by choosing to attempt to litigate the same rather than
arbitrate it is also a question upon which we express no opinion.
On remand, the district court will amend its order dismissing the
case to insure it expresses no opinion on the merits of the claim, or
whether or not the same is subject to arbitration, or whether or not it
may now be so asserted.
The judgment of the district court is accordingly
AFFIRMED AS MODIFIED AND THE CASE IS REMANDED.
HALL, Circuit Judge, dissenting:
I respectfully dissent.
After its inventory of cases that follow the holding of Gilmer v.
Interstate/Johnson Lane Corp., 500 U.S. 20 (1991), the majority con-
cludes, "[t]he only difference between these . . . cases and this case
is that this case arises in the context of a collective bargaining agree-
ment." Supra at 17. I agree. The majority fails to recognize, however,
that the only difference makes all the difference. A labor union may
not prospectively waive a member's individual right to choose a judi-
cial forum for a statutory claim.
I.
In Alexander v. Gardner-Denver Co., 415 U.S. 36 (1974), a unani-
mous Supreme Court held that a person may sue under Title VII not-
19
withstanding that he has submitted his claims to arbitration under a
collective bargaining agreement and lost. In reaching this conclusion,
the Court stated that an employee's individual statutory right is com-
pletely independent of any contractual right he may have under a col-
lective bargaining agreement, and the individual rights of employees
are not subject to waiver by their union:
In submitting his grievance to arbitration, an employee
seeks to vindicate his contractual right under a collective-
bargaining agreement. By contrast, in filing a lawsuit under
Title VII, an employee asserts independent statutory rights
accorded by Congress. The distinctly separate nature of
these contractual and statutory rights is not vitiated merely
because both were violated as a result of the same occur-
rence. And certainly no inconsistency results from permit-
ting both rights to be enforced in their respectively
appropriate forums.
* * *
. . . [W]e think it clear that there can be no prospective
waiver of an employee's rights under Title VII. It is true, of
course, that a union may waive certain statutory rights
related to collective activity, such as the right to strike. [cites
omitted] These rights are conferred on employees collec-
tively to foster the processes of bargaining and properly may
be exercised or relinquished by the union as collective-
bargaining agent to obtain economic benefits for union
members. Title VII, on the other hand, stands on plainly dif-
ferent ground; it concerns not majoritarian processes, but an
individual's right to equal employment opportunities. Title
VII's strictures are absolute and represent a congressional
command that each employee be free from discriminatory
practices. Of necessity, the rights conferred can form no part
of the collective-bargaining process since waiver of these
rights would defeat the paramount congressional purpose
behind Title VII. In these circumstances, an employee's
rights under Title VII are not susceptible of prospective
waiver.
20
* * *
We think, therefore, that the federal policy favoring arbi-
tration of labor disputes and the federal policy against dis-
criminatory employment practices can best be
accommodated by permitting an employee to pursue fully
both his remedy under the grievance-arbitration clause of a
collective-bargaining agreement and his cause of action
under Title VII. The federal court should consider the
employee's claim de novo.
415 U.S. at 49-52, 59-60. Thus, under Gardner-Denver, a clause in
which a union purported to waive employees' rights to pursue Title
VII claims in court would be clearly unenforceable. Gardner-Denver
was closely adhered to in Barrentine v. Arkansas-Best Freight Sys-
tem, Inc., 450 U.S. 728 (1981), and McDonald v. City of West Branch,
466 U.S. 284 (1984).
II.
Gilmer did not overrule this line of authority. The Supreme Court
has said so, twice.
First of all, in Gilmer itself, the Court enforced an agreement to
arbitrate contained in an individual (not collective) contract between
a stockbroker and his employer. Writing for a seven-member major-
ity, Justice White was careful to distinguish Gardner-Denver. Though
he eschewed language in Gardner-Denver that expressed judicial mis-
trust of arbitration, he left its holding intact. He explained that the col-
lective bargaining agreements in Gardner-Denver and its progeny did
not contain the agreement of the employees to arbitrate statutory
claims. Second, and of central importance here, because labor arbitra-
tions involve contracts negotiated by unions, "[a]n important concern
therefore was the tension between collective representation and indi-
vidual statutory rights, a concern not applicable to the present case."
Finally, Gilmer, unlike the labor cases, arose under the Federal Arbi-
tration Act. 500 U.S. at 35.
In a more recent unanimous decision, the Court reiterated the vital-
ity of Gardner-Denver, albeit in dicta:
21
In holding that an agreement to arbitrate an Age Discrimi-
nation in Employment Act claim is enforceable under the
Federal Arbitration Act, Gilmer emphasized its basic consis-
tency with our unanimous decision in [Gardner-Denver].
Livadas v. Bradshaw, 114 S. Ct. 2068, 2080 n.21 (1994).
Several federal courts have recognized that Gardner-Denver, rather
than Gilmer, continues to govern in the context of collective bargain-
ing agreements. Tran v. Tran, 54 F.3d 115, 117, 118 (2nd Cir. 1995);
Humphrey v. Council of Jewish Federations, 901 F. Supp. 703, 709-
710 (S.D.N.Y. 1995); Jackson v. Quanex Corp., 889 F. Supp. 1007,
1010-1011 (E.D.Mich. 1995); Randolph v. Cooper Industries, 879
F. Supp. 518, 520-522 (W.D.Pa. 1994); Block v. Art Iron, Inc., 866
F. Supp. 380, 384-387 (N.D.Ind. 1994); Griffith v. Keystone Steel &
Wire Co., 858 F. Supp. 802, 804 (C.D.Ill. 1994); Claps v. Moliterno
Stone Sales, Inc., 819 F. Supp. 141, 145-147 (D.Conn. 1993). The case
first above listed is a decision of the Court of Appeals for the Second
Circuit; consequently, the majority's holding will create a split among
the circuits.
Gardner-Denver is the law. Austin may pursue her contractual
remedy, her statutory remedy, or both. The judgment of the district
court should be reversed.
22