U.S. Supreme Court Upholds Employer’s Right to Compel Arbitration of Age Discrimination Claims
By Anthony J. Oncidi and Jeremy M. Mittman
Proskauer Rose LLP
In an important and far-reaching opinion, the U.S. Supreme Court has ruled that a collective bargaining agreement (“CBA”) that requires employees who are union members to arbitrate (rather than litigate) claims arising under the Age Discrimination in Employment Act (“ADEA”) is enforceable as a matter of federal law.
The high court’s decision validates the right of an employer and a union to agree to the manner in which employment disputes are to be resolved, even when those disputes involve individual statutory rights that are unrelated to the union contract itself. Accordingly, the decision is significant to all U.S. employers that have collective bargaining agreements with their employees.
The lawsuit was filed in federal court by three employees who alleged that they had been demoted due to their age – the ADEA protects workers who are age 40 and older. After the union declined to pursue grievances on their behalf under the CBA, the employees filed a lawsuit in federal court. While the lower courts denied the employer’s motion to compel arbitration, the U.S. Supreme Court, in a 5-4 decision, reversed the lower courts and held there is nothing in the ADEA that precludes the arbitration of age discrimination claims where the union and the employer have agreed that such claims would be subject to arbitration rather than litigation.
As a result of the Court’s ruling, and absent any intervening legislation (which already is pending in the U.S. Senate), employers in the U.S. with unionized workplaces should consider bargaining with the union over provisions requiring the arbitration of statutory discrimination claims. In negotiating and drafting such clauses, employers should consult with counsel in order to make sure they are using clear and unmistakable language that specifically identifies the types of claims to be arbitrated, while ensuring that all substantive statutory rights possessed by the employees are preserved. The employer in this case, 14 Penn Plaza LLC v. Pyett, 129 S. Ct. 1456 (2009), was represented by Proskauer Rose LLP.
