The Courts and Arbitration of EEO
Disputes
• Initial Judicial Hostility toward Arbitration
Has Given Way to Acceptance:
– Federal Arbitration Act: Legislative Policy
Encouraging Private Arbitration
Agreements
– Gilmer v. Interstate/Johnson Lane Corp.,
500 U.S. 1 (1991): Individual Arbitration
Agreements for Employment Disputes Are
Legally Enforceable
– Circuit City Stores, Inc. v. Adams, 532 U.S.
105 (2001): Employees Can Be Required to
“Agree” to Arbitrate Disputes as a
Condition of Employment
The Courts and Arbitration of EEO
Disputes (Cont.)
• Supreme Court held that arbitration clause in
collective agreement specifically including EEO claims
requires arbitration of ADEA claim – 14 Penn Plaza
LLC v. Pyett, (2009)
– 14 Penn Plaza overruled Alexander v. GardnerDenver Co., 415 U.S. 36 (1974) -- Alexander held
that grievance arbitration under collective
agreement did not preclude individual Title VII suit
to vindicate statutory rights
– But 14 Penn Plaza decision left open the question of
whether employees must arbitrate EEO claims when
union controls access to arbitration
– “Tension Between Collective and Individual Rights”
EEOC v. Waffle House, 534 U.S. 279
(2002)
• U.S. Supreme Court Holds Individual Agreement to
Arbitrate Does Not Preclude EEOC Enforcement
Action on Behalf of Individual Employee
– EEOC Protects Public Interest by Litigating
– Individual Arbitration Agreement Can Only Affect
Private Rights
• Consistent with Alexander v. Gardner-Denver: EEOC
Seeks to Vindicate Public Interest While Individual
Agreement Addresses Private Interest
Court Review of Arbitration
Procedures
• Armendariz v. Foundation Health Psychcare Services,
Inc., 24 Cal.4th 83 (Cal. Sup. Ct. 2000)
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Neutral Arbitrator
Provide Discovery Process
Written Decision for Award
Remedies Similar to Statutory Remedies
No Unreasonable Fees for Employees
• Costs of Arbitration
– Green Tree Fin. Corp. v. Randolph, 531 U.S. 79 (2000): party
seeking to invalidate arb. agt. because of costs has burden of
demonstrating likelihood of incurring such costs
– Morrison v. Circuit City Stores, 371 F.3d 646 (6th Cir. 2003):
fee-splitting agt. unreasonable and unenforceable if it would
deter substantial number of potential claimants from exerting
their statutory rights