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. e du/thir dc ir c uit_1998/226Filed September 10, 1998

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 97-7282

INDEPENDENT ASSOCIATION OF CONTINENTAL PILOTS

v.

CONTINENTAL AIRLINES, a Delaware Corporation

Independent Association of Continental Pilots ("IACP"),

Appellant

On Appeal from the United States District Court

for the District of Delaware

D.C. Civil No. 96-cv-00389

Argued: January 22, 1998

Before: BECKER, Chief Judge, STAPLETON, Circuit Ju dge and POLLAK, District Judge*

(Filed: September 10, 1998)

Roland P. Wilder, Jr. (argued) Christy Concannon Baptiste & Wilder, P.C. 1150 Connecticut Avenue, N.W.

Suite 500 Washington, DC 20036

Attorneys for Appellant

___________________________________________________ ______________

* Honorable Louis H. Pollak, United States District Judge for the Eastern District of Pennsylvania, sitting by designation.Jon A. Geier (argued)

Margaret H. Spurlin Paul, Hastings, Janofsky &

Walker LLP 1299 Pennsylvania Avenue, N.W.

10th Floor Washington, DC 20004-2400

Josy W. Ingersoll

Laura D. Jones Robert S. Brady Young, Conaway, Stargatt & Taylor Rodney Square North, 11th Floor

P.O. Box 391 Wilmington, DE 19899

Margaret Coullard Phillips Continental Airlines, Inc.

Post Office Box 4607 Houston, Texas 77210-4607

Attorneys for Appellees

OPINION OF THE COURT

POLLAK, District Judge.

This appeal concerns the allocation of authority be tween judicial and arbitral tribunals under the Railway L abor Act, 45 U.S.C. S 151 et seq. The International Associati on of Continental Pilots (IACP) brought this action again st Continental Airlines, Inc. ("Continental") in the D istrict Court for the District of Delaware, seeking a decla ration and order directing that (1) Continental was requir ed to arbitrate the merits of an issue assertedly raised in an employee's grievance, and (2) the grievance should be

submitted to the arbitral tribunal on a class-wide basis. Continental counterclaimed, seeking an order direct ing that

the arbitral tribunal determine the issues the IACP sought determination of by the district court. Thereafter Continental moved for judgment on the pleadings. Th at motion was granted and the case was dismissed. The IACP

2has appealed the district court's order granting ju dgment

on the pleadings. For the reasons set forth below, we affirm.

I.

We rehearse the facts as set forth in IACP's compla int and brief on appeal. In 1992, after Continental fil ed its second petition for protection under Chapter 11 of the bankruptcy code, the airline froze, and then sought to reduce, the pay of its pilots. In response to the a irline's announcement of its intent to reduce pilots' pay, a group of pilots undertook negotiations with the airline's management; these talks resulted in a written agree ment, the "Cost Reduction Memorandum" ("CRM"). Paragraph 6(A) of the CRM made provision for the phased restoratio n, according to an agreed-upon formula, of any reducti on in pilot pay:

The wage reductions (i.e. fuel bonus, line d ivisor, training, per diem, and crew meals) . . . wi ll be restored progressively by Continental, in accordance with the formula set forth in Attachment A, with full restoration projected by July 1, 1993. As part of the re storation, the program of quarterly fuel bonus payments to pilots shall end, and in lieu thereof pilots rates of pay progressively restored shall be . . . the Ap ril 1, 1992 rates of pay.

Paragraph 6(B) of the CRM (the so-called "me-too" provision) provided that, until the pilots' pay was restored according to paragraph 6(A), if the airline granted a raise to any employee group other than the pilots, the pilot s would receive a comparable wage increase:

Should Continental grant a wage or salary in crease to any employee group, including management and executive employees, prior to restoration of pilot wage reductions, then the company shall at the sa me time restore pilot wages on a comparable basis.

In late 1993, after the airline and the pilots' gro up entered into this agreement, the IACP was certified as the bargaining unit for the pilots. The CRM continued t o be operative until Continental and the IACP executed t heir first collective bargaining agreement.

3After the IACP was certified as the pilots' bargain ing

representative, the airline and the union entered i nto an agreement entitled the "Interim Grievance Procedure " ("IGP") pending the completion of the parties'first collective bargaining agreement. In accordance with S 204 of t he Railway Labor Act, 45 U.S.C. S 184, the IGP establi shed a system board of adjustment ("System Board") for the arbitration of grievances.1 The grievance procedure contemplated by the IGP consisted of two preliminar y stages--denominated as "Step I" and "Step II" heari ngs-- followed by appeal to the system board of adjustmen t of any grievance not resolved in the first two stages.

On September 9, 1994--after implementation of the I GP

but before the effective date of the first collecti ve bargaining agreement--pilot Jackson Martin filed a grievance s tating:

The Cost Reduction Memorandum establishes th at fuel bonus will be restored, it establishes a pro tocol for the use of a higher hourly rate in lieu of quart erly fuel bonus payments and it defines Continental's total liability toward restoration of pilot wage r eductions to April 1, 1992 pay rates plus the value of th e fuel bonus program. Continental Airlines should honor t he Agreement it reached with its pilots under t he Cost Reduction Memorandum and fully restore pilot wage reductions; to not do so would substantially alter the letter and intent of the current Pilot Emplo yment Policy.

Martin pursued his grievance, unsuccessfully, throu gh the first two steps of the grievance procedure. On Janu ary 4, 1995, Martin filed a notice of appeal to the System Board. On February 8, 1995, the IACP refiled Martin's appe al, stating "herewith is submitted the grievancefiled o n behalf of Jackson Martin and all other similarly situated

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1. Section 204 of the Railway Labor Act is among th e amendments to the statute that extended its coverage to the airline i ndustry. This provision declares that "it shall be the duty of every carrie r and of its employees, acting through their representatives . . . to estab lish a board of adjustment." 45 U.S.C. S 184. A "board of adjustmen t" so established is an arbitral tribunal to which the parties may refer any grievances that

are not otherwise resolved. Id.

4Continental Airlines pilots." The IACP's appeal for mulated

the question at issue as "whether the Company is in

violation of the Cost Reduction Memorandum . . . an d all related provisions for failure to properly enact pi lot pay restoration rate effective July 1, 1994."

Prior to the arbitration hearing, Continental took the position that (1) the IACP could not bring the appe al on behalf of similarly situated pilots, and (2) the Sy stem Board could not entertain the merits of any claim under paragraph 6(B) of the CRM (the "me too" provision) because Martin had not invoked this provision at the earlie r stages of the grievance proceeding. When the arbitration h earing commenced, the IACP announced that it refused to pr oceed unless Continental agreed that any determination ma de by the arbitrator with respect to Martin's waiver of t he "me too" provision or the IACP's right to raise claims for similarly situated pilots would be reviewable de no vo by a

federal court. When Continental refused to make thi s concession, the IACP voiced its intent to go to cou rt to secure a judicial determination of the two issues. The arbitrator thereupon ended the hearing.

The IACP brought suit in the district court, seekin g an order (1) declaring that Continental was required t o arbitrate the issue of whether the airline violated paragraph 6(B) of the CRM, and (2) compelling Continental to accept the System Board's authority to resolve the paragra ph 6(B)

issue on a class-wide basis. Continental countercla imed, seeking an order remanding for arbitration by the S ystem Board the issues IACP sought to have the district c ourt determine. Continental then moved for judgment on t he pleadings, urging that the IACP's complaint sought judicial determination of issues that properly should be add ressed by the System Board as part of its overall arbitrat ion of the Martin grievance as recast by the IACP--the issues the IACP requested judicial determination of being whet her the System Board should entertain the merits of a claim under paragraph 6(B) and whether any relief awarded pursu ant to paragraph 6(B) should inure to all similarly situat ed pilots. In opposition to Continental's motion for judgment on the pleadings, the IACP urged that these were issues of "substantive arbitrability" for the court to decide in advance

5of arbitration. The district court granted Continen tal's

motion for judgment on the pleadings, stating in it s order that "[t]he case is dismissed." IACP then brought t his appeal. Our review of the district court's decision is plenary. Jablonski v. Pan American World Airways In c., 863 F.2d 289, 290 (3d Cir. 1988).

II.

In order to bring the questions posed in this appea l into sharper focus, it may be useful to review the statu tory setting within which these questions arise. The Rai lway Labor Act ("RLA") was enacted in 1926 to provide "a comprehensive framework for the resolution of labor disputes in the railroad industry." Atchison Topeka & Santa Fe Ry. Co. v. Buell, 480 U.S. 557, 562-63 (1987). A mong the "[g]eneral purposes" of the legislation, as set forth in the 1934 amendments to the statute, are "[t]o avoid any interruption to commerce or to the operation of any carrier engaged therein" and "to provide for the prompt and orderly settlement of all disputes growing out of grievance s or out of the interpretation or application of agreements covering rates of pay, rules or working conditions." Act of June 21, 1934, ch. 691 S 2, 48 Stat. 1185, 1186-87 (codified at 45 U.S.C. S 151a). To these ends, the legislation, as amended in 1934, required the establishment of an arbitral tribunal, denominated "the National Railroad Adjustment Board ," for the resolution of such disputes, and authorized car riers and their employees to create "system, group, or re gional boards" for the resolution of such controversies, p rovided that any party dissatisfied with the decision of a subordinate tribunal might still present the grieva nce to the National Board.2 RLA S 3, 45 U.S.C. S 153.

___________________________________________________ ______________

2. The RLA was the product of the joint efforts of labor and industry representatives, who drafted the legislation in an effort to correct the weaknesses of the Transportation Act of 1920, 41 St at. 456, a statute which provided for the establishment of adjustment boards to hear disputes, but did not require the establishment of such boards nor render their awards judicially enforceable. See Int ernational Association of Machinists v. Street, 367 U.S. 740, 758 (1961); Katherine Van Wezel Stone, Labor Relations on the Airlines: The Railway Labor Act in the Era

6In 1936, the RLA was amended to cover the infant ai rline

industry. Act of April 10, 1936, ch. 166, 49 Stat. 1189 (codified at 45 U.S.C. S 181). As amended, all prov isions of the RLA, save S 3, 45 U.S.C. S 153--the provision c reating the National Railroad Adjustment Board--apply to ai rlines and their employees. 45 U.S.C. S 181. In so amendin g the statute, Congress deferred the issue of whether to establish a national adjustment board for the airline industr y, and empowered the National Mediation Board ("NMB") to

determine when the creation of such a board would b e appropriate. 45 U.S.C. S 185. The NMB has not yet m ade

such a determination.

As amended, the RLA directs air carriers and their unions to establish arbitral tribunals--"system, gr oup, or regional boards"--for the resolution of "disputes b etween an employee or group of employees and a carrier or car riers by air growing out of grievances, or out of the interp retation or application of agreements concerning rates of pay, rules, or working conditions." 45 U.S.C. S 184. The statute r equires that such a dispute "be handled in the usual manner up to and including the chief operating officer of the ca rrier designated to handle such disputes; but, in the eve nt of failure to reach an adjustment in this manner, the dispute may be referred by petition of the parties or by ei ther party to an appropriate adjustment board." Id. Consequent ly, until a national adjustment board is created for th e airline industry, a decision rendered by a "system, group o r regional board" is the terminal stop in the pre-jud icial grievance process. Id. Once the appropriate adjustm ent

___________________________________________________ ______________

of Deregulation, 42 Stan. L. Rev. 1485, 1498 (1990) . The 1926 legislation made it the "duty of all carriers, their officers, agents, and employees .

. . to settle all disputes," and mandated the establish ment of system boards for the resolution of disputes. Railway Labor Act, ch. 347 SS 2-3, 44

Stat. 577, 577-78 (1926). But when the requirements of th e 1926 legislation proved to be easily evaded, further labor and manag ement dissatisfaction with the process led to amendments in 1934, strengt hening the disputeresolution provisions of the statute. Act of June 2 1, 1934, ch. 691 S 2, 48 Stat. 1186. The history leading up to the 1934 a mendments is recounted in Elgin, Joliet & Eastern Railway Co. v. Burley, 325 U.S. 711, 725-26 (1945).

7board enters an award, its decision is enforceable in the

federal courts, see International Ass'n of Machinis ts v. Central Airlines, 372 U.S. 682, 685 (1963), and is subject to narrow judicial review. Bower v. Eastern Airlines, 214 F.2d 623, 625 (3d Cir. 1954).

As the foregoing summary makes plain, the RLA's dispute-resolution machinery is central to the stat utory scheme. As set forth in the statute, and elaborated by Supreme Court precedent, the RLA regime governs thr ee different types of disputes: "representation disput es" (disputes concerning the selection of collective-ba rgaining representatives), "major disputes," and "minor disp utes." Depending upon the type of dispute involved, the RL A regime imposes different procedural requirements on the parties and prescribes different dispute-resolution fora.3 This appeal concerns "major disputes" and "minor disputes."

Under the RLA, questions about whether a dispute is subject to arbitration are usually answered with re ference to the distinction between "major" and "minor" disp utes: "minor disputes" are resolved through arbitration ( by the system boards in the case of the airline industry o r by the National Railroad Adjustment Board in the railroad

___________________________________________________ ______________

3. "Representation disputes" are committed to the e xclusive jurisdiction

of the National Mediation Board. 45 U.S.C. S 152 Ni nth; Switchmen's Union v. National Mediation Board, 320 U.S. 297, 30 2 (1943). Major and minor disputes involve, respectively, efforts to se cure and to implement contractual rights; these distinctions will be disc ussed more fully in the text. Further, it should be noted that certain of t he rights and

correlative obligations created by the RLA--particularly the pr ovisions ensuring the free choice of bargaining representatives found in Section 2 of the statute, 45 U.S.C. S 152--are also enforceable in f ederal court. Because the RLA (unlike the National Labor Relations Act) h as not established an administrative body for the enforcement of statutor y rights, certain of

the rights created by the statute are enforceable in th e courts. See, e.g., Virginian Ry. v. System Fed'n No. 40, 300 U.S. 515, 544 (1937)(duty to negotiate judicially enforceable); Texas & New Orle ans Railroad v. Railway & Steamship Clerks, 281 U.S. 548, 567 (1930 )(right to free choice of bargaining representative judicially enfo rceable). Although a leading treatise on the RLA--The Railway Labor Act (Douglas Leslie, ed. 1994)--refers, for analytic purposes, to disputes r aising such issues as "statutory disputes," this label has not caught on in the courts.

8industry) while "major disputes" are subject to a l engthy

process of bargaining and mediation.

The Supreme Court set forth the major/minor framewo rk in Elgin, Joliet & Eastern Railway Co. v. Burley, 3 25 U.S. 711 (1945).4 This classification scheme determines what kind of dispute resolution mechanisms may be brough t to bear on the controversy and also determines the ext ent to which the federal courts may become involved. Assoc iation of Flight Attendants, AFL-CIO v. USAir, Inc., 960 F .2d 345, 348 (3d Cir. 1992).

The "major dispute" category, as the Supreme Court explained in Burley, "relates to disputes over the formation of collective agreements or efforts to secure them. They arise where there is no such agreement or where it is sought to change the terms of one, and therefore th e issue is not whether an existing agreement controls the controversy." 325 U.S. at 723. If the parties are i nvolved in a major dispute, they must bargain over the issue; while bargaining, the parties are required to maintain th e status quo and exhaust the lengthy mediation procedures se t forth in S 6 of the statute, 45 U.S.C. S 156, before they may resort to self-help. Compliance with these requirem ents is

enforceable in the federal courts. Detroit & Toledo Shore Line Railroad v. United Transportation Union, 396 U .S. 142, 149 (1969). If, upon the conclusion of the mediatio n procedures, the parties are at an impasse, they may then employ economic weapons (e.g., strikes or lockouts) . See Burley, 325 U.S. at 725, Consolidated Rail Corp. v. Railway Labor Executives' Ass'n, 491 U.S. 299, 303 (1989).

While the major dispute category concerns efforts t o establish or change the terms of a collective barga ining agreement, the minor dispute category, in the Burle y Court's formulation,

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4. The terms "major" and "minor" are not found with in the RLA. The Supreme Court first used the major/minor typology i n the Burley decision. In doing so, the Court adopted the nomenc lature that had developed within the railroad industry. See 325 U.S . at 723-28. As the Court later clarified in Consolidated Rail Corp. v. Railway Labor Executives' Ass'n, 491 U.S. 299, 305 (1989), the de signations "major" and "minor" are not to be understood as reflecting the relative importance of particular labor controversies.

9contemplates the existence of a collective b argaining

agreement already concluded or, at any rate, a situation in which no effort is made to brin g about a formal change in terms or to create a new on e. The dispute relates either to the meaning or pro per application of a particular provision with r eference to a specific situation or to an omitted case. . . . . [T]he claim is to rights accrued, not merely to ha ve new ones created for the future.

325 U.S. at 723. Minor disputes are subject to mand atory arbitration by the relevant board of adjustment, an d may not be the subject matter of strikes and lockouts.

Jurisdiction to entertain the merits of a minor dis pute rests exclusively with the arbitral forum: "Congress cons idered it essential to keep these so-called `minor' disputes within the Adjustment Board and out of the courts." Union-Paci fic Railroad Co. v. Sheehan, 439 U.S. 89, 94 (1978)(per curiam).

Although the Burley Court established the general contours of the distinction between major and minor disputes, it did not articulate a standard for diff erentiating the two. In Consolidated Rail Corp. v. Railway Labo r Executives' Association, 491 U.S. 299 (1989) ("Conr ail"), the Court undertook to advance the analysis. "[T]he lin e drawn in Burley," said the Conrail Court, "looks to wheth er a claim has been made that the terms of an existing agreeme nt either establish or refute the presence of a right to take the disputed action. The distinguishing feature of [a m inor dispute] is that the dispute may be conclusively re solved by interpreting the existing agreement." Id. at 305. A ccordingly the Court adopted a standard that sought to synthes ize the various verbal formulations adopted by the several courts of appeals that had addressed the issue: "Where an emp loyer asserts a contractual right to take the contested a ction, the ensuing dispute is minor if the action is arguably justified by the terms of the parties' collective-bargaining agreement. Where, in contrast, the employer's claims are frivo lous or obviously insubstantial, the dispute is major." Id. at 307.

III.

In the case at bar, the district court determined t hat the "underlying issues in this case"--Continental's all eged

10violations of paragraphs 6(A) and 6(B) of the CRM--

"constitute minor disputes under the RLA." Slip opi nion at 6. The district court then stated that "although th e RLA requires that minor disputes be settled in arbitrat ion rather than by strikes or by the federal courts, it does n ot prohibit the parties to a collective bargaining agreement fr om setting procedural limits to the system boards' jurisdictio n. Whether the parties have complied with the procedur al requirements of the collective bargaining agreement such that the arbitrator may address the merits of a dis pute is a matter for the arbitrator to decide." Slip opinio n at 8-9 (citation omitted). The district court went on to c onclude that the issues presented in the IACP's complaint " are minor disputes" which "must, therefore be decided t hrough arbitration." Slip opinion at 9.

There is no doubt that, as a general matter, a disp ute over whether Continental violated paragraphs 6(A) a nd 6(B) of the CRM is a minor, rather than major, dispute. And, more particularly, there is no doubt that the issue s posed by the grievance relating to pilot wages filed by J ackson Martin against Continental are issues of the sort t hat are subject to arbitration by the board of adjustment. This appeal focuses on the question whether the IACP's recasting of the Martin grievance into one of broad er scope has introduced additional and antecedent issues tha t should be resolved judicially as a predicate to arb itration or whether those additional issues are themselves subj ect to arbitration. Characterizing these issues as matters of "substantive arbitrability," the IACP contends that they must be resolved by the district court rather than by the board of adjustment.5 In pressing this contention o n appeal, the IACP argues that the issues that it ask ed the district court to resolve prior to arbitration--nam ely, whether the alleged violation of paragraph 6(B) of the CRM is properly before the arbitrator, and whether the 6(B) question must be addressed on a class-wide basis--a re

___________________________________________________ ______________

5. On page 15 of its brief, the IACP attributes to the district court the

statement that "the doctrine of substantive arbitra bility has no application under the RLA." This language, however, appears neither on the page to which the IACP's brief refers nor anywh ere else in the opinion.

11questions of "substantive arbitrability" for the co urt to

decide.

The term "substantive arbitrability" derives from N ational Labor Relations Act jurisprudence but has been util ized in other contexts. It is used to describe the question whether the parties' dispute involves a subject matter that is within the ambit of a contractual arbitration agreement. S ee John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 557 -58 (1964); United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582-83 (1960). The Su preme Court used the term "substantive arbitrability" for the first time in John Wiley, a case arising under the NLRA, to differentiate "substantive" issues--whether the par ties have agreed to arbitrate the subject matter of the dispu te--from "procedural" issues--"whether grievance procedures or some part of them apply to a particular dispute, wh ether such procedures have been followed or excused, or w hether

the unexcused failure to follow them avoids the dut y to arbitrate." 376 U.S. at 557-58. The question of"sub stantive arbitrability"--that is, "whether a collective barg ainingagreement creates a duty for the parties to arbitra te the particular grievance"--is, as the Supreme Court ins tructs, "undeniably an issue for judicial determination." A T & T Technologies, Inc. v. Communications Workers, 475 U .S. 643, 649 (1986). Issues of "procedural arbitrabilit y," on the other hand, are for the arbitrator to decide. John Wiley, 376

U.S. at 558.

Responding to the IACP's contention that its compla int implicates issues of "substantive arbitrability" fo r the court to decide, Continental makes two arguments: Thefirs t argument is that, as the district court ruled, the IACP's complaint presents a minor dispute solely within th e jurisdiction of the board of adjustment. The second argument is that the IACP's complaint raises questi ons not of "substantive arbitrability" but of "procedural arbitrability"--questions which are for the arbitra tor to

decide.

A. Does Continental's Complaint Present a "Minor Dispute"?

In urging the correctness of the district court's determination that the IACP's complaint presents a minor

12dispute, Continental contends that the defenses tha t it

advanced to the Martin grievance and to the IACP's proposed recasting of the grievance are defenses wh ich, to use the terminology of Conrail--"[a] dispute is min or if the action is arguably justified by the terms of the pa rties' collective-bargaining agreement"--are "arguably jus tified" by, respectively, the Cost Reduction Memorandum ("C RM") and the Interim Grievance Procedure ("IGP"). Thus, in Continental's view, we need look no further than th e definition of a minor dispute to resolve this case.

Although the Court's Conrail discussion of minor disputes is pertinent, we are called upon to answer a somewhat different question from that posed by the distinction between major and minor disputes. The f unction that a court performs when determining whether a di spute is major or minor is not the function that a court performs when deciding whether an issue is one of "substanti ve arbitrability" or "procedural arbitrability." As th e Supreme Court has pointed out, the "arguably justified" sta ndard announced in Conrail "was employed only for policin g the line between major and minor disputes." Hawaiian Ai rlines, Inc. v. Norris, 512 U.S. 246, 265 (1994). That line determines which statutory route must be followed a s between (1) bargaining, followed by compulsory medi ation procedures under the auspices of the National Media tion Board, which procedures are judicially enforceable, and (2) binding arbitration, subject to limited judicial re view. Thus, the major/minor question allocates the respective a uthority of the National Mediation Board on the one hand, an d the arbitral boards of adjustment on the other, and als o delineates the judiciary's role in each respective statutory path.6 See Burley, 325 U.S. at 722.

This appeal presents a related, but nonetheless dif ferent, question. It presents the question whether, in the adjudication of a dispute concededly to be decided by an

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6. The definition of a minor dispute also comes int o play when determining whether a state-law claim raised by a w orker covered by a collective bargaining agreement governed by the RLA is preempted. See Hawaiian Airlines, 512 U.S. at 265. But the preempt ion inquiry has no bearing on the case at bar.

13arbitral tribunal (under the RLA, a board of adjust ment), it

is the arbitral tribunal or the court which determi nes the scope of the arbitration. To be more specific, a de cision that the controversy about the adequacy of Continental's pilots' wages is a "minor" dispute sets the stage for a fur ther question: Granted that Jackson Martin's grievance i s arbitrable, are the additional issues posed by Cont inental's objections to the IACP's recasting of the Martin gr ievance matters to be decided by the district court or by t he System

Board?

Hence this appeal concerns not whether this case go es to arbitration (as opposed to another statutory route) , but

instead concerns what issues the arbitral tribunal should

decide and on whose behalf those issues are to be d ecided: the IACP's complaint asks the court to determine (1 ) whether the arbitral tribunal must, in entertaining Martin's grievance, decide whether or not Continental violat ed paragraph 6(B) of the CRM (the "me-too" provision), and (2)

whether the arbitral tribunal must decide that issu e on a class-wide basis. It is the IACP's contention that these questions fall under the rubric of "substantive arb itrability" and thus must be decided by the court. Because this contention is not definitively answered one way or another via the major/minor distinction, we now turn to the question whether the IACP's complaint involves issu es of "substantive" or "procedural" arbitrability.

B. Does the IACP's Complaint Raise Issues of "Substantive" or "Procedural" Arbitrability?

In support of its argument that its complaint raise s questions of "substantive arbitrability," the IACP relies heavily on our discussion in PaineWebber v. Hartman n, 921 F.2d 507, 512-13 (3d Cir. 1990), and PaineWebber, I nc. v. Hofmann, 984 F.2d 1372, 1378 (3d Cir. 1993), two ca ses arising not under the RLA or the NLRA, but under th e securities laws and the Federal Arbitration Act. In Hartmann and Hofmann, securities brokerage houses s ued to enjoin the arbitration of customers' claims of f raud and mismanagement. Both cases concerned contractual language found in the arbitration provisions of the New York Stock Exchange rules and the National Associat ion of Stock Dealers Code of Arbitration Procedure, to wit : "No

14dispute, claim, or controversy shall be eligible fo r

submission to arbitration . . . where six (6) years have elapsed from the occurrence or event giving rise to the act or dispute, claim or controversy." 921 F.2d at 509. Relying on the specific language, absent in the case at bar , relating to disputes "eligible for submission to arbitration ," we held in Hartmann (and reiterated in Hofmann) that the application of the quoted provision was a question of "substantive arbitrability" for the court. 921 F.2d at 513; 984 F.2d at 1379. In Hartmann, however, we specific ally noted the narrowness of our holding, stating that "[l]anguage less distinct than `eligible for submis sion to arbitration' might well be insufficient to overcome the strong jurisprudential pull toward arbitration." 92 1 F.2d at

514.

The IACP urges that the agreement in this case--and in particular the exhaustion requirement of the IGP--p resents

a "substantive bar" to arbitration such that our ru lings in Hartmann and Hofmann apply. The IACP places princip al reliance on language in the "Jurisdiction" portion of Section III of the IGP. The language relied on provides: "T he System Board shall have authority to hear only matters whi ch are within the scope of this Agreement and which have b een handled through the prior steps of this grievance procedure." This is not, however, the only part of the agreement which sets forth exhaustion principles. I n Section IV of the IGP, under the heading "General Provisions," the agreement states in relevant part:

Unless the Company and the grievant or the I ACP mutually agree otherwise, a grievant is prec luded from raising in subsequent steps issues not raise d in his original grievance. Further, the Step II Hea ring Officer and System Board of Adjustment are precluded from considering issues not raised in the grievan t's original grievance unless the Company and the grievan t or the IACP mutually agree otherwise. Such issues m ay only be submitted as new grievances subject to al l time limits, jurisdictional restrictions, and any other pertinent provisions of this Agreement.

We do not find the language of Sections III and IV of the IGP to be as "distinct" as the language at issue in the

15Hartmann and Hofmann cases. The mere fact that the

exhaustion provisions are framed in obligatory term s does not necessarily render the provisions a "substantiv e bar" requiring judicial, rather than arbitral, interpret ation. In Belke v. Merrill Lynch, Pierce, Fenner & Smith, 693 F.2d 1023 (11th Cir. 1982), a case we referred to in Har tmann, the arbitration portion of the agreement between th e investor and the broker read, in pertinent part, "A rbitration must be commenced within one year after the cause o f

action accrued." Id. at 1026 n.4. The Eleventh Circ uit concluded that compliance with this provision was a n issue for the arbitrator to decide. Id. at 1028. Noting t hat the provision at issue in Belke presented a "stark cont rast" with the NYSE and NASD's "eligib[ility] for submission t o arbitration" formulation, we observed in Hartmann t hat the Belke court "quite reasonably" held that"its applic ation should be decided by the arbitrator." 921 F.2d at 5 13-14.

Even if the exhaustion provisions of the IGP could properly be read as approximating the distinctness of the Hartmann/Hofmann "eligible for submission to arbitr ation" provision, we would be slow to conclude that interp retation and application of the exhaustion provisions were m atters

for the district court rather than matters for the System Board. We think the case for judicial circumspectio n in defining the boundaries of the arbitral process is less compelling in the Hartmann/Hofmann setting, where t he disputes to be addressed arise out of the relations hip between a brokerage house and an individual custome r, than in settings governed by a collective bargainin g agreement which covers scores or hundreds or thousa nds or even tens of thousands of employees. In the coll ective bargaining setting, the primacy of the arbitral rol e is crucial to the stability of the work place. The Supreme Cou rt made this plain almost forty years ago in United Steelwo rkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 578 (1960):

Thus, the run of arbitration cases, illustra ted by Wilko v. Swan, 346 U.S. 427 [a securities case], b ecomes irrelevant to our problem. There the choice is between the adjudication of cases or controversies i n courts with established procedures or even special statutory

16safeguards on the one hand and the settlemen t of them

in the more informal arbitration tribunal on the other. In the commercial case, arbitration is the s ubstitute for litigation. Here arbitration is the substitu te for

industrial strife. . . . For arbitration of labor disputes under collective bargaining agreements is pa rt and parcel of the collective bargaining process itself.

Id. at 578.

A recent illustration of the centrality of arbitrat ion in the collective bargaining context is our decision in As sociation of Flight Attendants v. USAir, 960 F.2d 345 (3d Cir . 1992). In Association of Flight Attendants, an RLA case, w e were called upon to decide whether the district court er red in ruling that a particular item of evidence--the grie vant's expunged criminal records--must be admitted in the arbitral proceeding. While finding that this issue could not correctly be characterized as presenting either a m ajor or a minor dispute, we determined that the issue was one of procedure for the arbitrator to decide. Id. at 348- 49.7

In so holding, we found guidance in John Wiley, whi ch held that under the National Labor Relations Act, " [o]nce it is determined . . . that the parties have agreed to submit the subject matter of the dispute to arbitration, ` procedural questions' which grow out of the dispute and bear o n its final disposition should be left to the arbitrator. " Id. at 557. Following the logic of John Wiley, we concluded in Association of Flight Attendants that the general s ubject matter of the dispute--i.e., the termination of the grievant-- was subject to arbitration and that the evidentiary question

was one for the arbitrator to decide.8 960 F.2d 34 9-350.

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7. It bears noting that we decided Association of F light Attendants after

Hartmann.

8. The "procedural arbitrability" doctrine of John Wiley, long a mainstay of NLRA jurisprudence, has been held applicable to RLA cases by other courts of appeals as well. In Brotherhood [of] Rail way Carmen v. Atchison, Topeka & Santa Fe Railway Co., 956 F.2d 156 (7th Ci r. 1992), the court

came to a conclusion similar to the one we reached in Association of Flight Attendants, albeit in a case arising in a di fferent procedural posture. In that case, the union sued on the basis of an arbitral award entered in favor of a discharged employee by an RLA board of

17In the case at bar, the IACP, in its first count fo r relief,

asked the district court to rule that the arbitrato r must

determine the merits of the issue of whether Contin ental violated paragraph 6(B)--an issue which Continental contended, in advance of arbitration, was not previ ously raised in the grievance procedure. Thus the IACP re quested a judicial determination of whether or not any appl icable exhaustion requirement was met (and, if not, whethe r there was ground for excusing exhaustion). In doing so, I ACP raised, in the RLA context, an argument which, in t he NLRA context, the Supreme Court in John Wiley had occasion to reject. In John Wiley, the employer res isted arbitration of an employee's grievance on a number of grounds, one of which concerns us here: the employe r's argument that the court should find arbitration pre cluded because the employee failed to exhaust the prelimin ary steps of the grievance procedure. 376 U.S. at 556 & n.11. Rejecting the employer's argument that it was for t he court to decide the exhaustion issue (as well as the issu e whether the grievance was timely instituted) the Court stat ed:

Doubt whether grievance procedures or some p art of them apply to a particular dispute, whether such

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adjustment. On appeal, the issue was whether the di strict court erred in ruling, in the first instance, that the employer "h ad waived its right to oppose the full award" because it failed to introdu ce the evidence that supported its opposition during arbitration. Id. at 158. The court held that the interpretation of the contractual provisio n relating to the manner in which grievances were to be presented to the arbitrators--

"each written submission shall be limited to the ma terial submitted by the parties to the dispute [in the earlier stages o f the grievance proceeding]"--was a procedural question for the arb itrators to decide. Id. at 158, 159. In doing so, the court pointed out tha t it is "customary for collective bargaining agreements to require the exh austion of the preliminary stages of the grievance procedure befor e resorting to arbitration . . . for why establish remedies if the parties are free to bypass them?" Id. at 158. And in Larsen v. American Airlines, Inc., 313 F.2d 599 (2d Cir. 1963), the court noted "[W]here a labor agreement provides for arbitration or other internal resoluti on of disputes, this court has held that questions of `procedural arbitr ability' are for the arbitrator" (citing Livingston v. John Wiley & Sons , Inc., 313 F.2d 52 (2d Cir. 1963), subsequently affirmed as John Wiley & S ons, Inc. v. Livingston, 376 U.S. 543 (1964)).

18procedures have been followed or excused, or whether

the unexcused failure to follow them avoids the duty to arbitrate cannot ordinarily be answered with out consideration of the merits of the dispute w hich is presented for arbitration. . . . . It would be a curious rule which required that intertwined issues of "substance" and "procedure" growing out of a single dispute and raising the same questions on th e same facts had to be carved up between two differ ent forums, one deciding after the other. Neithe r logic nor considerations of policy compel such a resul t.

376 U.S. at 557. We find this reasoning and result fully applicable to the case at bar.

The second issue raised in IACP's complaint, whethe r the arbitrator must entertain the Martin grievance on b ehalf of all pilots, is likewise an issue for the arbitrator to decide. This issue is not only "procedural" in nature, but also requires considerable investigation into the meanin g of the parties' agreements. The IACP in effect requests th at the court certify the grievance as a class action befor e the arbitrator proceeds to hear the case, a proposed pa rtyjoinder ruling that would be "procedural" as that t erm is normally understood. Furthermore, resolving this is sue would involve an analysis of the interplay between the CRM's wage-restoration provision--paragraph 6(A)--a nd the "me too" provision--paragraph 6(B)--on the one hand , and the IGP's provisions governing the conduct of griev ance proceedings on the other. If we were to assume that an arbitrator would find any applicable exhaustion requirement satisfied, then the arbitrator might al so find within the language of the parties' agreements, as elucidated by the law of the shop, a basis for cons idering paragraph 6(B) claims to mandate or permit class-wi de relief (that is to say, perhaps the "me too" clause is better
understood as an "us too" clause). But such a determination requires a much more searching interpretation of the contract than the courts are permitted under the RLA. In this case, as in John Wiley, this procedural issue cannot "be answered without consideration of the merits of the dispute which is presented for arbitration." 376 U.S. at 557.

19The IACP seeks not a determination of the subject m atter

covered by the agreement to arbitrate, but a judici al determination of the parameters and scope of the aw ard that the system board may permissibly enter, that i s, (1) whether the "me-too" clause was properly invoked (a nd if not, whether the union can interpolate this claim a t the arbitral stage), and (2) whether the arbitrator has authority to grant relief on a class-wide basis. In the latte r regard, it bears noting that Section III.B of the IGP contains the following general grant of remedial authority (also under the subheading "Jurisdiction"):

The System Board shall have the authority to issue rulings and make awards necessary to compens ate a pilot for actual damages suffered as a resul t of any policy violations it finds to have occurred. The System Board's jurisdiction to award damages is str ictly limited to actual, compensatory damages, and does not include jurisdiction or authority to award d amages in the nature of a penalty, i.e., punitive dama ges. The Board shall have the authority, however, to order a party to comply with any provision(s) of the [agreement] or policies as necessary to remedy or correc t violations, or to require specific enforcement of a prov ision of the [agreement] or policies.

The interpretation of such remedial provisions is a task for which arbitrators conversant with industry practice are likely to be better suited than judges. Cf. Carey v . General Elec. Co., 315 F.2d 499, 508 (2d Cir. 1963)("We can not divine now, nor do we deem it proper to predict, th e precise

form in which the arbitrator will frame his decree. "), cert. denied, 377 U.S. 908 (1964).

When a court is called on to determine whether aspe cts of a dispute arising out of a collective bargaining agreement are to be determined by an arbitrator or by the cou rt, judicial restraint is an institutional imperative. Excessive judicial intrusion can undermine arbitral expertise and authority.9 Further, lengthy court proceedings can seriously

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9. "It is particularly underscored that the arbitra l process in collective bargaining presupposes that the parties wanted the informed judgment of an arbitrator, precisely for the reason that jud ges cannot provide it." Concurring Opinion of Brennan, J., joined by Frankf urter and Harlan, JJ., in United Steelworkers of America v. American Manufacturing Company, 363 U.S. 564, 570 (1960).

20undermine the capacity for prompt adjudication whic h is

the hallmark of arbitration. As the Court cautioned in John Wiley,

the opportunities for deliberate delay and t he possibility of well-intentioned but no less serious delay created by separation of the "procedural" an d "substantive" elements of a dispute are clea r. . . . [S]uch delay may entirely eliminate the prospect of a speedy arbitrated settlement of the dispute, to the disadvantage of the parties (who, in additio n, will have to bear increased costs) and contrary to the aims of national labor policy.

376 U.S. at 558.10

Accordingly, both of the matters raised by the IACP 's complaint are questions of procedure for the arbitr al

tribunal to decide.

Conclusion

For the foregoing reasons, the judgment of the dist rict

court is affirmed.11

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10. As pointed out in Part II of this opinion, supr a note 1, the RLA's provisions for arbitration by boards of adjustment were drafted in response to the Transportation Act's ineffectual di spute-resolution machinery; but even those procedures established by the original statute proved less than satisfactory. Before the RLA's mec hanisms for resolving grievance and contract-application disputes were st rengthened by the 1934 amendments to the statute, "parties were free at all times to go to court to settle [grievances]" and the intended disp ute-resolution process broke down. Burley, 325 U.S. at 725-26. Consequentl y, the 1934 amendments created a compulsory arbitration system" to remove the settlement of grievances from this stagnating proce ss and bring them within a general and inclusive plan of decision." I d. at 728. Hence it is unsurprising that the 1934 amendments were enacted under the title: "An Act to amend the Railway Labor Act approved May 20, 1926, and to provide for the prompt disposition of disputes betw een carriers and their employees." Act of June 21, 1934, ch. 691, 44 Stat. 577.

11. Continental concluded its brief on appeal with the recital that "the judgment [the judgment of the district court which granted Continental's

21A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

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motion for judgment on the pleadings and recited th at "[t]he case is dismissed"] should be affirmed." Continental has no t asked this court to address the counterclaim it filed prior to moving f or judgment on the pleadings. Whether that counterclaim has any contin uing viability, or (as pointed out in the district court's memorandum opin ion but not in the district court's order) vanished with the district court's grant of judgment on the pleadings and consequent dismissal of the ca se, is not a question

that is before this court. If this matter reaches t he System Board of Adjustment, we presume that the threshold issues be fore the Board will be those identified in Continental's counterclaim, e.g., whether, under the Interim Grievance Procedure, (1) the IACP may b ring a grievance on behalf of "similarly situated" pilots other than th e individual pilot who filed the grievance; (2) a grievant is precluded fr om raising before the System Board an issue not raised in the original gr ievance; and (3) Jackson Martin raised Paragraph 6(B) of the Cost Re duction Memorandum in his original grievance filed on Septe mber 9, 1994.

22