Opinion ID: 1711125
Heading Depth: 1
Heading Rank: 5

Heading: Federal Discrimination Claims

Text: The Court of Appeals relied on Gilmer, supra, in holding that public policy did not prevent the enforcement of a valid prospective arbitration agreement. 207 Mich.App. at 311, 523 N.W.2d 904. In 1991, the Gilmer Court held that a broadly worded arbitration clause in a securities registration form, which is often referred to as a stock broker U-4 form, covered an ADEA claim. In doing so, the Court found that the Federal Arbitration Act (FAA) applied and that it evidenced a `liberal federal policy favoring arbitration agreements.' Id. at 25, 111 S.Ct. at 1651 (citation omitted). However, the FAA expressly excludes from coverage contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce. 9 U.S.C. § 1. [10] Referencing this clause, Gilmer expressly did not decide what the result would be if the arbitration clause had been contained in an employment contract. Id. at 25, n. 2, 111 S.Ct. at 1651, n. 2. Gilmer also distinguished a trilogy of cases that had arisen in the collective bargaining setting: Alexander v. Gardner-Denver Co., 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974) (title VII claim), Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728, 101 S.Ct. 1437, 67 L.Ed.2d 641 (1981) (right to minimum wage claim under the Fair Labor Standards Act), and McDonald v. West Branch, 466 U.S. 284, 104 S.Ct. 1799, 80 L.Ed.2d 302 (1984) (42 U.S.C. § 1983 claim). Following Gilmer, there has been a lot of appellate activity involving the applicability of prospective arbitration agreements to federal discrimination claims. Although there remain many unanswered questions in Gilmer's wake, two general rules have emerged. First, an arbitration clause in a collective bargaining agreement does not extend to federal statutory claims of discrimination. E.g., Pike v. Burlington Northern R Co., 273 Mont. 390, 398, 903 P.2d 1352, 1357 (1995). One overriding rationale for this rule is that civil rights are individual personal rights, while union bargaining representatives act for the benefit of the group. The apparent tension between collective representation and individual statutory rights led the Court in the Alexander line of cases to protect the rights of the individual employee by not enforcing arbitration agreements in collective bargaining agreements with respect to claims of unlawful discrimination. Gilmer, 500 U.S. at 35, 111 S.Ct. at 1656-57. The second rule is that an arbitration clause in a stock broker U-4 form does extend to title VII claims, in addition to ADEA claims. Bender v. AG Edwards & Sons, Inc., 971 F.2d 698 (C.A.11, 1992); Alford v. Dean Witter Reynolds, Inc. (On Remand), 939 F.2d 229 (C.A.5, 1991). The defendant cites numerous cases for the proposition that prospective arbitration agreements in individual employment contracts have been enforced with respect to federal and state discrimination claims. [11] However, those cited cases arose under the FAA or were not ordinary employment contracts. [12] I have found other cases that have distinguished the contract at issue, such as a stock broker U-4 form, as not being an employment contract. Willis v. Dean Witter Reynolds, Inc., 948 F.2d 305, 312 (C.A.6, 1991); Alford, 939 F.2d at 230, n.  ([c]ourts should be mindful of this potential issue in future cases). [13] On the basis of the fact that the Gilmer Court expressly distinguished employment contracts, id. at 25, n. 2, 111 S.Ct. at 1651, n. 2, and because many subsequent cases have continued that distinction, I would find that the cases upholding prospective arbitration agreements in stock broker U-4 forms, including Gilmer, are not on point in the case at hand because they did not concern ordinary employment contracts. [14] Hence, I would find that there remains a conflict among courts regarding whether arbitration agreements in individually negotiated employment contracts are enforceable under the FAA with respect to claims of unlawful discrimination. In any event, the defendant has not argued that the instant case is controlled by the FAA. Therefore, even if prospective arbitration agreements in individually negotiated employment contracts are enforceable with respect to federal and other state discrimination claims when the FAA does apply, such cases would not necessarily apply here. [15]