Opinion ID: 2464549
Heading Depth: 5
Heading Rank: 1

Heading: The U.S. Supreme Court's articulation of the public policy exception to arbitration awards

Text: The U.S. Supreme Court first recognized the applicability of the public policy exception to the enforcement of arbitration awards in W.R. Grace & Co. v. Local Union 759. [11] In that case, the Court imported the public policy exception from general contract law. As with any contract, the Court stated, a court may not enforce a collective bargaining agreement that is contrary to public policy. [12] If the enforcement of an arbitrator's interpretation of a contract violates some explicit public policy, we are obliged to refrain from enforcing it. [13] Such a public policy, however, must be well defined and dominant, and is to be ascertained `by reference to the laws and legal precedents and not from general considerations of supposed public interests.' [14] The U.S. Supreme Court reaffirmed this approach in a 2000 decision upholding an arbitrator's reinstatement of an employee who failed a drug test. [15] Quoting from W.R. Grace & Co., the Court concluded: We cannot find in . . . any . . . law or legal precedent an `explicit,' `well defined,' `dominant' public policy to which the arbitrator's decision `runs contrary.' [16] The Court also clarified that [i]n considering this claim, we must assume that the collective-bargaining agreement itself calls for [the employee's] reinstatement, [17] because both employer and union have granted to the arbitrator the authority to interpret the meaning of their contract's language. . . . They have `bargained for' the `arbitrator's construction' of their agreement. [18]