A Funny Thing Happened on the Way to the (Alternative) Forum: Reexamining Alexander V. Gardner-Denver in the Wake of Gilmer V. Interstate/Johnson Lane Corp

Article excerpt

Sarah Rudolph Cole*

I. INTRODUCTION

In its landmark 1991 decision in Gilmer v. Interstate/Johnson Lane Corporation,1 the Supreme Court held that a predispute agreement to arbitrate statutory claims contained in a securities representative's registration application was enforceable.2 This decision triggered an exponential increase in the use of arbitration agreements3 as employers interpreted Gilmer to authorize the insertion of such agreements into contracts with existing employees and prospective hires.4 Employers have embraced these agreements, hoping that arbitration will deliver what it promises: inexpensive and speedy decisionmaking, finality, and confidentiality.5 Moreover, many employers are convinced that together with providing a more expeditious, less expensive system of justice, arbitration will improve their bottom line by lowering potential damage awards.6 Employers' enthusiasm for the perceived benefits of inserting arbitration clauses into employment agreements, together with the judicial approval of these clauses,7 ensures the continued use of such agreements in the nonunionized workplace.8

A certain inevitability surrounded the emergence of arbitration as a preferred method for resolving employment disputes in the nonunionized sector. After all, arbitration had long been the preferred means for resolving employment disputes in the unionized workplace.9 Perhaps it was the extraordinary success of arbitration in resolving disputes in the unionized sector that precipitated nonunionized employers' adoption of arbitration to resolve their own ever-increasing number of employment disputes. Whatever the reason for its increased use, arbitration of employment disputes in the nonunionized sector is here to stay.

Although arbitration originated in organized labor and commercial settings, in at least one respect, nonunionized arbitration has developed more rapidly than arbitration in the unionized sector.lo While Gilmer approved the use of predispute agreements to arbitrate discrimination claims in the nonunionized workplace, the use of such agreements is not permitted in the unionized world because of the 1974 Supreme Court decision in Alexander v. Gardner-Denver. 11 In GardnerDenver, the issue was whether an unionized employee, who, as required by his union's collective bargaining agreement, had submitted his claim under the agreement's nondiscrimination clause to final arbitration, retained the right to bring a Title VII claim in federal court following the arbitration. The Court determined that an unionized employee's right to a trial de novo on a Title VII claim is not precluded by prior submission of a claim to arbitration under a collective bargaining agreement's nondiscrimination clause.12

The continued viability of Gardner-Denver following Gilmer remains an open question, at least in cases where the parties expressly agree to abide by antidiscrimination laws. Gilmer superficially addressed Gardner-Denver's continuing validity in response to Gilmer's argument that statutory claims could not be the subject of a predispute arbitration agreement.13 While the Court concluded that Gilmer's reliance on Gardner-Denver was misplaced,l4 its willing acceptance of arbitration as a method for resolving statutory claims in the employment context seemed to cry for a re-evaluation of Gardner-Denver that the Court failed to provide. Thus, the question remained: what effect does the Gilmer decision have, if any, on the enforceability of predispute arbitration agreements between unions and employers?

Some commentators have suggested that Gilmer does not provide an opportunity for revisiting Gardner-Denver.l5 Yet at least one circuit court and several district courts have used Gilmer as the basis for enforcing an agreement to arbitrate statutory claims in a collective bargaining context.ls Rejecting the continued application of Gardner-Denver, the Fourth Circuit in Austin v. Owens-Brockway Glass Container, Inc. …