Originally from Employment Arbitration - 2nd Edition

Minority Judicial Positions

(i) An Aggressive Interpretation of Gilmer

Austin is a significant case in the development of the caselaw on employment arbitration because the U.S. Court of Appeals for the Fourth Circuit concludes in its opinion that Gilmer (supra) actually overrules Gardner-Denver (supra). The court, in fact, describes Gardner-Denver as the “old law.” The U.S. Supreme Court’s later decision in Wright caused the Fourth Circuit to moderate its position somewhat—especially on the question of the requirements for an effective waiver of judicial remedies for the vindication of statutory rights. The court, however, was the first U.S. court of appeals to rule aggressively in the direction of having the holding in Gilmer replace the ruling in Gardner-Denver.

Two basic issues dominate the opinion: first, whether the provision for grievance-arbitration in a collective bargaining agreement (CBA) is enforceable in the circumstances of the case; and, second, whether statutory claims are arbitrable. As to the agreement for collectivebargaining arbitration, the court makes clear that the plaintiff is compelled by the agreement for mandatory arbitration. There is no discussion of a “second bite at the apple” or the right to ignore the obligation to arbitrate in a regard to certain rights. The contract is a valid agreement that requires enforcement. Moreover, the statutory rights at issue do not prevent the reference to arbitration. Following the reasoning in Gilmer, the court of appeals states that arbitration is merely a form of trial and its use does not diminish the rights in question. The court discusses the divergence between Gilmer and Gardner-Denver on this matter and rejects the position advanced by Gardner-Denver.