W. R. GRACE & CO. V. RUBBER WORKERS, 461 U. S. 757 (1983)

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U.S. Supreme Court

W. R. Grace & Co. v. Rubber Workers, 461 U.S. 757 (1983)

W. R. Grace & Co. v. Local Union 759, International Union of

Rubber, Cork, Linoleum & Plastic Workers of America

No. 81-1314

Argued February 28, 1983

Decided May 31, 1983

461 U.S. 757


Faced with the prospect of liability for violations of Title VII of the Civil Rights Act of 1964 in its hiring practices, petitioner employer signed with the Equal Employment Opportunity Commission (EEOC) a conciliation agreement that conflicted with the seniority provisions of petitioner's existing collective bargaining agreement with respondent union. Petitioner sued in Federal District Court to enjoin arbitration of certain employee grievances under the collective bargaining agreement. The District Court held that the conciliation agreement should prevail with respect to layoffs of employees in conflict with the seniority provisions of the collective bargaining agreement. The Court of Appeals reversed and compelled petitioner to arbitrate. Among the grievances arbitrated were those of two employees who had been laid off pursuant to the conciliation agreement and in violation of the collective bargaining agreement. The arbitrator awarded backpay damages against petitioner under the collective bargaining agreement, interpreting that agreement as not requiring him to follow a contrary prior arbitration award involving the same contractual issue, as providing that the District Court's order did not extinguish petitioner's liability for its breach, and as not providing a good faith defense to claims of violation of its seniority provisions. Petitioner then brought an action to overturn the award, and the District Court entered summary judgment for petitioner, finding that public policy prevented enforcement of the collective bargaining agreement during the period prior to the Court of Appeals' reversal in the prior action. The Court of Appeals reversed.

Held: The award in question is properly to be enforced. Pp. 461 U. S. 764-772.

(a) A federal court may not overrule an arbitrator's decision simply because the court believes its own interpretation of the collective bargaining agreement would be the better one. Thus, here, regardless of what this Court's view might be of the correctness of the arbitrator's contractual interpretation, petitioner and respondent bargained for that interpretation, and a federal court may not second-guess it. The arbitrator's analysis of the merits of the grievance is entitled to the same deference. Pp. 461 U. S. 764-766.

Page 461 U. S. 758

(b) Enforcement of the collective bargaining agreement as interpreted by the arbitrator will not compromise the public policy requiring obedience to a court order. Even assuming that the District Court's order that the conciliation agreement should prevail was a mandatory injunction, nothing in the collective bargaining agreement as interpreted by the arbitrator required petitioner to violate that order. The arbitrator's award neither mandated layoffs nor required that layoffs be conducted according to the collective bargaining agreement, but simply held retrospectively that the employees were entitled to damages for the prior breach of the seniority provisions. Petitioner was cornered by its own actions, and cannot now argue that liability under the collective bargaining agreement violates public policy. No public policy is violated by holding petitioner to its collective bargaining agreement obligations, which bar petitioner's attempted reallocation to union members of the burden of the losses resulting from petitioner's employment discrimination. Pp. 461 U. S. 766-770.

(c) Nor will enforcement of the arbitrator's award inappropriately affect the public policy favoring voluntary compliance with Title VII. Although petitioner and the EEOC agreed to nullify the collective bargaining agreement's seniority provisions, the conciliation process did not include respondent. Absent a judicial determination, the EEOC, not to mention petitioner, cannot alter the collective bargaining agreement without respondent's consent. Pp. 461 U. S. 770-772.

652 F.2d 1248, affirmed.

BLACKMUN, J., delivered the opinion for a unanimous Court.

Page 461 U. S. 759

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