The real power of unions - to hurt their members??

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With all the talk in last class about the UAW and the debate about how their power has influenced the industry, I came across the above article about a case the Supreme Court is hearing a case that resulted from a union’s refusal to use its power to influence an industry.

The case, 14 Penn Plaza v. Pyett, centers on the re-assignment of older security guards from visible, less-physical jobs to less-prestigious, more demanding positions. These security guards then complained to their local union, citing that “… Temco and the building owners, Pennsylvania Building and 14 Penn Plaza, violated the collective bargaining agreement by reassigning them to other jobs. They also alleged the reassignments violated the provision of the agreement prohibiting age discrimination.”

Perhaps in non-union fashion, the employees’ claims of discrimination were actually denied by the union. The men then sued at their own will, and, in response, the defendants moved for arbitration in lieu of litigation (as they cited that the collective bargaining agreement provides such claims must be resolved through arbitration, which already happened). Both a federal judge and a Court of Appeals denied the motion.

The article sums the issue up nicely by saying, “the employer and building owners phrase the question before the [Supreme] court as whether the arbitration clause of a collective bargaining agreement, "freely negotiated by a union and an employer," is enforceable. The employees, on the other hand, phrase the question before the court as whether an arbitration agreement between a union and an employer preclude an employee from filing a lawsuit under the Age Discrimination in Employment Act of 1967 when the union refuses to pursue the claim in arbitration.”

There appear to be two conflicting precedent opinions: Gilmer v. Interstate/Johnson Lane Corp, which effectively said that submitting an age discrimination claim to arbitration isn’t a violation of the collective bargaining agreement; and Rogers v. New York University, which said that such submissions are not enforceable (citing another case, Alexander v. Gardner Denver Co.). There seems to be some controversy over whether the opinion in the Gardner Denver case is “dead” due to the opinion rendered in Gilmer (which is essentially what the defendant is arguing), but given that is was cited in cases earlier in 2008, the answer seems unclear.  It will be interesting to see how the upcoming SC proceedings play out – there seem to be many factors at play here (in addition to conflicting historical actions) such as the more favorable view of arbitration today than in previous decades and whether the union was looking out for the plaintiff’s best interest when it denied their claim or its own.