The Legal Frameworks for Arbitration
Today a variety of federal and state laws apply to arbitration between employers and unions (“labor arbitration”) and to arbitration between employers and individual employees (“employment arbitration”).
Industries in Interstate Commerce
The Labor Management Relations Act (LMRA) of 1947 (the Taft-Hartley Act), 29 U.S. Code §§ 141-67, 171-97 (2012), which amended and incorporated the original National Labor Relations Act (NLRA) of 1935 (the Wagner Act), governs union-management labor arbitration in most segments of interstate commerce in the private sector. Excluded from coverage, however, are agricultural, domestic (household), and public employment, both federal and state. In the federal service, Title VII of the Civil Service Reform Act of 1978, 5 U.S. Code §§ 7101-35 (2012), authorizes arbitration of interest (new contract) disputes and mandates arbitration of grievances under existing contracts between federal agencies and the unions representing their employees.
The Railway Labor Act (RLA) of 1926, as amended, 45 U.S. Code §§151-88 (2012), governs union-management labor arbitration in the railroad and airline industries. So-called “major disputes” over new contract terms are resolved by the National Mediation Board if both the union and the employer carrier concur. So-called “minor disputes,” that is, grievances over applications of the terms of existing contracts, are resolved in the rail industry by the National Railroad Adjustment Board or a subsidiary system adjustment board if either the union or the employer seeks arbitration. The airlines have individual adjustment boards instead of a national board to handle such grievances.
Purely Intrastate Commerce and State Employees
Labor arbitration between unions and small businesses engaged in purely intrastate commerce and arbitration for state and municipal employees in the states are governed by state law. Many states now have statutory procedures covering arbitration for unions of state and municipal employees.
Individual, Nonunion Employees
Enforcement of contracts of employment of individual, nonunion employees is generally covered by state law, not federal law, but the Federal Arbitration Act applies to prevent state law from imposing any special limits on the enforcement of arbitration agreements that are not applicable to other contracts. See, e.g., Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 25-26, 35 (1991); Circuit City Stores, Inc. v. Adams, 532 U.S. 105 (2001). Compare AT&T Mobility, LLC v. Concepcion, 563 U.S. 321 (2011). [Insert link to Barry Winograd’s article.]