Labor & Employment Law

SCOTUS: Court, not arbitrator, decides CBA's ratification date; new cause of action for tortious interference rejected

Today's US Supreme Court decision in Granite Rock Co v. Teamsters (US Supreme Ct 06/24/2010)

The employer sued a local union and an international union under Labor Management Relations Act Section 301(a) claiming that (1) the local union breached a collective bargaining agreement (CBA) by going on strike, and (2) the international union tortiously interfered with the CBA. The employer and the local union had reached a tentative new CBA which contained a broad arbitration clause and a no-strike clause. The employer alleged that the local union had ratified the CBA and then engaged in a strike which was in part led by a high official of the international union. The union claimed that the new CBA had not yet been ratified, so there could be no breach of the no-strike clause.

(1) The issue on the contract claim was whether the ratification date dispute should be decided by an arbitrator or by the district court. The US Supreme Court (7-2) held that the ratification date dispute must be decided by the court. It is typically for a court rather than an arbitrator to decide whether parties have agreed to arbitrate a particular dispute. Here, the district court must decide (a) when the CBA was formed and (b) whether the CBA's arbitration clause covers the dispute the local union wishes to arbitrate.

(2) The Supreme Court unanimously refused to recognize a new federal common-law cause of action under LMRA Section 301 for the international union's alleged tortious interference with the CBA.

Full post as published by Ross' Employment Law Blog on June 24, 2010 (boomark / email).