Melena v. Anheuser-Busch, Inc.

• Decision Date: 23 March 2006
• Docket Number: No. 99421.,99421.
• Citation: 847 N.E.2d 99,219 Ill.2d 135
• Parties: Joann MELENA, Appellee, v. ANHEUSER-BUSCH, INC., Appellant.
• Court: Illinois Supreme Court

847 N.E.2d 99

219 Ill.2d 135

Joann MELENA, Appellee, v. ANHEUSER-BUSCH, INC., Appellant.

No. 99421.

Supreme Court of Illinois.

March 23, 2006.

Joseph J. Torres, Megan Glunz Horton, Andrew Malahowski, of Winston & Strawn, L.L.P., Chicago, for appellant.

Gary L. Bement, of Bement & Stubblefield, P.C., Belleville, and John Vail, of Washington, D.C., for appellee.

Adam C. Wit, of Littler Mendelson, P.C., Chicago, for amicus curiae Ralph's Grocery Company.

Aaron B. Maduff, Deanne S. Medina, of Maduff, Medina & Maduff, Chicago, Thomas W. Osborne, Washington, D.C., Cliff Palefsky, Keith Ehrman, of McGuinn Hillsman & Palefsky, Marissa M. Tirona, all of San Francisco, California, for amici curiae National Employment Lawyers Association et al.

Bruce R. Pfaff, of Pfaff & Gill, Ltd., Chicago, for amicus curiae Illinois Trial Lawyers Association.

David S. Schwartz, Madison, Wisconsin, amicus curiae pro se.

Justice FREEMAN delivered the judgment of the court, with opinion:

This case arises from a complaint filed by plaintiff, Joann Melena, alleging that her employer, defendant Anheuser-Busch, Inc., terminated her employment in retaliation for her filing of a workers' compensation claim with the Illinois Industrial Commission. The circuit court of Jefferson County denied Anheuser-Busch's motion to dismiss and compel arbitration or, in the alternative, to stay the proceedings and compel arbitration. The appellate court affirmed the circuit court's order and remanded the matter for further proceedings. 352 Ill.App.3d 699, 287 Ill.Dec. 859, 816 N.E.2d 826. We granted leave to appeal (177 Ill.2d R. 315) and now reverse the judgment of the appellate court.

BACKGROUND

Plaintiff joined Anheuser-Busch as a nonunion employee at its distribution center in Mt. Vernon, Illinois, on February 22, 1999. In February 2000, Anheuser-Busch mailed to all of its Mt. Vernon employees, including plaintiff, a letter which announced the impending implementation of a "Dispute Resolution Program." Attached to the letter were materials describing the new program, including a "Dispute Resolution Program Guide," "Dispute Resolution Program Highlights," and the "Dispute Resolution Program Policy Statement."

The various materials explained the new program. For example, the policy statement set forth:

"This procedure is an agreement to arbitrate pursuant to the Federal Arbitration Act, 9 U.S.C.A. Sections 1-14, or if that Act is held to be inapplicable for any reason, the arbitration law in the state in which the arbitration hearing is held."

The concept of binding arbitration was described in the following manner:

"At the binding arbitration level, disputes that cannot be resolved through Level 1 * * * or Level 2 * * * are presented to a neutral third-party arbitrator for a final and binding decision. The arbitrator essentially substitutes for a judge and jury who might decide the case in a court setting. At the arbitration hearing, the arbitrator makes a decision after both sides have presented their positions. If the arbitrator decides in favor of the employee, the arbitrator can award the same remedies that would have been available in court for the type of claim that was brought."

The policy statement further explained that "by continuing or accepting an offer of employment" with Anheuser-Busch, all employees to whom the policy was applicable "agree as a condition of employment to submit all covered claims to the dispute resolution program." The statement defined "covered claims" as "employment-related claims against the company and individual managers acting within the scope of their employment, regarding termination and/or alleged unlawful or illegal conduct on the part of the company * * *." Moreover, the policy made clear that the new procedure did not operate "to change the employment-at-will relationship between the company and its employees."

In addition to the written materials included in the letter, Anheuser-Busch arranged for a brief presentation of the new program to be delivered to Mt. Vernon employees on February 23, 2000, which was to be followed by a question-and-answer session. Anheuser-Busch also placed posters explaining the program throughout its Mt. Vernon facility. The new program became effective on April 1, 2000.

In April 2001, Anheuser-Busch distributed "The Promotional Products Group [PPG] Distribution Center Handbook" to Mt. Vernon employees. This handbook included a description of the dispute resolution program and referenced the written program materials noted above. On April 27, 2001, plaintiff signed the following "Employee Acknowledgment and Understanding":

"I acknowledge that I have received the PPG Mt. Vernon employee handbook. I understand that the information in the handbook represents guidelines only and that the company reserves the right to modify this handbook or amend or terminate any policies, procedures, or employee benefit programs at any time, whether or not described in this handbook. I understand that I am responsible for reading the handbook, familiarizing myself with its contents and adhering to all company policies and procedures, whether set forth in this handbook or elsewhere.

I further understand and acknowledge that this handbook is not a contract of employment or guarantee of employment for any specific duration, express or implied, between me and PPG Mt. Vernon."

On September 11, 2002, plaintiff suffered a work-related injury for which she filed a claim for workers' compensation with the Illinois Industrial Commission. While plaintiff was receiving temporary total disability benefits, Anheuser-Busch terminated her employment on March 14, 2003.

Plaintiff filed a complaint in the circuit court of Jefferson County on May 8, 2003. In the complaint, she alleged that Anheuser-Busch discharged her in retaliation for exercising her rights under the Illinois Workers' Compensation Act. Anheuser-Busch moved to dismiss the complaint and compel arbitration or, in the alternative, to stay the proceedings and compel arbitration. The circuit court denied the motion without comment.

On appeal, the appellate court affirmed the circuit court's order. The appellate court held that, in order to be enforceable, an agreement to arbitrate claims like the one at issue must be entered into knowingly and voluntarily. After considering the facts of this case, the appellate court concluded that a remand was not necessary because "even if the plaintiff entered into the agreement knowingly, she did not do so voluntarily." 352 Ill.App.3d at 707, 287 Ill.Dec. 859, 816 N.E.2d 826. Noting that it had "serious reservations" about whether an agreement to arbitrate, offered as a condition of employment, "is ever voluntary," the court deemed "illusory" whatever choice plaintiff was said to have had in this matter. 352 Ill.App.3d at 707-08, 287 Ill.Dec. 859, 816 N.E.2d 826. The court remanded the cause to the circuit court for further proceedings on the underlying cause for retaliatory discharge.

ANALYSIS

The issue presented in this case is whether the mandatory arbitration provisions of the "Dispute Resolution Program" instituted by Anheuser-Busch constitute an enforceable contract binding on plaintiff. Anheuser-Busch assigns error to the appellate court's holding that the arbitration agreement, to be enforceable, must be entered into knowingly and voluntarily. Rather, Anheuser-Busch contends that, like any other contract, an arbitration agreement is enforceable, based on fundamental principles of contract law. Plaintiff, urging affirmance of the appellate court, contends that the arbitration agreement was not enforceable because she did not enter into the contract knowingly and voluntarily.¹

Anheuser-Busch filed its motion to dismiss and compel arbitration or, in the alternative, to stay the proceedings and compel arbitration, pursuant to section 2-619 of the Code of Civil Procedure. (735 ILCS 5/2-619 (West 2000)). In ruling on such a motion, the court must interpret all pleadings and supporting documents in the light most favorable to the nonmoving party. Borowiec v. Gateway 2000, Inc., 209 Ill.2d 376, 383, 283 Ill.Dec. 669, 808 N.E.2d 957 (2004), citing In re Chicago Flood Litigation, 176 Ill.2d 179, 189, 223 Ill.Dec. 532, 680 N.E.2d 265 (1997). The standard of review on appeal is de novo. Borowiec, 209 Ill.2d at 383, 283 Ill.Dec. 669, 808 N.E.2d 957.

The parties do not dispute that resolution of this case concerns the application of the Federal Arbitration Act (FAA) (9 U.S.C. § 1 et seq. (1994)). In construing a federal statute, we generally look to federal decisions for its interpretation of the statutory provisions. U. S. Bank National Ass'n v. Clark, 216 Ill.2d 334, 352, 297 Ill.Dec. 294, 837 N.E.2d 74 (2005); Wilson v. Norfolk & Western Ry. Co., 187 Ill.2d 369, 383, 240 Ill.Dec. 691, 718 N.E.2d 172 (1999). This court, in Borowiec v. Gateway 2000, Inc., 209 Ill.2d 376, 283 Ill.Dec. 669, 808 N.E.2d 957 (2004), discussed the history and purpose of the FAA, acknowledging that in enacting the FAA, Congress sought "`to reverse the longstanding judicial hostility to arbitration agreements that had existed at English common law and had been adopted by American courts, and to place arbitration agreements upon the same footing as other contracts.'" Borowiec, 209 Ill.2d at 384, 283 Ill.Dec. 669, 808 N.E.2d 957, quoting Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 24, 111 S.Ct. 1647, 1651, 114 L.Ed.2d 26, 36 (1991). Section 2 of the FAA compels judicial enforcement of arbitration agreements "in any * * * contract evidencing a transaction involving commerce." 9 U.S.C. § 2 (1994). The United States Supreme Court has held that employment contracts are subject to the terms of the FAA except for those employment contracts which deal with transportation workers. Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 121 S.Ct. 1302, 149 L.Ed.2d 234 (2001). Section 2 further provides that such a written...