Pryner v. Tractor Supply Co.

• Decision Date: 20 March 1997
• Docket Number: Nos. 96-2437,96-2892,s. 96-2437
• Citation: 154 L.R.R.M. (BNA) 2806,109 F.3d 354
• Parties: 154 L.R.R.M. (BNA) 2806, 73 Fair Empl.Prac.Cas. (BNA) 615, 71 Empl. Prac. Dec. P 45,016, 65 USLW 2622, 133 Lab.Cas. P 11,833, 20 A.D.D. 689, 9 NDLR P 235 Vincent L. PRYNER, Plaintiff-Appellee, Counterclaim Defendant, v. TRACTOR SUPPLY COMPANY, Defendant-Appellant, Counterclaim Plaintiff. Eugene SOBIERAJSKI, Plaintiff-Appellee, v. THOESEN TRACTOR & EQUIPMENT COMPANY, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 354

109 F.3d 354

154 L.R.R.M. (BNA) 2806, 73 Fair

Empl.Prac.Cas. (BNA) 615,

71 Empl. Prac. Dec. P 45,016, 65 USLW 2622,

133 Lab.Cas. P 11,833, 20 A.D.D. 689,

9 NDLR P 235

Vincent L. PRYNER, Plaintiff-Appellee, Counterclaim Defendant, v. TRACTOR SUPPLY COMPANY, Defendant-Appellant, Counterclaim Plaintiff.

Eugene SOBIERAJSKI, Plaintiff-Appellee, v. THOESEN TRACTOR & EQUIPMENT COMPANY, Defendant-Appellant.

Nos. 96-2437, 96-2892.

United States Court of Appeals, Seventh Circuit.

Argued Dec. 12, 1996.

Decided March 20, 1997.

William R. Groth, Fillenwarth, Dennerline, Groth & Towe, Bobby A. Potters, Indianapolis, IN, Marsha S. Berzon (argued), Altshuler, Berzon, Nussbaum, Berzon & Rubin, San Francisco, CA, for plaintiff-appellee in No. 96-2437.

David L. Swider, Scott A. Weathers, Bose, McKinney & Evans, Indianapolis, IN, Charles W. Pautsch (argued), James B. Sherman, Brian A. Price, Wessels & Pautsch, Milwaukee, WI, for defendant-appellant in No. 96-2437.

Paul Bogas, Equal Employment Opportunity Commission, Office of General Counsel, Robert E. Williams, Ann Elizabeth Reesman, McGuiness & Williams, Washington, DC, amicus curiae Equal Employment Advisory Council.

Douglas A. Darch, Marcia A. Mahoney, Eric J. Gorman, Seyfarth, Shaw, Fairweather & Geraldson, Chicago, IL, amicus curiae Illinois Chamber of Commerce.

Thomas R. Meites, Paul W. Mollica, Meites, Frackman, Mulder & Burger, Chicago, IL, Richard T, Seymour, Lawyers Committee for Civil Rights Under Law, Washington, DC, amicus curiae Lawyers' Committee for Civil Rights Under Law.

Thomas R. Meites, Paul W. Mollica, Cynthia A. Wilson, Clyde Murphy, Chicago Lawyers' Committee for Civil Rights Under Law, Chicago, IL, amicus curiae Chicago Lawyers' Committee for Civil Rights Under Law, Inc.

Barry A. Gomberg (argued), Gomberg & Associates, Chicago, IL, for plaintiff-appellee in No. 96-2892.

Charles W. Pautsch (argued), Frank A. Gumina, Brian A. Price, Wessels & Pautsch Milwaukee, WI, for defendant-appellant in No. 96-2892.

Before POSNER, Chief Judge, and COFFEY and MANION, Circuit Judges.

POSNER, Chief Judge.

We have consolidated the appeals in two employment discrimination cases that raise the same two issues: Are arbitration clauses in collective bargaining agreements other than in the maritime, railroad, and other transportation industries subject to the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq.? And can a collective bargaining agreement compel an employee to arbitrate a claim that he may have under one of the federal statutes, such as Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, or the Americans with Disabilities Act, that confer litigable rights on employees? The first issue is critical to our jurisdiction of these appeals; the second is the issue on the merits--which, of course, we can reach only if we satisfy ourselves that we have jurisdiction.

Each of the two plaintiffs is a former employee of one of the defendants, and each was discharged by his employer in alleged violation of federal law. Pryner is black and complains that he was discharged in violation of Title VII and of 42 U.S.C. § 1981 because of his race and also because he had complained about Tractor Supply's previous racial discrimination against him before he was fired; he also has a claim under the Americans with Disabilities Act. Tractor Supply has counterclaimed against Pryner, but the counterclaim is not involved in this appeal. Sobierajski complains of having been discharged because of his age (58 at the time of the discharge), in violation of the Age Discrimination in Employment Act, and because of a disability, in violation of the ADA.

Both plaintiffs were employed under collective bargaining agreements. The agreement between defendant Thoesen and Sobierajski's union, the automobile mechanics union, provided that "in accordance with applicable Federal and State law, neither the company nor the Union will discriminate against employees covered by this collective bargaining agreement in regard to any terms or conditions of employment on the basis of race, creed, religion, national origin, sex or age." The agreement between Tractor Supply and Pryner's union, the teamsters, contains a similar provision but does not refer to federal or state law and adds to the prohibition against discrimination in regard to any "terms or conditions of employment" a prohibition against discrimination "with respect to hiring [or] compensation." Both agreements authorize the employer to impose discipline on an employee, up to and including discharge, for "just cause." And both contain a clause that creates a grievance procedure, making the union the employee's griever and culminating in arbitration if the matter is not resolved in the earlier stages of the procedure, for disputes involving "interpretation or application" of the agreement.

Both Sobierajski and Pryner invoked the grievance procedure in their respective collective bargaining agreements. Pryner's union struck out at the earlier stages of the grievance procedure, and has demanded arbitration. Sobierajski's grievance, however, was abandoned, though whether by his own actions or those of the union is unclear. Pryner and Sobierajski then filed these discrimination suits, seeking damages (including punitive damages in the case of Pryner), attorneys' fees, and reinstatement. The defendants moved to stay the suits pending arbitration of the plaintiffs' claims. The motions were denied (Pryner's in Pryner v. Tractor Supply Co., 927 F.Supp. 1140 (S.D.Ind.1996)), and the defendants have appealed from these denials. Sobierajski may be barred from seeking arbitration, having failed to exhaust his remedies. In that event, the stay would be pointless. But failure to exhaust contractual remedies would presumably bar his suit if, as the employers argue, the arbitration clauses in these collective bargaining agreements preclude suits to enforce statutory rights; otherwise the worker could circumvent the clause by disabling himself from seeking arbitration. So Thoesen also filed a motion in the district court to dismiss Sobierajski's suit, and it was also denied. The question whether failure to exhaust the prearbitration grievance procedure would be a bar to suing is independent of the effect of the arbitration clause and was not raised in Thoesen's motion. We express no view on it.

The issue of our appellate jurisdiction is whether these two appeals are authorized by the Federal Arbitration Act. The denial of a stay of proceedings before the court asked to grant the stay is not a final decision within the meaning of 28 U.S.C. § 1291, but when it is the denial of a stay of those proceedings pending arbitration it nevertheless is appealable immediately, at least (and probably at most, see Central States, Southeast & Southwest Areas Pension Fund v. Central Cartage Co., 84 F.3d 988, 990-92 (7th Cir.1996)) if the motion is filed under the arbitration act, which expressly authorizes such appeals. 9 U.S.C. § 16(a)(1)(A). See IDS Life Ins. Co. v. SunAmerica, Inc., 103 F.3d 524, 526 (7th Cir.1996). The act covers maritime transactions and transactions involving interstate commerce. 9 U.S.C. § 2. But "contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce" are specifically excluded by section 1.

If "engaged in foreign or interstate commerce" is given its usual modern legal meaning, virtually all employment contracts are within the exclusion, including the two collective bargaining agreements upon which the defendants based their motions for a stay. Some courts so read it. Pritzker v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 7 F.3d 1110, 1120 (3d Cir.1993); Willis v. Dean Witter Reynolds, Inc., 948 F.2d 305, 310-12 (6th Cir.1991); Herring v. Delta Air Lines, Inc., 894 F.2d 1020, 1023 (9th Cir.1989); United Food & Commercial Workers v. Safeway Stores, Inc., 889 F.2d 940, 943-44 (10th Cir.1989). Others confine the exclusion to collective bargaining agreements, as in United Electrical, Radio & Machine Workers v. Miller Metal Products, Inc., 215 F.2d 221, 224 (4th Cir.1954); see also Domino Sugar Corp. v. Sugar Workers Local Union 392, 10 F.3d 1064, 1067 (4th Cir.1993). Others deem the arbitration act superseded with regard to such agreements by section 301 of the Taft-Hartley Act, 29 U.S.C. § 185--as did we in Martin v. Youngstown Sheet & Tube Co., 911 F.2d 1239, 1244 (7th Cir.1990), and the cases cited there. But in International Union of Operating Engineers v. Murphy Co., 82 F.3d 185, 188-89 (7th Cir.1996), we assumed the opposite (that the arbitration act is not superseded by section 301), without citing Martin. And in Chicago Typographical Union v. Chicago Sun-Times, 935 F.2d 1501, 1504 (7th Cir.1991), decided between Martin and International Union of Operating Engineers, we had described the issue of supersession as an open one.

A footnote in United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 40 n. 9, 108 S.Ct. 364, 372 n. 9, 98 L.Ed.2d 286 (1987), says that the arbitration act does not apply to labor arbitration. But the footnote gives no reason; is inconsistent with the Supreme Court's subsequent decision in Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 25 n. 2, 111 S.Ct. 1647, 1651, 114 L.Ed.2d 26 (1991), which expressly left the question open; and goes on to cite with apparent approval our decision in Pietro Scalzitti Co. v. International Union of Operating Engineers, 351 F.2d 576, 579-80 (7th Cir.1965), which, limiting the exclusion of employment contracts in section 1 to workers engaged in the physical movement of goods in interstate or foreign commerce, holds that the arbitration act applies to labor arbitration in all industries except transportation. See also Briggs & Stratton Corp. v. Local 232, 36 F.3d 712, 714-15 (7th Cir.1994); Miller Brewing Co. v. Brewery Workers Local Union No. 9, 739 F.2d 1159,...