Vaughn v. Pacific Northwest Bell Telephone Co.

• Decision Date: 29 May 1979
• Docket Number: No. A-78-03-3484,A-78-03-3484
• Parties: Sandra VAUGHN, Appellant, v. PACIFIC NORTHWEST BELL TELEPHONE COMPANY, a Washington Corporation, Respondent. ; CA 11708.
• Court: Oregon Court of Appeals

Page 829

595 P.2d 829

40 Or.App. 427

Sandra VAUGHN, Appellant, v. PACIFIC NORTHWEST BELL TELEPHONE COMPANY, a Washington

Corporation, Respondent.

No. A-78-03-3484; CA 11708.

Court of Appeals of Oregon.

Argued and Submitted Feb. 21, 1979.

Decided May 29, 1979.

Robert K. Udziela, Portland, argued the cause for appellant. With him on the briefs was Pozzi, Wilson, Atchison, Kahn & O'Leary, Portland.

Jonathan T. Harnish, Portland, argued the cause for respondent. With him on the brief was Bullard, Korshoj & Smith, Portland.

Before SCHWAB, C. J., and TANZER, RICHARDSON and ROBERTS, JJ.

TANZER, Judge.

Plaintiff appeals from an order granting defendant's motion for summary judgment. Her complaint alleged that defendant committed an unlawful employment practice by refusing to reinstate her following her recovery from a compensable job-related injury. She sought reinstatement, back pay, punitive damages and attorney fees. Defendant's answer denied that it committed an unlawful employment practice and raised two factual affirmative defenses. Thereafter, defendant moved for summary judgment on the ground that the circuit court had no jurisdiction to order the relief requested by plaintiff, because federal law provides that the grievance and arbitration procedures set out in the employment contract constitute the exclusive remedy for resolving all employment-related disputes. The circuit court agreed and entered summary judgment for defendant. We reverse and remand for further proceedings.

Plaintiff's complaint is based on the statutory rights set out in ORS ch. 659. ORS 659.410 provides:

"It is unlawful employment practice for an employer to discriminate against a workman with respect to hire or tenure or any term or condition of employment because the workman has applied for benefits or invoked or utilized the procedures provided for in ORS 656.001 to 656.794 and 656.802 to 656.824, or of 659.400 to 659.435 or has given testimony under the provisions of such sections."

ORS 659.415 mandates reinstatement of workers who have recovered from compensable injuries:

"A workman who has sustained a compensable injury shall be reinstated by his employer to his former position of employment or employment which is available and suitable upon demand for such reinstatement, provided that the workman is not disabled from performing the duties of such position. A certificate by a duly licensed physician that the physician approves the workman's return to his regular employment shall be prima facie evidence that the workman is able to perform such duties."

ORS 659.121(1) provides a cause of suit for violations of ORS 659.410 and 659.415:

"Any person claiming to be aggrieved by an unlawful employment practice prohibited by ORS 659.024, 659.026, 659.030, 659.410, 659.415 or subsection (1) of 659.425 may file a civil suit in circuit court for injunctive relief and the court may order such other equitable relief as may be appropriate, including but not limited to reinstatement or the hiring of employes with or without back pay. * * * "

Plaintiff's complaint alleges in pertinent part that she suffered a compensable injury on August 30, 1977, in the course of her employment with defendant, that she presented defendant with a physician's certificate approving her return to her regular employment on February 1, 1978, and that defendant committed an unlawful employment practice by refusing to re-employ her in her regular work or any other suitable job. These allegations state a cause of suit under ORS 659.410, 659.415 and 659.121(1). If the statutes are effective, plaintiff has stated a cause of suit cognizable in circuit court.

Defendant contends that the statutory provisions on which plaintiff relies are void under the Supremacy Clause of the federal constitution, ¹ insofar as they purport to grant plaintiff a judicial remedy in this case, because they conflict with federal law requiring persons employed by a business affecting interstate commerce to exhaust grievance and arbitration procedures provided for in the employment contract before seeking a judicial remedy. ² Defendant's contention is based on section 203(d) of the Labor-Management Relations Act of 1947 (LMRA), 29 U.S.C. § 173(d), and a series of United States Supreme Court decisions expressing federal policy to enforce arbitration agreements contained in employment contracts covered by the LMRA. We will set out the authorities cited by defendant and then explain why they do not govern our decision in this case.

Section 203(d) of the LMRA provides in part:

"Final adjustment by a method agreed upon by the parties is declared to be the desirable method for settlement of grievance disputes arising over the application or interpretation of an existing collective bargaining agreement. * * * "

Applying this section in United Steelworkers v. American Mfg. Co., 363 U.S. 564, 566, 80 S.Ct. 1343, 1346, 4 L.Ed.2d 1403 (1960), the Supreme Court stated that the statutory "policy can be effectuated only if the means chosen by the parties for settlement of their differences under a collective bargaining agreement is given full play." In United Steelworkers v. Warrior & G. Nav. Co., 363 U.S. 574, 581-83, 80 S.Ct. 1347, 1352-1353, 4 L.Ed.2d 1409 (1960), the Court stated:

"Apart from matters that the parties specifically exclude, all of the questions on which the parties disagree must therefore come within the scope of the grievance and arbitration provisions of the collective agreement.

" * * *

" * * * An order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage.

Where an employe seeks a judicial remedy for a violation of the employment contract without first exhausting grievance procedures, the employer may defend successfully on the ground that the contractual grievance procedures constitute the exclusive remedy for disputes arising under the collective bargaining agreement. Republic Steel Corp. v. Maddox, 379 U.S. 650, 652-53, 85 S.Ct. 614, 13 L.Ed.2d 580 (1965); See also Vaca v. Sipes, 386 U.S. 171, 184, 87 S.Ct. 903, 17 L.Ed.2d 842 (1967); Gilstrap v. Mitchell Bros. Truck Lines, 270 Or. 599, 606-11, 529 P.2d 370 (1974) (restating general rule requiring exhaustion of grievance procedures and establishing exceptions not applicable to this case). Judicial review of an arbitrator's decision is confined to a determination of whether on its face the claim is governed by the contract; interpretation of the contract itself is for the arbitrator, and courts may not resolve the merits of the grievance. United Steelworkers v. American Mfg. Co., 363 U.S. at 567-68,80 S.Ct. 1347.

These cases establish the general principle that an employe may not circumvent contractual grievance procedures by seeking judicial relief for a breach of the collective bargaining agreement without first exhausting the grievance procedures. However, all the cases applying this rule involve attempts to enforce contractual rights arising from the collective bargaining agreement. The principle does not control the present case, because plaintiff is not seeking a remedy for breach of the employment contract. Rather, she seeks enforcement of her statutory rights under ORS 659.121, 659.410 and 659.415. For the reasons which follow, we conclude that judicial relief for a violation of a right arising from statute is an independent remedy which is not foreclosed by the availability of or resort to a grievance procedure for arbitration of rights arising from the contract.

The terms of section 203(d) of the LMRA, the source of the federal policy favoring grievance and arbitration procedures, limit the policy to "disputes arising over the application or interpretation of an existing collective bargaining agreement." The United States Supreme Court decisions expressing that policy also recognize that limitation:

" * * * an arbitrator is confined to interpretation and application of the collective bargaining agreement; * * *. He may of course look for guidance from many sources, yet his award is legitimate only so long as it draws its essence from the collective bargaining agreement." United Steelworkers v. Enterprise Corp., 363 U.S. 593, 597, 80 S.Ct. 1358, 1361, 4 L.Ed.2d 1424 (1960).

More recently, in Alexander v. Gardner-Denver Company, 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974), the Supreme Court held that an employe's right to trial de novo of a discrimination claim under Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e, et seq., is not waived or foreclosed by prior submission of the claim to final arbitration under the nondiscrimination clause of the collective bargaining agreement. Alexander does not compel the result in this case because the decision turns in part on the Court's reading of Congressional...