Facts
- A union and an employer operating a textile mill engaged in interstate commerce entered a collective bargaining agreement with a no-strike clause and a grievance procedure ending in binding arbitration.
- Workplace disputes arose concerning workloads and job assignments.
- The union pursued the contractual grievance procedure and demanded arbitration; the employer refused to arbitrate.
- The union sued in federal district court under LMRA § 301(a) seeking specific performance compelling arbitration.
- The district court ordered the employer to arbitrate; the court of appeals reversed, concluding that while jurisdiction existed, the court lacked authority to compel arbitration.
- During the litigation, the employer ceased operations and contracted to sell the mill properties.
Issues
- Whether LMRA § 301(a) authorizes a federal court to order specific performance of an agreement to arbitrate grievance disputes in a collective bargaining agreement.
- Whether the substantive law governing § 301(a) suits is federal law fashioned by federal courts or state contract law applied in federal court.
- Whether § 301(a), construed to permit federal common-law development for labor contracts, is constitutional.
- Whether the Norris–LaGuardia Act bars injunctive relief compelling arbitration of grievance disputes.
- Whether the employer’s shutdown and sale rendered the case moot, in whole or in part.
Decision
- The Supreme Court reversed the court of appeals and held the district court could order specific performance compelling arbitration under § 301(a).
- The Court held that the substantive law in § 301(a) actions is federal law, to be developed by federal courts from national labor policy.
- The Court upheld § 301(a) as constitutional as construed.
- The Court held the Norris–LaGuardia Act does not withdraw federal jurisdiction to compel arbitration required by a collective bargaining agreement.
- The Court held the case was moot as to equitable relief restoring workloads and job assignments due to the shutdown, but not moot as to potential monetary relief that could be awarded through arbitration.
Legal Principles
- LMRA § 301(a) supports federal judicial enforcement of collective bargaining agreements, including ordering arbitration of grievance disputes.
- In § 301(a) suits, federal courts apply federal substantive law fashioned from national labor policy rather than treating state contract law as controlling.
- Federal labor policy favors arbitration as a mechanism for resolving grievance disputes and supporting labor peace; courts may enforce arbitration promises as part of the bargain reflected in collective bargaining agreements.
- The Norris–LaGuardia Act does not bar a federal court from ordering compliance with a collectively bargained arbitration clause in a grievance dispute.
- A labor dispute may become moot as to impracticable equitable relief after a shutdown, while remaining live as to monetary remedies that arbitration could determine.
Conclusion
The Court held that § 301(a) authorizes federal courts to compel arbitration under collective bargaining agreements and requires application of federally fashioned substantive law, while rejecting Norris–LaGuardia and mootness objections that would prevent arbitration-based monetary relief.