SW Legal studies in Business

Dispute as to Scope of Labor Arbitration Agreement Goes to Arbitration, Not to Court
Description

Appeals court held that where an agreement between a union and an employer called for arbitration of disputes, any disputes, including ones over the coverage of the arbitration agreement itself, must go to arbitration, not to court, for resolution.

Topic Labor Law
Key Words

Labor Dispute; Arbitration

C A S E   S U M M A R Y
Facts

TriMas owns manufacturing plants. It signed a neutrality agreement with a union. It thereby agreed to cooperate with the union in efforts to organize its workforce within certain guidelines. The agreement specified that any disputes about the agreement would be settled by arbitration. When the union told TriMas it was going to unionize a particular plant, TriMas objected, claiming it was not under the neutrality agreement. TriMas claimed the agreement was modified by an oral side agreement that excluded that plant. The union insisted on going to arbitration; TriMas refused. The union sued to compel arbitration, and the district court agreed. TriMas appealed.

Decision

Affirmed. When the parties agree to arbitrate disputes, they bargained for the arbitrator’s interpretation of their contract, not the court’s interpretation. Where the arbitration clause is broad, there is a presumption in favor of arbitration. Any ambiguities as to the scope of the arbitration clause are resolved in favor of arbitration. The claim that there was an oral modification of the arbitration agreement was irrelevant to the issue of whether the parties’ dispute was arbitrable. Questions about the enforceability of the underlying contract are left to the arbitrator, even if the attempt is to rescind or avoid arbitration under the contract.

Citation United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union v. TriMas, 531 F.3d 531 (7th Cir., 2008)

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