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HR Solutions

NLRB: Arbitration Procedure an Unfair Labor Practice

06/26/06

In 2003 a non-union company, U-Haul of California, sent out a new "Arbitration Policy" to all employees.  Accompanying the policy was an "agreement to arbitrate" that extended to "all disputes relating to or arising out of" employment, and went on the identify examples, such as claims under the various federal and state discrimination laws.  The procedure covered "any other legal or equitable claims and causes of action recognized by local, state or federal law or regulations."

But, the arbitration procedure was "limited to disputes, claims or controversies that a court of law would be authorized to entertain or would have jurisdiction over to grant relief." 

The policy and procedure made no reference to the National Labor Relations Act.

Nevertheless, the Board found that the procedure was illegal on its face.  Its overly broad wording could reasonably be understood to mean that the procedure included the filing of unfair labor practice charges at the Board.  Although the company stressed that the procedure's limitation of the coverage of the arbitration to claims within the jurisdiction of the courts, the Board found that the courts have jurisdiction over unfair labor practice matters when they are appealed to the courts of appeals for enforcement. 

U-Haul of California, 346 NLRB No. 34 (June 2006)http://www.nlrb.gov/nlrb/shared_files/weekly/w3056.htm#UHaul

Your arbitration procedure should be drafted to avoid any waiver of the right to file agency charges.  An employee should not waive his right to file charges with the EEOC, the NLRB, or any other federal or state administrative body.