Grievances

Summary: A grievance is a complaint by an employee or group of employees about an alleged violation, misinterpretation, or inequitable application of a union contract or, in a nonunion company, any personnel policies or rules and regulations. A grievance procedure is a way of attempting to resolve such difficulties. A grievance procedure is not for the purpose of settling a particular, personal problem between an employer or supervisor and an employee.

Note that the National Labor Relations Act (NLRA) prohibits employers from establishing rules to prevent employees from engaging in protected activities, such as discussing their grievances and complaints among themselves--but they do have the power to establish rules requiring employees to have such discussions during non-work time in a way that does not interfere with work performance.

How Does a Grievance Procedure Work?

In a union setting

In unionized workplaces, grievance procedures are regulated by the union contract and are generally formal, rule-based processes. The collective bargaining agreement will govern the handling of grievances filed by employees within the bargaining unit. For more information regarding unions, see the Unions section, linked below.

In a nonunion company

Employers with no union in place have greater latitude to set up mechanisms for resolving grievances. As long as the mechanism provides a method by which individual employees can present grievances to management on an individual basis, it is acceptable. The best grievance procedures allow employees to discuss their concerns with multiple members of the management team, not just their immediate supervisors. For example, a common form of grievance procedure provides that an employee can appeal a grievance to management levels beyond his or her immediate supervisor.

The NLRA. Even in a nonunionized workplace, grievances may be sometimes subject to federal regulation under the NLRA. This might occur when the presentation of a grievance by an employee or a group of employees in a nonunion plant is deemed to be a "concerted action" and thus a protected activity under the NLRA. In such cases, the employer must be especially careful not to discriminate against the employee or employees who filed the grievance. For instance, firing the leader or any of the members of a self-appointed committee or in any other way penalizing committee members for such an activity may be illegal. The individuals penalized may be entitled to file a complaint with the National Labor Relations Board (NLRB), charging the employer with an unfair labor practice. If it becomes necessary to discipline someone who has filed a grievance, be sure there is a good, solid justification for the action and that it can't be viewed as retaliation for the presentation of the grievance.

If suddenly confronted with an employee committee or "spokesperson," listen carefully and promise to consider the matter in good faith. Then either announce the resolution by bulletin board notice or some similar method to all employees affected, or meet with each affected employee individually, relative to his or her own specific grievance. It is inadvisable to negotiate with the committee or spokesperson, since this can sometimes constitute recognition of the group as a union. For further discussion of "concerted action," see the Unions section, linked below.

Forms of Alternative Dispute Resolution

"Alternative dispute resolution (ADR)" is defined as any means of resolving a conflict that does not involve a court of law. Mediation and arbitration are two of the most common forms of ADR. Historically, employers have shown little interest in ADR because they were reluctant to diminish management's authority to resolve grievances without interference. However, as an effective means of controlling legal costs and stemming the proliferation of employee lawsuits, many employers are now taking an interest in ADR.

Arbitration. Arbitration is a process whereby the parties to a grievance choose a neutral third party to hear and resolve their dispute. The arbitration process is formal and can even resemble a traditional court case, with the presentation of evidence and witnesses. In general, the arbitrator's decision is final and binding on both parties.

Mandatory arbitration agreements. The trend toward an alternative means of settling employment disputes was strengthened by the U.S. Supreme Court's decision in Circuit City Stores, Inc. v. Adams, 532 U.S. 105 (2001). In that case, the Court held that the Federal Arbitration Act (FAA) governs arbitration agreements in the employment setting, excluding only transportation workers. For practical purposes, this ruling means that well-drafted mandatory arbitration agreements between employers and employees will often be enforced.

However, the Court also ruled that the Equal Employment Opportunity Commission (EEOC), the agency in charge of investigating claims of employment discrimination, may sue an employer for civil rights violations even when the employee has signed an arbitration agreement (EEOC v. Waffle House, 534 U.S. 279 (2002)). The Court held that the FAA, though encouraging arbitration, does not prevent EEOC from exercising its authority to fight employer bias, despite the existence of an arbitration agreement. Practically speaking, this case will likely not have a tremendous impact on employers, because EEOC gets involved only in a fraction of cases. However, employers must take the ruling into consideration when deciding whether to implement an arbitration agreement.

Employers interested in incorporating mandatory arbitration agreements into their workplaces must pay careful attention to their states' laws on arbitration when drafting these agreements and should seek the advice of an attorney.

Mediation. Mediators are also independent third parties. Generally, a mediator will listen to both sides of the dispute and recommend mutually agreeable resolutions. The mediation process is often significantly less formal than arbitration, and the mediator's decision is not binding on the parties.

Peer review. Arbitration, which has been used for years by employers with union contracts, has spun off a variation called "peer review," and some employers see it as an indispensable union-avoidance tool. Because it creates a perception of fairness that is not possible with conventional grievance procedures, it can remove an important incentive to unionize.

As with arbitration, peer review involves a trial-like hearing before a team of fact finders. The difference is that the decision-making panel consists of employees, often two from management and three from the employee's peer group. Acting as judge and jury, the panel decides each case on its merits, and its decisions usually are binding on all parties.

Elements of An Effective Grievance Procedure

If you do choose to implement some form of grievance procedure or ADR in the workplace, it is wise to consider the practical and legal implications of such action. The following is a summary of some points to consider:

Practical points to cover

Covered disputes. State what issues may come within the scope of the grievance or arbitration procedure. Are only termination decisions covered by the procedure? Will there be occasions when an employee may not be permitted to make use of the proceeding, such as in the case of drug use, theft, or—at the other extreme—minor offenses such as suspensions for being late? Can denials of promotion, raises, issues of safety, general working conditions, and the like be proper subjects of your arbitration procedure?

Who will hear the arbitration? An outside organization such as the American Arbitration Association (AAA)? Please note that a decision by a panel handpicked by the employer may not be enforced by a court.

Step-by-step procedures. Outside organizations, such as the AAA, publish detailed rules. Will you use the rules of the external organization or your own rules? If you use your own rules, will the outside organization apply them? Or will it refuse to administer your process because it deems your rules to be unfair? Who will pay the cost? Will there be notes (e.g., statements made, witnesses, members of the panel)? Will there be an opportunity for the employee to examine all the information used? Will the employee have an opportunity to respond in writing and verbally? Can the employee be represented by an attorney?

Time limits. State any time limits that apply. If the time limits are too short, a court may not enforce the decision.

Finality. Will the employee be bound by the result? In order for the procedure to be binding, it must meet certain minimal procedural requirements. It is wise to consult with counsel before designing such a system.

Voluntary arbitration. Some employers now require employees to agree to binding arbitration as a condition of employment. Carefully consider whether to include this requirement in the policy. If it is, consider whether the requirement is enforceable and whether a contract of employment has been created.

Review of policy. Review the arbitration policy at least annually. Determine whether it is meeting its goals, whether employees perceive it to be a fair system, or whether there have been changes in the law that require a change in your system.

Legal points to cover

Controlling law. Which law controls? Is the policy governed by the Federal Arbitration Act or state law? What are the advantages and disadvantages of each? Currently, many federal courts look with favor upon arbitration agreements while some state courts appear to be hostile to such agreements.

Discovery. Are there discovery procedures under the arbitration rules sufficient to permit the employee a fair opportunity to present his or her claims? Such discovery provisions include document production, information requests, depositions, and subpoenas.

Written decision. Does the policy provide for a written decision? Courts generally require a binding arbitration award to be written to protect against a lack of public knowledge of employer discriminatory policies and an inability to obtain effective appellate review. The writing should contain the names of the parties, a summary of the issues involved, and a description of the award issued

Awards. Does the arbitrator have the power to award damages? To reinstate a fired employee? Can punitive damages be awarded? Can employees be promoted? If reinstatement cannot be awarded, or if punitive damages cannot be awarded, will the arbitration agreement be enforced? If it is intended that the proceeding be binding on the employee with respect to discrimination claims so as to avoid the courtroom, the remedies will normally need to be the same as those provided under applicable laws, such as Title VII of the Civil Rights Act of 1991 and the Americans with Disabilities Act. On the other hand, it may be desirable to limit the remedies, even if it means that the decision is not binding on the employee. Keep in mind that if a remedy is provided and the decision is not binding on the employee, the employee might be able to accept the remedy and still file a lawsuit.

Enforcement. Is the agreement to use binding arbitration enforceable? The fact that the employer and employee may have unequal bargaining power is probably not sufficient to hold the arbitration agreement unenforceable. However, if there exists the type of fraud or overwhelming economic power that would provide grounds for the revocation of any contract, the arbitration provisions in an employment agreement could probably be overturned.

Regulatory agencies. Will an arbitration agreement between the employer and employee affect a federal or state agency? Will the agency abide by the result or file suit on its own? Monitor whether the discontinuance of an arbitration procedure because the employer files a complaint with a federal or state agency violates federal or state law. For example, reducing an employee’s right under an arbitration procedure by terminating that procedure because he or she filed a discrimination claim with the Equal Employment Opportunity Commission could be viewed as retaliation for filing that claim.

Litigation. Arbitration awards are subject to challenge if they violate a well-defined and dominant policy. Further, courts have overruled an arbitrator’s decision when they viewed the decision as violating such a public policy.

Weingarten Rights

The right of an employee to have a representative present at an investigatory meeting that the employee reasonably believes might result in discipline covers unionized workplaces only, the National Labor Relations Board has recently ruled. These are called Weingarten rights, after the U.S. Supreme Court case where employees represented by a union won the right to have a representative accompany them to a disciplinary interview (NLRB v. J. Weingarten, Inc., 420 U.S. 251 (1975)). In 2000, the board granted Weingarten rights to nonunion employees.

On June 9, 2004, however, the board reversed and ruled that employees who work in a nonunionized workplace are not entitled to have a co-worker/representative accompany them to an investigatory interview with their employer. The board's most recent ruling conflicts with a 2001 decision by the D.C. Circuit Court of Appeals, which upheld the NLRB's 2000 decision to grant Weingarten rights to nonunion employees (Epilepsy Foundation of Northeast Ohio v. NLRB, 268 F.3d 1095 (DC Cir. 2001)).

Additional Information and Links

For additional information, contact:

National Labor Relations Board
1099 14th Street
Washington, DC 20570-0001
866-677-6572
www.nlrb.gov

Federal Mediation and Conciliation Service
2100 K Street NW
Washington, DC 20427
(202) 606-8100
www.fmcs.gov

From the HR.BLR.com Library:

• Unions
• National Labor Relations Act (NLRA)