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In ordering arbitration of an employment dispute, a federal court in Massachusetts held that the arbitrator must decide whether the employer waived its right to demand arbitration by not complying with the requirements of its dispute resolution policy.
In Boateng v. General Dynamics Corp., No. 05-40222-FDS, 2007 WL 196833 (D. Mass. Jan. 26, 2007), Boateng sued General Dynamics, her former employer, for alleged race discrimination.
General Dynamics moved to compel arbitration pursuant to its dispute resolution policy, which required arbitration as the final step. In opposing the motion, Boateng argued that the arbitration agreement was unenforceable because she could not recall receiving a copy of the policy.
Despite Boateng’s lack of recall, the Court found that the arbitration agreement was enforceable because General Dynamics satisfied its “relatively light burden” of proving that Boateng was given notice “sufficient to apprise [her] that continued employment would effect a waiver of the right to pursue [her] claim in a judicial forum.” For example, General Dynamics submitted a document signed by Boateng whereby she agreed to resolve all disputes through the dispute resolution policy.
Boateng also opposed arbitration on the ground that General Dynamics waived its right to demand arbitration by failing to conduct a human resources review as required by the dispute resolution policy. In response, General Dynamics argued that the arbitrator should decide the waiver question.
Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79 (2002) established the rule that “procedural question which grow out of the dispute and bear on its final disposition are presumptively not for the judge, but for an arbitrator to decide.” Based on that rule, “the presumption is that the arbitrator should decide allegations of waiver, delay, or a like defense to arbitrability.” Howsam, 537 U.S. at 84.
In attempting to overcome the Howsam presumption, Boateng cited several cases in which the court decided the waiver question. However, as the Court explained, those cases involved a litigation-related waiver, which meant the court was uniquely situated to decide the waiver question.
Conversely, in this case, the alleged waiver was not based on litigation conduct. Accordingly, based on Howsam as well as “the liberal federal policy in favor of arbitration,” the Court held that the waiver question was for the arbitrator to decide.
In a recent unanimous decision, the Florida Supreme Court relied on the Howsam presumption in holding that the statute of limitations raised a procedural question for the arbitrator, rather than a question of arbitrability for the court. See O’Keefe Architects, Inc. v. CED Construction Partners, Ltd., No. SC05-1417, 2006 WL 2971783 (Fla. Oct. 19, 2006); but see Bryan County v. Yates Paving & Grading Co., No. S06G0119, 2006 WL 3438073 (Ga. Nov. 30, 2006) (holding by a 4-3 majority that the res judicata effect of a prior arbitration award was a question for the court under the Georgia Arbitration Code).
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