The Brady Decision is Good for Unions

The National Football League is celebrating its victory at the Second Circuit Court of Appeals over the NFL Players’ Association in the case involving the four-game suspension of Tom Brady.  But, while the Player’s Association may have lost, they accomplished two important things in their defeat.  First, they called attention to fundamental flaws in the NFL’s disciplinary procedures.  Second, and more importantly for the rest of the labor movement, their defeat reaffirmed the principle that courts have no business reviewing the merits of an arbitrator’s award.

Almost all collective bargaining agreements provide for arbitration to resolve disputes arising under the agreement.  The agreement between the NFL and the Players’ Association is bizarre because the agreement allows the League Commissioner, who is hired by management, to serve as the arbitrator.  In a typical collective bargaining agreement, the arbitrator is a neutral, chosen jointly by the union and management.  The theory of arbitration is that it is supposed to be a more informal, quicker, and less expensive alternative to litigation.  Plus, as the Supreme Court once observed, the arbitrator is supposed to be an expert on the “custom and practices … of a particular industry.”  Of course, the reality does not always conform to this ideal.  But, whatever benefits arbitration confers on the parties are lost if the loser can run to court to seek plenary review of the arbitrator’s award.  And the delay and expense associated with judicial review usually work to management’s advantage.  The typical arbitration case involves a worker who was fired.  If the arbitrator reinstates the worker, the employer may hope that further delay will lead the worker to decline reinstatement.  By contrast, even if a union ultimately prevails after a lengthy legal fight, the victory may not be sufficient to overcome the sense of discouragement among the workers.  This is why unions have repeatedly fought to limit the scope of judicial review of arbitration awards.

The Second Circuit’s decision is good for unions because it reaffirms that courts should not review whether an arbitrator’s decision “rests on factual errors or misinterprets the parties’ agreement,” nor should judges consider whether they are “persuaded by the arbitrator’s reasoning.”  Applying this standard, the Court rejected the argument that Commissioner Roger Goodell, acting as the arbitrator, erred by analogizing Brady’s conduct to using steroids rather than to using “stickum” to enhance a player’s grip on the football.  The Court properly recognized that because its role is not to review the arbitrator’s award on the merits, it didn’t matter whether the judges found one analogy more persuasive than another.  The Court also properly deferred to the arbitrator regarding his decision to exclude certain testimony.  Parties count on arbitrators to control the scope of hearings in order to ensure that arbitration really is quicker and less expensive than litigation.  Here, the Players’ Association sought testimony from the NFL’s General Counsel to probe his role in preparing the investigative report that led to Brady’s discipline.  The Court recognized that any testimony on this issue would have been collateral to the core issues at the arbitration, and thus, the arbitrator acted within his discretion in excluding it.

The penalty imposed upon Brady may well have been “unfair.”  The case ought to serve as a wake-up call to the Players’ Association and to unions more generally about the importance of choosing truly impartial arbitrators.  But, the answer is not to look to the courts for justice.  The next time an employer runs to court to try to vacate an arbitrator’s award, I look forward to citing the Second Circuit’s decision in the Brady case.