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RLA excludes "public policy" as ground for vacating arbitration award
July 17, 2006 by Ross Runkel at LawMemo

Arbitration awards can be vacated on the ground that they "violate public policy." But not awards issued under the Railway Labor Act.

That's the holding in Netjets Aviation v. Teamsters (SD Ohio 06/02/2006).

Netjets, a company covered by the federal Railway Labor Act, fired an employee for posting a nasty video on the union web site. The union grieved the discharge, and an arbitrator ordered the company to reinstate the employee.

The company sued to set aside the arbitrator's award, arguing that reinstating the employee would violate the public policy favoring safety in air travel and workplace safety.

I thought the company's argument was weak, and that reinstatement would not violate public policy.

The court, however, did not even look at the merits, saying:

The Court holds that public policy does not constitute a basis for reviewing the [award] under the RLA.

The court's theory was simple. The Railway Labor Act states three grounds for overturning an award: (1) failure to comply with the RLA, (2) exceeding jurisdiction, (3) fraud or corruption. Public policy is not on the list.

Interesting because courts typically say that public policy is a ground for vacating an award under the Federal Arbitration Act, even though the FAA has a specific list of grounds that does not include public policy.

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