In The

Supreme Court of the United States




Decided June 15, 1987

Justice O’Connor, Dissenting

Topic: Federalism*Court vote: 7–2
Note: No other Justices joined this opinion.
Citation: 482 U.S. 483 Docket: 86–566Audio: Listen to this case's oral arguments at Oyez

* As categorized by the Washington University Law Supreme Court Database

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JUSTICE O'CONNOR, dissenting.

The Court today holds that § 2 of the Federal Arbitration Act (Act), 9 U.S.C. § 1 et seq., requires the arbitration of appellee's claim for wages despite clear state policy to the contrary. This Court held in Southland Corp. v. Keating, 465 U. S. 1 (1984), that the Act applies to state court as well as federal court proceedings. Because I continue to believe that this holding was

unfaithful to congressional intent, unnecessary, and, in light of the [Act's] antecedents and the intervening contraction of federal power, inexplicable,

id. at 465 U. S. 36 (O'CONNOR, J., dissenting), I respectfully dissent.

Even if I were not to adhere to my position that the Act is inapplicable to state court proceedings, however, I would still dissent. We have held that Congress can limit or preclude a waiver of a judicial forum, and that Congress' intent to do so will be deduced from a statute's text or legislative history, or "from an inherent conflict between arbitration and the statute's underlying purposes." Shearson/American Express Inc. v. McMahon, ante at 482 U. S. 227. As JUSTICE STEVENS has observed, the Court has not explained why state legislatures should not also be able to limit or preclude waiver of a judicial forum:

We should not refuse to exercise independent judgment concerning the conditions under which an arbitration agreement, generally enforceable under the Act, can be held invalid as contrary to public policy simply because the source of the substantive law to which the arbitration agreement attaches is a State, rather than the Federal, Government. I find no evidence that Congress intended such a double standard to apply, and I would not lightly impute such an intent to the 1925 Congress which enacted the Arbitration Act.

Southland Corp. v. Keating, supra, at 465 U. S. 21.

Under the standards we most recently applied in Shearson/American Express Inc. v. McMahon, ante p. 482 U. S. 220, there can be little doubt that the California Legislature intended to preclude waiver of a judicial forum; it is clear, moreover, that this intent reflects an important state policy. Section 229 of the California Labor Code specifically provides that actions for the collection of wages may be maintained in the state courts "without regard to the existence of any private agreement to arbitrate." Cal.Lab.Code Ann. § 229 (West 1971). The California Legislature thereby intended

to protect the worker from the exploitative employer who would demand that a prospective employee sign away in advance his right to resort to the judicial system for redress of an employment grievance,

and § 229 has "manifested itself as an important state policy through interpretation by the California courts." Merrill Lynch, Pierce, Fenner & Smith v. Ware, 414 U. S. 117, 414 U. S. 131, 414 U. S. 132 -133 (1973).

In my view, therefore, even if the Act applies to state court proceedings, California's policy choice to preclude waivers of a judicial forum for wage claims is entitled to respect. Accordingly, I would affirm the judgment of the California Court of Appeal.

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