Nolde Bros., Inc. v. Bakery Workers, 430 U.S. 243 (1977)

Author: Justice Stewart

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Nolde Bros., Inc. v. Bakery Workers, 430 U.S. 243 (1977)

MR. JUSTICE STEWART, with whom MR. JUSTICE REHNQUIST Joins, dissenting.

When a dispute arises between two parties, that dispute is to be settled by the process of arbitration only if there is an agreement between the parties that the dispute will be settled by that means. Yet the Court today says that a union-employer dispute must be settled by arbitration even though the dispute did not even arise until after the contract containing an agreement to arbitrate had been terminated by action of the Union, and the employer had closed its business. I think this conclusion is neither required by existing precedent nor based upon any realistic appraisal of the contracting parties’ intent.

Our cases, to be sure, have established the importance of arbitration in resolving disputes arising under collective bargaining agreements, and in thereby maintaining peaceful labor relations. A collective bargaining agreement erects a system of industrial self-government; grievance and arbitration provisions in such an agreement make that collective bargaining process continuous:

Arbitration is the means of solving the unforeseeable by molding a system of private law for all the problems which may arise and to provide for their solution in a way which will generally accord with the variant needs and desires of the parties.

Steelworkers v. Warrior & Gulf Nav. Co., 363 U.S. 574, 581.

But the duty to arbitrate can arise only upon the parties’ agreement to resolve their contractual differences in the arbitral forum. And the presumptive continuation of that duty even after the formal expiration of such an agreement can be justified only in terms of a web of assumptions about the continuing nature of the labor-management relationship and the importance of having available a method harmoniously to resolve differences arising in that relationship. See generally id. at 578.

Those assumptions are wholly inapplicable to this case. The closing of the bakery by the employer-petitioner necessarily meant that there was no continuing relationship to protect or preserve. Cf. John Wiley & Sons v. Livingston, 376 U.S. 543; Howard Johnson Co. v. Hotel Employees, 417 U.S. 249. And the Union’s termination of the contract, thereby releasing it from its obligation not to strike, foreclosed any reason for implying a continuing duty on the part of the employer to arbitrate as a quid pro quo for the Union’s offsetting, enforceable duty to negotiate rather than strike. See Boys Markets, Inc. v. Retail Clerks, 398 U.S. 235.

Although for these reasons no continuing duty to arbitrate can be presumed in this case in the interest of maintaining industrial peace, it might nevertheless rationally be argued that the arbitration agreement was a term or condition of employment that the employer could not unilaterally change without first bargaining to impasse. See 29 U.S.C. § 158(a)(5). The trouble with that argument is that the National Labor Relations Board has rejected the notion that arbitration is a term or condition of employment that by operation of statute continues even after the contract embodying it has terminated. The Board, instead, has viewed arbitration as an obligation that arises solely out of contract, and is favored, but not statutorily required, as a dispute-resolving mechanism. See Hilton-Davis Chemical Co., 185 N.L.R.B. 241 (1970). See also Gateway Coal Co. v. Mine Workers, 414 U.S. 368.

It is clear, therefore, that neither federal labor law nor the interest of maintaining industrial peace can serve to explain the Court’s conclusion that the presumption of arbitrability extends to the facts of this case.

I realize that our decisions have broadly held that doubts as to arbitrability under an arbitration clause are to be resolved in favor of arbitrability. See Warrior,& Gulf Nav. Co., supra. But those cases involved arbitration clauses that were undoubtedly in force at the time the dispute first arose, and arbitration was invoked to resolve issues arising during the continuing course of the employer employee relationship. (See, e.g., Piano Workers v. W. W. Kimball Co., 379 U.S. 357, where a dispute over the rights of employees to preferential hiring at a new plant commenced before the contract at the old plant had expired.) The question here, by contrast, is whether the presumption of arbitrability survived even when the contract providing for arbitration had terminated and the rights in dispute, though claimed to arise under the contract, ripened only after the contract had expired and the employment relationship had terminated.

For the reasons I have expressed, I think there was no agreement to arbitrate this dispute. The Union had, of course, a clear cause of action under § 301 of the Labor Management Relations Act to seek judicial redress against the employer for its failure to meet its severance pay obligations to the employees. The Union did, in fact, bring just such a lawsuit in this case. If the Court of Appeals had addressed the merits of the litigation, as I believe it should have done, this controversy would have been settled long ago.

I respectfully dissent from the opinion and judgment of the Court.


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Chicago: Stewart, "Stewart, J., Dissenting," Nolde Bros., Inc. v. Bakery Workers, 430 U.S. 243 (1977) in 430 U.S. 243 430 U.S. 256–430 U.S. 258. Original Sources, accessed August 21, 2019,

MLA: Stewart. "Stewart, J., Dissenting." Nolde Bros., Inc. v. Bakery Workers, 430 U.S. 243 (1977), in 430 U.S. 243, pp. 430 U.S. 256–430 U.S. 258. Original Sources. 21 Aug. 2019.

Harvard: Stewart, 'Stewart, J., Dissenting' in Nolde Bros., Inc. v. Bakery Workers, 430 U.S. 243 (1977). cited in 1977, 430 U.S. 243, pp.430 U.S. 256–430 U.S. 258. Original Sources, retrieved 21 August 2019, from