866
OCTOBER TERM, 1997
Syllabus
certiorari to the united states court of appeals for the district of columbia circuit
No. 97-428. Argued March 23, 1998—Decided May 26, 1998
Petitioner Air Line Pilots Association (ALPA or Union), a private-sector labor organization covered by the Railway Labor Act (RLA), represents, as exclusive bargaining agent, pilots employed by Delta Air Lines (Delta). The collective-bargaining agreement between ALPA and Delta includes an "agency shop" clause that requires nonunion Delta pilots to pay ALPA a monthly service charge for representing them. For 1992, the first year ALPA collected an "agency fee" under the agency-shop agreement, the Union ultimately determined that 19 percent of its expenses were not germane to collective bargaining. Accordingly, ALPA collected an agency fee that amounted to 81 percent of its members' dues. Alleging that the Union had overstated the percentage of its expenditures genuinely attributable to "germane" activities, respondents, 153 Delta pilots, challenged in this federal-court action the manner in which ALPA calculated agency fees. Under ALPA's "Policies and Procedures Applicable to Agency Fees," adopted to comply with the "impartial decisionmaker" requirement set forth in Teachers v. Hudson, 475 U. S. 292, 310, pilots who object to the fee calculation may request arbitration under procedures devised by the American Arbitration Association (AAA). When 174 Delta pilots (including 91 of the respondents) filed timely objections to the 1992 agency-fee calculation, ALPA treated the objects as a request for arbitration and referred them to the AAA for resolution in a single, consolidated proceeding. The arbitrator declined to stay the arbitration in deference to the court proceeding, and sustained ALPA's calculation in substantial part. The District Court then granted ALPA's motion for summary judgment, concluding, inter alia, that pilots seeking to challenge the fee calculation must exhaust arbitral remedies before proceeding in court. Reversing, the Court of Appeals found no legal basis for requiring objectors to arbitrate agency-fee challenges when they had not agreed to do so. Having determined that the arbitrator's decision was no longer part of the legal picture, the appellate court remanded the case to the District Court.
Held: When a union adopts an arbitration process to comply with Hudson's "impartial decisionmaker" requirement, agency-fee objectors who have not agreed to the procedure may not be required to exhaust the
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