JOULE, INC., & others [Note 1] vs. RANDI SIMMONS & another. [Note 2]

BOTSFORD, J. The plaintiff Joulé Technical Staffing, Inc. (Joulé), employed the defendant, Randi Simmons, from 2008 to 2009. [Note 3] Both were parties to an employment agreement containing an arbitration provision that purported to cover claims of employment discrimination expressly. Simmons was terminated from her position in July, 2009. Simmons, who claims that her termination was based on discrimination and retaliation by Joulé, did not file a claim for arbitration under the arbitration provision, but did file a complaint of discrimination with the Massachusetts Commission Against Discrimination (MCAD). In response, Joulé filed in the Superior Court a complaint and a motion to compel arbitration of Simmons's discrimination claim. Before us is Joulé's interlocutory appeal from the order of a Superior Court judge that in principal part denied Joulé's motion to compel arbitration and stayed all further proceedings in the Superior Court case pending the outcome of the MCAD proceeding.

We conclude that pursuant to G. L. c. 151B, § 5, the MCAD may conduct its own, independent proceeding based on Simmons's complaint. With respect to Joulé and Simmons, however,

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if the arbitration provision in Simmons's employment agreement is valid -- an issue that remains to be resolved -- Joulé has a right to compel arbitration of a dispute between it and Simmons concerning her claim. Accordingly, we vacate the order of the Superior Court and remand for further proceedings. [Note 4]

1. Facts and procedural history. [Note 5] Joulé is in the business of providing staffing and business systems support to companies in various States. Joulé hired Randi Simmons for its Boston office in February, 2008, as "selling branch manager." In accepting the position, Simmons turned down another full-time job offer with another company. At some point after she began to work for the company, [Note 6] Joulé provided Simmons with a document titled "Employment Agreement with Confidentiality, Non-Competition, and Arbitration Provisions" (employment agreement, or agreement). The agreement contains an arbitration provision, quoted in the margin. [Note 7] Simmons had not received a copy or been informed

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of the employment agreement before starting her job. The agreement provides that Simmons had a right to consult an attorney prior to signing it, but that she would not "be offered employment until [she] sign[ed] and return[ed] this [a]greement." Simmons did not sign the agreement immediately but, rather, delayed until a "specific request was made for it by the human resources department," because she "felt apprehensive and uncomfortable about certain restrictions therein."

At the time Simmons was hired and thereafter presented with the employment agreement, she was pregnant, and the baby was born in due course. Simmons alleges that she was subjected to a hostile work environment and was denied a promotion and salary increase because of Joulé's biases against pregnant women and against women with children. She complained about the issue to Kristin Motta Zwickau, the director of Joulé's Boston office. On July 30, 2009, Joulé terminated Simmons's employment. On August 25, 2009, Simmons filed a complaint with the MCAD asserting discrimination on the basis of sex and pregnancy in violation of G. L. c. 151B, §§ 4 (1) and (11A); G. L. c. 149,

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§ 105D; Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq. (2006) (Title VII); and retaliation in violation of G. L. c. 151B, § 4 (4). As previously stated, Simmons did not initiate arbitration proceedings pursuant to the arbitration provision in the employment agreement. On November 19, 2009, Joulé filed its complaint and motion to compel arbitration in the Superior Court. Joulé requested the court to declare that the agreement was valid and binding on Simmons; that Simmons was required to submit to arbitration any claim against Joulé based on the facts alleged in her MCAD complaint; and that Simmons was precluded from acting as a litigant or party in any MCAD proceeding against Joulé. Simmons opposed the motion to compel arbitration, arguing that the arbitration provision in the agreement was unconscionable and did not unmistakably cover discrimination claims; and that in any event, her MCAD complaint or charge could proceed and she was entitled to "participate in the proceeding as the complainant." The MCAD thereafter filed an emergency motion to intervene that was allowed by a Superior Court judge. After a hearing, a different Superior Court judge (motion judge) accepted the MCAD's argument that its authority to conduct an investigation and adjudication of Simmons's claim of discrimination was not affected by the parties' agreement to arbitrate, and ordered that Joulé's motion to compel arbitration be denied, that the Superior Court action be stayed pending resolution of the MCAD's proceeding, and that the arbitration provision in the employment agreement did not preclude Simmons from participating as a party in the pending MCAD matter. Joulé appealed from the motion judge's order pursuant to G. L. c. 251, § 18 (a) (1). We granted the applications for direct appellate review filed by Simmons and the MCAD.

2. Discussion. General Laws c. 251, § 18 (a) (1), authorizes a party to appeal directly from the denial of an application to compel arbitration. See, e.g., Warfield v. Beth Israel Deaconess Med. Ctr., Inc., 454 Mass. 390, 394 (2009) (Warfield). All parties agree, therefore, that Joulé's interlocutory appeal from the motion judge's order is properly before us. We review the judge's order de novo. See Feeney v. Dell Inc., 454 Mass. 192, 199 (2009), citing Commonwealth v. Philip Morris Inc., 448 Mass. 836, 844 (2007). See also Warfield, supra at 395 (motion to

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compel arbitration treated summarily and judge's order reviewed de novo).

a. Effect of the employment agreement's arbitration provision on the MCAD. We consider first the effect of the arbitration provision on the MCAD's ability to pursue its investigation and resolution of Simmons's MCAD complaint. "The MCAD was established to enforce the Commonwealth's antidiscrimination laws." Stonehill College v. Massachusetts Comm'n Against Discrimination, 441 Mass. 549, 563, cert. denied sub nom. Wilfert Bros. Realty Co. v. Massachusetts Comm'n Against Discrimination, 543 U.S. 979 (2004) (Stonehill College). The MCAD has the power to investigate claims of discrimination on its own, but also has the authority -- and generally follows this course -- to investigate and pursue complaints filed by individuals. See G. L. c. 151B, § 5. In the latter circumstance, although the complaint is filed by the individual, the agency proceeds in its own name. See Stonehill College, supra (in proceeding under G. L. c. 151B, § 5, "it is the MCAD, and not the complainant, that prosecutes the discrimination claim").

We review briefly the MCAD's procedure in investigating such complaints. See generally G. L. c. 151B, § 5. Any individual alleging discrimination in employment (or otherwise), or the Attorney General, may file a complaint with the MCAD. 804 Code Mass. Regs. § 1.10(1) (1999). The chairperson of the MCAD then designates a single commissioner to investigate the complaint promptly. 804 Code Mass. Regs. § 1.10. If the investigating commissioner finds no probable cause for crediting the allegations of the complaint, the commissioner issues a lack of probable cause finding and dismisses the complaint. 804 Code Mass. Regs. § 1.15(7)(b) (2008). If, however, the commissioner determines that probable cause does exist for crediting the allegations, he or she issues a probable cause finding. Id. At that point, the investigating commissioner endeavors to "eliminate the unlawful practice complained of through conference, conciliation and persuasion." 804 Code Mass. Regs. § 1.18 (2005). If conciliation is unsuccessful it may be terminated, see 804 Code Mass. Regs. § 1.18(1)(d), and if the investigating commissioner determines that the public interest requires a certification of issues to public hearing, the commissioner issues a complaint in the name of the

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MCAD. 804 Code Mass. Regs. § 1.20(3) (2004). Such a public hearing is conducted by an MCAD commissioner other than the investigating commissioner, or by a designated hearing officer, or by the full commission. 804 Code Mass. Regs. § 1.21(1) (1999). The case is prosecuted by an MCAD attorney or other staff member, or in some instances by the complainant's attorney whom the MCAD has designated its agent for the purpose. 804 Code Mass. Regs. § 1.09(5)(a), (b) (1999). A complainant may be permitted to intervene as a party in the case, in the commissioner's discretion, and also be allowed to testify at the hearing. 804 Code Mass. Regs. § 1.20(4) (2004). If, after the hearing, the MCAD finds that the respondent employer has engaged in an unlawful practice as defined in the statute, the MCAD may require the respondent to "cease and desist from such unlawful practice," and may grant relief specific to the complaining individual such as "hiring, reinstatement or upgrading of [the] employee[], with or without back pay . . . as, in the judgment of the [MCAD], will effectuate the purposes of this chapter." G. L. c. 151B, § 5. See 804 Code Mass. Regs. § 1.22 (1999).

Under both Federal and Massachusetts arbitration statutes, it is clear that parties can agree to arbitrate claims of employment discrimination. See Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 26-27 (1991); Warfield, 454 Mass. at 395-396; Rosenberg v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 170 F.3d 1, 17-21 (1st Cir. 1999). By its express terms, the arbitration provision in Simmons's employment agreement is governed both by the Massachusetts Arbitration Act, G. L. c. 251, § 2 (MAA), and by the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq. (2006) (FAA). For agreements governed by the FAA, the statute's presumption of arbitrability means that "in applying general state-law principles of contract interpretation to the interpretation of an arbitration agreement within the scope of the [FAA] . . . due regard must be given to the federal policy favoring arbitration, and ambiguities as to the scope of the arbitration clause itself resolved in favor of arbitration" (citation omitted). Volt Info. Sciences, Inc. v. Trustees of Leland Stanford Jr. Univ., 489 U.S. 468, 475-476 (1989). In Warfield, supra at 398, we acknowledged this point, but also held that, in view of the strong public policy against discrimination in employment,

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any agreement to arbitrate claims of discrimination must be stated clearly and unmistakably.

Even where there is a clear and unmistakable provision in an employment agreement requiring arbitration of discrimination claims, however, it would not affect the MCAD's authority under G. L. c. 151B, § 5. "The FAA directs courts to place arbitration agreements on equal footing with other contracts, but it 'does not require parties to arbitrate when they have not agreed to do so'. . . . 'Arbitration under the [FAA] is a matter of consent, not coercion.' " EEOC v. Waffle House, Inc., 534 U.S. 279, 293, 294 (2002) (Waffle House), quoting Volt Info. Sciences, Inc. v. Trustees of Leland Stanford Jr. Univ., 489 U.S. at 478, 479. The MCAD is not a party to the employment agreement at issue here, has not agreed to arbitration of Simmons's MCAD complaint, and cannot be bound by the agreement's arbitration provision. "[T]he proarbitration policy goals of the FAA do not require the agency to relinquish its statutory authority if it has not agreed to do so." Waffle House, supra at 294. Accordingly, assuming the validity of the agreement's arbitration provision, [Note 8] nothing in it precludes the MCAD from proceeding with its investigation and resolution of Simmons's discrimination complaint -- including, if the evidence warrants, granting relief specific to Simmons.

This conclusion is consistent with, and advances, the broad statutory responsibility and authority of the MCAD to investigate and remedy instances of discrimination in the Commonwealth. See Stonehill College, 441 Mass. at 562- 563, and cases cited ("While the main object of a judicial proceeding under [G. L. c. 151B,] § 9[,] is to recover damages for the individual victim of unlawful discrimination, . . . the primary purpose of an administrative proceeding before the MCAD is to vindicate the public's interest in reducing discrimination in the workplace by deterring, and punishing, instances of discrimination by employers against employees" [citation omitted]). See also Cuddyer v. Stop & Shop Supermarket Co., 434 Mass. 521, 534 (2001), quoting Lynn Teachers Union, Local 1037 v. Massachusetts Comm'n Against Discrimination, 406 Mass. 515, 523 (1990) ("the MCAD 'has been charged with the task of combating

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discrimination in the Commonwealth' "); College-Town, Div. of Interco, Inc. v. Massachusetts Comm'n Against Discrimination, 400 Mass. 156, 170 (1987) ("commission is given broad authority to remedy discrimination"); 804 Code Mass. Regs. § 1.13(4) (1999) ("No waiver agreement signed by any individual shall affect the [MCAD's] right and statutory duty to enforce [ ] G. L. c. 151B . . . or to investigate any complaint filed before it"). The United States Supreme Court reached the same result in the Waffle House case where an employee alleging handicap discrimination declined to initiate arbitration proceedings mandated by his employment agreement, but instead timely filed a charge of discrimination with the Equal Employment Opportunity Commission (EEOC) under Title VII. Waffle House, 534 U.S. at 283, 285. The Court concluded that the EEOC was authorized to bring its own enforcement action against the employer, notwithstanding the arbitration agreement between the employer and employee. Id. at 291-292, 296. It further stated that "once a charge is filed . . . the EEOC is in command of the process. . . . Absent textual support for a contrary view, it is the public agency's province -- not that of the court -- to determine whether public resources should be committed to the recovery of victim-specific relief." Id. at 291-292. [Note 9], [Note 10]

Joulé appears to agree both that the MCAD is empowered

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and entitled to pursue investigation of Simmons's discrimination complaint under G. L. c. 151B, § 5, and also that nothing in the arbitration provision of the parties' employment agreement does, or could, preclude Simmons from filing a complaint with the MCAD. [Note 11] Joulé argues, however, that beyond filing a complaint with the MCAD, under the arbitration provision, Simmons is barred from being a litigant or party to the MCAD proceeding, and that the motion judge erred in ruling otherwise. [Note 12] Again, if the arbitration provision in Simmons's employment agreement is valid (see Part 2[b], infra), we would agree. When

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a complainant files a request to intervene, see 804 Code Mass. Regs. § 1.20(4), she must certify her "allegations of discrimination." 804 Code Mass. Regs. § 1.20(3)(a) (2004). Thus, in essence, the complainant is required to advance a claim of discrimination in her own name. Allowing Simmons to seek to intervene as a party in the MCAD proceeding and to assert directly her individual claim of discrimination would contravene the requirement of the arbitration provision that she resolve her own disputes with Joulé through arbitration. The question whether Simmons may participate in the MCAD proceeding is a different matter. Nothing in the arbitration provision prevents her from testifying before the MCAD, see G. L. c. 151B, § 5, or from "provid [ing] information, materials or responses to [Joulé's] submissions which are necessary for investigation of the case" to obviate administrative foreclosure in accordance with 804 Code Mass. Regs. § 1.15(5)(b) (1999).

b. Stay of court proceedings. It is Joulé's position that the motion judge erred in granting the stay of further proceedings in its Superior Court action because, in accordance with Warfield, the terms of the arbitration provision are clear and unmistakable, and Simmons lacks any ground sufficient to revoke her agreement to arbitrate. See Warfield, 454 Mass. at 398. We agree that the stay should not have been granted, but for different reasons.

The motion judge assumed in effect that the arbitration provision was valid and, by staying Joulé's court action until the MCAD concluded its proceeding, appears to have adopted the premise advanced by the MCAD, namely, that the agency's proceeding takes precedence over any arbitration. However, "when parties agree to arbitrate all questions arising under a contract, state laws lodging primary jurisdiction in another forum, whether judicial or administrative, are superseded by the FAA." Preston v. Ferrer, 552 U.S. 346, 349-350 (2008). In staying further proceedings in Joulé's action to enforce the parties' agreement to arbitrate, the motion judge in effect placed primary jurisdiction over Simmons's discrimination-based claims in the MCAD. This was error. If an employer and employee enter into a valid and sufficiently clear agreement to arbitrate any and all disputes relating to discrimination, then the party seeking arbitration of such a dispute is entitled to have the agreement enforced.

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See Commonwealth v. Philip Morris Inc., 448 Mass. 836, 844-849 (2007) (arbitration provision enforced where dispute "falls squarely" under that provision). Cf. Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. at 23, 35 (employee's age discrimination claim can be subjected to compulsory arbitration pursuant to arbitration provision in mandated employment-related agreement signed by employee). For the reasons previously discussed, if, as in this case, the MCAD were then pursuing an investigation of the discrimination claim, the agency could proceed notwithstanding the arbitration provision in the parties' agreement, see Waffle House, 534 U.S. at 291-292, and there is no legal bar to having an arbitration and the MCAD proceeding continue concurrently, on parallel tracks. [Note 13]

In sum, Joulé would appear entitled to compel arbitration of a dispute with Simmons over her claims of employment discrimination if the agreement's arbitration provision is valid and meets the "clear and unmistakable" requirements of Warfield. [Note 14] Accordingly, the motion judge should have considered the merits

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of Simmons's challenge to the validity of the agreement's arbitration provision, namely, that its arbitration provision was unconscionable and therefore unenforceable. [Note 15] On remand, this challenge must be resolved. [Note 16] If Simmons's claim is upheld, then, obviously, arbitration cannot be ordered, and dismissal of Joulé's complaint would be in order. But if Simmons does not prevail on her challenge, then Joulé's motion to compel arbitration should be allowed.

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3. Conclusion. The order of the Superior Court denying the motion to compel arbitration is vacated, and the case is remanded to the Superior Court for proceedings consistent with this opinion.

So ordered.