Labor & Employment Law Daily Wrap Up, LABOR—ARBITRATION—7th Cir.: Public policy did not warrant employer’s refusal to comply with arbitration award, (Jun 8, 2026)

By Ronald Miller, J.D.

The public policy of Illinois simply does not address how employers address actual or implicit threats of violence at work.

Because there was nothing wrong with either the process of selecting an arbitrator or the substance of his decision, the Seventh Circuit confirmed the judgment of an arbitration award. This case stemmed from an incident in which a hotel employee displayed a knife in the workplace, resulting in this termination. After being ordered to arbitration, the arbitrator found that the incident deserved a suspension, not termination, and ordered the employee reinstated, a result with which the employer refused to comply, asserting the award violated public policy. In confirming the award, the appeals court observed that a public policy against violence in the workplace is directed against those who employ violence, not against employers trying to choose the best methods of curtailing violence (UNITE HERE Local 1 v. Magnificent Mile Hotel Management, LLC dba Chicago Hotel Collection, No. 25-1265 (7th Cir. June 5, 2026)).

Arbitration award. The employer fired one of its employees after he displayed a knife in the workplace and another employee felt threatened. The fired employee’s union filed a grievance, but the employer refused to arbitrate. A district court ordered the hotel to proceed using an arbitrator chosen from a list. That arbitrator then found that displaying the knife justified a suspension without pay but did not supply just cause for discharge. He ordered the employee reinstated, with back pay, minus 10 days’ wages. The hotel refused to comply. In response to the union’s motion to confirm, the district court ordered the employer to do so.

Selection of arbitrator. According to the collective bargaining agreement, an arbitrator is to be chosen randomly from a list of nine people named in the agreement. One of the union’s representatives typed all nine names into a website, and an arbitrator was selected. The hotel refused to proceed, however, contending that the arbitrator should be disqualified because he was already arbitrating another dispute between the union and the hotel. When the union asked a federal court to compel arbitration, the hotel asked the judge to pick an arbitrator. The union and the employer usually chose arbitrators by mutual agreement or by striking names from the list until only one was left.

The first clause of 9 U.S.C. §5, provides that if an agreement provides a method of naming or appointing an arbitrator or arbitrators or an umpire, such method shall be followed. The district court determined that this clause covered this dispute. The district court did not perceive any “lapse” that would justify the judicial selection of an arbitrator. The fact that union and employer often deviated from the random-selection method did not change that method or make it inadequate.

The agreement specified a method of selection; it did not say that a person chosen for one dispute is disqualified from later disputes; and the hotel did not contend that a selection via random.org is anything other than random.

Public policy. Once the arbitrator made his decision, the hotel opposed confirmation on the grounds that the public policy of Illinois condemns violence in the workplace. However, the arbitrator did not see any violence, and a reviewing court cannot upset an arbitrator’s factual conclusions. The events were recorded by closed-circuit video. The arbitrator viewed the events as non-threatening even though the co-worker was frightened. The hotel’s management had known for some time that the employee carried this knife and took it out every so often but had never used it to injure (or confront) another worker.

Still, the employer observed, management called the police, who confiscated the knife because its blade exceeded the local limit for pocket knives. However, the employee was not charged with a crime or even issued a ticket.

The appeals court found a deeper problem with the employer’s position: a public policy against violence in the workplace is directed against those who employ violence, not against employers trying to choose the best methods of curtailing violence. The public policy of Illinois simply does not address how employers address actual or implicit threats of violence at work.

A hotel with the legal right to keep a worker on the payroll cannot complain when an arbitrator does exactly that.

Finding that there was nothing wrong with either the arbitrator’s selection or the substance of his decision, the appeals court confirmed the judgment of the arbitration award.

The case is No. 25-1265.

Judge: Easterbrook, F.

Attorneys: Wesley G.S. Kennedy (Allison, Slutsky & Kennedy) for Unite Here Local 1. Irving M. Geslewitz (Much Shelist) for Magnificent Mile Hotel Management, LLC dba Chicago Hotel Collection.

Companies: UNITE HERE Local 1; Magnificent Mile Hotel Management, LLC; Chicago Hotel Collection

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