UNITED STATES POSTAL SERVICE, PETITIONER V. NATIONAL ASSOCIATION OF LETTER CARRIERS, AFL-CIO No. 87-59 In the Supreme Court of the United States October Term, 1987 On Writ of Certiorari to the United States Court of Appeals for the District of Columbia Circuit Brief for the Petitioner TABLE OF CONTENTS Question Presented Opinions below Jurisdiction Statutory and regulatory provisions involved Statement Summary of the argument Argument: An arbitration award ordering the postal service to reinstate an employee who has been discharged for, and criminally convicted of, failing to deliver thousands of pieces of mail is contrary to public policy and hence not judicially enforceable A. The federal courts may not enforce an arbitration award that "compromises" an "explicit public policy" that is "well defined and dominant" in existing "laws and legal precedent" B. Reinstatement of Mr. Hyde would improperly compromise the statutorily-rooted public policy demanding the security of the mails C. Respondent has provided no persuasive reason for requiring the postal service to reinstate Mr. Hyde Conclusion OPINIONS BELOW The opinion of the court of appeals (Pet. App. 1a-6a) is reported at 810 F.2d 1239. The opinion of the district court (Pet. App. 7a-13a) is reported at 631 F. Supp. 599. JURISDICTION The judgment of the court of appeals (Pet. App. 25a-26a) was entered on February 13, 1987. A petition for rehearing was denied on April 9, 1987 (Pet. App. 27a). The petition for a writ of certiorari was filed on July 7, 1987, and was granted on December 14, 1987, limited to the second question presented in the petition. The jurisdiction of the Court rests on 28 U.S.C. 1254(1). STATUTORY AND REGULATORY PROVISIONS INVOLVED The pertinent statutory and regulatory provisions involved in this case are reprinted in an Appendix to this brief. QUESTION PRESENTED Whether an arbitration award ordering the Postal Service to reinstate an employee who has been discharged for, and criminally convicted of, failing to deliver thousands of pieces of mail should be set aside as contrary to public policy. STATEMENT 1. In June 1984, police and postal inspectors made a lawful search of the personal automobile of Edward Hyde, a letter carrier for petitioner, the United States Postal Service (Pet. App. 8a). They found more than 3,500 pieces of undelivered mail addressed to residents on Mr. Hyde's delivery route and elsewhere (ibid.). Some of the mail contained commercial and United States Treasury checks; some had been delayed for more than a year (ibid.). Mr. Hyde was immediately arrested and charged with unauthorized possession and unlawful delay of the mails, in violation of 18 U.S.C. 1703 (Pet. App. 8a). In September 1984, he pled guilty to the latter offense and was sentenced to 18 months' probation, a condition of which was that he complete a rehabilitation program for compulsive gamblers (ibid.). Because of his criminal dereliction of duty, Mr. Hyde was discharged by the Postal Service (Pet. App. 8a). Respondent, the National Association of Letter Carriers, AFL-CIO, filed a grievance on his behalf, arguing that the Postal Service was without "just cause" to discharge Mr. Hyde, as required by the collective bargaining agreement between the Postal Service and respondent (ibid.). /1/ In April 1985, an arbitrator ordered the Postal Service to reinstate Mr. Hyde without backpay after a 60-day medical leave of absence (id. at 14-24a). The arbitrator found that Mr. Hyde was a "compulsive gambler," that Mr. Hyde's unlawful delaying of the mails was related to his gambling disorder, and that Mr. Hyde was actively attempting to rehabilitate himself (id. at 21a-22a & n.*). Accordingly, while acknowledging that he was unable "to foretell what the future prospects of (Mr. Hyde's) rehabilitation may yield" (id. at 22a), that "(t)here is the threat of recurrence of misconduct" (id. at 23a), and that Mr. Hyde could not yet be returned to work (ibid.), the arbitrator ruled that the Postal Service should set aside its removal decision at the end of a 60-day period, provided that Mr. Hyde regularly attended and participated in Gamblers Anonymous meetings during the 60-day period, refrained from any gambling, and established that he was physically fit to work (id. at 23a-24a). The arbitrator explained: "if any reasonable hope exists for the rehabilitation of (Mr. Hyde) and the returning of him to the work place, no one should deny him this opportunity" (id. at 21a). 2. In July 1985, the Postal Service filed the instant action seeking to vacate the award (Pet. App. 9a). On the parties' cross-motions for summary judgment, the district court recognized that "the strong federal policy favoring arbitration of labor disputes results in 'extremely limited' judicial review of arbitrators' awards" (ibid. (citation omitted)). It noted, however, that "(q)ualifying this general rule of judicial deference * * * is an exception which operates when an arbitrator's decision contravenes the law or some other public policy of comparable stature" (ibid.). The court concluded that enforcement of the arbitral award reinstating Mr. Hyde in the case would contravene such a public policy, to wit, the Postal Service's statutory obligation to ensure the "prompt, reliable, and efficient" delivery of the mails (Pet. App. 10a-11a). It explained (id. at 11a-12a) that Mr. Hyde violated a public trust by failing to perform his own primary duty, viz., properly delivering the mail entrusted to him, and his conduct does no less mischief to the operation of the postal system simply because it originates in deficits of character arguably more forgiveable than cupidity. The inexorability of the mails, upon which literally millions depend daily, is equally compromised whether postal workers are derelict in their duties for reasons of avarice, indolence, or distractive vices such as gambling. The public policy which must prevail in such cases, when a choice must be made, is that which gives best assurance of an efficient and reliable postal service, and that policy is not one of deference to arbitral autonomy in individual grievance cases, no matter how conscientiously the arbitrator may have sought to match the penalty to the culpability of the offender. The Postal Service must retain the ability to remove postal employees it does not fully trust from positions vulnerable to breaches of trust; the mails are simply too important to the country to make them dependent upon the vicissitudes of rehabilitation of a single letter carrier. 3. The court of appeals reversed (Pet. App. 1a-6a). It first stated (id. at 4a) that, "(i)n the instant case, the Postal Service does not (indeed, cannot) maintain that the arbitrator acted outside the bounds of the parties' collective bargaining agreement," noting that the arbitrator "interpreted the contract in order to decide whether Hyde had been discharged for 'just cause,'" and that "(t)he arbitrator's judgment on this issue was precisely what the parties had bargained for." The court then noted that, while "an arbitration award may be set aside as violative of public policy in certain 'limited circumstances'" (ibid. (citation omitted)), it had previously held that the "public policy" exception must be narrowly construed in order to avoid potentially intrusive judicial review of arbitral awards and thus may be applied only where an arbitral award itself violates established law or seeks to compel unlawful conduct (id. at 4a-5a (citations omitted)). Finally, it held (id. at 5a-6a) that, "(i)n this case, there is * * * no basis for invoking the 'extremely narrow' public policy exception." The court declared that "(t)he Postal Service cannot identify any 'legal proscription against the reinstatement of a person such as (Mr. Hyde)'" and that it would not "'impose its own brand of justice' by holding that the reinstatement of Hyde is inconsistent with the public's interest in an efficient and reliable postal service" (ibid. (citations omitted)). 4. On May 21, 1987, the Chief Justice, acting as Circuit justice, granted the Postal Service's application for a stay of the court of appeals' mandate. The Chief Justice noted that the Postal Service "operates under a statutory mandate to ensure prompt delivery of the mails," that "(e)ven the temporary reinstatement of Hyde, a convicted criminal, will seriously impair the applicant's ability to impress the seriousness of the Postal Service's mission upon its workers," and that "(c)ontinuation of the status quo will not work an irreparable harm on Hyde, but will preserve the applicant's ability to carry out its legal obligations" (Pet. App. 30a, 31a). SUMMARY OF ARGUMENT A. This Court has long held that courts must treat an arbitrator's interpretation of a collective bargaining agreement as the last word on the intent of the contracting parties. The Court has also held, however, that, before enforcing an award, a court must determine that the award is consistent with "public policy." In making this "public policy" determination, the court may not rely on its own notions of the public good. Rather, a court may refuse to enforce an arbitration award only if its enforcement would "compromise" or "violate" some "explicit public policy" that is "well defined and dominant" in "existing laws and legal precedents." United Paperworkers Int'l Union v. Misco, Inc., No. 86-651 (Dec. 1, 1987), slip op. 12-13; W.R. Grace & Co. v. Rubber Workers, 461 U.S. 757, 766 (1983). While the precise contours of this doctrine can be discerned only by closely examining the Court's precedents, it is clear that an award is unenforceable if compliance with it would be inconsistent with a policy embodied in a federal statute, as properly interpreted by the courts or the agency charged with the statute's administration. B. The arbitration award in this case is unenforceable under this standard. It compromises a well-defined and dominant public policy rooted in existing statutes, regulations, and legal precedent -- i.e., the requirement that the Postal Service ensure the security and reliability of the public mails. The public has a vital interest in the security of the mails. In recognition thereof, Congress has commanded that the Postal Service "shall provide prompt, reliable, and efficient" mail services to the public, has created various civil and criminal sanctions to be imposed upon those (including Postal Service employees) who delay, destroy, disrupt, or misuse the mails, and has instructed the Postal Service to assist with the enforcement of these civil and criminal sanctions and otherwise to ensure that the security of the mails is maintained. The Postal Service, in turn, has devoted considerable attention and resources to the security of the mails -- by, for example, imposing on its employees a Code of Ethical Conduct which provides for the discharge of any employee who delays or disrupts the mails. These statutory and regulatory provisions plainly establish a "public policy" within the meaning of the Court's cases. Compliance with the arbitration award ordering Mr. Hyde's reinstatement would improperly compromise this public policy. Mr. Hyde failed over the course of a year to deliver more than 3,500 pieces of mail, conduct which resulted in a criminal conviction. Notwithstanding respondent's vigorous attempts to show that Mr. Hyde had been rehabilitated, an arbitrator found that there was a threat of recurrence of misconduct, that Mr. Hyde could not be returned to work for at least sixty days, and that he -- the arbitrator -- could not foretell when, if ever, Mr. Hyde would be fully rehabilitated. In these circumstances, the statutory requirement that the security of the mails be ensured precludes Mr. Hyde's reinstatement. As the district court stated (Pet. App. 12a), "the mails are simply too important to the country to make them dependent upon the vicissitudes of rehabilitation of a single letter carrier." C. In its memorandum in opposition, respondent union has argued that the Postal Service should be required to reinstate Mr. Hyde because his reinstatement is not legally proscribed, because the Postal Service may validly contract away its authority to decide whether Mr. Hyde should be reinstated, and because the Postal Service has no reasonable grounds for concluding that reinstatement presents a threat to the security of the mails. These arguments are without merit and misunderstand the public policy doctrine. While we agree that care must be taken so that the efficacy of the arbitral process will not be undermined, proper application of the public policy doctrine will not do so. Rather, it will reconcile that process with the public law obligations to which the Public Service is bound. 1. With respect to respondent's argument that Mr. Hyde's reinstatement is not legally proscribed, we believe that respondent has misunderstood the nature and scope of the Postal Service's statutory obligations. The Postal Service is statutorily required to ensure the security of the mails. Any action, such as Mr. Hyde's reinstatement, that would fundamentally impede or prevent the Postal Service from ensuring that the mails are secure is in fact legally proscribed. That the statute does not explicitly bar the Postal Service from employing an individual such as Mr. Hyde begs the question whether Mr. Hyde's reinstatement is inconsistent with the Postal Service's statutory obligation to ensure that the mails are reliable and secure. That a statute (or other applicable constraint of public policy) speaks in broad terms does not diminish its force as a statement of public policy; indeed, it would be strange if the most fundamental and important statutory constraint on the Postal Service were given less force precisely because of its sweeping scope. Likewise, the fact that Mr. Hyde's reinstatement would not subject the Postal Service to judicial sanction does not mean that it is not legally proscribed. Congress has expressly commanded the Postal Service to "provide prompt, reliable, and efficient" mail services and, more particularly, has enjoined it to protect the security of the mails; these statutory commands are as much legal obligations that the Postal Service is bound to honor as is a judicially enforceable requirement of positive law. 2. Nor is the Postal Service empowered to divest itself by contract of the discretion necessary to fulfill its statutory obligations. Congress has not merely given the Postal Service permission to deliver the mails; it has commanded that the Postal Service "shall provide prompt, reliable, and efficient" mail services. The language of this statutorily-rooted obligation is mandatory and unequivocal. Given the background against which Congress acted, in which public employers at all levels of government have traditionally been precluded from bargaining about their basic missions, this mandatory statutory language strongly indicates Congress's intent that the Postal Service, like other public employers, would not be free to contract away the irreducible statutory obligations imposed upon it. To be sure, when Congress enacted the Postal Service Reorganization Act, it determined that the principles governing the labor-management relations of the Postal Service were in need of significant reform and that the mechanisms used for structuring labor-management relations in the private-sector should generally be adopted for the Postal Service. At the same time, however, Congress expressed its understanding that the Postal Service would in many ways continue to operate as a traditional agency of government, that postal workers would continue to be government employees, and that the Postal Service and postal workers' bargaining representatives would be exempt from the requirements of the National Labor Relations Act (29 U.S.C. (& Supp. III) 151 et seq.) "to the extent (those requirements are) inconsistent with provisions of (the Postal Reorganization Act)" (39 U.S.C. 1209(a)). The provisions of the Act include the mandate requiring the Postal Service to ensure the security and reliability of the mails. The statutory scheme does not, of course, allow the Postal Service to use its statutory obligation as an excuse for refusing to comply with every arbitration award with which it does not agree. The statute recognizes collective bargaining and arbitration as the preferred means of resolving labor disputes. Accordingly, procedurally, the Postal Service may not bypass an applicable contractual grievance procedure and is bound by the arbitrator's factual findings therein. Moreover, substantively, the Postal Service may invoke its statutory mandate as a basis for challenging an arbitration award only where compliance with the award would seriously impair the core responsibilities of the Postal Service. These procedural and substantive limitations on the Postal Service's resort to the public policy doctrine are necessary to accommodate the statute's commitment to collective bargaining and arbitration. Nevertheless, to preserve the Postal Service's statutory mandate, the courts must also refuse, as they would refuse in any public policy case, to enforce an arbitration award that is fundamentally inconsistent with the Postal Service's irreducible statutory obligation to ensure the prompt, reliable, and efficient delivery of the mails and, more particularly, to ensure the security of the mails. The "public policy" question presented to the courts in such a case is, however, different in one important respect from the public policy question that courts typically face in cases involving private-sector employers and unions. The Postal Service is the expert government agency charged with enforcement of the very public policy that is at issue here. Its determination that compliance with an arbitration award would be inconsistent with its statutory obligations is therefore entitled to some deference. The question for the courts in such a case, as contrasted with the typical public policy case, is not whether the statute is best read as overriding the arbitration award. Rather, the question is whether the statute may permissibly be read to override the award -- that is, whether the Postal Service has established that it has reasonably concluded that noncompliance with the award is necessary to achievement of its irreducible statutory obligations. That standard has been satisfied here. 3. Finally, contrary to respondent's suggestion, Mr. Hyde has not been found to have been rehabilitated and thus it was not unreasonable for the Postal Service to conclude that Mr. Hyde's reinstatement would fundamentally impair its statutory obligation to ensure the security of the mails. The afrbitrator found that there was a threat of recurrence of misconduct; that Mr. Hyde was not yet ready to return to work; and that, although Mr. Hyde was enrolled in a Gamblers Anonymous program, it is unclear whether he would ever be fully rehabilitated. Accordingly, the Postal Service was entitled to oppose Mr. Hyde's reinstatement on public policy grounds. ARGUMENT AN ARBITRATION AWARD ORDERING THE POSTAL SERVICE TO REINSTATE AN EMPLOYEE WHO HAS BEEN DISCHARGED FOR, AND CRIMINALLY CONVICTED OF, FAILING TO DELIVER THOUSANDS OF PIECES OF MAIL IS CONTRARY TO PUBLIC POLICY AND HENCE NOT JUDICIALLY ENFORCEABLE The court below erred in holding that the arbitration award ordering the Postal Service to reinstate Mr. Hyde should not be set aside. Even if we assume that the award draws its essence from the collective bargaining agreement between the Postal Service and respondent, the award is inconsistent with the paramount public policy requiring that the security of the mails be maintained. This public policy, which is embodied and delimited in the statutes and regulations requiring the Postal Service to ensure that the mails are promptly, reliably, and efficiently delivered, and punishing those who delay or disrupt the mails, is improperly compromised by an arbitration award reinstating to a letter carrier position an individual (a) who has been criminally convicted of failing to deliver thousands of pieces of mail and (b) whom the Postal Service reasonably perceives to pose an undue risk that he may again mishandle the mails is reinstated. The Postal Service's mandate to ensure the reliable and efficient delivery of the mails simply does not allow it to expose the mails to such security risks. Accordingly, it is both reasonable and necessary for the Postal Service to refuse to comply with the arbitration award ordering Mr. Hyde's reinstatement. A. The Federal Courts May Not Enforce An Arbitration Award That "Compromises" An "Explicit Public Policy" That Is "Well Defined And Dominant" In Existing "Laws And Legal Precedent" 1. The Court has long recognized that the federal statutes regulating our nation's labor policy, including the statutes regulating the labor-management relations of the Postal Service, evidence a strong commitment to the settlement of labor disputes through arbitral processes. See AT&T Technologies, Inc. v. Communications Workers, 475 U.S. 643, 649-650 (1986); Bowen v. United States Postal Service, 459 U.S. 212, 224-226 (1983). /2/ The Court has accordingly held that the federal courts "are not authorized to reconsider the merits of an award even though the parties may allege that the award rests on errors of fact or misinterpretation of the contract." United Paperworkers Int'l Union v. Misco, Inc., No. 86-651 (Dec. 1, 1987), slip op. 6. See also Steelworkers v. American Mfg. Co., 363 U.S. 564, 567-568 (1960). Rather, the Court has said, courts must treat any arbitration award that "draws its essence from the collective bargaining agreement" as the contractual agreement of the parties. Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593, 597 (1960); see generally AT&T Technologies, Inc. v. Communications Workers, 475 U.S. at 648-651. That courts must treat an arbitrator's interpretation of a collective bargaining agreement as the last word on the intent of the contracting parties, however, does not automatically require -- or authorize -- the courts to enforce every award as rendered by the arbitrator. Even if an award draws its essence from the collective bargaining agreement, the courts have a duty to determine whether the award is consistent with a "public policy" before enforcing it. See W.R. Grace & Co. v. Rubber Workers, 461 U.S. 757, 766 (1983); Kaiser Steel Corp. v. Mullins, 455 U.S. 72, 83-84 (1982); Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 583 (1960). The Court has long held that "(t)he power of the federal courts to enforce the terms of private agreements is at all times exercised subject to the restrictions and limitations of the public policy of the United States as manifested in the Constitution, treaties, federal statutes, and applicable legal precedents. Where judicial enforcement of private agreements would be violative of that policy, it is the obligation of courts to refrain from such exertions of judicial power." Hurd v. Hodge, 334 U.S. 24, 34-35 (1948) (footnote omitted). The rule against enforcing arbitration awards arising out of collective bargaining agreements because they are contrary to "public policy" is merely an application of this more general doctrine. Misco, Inc., slip op. 12; W.R. Grace & Co., 461 U.S. at 766. See also Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 212 (1985). Of course, the federal statutes regulating labor-management relations, like the common law regulating contracts, generally favor the freedom of parties to establish the terms and conditions of their agreements without the intervention of government. Misco, Inc., slip op. 7; see generally H.K. Porter Co. v. NLRB, 397 U.S. 99, 108 (1970); NLRB v. Insurance Agents, 361 U.S. 477, 488 (1960); Teamsters v. Oliver, 358 U.S. 283, 295 (1959). Accordingly, the public policy exception to the enforcement of arbitration awards, like the public policy exception to the enforcement of contracts generally, is not a license for courts to override private agreements based on their own notions of the public good. A court may not refuse to enforce an arbitration award on the basis of some public policy ascertained by reference to "general considerations of supposed public interests" (W.R. Grace & Co., 461 U.S. at 766, quoting Muschany v. United States, 324 U.S. 49, 66 (1945)). Rather, the public policy exception "is limited to situations where the contract as interpreted would violate 'some explicit public policy' that is 'well defined and dominant'" in "existing laws and legal precedents" (Misco, Inc., slip op. 12-13 (quoting W.R. Grace & Co., 461 U.S. at 766)) -- for example, in "the constitution, laws, and judicial decisions of that State and as well the applicable principles of the common law" (Twin City Pipe Line Co. v. Harding Glass Co., 283 U.S. 353, 357 (1931)). See UMWA Health & Retirement Funds v. Robinson, 455 U.S. 562, 576 (1982); see also Hurd v. Hodge, 334 U.S. at 34-35 ("The power of the federal courts * * * is at all times exercised subject to the restrictions and limitations of the public policy of the United States as manifested in the Constitution, treaties, federal statutes, and applicable legal precedents."); cf. Muschany v. United States, 324 U.S. at 66-67 ("In the absence of a plain indication of (dominant public) policy through long governmental practice or statutory enactments, or of violations of obvious ethical or moral standards, this Court should not assume to declare contracts of the War Department contrary to public policy."). When these strict requirements are met, however, courts have a duty to refrain from enforcing an arbitration award as contrary to the public policy of the United States. W.R. Grace & Co., 461 U.S. at 766; Kaiser Steel Corp. v. Mullins, 455 U.S. at 83-84. 2. A number of this Court's decisions illustrate the contours of the public policy doctrine. Most recently, in United Paperworkers Int'l Union v. Misco, Inc., supra, the Court reversed a judgement that had vacated on public policy grounds an arbitration award ordering the reinstatement of an employee whose car on company premises contained traces of marijuana. After ruling that the lower courts had improperly failed to defer to the arbitrator's factual findings and contract interpretation (slip op. 8-11), the Court determined that the lower courts had also erred in their application of the public policy doctrine, both in defining a relevant public policy and in finding it compromised on the facts of the case. First, the Court said that the lower courts had improperly "made no attempt to review existing laws and legal precedents in order to demonstrate that they establish a 'well defined and dominant' policy against the operation of dangerous machinery while under the influence of drugs" (Misco, Inc., slip op. 13). The Court agreed that "such a judgment is firmly rooted in common sense," but reiterated that such "a formulation of public policy based only on 'general considerations of supposed public interests' is not the sort that permits a court to set aside an arbitration award that was entered in accordance with a valid collective-bargaining agreement" (ibid.). Second, the Court held that, even if this "formulation of public policy is to be accepted, no violation of that policy was clearly shown in this case" (ibid.). It found that "the assumed connection between the marijuana gleanings found in (the employee's) car and (his) actual use of drugs in the workplace is tenuous at best and provides an insufficient basis for holding that his reinstatement would actually violate the public policy * * * 'against the operation of dangerous machinery by persons under the influence of drugs or alcohol'" (slip op. 14 (citation omitted)). By contrast, where compliance with an arbitration award would in fact conflict with federal law, as interpreted by an appropriate agency or court, the Court has said that it will not hesitate to vacate the award. In Carey v. Westinghouse Electric Corp., 375 U.S. 261 (1964), for example, the Court held that an arbitration award that conflicts with an interpretation of the National Labor Relations Act by the National Labor Relations Board may not be enforced. The collective bargaining agreement in that case required the employer to recognize the union as the exclusive bargaining representative for Board-certified units of employees, expressly including "production and maintenance" employees, but excluding "technical" employees. A dispute arose over whether certain employees in the technical engineering laboratory were performing maintenance work. The Court held that the dispute was arbitrable, rejecting the employer's contention that the representation controversy was within the exclusive jurisdiction of the Board. The Court also ruled, however, that the courts could not enforce the arbitration award if the award conflicted with a subsequent ruling by the Board: "Should the Board disagree with the arbiter, by ruling, for example, that the employees involved in the controversy are members of one bargaining unit or another, the Board's ruling would, of course, take precedence; and if the employer's action had been in accord with the ruling, it would not be liable for damages under (Section) 301" of the statute (375 U.S. at 272). See also Kaiser Steel Corp. v. Mullins, 455 U.S. 72 (1982) (collective bargaining agreement that conflicts with provision or policy of the National Labor Relations Act, as interpreted by the courts, is unenforceable). In between Misco and Carey is W.R. Grace & Co. v. Rubber Workers, supra, which involved an arbitration award ordering the payment of damages to individuals who had been deprived of collectively-bargained seniority rights by a conciliation agreement between the Equal Employment Opportunity Commission (EEOC) and their employer (but not their union), which a district court had ordered the employer to follow. The Court recognized that the award implicated two "well-defined and dominant" public policies -- (a) the policy requiring obedience to judicial orders, and (b) the policy favoring voluntary compliance with the requirements of Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e et seq. The Court agreed (461 U.S. at 766) that courts may not enforce arbitration awards that would lead persons to disobey injunctions issued by courts acting within their jurisdiction; and it said (id. at 770-771) that they may not require persons to comply with arbitration awards that discourage conciliation and cooperation with respect to federal employment discrimination claims. Nonetheless, the Court held that neither of those policies had been sufficiently "compromise(d)" by the arbitration award issued in the case to justify its judicial non-enforcement. The award neither created "intolerable incentives to disobey court orders," since it required only the payment of damages (id. at 769), nor undermined "true conciliation between all interested parties," since the union was not party to the conciliation agreement (id. at 771). Misco, Inc., Carey, and W.R. Grace & Co. illustrate that, while the public policy exception is not a "broad judicial power to set aside arbitration awards" (Misco, Inc., slip op. 13), it is an important restraint on the power of individual parties (and the arbitrators who interpret their agreements) to contravene the Constitution, laws, and legal precedents of the United States. Whatever the precise limits of the doctrine, it is clear that the courts will not enforce an arbitration award that is inconsistent with a policy embodied in a federal statute or precedent, as interpreted by the courts or the agency charged with the law's enforcement. See also Alexander v. Gardner-Denver Co., 415 U.S. 36, 44-45 (1974); McDonald v. City of West Branch, 466 U.S. 284, 290-291 (1984). "(T)he aid of the court is denied, not for the benefit of the (moving party), but because public policy demands that it should be denied without regard to the interests of individual parties." Continental Wall Paper Co. v. Louis Voight & Sons Co., 212 U.S. 227, 262 (1909). See also Kaiser Steel Corp. v. Mullins, 455 U.S. at 77-78, 83-84; Hurd v. Hodge, 334 U.S. at 34-35; McMullen v. Hoffman, 174 U.S. 639, 669 (1899). B. Reinstatement of Mr. Hyde Would Improperly Compromise The Statutorily-Rooted Public Policy Demanding The Security Of The Mails The question for decision in this case, therefore, has two components: first, whether the arbitration award implicates a "well-defined and dominant" public policy that exists in "law and legal precedents"; and, second, whether compliance with the award -- and, therefore, its judicial enforcement -- would improperly "compromise" that public policy. We submit that both questions must be answered in the affirmative. 1. As the district court recognized (Pet. App. 11a-12a), an important public policy is implicated by the arbitration award in this case -- i.e., the public's vital interest in the security of the mails. Millions depend on the mails every day. Important ideas and information are exchanged through the mails. See Lamont v. Postmaster General, 381 U.S. 301 (1965) (security of the mails fosters important First Amendment values) Businesses use the mails to conduct many of their transactions. Government relies on the mails to deliver benefits to needy persons, to collect taxes, and to conduct numerous official activities. By express legal authority, courts and litigants rely on the mails for the efficient and fair conduct of the nation's judicial business. See, e.g., Sup. Ct. R. 28; Fed. R. App. P. 3; Fed. R. Civ. P. 5(b), 77(d). Our economic, social, political, and legal systems are premised on the assumption that the mails will be secure. See generally U.S. Const. Art. 1, Section 8 (Congress is granted the power "(t)o establish Post Offices and post Roads"); United States Postal Service v. Greenburgh Civic Ass'ns, 453 U.S. 114, 120-122, 123-124 (1981); Ex parte Jackson, 96 U.S. 727, 732 (1878). Congress has recognized and sought to protect the public's special interest in the security of the mails in a variety of ways. In colonial times, Congress authorized the Postmaster General, the first of whom was Benjamin Franklin, to use surveyors -- the forerunners of today's Postal Inspectors -- to protect the mails. See Act of Mar. 2, 1799, ch. 43, 1 Stat. 733; see generally United States Postal Service v. Greenburgh Civic Assn's, 453 U.S. at 121. In more modern times, Congress has granted the Postal Service a limited monopoly power over the mails (39 U.S.C. 601) and has imposed upon it "the obligation to provide postal services to bind the Nation together through the personal, educational, literary, and business correspondence of the people" (39 U.S.C. 101(a)). Specifically, Congress has mandated that the Postal Service "shall provide prompt, reliable, and efficient services to patrons in all areas * * * " (39 U.S.C. 101(a)) and has instructed that, "(i)n determining all policies for postal services, the Postal Service shall give the highest consideration to the requirement for the most expeditious collection, transportation, and delivery of important letter mail" (39 U.S.C. 101(e)). See also 39 U.S.C. 403(a) ("The Postal Service shall plan, develop, promote, and provide adequate and efficient postal services * * * . The Postal Service shall serve as nearly as practicable the entire population of the United States."); 39 U.S.C. 403(b) ("It shall be the responsibility of the Postal Service * * * to maintain an efficient system of collection, sorting, and delivery of the mail nationwide."). Moreover, to ensure the security of the mails, Congress has imposed a variety of civil and criminal sanctions on those -- specifically including Postal Service employees -- who delay, disrupt, destroy, or misuse the mails. See 18 U.S.C. 500-503, 1341, 1700-1703, 1708-1709; 39 U.S.C. 5206, 5403, 5604. Significantly, Congress has incorporated the criminal provisions of Title 18 relating to the mails into the Postal Reorganization Act itself. See 39 U.S.C. 410(b)(2). The Postal Service, in turn, devotes considerable attention (pursuant to statute) to the public's interest in the security of the mails. It runs the Postal Inspection Service, which is actively involved in the investigation of mail delays and disorders. See 39 U.S.C. 404(7), 603, 3003. In addition, the Postal Service levies fines on carriers that unreasonably delay or disrupt the mails. See 39 U.S.C. 5206, 5403, 5604. Moreover, as we have noted, the Postal Service participates in the investigation and criminal prosecution of individuals who are found to have disrupted the mails -- including postal service employees. See 39 U.S.C. 410(b)(2). It also imposes a strict Code of Ethical Conduct on its employees. See 39 C.F.R. Pt. 447. Among other things, this Code of Ethical Conduct expressly reiterates that the "Prohibition against Delay or Destruction of Mail or Newspapers (18 U.S.C. 1703)" (39 C.F.R. 447.91(q)) is "applicable to all employees in the Postal Service" (39 C.F.R. 447.91). It further provides: "(n)o employees shall engage in criminal, dishonest, notoriously disgraceful or immoral conduct, or other conduct prejudicial to the Postal Service. Conviction of a violation of any criminal statute may be grounds for disciplinary action by the Postal Service in addition to any other penalty imposed by or pursuant to statute." 39 C.F.R. 447.25(c). These statutory and regulatory provisions plainly establish a "public policy" within the meaning of this Court's cases. Like the public policies favoring obedience to judicial orders and voluntary compliance with the requirements of Title VII, which were at issue in W.R. Grace & Co. v. Rubber Workers, supra, the public interest in the security of the mails is embodied in "existing laws and legal precedent" -- i.e., in the statutes requiring the Postal Service to ensure that the mails are "promptly, reliably, and efficiently" delivered. See United States Postal Service v. American Postal Workers Union, 736 F.2d 822, 825 (1st Cir. 1984); see also United States Postal Service v. Greenburgh Civic Ass'ns, 453 U.S. at 122-123. And, again like the public policies at issue in W.R. Grace & Co. v. Rubber Workers, supra, the public interest in the security of the mails is "well-defined and dominant"; the "public interest in the protection of the safety of the mail * * * (is) of great governmental postal service urgency" (United States v. Bunkers, 521 F.2d 1217, 1219 (9th Cir.), cert. denied, 423 U.S. 989 (1975)), as is further evidenced by the civil and criminal statutes and Postal Service regulations we have described. See also National Rural Letter Carriers Ass'n v. United States Postal Service, 637 F. Supp. 1041, 1044 (D.D.C. 1986). In short, there can be no doubt that the public policy at issue here is not one sought to be created by the courts' imposition of their own notions of the public good; the public policy demanding the security of the mails is firmly rooted in an interrelated series of legislative and administrative enactments. 2. The arbitration award ordering Mr. Hyde's reinstatement improperly compromises this public policy. The mails are not secure when they are placed in the hands of an individual whom the Postal Service reasonably perceives to pose an undue risk that he may mishandle them. The Postal Service could quite properly conclude that Mr. Hyde is such an individual. He failed over the course of a year to deliver more than 3,500 pieces of mail, including Treasury checks on which numerous individuals may vitally depend. In doing so, he violated not merely a work-rule of the Postal Service, but a federal criminal statute. Moreover, he did not attempt to solve the "compulsive gambling" problem that he offered as an excuse for his criminal misconduct until after he had been convicted. And, although he had begun attending Gamblers Anonymous meetings by the time the arbitration award was rendered, the Postal Service did not, at that time, have sufficient basis for confidence that Mr. Hyde would not again grossly delay and jeopardize the mails. Though respondent vigorously attempted to demonstrate Mr. Hyde's rehabilitation, the arbitrator found that "(t)here (was) the threat of recurrence of misconduct," that Mr. Hyde was not yet fit to return to work, and that that arbitrator could not, even in a more general sense, "foretell what the future prospects of (Mr. Hyde's) rehabilitation may yield" (Pet. App. 23a, 22a). In these circumstances, the Postal Service's statutory obligation to ensure the security of the mails precluded it from reinstating Mr. Hyde and exposing the public to the concomitant risk. As the district court stated (Pet. App. 12a), "the mails are simply too important to the country to make them dependent upon the vicissitudes of rehabilitation of a single letter carrier." Moreover, reinstating Mr. Hyde would seriously compromise the Postal Service's statutory obligations in ways that extend significantly beyond the delays or disruptions of the mails that Mr. Hyde individually might cause. As Chief Justice Rehnquist noted in his opinion granting the Postal Service's application for a stay, compliance with the arbitration award would "seriously impair (the Postal Service's) ability to impress the seriousness of the Postal Service's mission upon its workers" (Pet. App. 30a-31a). In addition, it would undermine public confidence in the Postal Service's dedication to its statutorily-assigned task -- and, indeed, in the very security and reliability of the mails. See Johnson v. United States Postal Service, 756 F.2d 1461, 1466 (9th Cir. 1985) ("the Postal Service was properly concerned about public confidence in the rural mail delivery system"); Abbruzzese v. Berzak, 412 F. Supp. 201, 204 (D.N.J. 1978), aff'd, 601 F.2d 107 (3d Cir. 1979) ("The public is entitled to place high reliance on the honesty and integrity of postal employees; they handle papers and property of others which are important to sender and addressee. Trust and confidence are essential to the working of the Service."). See generally Connick v. Myers, 461 U.S. 138, 152, 154 (1983); Cornelius v. NAACP Legal Defense & Educational Fund, Inc., 473 U.S. 788, 810 (1985). 3. The First Circuit reached basically the same conclusion we urge here in United States Postal Service v. American Postal Workers Union, 736 F.2d 822 (1984). In that case, the Postal Service discovered that a window clerk in one of its offices had embezzled approximately $4,325.00 in postal service funds. The employee pleaded guilty to violating 18 U.S.C. 500 and received a one-year suspended criminal sentence. When the Postal Service attempted to discharge the employee, the employee's union filed a grievance on his behalf and an arbitrator ruled the Postal Service was without "just cause" to discharge him. The arbitrator ruled that the Postal Service should simply have transferred the employee to another position in that office. The First Circuit overturned that award, holding that the award improperly compromised the public's interest in the security of the mails. It explained (736 F.2d at 825) that putting a postal employee in a job removed from stamps and money does not remove his chances of violating the public trust. Any postal position which handles mail is one entrusted with items of importance and value by the public. * * * If the Postal Service did not have confidence in an employee's trustworthiness(,) it would be, at a minimum, negligent to not keep close watch on him. Such close supervision as might be prudent could well be too costly to be even remotely efficient. Aside from any considerations bearing directly on (the grievant), we cannot avoid the common sense implications that requiring the rehiring of (the grievant) would have on other postal employees and on the public in general. Other postal employees may feel there is less reason for them to be honest than they believed -- the Union could always fix it if they were caught. Moreover, the public trust in the Postal Service, and in the entire federal government, could be diminished by the idea that graft is condoned. The same reasoning and conclusions apply here with special force: the only reinstatement available (since the arbitration award was pursuant to an agreement for a bargaining unit confined to letter carriers) was to the position of letter carrier, a position that would require unsupervised handling of the mails on a day-to-day basis. 4. That reinstating Mr. Hyde would be contrary to public policy does not mean that the Postal Service is forbidden to employ as a letter carrier (or as an employee generally) any person who has been convicted of a crime, even a crime against the mails. Neither the Postal Reorganization Act (39 U.S.C. (& Supp. III) 101 et seq.) nor its implementing regulations create a policy barring the employment of ex-convicts. Indeed, the Act expressly states that, "(t)he Postal Service shall follow an employment policy designed, without compromising the policy of section 101(a) of this title, to extend opportunity to the disadvantaged and the handicapped" (39 U.S.C. 1003(b) (emphasis added)), which might conceivably include some persons with disorders that once resulted in criminal behavior. To maintain consistency with the policy of Section 101(a), however, any such employment policy would have to ensure the security of the mails. An arbitration award that requires the Postal Service to employ an individual whom it reasonably perceives to pose an undue risk of delaying or jeopardizing the mails does not meet this requirement. Accord United States Postal Service v. American Postal Workers Union, 736 F.2d at 825. At least where, as here, there has been no clear and unquestionable rehabilitation, the Postal Service has reasonable grounds for concluding that the security of the mails would be threatened. See Pet. App. 22a ("The Arbitrator is not able to foretell what the future prospects of the Grievant's rehabilitation may yield."); id. at 23a ("There is the threat of recurrence of misconduct."). Accordingly, public policy requires that the courts refuse to enforce the arbitrator's reinstatement order. C. Respondent Has Provided No Persuasive Reason For Requiring The Postal Service To Reinstate Mr. Hyde In its memorandum in opposition, respondent union argued that reinstatement is not legally proscribed, that the Postal Service may validly contract away its authority to decide whether Mr. Hyde should be reinstated, and that the Postal Service has no reasonable grounds for concluding that reinstatement presents a threat to the security of the mails. As we show below, these arguments are without merit. But, at the outset, we note that, to the extent these arguments rest on concerns that the public policy doctrine not be so broadened as to deter use of the arbitral system as the ordinary means for resolving disputes under the collective bargaining agreement, the Postal Service shares those concerns. The Postal Service is committed to the arbitral process and to relying on it for the resolution of its contractual disputes. In our view, however, this case is no longer a simple contractual dispute. It is now a dispute concerning whether the Postal Service is free to ignore its statutory obligations. Allowing the public policy doctrine to play its essential, albeit carefully circumscribed, role in these rare situations where compliance with an award cannot be reconciled with statutory duties will not undermine either the law's or the Postal Service's commitment to arbitration. See Misco, Inc., slip op. 11-13; W.R. Grace & Co. v. Rubber Workers, 461 U.S. at 766. Rather, it will respect the constraints that public law -- in this case, the statutory scheme defining the Postal Service's mission and obligations -- places on contracting parties and thus on the effectiveness of arbitral awards under their contracts. In short, refusing to enforce the award in this case does not deny the arbitral system the full measure of deference it is due. On that note, we turn to respondent union's specific arguments in support of their contrary theme. 1. Echoing the court of appeals (Pet. App. 5a-6a), respondent first argued (Memo. for Resp. 1-2) that the "public policy" exception is inapplicable in this case because there is "no legal proscription" against Mr. Hyde's reinstatement. This argument misunderstands the nature of the Postal Service's statutory obligations as well as the requirements of the public policy doctrine itself. In contrast to private employers, who generally define their own missions, the Postal Service derives its mission from statute. The Postal Reorganization Act requires the Postal Service to ensure that the mails are "promptly, reliably, and efficiently" delivered; and, as we have set forth in some detail, the Postal Service is required, as part of this basic mission, to ensure the security of the mails, a statutory imperative which is reinforced by the strong civil and criminal sanctions Congress has imposed on those who cause the mails to be delayed or disrupted. See 39 U.S.C. 101(a), 101(e), 403(a), 403(b), 410(b)(2); see also 18 U.S.C. 500, 1700-1703, 1705-1708; 39 C.F.R. Pt. 447. This statutorily rooted obligation is legally enjoined on the Postal Service and the Postal Service is not free to relinquish it. Nor is it free to bargain its mission away, as a private employer may bargain away its self-selected mission. Thus, contrary to respondent's argument, any Postal Service action, such as compliance with an arbitral reinstatement award like the one at issue here, that fundamentally impedes or threatens the security of the mails, and hence the accomplishment of the Postal Service's irreducible statutory mission, is in fact legally proscribed. /3/ Respondent suggested (Memo for Resp. 2) that the award is not subject to legal proscription because the statute does not explicitly bar the Postal Service from employing an individual such as Mr. Hyde. But this suggestion begs the question whether Mr. Hyde's reinstatement is inconsistent with the Postal Service's statutory obligations. If the Postal Service has reasonably concluded that Mr. Hyde's reinstatement would indeed pose an undue risk to the security of the mails, reinstatement would in fact be inconsistent with the statute's explicit requirement that the Postal Service "shall provide prompt, reliable, and efficient" mail services, as understood in light of the statutory and administrative requirements that the security of the mails be preserved. Cf. Carey v. Westinghouse Electric Corp., 375 U.S. at 272 (arbitration award that is inconsistent with National Labor Relations Act, as interpreted, may not be enforced). The fact that a statutory mandate (or other applicable constraint of public policy) is couched in broad terms that are not self-defining in no way diminishes its force as a statement of public policy. See W.R. Grace & Co. v. Rubber Workers, 461 U.S. at 769, 771 (suggesting that arbitration award would have been unenforceable if the award has created "intolerable incentives to disobey court orders" or had undermined "true conciliation between all interested parties," two policies which the Court derived by interpretation); Kaiser Steel Corp. v. Mullins, 455 U.S. at 77-85 (collective bargaining agreement held unenforceable because contrary to Section 1 of the Sherman Act, 15 U.S.C. 1, and Section 8(e) of the National Labor Relations Act, 29 U.S.C. 158(e), two statutes written in broad terms). Indeed, it would be strange if the most fundamental and important statutory constraint on the Postal Service were given less force precisely because of its sweeping scope. Respondent further suggested (Memo for Resp. 2) that the arbitration award is not legally proscribed because Mr. Hyde's reinstatement would not subject the Postal Service to judicial sanction. But this suggestion confuses the legal obligations of the Postal Service with the means of enforcing those legal obligations. It seems quite true that no court could order the Postal Service to discharge an employee like Mr. Hyde: No individual would have standing under the provisions of the statute authorizing suit against the Postal Service to challenge the Postal Service's decision not to discharge another person (39 U.S.C. 401(1), 408(b)), and, for reasons that are not pertinent here, Congress has chosen to make the Postal Service's execution of its statutory mandate generally immune from review under the Administrative Procedure Act, 5 U.S.C. 701 et seq. (39 U.S.C. 401(a)). The absence of direct judicial sanction, however, does not mean that the Postal Service is free from legal obligations. Congress has expressly commanded that the Postal Service "shall provide prompt, reliable, and efficient" mail services and, more particularly, has enjoined it to protect the security of the mails. These statutory commands, which are in any event enforceable through the appropriations and other congressional oversight processes, are as much legal obligations that the Postal Service is bound to honor as is a judicially enforceable requirement of positive law. See Kaiser Steel Corp. v. Mullins, 455 U.S. at 77-86; United States v. Richardson, 418 U.S. 166, 176-180 (1974). Thus, it does not follow that there is no "legal proscription" against respondent's reinstatement simply because his reinstatement would not subject the Postal Service to judicial sanction. 2. Respondent also argued (Memo. for Resp. 3-10) that the Postal Service is empowered to divest itself by contract of the discretion necessary to fulfill its statutory obligations and, accordingly, that the Postal Service cannot rely on its statutory mandate in challenging the arbitration award at issue here. This argument, however, ignores the Postal Service's statutory scheme and proposes a grossly unbalanced solution to the delicate problem of accommodating the statutorily-rooted commitment to arbitration with the overriding commands of the statutorily-rooted public policy demanding the security of the mails. a. Congress has not merely given the Postal Service permission to deliver the mails in a prompt, reliable, and efficient manner. Rather, Congress has commanded that the Postal Service "shall provide prompt, reliable, and efficient services to patrons in all areas * * * " (39 U.S.C. 101(a) (emphasis added)). Indeed, it has instructed that, "(i)ndetermining all policies for postal services, the Postal Service shall give the highest consideration to the requirement for the most expeditious collection, transportation, and delivery of important letter mail" (39 U.S.C. 101(e) (emphasis added)). See also 39 U.S.C. 403(a) (emphasis added) ("The Postal Service shall plan, develop, promote, and provide adequate and efficient postal services * * * . The Postal Service shall serve as nearly as practicable the entire population of the United States."); 39 U.S.C. 403(b) (emphasis added) ("It shall be the responsibility of the Postal Service * * * to maintain an efficient system of collection, sorting, and delivery of the mail nationwide"). The language of these statutory requirements is "mandatory and unequivocal." Rodriguez v. Compass Shipping Co., 451 U.S. 596, 602 (1981). Having used "the imperative voice" (Califano v. Yamasaki, 442 U.S. 682, 693 (1979) (footnote omitted)), Congress cannot be understood as having intended that the Postal Service would nevertheless be free to waive its statutory obligations by contract, to reorder the priorities established for it by statute, or to divest itself of the discretion necessary to carry out its statutory mandate. On the contrary, Congress unmistakably conferred upon the Postal Service "a governmental mission which may not be compromised or negotiated away, in whole or in part, at the bargaining table" or in the arbitral process. AFGE v. FLRA, 730 F.2d 1534, 1539 (D.C. Cir. 1984). Indeed, in mandating that the Postal Service "shall provide prompt, reliable, and efficient" mail services and, more particularly, that the Postal Service shall secure the mails, Congress acted against a background in which public employers at the federal, state, and local levels traditionally have been precluded from bargaining about their basic mission or from complying with contractual commitments or arbitration awards that undermine that mission's irreducible core. See Craver, The Judicial Enforcement of Public Sector Grievance Arbitration, 58 Tex. L. Rev. 329, 333-339, 350-352 (1980); Wellington & Winter, The Limits of Collective Bargaining in Public Employment, 78 Yale L.J. 1107, 1108-1111, 1125-1127 (1969); Developments in the Law -- Public Employment, 97 Harv. L. Rev. 1611, 1684-1696, 1718-1724 (1984). These constraints reflect fundamental differences between public and private employers. First, the legislative assignment of legal power is made exclusively to the public employer, whose governing officials are selected and held publicly accountable in carefully defined ways. Thus, under sovereignty and non-delegation principles, the public employer is not allowed to delegate control over its legal powers and obligations to nongovernmental groups (such as arbitrators) through the bargaining process. See Craver, supra, 58 Tex. L. Rev. at 338-341; Developments, supra, 97 Harv. L. Rev. at 1692-1693); see also Ridgefield Park Education Ass'n v. Board of Education, 78 N.J. 144, 163, 393 A.2d 278, 287 (1978) ("the true managers are the people" and "governmental bodies (must) retain their accountability to the citizenry"). Second, public employers are not free to cease providing statutorily-mandated services -- i.e., they cannot "lock out" employees. Accordingly, even when employees are barred from striking, public employers are oftentimes less able than private employers to resist unreasonable union bargaining demands and therefore by law are not allowed to make certain contractual commitments. See Wellington & Winter, supra, 78 Yale L.J. at 1119-1123. /4/ The Postal Service is a public employer that is both entrusted with such carefully delegated governmental powers and confined by such practical constraints on its bargaining powers. See 39 U.S.C. 101, 202, 401, 402, 403. Indeed, Congress has specifically charged a Board of Governors with the obligation to direct "(t)he exercise of the power of the Postal Service" (39 U.S.C. 202(a)) and has expressly provided that any delegations of authority by the Board "shall not relieve (it) of full responsibility for the carrying out of its duties and functions, and shall be revocable by the Governors in their exclusive judgment" (39 U.S.C. 402). And, of course, the Postal Service's continuing obligation to deliver the mails precludes it from locking its employees out and shutting down its operations altogether. 39 U.S.C. 101. Since Congress has at no time indicated that it views the legal and practical constraints generally confining public employers as any less applicable to the Postal Service, there is no basis for concluding that the Postal Service, any more than other public employers, is free to contract away the irreducible obligations imposed upon it by Congress in mandatory statutory language. b. To be sure, as respondent noted (Memo. for Resp. 3-7), when Congress enacted the Postal Reorganization Act, it determined that the principles governing the labor-management relations of the Postal Service were in need of significant reform and that the mechanisms used for structuring labor-management relations in the private sector should generally be adopted by the Postal Service. Congress thus authorized the Postal Service to enter into collective bargaining agreements with the representatives of postal workers (39 U.S.C. 1206(a)); approved the use of binding arbitration as a means of resolving contractual grievances and certain other labor disputes (39 U.S.C. 1206(b), 1206(c), 1207); and subjected the Postal Service and its employees' representatives to part (but only part) of the provisions of the National Labor Relations Act, 29 U.S.C. (& Supp. III) 151-169 (39 U.S.C. 1209(a)). In many ways, therefore, the Postal Service is like an ordinary private employer with respect to labor-management relations. Cf. Bowen v. United States Postal Service, 459 U.S. at 224-226. Nevertheless, in enacting the Postal Reorganization Act, Congress expressed its understanding that the Postal Service would in very significant ways continue to operate as a traditional agency of government, /5/ that postal service workers would continue to be government employees, /6/ and that only "in general" would labor-management relations of the Postal Service be subject to the requirements of the National Labor Relations Act, because "(c)ollective bargaining in public employment involves factors that differ importantly from those traditionally found in the private sector." H.R. Rep. 91-1104, 91st Cong., 2d Sess. 13, 57 (1970). Congress provided that, in contrast to employers and unions in the private sector, the Postal Service would have to engage in fact-finding and arbitration in cases of bargaining impasse (39 U.S.C. 1207) and that, unlike employees in the private sector, Postal Service employees would have no right to strike (39 U.S.C. 410(b)(1), incorporating 5 U.S.C. 3333, 7311). And, significantly, Congress also provided that the Postal Service and postal workers' bargaining representatives would be exempt from the requirements of the National Labor Relations Act "to the extent (those requirements are) inconsistent with provisions of (the Postal Reorganization Act)" (39 U.S.C. 1209(a)) -- provisions that include, of course, the mandate that the Postal Service ensure the "prompt, reliable, and efficient" delivery of the mails. Contrary to respondent's suggestion (Memo. for Resp. 7-8), Section 1001(e) of the statute (39 U.S.C. 1001(e)) in no way authorizes the Postal Service to waive or dilute its fundamental statutory obligations by collective bargaining or arbitration. Section 1001(e) specifies the "management rights" that the Postal Service enjoys -- e.g., the right to hire, promote, transfer, assign, suspend, demote, discharge, and otherwise to maintain the efficiency of the operations entrusted to it -- and, as respondent observes, provides that the Postal Service may not exercise those management rights in a manner that is inconsistent with its collective bargaining agreements. But nothing in Section 1001(e) purports to define the subjects that may properly be included in those collective bargaining agreements. Nor does Section 1001(e) suggest that the only limitations on the Postal Service's management rights are the collective bargaining agreements to which the Postal Service is party. Rather, Section 1001(e) states that the Postal Service must exercise its management rights "consistent with * * * applicable laws, regulations, and collective-bargaining agreements * * * ." Among the "applicable laws (and) regulations" are the Postal Service's basic mission-defining statutes, including the requirement that it provide "prompt, reliable, and efficient" mail services, and all those statutes and regulations that require protection of the security of the mails. Thus, while Section 1001(e) clearly may be read to authorize the Postal Service to limit its management rights by collective bargaining agreements (implemented by arbitrationi awards), it may not be read to authorize the Postal Service to limit its statutory obligations by such an agreement (or award). /7/ c. The statutory scheme does not, however, allow the Postal Service to use its statutory obligations as an excuse for refusing to comply with every arbitration decision with which it does not agree. /8/ The commitment to collective bargaining and arbitration as the means for resolving labor disputes is also a public policy specifically embodied in the Postal Reorganization Act (and generally in the laws regulating labor-management relations). See 39 U.S.C. 1206. This statutory commitment to the arbitral process must be given due weight, in both a procedural and a substantive sense, in the definition of the Postal Service's statutory obligations. Procedurally, the Postal Service may not bypass arbitration where it is properly invoked, even in cases which the Postal Service considers egregious. New facts may emerge and deference is owed the arbitrator's factual findings. See Misco, Inc., slip op. 14-15. The statutory commitment to the arbitral process is sufficiently strong to bind the Postal Service to the arbitrator's factual findings, even in public policy cases. Cf. Alexander v. Gardner-Denver Co., 415 U.S. 36, 60 & n.21 (1974) (plaintiff in a Title VII case is not foreclosed by arbitrator's factual findings and court should give them only the weight they appear to be due). Substantively, the Postal Service's statutory mandate may properly be invoked as a basis for challenging an arbitration award only in cases concerning that mandate's irreducible core. Otherwise, mutually beneficial working relationships with postal service employees' unions could not be maintained and the statute's commitment to collective bargaining and arbitral processes would itself be undermined. Thus, the public policy doctrine must be limited to situations where compliance with the arbitration award would threaten seriously to impair the irreducible duties of the Postal Service -- such as ensuring the security and reliability of the mails. See Port Jefferson Station Teachers Ass'n v. Brookhaven-Comsewogue Union Free School Dist., 45 N.Y.2d 898, 899, 383 N.E.2d 553, 554, 411 N.Y.S.2d 1, 2 (1978) ("Incantations of 'public policy' may not be advanced to overturn every arbitration award that impairs the flexibility of management * * * . Only when the award contravenes a strong public policy, almost invariably involving an important constitutional or statutory duty or responsibility, may it be set aside."). d. In this residual category of cases, however, the Postal Service's statutory obligations will require judicial non-enforcement of the arbitration award. Contrary to what respondent appears to have suggested (Memo. for Resp. 7-10), once an arbitrator's factual findings are given due respect, the arbitral awards arising from the statutory authorization to engage in collective bargaining cannot be allowed to displace completely the Postal Service's duty to comply with its basic statutory obligations, e.g., to see that the mails are promptly, reliably, and efficiently delivered and, more specifically, to ensure that the security of the mails is maintained. Rather, since the Postal Service's mission also arises from statute, it must be given appropriate respect -- as would be given any public policy of the United States. This statutory policy is as deserving of preservation as is the policy favoring collective bargaining and arbitration. Thus, in those rare instances where the Postal Service raises its statutory mandate as justification for noncompliance with an arbitration award, the courts must decide, as they would decide in any "public policy" case, whether the award is fundamentally inconsistent with the Postal Service's irreducible statutory obligations and thus unenforceable. This public policy determination cannot, as respondent implies (Memo. for Resp. 7-10), be made with finality by the parties through their contract or by an arbitrator interpreting the parties's contract. More is involved in these circumstances than the "common law of the shop." See Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 573, 581 (1960) (arbitrator who is applying only contractual provisions between private parties has broad leeway to fill in and to elaborate those provisions according to the "common law of the shop"). Rather, public law rights and obligations must also be considered, and the explication of public law rights and obligations is ultimately the tasks of the courts. See Misco, Inc., slip op. 12; McDonald v. City of West Branch, 466 U.S. 284, 290-291 (1984) (arbitrator does not have expertise to interpret, or authority to invoke, public laws and, accordingly, judicial determination is ultimately required); Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728, 744-745 (1981) (same); Alexander v. Gardner-Denver Co., 415 U.S. at 53-58 (same). The "public policy" question presented to the courts in such cases -- i.e., those cases where the Postal Service raises its statutory obligations to justify noncompliance with an arbitral award -- is, however, different in one important respect from the "public policy" questions that the courts typically face in cases involving private-sector employers and unions. Here, the employer is also the expert governmental agency charged by Congress with enforcement of the very public policy that is in issue. Indeed, the agency-employer possesses "all other powers incidental, necessary, or appropriate to the carrying on of its functions or the exercise of its specific powers" (39 U.S.C. 401(10)). Such an agency-employer's determination that compliance with an arbitration award would be inconsistent with that agency's own "public policy" obligations is entitled to some deference from the courts, at least there, as here, the "public policy" invoked is embodied in the statute from which the agency-employer derives its governmental powers and mission -- i.e., the Postal Reorganization Act. Thus, the question for the courts is not simply whether the Postal Service's mandate is best read as overriding the arbitration award. Rather, the question is whether the statute may permissibly be read to override the arbitrator's award, given the arbitrator's factual findings, the Postal Service's prior interpretations of its statutory mandate, the circumstances motivating the Postal Service's present position, and the language and legislative history of the pertinent statutory and regulatory provisions. In other words, if the Postal Service establishes that it has reasonably concluded that noncompliance with a particular arbitration award is necessary to achievement of its irreducible statutory obligations, a reviewing court should refuse to enforce that award. For the reasons explained above, the Postal Service had demonstrated in this case that noncompliance with the award here is required under that standard. 3. Finally, respondent argues (Memo. for Resp. 10-11) that, because Mr. Hyde has been rehabilitated, it is unreasonable for the Postal Service to determine that Mr. Hyde's reinstatement would fundamentally impair its statutory mission of ensuring the security of the mails. But the arbitrator did not find, and the record does not establish, that Mr. Hyde has been rehabilitated. Rather, it is clear that Mr. Hyde enrolled in Gamblers Anonymous and regularly attended sessions only as a mandatory condition of his court-ordered probation. Respondent tried to convince the arbitrator that Mr. Hyde had been rehabilitated, but the arbitrator found that a threat of recurrent misconduct existed and that Mr. Hyde was not yet ready to return to work (even though Mr. Hyde had been attending Gamblers Anonymous meetings for at least six months). Indeed, the arbitrator was unsure whether Mr. Hyde would ever be fully rehabilitated. Whatever the case would have been if the arbitrator had found Mr. Hyde to be rehabilitated, it was entirely reasonable for the Postal Service to conclude that, in the face of the substantial doubt recognized by the arbitrator, Mr. Hyde's reinstatement would be inconsistent with its statutory duty to ensure the security of the mails. /9/ As the district court properly recognized (Pet. App. 12a), the overriding logic of the statutory scheme the Postal Service is charged to effectuate necessarily reflects that "the mails are simply too important to the country to make them dependent upon the vicissitudes of rehabilitation of a single letter carrier." CONCLUSION The judgment of the court of appeals should be reversed. Respectfully submitted. CHARLES FRIED Solicitor General RICHARD K. WILLARD Assistant Attorney General LAWRENCE G. WALLACE Deputy Solicitor General GLEN D. NAGER Assistant to the Solicitor General WILLIAM KANTER MARC RICHMAN Attorneys JANUARY 1988 /1/ Pursuant to agreement with counsel for respondent, we are lodging 10 copies of the Postal Service's 1984-1987 collective bargaining agreement with the Clerk of the Court. This agreement does not differ in any pertinent respect from the collective bargaining agreement that was in effect at the time the arbitration award in this case was rendered. /2/ The Court has not decided whether and, if so, to what extent the statutes regulating the labor-management relations of other federal agencies -- specifically, those whose labor-relations are subject to Title 5 of the United States Code -- evidence this commitment to settlement of labor disputes through arbitration. Nor need the Court address that question in this case. /3/ This Court has not resolved whether a court may refuse to enforce an arbitration award on public policy grounds in circumstances where the award does not violate positive law or compel unlawful conduct by the employer (Misco, Inc., slip op. 15 n.12). Our argument in this case, that compliance with the arbitration award is inconsistent with the Postal Service's statutory duties, does not require resolution of that question. /4/ Cf. Schneider Moving & Storage Co. v. Robbins, 446 U.S. 364, 371-372 (194) (presumption of arbitrability does not apply where party benefiting from contract, such as pension trustee, does not have recourse to economic weapons of strikes and lockouts). /5/ Congress established the Postal Service as an "independent establishment of the executive branch of the Government of the United States" (39 U.S.C. 201). It conferred a wide range of governmental powers and attributes upon the Postal Service: The Postal Service exercises the power of eminent domain "in the name of the United States" (39 U.S.C. 401(9)); it promulgates regulations and publishes them in the Code of Federal Regulations (39 U.S.C. 401(2)); it investigates criminal offenses, enforces certain federal laws, levies fines, and enters into cooperative agreements with other federal agencies and other countries (39 U.S.C. 404(7), 407, 408, 410(b)(2), 411, 603, 3003, 5206, 5403, 5604); it is treated as a federal agency for purposes of tort claims, for service of process and rules of procedure, and for compliance with sundry other federal statutes (39 U.S.C. 409(b), 409(c), 410(b)); and its budget is submitted to the Office of Management and Budget and is transmitted to Congress by the President as part of the federal budget (39 U.S.C. 2009). /6/ Postal Service employees, as members of the postal career service, are "a part of the civil service" (39 U.S.C. 1001(b)) and thus participate in various programs established for the benefit of federal employees (see, e.g., 39 U.S.C. 1005(a)(2), (c) and (d), 1006). Moreover, Postal Service employees are subject to the same no-strike provisions as are other federal employees, the same suitability, security, and conduct regulations, the same nepotism rules, and the same withholding and dual-pay regulations (39 U.S.C. 410(b)(1)). In addition, Postal Service employees must swear or affirm their support for the Constitution before entering upon their duties (39 U.S.C. 1011). Thus, during the debate on the Postal Reorganization Act, it was explained that "employees of the U.S. Postal Service * * * would be Federal employees just like their counterparts in (the Department of) State, (the Department of Defense) or the Veterans' Administration" (116 Cong. Rec. 19849 (1970) (remarks of Rep. Mize)), and Postal Service workers were repeatedly referred to as "Federal employees" or "government employees" (see, e.g., id. at 19847 (remarks of Rep. Henderson); id. at 19852 (remarks of Rep. Hanley); id. at 22340 (remarks of Sen. Fong); id. at 22340 (remarks of Sen. Allen); see generally id. at 22334 (remarks of Sen. Ervin) ("it is absurd to say that we are dealing here with a relationship similar to that between a private employer and his employees")). /7/ Similarly, a union may not waive either its statutory obligation of fair representation or its members' right (or ability) to choose their collective representative. See Metropolitan Edison Co. v. NLRB, 460 U.S. 693, 705-706 (1983); NLRB v. Magnavox Co., 415 U.S. 322, 325-326 (1974). /8/ Nor would it be in the Postal Service's long-term interest in successful labor-management relations to attempt to do so. The Postal Service has accordingly challenged on public policy grounds only a handful of the thousands of grievance arbitration awards in which it is annually involved. /9/ Even if relevant, the affidavits filed by respondent (Memo. for Resp. App. 1a-7a) do not materially affect the substantial doubt noted by the Postal Service and the arbitrator. They assert only that Mr. Hyde continued to attend Gamblers Anonymous meetings, that he has not participated in any gambling since the date of the award, and that he has passed a physical fitness examination. While commendable, these assertions do not establish that Mr. Hyde has successfully overcome the problems that led him criminally to delay and jeopardize the mails or that there is not an unacceptably high risk that he would do so again. APPENDIX