In the 1973 case Alexander v. Gardner-Denver Co., the U.S. Supreme Court held that an employee does not forfeit his right to pursue a claim in federal court under Title VII of the Civil Rights Act, even after losing at arbitration under a collective bargaining agreement (CBA). Harrell Alexander, an African-American employee of Gardner-Denver Co., was fired for allegedly violating a work rule. His union filed a grievance on his behalf and pursued it to arbitration per their CBA, but lost. Subsequently, Alexander filed suit in federal court alleging racial discrimination under Title VII. The company argued that he was barred from doing so because of the prior arbitration decision against him; however, the Supreme Court disagreed stating that contractual rights established by CBAs are distinct from individual's statutory rights granted by Congress and one cannot waive another.

In the dissenting opinion for Alexander v. Gardner-Denver Co., Justice William O. Douglas argued that an employee should not be barred from pursuing a lawsuit under Title VII of the Civil Rights Act after losing in arbitration proceedings stipulated by a collective bargaining agreement. He contended that Congress intended to provide multiple avenues for redress when it passed civil rights legislation, and thus, employees should not be forced to choose between their contractual rights under labor law and their statutory rights under civil rights law. Furthermore, he expressed concern about the potential bias of arbitrators who are often selected with input from employers and unions but may lack expertise in discrimination laws or fail to apply them correctly due to this inherent conflict of interest.