In a decision some experts feel may flood the courts with cases, a divided Supreme Court ruled yesterday that a union member does not have to exhaust internal union appeals before filing suit over the handling of a grievance.

Justice William J. Brennan, writing for the five-man majority, said that Clifford E. Clayton, a United Auto Workers member who was fired from his job by an ITT subsidiary, should have been allowed to continue suits against both the company and the union because his internal union appeal, even if successful, wouldn't get his job back.

Lower courts agreed with union claims that Clayton should have exhausted his internal appeals before filing suit charging the UAW with failure to represent him properly. The union had filed a grievance in his case but then dropped it before it reached the arbitration stage, believing they could not win the case.

Justice William H. Rehnquist wrote a dissent charging that the Supreme Court was taking "much too narrow a view" of why unions seek to use internal appeals before having to defend themselves in court. Union appeals shouldn't have to provide a complete remedy to be deemed adequate, he said.

Making a member exhaust internal appeals "promotes union democracy and self-government as well as the broader policy of noninterference with union affairs," Rehnquist said. A union's incentive to provide substantial relief "will be greatly undermined if an employe can simply bypass the procedures at will," he added.

The case was considered important because there has been a growing number of suits by members charging their unions with improperly handling grievances. M. Jay Whitman, UAW associate general counsel who argued the Clayton case before the Supreme Court, estimated that half the union's current 1,300 cases involve similar issues.

Whitman noted, however, that the major UAW contract with the three major American auto manufacturers does allow reinstatement of a complainant if the internal appeal is successful.

Theodore St. Antoine, a University of Michigan law professor who is on a UAW external review board, said he feared the decision might force unions to take weak cases to arbitration because of the possibility of a suit later.

However, Paul Tobias, a Cincinnati attorney who has represented several litigants in such cases, viewed the decision as "extremely important for little people."