Arbitration - Labor Disputes

Arbitration and Its General Advantages

Parties involved in a labor agreement may turn to arbitration as a means of resolving disputes. In very general terms, arbitration refers to the process by which parties submit evidence and arguments to an arbitrator for resolution. Arbitration takes the place of a trial and is meant to be less complicated and less expensive than a lawsuit. It is also typically quicker than a trial. And, in the case of labor relations, arbitration may be a way of resolving conflict without the threat of a strike.

Forfeited rights

Although arbitration in many ways provides an advantageous alternative to a trial, it is important to remember that it also requires both parties to give up some of the rights that they would have otherwise. Both the employer and the union/employee must to accept the decision of the arbitrator. There is rarely, if ever, a way to appeal the decision and refusal to abide by it could lead to a lawsuit seeking court enforcement. In addition, the employer forfeits the right to act independently with regard to the labor agreement or the conflict at hand. The employees, on the other hand, typically agree not to strike over the dispute.

Selecting an Arbitrator

Most often, a labor contract provides for the hiring of an arbitrator, an individual familiar with both the company and the union who handles all disputes. In cases where there is no predetermined arbitrator, the parties involved must select one. The contract should set out criteria for choosing an arbitrator or a clause stating that an outside agency such as the American Arbitration Association or the Federal Mediation and Conciliation Service will choose the arbitrator.

Submission of Materials

Once an arbitrator has been selected, the arbitration process begins with the submission agreement. This document defines the authority of the arbitrator and grants him that authority. The party requesting the arbitration then submits to the arbitrator a summary of the complaint, a reference to the relevant part of the contract, and the resolution sought.

Arbitration Hearing

After receiving the submission, the arbitrator schedules a hearing date. The hearing itself can follow a number of formats, from an informal meeting in a conference room to something that resembles a trial in everything but the jury. The nature of the dispute and the relationship between the parties plays a large role in determining the type of hearing needed.

Other details of the hearing that are variable include whether or not attorneys are present, whether or not third-party witnesses are called, and whether or not a transcript of the proceedings is produced. Although the arbitrator may accept input from the parties, he makes the final determination of formality. Ideally, the hearing should be no more complicated than a reasonable presentation of the arguments and evidence requires.

At the conclusion of the hearing, the arbitrator considers all of the information presented and makes a decision. As was mentioned earlier, the agreement to resolve disputes by arbitration usually includes an agreement to accept the outcome. Hence, the ruling of the arbitrator is final and binding for both parties.

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