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For arbitration on wikipedia, see Misplaced Pages:Arbitration Committee.

Arbitration is a legal technique for the resolution of disputes outside the courts, wherein the parties to a dispute refer it to one or more persons (the "arbitrators" or "arbitral tribunal"), by whose decision (the "award") they agree to be bound. In the United States, the term is also used to refer to non-binding arbitration, a process in which the final award does not bind the parties.

Arbitration is today most commonly used for the resolution of commercial disputes, particularly in the context of international commercial transactions. It is also used in some countries to resolve other types of disputes, such as labour disputes, consumer disputes or family disputes, and for the resolution of certain disputes between states and between investors and states.

Workplace Arbitrations

According to Workplaces That Work: A Guide to Conflict Management in Union and Non-Union Work Environments (Aurora: Canada Law Book, 2006)arbitration is used extensively in unionized workplaces and is growing in frequency in non-union workplaces. It is often the last step in a dispute resolution system. This is the most expensive remedy short of litigation and can be very resource intensive. Some arbitration processes, though, are expedited and, by agreement of the parties, many cases are resolved in one sitting with the arbitrator. The expedited arbitration processes are most likely to be found in a unionized work environment where the union has carriage of the grievances in question.

Arbitrations can be internal or external, use a single arbitrator or a panel of arbitrators, and there can be standing arbitrators for particular issues.

The value of arbitration is that it provides certainty and closure for disputes. Generally speaking it is faster, less expensive, and less formal than the courts. In non-unionized workplaces arbitration is used in employment contracts disputes as a substitute for court. Internal arbitration may be binding or non-binding. Where there is a non-union grievance procedure, arbitration may act as the final internal source of dispute resolution. --Blaine Donais 14:02, 30 September 2006 (UTC)

Arbitration Process Defined for Unionized Workplaces

Arbitration is a time-consuming and expensive process. It could take a number of days, spread out over many months, and cost tens of thousands of dollars. In many unions, the arbitration budget can account for as much as 1/3 of the total budget for the union. Therefore, decisions to take a case forward to arbitration are carefully considered. The union often seeks a legal opinion prior to proceeding.

Collective bargaining relationships vary on their use of arbitration to resolve their disputes. Some collective agreements have a three member arbitration panel: a union nominee, an employer nominee and a third party arbitrator selected by joint agreement. Other collective agreements use a single standing arbitrator.

Unions and employers are moving steadily toward a single arbitrator because of: - The expense of paying three members. - Scheduling issues – accommodating three schedules instead of one. - Growing judicialization of labour arbitration and greater party confidence in the neutrality of the process.

In virtually all cases, the parties negotiate a “finality clause” in the collective agreement. This clause secures the arbitration process from undue and costly judicial review. This does not immunize an arbitrator from review by the courts, but it significantly raises the standard.

Unlike the steps leading up to arbitration, arbitration is normally quite formal and often involves the use of legal counsel. The process begins with a letter to the employer moving the grievance to arbitration.

(1) Choosing an Arbitrator or Panel The parties must all agree to the arbitrator. Senior labour relations staff and union representatives often choose from a “standing list” of arbitrators itemized in the collective agreement.

The choice of an arbitrator is a strategic decision. The union may want a particular arbitrator because s/he has a reputation for compassion on employment termination cases. And the employer may want a more hard-nosed arbitrator for the same reasons. Both parties may desire an arbitrator who understands complex subject matter. One or both of the parties may also desire an arbitrator with mediation skills to work behind the scenes to reach settlement prior to hearing the case.

Arbitrators have relationships with the parties, where the parties come to trust their decisions. At times, however, one or both of the parties will choose not to use their regular arbitrators or may wish to add new arbitrators to the list depending upon: - Recent decisions made by the arbitrator for the parties. - Recent decisions made by the arbitrator for other parties. - Perceived conduct of the arbitrator by one or both of the parties on a previous case. - Personality changes in management or the union. - Direction changes in management or the union. - Availability of the arbitrator (i.e. consistent lack of availability). - Arbitrator’s reputation for generating quick written decisions.

(2) Jurisdiction of the Arbitrator Some collective agreements specify the powers and jurisdiction of the arbitrator, while others are silent and leave the matter to general arbitral jurisprudence and labour legislation.

Even where a collective agreement is silent on the matter of the arbitrator’s powers and jurisdiction, Labour Relations legislation usually spells out mimimum powers.

In arbitrating “any difference” between the parties, an arbitrator has considerable breadth of jurisdiction. In addition to violations of the collective agreement and unreasonable exercise of management’s residual rights, the arbitrator makes awards on violations of both human rights legislation and even constitutional violations.

(3) Powers of the Arbitrator or Arbitration Board Arbitrators in a collective bargaining regime have powers similar but not equal to judges in a common law regime. Arbitrators:

- Make rulings on the credibility of evidence. - Apply standard rules of evidence. - Order the disclosure of evidence. - Issue subpoenas to require a witness to testify. - Make decisions in absentia if one of the parties refuses to appear.

Arbitrators do not generally have a judge’s power to find one of the parties in contempt of the proceedings; nor do they have the power to issue injunctions.

(4) The Written Brief It is often customary for both parties to submit written briefs to the arbitrator and to copy those to the other side. The brief includes a recitation of the relevant facts, the legal issues in question, the party’s positions and arguments and arbitral jurisprudence in support of the argument. In some cases documentary evidence in support of the arguments is allowed in the brief. Often the parties trade briefs and are allowed to write a short reply brief within a week or so of receiving the primary brief. The arbitrator is expected to read the briefs in preparation for the first arbitration date.

(5) Preliminary Issues On the first day of arbitration it is common for either of the parties to raise preliminary issues such as: - Questions on the jurisdiction of the arbitrator to hear the case. - Orders of production of documents. - Any agreements on limiting the number of witnesses or using representative witnesses.

(6) Hearing Once the preliminary issues are dealt with, the parties provide opening statements. Then the union, except in discipline cases, presents its evidence, primarily with witness testimony and documents. The union representative runs the witnesses through an examination in chief, using open-ended questions to get the witnesses to relay their testimony. The employer cross-examines the witnesses. These witnesses will be sworn in just like in a normal court proceeding.

Once the union completes its case, the employer argues its case in the same manner. Relatively strict rules of evidence apply to these cases. “Hearsay” and “similar fact” evidence are only allowed in certain instances. Witnesses are allowed to refer to notes, but the significance of the notes depends upon when they were taken. The union may call reply witnesses but only to directly refute new statements made by the employer’s witnesses.

Closing statements relate the testimony and other evidence to the case law in a manner which the parties hope will convince the arbitrator of their position. Clearly in this case there is one right party and one wrong party. There generally is little room for “win-win” solutions in an arbitrated decision. Arbitration, then, is simply a legal adjudication on the issue of whether the collective agreement has been violated or management discretion has been reasonably exercised. The standard for decision-making is on a “balance of probabilities”.

(7) Arbitral Jurisprudence North American arbitrators rely upon arbitration case law to inform their decisions. The parties try to show the arbitrator that the case law supports their respective positions. Unless expedited, arbitrators reserve their decision and take a number of weeks to consider all the information presented to them. Arbitrators are not bound by stari decisis (that is, they are not formally required to follow the case law). Nevertheless, arbitrators want to ground their cases in prevailing jurisprudence.

(8) Judicial Review of Arbitration Decisions in Canada Arbitration decisions are “final and binding upon the parties” but are subject to review by the courts. Courts review an arbitration decision to determine if the arbitrator has exceeded his/her jurisdiction or has made a decision that is “patently unreasonable”. The later standard has come under scrutiny of late with many lawyers expressing the opinion that courts are interpreting the standard in a way that reduces it to “simple unreasonableness”. Nevertheless, there still appears to be considerable judicial deference to arbitration decisions and it is only in rare occasions that arbitration awards are successfully judicially reviewed.

(9) Implementation of Arbitration Awards In many cases the arbitrator remains “seized” of the case in order to be an agent in interpreting, implementing and enforcing an arbitration award. Thus where the parties have a disagreement as to how an award should be interpreted, they may return to the arbitrator for help. They may do so by calling the arbitrator on a conference call or reconvening the hearing. --Blaine Donais 14:02, 30 September 2006 (UTC)

Blaine Donais President and Founder Workplace Fairness Institute

See also

• Arbitration in the United States of America
• Conflict resolution research

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