A labor arbitration is a unique breed of proceeding – not quite a trial (no need to keep a copy of the rules of evidence nearby), not a commercial or even an employment arbitration proceeding, and not an administrative hearing, either. It is, however, a unique means of resolving disputes in the American workplace that provides an opportunity for an employer and a union to have a dispute resolved by an expert neutral decision-maker of their own choosing.
In contrast to other forms of arbitration that exist as alternatives to litigation, labor arbitration is the alternative to a strike by a union or a lockout by an employer. It is generally the last step in a contractual grievance process. Even where the grievance at issue concerns a particular employee, the arbitrator is hired by the employer and the union, and the process is theirs. In rendering an award, the arbitrator provides an interpretation of the parties’ collective bargaining agreement that the parties may rely on in their ongoing collective bargaining relationship.
The parties to a labor arbitration are always an employer and a union, and the arbitration is an extension of their collective bargaining process. The union may choose to settle a grievance even if the individual grievant wishes to pursue it, though the union may leave itself open to a claim (but not necessarily a valid one) for breach of the duty of fair representation if it does so. The path to grievance arbitration begins with the filing of a grievance by one of the parties.
The arbitrator is a private individual asked by the parties to resolve their dispute. He or she is, in almost all cases, a one-person shop rather than a firm because, in many cases, parties are interested in the particular expertise, style, or experience of the individual who they select as their arbitrator. The arbitrator’s authority is derived from the parties, subject to the terms of their collective bargaining agreement and as may be restricted by law.
Members of the National Academy of Arbitrators, as well as labor arbitrators listed with the Federal Mediation and Conciliation Service and/or the American Arbitration Association, are bound by a code of ethics known as the Code of Professional Responsibility for Arbitrators of Labor-Management Disputes.
Related (but Different) Processes
Given the frequent use of alternative dispute resolution processes in resolving workplace disputes, it is important to be aware of processes other than grievance arbitration that are also commonly utilized to help resolve certain types of labor and employment disputes.
Under certain circumstances, disputes between employers and employees involving statutory rights may be resolved outside of the courts through binding arbitration. These disputes may include claims arising under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act (“ADEA”), the Americans with Disabilities Act (“ADA”), the Fair Labor Standards Act (“FLSA”), and other state and federal statutes. In these cases, the same substantive remedies available in court must be available through the arbitration process. If an employer and a union agree, these sorts of individual claims may be raised under a negotiated grievance procedure.
Mediation is a form of assisted negotiation where the mediator, an impartial third party, engages with the parties to a dispute in order to help them resolve their dispute before they reach a formal hearing process, whether trial, litigation, an administrative hearing process, or arbitration. In contrast to arbitration and other adversarial processes, the mediator may meet alone, or ex parte, with one side in the absence of the other. The process is generally a confidential one, and parties may choose to utilize a mediator at any point in the lifecycle of their dispute.
Employers and unions may utilize impasse resolution processes, such as interest arbitration or fact-finding, when they are unable to resolve issues that arise in the course of term and midterm bargaining. Impasse resolution processes provide an opportunity for an impartial third party expert to hear the evidence and arguments of the employer and the union as to how the outstanding issues should be resolved and to order (as in interest arbitration) or to recommend (as in fact finding) a resolution to the dispute. Often, mediation or a hybrid process – such as med-arb – is also used to resolve bargaining impasses without the need for a formal decision or recommendation. The use of impasse resolution processes is particularly common in public sector labor relations as a substitute for economic pressure (such as a strike or a lockout) that might be exerted in the private sector, though these types of processes may be used in the private sector as well.
Building a Solid Case in the Grievance Procedure
The best opportunity to succeed in labor arbitration comes during the grievance process. In the best case, the employer and the union can resolve a grievance in the course of the grievance procedure and avoid arbitration completely. Even if a matter appears unlikely to settle without proceeding to arbitration, preparation for arbitration begins with the grievance process. The grievance filing and the initial response are the best opportunities to gather information through interviews with the grievant, management officials, and witnesses as well as creating documentation (including notes from grievance meetings or signed statements from witnesses, particularly those who might not be available for a hearing months later) that will serve your side well at an arbitration hearing. Be sure to raise claims, defenses, and/or objections as early as possible in order to avoid potential issues of waiver; raising issues earlier on also avoids the perception that a particular claim or defense is just an afterthought. It is also crucial to understand the applicable grievance procedure – be aware of deadlines, filing requirements and other hurdles that may create issues of procedural arbitrability later in the process.
The assessment of whether a case should proceed to arbitration is an exercise in listening, questioning, and critical thinking. The management advocate should interview the supervisors and managers involved, while the union should interview the grievant, his or her steward, and any other bargaining unit employees involved. Both parties should identify adverse and/or third party witnesses, if any, and consider how, if at all, the accounts of those witnesses may be obtained — third party witnesses may have to be subpoenaed, for example, and many parties have contract provisions or past practices prohibiting parties from calling witnesses cross-table (e.g., the employer calling a member of the bargaining unit as a witness or the union calling a supervisor). As always, advocates should review the operative collective bargaining agreement and, if an employer policy or rule is at issue, both sides should review the relevant document(s) as well. Before proceeding to arbitration, each side should research past arbitration decisions and grievance settlements that may impact the outcome of the case and consider whether any past practices may be implicated by the grievance.
When the decision has been made to proceed to arbitration, it is crucial to review the grievance and arbitration provisions of the collective bargaining agreement to determine what will be required in order to properly invoke arbitration. Often, there are time limitations (e.g., arbitration must be invoked within X days of the issuance of the decision at the prior step of the grievance procedure) or restrictions governing how one party notifies the other that arbitration has been invoked (e.g., by mail or in person, but not electronically). Failure to comply with these requirements may result in a challenge to the procedural arbitrability of the grievance.
Selecting the Arbitrator
The process of selecting an arbitrator is often governed by the terms of the collective bargaining agreement, though the employer and the union may elect an alternative procedure if jointly agreed. In selecting arbitrators, parties consider a number of criteria, including subject matter expertise, their prior experience with a given arbitrator, individual arbitral style and practice, and cost. A particular arbitrator may have experience in multiple collective bargaining environments (e.g., private, federal, state, and/or municipal sectors). The processes involved in these different settings are generally similar, but there are important differences between each setting, such as the application of particular laws or regulations, that may influence who parties select as their arbitrator.
Often, parties will have agreed to request lists, or panels, of arbitrators from outside organizations that maintain a roster of arbitrators, such as the Federal Mediation and Conciliation Service or the American Arbitration Association. A number of state and local jurisdictions maintain their own rosters of arbitrators, often for use by public sector parties. In the event that an outside panel of arbitrators is requested and received, the parties either agree on a name from the list (or a name not listed) or they will engage in a ranking or striking process designed to leave one name remaining.
Alternatively, parties will develop their own internal panels of arbitrators. These internal panels have developed for a number of reasons, including the parties’ familiarity with the arbitrators that they wish to have deciding their cases as well as an attempt to avoid fees associated with requesting outside panels. The parties will often arrange for cases to be assigned to the listed arbitrators on a rotating basis, and develop procedures for the removal of arbitrators from the panel. Under some collective bargaining agreements, a case may utilize a board of arbitration, often consisting of three arbitrators, with one arbitrator appointed by each party (partisan arbitrators) and one impartial arbitrator, or a panel of three impartial arbitrators.
A follow-up article will discuss preparation for and conduct of the hearing, as well as the conclusion of the grievance arbitration process.