non union arbitration

Greg Naylor IA · May 2001

Given the recent Supreme court decision in Circuit City, I am fielding an increasing number of calls from employers interested in exploring binding arbitration in the nonunion setting. The basics for the arbitration agreement are fairly straight forward but I am curious about practical application/implementation issues.

Has anyone been using arbitration for a period of time? If so, has it been effective in reducing litigation costs or are you simply seeing an increase in the volume of employee disputes and claims? Any tips for employers interested in it?

Mike Maslanka · May 2001

a key issue is how it's drafted...some clients are starting to put in that issues of law as determined by the arbitrator can be appealed on a de novo basis--this means that a court,in deciding whether to enforce the award,can give a fresh look at the arbitrator's decision and need not defer to the legal conclusions,only to the findings of fact(the distinction soemtimes gets a little lost)....regards from texas,mike maslanka

Gillian · May 2001

This is from a non-attorney and is an opinion probably not shared by a majority of my HR colleages. I think that, in general, employees view mandatory arbitration as just another way of putting the employer in the drivers seat thus reducing the incentive that the employer has to manage in a fair and equitable way - the best way of reducing litigation costs. I think that a new employee who signs an arbitration agreement on the first day of work feels the same way the rest of us do when we sign an arbitration agreement when we go in for surgery. We think - o, well, the surgeon and the hospital want to protect themselves from the outcome of a screw-up and we are going to end up with the short end of the stick. This is hardly the way to start a productive, mutually beneficial work arrangement with the new employee.

These are not the thoughts of an out of touch HR person. It is a considered opinion after more than 30 years of HR and, for the last ten years, service as an expert witness in employment litigation - more than 120 cases.

Craig · May 2001

I agree wholeheartedly with the prior post. Plus, a majority of the artbitrators I have seen come from either a union or academic background. Not the types that are generally "pro-business." I had this discussion with an attorney last week & his argument was that he would much rather take his chances convincing 1 person out of 12 that the company did nothing wrong , not leaving the decision to 1 arbitrator.

Mike Maslanka · May 2001

i could not agree with you more...many employers come to us and say,"write me an arbitration agreement",and we reply that whether you want one depends on your culture,your committment to have it cover everybody(including the top boss),and an understanding that if you have one then the roll out explaining it is key---for a fast food chain we even hired a firm to do an mtv type video explaining the program...also,we always call it an alternate dispute resoltuion program so that it encompassses more than just arbitration....regards from texas,mike maslanka

non union arbitration

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