Advantages & Disadvantages to Arbitration: When Negotiations Fail
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When negotiations fail or stall, management and union may opt for arbitration. Arbitration involves transferring the power to make employer-employee related decisions to an often less-informed outsider.
• Discuss the central reasons an employer or a union is unable to reach a collaborative resolution to some issues and why arbitration is the preferred method in these situations.
• Detail the advantages and disadvantages of allowing an outside arbitrator to resolve internal disputes between the union and management.
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Solution Summary
Arbitration occurs when two parties have hit a "dead end" in negotiations. The concept brings together an impartial third party, to hear each party's facts and desires. This person makes a recommendation for resolving the matter and is prohibited from having any form of interest in the outcome.
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The central reasons for employer and unions to reach an inability for collaborative resolution in negotiations include a "win at all cost" mentality (from either or both parties) along with prejudiced viewpoint of the same information. In the work environment, negotiations are truly no different than in one's personal life. In buying a car, the consumer wants the best price - while the auto dealership wants the highest profit. The same is true for employer/union negotiations. The union wants to secure the best wages, working conditions and benefits for its members. The employer ...
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