sharon arbitration

7/29/2019 Sharon Arbitration

1/21

Done By-Elizabeth Sharon Lucas


2/21

Concept

Arbitration is a means of securing an award on a

conflict issue by reference to a third party. It is aprocess in which a dispute is submitted to animpartial outsider who makes a decision which isusually binding on both the parties.

It is a process where there is a hearing and adetermination of a cause between parties incontroversy by a person or persons chosen bythem, or appointed under a statutory provision.

The parties submit their disputes/issues and arebound by the award of an arbitrator in relation tothe matter which is in dispute between them.


3/21

Basics

The arbitrator enforces his own point ofview onthe contending parties and the opinions of theparticipants are notgiven any predominance.

Arbitration is a judicial process

The award of the arbitrator is binding and rests onequity and justice, i.e., there is no scope forcompromise

Arbitration is best suited for the settlement ofcontractual rights, whereas mediation is suited tothe adjustment of disputes over interests.


4/21

Advantages of Arbitration

i. Since it is established by the parties themselves,arbitration has the particular advantage ofbringing the dispute settlement procedure downto the level of the parties to the dispute. Workers

and management tend to have greater faith andconfidence in a settlement machinery which is ineffect their own.

ii. Since arbitration is established by agreement, itis more flexible than other procedures and canbe adjusted to the views, desires and experienceof the parties and to the circumstances obtainingin the undertaking or industry.


5/21

Contd.

III. This procedure, operating at the level closest tothe parties to the disputes, has the advantage ofenabling the arbitrators to acquire a muchgreater familiarity with the characteristics of theparticular industry or undertaking than most

courts or tribunals.IV. The procedure is relatively expeditious whencompared to that in ordinary courts or labourtribunals. It cuts down delays and results in aprompt settlement of differences.

V. It is informal in character because the disputesare handled by the parties themselves, often

without recourse to lawyers. Arbitration,therefore, is a less expensive than other

procedures.


6/21

Contd.

VI. Awards are capable of implementation withoutany grudge on the part of both the parties of thedispute and do not lead to further chances of

litigation.VII. Since arbitration is based on the consent of

both the parties, it helps building up a soundbase for healthy industrial relations, mutualunderstanding and co-operation.'

VIII. "It is popular because it is suitable andcompelling. It is far better than a costly work-stoppage, even though not wholly satisfactoryfrom either parties' point of views."


7/21

Types of Arbitration

Voluntary arbitration: impliesthat the twocontending parties, unable to compose theirdifferences by themselves or with the help of the

mediator or conciliator, agree to submit theconflict/dispute to an impartial authority, whosedecision they are ready to accept.

In other words, under voluntary arbitration, the

parties to the dispute can, and do, themselves refervoluntarily any dispute to arbitration before it isreferred for adjudication.


8/21

Essentials of voluntary arbitration

The voluntary submission of dispute to anarbitrator

The subsequent attendance of witnesses and

investigations The enforcement of an award may not be

necessary and binding because there is nocompulsion. But, generally, the acceptance of

arbitration implies the acceptance of its award-beit favorable or unfavorable; and

Voluntary arbitration may be specially needed fordisputes arising under agreements /contracts


9/21

Compulsory Arbitration Compulsory arbitration, is one where the parties

are required to accept arbitration without anywillingness on their part. When one of the partiesto an industrial dispute feels aggrieved by an act ofthe other, it may apply to the appropriategovernment to refer the dispute to an adjudicationmachinery.

Such reference of a dispute is known as'compulsory' or 'involuntary' reference, becausereference in such circumstances does not depend

on the sweet will of both the contending parties orany party to the dispute. It is entirely the discretionof the appropriategovernment based on thequestion of existing dispute, or on theapprehension that an industrial dispute will

emerge in a particular establishment.


10/21

Essentials of Compulsory Arbitration

I. the parties fail to arrive at a settlement by avoluntary method; or

II. when there 'is a national emergency which

requires that the wheels of production shouldnot be obstructed by frequent work-stoppages;or

III. the country is passing throughgrave economic

crisis; orIV. there is agrave public dissatisfaction with theexisting industrial relations; or (v) industries ofstrategic importance are involved; or


11/21

Contd.V. industries of strategic importance are involved;

orVI. parties are ill balanced, i.e.,where the unionsare weak, ill- organized, and powerless and themeans of production are in the hands of the

capitalists who are well-organized andpowerful; or

VII. public interest and the working conditionshave to be safeguarded and regulated by the

state.Compulsory arbitration leaves no scope for strikesand lockouts; it deprives both the parties oftheir very important and fundamental rights.


12/21

Reference of Dispute to Arbitration

Under Industrial Disputes Act, 1947

Under the Industrial Disputes Act, 1947, a dispute may bereferred to arbitration under the followingconditions:

a) An industrial dispute exists or is apprehended in anestablishment;

b) The employer and the workers agree, in writing, torefer the dispute to arbitration;

c) The arbitration agreement is in the prescribed formand signed by the parties to it in the prescribedmanner;

d) The agreement must be accompanied by theconsent, in writing, of the arbitrator or arbitrators;


13/21

Contd.

e) The dispute must be referred to arbitration atany time before it has been referred to a labourcourt or tribunal or a national tribunal;

f) The reference must be to the person or personsspecified in the arbitration agreement to act asarbitrator/arbitrators;

g) The arbitration agreement must set forth the

issue/issues to be decided by the arbitrationprocedure and a copy of the agreement isforwarded to the government and theconciliation officer.


14/21

Procedure for InvestigationAfter the dispute has been referred to the

arbitrator, he will hear both the parties. Hearing involves mastery of the facts of a

particular dispute as well as the relevant provisionsof the collective agreement and of the pastpractices of the parties in relation to mattersrelevant to the dispute.

An investigation of the facts and circumstances ofthe dispute is of great importance. The arbitratormay call witnesses, get evidence and relevant

records and documents, (bearing on the case) andarbitration decisions by other arbitrators in similarcases, that may suggest a line of reasoning.

When an important witness is unable to attend,sworn affidavit is often used.


15/21

After the collection of facts and supportingmaterials, arguments take place.

Certain principles are followed by an arbitratorwhile dealing with a particular dispute, namely:

I. Fair hearing,which demands that anopportunity should be given to both the partiesto be heard and cross-examined.

II. Principle of natural justicerequires that aparty should have due notice of proceedings,

and it must know what are the issues involvedand what part it has to play.


16/21

III. The party should be free to give any evidencewhich is relevant to the enquiry and on which itrelies for its arguments. The evidence given by oneparty should be taken in the presence of the otherparty so that the other party may rebut and place

counter evidence, if necessary.IV. The arbitrator should not relyon any document

which is not shown and explained to the otherparty and to which a reply has not been received.

He has to be completely impartial without any biasor prejudice against anybody.


17/21

Submission of Award

The arbitrator, after investigating the dispute, has tosubmit his award to the government.

The award will have the same legal force as the

judgment of a labour court or tribunal. The award must be signed by the arbitrator.


18/21

While writing his award, the arbitrator has toensure that:

i. The award is in line with the terms of referenceand that it does not go beyond its jurisdiction;

ii. It must be precise and definite, that is, it must beclear, unambiguous and without any, vagueness,and that it is not in any way capable of beingmisunderstood or misinterpreted;

iii. It should be capable of being enforced or

implemented; in other words, it should notcontain directives or provision which apparentlyseem impossible of enforcement;


19/21

iv. The award should contain a date or a specific period

for its implementation;v. The award should not violate any provision of any

existing law or settlement legally arrived at, or onewhich is binding on parties

vi. The award should contain sufficient justification orreasons for the settlement arrived at by thearbitrator.


20/21

Evils of Compulsory Arbitration

I. Compulsory arbitration promotes and prolongsindustrial disputes;

II. Compulsory arbitration undermines self-government

in industry, i.e., it hampers the development ofindustrial democracy;

III. It takes away from the employers and unions theresponsibility of working out their mutual problems

and transfers it to government-created tribunals;


21/21

IV. It kills collective bargaining and replaces it

with litigation; it allows the parties to avoidunpleasant confrontation of their difficulties,creating a dependency upon public authority;

V. By requiring even an air of compulsory labour,

it subjects workers to involuntary servitude;VI. It exposes workers to arbitrary restraints and

penalties before trial and correction;

sharon arbitration

Documents