CHAPTER IV
Substantive provisions of labour legislation: Settlement of collective
labour disputes1
Introduction
Labour disputes and conflicts are inherent in all labour relations systems.
They tend to occur when the collective bargaining process is reaching
a breaking point and, if not resolved, often give rise to industrial
action, such as strikes. The establishment of a system for the prevention
and settlement of labour disputes is therefore a cornerstone of sound
labour relations policy.
An effective labour dispute settlement system helps to contain labour
conflicts within economically and socially acceptable bounds and to promote
an atmosphere of industrial peace. This in turn contributes to the maintenance
of a climate that is conducive to development, economic efficiency and
social equity.
The effective resolution of labour disputes is closely linked to promotion
of the right to collective bargaining. The attitudes and skills required
for one are the same as for the other. The structure of dispute settlement
systems is normally designed to promote collective bargaining, for example
by requiring the parties to exhaust all the possibilities of reaching
a negotiated solution or to exhaust the dispute settlement procedures
provided for by their collective agreement before having access to State
provided procedures. However, the danger to be avoided is the imposition
of solutions, particularly through compulsory arbitration which, if not
accompanied by the necessary safeguards, may amount to a denial of the
right to free and voluntary collective bargaining.
Experience from many countries shows that the centre of gravity of a
State dispute settlement system should be conciliation/mediation procedures
aimed at assisting the parties to reach a negotiated settlement under
conditions that are as close as possible to those of the normal bargaining
process. Dispute settlement systems can also reinforce collective bargaining
where the agreements resulting from such procedures are accorded the
same legal status as agreements concluded through collective bargaining.
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Provisions of ILO instruments on the settlement of labour disputes
Several ILO instruments on the promotion and protection of the right
to collective bargaining contain provisions relating to labour dispute
settlement machinery. The main principles set out in these instruments
are that:
- bodies and procedures for the settlement of labour disputes should
be so conceived as to contribute to the promotion of collective bargaining
(Convention No. 154, Article 5, paragraph 2(e));
- procedures for the settlement of labour disputes should assist the
parties to find a solution to the dispute themselves (Collective
Bargaining Recommendation, 1981 (No. 163), Paragraph 8);
- disputes in the public service should be settled through negotiation
between the parties or through independent and impartial machinery,
such as mediation, conciliation and arbitration (Convention No. 151,
Article 8).
ILO Conventions and Recommendations leave ample room for member States
to design their own dispute settlement systems, in accordance with the
following general principles:
- governments should make available voluntary conciliation machinery,
which is free of charge and expeditious, to assist in the prevention
and settlement of industrial disputes (Voluntary
Conciliation and Arbitration Recommendation, 1951 (No. 92), Paragraphs
1 and 3);
- the parties to disputes should be encouraged to abstain from strikes
and lockouts while conciliation or arbitration is in progress (Recommendation
No. 92, Paragraphs 4 and 6);
- agreements reached during or as a result of conciliation proceedings
should be drawn up in writing and accorded the same status as agreements
concluded in the usual manner (Recommendation No. 92, Paragraph 5).
In practice, the principal methods of dispute settlement, used in many
countries, as suggested by the relevant ILO instruments, are:
- conciliation/mediation (which may or may not be differentiated);
- arbitration; and
- adjudication.
All of these are commonly established on a statutory basis and involve
independent and impartial third parties to assist in the resolution of
disputes. Conciliation/mediation and arbitration procedures are sometimes
also established under the terms of collective agreements.
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Definitions and classifications of labour disputes
Concepts
Labour disputes may be of different kinds, each of which is most susceptible
to a particular type of dispute settlement procedure at a final stage.
Most countries distinguish between several types of labour disputes and
have established separate procedures for dealing with them. Of course,
the distinctions and procedures in any country reflect the specific historical
development of its labour relations system.
The two most generally applied distinctions are between:
- individual and collective disputes, and
- disputes about rights and disputes about interests (also known as
economic disputes). It is this latter distinction that characterizes
the dispute settlement machinery of many countries.
A rights dispute is a dispute concerning the violation of or
interpretation of an existing right (or obligation) embodied in a law,
collective agreement or individual contract of employment. At its core
is an allegation that a worker, or group of workers, have not been afforded
their proper entitlement(s).
An interests dispute is one which arises from differences over
the determination of future rights and obligations, and is usually the
result of a failure of collective bargaining. It does not have its origins
in an existing right, but in the interest of one of the parties to create
such a right through its embodiment in a collective agreement, and the
opposition of the other party to doing so.
The distinction between individual and collective disputes is
less easy to draw. One reason for this is that an individual dispute
can develop into a collective dispute, particularly where a point of
principle is involved and if it is taken up by a trade union. In general,
however, a dispute is individual if it involves a single worker, or a
number of workers as individuals (or the application of their individual
employment contracts). It becomes a collective dispute if it involves
a number of workers collectively.
Clearly, both individual and collective disputes may concern rights.
A worker may be aggrieved at not having been treated in accordance with
a contract, and a union because its members have not been treated in
accordance with the terms of a collective agreement. Interests disputes,
however, are necessarily collective in character.
There are certain other distinctions that can be drawn between types
of labour disputes, usually by reference to the particular conditions
that are the subject of the dispute. In many countries, specific types
of dispute are subject to special settlement procedures. These include
disputes over trade union recognition and the right/obligation to bargain
and disputes regarding discriminatory action against workers on the basis
of trade union membership and activities. Another common example is the
operation of special tribunals to deal with allegations of discrimination
on the basis of race or sex.
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Legislative definitions
Sometimes legislation does not provide an explicit definition of what
is meant by a labour dispute, but leaves it to the parties seeking assistance
and the authorities providing that assistance to determine whether the
situation is such as to warrant invoking the available procedures. However,
in many cases the legislation does provide explicit definitions, which
may be general and all-embracing or entail a classification of disputes
into different types. In other cases, the definitions and classifications
are not fully explicit, but are implicitly derived from provisions allocating
specific types of dispute to particular procedures.
In some countries, all types of disputes are initially handled by a
single procedure (conciliation). It is only where conciliation fails
that they are classified by type with a view to their submission to separate
settlement procedures and also to determine whether the parties are entitled
to have recourse to industrial action.
In general, definitions of labour disputes usually refer to the parties
and the subject matter. Such definitions may also cover disputes between
workers and other workers, or between parties who are not in an employment
relationship.
 Example
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The purpose of labour dispute settlement procedures
In general, the purpose of a system for the settlement of labour disputes
should be the peaceful and orderly settlement of disputes, principally
through the efforts of the parties themselves, so that it is unnecessary
for them to resort to strikes and lockouts. Some dispute settlement systems
are based on a legislative expression of this objective.
Example
In systems of free collective bargaining, the basic principle underlying
procedures for the settlement of interests disputes is that the parties
should resolve the disputes themselves through negotiation, while still
having the possibility to threaten, or if necessary to take, industrial
action. Third parties should be available in the event of a breakdown
in negotiations, but only to assist the parties to the dispute to find
a mutually acceptable solution to their differences. Nevertheless, there
are in practice systems in which a threat of industrial action is sometimes
the prelude to negotiation. In these systems, collective bargaining tends
to be seen as a first method of dispute settlement, before recourse is
had to the others.
Most systems include a mixture of voluntary and compulsory elements.
The more a system is designed to promote the freedom of the parties to
bargain and the settlement of disputes through a compromise that is freely
arrived at, the more voluntary procedures will predominate. In systems
which place greater emphasis on the avoidance of work stoppages, compulsory
elements tend to be more prevalent.
In contrast, the basic principle underlying procedures for the settlement
of disputes over rights is that they should, unless settled
by negotiation, be resolved by courts or tribunals (or, in some countries,
by arbitrators), rather than by industrial action, because they
involve the determination of existing rights, duties or obligations which
both parties are bound to respect. In such cases, the availability of
adjudication for rights and obligations makes recourse to industrial
action unnecessary and usually dysfunctional. Nevertheless, certain grievous
or persistent violations of rights are sometimes considered by legislation
as excusing, if not rendering legal, recourse to industrial action by
the aggrieved party as an expression of protest. In such instances, the
penalties applicable for industrial action are not applied.
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Reporting of disputes and initiation of the procedure
Legislative provisions may require or make provision for the
reporting of labour disputes to the competent authority. The reporting
of a dispute is the usual method for the commencement of labour dispute
settlement procedures. It sometimes takes the form of a requirement to
report labour disputes within a certain period of their occurrence, and
to provide certain details for this purpose.
Under some legislation, a request or the reporting of a dispute by
one of the parties is sufficient for conciliation or mediation to be
commenced, while in other cases both parties have to agree to the submission
of the dispute for the procedure to be set in motion (particularly in
the case of interests disputes). The rationale for requiring only one
party to request the initiation of the procedure is that everything should
be done to avoid industrial conflict. In contrast, the reason for requiring
both parties to agree to submit the dispute to conciliation or mediation
is that the procedure is hardly likely to be successful unless both parties
are amenable to it. Nevertheless, in practice, in the great majority
of cases this makes hardly any difference since the parties to labour
disputes are generally quite willing to have the assistance of a competent
third party to resolve the dispute before a work stoppage is initiated.
Example
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Conciliation and mediation
Distinctions between conciliation and mediation
In some countries, conciliation and mediation refer to the
same type of procedure, while in others they denote distinct procedures.
However, in both cases they consist of a means of assisting the parties
to the dispute, through neutral third party intervention, to reach a
mutually agreed settlement. The conciliator or mediator assists the parties
to settle the dispute by themselves when negotiations have failed or
reached an impasse. The conciliator or mediator is not empowered to impose
a settlement on the parties. Conciliation/mediation in its least interventionist
form is the most widely used method of dispute settlement under government
auspices. In most industrialized market economy countries, it is by far
the most common procedure employed for the settlement of collective interest
disputes. Voluntary arbitration tends to be used much less frequently,
if at all.
While conciliation or mediation is the primary method used to resolve interests
or collective labour disputes, it is often a compulsory preliminary
step before the adjudication of a rights or individual dispute.
Mediation is sometimes distinguished from conciliation as a
separate method of dispute settlement in cases where, even though the
dispute still has to be settled by agreement of the parties, the third
party is somewhat more active than in conciliation and may have the authority
(and in some cases the duty) to submit formal proposals for the settlement
of the dispute. A distinction between conciliation and mediation is sometimes
found in labour legislation, although it is not always reflected in the
legislative definition of "mediation".
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Voluntary and compulsory conciliation/mediation
Conciliation/mediation may be voluntary or compulsory. It is voluntary
where the parties are free to have recourse to it or not. It is also
voluntary where it is undertaken by mutually chosen private third parties,
outside the machinery established by the government or by law. In some
cases, the law requires that both parties consent to or initiate the
use of conciliation.
Conciliation/mediation is compulsory where the parties to a
labour dispute are required to have recourse of it. Compulsory
conciliation/mediation can be used as a means of ensuring that the hostile
parties to a labour dispute come together at the negotiating table. Compulsion
may therefore be preferred where the labour relations system is not well
developed and/or in cases where the parties are not used to negotiating
with each other. Conciliation is also often compulsory in systems which
include compulsory arbitration (see Compulsory arbitration below).
Another significant reason for requiring recourse to conciliation/mediation
in interest disputes is to limit, and if possible prevent recourse to
industrial action. A strong link between conciliation/mediation and industrial
action can be made by requiring the parties to give advance notice of
industrial action to the conciliation authority, or by making it illegal
to take industrial action without first endeavouring to resolve a dispute
by means of conciliation.
A requirement to engage in conciliation/mediation may be based on any
of the following, or a combination of them:
- an obligation to notify the competent authority of a dispute;
- a requirement to report disputes to the authorities, who may then
be empowered to initiate conciliation/mediation proceedings and/or
to require the attendance of the parties at such proceedings;
- a restriction on the choice of the third party called upon to conduct
the conciliation/mediation;
- a requirement to participate in conciliation/mediation;
- the prohibition of strikes and lockouts before a conciliation/mediation
procedure has been resorted to and completed;
- an obligation to adhere to an agreement concluded during conciliation/mediation;
- in the case of rights disputes, the requirement to have undergone
conciliation before the dispute can be considered by a court or tribunal.
Systems which require participation in conciliation also sanction failure
to comply with this requirement. A party may be liable to a fine for
failing to appear without good cause. A party that does not attend may
run the risk of the dispute being declared unresolved, thereby leaving
the other party in a position to move towards industrial action. Or the
dispute settlement body may have the power to award costs against a party
which has failed to appear. In systems which adopt this approach, failure
to appear may also be deemed an unfair labour practice.
One commonly held view in this respect is that there is little purpose
in making conciliation proceedings compulsory as there is not much chance
of achieving agreement if one of the parties is recalcitrant. Others
consider that all efforts should be made to avert industrial conflict
and that the parties to a dispute should therefore be obliged to submit
to these procedures, even if agreement at the end of the procedure has
to be voluntary.
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Institutional and ad hoc conciliation
Conciliation is commonly undertaken by government conciliation services
or, more rarely, by labour inspectors. Some countries have established
conciliation bodies by statute and their independence from the government
contributes to the confidence of the parties in the neutrality of the
machinery. Examples include Denmark (the Conciliation Board), Ireland
(the Labour Relations Commission), South Africa (the Commission for Conciliation,
Mediation and Arbitration), the United Kingdom (the Advisory, Conciliation
and Arbitration Service) and the United States (the Federal Mediation
and Conciliation Service). In some cases, confidence in the independence
of conciliation machinery is bolstered by the tripartite or bipartite
composition of their governing bodies or of the conciliation service
itself. Certain of the legislative provisions governing the services
provided by these bodies are included later in this Chapter (see Establishment
and functions of disputes settlement institutions below).
Conciliation may, however, be provided on an ad hoc basis, with either
an individual or a conciliation board appointed on a case-by-case basis.
Some systems provide for both individual conciliators and conciliation
boards, while others merely encourage the parties to endeavour to settle
their disputes by these means. The use of individual conciliators may
offer certain advantages over conciliation boards, as individuals may
be more flexible. Individuals may also confer a certain level of efficiency,
deriving in some measure from their ability to specialize. Of course,
reliance on individual conciliators requires a means of identifying suitably
qualified persons to carry out the function.
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Conciliation/mediation procedures
Legislative provisions on conciliation procedures themselves tend to
be brief, leaving much to the discretion of conciliation institutions
and individual conciliators so as to allow flexibility in dealing with
widely varying situations. They may include provisions on:
- the exhaustion of any remedies existing under the applicable collective
agreements before conciliation commences;
- the choice of conciliator (or the composition of conciliation boards
or committees, where they are used);
- attendance at conciliation proceedings;
- time limits for conciliation;
- the status of a settlement reached through conciliation;
- what occurs in the event of a dispute remaining unresolved, and when
this is to be determined;
- the options then available to the parties, which may include referral
to other available dispute settlement procedures and the right to have
recourse to strikes or lockouts, and which may differ according to
the kind of dispute. The rules relating to recourse to strikes or lockouts
are dealt with in Chapter
V.
Conciliation/mediation may be a one- or two-stage process. Some systems
which provide for both individual conciliators or mediators and conciliation/mediation
boards also provide that disputes should or may be brought to a conciliation
board or mediator if the first stage of conciliation is unsuccessful.
Under some of these systems, certain kinds of dispute bypass individual
conciliation and are considered initially by a conciliation/mediation
board.
It can be important to identify accurately the moment when dispute
settlement procedures end, and whether or not they have been successful.
If the parties settle the dispute, this may mark the moment from which
the collective agreement becomes applicable. For these reasons, it is
appropriate to make provision for a formal means of concluding the dispute
settlement procedure and recording its outcome.
If the parties do not settle the dispute, the identification of the
moment when conciliation (or arbitration) ends is important with a view
to subsequent efforts to resolve the dispute. The parties may themselves
agree to submit the dispute to another settlement method. The legislation
may provide that the parties should be encouraged or requested to agree
to submit an unresolved dispute to binding arbitration. The legislation
may also require the conciliation authority to refer the matter to arbitration.
Finally, where the right to take industrial action depends on exhausting
the conciliation/mediation procedure, the end of the procedure marks
the time when such action may be taken.
It is also important to record the outcome of dispute settlement procedures,
particularly if there are to be further attempts to resolve the dispute.
The legislation may for example require a conciliator or conciliation
body to report in writing on the outcome.
Example
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Arbitration
Arbitration is a procedure for settling disputes by submitting them
to an independent and neutral third party for a final and binding decision,
which may be called an "award" or "decision". Arbitration
in some form has a place in most government labour dispute settlement
systems, and is also sometimes used voluntarily by the parties to settle
their disputes. It may be provided for under the terms of collective
agreements to deal mainly with rights disputes arising out of the agreement,
as is common in the United States and Canada, or to deal with interests
disputes, as sometimes occurs elsewhere.
Like conciliation, the submission of a dispute to arbitration may be
either voluntary or compulsory. Arbitration is voluntary when
it can be set in motion only with the agreement of the parties, and compulsory when
it can be invoked by either party or the government at its own initiative.
However, the submission of interests disputes to compulsory arbitration
is not common, except in essential services. Indeed, the imposition of
compulsory arbitration is not deemed to be in accordance with the principles
of freedom of association, other than in essential services or inexceptional
emergency situations.
In most countries, rights disputes are adjudicated by a court or tribunal,
except in the case of arbitration systems established by collective bargaining
for the settlement of disputes relating to the application of collective
agreements, which in any case function more like adjudication than arbitration
(see Disputes settlement procedures and the right to strike,
below, and Chapter
II).
Arbitration is most commonly used on an ad hoc basis, with individual
arbitrators being appointed or arbitration boards set up to deal with
specific disputes. Where arbitration boards are established, they usually
include representatives of both workers and employers. In the case of
both individuals and boards, ad hoc arbitration raises the question of
how to identify appropriate arbitrators for particular disputes as they
arise (see Establishment, functions, composition and operation
of disputes settlement institutions below).
Governments may also establish permanent arbitration tribunals, courts
or other bodies. The administrative support for such bodies is often
provided by the same services which support conciliation machinery, although
they may also have their own administrative services.
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Voluntary arbitration
Many systems of dispute settlement established by legislation make provision
for the voluntary submission of disputes to legally binding arbitration,
which is the most widely used form of arbitration. There are several
ways of encouraging and promoting voluntary arbitration, inluding:
- giving it a statutory basis;
- making arbitration awards legally binding on the parties;
- providing machinery and facilities for arbitration;
- providing that a conciliator should endeavour to persuade the parties
to submit the dispute to arbitration if conciliation is unsuccessful;
or
- empowering the conciliator to arbitrate a dispute with the consent
of the parties.
Where legislation makes provision for voluntary arbitration, it normally
requires the agreement of the parties to submit the dispute to arbitration.
This may be at any stage of the dispute after the competent authority
is cognizant of it or, as is commonly provided, if conciliation is unsuccessful.
Or this may simply be left to the parties to determine as part of the
content of their collective agreements.
In some countries, the legislation requires the conciliator or another
authority to submit the dispute to an arbitration procedure (thereby
making arbitration compulsory at its initial stage), although the parties
retain the right to reject the award or decision within a given period
after it is issued, thereby imparting a voluntary character to the award
or decision.
Legislation establishing voluntary arbitration procedures may provide
for the submission of disputes to the arbitration body by:
- joint request of the parties; or
- by the conciliation body with the consent or at the request of the
parties; or
- by the conciliation body or other authority, subject to the right
of the parties to reject the award after it is issued.
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Compulsory arbitration
Arbitration is compulsory when the dispute may be submitted for arbitration
without the agreement or consent of all the parties involved in it (whether
at the initiative of one of the parties, the government or an independent
agency), for the settlement of the dispute by a legally binding award.
It should be recalled that compulsory arbitration in interests disputes
is controversial, as it is usually associated with restrictions on the
right to strike and limits the freedom of the parties to bargain collectively.
Moreover, it is commonly assumed that compulsory arbitration undermines
collective bargaining and diminishes the willingness of the parties to
accept the compromises that are necessary for effective collective bargaining.
Careful consideration should therefore be given to whether the policy
reasons for introducing compulsory arbitration are sufficient to override
the obligation and undeniable value of promoting collective bargaining.
Moreover, as the success of compulsory arbitration in most countries
depends on the general support that it receives from the parties, consultations
should be held with the social partners before instituting such a system.
Compulsory arbitration of interests disputes is rare in the private
sector in industrialized countries, although not uncommon in the public
service. In many developing countries, compulsory arbitration is applied
in essential services and sometimes in cases of public emergencies. In
some of these countries, more general systems of compulsory arbitration
have been developed on the grounds that trade unions are not strong enough
to engage in successful collective bargaining and with a view to averting
work stoppages which such countries consider that they can ill afford.
Compulsory arbitration systems of limited application. Many
compulsory arbitration systems are of limited application. They may apply,
for example, only to disputes in essential services or in situations
of public emergency, in which cases the competent authority
may have the authority to refer disputes to compulsory arbitration (see Chapter
II).
Example
Some systems of compulsory arbitration are of general application.
In such cases, the legislation provides for the automatic referral of
disputes after the failure of conciliation or any other method for the
voluntary settlement of the dispute. In other cases, the legislation
provides that disputes must be submitted to compulsory arbitration at
the behest of the competent authority or on the application of either
party to the dispute. However, it should be emphasized that such provisions
are considered by the ILO’s supervisory bodies as constituting
violations of the principles of freedom of association, as they generally
entail a prohibition of strike action and are in vilation of the principle
of voluntary collective bargaining (General Survey, 1994, paras. 254-259).
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Arbitration procedures
In the case of voluntary arbitration, the legislation normally
requires the agreement of the parties to submit the dispute to arbitration.
However, in some countries the conciliation officer or another authority
may or must submit the dispute to arbitration, although the parties are
free to reject the arbitration award. In the absence of such rejection
within a given period, the award becomes binding.
Arbitration procedures are usually more formal than those applying
to conciliation. Nevertheless, the rules of procedure for arbitration
generally seek to ensure that cases are dealt with speedily and that
the proceedings are kept simple, especially by avoiding the formalities,
technicalities and legalism of judicial proceedings.
The respective legislation commonly provides that arbitration boards,
arbitration bodies or arbitrators, as the case may be, should act in
interests disputes in accordance with justice, equity or fairness, good
conscience and the substantial merits of the case. They also commonly
provide arbitration bodies with certain powers of investigation, which
may include:
- the power to require the submission of evidence in writing;
- the power to require the attendance of witnesses for the purpose
of giving evidence;
- the power to require the production of books and records;
- the power to call on the services of experts in financial or other
matters.
While in practice these powers may be invoked at the instance of a
party to the dispute, they may also be exercised by the arbitration authority
at its own initiative.
It is often desirable to require the arbitration body to indicate its
reasons for reaching a decision. If the award is legally binding, the
provision of the reasons for the award can help to make it more acceptable
to the parties and provide a more satisfactory basis for the settlement
of the dispute. The requirement that the reasons for a decision be indicated
is particularly important in systems where an award may be subject to
appeal or judicial review. A further reason for requiring an arbitration
body to give reasons for its decision arises in cases where the legislation
lays down criteria for making awards. In such cases, the provision of
reasons reveals whether or not the criteria have been properly taken
into account. On the other hand, it may also be appropriate to leave
this issue to the arbitration body itself.
One of the main reasons for using arbitration, and particularly compulsory
arbitration, is to avoid the delays usually associated with judicial
procedures. One of the main causes of such delays is the filing of appeals.
To avoid this, arbitration awards in interests disputes (at least, as
regards the determination of the merits of the dispute) are final and
cannot be appealed in a large number of countries. Conversely, specific
provision may be made for the parties to be able to appeal against arbitration
awards on points of law or issues relating to the authority of the arbitration
body itself. Another approach is to allow the arbitration body to seek
opinions on questions of law at its own initiative.
Example
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Establishment, functions, composition and operation
of dispute settlement institutions
There are many different ways of establishing dispute settlement institutions,
identifying appropriately qualified individuals to serve on such bodies
and selecting or appointing the individual or individuals to conciliate
or arbitrate any specific dispute. The wide variety of practices reflects
different national traditions and practices. However, it is important
to bear in mind a number of general themes relating to the legislation
establishing dispute settlement systems.
The basic questions are whether dispute settlement bodies should be
tripartite or not and whether they should be ad hoc or permanent. The
choices made may differ for bodies responsible for conciliation, mediation,
arbitration and adjudication. In the case of conciliation, they may be
composed of independent persons or ministry officials (perhaps with some
members from trade unions or employers), while mediation or arbitration
bodies may be tripartite and labour tribunals may be made up of independent
judges. The governing bodies of a conciliation/mediation/arbitration
body may be tripartite in composition and the personnel drawn from all
backgrounds. All of these various solutions are to be found in different
countries.
There are several benefits of tripartite representation in such institutions.
First, the parties to disputes often have greater confidence in tripartite
structures. Secondly, the involvement of representatives of workers and
employers in the dispute settlement process serves to enlist the practical
knowledge and experience of the employers and workers themselves for
the settlement of labour disputes.
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Establishment and functions of dispute settlement
institutions
The functions of permanent dispute settlement institutions may cover
the settlement of one or several types of disputes. In some cases, they
may also be assigned broader educational and advisory roles.
In some countries, a basic distinction is made between the conciliation
services provided either by officers of the ministry responsible for
labour or by a separate conciliation service, and adjudication by labour
courts or tribunals or ordinary courts. In contrast, arbitration is generally
undertaken by individuals or bodies set up on an ad hoc basis. In these
countries, the different roles are precisely defined, although conciliation
officers may have an advisory role in rights disputes before they are
referred for adjudication by the courts.
In other countries, independent dispute settlement bodies have been
established which centralize the functions of conciliation, mediation
and arbitration, although the parties remain free to have recourse to
mediators and arbitrators of their own choice. These bodies also normally
play an educational and advisory role.
In still other countries, while conciliation may be left to the officers
of the labour ministry, the arbitration and adjudication of labour disputes
are assigned to an industrial relations or arbitration tribunal or court.
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Appointment of members of dispute settlement institutions
Broadly speaking, there are three ways of appointing the members of
dispute settlement institutions, including the establishment of lists
or panels of conciliators and arbitrators who can be chosen for ad hoc
procedures. Two of these methods associate workers’ and employers’ representatives
in the selection of such persons:
- they may be appointed by the State (by the competent authority,
the Minister, a labour commissioner or the President), in accordance
with statutory criteria relating to age, qualifications and experience
in the field of labour relations;
- they may be nominated by workers and employers, by workers' and
employers' organizations directly, by the most representative organizations
of workers and employers, by organizations determined by the competent
authority or the Minister to be representative, or by the representatives
of the interests of workers and employers on an established national
tripartite institution;
- they may be appointed by the State from among persons nominated
by workers and employers, usually through their most representative
organizations, or the organizations determined by the competent authority
or the Minister as being representative.
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Selection of persons to settle specific disputes
Where dispute settlement is to be carried by members of an institution
or by individuals selected on an ad hoc basis for the purpose of conciliating
and/or arbitrating a particular dispute, there are again three broad
ways of identifying the persons involved, two of which involve the parties
themselves:
- the persons may be selected by the parties themselves, perhaps from
pre-established lists or panels. There may be a single list, different
lists of individual representing workers and employers, as well as
in some cases a list of independent persons. Where a single person
is to be selected and no agreement is reached, some method of resolving
the issue is needed, such as selection by the head of the institution
or a public authority.
- the persons may be designated by the State, or more specifically
by the competent authority, which may be the dispute settlement institution,
a labour commissioner or inspector or a labour tribunal.
- the persons may be designated by the competent authority from among
individuals nominated by the parties. The parties may select possible
candidates from previously established lists or panels of suitable
persons. In some cases, such panels may be established within already
existing conciliation or arbitration institutions.
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Status of dispute settlement personnel
It is important to take appropriate steps to ensure that dispute settlement
institutions are independent and that their members are seen to be persons
of appropriate standing and moral authority.
A common way of ensuring the independence of dispute settlement institutions
and their members, at least those who are not ad hoc members for the
purpose of specific disputes, is to appoint the members on a permanent
basis and to protect their employment in the same way as civil servants.
The internal structure of dispute settlement institutions is also important
in marking their independence and ultimately their moral authority to
engage in the settlement of disputes. This can be done, for example,
by creating senior positions for the personnel of such bodies, such as
a president or vice-president. These persons can be given responsibility
for running the institution, including the allocation of disputes among
the members, and can also be responsible for the performance of conciliation
or arbitration in particularly significant or difficult disputes.
A final matter to be taken into account which can also strengthen the
independence and authority of dispute settlement institutions consists
of the qualifications required for the more senior personnel. For example,
the head and senior members of compulsory arbitration bodies are commonly
accorded a status similar to that of judges, and may need the same experience
and qualifications as judges to be eligible for appointment.Requirements
of this nature help to invest the officers and their institution with
a certain moral authority.
Example
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Dispute settlement procedures and the right to strike
One of the main justifications for requiring the parties to refer labour
disputes to dispute settlement mechanisms is to prevent industrial action
in view of the the adverse social and economic effects that it can have
in the wider community. This is sometimes reflected in a legislative "peace
obligation".
At the same time, it must be borne in mind that the right to take industrial
action, and particularly the right to strike, is a fundamental corollary
of the right to organize (see Chapter
II). It is therefore essential to achieve an appropriate balance
between the benefit of resolving disputes peacefully and respect for
the autonomy of the parties to engage in collective bargaining, supported
by the fundamental right to take industrial action in support of their
economic and social interests.
In practice, labour dispute settlement mechanisms may be linked to limitations
on the right to take industrial action in several ways. The legislation
may require the parties to give advance notice of any planned action
to a conciliation authority. In addition, the parties to disputes might
be required to attempt to resolve their dispute through conciliation
as a precondition to the exercise of their right to take direct action.
In such cases, industrial action is only legal once the parties have
completed this step.
The question of which labour disputes may properly give rise to the
right to take direct action offers another link between labour dispute
settlement procedures and industrial action. It is usually only disputes
about interests that are left to the parties to resolve for themselves
through the use of their industrial strength where they deem it necessary.
Direct action is not generally permitted in the case of rights disputes
that are to be resolved by adjudication.
However, in accordance with the principles of freedom of association,
disputes about interests should not be so narrowly defined as to prevent
solidarity strikes or strike action on broad economic and social issues
(see Chapter
II).
1. In addition to legislative texts
and ILO instruments, the sources used in the preparation of this chapter
include: ILO, Date, place and agenda of the 89th Session (2001) of
the Conference, Document GB.274/3 (ILO, Geneva, March 1999), paras.
123 to 189; Blanpain and Engels (eds.), Comparative labour law and
industrial relations in industrialized market economies, 6th and
revised edition (Kluwer International, 1998); Labour relations in
industrialized market economy countries: An introduction (ILO, Geneva); Conciliation
and arbitration procedures in labour disputes: A comparative study (ILO,
Geneva, 1980); A. de Roos and R. Jagtenberg, Settling labour disputes
in Europe (Kluwer, 1994); and Guide to international labour
standards on industrial relations (ILO, Budapest, 1998). Other useful
references include: Grievance arbitration: A practical guide (ILO,
Geneva, 1989), Voluntary arbitration of interest disputes: A practical
guide (ILO, Geneva, 1984); and Conciliation in industrial disputes:
A practical guide (ILO, Geneva, 1988).
Updated by MB. Approved by AB. Last Updated
10 December 2001.
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