Labor & Employment Newsletter

April 2012
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Jeffrey T. Zaino, Esq.

Are all labor arbitrators alike?

By Jeffrey T. Zaino, Esq., vice president, American Arbitration Association*

How labor arbitrators in Massachusetts and nationwide manage an arbitration case, decide cases and bill for their time varies significantly. Unlike court proceedings, however, you and your counterpart to a labor arbitration proceeding have the benefit of being able to select the decision maker. Selecting an arbitrator is one of the most important, if not the most important, decision you will make during the life of your case. Careful and thoughtful consideration should always be applied. This article provides some practical tips on how to select the right labor arbitrator for your case.

General Needs and Case Requirements

You must first determine the general needs and requirements of your case. This will allow for you to determine how much flexibility you have with respect to selecting an arbitrator. The starting point should always be the arbitration clause contained in the collective bargaining agreement (CBA). This clause may contain specific arbitrator background requirements and steps on how the selection process should be completed. Some CBA arbitration clauses, for example, require that the arbitrator be a member of the National Academy of Arbitrators (NAA), a national organization of arbitrators that have specific high standards for applying and being a part of that organization. Section (2) of the NAA Statement of Policy to Membership notes, "[t]he applicant must have substantial and current experience as an impartial arbitrator of labor-management disputes."

If a CBA requires that you utilize an administrative agency like the American Arbitration Association (AAA), you will most likely use an arbitrator that is a panelist from that agency.  Most agencies have a vetting process and specific standards for admission to their panel. The AAA, for example, requires a minimum of 10 years of labor management experience and nine references. The references must come from both union and management advocates and neutrals. It is important to the AAA that the applicant be well known in the labor-management community that he or she might serve.

Specific Needs

The type of case and its facts should also be considered when selecting an arbitrator. Will you need an arbitrator that has a specific industry background to understand the facts of your case or is the grievance more general to all industry types? Are there issues better suited for an attorney arbitrator? Or, would a non-attorney arbitrator look at the case differently and bring a different approach to the process? Would an academic arbitrator be better? There are many arbitrators that are professors. The approximately 200 labor arbitrators in Massachusetts come from a wide variety of backgrounds.

Cost Analysis

The arbitrator per diems, cancellation fees, travel expenses, and study time rates vary significantly. The per diem rates range anywhere from $800 to $2,000 per day, a significant cost difference from the lowest to highest per diem rate. Thus, arbitrator fees must be carefully considered when selecting an arbitrator.  If there is a likelihood that your case will settle but only if the parties are faced with the pressure of a scheduled hearing date, arbitrator cancellation fees and policies must also be taken into consideration. Like per diem rates, cancellation policies vary from 10 to 30 days before the scheduled hearing.

Does the arbitrator have a practice of billing numerous study days? Study day billing practices can also make a significant difference in overall arbitration costs. Arbitrators and advocates must understand that there is no formula for billing study time (i.e., for each day of hearing an arbitrator can bill X amount). Study time billing should only be based on actual time reviewing the case documents, deliberating and preparing the decision.

Finally, if you anticipate that the arbitrator will need to travel a far distance to attend the hearing or you opt to use an arbitrator from outside of Massachusetts, you should also review the travel policy of the arbitrator. Some out of state arbitrators might waive travel fees if they are seeking to make inroads in other states.

Research

Once you determine the type of arbitrator you want, you can then begin researching those available or listed as potential options for your case. First, a careful review of the arbitrator's resume should be completed. Most arbitrators provide detailed resumes including education, industry experience, and all fees associated with their service. Second, if possible, speak with colleagues that have gone before this arbitrator in the past. Word of mouth seems to be the most common method of research by advocates. Third, review past decisions by the arbitrator. LexisNexis and Westlaw contain thousands of full decisions redacted from labor arbitrators nationwide. Reading these decisions will provide a sense of how the arbitrator will manage your case and provide insight on the arbitrator's analysis of various issues. Unfortunately, many advocates are unaware that there an abundance of past decisions available for review.

The Case for Using New Arbitrators

Finally, there is a strong argument for selecting and utilizing a new arbitrator, particularly when it comes to less complicated caseloads. These "new" arbitrators are generally not "new" to the labor-management community. Most have 20 to 30 years of experience in the labor-management field as advocates and have been carefully vetted in order to serve as a neutral. Second, they are often more available and less expensive than their seasoned counterparts. Third, and in the interest of the process as a whole and its future, we need to bring up the next generation of labor arbitrators. Don't forget that the seasoned arbitrator that you prefer to use regularly was once also a new arbitrator.

Conclusion

In addition to arbitration being an efficient and economical process in comparison to litigation, there is the added benefit of being able to select your decision maker. With that benefit, however, comes the important responsibility of selecting the right arbitrator for your case. Doing your homework and understanding that all labor arbitrators have unique backgrounds and skills will greatly assist your efforts. 

*Jeffrey T. Zaino, Esq. is the vice president of the Labor, Employment and Elections Division of the American Arbitration Association in New York and oversees the operations, development and panel of arbitrators for the Labor and Employment Arbitration caseloads. Zaino is dedicated to promoting ADR methods and neutral election services for our nation's unions, associations, corporations, and colleges. His professional affiliations include the Connecticut Bar Association, District of Columbia Bar Association, New York State Bar Association and New York City Bar Association. He has also written and published extensively on the topic of election reform and has appeared on CNN, MSNBC, and Bloomberg to discuss reform efforts and the Help America Vote Act.

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