IS THERE A BIAS IN ARBITRATION OF NONUNION EMPLOYMENT DISPUTES? AN ANALYSIS OF ACTUAL CASES AND OUTCOMES

Abstract

This paper uses 1992 nonunion employment arbitration awards to examine how parties currently use arbitration outside collective bargaining. It presents descriptive data on the costs of arbitration. It compares employer and employee claims, and finds that employees win higher damage awards. Employees recover a higher proportion of the damages they claim or have a better outcome than employers, notwith‐standing the theory that an arbitrator will rule in favor of employers because they have more resources to pay the arbitrator. While both employers and employees have lower outcomes when the arbitrator is paid a fee, this appears to be because the fee‐paying cases are higher stakes claims, and higher stakes claims result in proportionally lower damage awards. The findings tend to contradict the theory that employment arbitrators will be biased in favor of employers in a nonunion setting.