Conciliation, Arbitration, Adjudication, Employee Relations, MS-24

Distinguish between conciliation, Arbitration and adjudication. Which of these procedures is being used in your organization or any organizational you are familiar with. Give reasons why this particular procedure is being used. Briefly describe the organization you are referring to.

Conciliation:- Conciliation is a process by which a third party assists the parties to resolve their dispute by agreement. A conciliator may do this by expressing an opinion about the merits of the dispute.
•    How does conciliation differ from other dispute resolution processes? Conciliation is similar to mediation in that the role of the conciliator is to assist the parties to reach an agreed resolution. Unlike mediation, a conciliator will express an opinion about the merits of the dispute. Unlike arbitration and expert determination (and litigation), the conciliator does not decide the disputs for the parties.
•    Conciliation can provide a quick, cheap, confidential means of resolving disputes.
Conciliation, as opposed to mediation, can be useful where one of the parties has
unrealistic expectations about the dispute and a more pro-active approach to the merits
may assist in resolving the matter.
Conciliation may also be useful where the parties wish to have their dispute resolved by
objective considerations of what is appropriate, rather than purely by agreement between
the parties.
•    Conciliation can be used with a broad range of disputes.
•    It is best to conciliate as soon as possible. If conciliation occurs early, positions have not become entrenched and expense has not been incurred.
•    The cost of conciliation depends on the nature of the dispute and the number of parties involved. It also depends on any additional work performed by the conciliator eg providing a formal opinion. In general, however, a dispute resolved through conciliation will have involved less expense than resolution through litigation.
•    The process followed is similar to the process for a mediation, involving discussion between the parties. A conciliation may focus more on the merits of the parties' positions. The parties may provide information to the conciliator to enable the conciliator to give an opinion about issues in dispute or the parties positions. The approach to be taken by the conciliator is something which will be discussed at the initial preliminary meeting.
•    Parties to conciliation proceedings will have signed a formal agreement regulating the process. Included in the agreement will be provisions requiring the parties to maintain the confidentiality of information disclosed in the conciliation.
•    Parties are best able to negotiate if they know what their rights and obligations are, before and during the process.

Arbitration:- Arbitration occurs where parties agree to have a third party, the arbitrator, determine a dispute which has arisen between them.
In Western Australia, arbitration is governed by the Commercial Arbitration Act, 1985. A copy of the Act can be obtained from An arbitrator's determination is called an "award". A party to arbitration can apply to the Court to have the award determination registered as a judgment of the Court.
•    Arbitration differs from litigation in that it is consensual: the parties must agree to resolve their dispute by arbitration. Unlike mediation or conciliation, an arbitrator decides the dispute. Generally, an arbitrator may only act on material provided by the parties. A table showing the differences between arbitration and other dispute resolution processes can be found here, download PDF version or RTF version.
•    Arbitration can be quicker, simpler and less formal than litigation. Arbitration is also more private that court proceedings. Members of the public and representatives of the media cannot attend arbitration proceedings and listen to the evidence. Parties can agree that the outcome of the arbitration shall be confidential.
•    Generally, parties to arbitration are assisted by retaining lawyers to represent them. An arbitrator will not provide legal advice to the parties about their position.
•    An award made by an arbitrator can be registered in the Supreme Court and enforced in the same way as a Supreme Court judgment.
•    Arbitrators' decisions on questions of fact are final and binding. It is possible to appeal an arbitrator's decision on a question of law made by an arbitrator, but only with permission from the Court. The grounds on which permission will be granted are limited.
•    The parties bear the costs of an arbitration, including the arbitrator's fees. The arbitrator can order an unsuccessful party to contribute to the successful party's legal costs, as in court proceedings. Expert Determination
•    In expert determination, the parties get an independent third party, who is expert in a particular field, to adjudicate on a dispute within the field of expertise.
•    An expert determination is similar to arbitration in that the expert makes a determination of the issues, rather than getting the parties to agree on the resolution of the matter, as in mediation. Unlike a court, an expert making a determination can take into account his knowledge and expertise.

•    Expert determination is suitable for determination of 'simple' issues requiring technical expertise or evaluation, such as the value of a piece of land, or the amount of notice to which an employee is entitled. Expert determination is sometimes used where the parties want to reduce the chance that the decision will be appealed or the process contested.
•    Expert determination can avoid the need for a formal hearing, which can make it both cheap and efficient. There are very limited avenues for challenging a decision made by an expert appraiser.
•    The cost depends on the nature of the dispute and the approach of the parties and the expert. Because the procedure can be very informal, and the parties do not generally put evidence to the expert, the process should be cheaper than determination the same issue in court or by arbitration.
•     The procedure for an expert determination is largely a matter for the parties, or, if they
make no agreement, for the expert.

The expert determination process is very flexible. Generally, it involves:
(1) a meeting between the expert and the parties about the conduct of the determination;
(2)     the     provision     of     information     to     the     expert     by     the     parties.
(3) a determination by the expert.
•    The parties may agree that all aspects of the process and the outcome shall be confidential. Scott's standard expert determination agreement can be accessed here.
•    Generally, parties to an expert determination are assisted by retaining lawyers to represent their interests. An expert determiner does not provide advice to parties about their legal position.
This depends on the particular process chosen for the expert determination. Generally, it will be necessary for background information to the provided to the expert to assist in the determination. It is not usually necessary for the parties to give oral evidence.

Adjudication:- Adjudication is the process for rapid resolution of disputes about payment for construction work in Western Australia established by the Construction Contracts Act, 2004.
•    Only claims made under a "construction contract" can be dealt with by this process. The definition of "construction contract" in the Act includes contracts for construction work, the supply of goods to site, the provision of related professional and on site services. Claims include both claims by a contractor for performance of work and claims by a principal against the contractor.
•    Adjudicators may be nominated in the contract, selected by the applicant or selected by a "prescribed appointor" under the Act. Adjudicators must be registered under the Act.

The procedure for adjudications is set out in the Act and the Construction Contract Regulations, 2004. Potential claimants should seek separate advice concerning these requirements. In broad terms, an application must be served on all the parties to the contract and the adjudicator or appointing body within 28 days after a payment dispute arises. This time limit cannot be extended. If the claim is not made within 28 days, a claimant cannot pursue adjudication under the Act in respect of that dispute. However, this does not stop the claimant suing in court or commencing arbitration proceedings. The respondent then has 14 days within which to respond. The determination must be made within 28 days after the initial application (unless the parties agree to extend time). Generally the determination will be made on the basis of the parties' written application and response.

An adjudicator's determination may, with the permission of the Court, be enforced like a Court judgment.
Generally there is no right of appeal from a determination of an adjudicator under the Act.   However,  if there are any further proceedings between the parties (such as arbitration or litigation), the parties are not bound by the adjudicator's determination. Generally parties to a dispute are assisted by lawyers.   The adjudication process is, however, intended to be informal and simple.
The costs of the process overall depend on the complexity of the claim and the amount of material submitted by the parties. Generally, the parties must pay their own costs and must share the adjudicator's costs.