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"Good" arbitration vs. "bad" arbitration?



Jim Copland in the Washington Examiner:

The bill specifies that if management and labor were unable to agree to a contract after 120 days, the government's arbitrators would step in and mandate labor terms under "contracts" that would be binding for two years. ... The arbitrators' decision would be final, with no possibility for judicial review.

Card Check places no limits on the Labor Department's discretion, so nothing prevents the mandates drawn up by arbitrators from deviating far and wide: Business might be barred from outsourcing processes or from merging with other companies, and they might be compelled to support "community" groups or meet "green" targets. The difficulties in government involvement in business decisions, made obvious in the financial- and auto-industry bailouts, would be magnified throughout the private economy.

Lest one think that the Democrats backing Card Check are favorably disposed to arbitration in general, realize that another of their top legislative priorities - at the behest of a different special interest, the trial lawyers - is to gut the Federal Arbitration Act to prevent consumer arbitration.

The same legislative leaders, then, are supporting legal changes that would prohibit businesses and consumers from agreeing to arbitrate their disputes but would require businesses and labor to submit to arbitrators' decisions.

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Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Katherine Lazarski
Press Officer,
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.