Arbitration

The Arbitration Project

As part of its efforts to improve ways of responding to grievances, the Office proposed in its 2019 Annual Report (consistent with its Annual Reports of 2017 and 2018) that, on an interim basis, “the five [funds and programmes] organizations support the development of a specialized training programme and the provision of other arbitration access services.” To that end, the Office periodically conducts global arbitration webinars to raise awareness of the complexities involved in the arbitration proceedings and the benefits of informal resolution. Consistent with its commitment, the Office also established two lists—the Counsel List and the Arbitrators List—that include experienced professionals, selected by the Office according to stringent standards, who are available to work on disputes involving non-staff personnel on a pro-bono or reduced-fee basis. These lists are recommended for use by non-staff personnel and their UN organizations to assist them in finding qualified counsel and arbitrators in case of disputes between them. The Office is not engaged in managing or administering arbitrations.

As per its mandate that includes “address[ing] work-related issues through … providing … information”, “exploring a range of options,” and “advis[]ing and mak[ing] suggestions or recommendations, as appropriate, on actions needed to settle conflicts” (see para 3.15-3.16 of the ToR, ST/SGB/2016/7) the Office provides information, inter alia, related to arbitration as one option to resolve disputes involving non-staff personnel and explores informal options to settle those. In addition, the Office encourages parties to seriously consider mediation prior to resorting to arbitration. To that end, as part of this project, the Office has developed an arbitration pledge, which counsel and arbitrators have committed to. The arbitration pledge includes the following requirement:

  • For counsel: I will strongly encourage my client to consider mediation as the first step to resolve the conflict and will seriously consider an invitation of the other party and/or arbitrator(s) to mediate the matter.
  • For arbitrators: I will strongly encourage the parties to consider mediation as the first step to resolve the conflict. As Arbitrator, in case any of the parties declines to mediate the dispute without valid reasons, I will request a substantiated statement to that effect and will seriously consider the reasons contained in such statement or lack thereof when deciding the award of costs.

To learn more about mediation and its benefits, please visit our mediation page. You can find useful materials on mediation, including a mediation guide, mediation newsletters, interviews by our mediators within the “Peace at work” project, the profiles of our mediators, and much more.

The Mediation Unit has prepared a comprehensive Arbitration Guide, which will be available to non-staff personnel and their organizations upon request in case of an emerging or pending dispute. If you are a non-staff colleague or represent one of the five agencies in a process that may lead to arbitration, please reach out to the Mediation Unit of the Office of the Ombudsman to obtain the Arbitration Guide, which also includes the Global Arbitration Counsel List and the Global Arbitrators List.

What is Arbitration?

Arbitration is a formal dispute resolution process, agreed upon by all parties, in which one or more arbitrators make a decision that is binding on the parties. Arbitration follows specific arbitration rules, chosen by the parties. The arbitrator´s decision is subject to limited appeal mechanisms. In the United Nations context, arbitration is the only formal mechanism included in non-staff contracts to resolve disputes. This means that in case of a dispute the non-staff member and the organization will determine all the features of arbitration.

The following are the key principles of arbitration and how they apply for the funds and programmes agencies:

  • Consent

Arbitration is only an option if both parties have agreed to it. In the five agencies, all non-staff contracts include arbitration clauses, which means the parties have agreed to arbitration in advance.

  • The Parties Choose the Arbitrator(s)

Normally, the parties can choose the number of arbitrators as well as who the arbitrator(s) will be. Both parties pay for the costs of such arbitrators. In addition to the selection of arbitrators, the parties also choose the applicable law, the language, and venue of the arbitration, among others.

  • Neutrality and Independence

Arbitration is a neutral process in all contexts. This means that arbitrators do not take sides and cannot be biased toward one or another party. They must be neutral and independent throughout the entire process.

The Role of the Arbitrator

The arbitrator is an impartial and independent third party appointed by the parties. He or she will hear each party´s case and apply the relevant laws and rules to make a ruling, which is called an “arbitral award”. The arbitration award is final and binding on the parties and can only be appealed in certain situations. Unlike a judge, the arbitrator is chosen by the parties. Non-staff personnel can choose their arbitrators from the recommended Global Arbitrators List, for which they can reach out to the Mediation Unit of the Office of the Ombudsman.

Costs and Time

Compared to mediation, arbitration typically is an expensive and lengthy process. While mediation takes, on average, from 8-16 hours, arbitration takes months and even years. Unlike the mediation services provided by the Office, which are free, arbitration services are usually fee-based. Each arbitrator and counsel have their own fees, depending upon their experience and the area in which they are practicing. Arbitrators and counsel chosen for the Global Arbitrators List and the Global Arbitration Counsel List, however, have agreed to conduct at least one pro-bono or reduced-fee case to facilitate the costs for non-staff personnel.

Typically, each party pays for their own lawyer, and the parties split the cost of the arbitrator´s fees and expenses. However, under the UNCITRAL Rules that apply to arbitrations between non-staff and their organizations, the costs of the arbitration are, in principle, borne by the losing party. Although arbitrator(s) have the discretion to apportion the arbitration costs at the end of the case, parties need to be mindful of their potential cost exposure prior to engaging in the process. As opposed to arbitration, mediation services provided by the Office of the Ombudsman are free.

Before you file

Before filing a claim, the parties are strongly encouraged to consider resolving their dispute amicably through mediation. In fact, all non-staff contracts of the five agencies provide for an effort to reach amicable settlement before filing for arbitration. This suggestion is made with good reason, because mediation comes with a lot of benefits. Most importantly, mediation is free for all personnel and is significantly quicker than arbitration, so it can save significant financial resources and time.

Contact us

The Mediation Unit of the Office of the Ombudsman for United Nations Funds and Programmes

304 East 45th Street
6th Floor, Room FF-671
New York, NY 10017
USA

mediation@fpombudsman.org