QUESTION

There had been industrial unrest in certain work places when the government announced the

minimum wages for domestic and shop workers which resulted in some employers threatening

with dismissal of their employees who demanded to have their wages and salaries adjusted in

accordance with the recent statutory instrument on the minimum wages and salaries for domestic

and shop workers.

(a) Explain the available process and the rationale for ADR in employment disputes.

(b) You have been appointed as an arbitrator in a dispute. Kindly outline the quality you need to

have and how the process of arbitration would be conducted and if a party is not satisfied

with your award, what recourse is available to them?

1
INTRODUCTION

Alternative Dispute Resolution is a procedure for settling a dispute by means other than
litigation, such as arbitration or mediation.1 This system uses not one but a variety of techniques
or processes for resolving conflicts without resorting to conventional litigation. Notwithstanding
the fact that the name is called alternative, many people do resolve disputes in the alternative that
in conventional courts. ADR techniques have not been created to undercut the traditional court
system. Certainly, ADR options can be used in cases where litigation is not the most appropriate
route. However, they can also be used in conjunction with litigation when the parties want to
explore other options but also want to remain free to return to the traditional court process at any
point. The processes used to resolve conflicts in ADR include; mediation, conciliation,
negotiation, Arbitration, early neutral evaluation (ENE), Med-Arb, Judicial settlement, Mini –
Trial, Summary Jury Trial (SJT), inter alia.

This academic paper embarks on explaining the available ADR process in employment disputes
and rationale for ADR in employment disputes. Secondly the paper will outline the qualities one
needs to have as an arbitrator and how the process of arbitration would be conducted and the
recourse available to a party who is not satisfied with the award.

THE ADR PROCESS USED IN EMPLOYMENT DISPUTES

It is more beneficial for parties to resolve their differences by negotiated agreements rather than
through the contentious proceedings because the most effective system of dispute resolution
consists of a method which increases the reconciliation of interests. 2 ADR provides a variety of
processes through which a dispute can be resolved through a negotiated agreement. Among the
ADR processes that can be employed in resolving employment disputes include, conciliation,
mediation and arbitration. In all these processes a third party can be engaged to solve a dispute
between an employer and an employee. 3 However, this assignment shall focus on arbitration as a
process of resolving employment disputes.

1
Garner, B.A. [Ed.]. [2004], Black’s Law Dictionary [8th Ed.], St. Paul: West Publishing Co. at P86
2
Kovach, k. [1994], Mediation Principles and Practice. St Paul Minn: West Publishing Co. Pg 5
3
https://www.gov.uk/solve-workplace-dispute/mediation-conciliation-and-arbitration

2
WHAT IS ARBITRATION

Arbitration is the determination of a dispute by one or more independent third parties (the
arbitrators) rather than by the court. Arbitrators, who may be seating as an arbitral tribunal, are
appointed by the parties in accordance with the terms of the arbitration agreement(An arbitration
agreement is a contract in which you agree to bring any legal claims you may have against your
employer to arbitration, rather than filing a lawsuit in court) 4 or in default by a court. An
arbitrator is bound to apply the law accurately but may in general adopt whatever procedure he
chooses and is not bound by the exclusionary rules of the laws of evidence; they however,
conform to the rules of natural justice.5 The judgment of an arbitrator is called an arbitral award
and the parties stipulate in advance that the award will be binding, in which case the award is
enforceable in the same manner as any contractual obligation or court order. 6 Arbitration is
generally used where the parties seek a neutral case evaluation by experts, coupled with an
enforceable and specific award. 7

Arbitration can be either voluntary or mandatory (although mandatory arbitration can only come
from a statute or from a contract that is voluntarily entered into, where the parties agree to hold
all existing or future disputes to arbitration, without necessarily knowing, specifically, what
disputes will ever occur) and can be either binding or non-binding. Non-binding arbitration is
similar to mediation in that a decision cannot be imposed on the parties. However, the principal
distinction is that whereas a mediator will try to help the parties find a middle ground on which
to compromise, the (non-binding) arbitrator remains totally removed from the settlement process
and will only give a determination of liability and, if appropriate, an indication of the quantum of
damages payable. By one definition arbitration is binding and so non-binding arbitration is
technically not arbitration.8

4
www.nolo.com
5
Martin, A.E. and Law, J. (Eds.) (2009), Oxford Dictionary of Law (7th Ed.) Oxford: O U P. at Pg40.
6
Sullivan, Arthur; Steven M. Sheffrin (2003). Economics: Principles in action. New Jersey:
Pearson Prentice Hall. P. 324.
7
Chanda, H.N. (2008), Module LL 27: Alternative Dispute Resolution. Lusaka ZAOU at p. 7.
8
Arbitration. (2015, September 17). In Wikipedia, The Free Encyclopedia. Retrieved 13:22,
October 27, 2015, from https://en.wikipedia.org/w/index.php?title=Arbitration&oldid=681534187

3
The arbitrator is usually selected from a panel of available arbitrators or may have already been
agreed upon in the arbitration clause. Once the matter has been submitted to the arbitrator, the
arbitrator will contact all parties. A schedule will be set, which includes when all documents
must be exchanged, when all witnesses must be disclosed, when arbitration briefs are to be
submitted, and where and when the hearing will be conducted. A preliminary meeting will be
held at arbitrator's request. This may be a joint session with all parties present or may be
conducted by telephone conference. At the arbitration hearing, each of the respective parties is
allowed to present evidence. After review of the evidence, the arbitrator will make an
"arbitrator's award.” After the arbitrator's award has been issued, the prevailing party often has
the ability to have it issued as an enforceable court order. 9 Arbitration is applied, particularly
now, with regard to individual employment disputes concerning unfair dismissal. Arbitrators can
make awards binding on all parties. By entering into an arbitration agreement, parties would
contract out of the jurisdiction of the employment tribunals.10

In Zambia the law that provides for matters to do with arbitration is the Arbitration Act. 11 The
Act repeals and replaces the old Arbitration act with provision for domestic and international
arbitration through the adoption, with modifications, of the Model Law on International
Commercial Arbitration adopted by the United Nations Commission on International Trade Law
on the 21st June, 1985. Its objective is to provide for an arbitral procedure which is fair, efficient
and capable of meeting the specific needs of each arbitration; to redefine the supervisory role of
courts in the arbitral process; to preserve the legal recognition and enforcement of foreign
arbitral awards under the Geneva Protocol on Arbitration clauses (1923) and the Geneva
Convention on the Execution of Foreign Arbitral Awards (1927); to provide for the recognition
and enforcement of foreign arbitral awards under the New York Convention on the Recognition
and Enforcement of Foreign Arbitral Awards (1958); and to provide for matters connected with
or incidental to arbitration. According to Section 6, any dispute which the parties have agreed to
may be determined by arbitration.

9
Law Reform Commission (2008) Consultation Paper on Alternative Dispute Resolution at Pg51.
10
Chanda, H. N. at Pg45.
11
The Arbitration act of Zambia No. 19 of 2000.

4
However, the following matters cannot be determined by arbitration. These include, such matters
as, agreement contrary to public policy,12 criminal matters except where permitted by written law
or court grants leave for the matter to be determined by arbitration, 13 matrimonial causes;14
determination of paternity, maternity or parentage of person;15 or matters affecting the interests
of minors or individuals under a legal incapacity, unless they are represented by a competent
person.16

Unless the parties agree, arbitration does not involve pre-trial discovery. The arbitration hearing
is usually more informal than a court proceeding and the rules of evidence are not strictly
applied. Most individuals would like the option for an appeal in the event a ruling is not in their
favour. This option for an appeal is more than probable in the course of litigation; however, with
arbitration the options for appeals are virtually nil. 17 However, a party can have recourse in cases
of corruption, fraud, or other circumstances that would affect an arbitrator’s ability to remain
impartial. Where an application is made to the High Court on the grounds mentioned above,
litigation is obviously used for dispute resolution. On the one hand, one or both parties may be
dissatisfied with the result and thus opt for new arbitration proceedings before a different
arbitrator, thereby incurring more costs. Setting aside of an arbitral award by the High Court was
clarified in the case of Zambia Telecommunications Co. Ltd v Celtel Zambia Ltd 18where an
arbitral award was set aside in the High Court upon an application by the dissatisfied party
contending that the Chairman of the tribunal had accepted to be on another tribunal without
declaring interest, a situation that affected his ability to be impartial. The Supreme Court upheld
the decision of the High Court and declared that the chairman’s action was against public policy.

THE RATIONALE FOR ADR IN EMPLOYMENT DISPUTES

Although attention tends to be focused on the courts as the forum for resolving conflicts when
they arise, the court system is not necessarily the most effective way of deciding disputes,
12
Section 6 (2) (a) ibid
13
Section 6 (2) (c) ibid.
14
Section 6 (2) (d) ibid.
15
Section 6 (2) (f) ibid
16
Section 6 (2)(G) ibid
17
A Marriot [2002], Mandatory ADR and Access to Justice. Westbury: Foundation Press. Pg 54
18
SCZ/34/2008 [Unreported]

5
especially those which arise between people, or indeed businesses, which have enjoyed a close
relationship. Court procedure tends to emphasize and heighten the degree of conflict between the
parties, rather than seek to produce a compromise solution. 19 Therefore, ADR provides a good
platform for employment disputes to be resolved without antagonizing the employer and
employee relationship. The following points validate the use of ADR in employment disputes.

Concilliation of the Parties

In the first place, employers and employees are in a special relationship, which will invariably
have to continue after the dispute has been resolved and many people are affected by an
employment dispute: the employers, the employees, their families and sometimes even the
surrounding geographical area or associated industries. In this regard, it is generally accepted
that the best solutions to disagreements between employers and employees are those arrived at
through negotiated agreement usually through an element of mutual give and take. Such
agreements can be tailored to the needs of the parties, rather than imposed upon them. This
creates the optimum condition for a satisfactory continuing working relationship, whereas
litigation is more likely to lead to a hostile working environment. Therefore, making an agreed
settlement is the most desirable outcome. ADR provides a platform for employment disputes
that enables disputants to reconcile and accept the outcome of the process thereby maintaining
their relationships.

Flexibility

Further, ADR is gives the disputants to an employment dispute an opportunity to choose who to
resolve the dispute. The parties can select the arbitrator or mediator or conciliator who will hear
their case, typically selecting someone with expertise in the substantive field involved in the
dispute. In the case of arbitration, the parties have far more flexibility to select the arbitrator and
what procedural and discovery rule will apply to their dispute (they can choose to apply relevant
19
P. 69.

6
industry standards, domestic law, the law of a foreign country and so on) and then the arbitrator
makes the arbitral award which is binding on both parties. 20 Equally parties find it easy to
participate and tell their side of the story and have control over the outcome than normal trials
overseen by judges. Many parties desire the opportunity to speak their piece and tell their side of
the story in their own words rather than just through counsel. 21 This in turn makes the outcome
more satisfying to both parties. The award made speaks to the facts as they had transpired and
the law that is supposed to be applied hence the parties are more likely to respect the decision
made.

High Level of Confidentiality

Furthermore, ADR is preferable in employment disputes due to the high levels of confidentiality.
Most of the ADR methods are held in camera or parties may agree that the information during
the negotiations or arbitration hearings cannot be used later even if litigation ensues and the
outcomes cannot be published to the public. This in turn does not tarnish the images of the
disputants regardless of the outcome of the dispute. This is equally very important when
considering maintaining of relationships because if certain information was published by the
employee about the employer, it is more likely that the relationship will be terminated after the
conflict has been resolved.

Cost Effective

ADR is an effective dispute resolution which is not as costly as conventional litigation. Lawyers
and expert witnesses are very expensive in Zambia, consequently, litigating a case can easily run
into a lot of expenses.  The cost of legal fees multiply with the years, lower the profitability of
any business involved in litigation and risk becoming disproportionate to the issue or claim at

20
http://www.albrightstoddard.com accesses 28 September 2015.
21
http://www.albrightstoddard.com

7
stake. Alternative dispute resolution hence, offers the benefit of getting the issue resolved
quicker than would occur at trial and that means less fees incurred by all parties.

Speedy Resolution of Disputes

Equally ADR resolves an employment dispute without wasting time so that the disputants can
easily go back to work. For instance in arbitration, in a matter of hours, an arbitrator can hear a
case that otherwise may take a week in court to try with live witnesses. The evidence also can be
submitted by documents rather than by testimony presented through witnesses. Further, ADR can
be scheduled by the parties and the panellists as soon as they are all able to meet together.22

QUALITIES OF AN ARBITRATOR

As shown above, in Zambia the Arbitration Act provides for matters to do with arbitration. This
includes procedure and the qualifications for an arbitrator. The parties are free to determine the
mode of appointing the arbitrators and the number. According to Section 12 of the Act a person
cannot be prevented from acting as an arbitrator on the basis of that person’s nationality, gender,
colour, or creed.23 In terms of appointing arbitrators, the legislation gives the authority to the
parties of a dispute to appoint arbitrators of their choice unless in circumstances where they fail
to do so that is when an arbitral institution can appoint on their behalf after an application if
made by one of the parties. 24 In this case, the arbitral institution has to appoint an arbitrator or a
panel with due regard to the qualifications stipulated in the arbitration agreement between the
parties.

Further, the Act gives power to the parties to appoint an arbitrator with qualifications of their
choice. The arbitration agreement made by the parties has to stipulate clearly the qualifications
that the parties have agreed that the preferred arbitrator should possess. This is aimed at securing
an independent and impartial arbitrator to prevail over the dispute so that the arbitral award is
accepted by both parties. The Act states that:

22
http://www.albrightstoddard.com
23
Section 12 (1) of the Arbitration Act No. 19 of 2000.
24
Section 12 (2) (a) of the Arbitration Act No. 19 of 2000.

8
“The court or arbitral institution, in appointing an arbitrator, shall have due regard to any
qualifications required of the arbitrator by the agreement of the parties and to such considerations
as are likely to secure the appointment of an independent and impartial arbitrator and, in the case
of a sole or third arbitrator, shall take into account as well the advisability of appointing an
arbitrator of a nationality other than any of the nationalities of the parties.”25

In light of the above, even though the techniques used to examine witnesses in the courtroom and
some rules of evidence are applied in arbitration, an arbitrator need not be a lawyer. The rules of
evidence and other related court procedures are applied but informally in the arbitral
proceedings. What is necessary is that the parties choose someone or a panel of arbitrators who
are able to demonstrate impartiality. The arbitrator has to allow the parties to present their case
without any interruptions and objections so that the outcome is respected by both parties.

Furthermore, the parties must choose an arbitrator who has knowledge and expertise on the
matter at hand. The arbitrator therefore, must not necessarily be a lawyer. He or she must be for
instance, in a matter relating to accounts records of a company, it is better to appoint an arbitrator
who is qualified accountant. This ensures that the matter is well analysed and the arbitral award
is correct or speaks to the facts as they had transpired.

In the arbitral proceedings appointed arbitrators have to declare interest if they have some
connection with any of the parties that is likely to be deemed as bias towards one of the parties.
This was recognized in the case of Zambia Telecommunications Co. Ltd v Celtel Zambia
Ltd, where during the arbitral proceedings and specifically before the award was made, the
Chairman of the Arbitral Tribunal was appointed to another Arbitral Tribunal as an arbitrator.

The Chairman was perceived to have been biased because he had agreed to the appointment two
days to the making of the award and hence the court set aside the arbitral award.

HOW THE PROCESS OF ARBITRATION IS CONDUCTED

25
Section 12 (6) of the Arbitration Act No. 19 of 2000.

9
Alternative Dispute Resolution complements litigation and other adjudicatory forms, providing
processes which can either stand in their own right or be used as an adjunct to litigation. 26 There
is no requirement on ADR to follow particular processes and procedures without which, a legal claim
may be dismissed. In this regard, most writings suggest that arbitral processes are determined by a
combination of the provisions of the arbitration agreement and by the procedural laws which
apply in the seat of the arbitration. The Arbitration Act in its preamble gives the court a mare
supervisory role in arbitral processes thereby giving autonomy to the parties to a dispute to
determine the arbitral process.

Generally, the process of arbitration normally begins when the parties to a dispute draw up an
arbitration agreement. An arbitration agreement can arise in two ways. It can arise through a
normal contract where the parties may include an arbitration clause stating that if a dispute
occurs, it will be resolved by arbitration. Equally, an arbitration agreement can be drawn up
through making an agreement after a dispute has ensued between the parties, stating that the
disputes should be resolved by arbitration (sometimes called a “submission agreement”). Where
arbitration arises from an agreement by the parties to a suit in court to resort to arbitration, the
parties are supposed to apply to the Court at any time before the final judgment, for an order of
reference to arbitration.27 The order of reference determines the number of arbitrators according
to the agreement of the parties. 28The order of reference further provides for the arbitral
procedure, stipulate how a party to that arbitration can have recourse to the court and assistance
by the court where required.29

After choosing an arbitrator, the parties submit the matter to the appointed arbitrator(s) and the
arbitrator(s) reviews the evidence in the case and imposes a decision that is legally binding on
both sides and enforceable in the courts.30 During the hearing of the arbitration, procedure is not

26
Kovach, K. [1994], Mediation Principles and Practice. St Paul Minn: West Publishing Co. Pg 5
27
Rule No. 3 of (S.I. No. 26) The Industrial Relations Court (Arbitration and Mediation Procedure) Rules,
2002.
28
Rule No. 4 of (S.I. No. 26) The Industrial Relations Court (Arbitration and Mediation Procedure) Rules,
2002.
29
Rule No. 7 of (S.I. No. 26) The Industrial Relations Court (Arbitration and Mediation Procedure) Rules,
2002.
30
Sheffrin, M. S. [2003], Upper Saddle River. New Jersey: Pearson Prentice Hall. P. 324.

10
as strict as compared to litigation. The parties have to agree on how the process will be
conducted. In the absence of the agreement, the tribunal will consider the appropriate rules for
instance; determine the admissibility, relevance and weight of evidence presented. In the arbitral
process, an award is final except in cases of corruption, fraud, or other circumstances that would
affect an arbitrator’s ability to remain impartial. Where an application is made to the High Court
on the grounds mentioned above, litigation is obviously used for dispute resolution.

THE RECOURSE FOR AN UNSATISFYING ARBITRAL AWARD

As illustrated above, arbitral awards are not subject to appeal. Arbitration leaves no room for an
appeals process in the overwhelming majority of instances. Nevertheless, recourse for not being
pleased with the arbitral award is obtained but only through making an application to the High
Court for setting aside the arbitral award.

The arbitral award may be set aside by the court only if the party making the application
furnishes proof that a party to the arbitration agreement was under some incapacity; or the said
agreement is not valid under the law to which the parties have subjected it or, failing any
indication thereon, under the laws of Zambia; the party making the application was not given
proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise
unable to present his case; the award deals with not contemplated by, or not falling within the
terms of, the submission to arbitration, or contains decisions on matters submitted to arbitration
can be separated from those not so submitted, only that part of the award which contains decision
on matters not submitted to arbitration may be set aside; the composition of the arbitral tribunal
or the arbitral procedure was not in accordance with the agreement of the parties set aside; the
composition of the arbitral tribunal or the arbitral procedure was not in accordance with the
agreement of the parties or, failing such agreement, was not in accordance with this Act or the
law of the Country where the arbitration took place; or the award has not yet become binding on
the parties or has been set aside or suspended by a court of the country in which, or under the law
of which, that award was made.

11
An award may also be set aside if the court finds that: the subject-matter of the dispute is not
capable of settlement by arbitration under the law of Zambia; of the award is in conflict with
public policy; or the making of the award was induced or affected by fraud, corruption or
misrepresentation. In the case of Zambia Telecommunications Co. Ltd v Celtel Zambia
Ltd,31 the Supreme Court upheld the decision by the High Court to set aside the arbitral award on
the basis of public policy, specifically, that the Chairman of the Arbitral Tribunal did not declare
interest when he was appointed as an arbitrator on another arbitral tribunal, a situation likely to
raise the question of partiality.

An application for setting aside may not be made after three months have elapsed from the date
on which the party making that application had received the award. The court, when asked to set
aside an award may, where appropriate and if so requested by the party, suspend the setting aside
proceedings for a period of time determined by it in order to give the arbitral tribunal an
opportunity to resume the arbitral proceedings or to take such other action as in the arbitral
tribunal’s opinion will eliminate the grounds for setting aside.32

CONCLUSION

In summary, the paper has discussed that various ADR processes can be used in resolving
employment disputes. However, the paper focused on arbitration as an ADR process used to
resolve employment disputes. Arbitration is the determination of a dispute by one or more
independent third parties (the arbitrators) who pass a judgment known as an arbitral award and it
is provided for under the Arbitration Act. Further, the essay discussed that the rationale for use of
ADR in resolving employment disputes is the fact that the relationship that exists between the
employer and the employee has to continue after a disputes has been resolved hence ADR
provides the best methods to guarantee a continued relationship. The paper further discussed the
qualities of an arbitrator being that the parties to a dispute determine what qualities the arbitrator
must have, however; generally, the law prohibits prevention of any person to become an
arbitrator on the basis of their nationality, gender, colour, or creed. Furthermore, the paper
discusses how the process of arbitration is conducted. The parties make an arbitration agreement

31
SCZ/34/2008 [Unreported]
32
Section 17 of the Arbitration Act No. 19 of 2000.

12
in which they agree on how appoint the arbitrators and the procedure to be adopted. When the
arbitrators take charge, the conduct the hearing until an award is tendered and a party may make
an application to the High in case of dissatisfaction. In addition, the paper discussed that arbitral
awards are not subject to appeal. Nevertheless, recourse for not being pleased with the arbitral
award is obtained but only through making an application to the High Court for setting aside the
arbitral award.

BIBLIOGRAPHY

Legislation

Rule No. 3 of (S.I. No. 26) The Industrial Relations Court (Arbitration and Mediation Procedure) Rules,
2002.
The Arbitration act of Zambia No. 19 of 2000.

Books

13
A. Marriot. [2002], Mandatory ADR and Access to Justice. Westbury: Foundation Press
Chanda, H.N. (2008), Module LL 27: Alternative Dispute Resolution. Lusaka ZAOU
Garner, B.A. [Ed.]. [2004], Black’s Law Dictionary [8th Ed.], St. Paul: West Publishing Co.
Kovach, k. [1994], Mediation Principles and Practice. St Paul Minn: West Publishing Co.
Martin, A.E. and Law, J. (Eds.) (2009), Oxford Dictionary of Law (7th Ed.) Oxford: O U P.
Sheffrin, M. S. [2003], Upper Saddle River. New Jersey: Pearson Prentice Hall.
Steven M. Sheffrin (2003). Economics: Principles in action. New Jersey: Pearson Prentice Hall.

Cases
Zambia Telecommunications Co. Ltd v Celtel Zambia Ltd, SCZ/34/2008 [Unreported].

Other References

Law Reform Commission (2008) Consultation Paper on Alternative Dispute Resolution

https://www.gov.uk/solve-workplace-dispute/mediation-conciliation-and-arbitration
www.nolo.com
https://en.wikipedia.org/w/index.php?title=Arbitration&oldid=681534187
http://www.albrightstoddard.com

14