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When you just can't come to an agreement, court isn't the only answer. Arbitration is an out-of-court means of dispute resolution. When parties have a disagreement, the 'arbitrator' or 'arbiter' is a neutral third-party that reviews the case to determine what action should be taken, and will determine the terms under which the dispute will be settled. The decision of the arbitrator is final, and may be legally binding or non-binding.

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Arbitration News

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After rejecting a salary increase offer on the part of the city of Newark, the Newark Police Department entered into binding arbitration over the contract disagreement.  The arbitrator assigned to the negotiation has ordered the police department to accept the city’s offer.

 

The city’s offer detailed no raise in 2014, with small incremental raises of 1% in 2015 and 1.5% in 2016.  These raises matched the raises offered to non-uniformed city employees, and were rejected by the police union in July.  The police had asked for the same raises granted the fire department: No raise in 2014, but with increases of 1.5% in both 2015 and 2016.

 

The police union indicated that it would accept the arbitrator’s decision, pending a final review of the total contract.  However, the union likely has no recourse, as the arbitration’s decision is binding.  They could potentially ask a court to overturn the ruling, but this would be very unlikely unless they could point to a clear violation of the law, which does not appear to be present in this case.

 

While the raises are in line with other city employees, it’s unclear why the fire department received such a substantially larger package, and this issue was not addressed by the city or the arbitrator as it fell outside the parameters of the police contract negotiations.

 

Newark has been struggling with a fading economy, crumbling infrastructure, and a high crime rate.  The lack of raises in 2014 was designed to help the city shore up its finances.