Question

The management at Gomars Inc., a firm manufacturing toys, is involved in a dispute with the union members representing its employees. The union members want a pay hike, but the management is not ready to approve the hike. Failing to arrive at a compromise, the disputing parties involve a third party to resolve the issue and offer a solution that is legally binding. The third party in the given scenario best represents a(n):

Select one:
a. conciliator.
b. arbitrator.
c. mediator.
d. strikebreaker.
e. scab.

Answer 1

The third party in the described scenario who offers a legally binding solution to the dispute over a pay hike between Gomars Inc. and its employees' union is best represented as an arbitrator. An arbitrator has the authority to make a decision that both parties must follow, unlike mediators or conciliators.

Step-by-step explanation:

In the scenario described, where Gomars Inc. is facing a dispute with its employees' union over a pay hike and a third party is involved to resolve the issue with a legally binding solution, the third party best represents an arbitrator. An arbitrator is a neutral third party who listens to both sides in a dispute and makes a decision that is binding for all involved parties.

In cases where an informal approach hasn't worked and no internal mechanism is available, an arbitrator can offer a fair resolution, such as in historical events like the 1902 Anthracite Coal Strike where miners eventually received a 10 percent raise through arbitration. Employers and unions may resort to arbitration when negotiations reach a standstill to ensure that the dispute does not escalate further and disrupt work processes.