2.Main Content
Acas arbitration
This page contains information on the Advisory, Conciliation and Arbitration Service (Acas) arbitration scheme, including:
What it does
Advantages and disadvantages
Which complaints are eligible and which are not?
Cost
Timescale
Procedure
Outcomes
What it does
The Advisory, Conciliation and Arbitration Service (Acas) is an independent body with a range of statutory duties and powers to help resolve employment disputes involving individuals and groups of workers. (In Northern Ireland, the Labour Relations Agency (LRA) performs essentially the same functions as Acas does in England, Wales and Scotland.) It offers, among other services:
- conciliation to resolve claims that have been registered with the Employment Tribunal or where there is a right to tribunal
- mediation in some cases
- arbitration to resolve unfair dismissal claims and disputes over requests for flexible working that could go to an Employment Tribunal
- arbitration and conciliation in collective employment disputes
This page contains information about the Acas arbitration scheme for employment disputes. The arbitration scheme covers England, Wales and Scotland. It is important to note that there are different procedures for agreeing to use the scheme in England and Wales on the one hand, and Scotland on the other. Acas has produced separate guidance for use in England and Wales, and in Scotland.
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Advantages
- It is free
- It is independent
- It is impartial and does not take sides
- It is informal
- It is private
- It is voluntary and requires the consent of both parties
- It will result in a binding, legally enforceable award
Disadvantages
- It is sometimes difficult to get both sides to agree to use the scheme
- There are limited grounds to appeal against an arbitration decision
- Complainants cannot take their claim to the tribunal after using arbitration
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Which complaints are eligible and which are not?
Only claims of unfair dismissal and disputes over flexible working requests are eligible.
The arbitration scheme is not suitable for claims to do with rights under EC law, including Sex Discrimination and Working Time.
Note on discrimination: Complainants with an unfair dismissal claim should get independent advice from a specialist adviser before considering arbitration for unfair dismissals or flexible working. It is not the role of the arbitrator to identify other possible claims and point them out to the parties. Cases involving discrimination, for example, might have public policy implications, and employees also need to know that higher compensation is available in discrimination cases. For claims of unfair dismissal or flexible working that might also include a claim of discrimination, complainants might obtain advice and assistance from the relevant rights commission. If after agreeing to arbitration a complainant becomes aware that other issues are involved, such as discrimination, these can be raised as separate claims as long as they are brought within the three-month time limit. Once the unfair dismissal claim goes to the arbitrator, however, other claims cannot be added on to be heard by the arbitrator, as they can by a tribunal.
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Cost
Acas arbitration is free to employers and employees.
Parties are responsible for their travel expenses, and no loss of earnings is paid. An arbitrator can award a sum to cover the applicant's costs in attending the hearing if he or she finds in favour of the applicant.
Legal Representation is not available for employment claims under legal aid in England and Wales, but Legal Help may be available to eligible clients. This means that legal aid may pay for legal advice, but not for an adviser to represent their client at an employment tribunal, or during the arbitration process. In Scotland, advice and assistance may be available for help in preparing a claim.
Acas will provide interpreters, signers or communicators as necessary and meet the costs.
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Timescale
The estimated time from the receipt of a qualifying agreement to use the Arbitration Scheme is usually around four to six weeks to set up a hearing, and a further two weeks for the award to be sent to the parties.
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Procedure
When an application is submitted to the tribunal, Acas will receive a copy and offer to conciliate in the usual way (see Acas conciliation). If a conciliated settlement is not reached, or if one or both of the parties choose not to conciliate, the case can 1) be withdrawn, 2) proceed to tribunal hearing, or 3) go to arbitration.
An agreement to arbitrate can only be made after the parties have either been advised by an Acas conciliator or have reached a Compromise Agreement following advice to the employee from a qualified independent adviser.
Once they have entered the agreement to arbitrate, the parties have agreed that arbitration will dispose of their legal claim - in other words, arbitration is final and binding on both parties. The applicant can withdraw from arbitration at any time, but cannot reopen the original claim to the tribunal. The employer cannot withdraw once agreement to arbitration has been accepted by Acas.
Parties submit their written argument and supporting documents to Acas, which sends these to the other party and to the arbitrator. Hearings are held in private, are meant to be informal and normally to last no more than half a day. They are held at a neutral venue, such as a hotel or Acas office. Each party will be asked to give an opening statement, and then each will present their case. Witnesses can be called, and parties can ask questions of the other side. At the end of the hearing, the arbitrator will ask for details of the complainant's earnings, unemployment benefits, etc in order to calculate compensation if it is awarded.
The arbitrator's award is issued within three weeks of the hearing. It is in writing, giving the reasons for the decision.
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Outcomes
The remedies that an arbitrator can award are the same as in an Employment Tribunal.
In unfair dismissal claims, arbitrators are to consider, where appropriate, the option of reinstatement first, then re-engagement and/or compensation. Acas defines an order for reinstatement as "an order that the employer should treat the employee in all respects as if he or she had not been dismissed."
In disputes over flexible working requests, arbitrators can order the employer to reconsider the request and/or award compensation. In both instances, the ceiling on compensation is the same as in tribunals.
One advantage of arbitration over tribunals is that decision-making is based on the "industrial relations standard", rather than the legal standard. This means that arbitrators can take into account industry standards, good practice, consistency and reasonableness. They will decide the case purely on its merits, rather than relying on clever legal points, case law or legal precedent.
There is very limited appeal against an arbitrator's decision. The only grounds allowed for appeal are where there is "serious irregularity" in the way the arbitration was conducted or where there is a question of whether the arbitration agreement was valid or the dispute was within the scope of the scheme.
Enforcement depends on the nature of the remedy awarded. Compensation awards can be enforced through the county court. If an arbitrator's award for reinstatement/re-engagement is not complied with, the applicant can apply to the Employment Tribunal, which can issue a penalty compensation award.
For more details of the scheme, see the following Acas publications, available to order from Acas or from an Acas office:
- "The Acas arbitration scheme for the resolution of unfair dismissal disputes: A guide to the scheme"
- "The Acas arbitration scheme for the resolution of flexible working disputes: A guide to the scheme"
- "An introduction to the Acas arbitration scheme"
- "Heading for a tribunal? The informal, confidential choice - the Acas Arbitration Scheme"
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Revised November 2006
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