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September 5, 2008

Future Shock

The Process and the Grievance

by Kevin Goldstein

Recent chats and my e-mail inbox have shown that our readers find the current draft soap opera a compelling story. Opinions are wide ranging, but beyond the issues themselves, numerous readers have asked about how the process actually works. Beyond the decision and who it may favor, how will a resolution come about? Here's a quick primer on what the grievance contains, and the steps to be taken on the way to a final ruling.

The Process

Next Wednesday, arbitrator Shyam Das will hear Grievance No. 2008-11, submitted by the Major League Baseball Player's Association and subtitled "August 15 deadline." While this is the case that involves Pedro Alvarez, Eric Hosmer, Scott Boras, the Pittsburgh Pirates, and the Kansas City Royals, none of the parties are specifically mentioned by name. As is common practice when a labor union and a business are involved, both sides agree to have their disputes handled by an independent arbitrator (or arbitration panel) whose decisions are legally binding. The advantages of this process over the regular legal system are numerous.

• Speed: Grievances can be filed and acted upon quickly. This grievance will be heard just two weeks after its filing, and a ruling will come no more than 30 days (and likely much sooner) after the hearing. In the standard court system, such a case could be drawn out for months or even years.
• Privacy: A grievance hearing is held in a private room. There are no reporters, there is no court stenographer, and there is no public record. This provides much desired confidentiality for all parties.
• Judge Selection: Any attorney will tell you that the judge in a trial can often prove to be the difference in winning or losing a case. In the arbitration process, both parties agree to the arbitrator (or "neutral"). In this case, it's Das, a former attorney and now full-time arbitrator in multiple industries who has served in this role for baseball and the union since the late 1990s, and has settled over 100 disputes between the two sides. The concept of a neutral in the arbitration process is an important one, and expertise is an important factor as well. "One of the principals of this process is that the arbitrator is familiar with the industry," said Frank Zotto, a Vice President with the American Arbitration Association (AAA), who administers the process for many organizations, including Major League Baseball. "Both sides want a knowledgeable party, and by having one it saves time, and therefore money."

The hearing will take place in a room with both parties and the arbitrator present. It is not a court room, and AAA often supplies a venue in their offices for these hearings. It is not exactly like a standard legal procedure, but there are many similarities. "In many ways, the process is a creature of the agreement between the two parties," explained Zotto, "part of any agreement for arbitration between the two parties includes the rules for those arbitrations." At the same time, on a basic level, it is like a standard trial. "It's similar in that it is an adversarial process," continued Zotto. "Each party is permitted to be represented by counsel, but they don't have to be, and each side presents their case and can enter exhibits or evidence to the proceeding." Once the proceedings have ended, it's up to the arbitrator to rule, but at this point, the process diverges from that of a standard trial. As part of his determination, the arbitrator can re-open the hearing at a later date in order to hear additional evidence, and at any point, he can conduct separate meetings or conversations with either party.

Following the hearing and any discovery process by the arbitrator, a binding ruling and relief (or "award") are provided.