HR Science Forum
Mandatory and binding arbitration: Effects on employee attitudes and recruiting results
Article first published online: 29 MAR 2011
© 2011 Wiley Periodicals, Inc.
Human Resource Management
Volume 50, Issue 2, pages 175–200, March/April 2011
How to Cite
Bernardin, H. J., Richey, B. E. and Castro, S. L. (2011), Mandatory and binding arbitration: Effects on employee attitudes and recruiting results. Hum. Resour. Manage., 50: 175–200. doi: 10.1002/hrm.20417
- Issue published online: 29 MAR 2011
- Article first published online: 29 MAR 2011
- binding arbitration;
- alternative dispute resolution;
- procedural fairness perception;
- organizational trust;
- turnover intentions
This paper reports the results of two studies undertaken in the same Fortune 500 company as it adopted an Alternative Dispute Resolution (ADR) program. Study 1 assessed employees' perceptions of fairness, trust, and turnover intentions regarding ADR options. Compared with other options for ADR, a program consisting of mandatory mediation followed by mandatory and binding arbitration (MMBA) resulted in significantly lower levels of procedural fairness perception, organizational trust, and intentions to stay with the firm. Contrary to previous research, no significant effects were found related to respondents' demographic characteristics and their reactions to ADR program characteristics. In Study 2, job-applicant flow data were evaluated and compared by corporate region to determine the effects of an MMBA program installed in one region. Results revealed no significant effects related to the MMBA program on the organization's ability to recruit and ultimately fill key positions. As in Study 1, no significant effects were found in Study 2 for the demographic characteristics of applicant race/ethnicity, gender, or age on applicant recruitment decisions. Although Study 2 results indicated job candidates are unaffected by the existence of an MMBA program, given Study 1's results, practitioners should be cautious about implementing such a program for current employees. © 2011 Wiley Periodicals, Inc.