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The Effects of Compulsory Interest Arbitration on Disputes, Wages and Service Quality: Evidence From a Unique Natural Experiment in Canada

November 20, 201812:00 pm1:30 pm

Interest arbitration is a tool sometimes used in union negotiations for public workers who don’t have the right to strike. Issues that can’t be resolved in the collective bargaining process are sent to an impartial arbitrator. The role of interest arbitration in public sector collective bargaining has recently been at the forefront of public administration concerns, largely due to fiscal challenges that emerged following the 2008 financial crisis. Many local/municipal and state/provincial governments across North America have been vocal in criticizing interest arbitration, arguing that arbitrators’ awards are either a) out of line with what is bargained elsewhere and/or b) higher than would have been agreed to if bargained under a right-to-strike system. It has been difficult for past research to provide compelling evidence that could shed light on these issues.

Riddell’s research seeks to answer this question by exploiting variation in dispute resolution procedures from the ambulance services sector in Ontario. This sector is unique from a wage and employment setting standpoint for Canada’s public sector due to both institutional and sociopolitical historical context. The combination of these institutional arrangements and policy changes creates a natural experiment where there are before-after and then back-to-before changes in policy for a treatment group with a control group from the same occupation and jurisdiction throughout the sample period.