Originally from Dispute Resolution Journal

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Background of Interest Arbitration

The submission of contract content issues to an impartial third party has a longer history in labor relations in this country than does grievance arbitration involving the interpretation and application of an existing agreement. Probably the earliest known interest arbitration case occurred in 1786 between the seamen and their employers in New York City. "Its purpose was to establish the wages of the seamen."

In the late 188O's, some settlements in steel, mining and on the railroads were determined by our present meaning of interest arbitration. Although this approach to the settlement of the terms of a collective agreement has not met with general acceptance in private employment, a few unions and industries have successfully used this approach for more than six decades. Both unions and employers, for the most part have preferred the economic means of the strike and the boycott to settle their disputes.