Usage of Alternative Dispute Resolution Methods for Settlement of Labour Disputes of Manufacturing Industry in Sri Lanka

Abstract

Alternative Dispute Resolution (ADR) methods such as Arbitration, Conciliation, Collective Agreements and Industrial Courts are utilized for settlement of labour disputes in manufacturing organizations in Sri Lanka instead of litigation where applicable. Thus, this study aims to identify ‘to what extent manufacturing industry in Sri Lanka practices ADR methods’. The aforesaid research problem was approached through a multiple case study including three manufacturing organizations in Sri Lanka. Semi structured interviews were utilized for data collection considering both employer and employee perspectives. Findings of the case study survey revealed that usage of ADR methods was lesser comparing to the usage of litigation even though the arduous litigation process provides considerable of drawbacks. As a result of that organizations do not receive benefits of using ADR and the native drawbacks of the litigation process are there. Further findings revealed that ineffectiveness incorporated in to current ADR system was the major reason for the less usage. In this research improvements are recommended for development of ADR to achieve strong position with effective settlements which leads to increase the usage of ADR. When the usage is increasing, simultaneously organization will be benefited in two ways with reduced litigation drawbacks and benefits of ADR. This study will provide information for authorized persons about current ADR practice and areas where further improvements are required. The study emphasizes business managers and employees the significance of using ADR instead of litigation practices where applicable.

Keywords: Arbitration; Conciliation; Collective agreements; Industrial courts; Litigation

JEL Classification: L6