Inter-American Development Bank abolishes its Conciliation Committee

By 1st May 2013 January 9th, 2017 IAL, International Administrative Law, News

Last month, the Inter-American Development Bank (‘IADB’) brought into force a revised version of its Staff Rule PE-323, governing conflict resolution between staff members and the Bank.  The amended provisions have the effect of abolishing the Conciliation Committee, the Bank’s fact-finding tribunal of first instance, in favour of a system of compulsory mediation, after which staff members may proceed directly to the Administrative Tribunal of the IADB.

The reform is controversial for many reasons, not least because it replaces an inquisitorial fact-finding tribunal with a mediator charged with seeking consensus.  Moreover, in the new system the tribunal of first instance becomes the Administrative Tribunal, from which there is no avenue of appeal, contrary to the norms of international administrative law and, indeed, public international law generally.

Loss of an avenue of appeal
The principal consequence of the reform is that the Conciliation Committee has been dissolved, meaning that the fact-finding tribunal has been removed from the conflict resolution system schematic.

The right of appeal is recognised as an ‘essential safeguard in law’ in international organisations by ILOAT, reflected in the case of Bangasser and others v ILO, (1994) judgment 1330, and reiterated in several other ILOAT judgments since.  A ‘right to appeal’, albeit in criminal cases, is also declared in article 8.2(h), the Pact of San Jose, and echoed in article 2 of Protocol 7 of the European Convention of Human Rights.  The fact that it is enshrined in international conventions is indicative of its importance within any justice system, domestic or international.  As an essential legal safeguard, it could certainly be argued that it is a fundamental and essential term of employment for international civil servants.  It would follow that any move to reform or revoke the right would be a regulatory decision which could not be implemented except with the consent of the staff members, meaning that a failure to do so would render the revised Staff Rule PE-323 unlawful.

Aside from the unlawfulness of the revocation of the right of appeal, the Conciliation Committee’s erstwhile mission has been conferred on a body that is accustomed to dealing with appeals.  Many Administrative Tribunals will not interfere with findings of fact unless they are manifestly erroneous or unreasonable, although the IADB Administrative Tribunal does indeed have the power to hear an appeal de novo.  Staff members would hitherto have had two opportunities to have their cases heard.  With the introduction of the new provisions, the Administrative Tribunal has become a ‘one-stop shop’, thus depriving staff members of the possibility of having their cases reopened and re-examined.  Its new mission as a tribunal of first instance will require a considerable adjustment of its present mandate, statute and its philosophy when approaching cases in order to reflect the evolution of its function.

Pitfalls of mediation
Besides the loss of an avenue of appeal, compulsory mediation may transpire to be counter-productive when attempting to resolve staff disputes because of its mandatory nature.  While mediation can be an exceedingly useful tool if both parties are willing to negotiate, its success depends on the parties coming together voluntarily.  The imposition of compulsory mediation is not conducive to amicable settlements and is wholly inappropriate for cases where the issue turns on a purely legal argument, such as the interpretation of a contract term that will apply across the organisation.  It is also inappropriate where the parties are quite evidently unable to reach consensus on any of the issues in the case, particularly where there have already been attempts to negotiate or settle the claim directly between the staff member and the Bank prior to initiating litigation.  In this scenario, mediation will result in the incurring of further costs and unnecessary delay to both parties.  Although a vetting procedure appears to be in place at the IADB, any Mediation Secretary will need to be extremely vigilant in ensuring that the right cases progress to mediation.

Even if there is scope for consensus, the impartiality of the mediator is fundamental.  A mediator’s remit is often misunderstood by staff members.  A common, but erroneous, perception is that mediators actively participate in the formulation of the terms of a settlement.  The opposite is in fact true; mediators cannot suggest settlement terms to the parties and are under no duty to ensure that settlements are fair or just for either party.  The mediator will be under no duty to assist them, as it would conflict with the mediator’s duty of impartiality.  Quite often, staff members are not entitled to legal representation at mediation sessions, and the IADB is no exception.  As the Bank will benefit from unlimited legal advice from its own in-house department, the resulting inequality of arms leaves a staff member exposed to not receiving the fairest possible settlement through the mediation process, uninformed as to his or her rights and afraid to assert them.  Without a lawyer present, it can be highly intimidating for a staff member to come face to face with his or her manager or colleague, especially where a case revolves around harassment.  It can also be disheartening if the person across the table is one who has already refused to grant an administrative remedy to the staff member, such as a Director of Human Resources.

Reforms such as this one have led to the absurd situation whereby a staff member must file a ‘request’ for compulsory conciliation; a contradiction in terms which appears to be lost on the organisations advocating this solution.

A full copy of the revised IADB Staff Rule PE-323 can be found on the IADB website here:

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