Arbitrator

An arbitrator is a person who performs arbitration, a form of alternative dispute resolution in which a neutral third party listens to the arguments of both sides of a dispute and then renders a decision, which is generally final and binding. Unlike judges, who usually have no expertise in the particular topic in dispute, arbitrators are often chosen for their expertise in a particular area. For example, people with a dispute relating to construction would likely choose an arbitrator who is also a general contractor, an architect, or a lawyer specializing in construction issues. People with a health insurance dispute might prefer to use someone familiar with medicine, the insurance industry, or both. By having a neutral who is already an expert on the topic, the parties do not have to spend nearly as much time educating the arbitrator about the technical aspects of the dispute. They also can have more confidence that the decision will be based on a sound technical understanding of the issues, which may not be true if the decision were made by a judge or a jury of laypeople.

Although parties are free to find an arbitrator on their own, they often turn to one of several major organizations that provide arbitration services and lists of arbitrators. One is the American Arbitration Association, which has a list of over 20,000 arbitrators who are experts in a wide variety of fields. Other organizations providing references to arbitrators include the Better Business Bureau and the Federal Mediation and Conciliation Service (limited to labor disputes).

One ethical problem that has arisen in recent years is that some sales contracts specify that disputes will be arbitrated by a person drawn from a board of arbitrators assembled by the industry selling the product. For example, insurance companies maintain their own arbitrators to arbitrate insurance disputes; financial service organizations do the same. Consumers and consumer advocates have charged that such arbitrators are not neutral—they are trained and sometimes paid by the industry and thus tend to take the industry's side in a dispute. Although this problem still arises in some cases, more and more contracts specify that the arbitrator will be provided by a neutral organization.