Settlement of Employer and Employee Disputes and Competent Authorities for Resolution
The employer-employee relationship is one of the most common legal relationships in modern societies. The specific characteristics of this relationship led to the enactment of specialized legislation known as labor law, which governs the rights and obligations of both parties.
Disputes between employers and employees are among the most significant issues that can arise in this relationship.
Procedures Before Labor Dispute Settlement Boards
Persons Subject to Labor Law
Before examining the competent authorities responsible for resolving disputes between employers and employees, it is essential to determine which individuals fall within the scope of labor law and are entitled to seek resolution through relevant labor dispute authorities. According to Article 5 of the 1990 Labor Law, all employers, employees, their representatives, workplaces, and trainees are subject to its provisions. Under this legislation, an employee is defined as a person who performs work under the direction of an employer in exchange for remuneration, including wages, profit shares, or other benefits. An employer is a natural or legal person for whom an employee performs work in exchange for compensation.
Methods of Resolving Employer and Employee Disputes Under Labor Law
Chapter Nine of the Labor Law addresses the procedures for resolving disputes between employers and employees. This chapter identifies the competent authorities responsible for dispute resolution and outlines procedural requirements. Pursuant to Article 157 of the Labor Law, disputes arising from the law or contractual obligations between employers and employees are resolved in two stages.
In the first stage, disputes must be resolved through direct reconciliation between the parties within the Islamic Labor Council. In workplaces where such councils do not exist, disputes are addressed through labor unions or authorized representatives of employees and employers.
If reconciliation is unsuccessful, disputes must be referred to the Diagnosis Board and subsequently to the Dispute Resolution Board.
The Diagnosis Board consists of a representative from the Ministry of Labor and Social Affairs, a representative of employees selected by the Provincial Coordination Center of Islamic Labor Councils, and a representative of industrial managers selected by the Employers’ Trade Association. The Provincial Dispute Resolution Board consists of three employee representatives, three employer representatives selected by industrial managers, and three government representatives.
Procedures for Dispute Resolution by Labor Authorities
Several important considerations govern the resolution of disputes between employers and employees:
- Under applicable regulations, disputes are examined in two stages, including initial review and appellate review.
- The initiation of dispute resolution requires the submission of a written claim by the interested party or their legal representative to the competent labor authority. The claim must be written in Persian and submitted to the Labor and Social Affairs Office located at the employee’s last workplace.
- The claim and all supporting documents must be submitted in the number of documents corresponding to the number of defendants.
- Sessions of the Diagnosis Board are held in the presence of its members, and both parties must be invited to attend at least one hearing session. Failure of either party or their representatives to attend does not prevent the board from conducting proceedings or issuing a decision.
- If either party objects to the decision issued by the Diagnosis Board, the objection must be submitted in writing to the Dispute Resolution Board within fifteen days from the date of notification.
- The Dispute Resolution Board serves as the competent authority for reviewing objections to decisions issued by the Diagnosis Board. Decisions issued by the Dispute Resolution Board are final and enforceable.
- The Dispute Resolution Board must formally notify the parties in writing regarding hearing sessions. Failure of the parties or their representatives to attend does not prevent the board from proceeding or issuing a decision. If the board considers the parties’ attendance necessary, it may reschedule the hearing only once.
Final decisions issued by the Dispute Resolution Boards remain subject to certain legal objections under applicable laws.
Frequently Asked Questions About Employer and Employee Dispute Resolution
All employees, employers, their representatives, workplaces, and trainees fall within the scope of labor law. An employee is a person who works under the direction of an employer in exchange for remuneration. In contrast, an employer is a natural or legal person for whom an employee works.
Disputes are resolved in two stages. The first stage involves direct reconciliation between the parties through labor councils or labor unions. If reconciliation fails, the dispute is referred to the Diagnosis Board and subsequently to the Dispute Resolution Board.
The Diagnosis Board consists of representatives from the Ministry of Labor, employees, and industrial managers. The Provincial Dispute Resolution Board consists of three employee representatives, three employer representatives, and three government representatives.
The claim must be submitted in writing and in Persian to the Labor and Social Affairs Office located at the employee’s last workplace. The claim and supporting documents must be submitted in copies corresponding to the number of defendants.
Failure of the parties or their representatives to attend does not prevent the competent authority from conducting proceedings or issuing a decision. However, the authority may reschedule the session once if attendance is deemed necessary.
Parties may submit written objections to the Dispute Resolution Board within fifteen days from the date of notification. Decisions issued by the Dispute Resolution Board are final and enforceable.
Yes, final decisions of the Dispute Resolution Boards may be subject to objection under applicable legal provisions. Who is subject to labor law?
How are disputes between employers and employees resolved?
How are the Diagnosis Board and Dispute Resolution Board formed?
How is a claim submitted for dispute resolution?
What happens if the parties fail to attend the hearing session?
How can parties object to decisions of the Diagnosis Board?
Are decisions of the Dispute Resolution Boards subject to objection?
If I quit before filing a complaint, can I still bring a claim against my employer?
In many situations, yes. Leaving your job does not automatically prevent you from pursuing legal claims related to your employment. The available remedies and filing deadlines depend on the applicable labor laws and the facts of your case, so it is important to seek legal guidance without unnecessary delay.
Can an employer discipline someone just for filing an internal complaint?
Many legal systems provide protections against retaliation for employees who raise workplace concerns in good faith. Whether a particular action is unlawful depends on the applicable law and the circumstances surrounding the employer’s decision. A careful review of the facts is essential before reaching any legal conclusion.
If both sides agree to mediation, does that stop either of them from going to court later?
Not necessarily. The answer depends on the applicable law, the mediation process, and whether a binding settlement agreement is reached. If no final resolution is achieved, additional legal options may still be available.
What if there are no witnesses to what happened at work?
A case is not automatically unsuccessful simply because there were no witnesses. Emails, text messages, company records, performance reviews, and other documents may also be relevant evidence. Every dispute should be assessed based on all available information.
Can an employer and employee settle a dispute privately after a lawsuit has already started?
Yes. Many employment disputes are resolved through negotiated settlements even after legal proceedings have begun. Whether settlement is appropriate depends on the facts, the legal issues involved, and the parties’ willingness to reach an agreement.
If my employment contract says disputes have to go to arbitration, do I still have any other options?
That depends on the wording of the agreement and the laws governing employment disputes in the relevant jurisdiction. Some arbitration clauses are enforceable, while others may be limited by mandatory legal protections. The agreement should be reviewed before deciding how to proceed.
Can a dispute over unpaid bonuses be treated differently from unpaid wages?
Yes. Whether a bonus is legally enforceable often depends on the employment contract, company policies, and the conditions attached to the payment. The legal analysis may differ from a claim involving unpaid wages.
if several employees have the same complaint, is it better to file together?
In some situations, employees may be able to pursue claims collectively, while in others separate claims are more appropriate. The best approach depends on the legal issues involved and the procedures available in the relevant jurisdiction.
Can messages on WhatsApp be used as evidence in a labor dispute?
They may be, depending on the applicable rules of evidence and whether the messages can be properly authenticated. Digital communications often play an important role in employment disputes, but their legal weight varies from case to case.
Is it possible to resolve a labor dispute without damaging the working relationship?
In many cases, yes. Early negotiation, mediation, or other forms of alternative dispute resolution can help the parties address concerns while preserving a professional working relationship. Whether that is achievable depends on the nature of the dispute and the willingness of both sides to participate in good faith.