Non-judicial remedies: Company-based grievance mechanisms and international arbitration
The possibility for those negatively affected by business activities of using effective remedies through which they can ask for recognition of their grievance and claim compensation, is the litmus test for all business and human rights frameworks. 1 Access to an effective remedy is also a human right itself, enshrined in major international human rights treaties. 2 From a legal perspective, litigation through the courts is the most formal and legally effective avenue, as its outcomes are binding on all parties and, if necessary, enforceable. Court rulings also contribute to providing legal clarity on how to apply human rights norms in the business context and how this corporate responsibility translates into tort law. As the chapter on judicial remedies illustrates, however, formal litigation
fore, victims’ representatives, researchers, but also companies have increasingly been looking into the possibilities of non-judicial remedies in addition or as an alternative to judicial remedies. ‘Non-judicial remedies’ is, though, a very broad term in itself, encompassing models that are very different in view of their organization and possible outcomes. They can take, for example, the form of state-based or international arbitration, conciliation or mediation (e.g. the OECD Guidelines for Multinational Enterprises with the system of National Contact Points or the World Bank Inspection Panel), sector/industry based initiatives (e.g. the Fair Wear Foundation), or company-based grievance mechanisms. 4 What these mechanisms have in common is that they require the willingness of all actors involved, notably also the business actor, to engage in – to varying degrees – a formalized process. Unlike for court litigation, there exist no formal legal procedures for non-judicial remedies in Europe and the outcome of such procedures can be binding on both parties (either an agreement reached through mediation or a binding decision by an arbitrator), but does not necessarily have to be.