Do Litigants Settle When They Face Non-Reformist Judges? Evidence From French Labor Courts

Are more cases settled when judges are elected among the most belligerent trade unions? In the specific case of French employment courts, the answer is broadly negative. This article provides evidence of the minor role that judges have on alternative dispute resolution in and out of court. Previous literature has suggested a potential bias in the functioning of these labor courts. Judges are appointed, with a national election, among trade unions' members. Some syndicates use aggressive tactics in the pursuit of syndical policy objectives, and this belligerency might be conveyed in judicial decision-making. To address the endogeneity issue related to the measurement of this adversarial attitude, the paper relies on historical evidence to construct an instrumental variable and assess why settlements are so low. Indeed, much of the unwillingness of trade unions to achieve peaceful social dialogue is proven to be connected with the crisis triggered by a minuscule parasite, named phyllox ́era. Therefore, the final explanation might be that polarized courts convey an image of belligerency and support a full but long assessment of legal rights, encouraging the parties to wait for the judgment instead of anticipating its effects with conciliation