What is a Trade Dispute?

Mary McMahon
Mary McMahon

The term “trade dispute” can refer to two different types of conflicts. The first is an argument between employers and workers over terms of employment, working conditions, and related matters. In a second sense, it refers to an argument between nations about the terms of trade agreements. In both cases, it may be necessary to bring in an outside negotiator to assist people with the process of reaching a resolution.

Woman holding a book
Woman holding a book

In a workplace trade dispute, employees are usually not satisfied with certain employment conditions. They may want more wages, better benefits, different working hours, or adjustments to conditions in the workplace, like better access to safety equipment. Workers approach the employer to discuss the matter, and the employer can decide to grant the requests, or negotiate. Often, a union participates in a trade dispute, acting on behalf of workers in discussions with the employer. The trade union carries more clout than individual workers or groups of employees.

Sometimes, trade disputes result in a strike, where employees refuse to work until their demands are met. More commonly, employers and workers are able to reach an agreement. Both sides may need to make some concessions to make a deal, and in some cases, people may agree to suspend negotiations and revisit the topic at a later date. When a trade dispute involves industries vital to the national economy, sometimes the government weighs in as well to prevent interruptions to economic activities.

International trade disputes can occur when nations do not like the terms of a trade agreement or disagree with policy changes a trading partner has made. People might want more favorable taxes and tariffs or may demand a suspension of quotas. Representatives of each government meet to discuss the trade dispute and work out some proposals for resolving it. Some can act directly to make decisions, while others need to take proposals back to other members of the government to see if they agree to new terms and conditions.

These disputes can become acrimonious enough that the parties need a mediator. International trade organizations can supply representatives to discuss a trade dispute with the parties and come up with suggestions for resolving it. The members of the dispute may also take their case to court, suing if they feel the terms of international law or existing trade agreements are in question with the dispute. For example, if two nations are members of a trade partnership expressly prohibiting tariffs on goods moved between member nations, and a country starts charging a tariff, the other party can sue for damages and to put a stop to the charge.

Mary McMahon
Mary McMahon

Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a wiseGEEK researcher and writer. Mary has a liberal arts degree from Goddard College and spends her free time reading, cooking, and exploring the great outdoors.

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Discussion Comments


@feruze-- No, that's not a trade dispute. It's a personal dispute and they can take legal action personally if they want.

But a trade dispute can only be between the employees and the employer. And it has to be a dispute about work. Employees can't file for a trade dispute because they don't like the employer's personal life preferences or political presences. They have to have some kind of grievance about their work conditions. There must be a breach of a mutual agreement.


If there is a dispute between employees, or between two management personnel (employers), is that considered a trade dispute?

For example, if there is a contract between two employers or partners on the the duties and rights of their positions, but one misuses his rights, is it a trade dispute?


The World Trade Organization helps settle many trade disputes between countries. I read about a trade dispute between Japan and the U.S. just the other day.

I didn't know that Japan has more trade disputes with the U.S. than with any other country. And most of the trade disputes between Japan and U.S. are about the automobile industry.

I don't know about the cases that other countries file first, but I think that the U.S. wins most of the disputes it files to the World Trade Organization.

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