Industries Disputes Settlement Board hearing the hotels contract dispute, The Royal Gazette has learned.

Mr. Mello and Canon Francis will join Government arbitrator Prof. Ronald Houghton on the board, which is dues to start hearing the dispute between the Hotel Employers of Bermuda and the Bermuda Industrial Union next Wednesday.

Home Affairs Minister the Hon. Irving Pearman confirmed yesterday that the three had been asked to sit on the board.

Mr. Mello is an experienced arbitrator who chairs the Price Control Commission and has also sat on number of arbitration boards in the past.

Canon Francis, the chairman of the Human Rights Commission, sat with Prof.

Houghton on the hotels board of inquiry in 1988.

Next week's hearings will mark the second time that the Essential Industries Disputes Settlement Board -- created last year -- has been used.

Prof. Houghton was the sole member of a board which heard the dispute between the BIU and the Grotto Bay Hotel over the hotel's decision to abandon the mandatory 15 percent gratuity system and to reintroduce free tipping.

The hotel refused to participate in the hearing and has ignored Prof.

Houghton's ruling that it return to mandatory gratuities and revert to pay scales laid out in the HEB contract.

Next week's hearings, which are expected to be lengthy, are supposed to bring the long-running contract dispute to a close.

The BIU-HEB contract expired last February when the hotels terminated it and a settlement proposed by Government arbitrator Mr. William Hobgood was rejected by the union, sparking the essential industry legislation, which allows Government to refer the two sides to arbitration for binding settlement.

Former Home Affairs Minister the Hon. Sir John Sharpe referred the two sides to the board after mediated talks between the two sides broke down earlier this year.

One of the first questions the board will have to decide when it meets is whether the hearings will be held in public or in private.