The success of mediation is well known. In excess of 85% of all cases are settled when the parties come together to talk about their dispute, when each side has the opportunity to be heard and, most importantly, take an active role in crafting a resolution to the pending dispute. What is often noted by judges that assign their cases to mediation is that “mediation gives the parties the ability to control the conclusion of their dispute. Once the dispute goes to court, all decisions are left to the judge or jury and the parties no longer have any control over the outcome.”
But often the mediation process is only considered after the lawsuit has been filed, after discovery has been conducted and the parties are on the “courthouse steps” prepared for trial. By then the parties have likely spent a great deal of money, have personally invested much time and energy in the matter and unfortunately, may have hardened their respective positions as a result of the acrimony and animosity that often accompanies lawsuits.
Therefore, the movement recently has been to consider alternative dispute resolution on the front end of a claim after it occurs, before too much time and money has been spent. This approach works extremely well in the employment world, where employees may seek a remedy as a result of a poor evaluation, an altercation with management, a firing or a claim of harassment. If a system is in place for the employee to address their concerns and possibly even resolve them early, all sides are deemed to be better off. From a company bottom line perspective, the ability to resolve an employee claim through in-house dispute resolution significantly reduces the amount of money spent by the company in litigation, reduces overall insurance costs and also reduces the cost of settlement since many times the resolution is not limited to the payment of money but may involve instead letters of recommendation, a withdrawal of an objection to unemployment compensation, the creation of an accommodation for a disabled employee or even a re-hire.
So how would a company go about starting an in-house dispute resolution program? Initially, it all would flow from a “dispute plan” being included as part of the company’s employee handbook. The handbook would provide for different levels of addressing an employee’s complaint, from notification to a supervisor to a referral to upper management to even the option of using an employee peer review method to evaluate the complaint. But ultimately, if those initial internal systems don’t lead to a solution, the matter would then be referred to a mediator who is paid for by the company but independent and unbiased. The employee would be able to choose from a list of qualified mediators who have knowledge and experience in the claims at issue. The mediation would be deemed as “non-binding” meaning that the parties who come together are not required to reach a resolution of their dispute nor will the selected mediator make a decision or render a verdict about the parties’ dispute. If the matter can’t be resolved, then there is no impact to the parties’ respective claims or positions. However, if a settlement is reached and an agreement of terms is prepared, that settlement can then be binding on the parties as a means to create a conclusion to the ongoing dispute.
For this mediation approach to be successful, it would need to be included in the company’s employment handbook as a pre-condition to the filing of any action by the employee against the company. For example, there could be language in the employment handbook (under claims and disputes) which could read as follows:
Any controversy, claim or dispute arising out of the employee’s employment with the company shall first be brought to the supervisor or managers responsible for that employee and if needed, to officers of the company that are responsible for HR matters. If the claim, controversy or dispute cannot be settled internally through this process, then prior to the filing of any legal claim against the Company, the employee agrees to first participate in a mediation led by an independent, third party neutral. A list of approved mediators will be provided to the employee upon request, and any such mediator may be selected by the employee to conduct the mediation.
Conflicts are inevitable. Certainly, even as litigious as our society has become, not every conflict needs to become a lawsuit. With early intervention, especially in the work place, resolution can not only have a beneficial financial impact for the parties, but an atmosphere of dispute resolution can also transform a workplace environment into one where an employee can see that their complaint is being heard, can become a mutual participant in the solution to the problem and can also share in the rebuilding of the impacted employment relationship. All of those features create a positive energy to the resolution process, as compared to the inevitable negative energy that flows from being adversarial litigants in a lawsuit.
For almost thirty years, Scott Zucker has acted as outside legal counsel to a variety of privately held and publicly traded businesses involved in multiple industries. His legal services have ranged from employment, real estate, construction and corporate consulting to representation of companies in the litigation of their financial and business disputes. Scott’s goal is to utilize his legal and business experience to foster the use of Alternative Dispute Resolution to help parties reach resolutions without the time, effort and cost of court litigation. Scott can be reached at Scott@wzlegal.com or 404-364-4626. His ADR service can be found at www.WZdisputes.com.